Tuesday, 22 November 2022

TUESDAY, 22 NOVEMBER 2022

TUESDAY, 22 NOVEMBER 2022

The Speaker took the Chair at 2 p.m.

Karakia/Prayers

Karakia/Prayers

DEPUTY SPEAKER: Almighty God, we give thanks for the blessings which have been bestowed on us. Laying aside all personal interests, we acknowledge the King and pray for guidance in our deliberations, that we may conduct the affairs of this House with wisdom, justice, mercy, and humility for the welfare and peace of New Zealand. Amen.

Petitions, Papers, Select Committee Reports, and Introduction of Bills

Petitions, Papers, Select Committee Reports, and Introduction of Bills

SPEAKER: Petitions have been delivered to the Clerk for presentation.

CLERK:

Petition of Nikki Turner on behalf of United Community Action Network requesting that the House urge the Government to amend the Health Entitlements Cards Regulations 1993 to remove all prescription costs for Community Service Card holders

petition of Sandra Bianciardi requesting that the House urgently stop the National Library from sending overseas published books from its collection to the Philippines, and require it to publicly consult about the best way of preserving, managing, and offering these books to the public.

SPEAKER: Those petitions are referred to the Petitions Committee. Ministers have delivered papers.

CLERK:

Accident Compensation Corporation

annual report 2022

service agreement 2022-23

External Reporting Board

annual report 2021-22

Heritage New Zealand

annual report 2021-22

statement of performance expectations 2022-23

Radio New Zealand

annual report 2021-22

statement of performance expectations 2022-23

Te Hiringa Mahara – Mental Health and Wellbeing Commission

annual report 2021-22.

SPEAKER: Those papers are published under the authority of the House. Select committee reports have been delivered for presentation.

CLERK:

Report of the Governance and Administration Committee on the Sale and Supply of Alcohol (Exemption for Race Meetings) Amendment Bill

reports of the Petitions Committee on the:

petition of Aaron Hendry

petition of Chris Williams

petition of Greg Rzesniowiecki

petition of Sona Kaur

report of the Transport and Infrastructure Committee on the petition of Rosemary Penwarden.

SPEAKER: The bill is set down for second reading. The Clerk has been informed of the introduction of bills.

CLERK:

Grocery Industry Competition Bill, introduction

Social Security (Accommodation Supplement) Amendment Bill, introduction

Health and Safety at Work (Health and Safety Representatives and Committees) Amendment Bill, introduction

Land Transport (Clean Vehicles) Amendment Bill (No 2), introduction

COVID-19 Public Health Response (Extension of Act and Reduction of Powers) Amendment Bill, introduction

Residential Tenancies (Healthy Homes Standards) Amendment Bill, introduction

Hawke’s Bay Agricultural and Pastoral Society Empowering Bill, introduction

New Plymouth District Council (Perpetual Investment Fund) Bill, introduction.

SPEAKER: Those bills are set down for first reading.

Oral Questions

Questions to Ministers

Question No. 1—Finance

1. SHANAN HALBERT (Labour—Northcote) to the Minister of Finance: What recent reports has he seen on the New Zealand economy?

Hon GRANT ROBERTSON (Minister of Finance): In its report on the New Zealand economy this week, Westpac’s economists are forecasting that trading-partner growth will decline from 4.2 percent to 3.5 percent in 2023. The Australian economy is set to slow sharply in 2023, while Chinese economic activity is likely to be constricted by ongoing COVID restrictions. Westpac also notes that the impact of slow trading-partner growth on New Zealand’s prospects will be partly offset by a lower New Zealand dollar, global food supply constraints, and a rebound in tourist numbers. We know that 2023 is going to be a tough year for the global economy, and, inevitably, this affects New Zealand’s prospects. However, New Zealand is in a strong starting point to deal with these challenges, with unemployment near record lows, wages rising faster than inflation, growing exports, and tourists returning in greater numbers.

Shanan Halbert: What other reports has he seen on the economy?

Hon GRANT ROBERTSON: Activity in the manufacturing sector declined in October. The seasonally adjusted BNZ-Business New Zealand Performance of Manufacturing Index was down 2.4 percent to 49.3. This is the lowest level of activity since August 2021.

Shanan Halbert: How does manufacturing activity in New Zealand compare internationally?

Hon GRANT ROBERTSON: Business New Zealand said, in that same report, that New Zealand manufacturing activity mirrored what was seen overseas, with decreasing production and a drop in demand for new orders. New Zealand joined China, the UK, Europe, and Australia in decline, while activity in the US and Japan was just above the break even mark of 50.

Shanan Halbert: What reports has he seen on the demand for workers and its impact on the economy?

Hon GRANT ROBERTSON: The SEEK NZ Employment Report declined a seasonally adjusted 1.1 percent in October. On an annual basis, ads rose at 16.3 percent on the same month a year ago. BNZ’s economists said job ads remain at high levels, compared to where they have been in the past, but the series indicated that a peak might have been reached in recent months. New Zealand finds itself well placed in a volatile and uncertain global environment. The Government will continue to take a balanced and sustainable approach, supporting New Zealanders while investing in health, education, and housing, and addressing climate change while also keeping debt under control. This will mean tough choices are required, but New Zealand is well placed to make them.

Question No. 2—Prime Minister

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

Rt Hon JACINDA ARDERN (Prime Minister): Yes, particularly the introduction today of the Grocery Industry Competition Bill. The bill establishes a Grocery Commissioner at the Commerce Commission, who will have access to a range of enforcement and monitoring tools. It also enables collective bargaining and implements a grocery supply code to protect suppliers from unfair contract terms. The Commerce Commission found New Zealand’s supermarkets earn $1 million a day in excess profits because of a lack of competition. As the global cost of living crisis continues to put pressure on families, this bill is one way the Government can tackle the root causes and enable New Zealanders to get a fairer deal at the checkout.

Christopher Luxon: How many more retailers have to have their windows smashed and their staff and customers terrorised before her Government will actually take action to stop the youth crime wave?

Rt Hon JACINDA ARDERN: I totally reject the premise that we are not acting on what we are already seeing. If I were to give you just a snapshot, for instance, in Counties Manukau, since the beginning of 2022, we’ve had 85 ram raids, 63 prosecutions, and 30 youth referrals just for that district alone. You are seeing action being taken by the police, supported by the fact that we have a record number of police on the beat as a result of the increase in support from this Government, and we continue to make the interventions required to deal with what has been a spike in ram raid activity.

Christopher Luxon: Does she accept we need tougher consequences for young serious offenders who drive cars into shop windows or rob jewellery stores in broad daylight?

Rt Hon JACINDA ARDERN: Obviously, as a burglary, it already attracts a maximum level of 10 years for a successful conviction. I would also point to the fact that, yes, whilst we have seen a spike, we are also starting to see a decline. In August, we had 75; for the current month, we are currently standing at 13. Again, I point to the fact that you have seen the police rigorously pursuing those who have undertaken this activity, and, as I say, a high proportion of prosecutions across each of those districts.

Christopher Luxon: Has she actually visited and met with any victims of a ram raid in the last six months?

Rt Hon JACINDA ARDERN: I have spoken to a ram raid victim, and I’ve spoken about that in this House before. The most important thing for us to do, though, is, of course, ensure that those who are undertaking this activity are brought to justice and that the interventions are in place to stop the repeat offences. Despite the statements being made by the member, I have just shared the evidence of what is occurring, and it is about making sure that we address what is happening on the ground. At the same time, we also have to try and prevent this kind of activity in the first place. Labour has always been a Government, and party, that does both; National rehash failed policies for political gain.

Christopher Luxon: Why, then, haven’t her policies worked?

Rt Hon JACINDA ARDERN: As I just pointed out, we are seeing a decline. On the other hand, that member is choosing not to accept the fact that his boot camp policy was brought in by John Key in 2008, again by Bill English in 2017, and again, now, by the new member who purported to bring fresh ideas for the National Party.

Christopher Luxon: Why does she not think that the New Zealand Defence Force has some of New Zealand’s best leaders and mentors and might have something to teach serious young offenders?

Rt Hon JACINDA ARDERN: Because the evidence tells us that when you use those policies, recidivism continues to be high; 85 percent reoffending rate. This is not about whether you respect our defence force; it’s whether you look at the facts.

Hon Grant Robertson: Further to that supplementary, does the Prime Minister believe that the New Zealand Defence Force might have some other things that they need to do?

Rt Hon JACINDA ARDERN: Yes. In fact, we have a large cohort currently in the United Kingdom training Ukrainians in order to support the war effort in Russia’s illegal war.

Christopher Luxon: Why wouldn’t she be interested in a 50 to 65 percent reduction in theft, burglary, and violent crime, given her policies are leading to a ram raid every 15 hours?

Rt Hon JACINDA ARDERN: Because the policy that the member has rehashed from the National Party for the third time has a reoffending rate of 85 percent. We are interested in policies and interventions that work. Our goal in this House should be to reduce victimisation and reduce reoffending. That is what we are focused on, rather than rehashing old failed policy.

Christopher Luxon: Why is the Prime Minister more focused on telling New Zealanders that the voting age should be 16, when she and her Government should be addressing the serious issues of youth crime and the 100,000 students who are chronically absent from school?

Rt Hon JACINDA ARDERN: Despite the member’s claim, I do not personify the Supreme Court. It was them that made the decision.

David Seymour: Does she stand by the Government’s 2019 decision to repeal the offence of blasphemous libel because it was “Inconsistent with the freedom of expression as protected by the New Zealand Bill of Rights Act”?

Rt Hon JACINDA ARDERN: We stand by the changes we made, but, of course, what we did not repeal was the Human Rights Act and the sections that currently protect, for instance, different ethnicities from those same provisions.

David Seymour: If the Government indeed thought it appropriate to remove the offence of blasphemous libel from the law books, by what logic is it now proposing to introduce a law that would criminalise insulting language directed at religious groups?

Rt Hon JACINDA ARDERN: The member is misleading the public, and this is one of the issues about debating this, because what the member is not acknowledging is that we already have these sections in the Human Rights Act—it’s sections 61 and 131. What we are proposing is to add the word “religion”.

David Seymour: So can the Prime Minister please lead the people of New Zealand properly if I am misleading them: can she explain how it is logical to repeal a law against blasphemous libel and then introduce a law which makes it an offence to insult a religion?

Rt Hon JACINDA ARDERN: What I am correcting the member on is the fact that the provision already exists—it already exists. We are simply adding to what is already incitement provisions on ethnic grounds, adding the word “religion”.

Hon Kiritapu Allan: Can the Prime Minister confirm that what the Government’s decision is, with respect to the Human Rights Act amendments made this week, is about incitement and inciting others, not mere insulting or otherwise comments that the other member has said?

Rt Hon JACINDA ARDERN: Yes, I can. And I can also confirm there are existing provisions under the Human Rights Act that apply to colour, race, or ethnicity. What we are proposing is to add the word “religion”. If the member believes that these provisions are wrong, then he should oppose the existing law, not simply the proposal. And I’m glad we have clarified that.

David Seymour: Does the Prime Minister know how many parents have been fined for their children’s non-attendance of school, under section 244 of the Education and Training Act, and, if she’s not prepared, can she just tell us: is it closer to 10, 1,000, or 10,000 in the last year?

Rt Hon JACINDA ARDERN: I’m not sure that it’s fair for the member to claim that it’s a question of preparation. I’m always happy to provide the member with the latest numbers if he puts them on notice. What I can tell the member is that we’ve considerably increased, in the Budget, funding on attendance services because we have set an aspiration of lifting those numbers despite the decline since 2015.

David Seymour: So is the number of parents fined for students’ non-attendance at school closest to 10, 1,000, or 10,000 in the last year?

Rt Hon JACINDA ARDERN: I already answered the member in my first question, but what I would also caution the member, in looking at the context of the numbers when I am able to provide them to him directly, is that, of course, you would be looking across a year where we’ve had the greatest number of influenza—and a pandemic, which will measurably impact the attendance numbers and the consequences for parents.

Hon Chris Hipkins: Has the Prime Minister been advised that harsher penalties for parents who don’t send their children to school, which were implemented or were legislated for by the previous Government, have seldom been invoked, because they have been found to be ineffective?

Rt Hon JACINDA ARDERN: Yes. At the same time, the same National Opposition that criticises attendance also did not invest in attendance services. Not only did they change the system markedly, which reduced the effectiveness of attendance services, they increased their budget by about 2 percent. When you compare that to the last two Budgets, where we’ve put in a 26 percent increase in those services.

Question No. 3—Housing

3. ANGIE WARREN-CLARK (Labour) to the Minister of Housing: What actions has the Government taken recently to address the housing infrastructure shortage?

Hon Dr MEGAN WOODS (Minister of Housing): Last week, I announced the Government is investing a further $540 million in critical housing infrastructure though our $1 billion contestable Infrastructure Acceleration Fund. This latest round of funding will pay for critical infrastructure like pipes and roads in 13 projects across Hamilton, Auckland, Tauranga, Christchurch, Kawakawa, Kaikohe, Westport, Upper Hutt, Waipukurau, Hokitika, and Pahiatua to enable around 16,600 new homes to be built over the next 10 to 15 years. The housing crisis requires sustained investment in infrastructure to address the massive deficit we’d inherited, and we’re getting on with the job.

Angie Warren-Clark: Why is the Government making record investments in housing infrastructure?

Hon Dr MEGAN WOODS: When we looked into the reasons why New Zealand has simply not built enough houses, we heard that a key reason is severe, long-term under-investment in the literal groundwork to connect new homes and to connect critical services. The Infrastructure Acceleration Fund lays this groundwork with new roading, three waters infrastructure for drinking water, waste water, and stormwater, meaning new housing projects can get under way faster.

Angie Warren-Clark: How is the Government supporting the delivery of more homes in Hamilton?

Hon Dr MEGAN WOODS: The Government is investing more than $150 million to enable around 4,000 new homes in Hamilton City. The funding will be used for further development in the area, including a new water reservoir and pump station, local waters upgrades and improvements, and a multimodal walking and cycling bridge across the Waikato River to connect the eastern suburbs to the city centre. In addition to our infrastructure acceleration funding, we’re building public houses at pace in Hamilton and delivering, on average, around 130 new homes each year, compared to around 16 homes per year between 2008 and 2017.

Angie Warren-Clark: Has the Minister seen any response to the Government’s $150 million investment into homes in Hamilton?

Hon Dr MEGAN WOODS: It was great to make the announcement last week in Hamilton with Mayor Paula Southgate. Mayor Southgate has said of the fund, “The fact the Government has listened to our pleas and agreed to help pay for this fit-for-purpose infrastructure is fantastic news for Hamilton. … This grant is truly game-changing and supports council’s vision to transform the central city into a vibrant place where people want to live, work and visit.”

Question No. 4—Finance

4. NICOLA WILLIS (Deputy Leader—National) to the Minister of Finance: Does he agree with Westpac that “a much higher level of interest rates will be needed to bring inflation under control”, and what impact, if any, have Government spending decisions had on domestic inflation?

Hon GRANT ROBERTSON (Minister of Finance): As the member will appreciate, as has been the case for finance Ministers since 1989, it is not appropriate for me to provide opinions on what the correct level of interest rates might be for the Reserve Bank to meet its price stability objective. I would note that, in the latest Monetary Policy Statement, the Reserve Bank indicated a forward track that did see increasing interest rates as they seek to return to the 1 to 3 percent inflation band. To answer the second part of the member’s question, the Government has taken a number of actions to take pressure off Consumers Price Index (CPI) inflation. For example, when we announced spending to reduce fuel excise duty and road-user charge, economists estimated that this would take 0.5 percentage points off the domestic headline CPI. I further note the Treasury’s commentary in the Budget Economic and Fiscal Update: “the fiscal impulse is forecast to turn negative … in 2022/23 and remain so throughout the remainder of the forecast period. This indicates that, as temporary COVID-19-related fiscal support is withdrawn year-on-year and the fiscal balance heads into surplus, the Government is forecast to contribute less to aggregate demand each year than in the preceding year.”

Nicola Willis: Is it the case that a borrower who fixed their mortgage at 2.7 percent in 2020 will now face re-fixing their rate at over 6 percent, meaning that someone with a $500,000 mortgage will need to find a whopping $310 more per week to service their mortgage under Labour?

Hon GRANT ROBERTSON: As we’ve discussed before when the member has raised these kinds of examples, it would very much depend upon the specific circumstances of that household. What we do know is that many New Zealanders will be facing increased mortgage payments over the coming year. That’s why it is a good thing that average hourly earnings are tracking just above inflation at the moment. That’s why it’s a good thing that we’ve increased the minimum wage. That’s why it’s a good thing that we’ve provided additional support for low and middle income households—things that the National Party has opposed.

Nicola Willis: Does he recall receiving advice from Treasury that extra fiscal stimulus would cause the official cash rate to rise by an additional 30 basis points for every percentage of GDP, and, if so, what responsibility does he take for the contributions that stimulatory fiscal policy—big spending—has made to New Zealanders’ interest rates?

Hon GRANT ROBERTSON: The responsibility I take is having been the Minister of Finance while we have helped New Zealanders get through COVID. That indeed did require a significant fiscal response—a fiscal response that, at various times, the National Party either supported or didn’t support. But I would note that, even as late as 2021, when there were examples of concern being raised about where interest rates might go, the National Party was continuing to propose more spending in certain areas. So the member can’t have it both ways.

Nicola Willis: Does he recall his officials specifically advising that the cost of living payment would add to inflationary pressures, and, if so, what advice has he had about how much higher inflation, and therefore interest rates, is as a result of his sending money to backpackers in Europe?

Hon GRANT ROBERTSON: What I do recall is the Treasury saying that if a payment was made that was temporary and targeted, that would have less of an impact on inflation than, for example, across-the-board tax cuts that go disproportionately to the wealthiest New Zealanders. We have stepped up continually through the period of COVID to support New Zealand households. The member might want to rewrite history now and claim that we didn’t need to do that, the wage subsidy wasn’t needed, we didn’t need to step in to support people on $70,000 a year—she used to say those things in the House. The Government has stepped up to support New Zealanders, and I am proud of our record in doing so.

Nicola Willis: Has he failed to deliver on his promise to tilt the balance towards first-home buyers, when analysis by interest.co.nz published today shows that housing affordability for first-home buyers is the worst it has been since reports began in 2004?

Hon GRANT ROBERTSON: What I do know we have done is tilt the balance so that there is now a higher percentage of first-home buyers in the market than we have seen from when that statement was made.

Nicola Willis: What does he say to Maddie, a young first-home buyer in Wellington, who is bracing for an interest rate increase of over $25,000 a year when she re-fixes next year, and does he take responsibility for his actions which have further pushed up interest rates?

Hon GRANT ROBERTSON: As we have said many times in this House, there are a number of households in New Zealand who are going to find 2023 tough. That’s the reason why, as a Government, we have stepped up to support low and middle income households to get through this period of time. The member continues to misrepresent the position of what it is that causes inflation. If the member is really, really serious about wanting to debate these issues, it shouldn’t be on the basis of taking out small amounts of spending that she may or may not agree with and claiming that, somehow or other, they are exacerbating inflation. If Government spending was to truly exacerbate inflation, it would need to be something like across-the-board tax cuts that were going to the wealthiest New Zealanders, or the member might like us to stop our State house building programme and explain to Mr Bishop how that works, or stop our spending in the health sector and explain to Dr Reti how that works. It’s not quite as simple as the member thinks it is.

Question No. 5—Foreign Affairs

5. IBRAHIM OMER (Labour) to the Minister of Foreign Affairs: What recent announcements has the Government made about support for Ukraine in response to Russia’s illegal invasion?

Hon NANAIA MAHUTA (Minister of Foreign Affairs): The Government recently announced the extension of the New Zealand Defence Force (NZDF) support for Ukraine, including intelligence and logistic support and training for Ukrainian military personnel in the United Kingdom. This extension will see a team of 66 NZDF personnel deployed to the UK through to July next year to provide infantry training to Ukrainian forces. It will also build on the great work accomplished by the UK-led programme, which has seen nearly 10,000 Ukrainian personnel benefit from training to date. In his recent visit to the UK and Kyiv, the Minister of Defence heard firsthand, from Ukrainian troops and Government, the difference this training has made to the preparation of Ukraine’s armed forces in addition to the package of military, diplomatic, legal, and humanitarian assistance provided by Aotearoa New Zealand.

Ibrahim Omer: What is New Zealand doing to support Ukraine through the upcoming northern winter?

Hon NANAIA MAHUTA: New Zealand has pledged a further $1.85 million to the NATO Trust Fund for Ukraine. This will provide non-lethal military support like winter clothing, food rations, mobile generators, first-aid kits, and other vital supplies over the coming northern winter. This adds to the $8.7 million New Zealand has provided to date to purchase basic equipment, medical supplies, fuel, and food rations for Ukraine through the NATO Trust Fund. In response to appeals, we’ve also provided $7.9 million in humanitarian aid to support Ukrainian civilians this year. We will continue to monitor the humanitarian needs over winter and any appeals for aid to support Ukraine.

Ibrahim Omer: What is New Zealand doing to put further pressure on Russia to end its illegal war?

Hon NANAIA MAHUTA: Yesterday, I announced further sanctions on members of the inner circles of Governments in Russia and Belarus, as part of the ongoing international response to the war in Ukraine. These recent sanctions targeted 22 members of the elite who lend support to the illegal invasion of Ukraine; Russia relies on the ongoing support of those in positions of power and influence as it continues its illegal and unjustified invasion of Ukraine. Also sanctioned yesterday were four entities of economic or strategic relevance to Russia in the oil and gas, steel, and transport sectors, as well as radar and electronic equipment systems.

Ibrahim Omer: What impacts are sanctions having on Russia?

Hon NANAIA MAHUTA: This is the 16th tranche of sanctions against Russia, adding to existing sanctions on 1,200 individuals and entities covering political leaders, oligarchs, banks, gold importers, defence industry, cyber-hackers, and Belarus. These sanctions are having an impact since the introduction of our trade measures in April—for example, imports from Russia have dropped by 75 percent. New Zealand is playing its role in the global effort to debilitate Russia’s ability to wage its unjust war against Ukraine. Russia’s economy is expected to contract by at least 3 percent this year, and export controls have severed Russia’s access to key technologies like semiconductors that will erode its military capability.

Question No. 6—Housing

6. CHLÖE SWARBRICK (Green—Auckland Central) to the Minister of Housing: Is she confident that the homes of the 1.4 million New Zealanders who rent are healthy and well managed?

Hon Dr MEGAN WOODS (Minister of Housing): Over our five years in Government, we have made good progress in improving standards for renters, but we know there is still work to do. We introduced the healthy homes standard in 2017. As of October 2021, surveys indicate that around 85 percent of private landlords report that they have met the standard or have begun the work required to meet the healthy homes standard. Likewise, 84 percent of Kāinga Ora tenancies either meet the standards or have work in progress to meet them, and Kāinga Ora are now upgrading 600 homes a week.

Chlöe Swarbrick: Why, then, does the Government not have a verifiable central repository of data on compliance on private rentals with the healthy homes standards?

Hon Dr MEGAN WOODS: There is a number of streams of work under way around compliance with the healthy homes standards. There is at the moment, due to finish in November of this year, another survey that is in the field that will be reported to Government around both tenant and landlord uptake. We also, in Budget 2021, allocated nearly $16 million over four years for implementation that included compliance and monitoring. There was an increase of investigations and assessments from 2,000 to 3,000 per annum, a greater level of compliance with the standards through employing an additional 14 compliance and investigation personnel, increasing the capacity for proactive monitoring and enforcement activity. There was data analysis and intelligence work to ensure that interventions are targeted at the highest risk areas so we can look at minimising harm in those areas. We’re also supporting the most vulnerable tenants to take action against non-compliance and providing information and education to the residential tenancy sector to raise awareness of compliance.

Chlöe Swarbrick: Has she seen reports from inspection companies that professionally managed rental properties had higher levels of compliance with healthy homes standards while independent landlords had lower levels of compliance, and, if so, doesn’t that suggest that private landlords should also be registered and regulated, like she announced for property managers today?

Hon Dr MEGAN WOODS: The changes that we made around the moves that our Government is making to finally regulate property managers, in the legislation that will be debated in this House, do not apply to individual landlords, for the very simple reason that the advice that I have is that individual landlords are regulated through the Residential Tenancies Act (RTA). But what I have made very clear to the sector is that this is a particular area of interest that I would like the select committee to look at very closely to see if there is a case for broadening it. But the advice I have at the moment is that it is not required because the RTA does that.

Chlöe Swarbrick: Did the Government, then, consider including private landlords who manage 60 percent of private rental properties in this country in its proposed property manager register, which closed to public consultation nine months ago, and, if so, why did it decide against it?

Hon Dr MEGAN WOODS: I think I covered off the answer to that question in the previous answer that I gave, that this is something that was canvassed—of course it was—that we are a Government that has a programme of work for the first time to improve the lot of renters in this country, that the advice that we had is that this was not required because individual landlords are regulated under the Residential Tenancies Act. And, as I also said in the answer to the last question, this is a question that I would like the select committee to spend some time considering.

Ricardo Menéndez March: How many Kāinga Ora tenants is the Government comfortable with getting sick due to living in cold, damp, unhealthy homes as a result of the extension of the healthy homes standards compliance?

Hon Dr MEGAN WOODS: We are a Government that is only tolerant of zero percent of Kāinga Ora tenants living in cold, damp homes. That is why we are a Government that not only has the largest State house build in a generation but we are a Government that has committed to not only meeting the healthy homes standards but have invested a significant amount of money in the refurbishment of our current stock. Unlike the previous Government, I’d like to add, who, instead of doing that, took out half a billion dollars in dividends from the then Housing New Zealand.

Chlöe Swarbrick: Will the Government reverse the burden of proof of compliance and implement a warrant of fitness which would cover all rental properties, and resolve issues with healthy homes standards data, compliance, and enforcement; if not, why not?

Hon Dr MEGAN WOODS: Through the course of developing this legislation a warrant of fitness was considered. The cost-benefit analysis showed that minimum standards were the more effective tool. So the reason we won’t be is because the advice we have is that they are the more effective tool. I would like to point out to that member that the tenancy compliance and investigation team (TCIT) at the Ministry of Business, Innovation and Employment undertakes both proactive assessments and reactive investigations in regard to compliance. Since 1 July 2021, the TCIT have investigated 416 cases where breaches of the healthy homes standard were alleged; 88 percent of those investigations were proactive assessments while 12 percent were in response to a tenant complaint and breaches of the standard were confirmed in 34 percent of those cases. We are proactively making sure that landlords comply with the standard.

Question No. 7—Health

7. Dr SHANE RETI (National) to the Minister of Health: What is the latest reported average wait-time in emergency departments across New Zealand, and what was the longest wait-time at Christchurch Hospital ED this weekend?

Hon ANDREW LITTLE (Minister of Health): The average wait time is just over five hours. Data for September 2022 shows that the national average shortest day in emergency departments (EDs) had 71.2 percent of patients treated, transferred, or discharged within six hours. In terms of Christchurch Hospital’s ED performance over the past weekend, I’m advised that hospital staff saw a little over 1,000 patients across the 72-hour period from Friday night through to Sunday. The average time from presentation to discharge was just over 4½ hours. The longest time from presentation to discharge was just over 17½ hours.

Dr Shane Reti: Isn’t it true that now one month after the ED tragedy at Christchurch, when there were 11 nursing roster gaps, he has done absolutely nothing to relieve the crisis except hold a hui in Parliament?

Hon ANDREW LITTLE: No.

Dr Shane Reti: If the sector is coping, as he wrote in written questions recently, why are Wellington ED nurses handing out the Minister’s contact details to patients to complain, as reported today?

Hon ANDREW LITTLE: I’m not responsible for the discharge of duties by clinical staff in our hospitals.

Dr Shane Reti: Is his appalling management of the record surgical wait-list at Christchurch Hospital placing even further pressure on ED, given he replied to me that nearly a third of patients on current wait-lists have also been to ED?

Hon ANDREW LITTLE: No.

Question No. 8—Education (School Operations)

8. CAMILLA BELICH (Labour) to the Associate Minister of Education (School Operations): What feedback has she seen from principals and schools on the Government Attendance and Engagement Strategy?

Hon JAN TINETTI (Associate Minister of Education (School Operations)): The Government has been working with schools and communities to turn around the decade-long decline in regular attendance. The collaborative approach to getting kids engaged and regularly attending at school has been well received by the sector. For example, Kate Gainsford, the chair of the Secondary Principals’ Council highlighted this when she said, “The collective effort required to support parents, caregivers, and whānau in communities is acknowledged in the strategy. … strengthening local support for whānau is absolutely crucial to ensuring tamariki and rangatahi go to school.”

Camilla Belich: Why is listening to schools and principals important?

Hon JAN TINETTI: In order to make meaningful change, we need to draw on evidence about what works. The people best placed to provide that advice are the professionals and the experts in the sector. When we launched our comprehensive Attendance and Engagement Strategy, we worked with the sector to set ambitious targets. Together, we developed actions to respond to the impacts of COVID-19 and re-engage kids in education. We backed that with an $88 million attendance package to empower local solutions to meet our attendance target.

Camilla Belich: What examples has she seen of the Regional Response Fund making a difference for schools?

Hon JAN TINETTI: I’ve seen many examples on how the Regional Response Fund is enabling innovative ways to remove barriers to regular attendance. For example, Tawhero School has reported utilising the Regional Response Fund to work with tamariki with severe anxiety and who are disrupted from learning stemming from COVID-19—a combination of physical activities alongside learning new strategies to work through mental health challenges that are getting in the way of their learning. This builds on evidence from the Urgent Response Fund after the first lockdown, where addressing the wellbeing and mental health needs was critical to getting our kids back to the classroom.

Camilla Belich: Can the Minister provide other examples of how principals are using the Regional Response Fund to improve attendance at their school?

Hon JAN TINETTI: There are many, and, yes, I can, but there is one in particular that stands out for me. In the Nelson, Marlborough, and West Coast area, Kāhui Ako have worked together to implement a bespoke plan to improve attendance outcomes for vulnerable learners, including analysing school data, engaging with social support workers and whānau connectors, and breaking down barriers to attendance in enacting a back to school local campaign. I have full confidence in our principals and teachers to understand the needs of our young people and get them back and engaged in the classroom.

Erica Stanford: Can she explain why, despite the Urgent Response Fund at $50 million and the Regional Response Fund at another $40 million, the numbers of students who are currently officially classified as chronically absent is still over 100,000 children, a number that has nearly tripled in the last five years?

Hon JAN TINETTI: Yes, I can. The data that shows that is the most official data and comes from term 2. In term 2, we know that that was attributable to the fact that New Zealand was at the peak of the COVID-19 pandemic. It does not take much to put young people into that chronically absent area. It is something that we have explained in the House before; it would be good if people could actually understand the data.

Question No. 9—Housing

9. BROOKE VAN VELDEN (Deputy Leader—ACT) to the Minister of Housing: Did she take a paper to the Cabinet Social Wellbeing Committee last week; if so, did that paper contain a recommendation to extend time frames for private landlords to reach the heathy homes standards?

Hon Dr MEGAN WOODS (Minister of Housing): Yes, along with recommendations to extend the compliance time frames for Kāinga Ora and community housing providers. This Cabinet paper was based on policy decisions that I made in August of this year.

Brooke van Velden: Why did it include private landlords?

Hon Dr MEGAN WOODS: Because we’d heard from private landlords that they needed additional time in order to reach the standards.

Brooke van Velden: Is it a contradiction from this Government to extend the healthy homes standard deadlines for private landlords when, in this House, on 18 November 2021, in answer to my question about an extension to the healthy homes standards, the now former Associate Minister of Housing said, “It’s my understanding that the vast majority of landlords have already complied,”; and about advice received, “The advice was that it would not be possible to extend compliance deadlines in a way that assists the vast majority of landlords, and including those whose compliance deadlines have already passed.”?

Hon Dr MEGAN WOODS: Of course it’s not a contradiction—we are a pragmatic Government that listens to sector feedback. What we do know is that the most up-to-date data that we have from survey work is around 85 percent of private landlords have complied or have work under way to comply with the standard. This is roughly around the same as Kāinga Ora, of what they have completed or have under way. This suggests to me that this is around the market capacity at the moment, given the constraints that we’ve seen in completing this work. It would be absurd for our Government not to listen to that.

Brooke van Velden: When did this advice change?

Hon Dr MEGAN WOODS: If the member cared to listen to the previous answer that I gave to the primary question, the decision was made based on policy decisions that I made in August. I received a briefing on 9 August, of which I agreed to the recommendations to include Kāinga Ora, community housing providers, and private landlords, as well as extending out the time to comply between tenancies from 90 to 120 days. I know that the Opposition spokesperson on housing has put out a press release today saying that this was in response to ACT’s pressure, but she is simply wrong and the documentation shows she is wrong.

SPEAKER: Did you refer to the National Party?

Hon Dr MEGAN WOODS: No, I was referring to the Opposition spokesperson.

SPEAKER: The ACT spokesperson?

Hon Dr MEGAN WOODS: Oh, sorry. The ACT spokesperson.

SPEAKER: OK, very good. But the start of the answer was unnecessary. I’ll give the member an extra question.

Brooke van Velden: Will she release all advice on the healthy homes extensions that she has received, including relevant Cabinet papers and advice that she’s received from officials?

Hon Dr MEGAN WOODS: The relevant Cabinet paper was put up earlier today on the Ministry of Housing and Urban Development website, so it has already been received. And point of order, Mr Speaker. I seek leave to table a piece of advice from the Ministry of Housing and Urban Development, dated 8 August 2022 and entitled Residential Tenancies (Healthy Homes Standards) Regulations 2019—

SPEAKER: Is it publicly available?

Hon Dr MEGAN WOODS: No, it’s not. Review of—

SPEAKER: Leave is sought for that. Is there any objection? There appears to be none; it may be tabled.

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

SPEAKER: Sorry, I just want to check. Did you use the extra question I gave you or are you—

Brooke van Velden: I did use an extra question.

Question No. 10—Justice

10. Hon PAUL GOLDSMITH (National) to the Minister of Justice: Are the Government’s justice priorities to deal effectively with the increase in violent crimes and delays to justice?

Hon KIRITAPU ALLAN (Minister of Justice): I can confirm that those are two of our priorities, alongside a range of others.

Hon Paul Goldsmith: Why has the Government chosen to prioritise hate speech legislation, when it still hasn’t fixed the 527 percent increase in the number of victims of serious crimes waiting longer than two years for justice, and shouldn’t it be focused on that?

Hon KIRITAPU ALLAN: I can confirm that what we have undertaken to do as a Government is respond to and implement the recommendations of the Royal Commission of Inquiry into the terrorist attack on Christchurch, of which amending and extending the incitement provisions in the Human Rights Act to religious groups was a direct recommendation.

Hon Paul Goldsmith: Why is the Government prioritising legislation to lower the voting age, when, for example, it’s still far from successfully addressing the 500 percent increase in ram raids, and shouldn’t that be her focus in justice?

Hon KIRITAPU ALLAN: I’ll answer that question in two parts. To the latter part of the question: the member will be minded that since we announced the better wraparound support in September to young offenders, around half of the most serious and repeat offenders that were identified are now back in education or training, and almost a third have not reoffended. Since May, in Auckland, 1,036 charges have been laid against 142 young people; in Waikato, 1,229 charges have been filed against 205 young people. On this side of the House, we have decided to take an evidence-based approach to focusing on youth crime. On the other side of the House, they have consistently decided to take a non-evidential basis, announcing policies that show 85 percent failure, where their own Ministers and former Ministers have resoundingly reprimanded the Opposition for announcing rehashed, re-failed policies.

Hon Paul Goldsmith: Does she agree with the Prime Minister only a few weeks ago, who said we need extra tools to help deal with the youth crime wave that we’re confronting, and why is she not open to considering those extra tools as suggested by the National Party?

Hon KIRITAPU ALLAN: As just previously stated, our side of the House has been focused on increasing more police on the streets. Their side of the House, when they were in power, they reduced the number of police on the streets, they reduced the number of tools that were available to them, and they closed police stations. On our side of the House, we have decided to act on evidence. On their side of the House, they rehash failed policies, and they’re expensive policies at that.

Question No. 11—Commerce and Consumer Affairs

11. GLEN BENNETT (Labour—New Plymouth) to the Minister of Commerce and Consumer Affairs: What announcements has he made about improving supermarket competition?

Hon Dr DAVID CLARK (Minister of Commerce and Consumer Affairs): Yesterday, I announced the bill to trigger an unprecedented shake-up of the grocery sector and help New Zealanders get a fairer deal at the supermarket. That bill has been introduced to Parliament ahead of its first reading. The duopoly has now been given plenty of warning; if they fail to adequately open up their wholesale arms voluntarily, Government will make it happen for them. As the global cost of living crisis continues to put pressure of families, this bill is one way Government can tackle the root causes.

Glen Bennett: How will this bill improve competition in the grocery sector?

Hon Dr DAVID CLARK: Alongside their retail stores, supermarkets have behind-the-scenes wholesale operations. Earlier this year, I called on the duopoly to lock in good-faith wholesale arrangements on their own terms, or risk facing regulatory intervention. The bill establishes a Grocery Commissioner who will act as a referee for the sector. If the duopoly fails to reach commercial wholesale deals, or those deals aren’t competitive enough, the commissioner will have the ability to intervene and require a certain price and range. You cannot run a supermarket on empty shelves. That is why it is vital that the duopoly’s competitors have access to fair wholesale terms.

Glen Bennett: What else will this bill achieve?

Hon Dr DAVID CLARK: The bill will also enable collective bargaining and it will implement a grocery supply code to protect suppliers from unfair contract terms. This is especially important for smaller local businesses vying for shelf space in our major supermarkets. Also included is a dispute resolution scheme for suppliers and wholesale customers. This bill will not only ensure there is increased competition in the sector but it will fundamentally change the power dynamic between the duopoly and other players in the market.

Glen Bennett: Has he seen any industry response to the announcement?

Hon Dr DAVID CLARK: Yes, I have. The Food and Grocery Council said the bill “will address a wide range of desperately needed changes in the grocery sector”. Chief executive Raewyn Bleakley called the work to address wholesale offerings “very significant” and also congratulated Government for moving so fast to get this bill introduced. As the global cost of living crisis continues to put pressure on Kiwi families, our duopoly is making excess profits of $1 million a day. This Government is committed to getting consumers better bang for their buck at the checkout.

Question No. 12—Education

12. PENNY SIMMONDS (National—Invercargill) to the Minister of Education: Does he stand by his Associate Minister’s statement on his behalf regarding Te Pūkenga that “no discussions have been had around co-leadership”?

Hon CHRIS HIPKINS (Minister of Education): Yes, in the context it was made, particularly as it followed questions about whether Te Pūkenga should have a Māori at chief executive level. I am aware that Te Pūkenga’s current recruitment includes eight regional co-leadership positions. Each of the four regions will have one co-leader with primary responsibility for maintaining and operating effective partnerships with hapū and iwi in that region.

Penny Simmonds: Is the cost of co-leadership roles included in the programme business case the Minister received from Te Pūkenga in October, and how much additional funding in total was sought in the business case above what had been budgeted for?

Hon CHRIS HIPKINS: The answer to the first part of the question is yes. In answer to the second part of the question, we have not yet released that information.

Penny Simmonds: What impact does the Minister consider the eight co-leadership roles, costing between $200,000 and $350,000 each, might have on the morale of staff waiting to hear if they are going to be made redundant?

Hon CHRIS HIPKINS: Consolidating 16 individual entities into one national entity with a regional leadership structure is likely, ultimately, to result in cost savings at the leadership level.

Penny Simmonds: Does the Minister consider it good practice to advertise co-leadership positions for four regions that haven’t yet been agreed on, and will the regions mirror the four regions of three waters and/or iwi boundaries?

Hon CHRIS HIPKINS: In answer to the last part of the question, those will be decisions for Te Pūkenga. In answer to the first part of the question, I do think that the co-leadership model, in this particular instance, has a lot to offer. There is no question that our vocational education system needs to do a better job of serving Māori learners. The member will be well aware of that given her former institution, the Southern Institute of Technology, has the worst first-year retention rate for Māori students in the country.

Appointments

Assistant Speaker

Hon CHRIS HIPKINS (Leader of the House): Point of order, Mr Speaker. I seek leave of the House to move a motion without notice to appoint a temporary Assistant Speaker.

SPEAKER: Leave is sought for that purpose. Is there any objection? There appears to be none.

Hon CHRIS HIPKINS: I move, That this House appoint Barbara Kuriger as an Assistant Speaker until midnight on Saturday, 26 November 2022.

One of our Assistant Speakers, the Hon Jenny Salesa, is away unwell this week. The Parliament is about to, later on this evening, go into urgency for a prolonged sitting. Much of that will be in committee, and, therefore, there is a need for an additional Assistant Speaker to preside over some of the House’s deliberations during that time.

I’m sure Barbara Kuriger will have the confidence of the House in performing that role. She is well known to members across the House, having been a member for some time, and also having served—I think very well—as an impartial, fair, and balanced select committee chair. So I commend her nomination to the House.

Motion agreed to.

Bills

Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua Claims Settlement Bill

Second Reading

Hon ANDREW LITTLE (Minister for Treaty of Waitangi Negotiations): I present a legislative statement on the Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua Claims Settlement Bill.

SPEAKER: That legislative statement is published under the authority of the House and can be found on the Parliament website.

Hon ANDREW LITTLE: I move, That the Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua Claims Settlement Bill be now read a second time.

Tākiri mai ana te ata, ki runga o ngākau mārohirohi. Korihi ana te manu kaupapa, ka ao, ka ao, ka awatea. Tihei mauri ora. E mihi ana ki a koutou kua tae mai nei i runga i te karanga o te kaupapa o te rā, tēnā koutou, tēnā koutou, tēnā koutou katoa. E mihi ana ki te hunga mate, haere, haere, haere atu rā. Ki a tātou te hunga ora, tēnā tātou. Kia whakamānawatia ngā mana o ēnei whenua e tū āhuru nei, tēnei au, otirā mātou te Kāwanatanga e mihi nei ki te kaupapa o te wā, tēnā koutou, tēnā koutou, tēnā tātou katoa.

[Dawn breaks, a new morning and a dauntless heart. The voice of this issue now sings, a new dawn leads to the full light of day. I now begin. Greetings to you all who have responded to the call of this issue to be here today. I acknowledge those who have passed, may you rest in peace. And to us who remain, welcome one and all. To pay tribute to these comfortable lands, I stand here, we the Government stands here acknowledging the present issue, greetings to you all, greetings, greetings one and all.]

It’s my privilege to support the second reading of the Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua Claims Settlement Bill. Second readings are an important opportunity and milestone in the legislative process. It signals that a bill has passed through the select committee stage while facing the scrutiny of the public; and for Treaty settlement bills it indicates one step closer towards reconciliation between the Crown and iwi.

I begin by acknowledging the people of Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua, many of whom will be watching this reading online. It’s been a long and incredibly difficult journey, but those people have shown real determination and persistence in supporting their settlement and its progression in this House. It’s important that we remember the real people behind bills like this. Their grievances are not forgotten; their desire to move forward with this bill is also not forgotten. I’d like to reassure Ngāti Kahungunu that this Government is in full support of them and their Treaty settlement bill.

Turning now to the consideration of the bill by the Māori Affairs Committee, can I just, first of all, thank the Māori Affairs Committee and its chair, Tāmati Coffey, for their very careful consideration of this bill, because there were some sensitive issues that were associated with it. There was a lot of interest—173 submissions in total were made. Submissions to the Māori Affairs Committee covered a range of topics and were varied in their levels of support. But these submissions illustrate a common occurrence in Treaty settlements, where differing and sometimes irreconcilable points of view must be balanced with the need to move forward. Some members of Rangitāne submitted on the claimant definition and that they did not agree with the inclusion of two hapū in the bill who are also included in the Rangitāne Treaty settlement. I wholeheartedly respect Rangitāne’s right to determine their whakapapa. That is a matter for them. Ngāti Kahungunu members of those two hāpu also told the Māori Affairs Committee that their hapū is both Rangitāne and Ngāti Kahungunu, I therefore don’t consider that it’s appropriate for those hapū to be removed. I understand that this will be disappointing to Rangitāne, but Ngāti Kahungunu have the right to have their whakapapa reflected in their Treaty settlement.

The Legislation Design and Advisory Committee also submitted to the Māori Affairs Committee, recommending the select committee request an explanation from Ministers as to why the Crown considers it appropriate to legislate this bill now. The Legislation Design and Advisory Committee’s guidelines state that “Parliament can pass legislation that affects existing legal proceedings if it is justified as being in the public interest.” After considering this bill and the views of parties very carefully, I believe progressing this legislation will enable the true start of the restoration of the Ngāti Kahungunu and Crown relationship, and that that is in the public interest. I’ll come back to this point a little later in my comments to the House.

Next, however, I’d like to thank all members of the Māori Affairs Committee, again, for their time and the care they took in examining the complex issues that were up for consideration in the bill—and their dedicated work to understand these fully before making their findings. The committee voted by majority to commend the bill to the House with only minor amendments. The amendments are technical points that do not change the substance of the bill.

I want to come back to the issue of the litigation that has surrounded this bill. As a consequence of the Legislation Design and Advisory Committee’s submission, the committee invited me to present to them about why, as Minister, I had introduced the bill and why it was important to bring this bill forward. As I’ve already touched on, that litigation has been continuing. The litigation started in the Waitangi Tribunal, it went to the High Court, and there is litigation currently before the Supreme Court that relates to that original litigation. To put that in context, I have to say the Crown has a policy of comprehensively settling historic Treaty of Waitangi claims; settling all claims of a group at once. This policy has existed for many years through all Governments and has been supported through many changes of Government. In almost every settlement, there are claimants who do not agree with the policy. In all of these cases, Parliament has accepted there is a balance to be struck.

As I’ve indicated, the House will be aware of extant litigation around the issues that are related to this legislation. The first relates to a 2017 application for resumption over land at Pouākani which includes Maraetai Power Station. The land at Pouākani is in the rohe of Raukawa and Ngāti Tuwharetoa. In 1915, the Crown gifted 20,000 hectares of land at Pouākani to Ngāti Kahungunu from Wairarapa in exchange for Ngāti Kahungunu’s land and lakes in the Wairarapa. In 1949, some of this land was then purchased by the Crown for the use of a power station. The gifting of the land at Pouākani to Ngāti Kahungunu is the source of great grievance for Raukawa. Parliament passed the Raukawa Claims Settlement Act in 2014, which included an apology to Raukawa for the Crown’s past failures to acknowledge the mana and the rangatiratanga of Raukawa. The Crown meant this apology, and it’s important that the Crown does not undermine that Act in 2014 now. The Crown’s actions back in the early 1900s also left Wairarapa Māori with their own grievances. They lost their land, their lakes, and many were left alienated in another iwi’s land. The Crown is trying to make this right through this settlement as well as through the Raukawa settlement.

The second issue relates to the Ngāumu Crown forest licensed land and was sought by claimants in 2018 on behalf of Ngāi Tūmapūhia-ā-Rangi who whakapapa to Ngāti Kahungunu. The Crown acknowledges there are multiple hapū with interests at Ngāumu, and the forest will return to Ngāti Kahungunu, as a whole, through this bill. The claimants of Ngāi Tūmapūhia-ā-Rangi will benefit from this settlement.

Despite a clear majority of Ngāti Kahungunu voting to proceed with settlement in 2018, the Crown opted to pause the settlement in light of the litigation, but the tribunal decided against these applications in March 2020. There is no ambiguity about the tribunal’s determinations. It said, and I quote: “We do not consider we should recommend the return to the shareholders of Pouākani of the 787 acres … because the value of that land and the [Incorporation’s] assets located there is not proportionate to the prejudice they suffered as shareholders in 1949.” The tribunal further said, “We are satisfied that the return of the land to Wai 85”—that’s the Wairarapa Moana Incorporation—“would not be a just outcome.” And also, “We do not think it is appropriate to return land and compensation to Ngāi Tūmapūhia-ā-Rangi.” These findings have not been challenged in the subsequent court proceedings in the High Court and in the Supreme Court. The Supreme Court has not been asked by any party to find that the tribunal made a mistake when it decided the return of the land sought was a disproportionate remedy to these claims. The Supreme Court is considering the relevance of manawhenua interests to the tribunal’s resumption decisions, as well specific matters relating to the statutory scheme for resumption of Crown forest licenced land. We are still awaiting the Supreme Court decision.

The crucial point is the litigation before the court doesn’t involve any challenge to the tribunal’s earlier determinations, which is that the claimants pursuing resumption are not appropriate recipients of the resumable assets and the assets are disproportionate to their claims. It’s simply not conceivable that the remedies that the litigants seeks would be awarded to them. In order for that to happen, the Waitangi Tribunal would have to abandon the principle of stare decisis. On the basis of this obvious fact and the determination of Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua, it is in the public interest that we proceed to pass this legislation.

My view is that the balance is in favour of ending further delay and bringing the benefits of comprehensive Waitangi settlement redress to all of Ngāti Kahungunu. This is why I stand here today asking Parliament to support the bill. I am hopeful that the bill is an opportunity for all of us to move forward towards a true partnership, one that is based on cooperation, mutual trust, and respect for Te Tiriti o Waitangi and its principles, and I look forward to hosting Ngāti Kahungunu for their third reading at the Parliament. On that note, I commend this bill to the House. Nō reira, tēnā koutou, tēnā koutou, tēnā koutou katoa.

DEPUTY SPEAKER: The question is that the motion be agreed to.

JOSEPH MOONEY (National—Southland): Thank you very much, Mr Speaker. I rise on behalf of the National Party, as the National Party’s spokesperson for Treaty negotiations, to speak on the Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua Claims Settlement Bill, for its second reading, following the select committee process.

This has been a challenging bill in a number of respects, and the Māori Affairs Committee, on which I sit, has heard a significant number of submissions on this bill. There has been a total of 173 submissions on the bill; of those, 93 were in opposition and nine had no position. Many of those submissions were mainly in relation to remedies litigation and the inclusion of Wai 85 and Wai 429 claims in the bill while this is still subject to litigation in the courts. The National Party had concerns, which we expressed in the select committee report back to the House, in respect of extant proceedings in the Supreme Court that have not yet been decided upon or where the Supreme Court has not yet released a decision. The advice from the Legislation Design and Advisory Committee was that legislation should not generally interfere with the judicial process, particularly if there are cases before the courts, and that good legislative design will say that, if legislation is being considered that may overturn a court decision or alter the law at issue in existing proceedings, such legislation needs to be justified as being in the public interest and no more than is reasonably necessary to serve that interest.

Having said that, the National Party is very much supportive of Ngāti Kahungunu having its claims settled. It has been a longstanding policy of this Parliament, through different iterations of Government, that these matters should be settled in what’s called the large natural group policy, involving a process of comprehensive Treaty settlements. This has been the way these settlements have been dealt with and have been resolved over many, many years in this House, and the National Party is very much supportive of that process. So the National Party will be supporting this bill through the House, but we will be putting on record some concerns in respect of the way that this has proceeded. I do note, however, that the issues before the Supreme Court are whether the mana whenua position at Pouākani constrains the tribunal recommending transfer to Wairarapa Māori, and what Crown conduct is relevant to the tribunal’s decision whether to apply a penalty interest rate to see if there was land compensation under the Crown Forest Assets Act.

The basis of the appeals to the Supreme Court does not bear, however, upon the essential finding of the Waitangi Tribunal that the assets are a disproportionate remedy for the Wai 85 and Wai 429 claims and that the incorporation’s structure makes an inappropriate recipient of resumable assets, with shareholdings rather than whakapapa determining the level of benefit. I note that the point regarding the assets being a disproportionate remedy for the Wai 85 and Wai 429 claims was not appealed. In effect, what we would see here is that even if there were to be success at the Supreme Court on the issues that have been appealed regarding the mana whenua position, that would mean that the matter has to be remitted back to the Waitangi Tribunal, and what would be sought there would be to obtain a different decision from the Waitangi Tribunal from the one originally given on the issue of the resumable assets being disproportionate to the claims brought by the Wai 85 and Wai 429 claimants. So there is real public interest here in these matters being resolved. Ngāti Kahungunu have made it very clear that they want to see this resolved and completed so that they can move on with obtaining better outcomes for their people.

In respect of the Wai 429 claim, it’s been made clear to us, in the information given to the select committee, that Ngāi Tūmapuhia-ā-Rangi are not the only hapū with interests in the Ngāumu Forest, and the settlement trust are prepared to work with the hapū to ensure they have kaitiaki rights in the areas of Ngāumu that they have the strongest interests in. And I note that while the tribunal considered that the Crown had engaged in a flawed and unfair process in proceeding to settlement, the Crown does need to balance a range of often competing interests, including prejudice from further delay to the interests of the broader iwi who support the settlement and others such as Rangitāne and Raukawa affected by the ongoing litigation.

It is certainly true that the reality is that, in almost every Treaty settlement, there is disagreement both within the settling group and between the settling group and those overlapping interests, and the path to settlement is rarely smooth; it is often fraught, and a desire to fully resolve every dispute about the best way to settle claims—in particular, in this case, as to whether the tribunal’s recommendation or a negotiated settlement is the better course—must be balanced against the real risk of endless delay to deserved redress. The Minister, the Hon Andrew Little, did explain to the parties—and he explained to the House today—why, in his view, the balance is in favour of ending further delay and bringing the effects of comprehensive Treaty of Waitangi settlement redress to all of Ngāti Kahungunu and that this has guided the decision to proceed to introduce and to take this bill through the House. There is real benefit to Ngāti Kahungunu in that, and something that the National Party is very much in support of is Ngāti Kahungunu being able to come to finality on its Treaty claim.

In respect of another issue that was raised, I acknowledge that members of Rangitāne made a number of submissions about whakapapa and the attribution of specific hapū to Ngāti Kahungunu in this bill based on subsequent intermarriage of Rangitāne tīpuna with Kahungunu. And given that both Ngāti Hāmua and Ngāti Te Rangiwhaka-ewa are already listed in the Rangitāne Tū Mai Rā (Wairarapa Tamaki nui-ā-Rua) Claims Settlement Act 2017, we certainly hope that can be fully recorded and publicly available during this current process to provide context for all members of these hapū, because I note those two hapū are both in Rangitāne’s settlement Act of 2017 and also in the present bill before the House. There are differing views of that, and those have been reflected in the two settlement Acts—in this case, a bill that will become an Act.

So I do certainly acknowledge and thank all of the people who did make their submissions to the select committee. I can assure them that they have been very carefully considered by the members of the select committee and by the National Party. We do wish to see this proceed in a way that can settle all of the issues for members of Ngāti Kahungunu and ultimately look towards the future to unlock the economic potential and boost the area of interest for Ngāti Kahungunu, noting the great contribution that that iwi makes to this country. I will have an opportunity to speak in more detail on other aspects of this bill at the third reading, and with that I will say that the National Party does recommend this bill to the House.

TĀMATI COFFEY (Labour): Thank you, Mr Speaker. It’s a pleasure to stand here as the chair of the Māori Affairs Committee to give the second reading of this, the Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua Claims Settlement Bill. Just for context, we in Te Arawa have a very close relationship to the people of Ngāti Kahungunu; it’s a very close one. I’m a descendant of Tūhourangi, and Tūhourangi had a relationship and children with Rongomaipapa. Rongomaipapa was the daughter of both Kahungunu and Rongomaiwahine. Our connection goes back a long way. I just wanted to point that out because it’s really significant.

The whole way through—that we were listening to submissions—we heard time and time again about the history of the people of Kahungunu, specifically from that area. The thing is, in that area, there are no big walls, you see. So there was a free flow of people, of family, of whakapapa between the area that is firmly on the eastern coast side and the area just over the hills. What we heard, time and time again, was that interaction that had gone on between both the people that lived in Tamaki nui-ā-Rua and the people that lived over on the Kahungunu side—there were a lot of people that came through and they talked about how they were both: you can be Rangitāne over on that side, but you can also be Kahungunu on that side too. It just depends on which part of the whakapapa you want to pull that ancestry from. But we heard, time after time in submissions, that people were very concerned about this.

I’ve got to be honest: a large part of the claims settlement bill is actually pretty non-controversial. There’s a lot of it that all parties agreed to, but there were a few contentious points, and the previous speaker, Joseph Mooney, noted some of those. The Minister, the Hon Andrew Little, noted those as well. But it’s very hard for us as a select committee to think that we are some kind of adjudication panel on what whakapapa looks like, because we’re not. And, in the submissions hearings, that came through time and time again, where we had to say to whānau that were talking to us as though we were going to determine whose whakapapa was right and who was more senior and who wasn’t—we had to reiterate time and time again that that’s not our job, and it should never be the job of this House to be able to decide what whakapapa it looks like. But we have to reach a resolution because we have to honour the good faith in which the people of, in this case, the Ngāti Kahungunu settlement trust entered into this, and it’s been going for a long time.

So we had to go way back into the history to understand the history, first and foremost. Then we had to understand the hearings process that they went through; the reports that were given as part of that; the Waitangi Tribunal decisions that were made as part of that; the Supreme Court litigation which overlays all of that. It makes it a really confusing story, but we are charged with the job of moving this bill through the House to be able to give closure to some of the wrongs of the Crown from the past. And it’s really important for everybody in this House to note that, as we talk about this settlement—and we’re coming up to the third reading—it was actually the actions of the Crown that left the people of Ngāti Kahungunu between a rock and a hard place. Essentially, they were uprooted and told by the Crown they had to move: “Sorry, you fellas, you have to move; all of you guys all over here, you’re all going to have to move. I’m going to have to send you 15,000 kilometres up the road. We’ve got some land for you up there.” And that’s exactly what happened.

So the people left their hau kāinga, they left their whenua, and they had to go all the way—well, a part of the tribe were relocated, re-dispatched into another tribal area, Ngāti Raukawa. So you can imagine their reaction when Ngāti Raukawa said, “Oh, well, what are you guys doing here?” And there’s Ngāti Kahungunu saying, “Oh, well, actually we got given land here by the Crown. We’re here now.” You can understand that all of this complexity came through in the submissions. All of the history that the Crown has bestowed on the people of Kahungunu came through in those submissions hearings. There was re-traumatisation in that, there was pain, there was heartache, there was whānau fighting whānau through that process, too. And, unfortunately, that’s what the Treaty settlement process does. But we have to have good faith in this, and I believe that what we’ve done as a Māori Affairs Committee is to the best of our ability.

We took the opportunity to invite the Minister back into the committee so we could ask some questions ourselves. We made it a closed session so that there wasn’t any politicking. There was no media involved. It was just an opportunity for us to sit there and ask questions of the Minister about this interesting position that we found ourselves in, where, essentially, the parliamentary process has been enacted whilst there’s still a Supreme Court decision waiting to happen. So we had to ask that question: why are we doing this? Why are we not waiting? And the Minister came and he fronted up and we all got a really good chance to be able to ask questions. The decision was that he said we have to push forward on this. There’s a lot at stake. There’s a lot of people that have put a lot of time into this. And, of course, we want to get it right but, in his words—and I noted them down when he actually said them himself—he said, “There are differing and irreconcilable positions that sometimes get made.” And that’s the position that we found ourselves in.

I believe that we’re doing the right thing here. I believe that there will still be parties that will be disaffected by this and they won’t be happy with the decision to proceed past the second reading on this. There had been many submitters, that day, submitting on the fact that they wanted to see a couple of these big areas taken out of the settlement bill. We acknowledge them; we acknowledge all of the stories that came through. And they may still choose to take action off the back of this decision. But it’s our job as select committee members to take a step back and actually to look at the whole picture, and to try and—as the Minister said—balance it all up. What we know is that it was the Crown’s wrong. When we come to the third reading, and when we finally travel to Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua, we’ll be able to stand there and read the apology in front of their people, to try and put to bed some of the hurt and pain that we heard through the various submissions. But that’s the goal: that we can actually address the wrong—not forget it, not forget it at all—and try and let Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua get on with their lives.

There was one submitter who fronted up and he brought photos with him, and it’s very hard when you get the photos, because the photos represent people that have passed on. That’s exactly what the message was that he wanted to send to us. He said, “This has been going on for far too long.” He said, “This is my family here. This is my parents. This is my sibling.” He said, “They all started this journey and they’re all dead. And I’m here to tell you that this needs to move on because we can’t wait any more. We can’t wait any more. I don’t want to be another photo on this table while we go through a court process and another parliamentary process to do that.” He said, “Get a move on. We’re none of us getting any younger. We’ve got the heart to want to do the right thing by our people. Give us the faith to be able to do this, and then let us make decisions on what it is that we see as being rongoā for the iwi after the travesties, unfortunately, of the Crown in days gone by.”

So the day that we had finished the select committee hearings, I walked away and that was the one submission that stuck in my head—the fact that there were all of these kuia, kaumātua, uncles, aunties that had all passed on. And I looked at that room and I thought, if we take any more time, who’s next? Who’s next for the table, you know? And, unfortunately, it’s taken too long already. So to that submitter, I want to say that I heard, and our committee—we’ve decided that it is the right thing to move forward on this and acknowledge that not everybody is going to be happy, but it is the right thing to do. And I look forward to the third reading when we have our whānau from Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua here in the gallery. Third readings are always the end of this parliamentary process for us but, for them, it’s the start of their journey. It’s the start of their journey to be able to receive the cultural redress, receive the financial redress, start organising themselves, start setting some goals into the future about what they want to do with that money, start making some real hard decisions about what they consider to be the fix—the fix to the problem that the Crown started many, many years ago. I look forward to that time in the third reading. For the second reading, though, I do commend this to the House. Kia ora.

CHRIS PENK (National—Kaipara ki Mahurangi): Thank you, Mr Speaker. I’ve been listening carefully to the debate and found the contribution by the member who’s just resumed his seat, Tāmati Coffey, the chair of the Māori Affairs Committee, quite moving in his description of the desire of many involved and affected to move on and to be allowed to move on. I do want to acknowledge, of course, as others have already done, that the process is not perfect. The outcome, in the eyes of some, will be somewhat less than perfect, and we can acknowledge that in the context of the litigation that is now still ongoing. But I think the chair of the committee puts in very real and, frankly, helpful terms the desire that is heartfelt from the point of view of those who wish to have closure in the sense of this legislative process in order to be able to open a new chapter going forward.

He’s spoken a lot about the process from the point of view of the select committee. I didn’t sit on that select committee, so I’ve listened carefully to this debate so far, as well as its first reading, and been made aware of some of the discussions that have taken place. I know that we’ll hear from other members of the select committee, including my colleague and friend Harete Hipango, in addition to having heard already from Joseph Mooney on our side of the House, and I think it’s really important.

Sometimes, process is almost as important as the substance of the outcome, and I think it demonstrates a good-faith approach to lawmaking—in this case, what is, in many ways, a negotiation of a commercial nature, albeit that it is, of course, much, much more than that. I think the good-faith basis that is reflected in the process is important because there will be some people who are ultimately dissatisfied with the outcome. In order for them to feel that their view wasn’t disregarded, albeit that it might ultimately not have prevailed—I think that’s important for the cohesion of those on the ground for whom this will be a very real part of their family, whānau, iwi, hapū, and, indeed, the life of the area moving forward.

Before I humbly offer a couple more reflections on those bigger themes before closing my contribution, I do want to acknowledge what is in the settlement. We’ve heard a certain amount about what is not in the settlement—and that’s appropriate, because it’s important, for the sake of the record, that the Minister first, and then other contributors to the debate, acknowledge the extent to which legislators have not been able to give effect to the desires of everyone involved, or potentially involved, in the process. But, nevertheless, it’s worth acknowledging and, dare I say it, celebrating the things that have been able to be concluded by way of agreement.

So, without delving into the detail entirely, I will say, in the legislative statement put forward by the Hon Andrew Little, we’ve seen reference to the deed of settlement that does rely on the legislation. That’s the point of us being in this House, Parliament—being outside the negotiations on the ground, beyond the select committee, and in the place where laws are made to give effect to what has been agreed. Of course, the purpose is to finally and comprehensively settle all the remaining historical Treaty claims of Ngāti Kahungunu, so that’s an important matter. It almost goes without saying, but I think the Crown’s acknowledgment of the wrongdoing—indeed, the breaches of the Treaty of Waitangi, Te Tiriti o Waitangi, and its principles regarding those people—is important, not only because we get to dollars and cents at the end of the process but, along the way, the cultural redress, obviously, is part of that. I understand—and forgive me, again, speaking to process, but I understand that the issuing of a couple of protocols by the responsible Minister will follow this process in order to give effect to that which has been decided.

Geographic place names: I understand we’ll allow some 30—three zero—geographic place names as listed in the relevant clause of the deed to be put forward, and that will feel significant to some in that part of the world, and good luck to them. I see as well, actually, interestingly, right of first refusal over land, defined as such, within the Ngāti Kahungunu area of interest for a period of 170 years from settlement date. No doubt, those involved will understand why that’s a significant period of time.

So having addressed, at least to that high level of detail, that which is in, it’s appropriate to acknowledge that which is not in. Specifically, for those who have sought inclusion by way of litigation—and, I understand, it is before the Supreme Court even as we speak—we’ve heard from the Minister his reasoning that such a claim would be unlikely to succeed without a departure from what he has described as stare decisis or the doctrine of precedent. In other words, it would be unprecedented, quite literally, for the action to succeed. And so while this House shouldn’t lightly pass laws in the area that looks, on paper, as though it’s very much similar to that being considered by a court of this land, nevertheless, I think we should take some comfort from the Minister and take him at his word that he’s been advised and has made a judgment call that, as much as it’s ever possible to be certain about the outcome of litigation, it’s unlikely that that result would cut across the decision, effectively, being made by Parliament in a parallel process.

All previous contributors to the debate have talked about the determination of whakapapa not being within the role of this Parliament. That’s right. That’s something that can neither be given nor taken away by us as parliamentarians; that is inherent to a people themselves. And so, of course, at the risk of stating the obvious, we confine ourselves to understanding what can best be done to acknowledge the rift in the relationship but to do as much as possible, at the same time, to repair the relationship between Crown and those affected by the actions nearly two centuries ago.

My final remarks would be along the lines that, while it’s sometimes sad to say, we should not allow the perfect to be the enemy of the good, and an aspect of that is the philosophy that the Minister has rightly outlined already in relation to Treaty settlements. Oftentimes, large groupings are preferred because it advances the cause of settling claims, as opposed to having unsettled claims, uncertainty, and a lack of access to resources, quite frankly, so a balance is needing to be struck. I should probably mention in passing, as well, as others have, too, the view that’s been expressed that the claims by others who have ultimately found themselves outside the tent—and I should probably use that phrase gently. But the claim that has been made by those in that position could risk being viewed, in a way, as being disproportionate to other Treaty settlement claims that have been made, and, therefore, there’d be a risk that we would be taken backwards and not forwards in the Treaty settlement process as a whole for New Zealand.

So, adopting the words of our colleague the Māori Affairs Committee chair, for those who have found themselves between a rock and a hard place, that can sometimes be an uncomfortable position, but if there is to be closure, then we hope that smoother paths will lie ahead that way. And so, on this side of the House, taking it all into account, the National Party does continue to support this bill.

GINNY ANDERSEN (Labour—Hutt South):Tēnā koe e te Māngai o te Whare. E mihi ana ki a koutou kua tau mai nei i runga i te karanga o te kaupapa o te rā. E mihi ana ki te hunga mate, haere, haere, haere atu rā. Ki a tātou te hunga ora, tēnā tātou. Kia whakamānawatia ngā mana o ēnei whenua e tū āhuru nei. Nō reira, tēnā koutou, tēnā koutou, tēnā tātou katoa.

[Greetings, Mr Speaker. Greetings to you all who have responded to the call of this issue to be here today. I acknowledge those who have passed, may you rest in peace. And to us who remain, welcome one and all. To pay tribute to these comfortable lands. Therefore, greetings, greetings, greetings one and all.]

It’s my privilege to support the second reading of the Ngāti Kahungunu ki Wairarapa Tāmaki-nui-a-Rua bill, and during the time I was lucky enough to sit on the Māori Affairs Committee and hear submissions, it reminded me about what a hard and gruelling process the Treaty settlement process is.

I’d like to first acknowledge the people, which is what this bill is about—the people behind this legislation. Their grievances are not forgotten; in fact, they are etched in this bill. Their desire to move forward with this bill is also not forgotten. I would hope to let Ngāti Kahungunu know that this Government is in full support of this bill, and for them moving forward.

I remember back to my first days working in the Office of Treaty Settlements, and I remember a publication that we would refer to in the policy document, called Healing the past, building a future. I think now, after a few years around the traps—I think how presumptuous that statement is, because no one can assume to heal the past; those grievances are carried forward. But we can hope to build a future, and I hope that that’s exactly what this bill does.

I would like to acknowledge the interest that we got on the bill: 173 submissions made in total. The submissions covered a wide range of topics and were varying in levels of support, but the submissions illustrated a really common occurrence in Treaty settlements, where there are different, differing, and sometimes irreconcilable points of view that must be balanced with the need to move forward. I’d like to acknowledge all of those people who gave their time, energy, and aroha through the submissions process.

Some members of Rangitāne submitted on a claimant definition—they did not agree with the inclusion of the two hapū, and it was really heart-wrenching to hear the views from both sides in and around that issue. I’d just like to state that we fully understand those views of Rangitāne, in terms of their right to determine their own whakapapa.

I’d like to just acknowledge, also, what my colleague Tāmati Coffey referred to in terms of the outrageous actions of the Crown. The lands at Pouākani are Raukawa and Ngāti Tūwharetoa rohe, and the Crown gifted 20,000 hectares of land at Pouākani to Ngāti Kahungunu from Wairarapa—miles away—in exchange for their land. In 1949, some of this land was then purchased by the Crown for the use of a power station. The gifting of the land at Pouākani to Ngāti Kahungunu is a source of great grievance for Raukawa. Parliament passed the Raukawa Claims Settlement Act back in 2014, which apologised to Raukawa for the Crown’s past failures to acknowledge the mana and the rangatiratanga of Raukawa.

This Crown’s actions, back in the early 1900s, also left Wairarapa Māori with their own grievances. They lost their land, their lakes; many were left alienated in another iwi’s land—outrageous. The Crown is trying to make up for this through the settlement. It can never repair the damage done, but let’s hope that this paves the way forward for further generations of Ngāti Kahungunu to go forwards.

I would like to conclude by saying that Treaty settlements are never easy; they are painful processes. I’m really hopeful that this bill is an opportunity for all of us to move forward to true partnership; one that’s based on cooperation, one that’s based on respect, and also some trust—I hope we’re able to build that. I hope there’s respect and trust built for Te Tiriti o Waitangi in its principles, and I look forward to Ngāti Kahungunu coming back here for the third reading of their bill to see this finally passed, and so we can move forward together. Nō reira, tēnā koutou, tēnā koutou, tēnā tatou katoa.

Dr ELIZABETH KEREKERE (Green): Tēnā koe e te Māngai o te Whare. Tēnā koutou katoa i raro i te mana o Ngāti Kahungungu ki Wairarapa Tāmaki-nui-a-rua.

[Greetings, Mr Speaker. Greetings to all of you representing Ngāti Kahungungu ki Wairarapa Tāmaki-nui-a-rua.]

I rise on behalf of the Green Party to speak to this bill, the compendium bill for the Te Rohe o Rongokako Joint Redress Bill that we considered last week. It gives effect to the final settlement for the historical Treaty claims of Kahungunu ki Wairarapa Tāmaki nui-a-Rua and the Crown. Thank you to all the whānau, hapū, and iwi organisations who submitted in person and in writing. We saw strength and passion. We felt their mamae and the anger in the room. We held the hearings for this bill in August here in Parliament. It’s a very different feel when you hold it here and not in a marae. We’ve also met with and had contact with many members of the whānau who are involved in this. I acknowledge our chair, Tāmati Coffey, in the Māori Affairs Committee. That is not my usual committee, so I thank them for having me join them for these two bills. I really appreciate hearing our chair acknowledge the fault of the Government in this and the very real grievances that have arisen from it.

In the hearings, we heard from the Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua how those successive Crown actions over nearly 180 years have impacted on them, leaving them virtually landless. A fulsome apology is the absolute minimum that they need to hear, along with the appropriate redress. I’m pleased that they’ve been able to come to this settlement. I think it’s not nearly enough. They could at a minimum double or triple that amount, and it still wouldn’t make up for it, but I’m glad that we’ve got somewhere—we’ve got to this point. It just enables them to keep moving, to do the things they want to do for themselves.

We also heard from the settlement trust how long and how hard they’ve worked on this. You know, that work started many, many moons ago, and it shouldn’t take over two decades to get to this point, but we know how common it is. We heard the impact the settlement would have, though, once that money’s in the bank, and that land is there to ensure that our—not our, but their; I do have connections to te Kahungunu—tamariki and mokopuna can flourish, that their whānau flourish to grow businesses, develop their whenua, build houses, strengthen their papa kāinga, and develop a better relationship with the Crown, one on a much more even footing. And we definitely want that for them too.

As with every settlement bill, others have talked about some of the tensions and some of the issues that arise because of it. But we heard of the efforts the trust went to to try and resolve those themselves over, again, several years. We heard how they were aiming for equitable outcomes for everybody and just trying to make sure that they had those conversations. What we heard in the hearings is that those many issues are still not resolved. We particularly heard about the concerns about the resumption applications, how that would hold up this bill potentially for years, and that was not something that they were prepared to put up with—not something that they wanted at all.

So one of the areas of contention was around whakapapa with the links to Rangitāne. I think it’s impressive that of a list of 110 hapū that is in the schedule of this bill, only two were really in contention: Ngāti Hāmua and Ngāti Rangiwhakaewa. I’m just noting that I’m aware that Rangitāne spoke very eloquently that their preferred pronunciation is Te Rangiwhaka-ewa, in terms of how they prefer to name their tupuna. We note that both of these hapū are already listed in the Rangitāne Tū Mai Rā (Wairarapa Tamaki nui-ā-Rua) Claims Settlement Act 2017. And we understand that Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua did not dispute the inclusion at the time, because the agreement was made, back then, that those hapū would appear in both. And it is absolutely the prerogative of members of Rangitāne to not agree with that original decision that they be shared or to change their minds because they’ve gotten more information since. We did raise this in select committee. However, this bill will go through with them listed—as originally agreed.

Now, I spoke about this last week in the joint redress bill, and, actually, I have to issue an apology to Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua, because I misspoke when I was in this House. I said that one of the things that people at the hearings were in agreement with was that Te Rangiwhakaewa was a Rangitāne tupuna, but that was incorrect—I mixed up the names. I’m really, really sorry—because that is disputed. I meant to say that there was general agreement that Hāmua was a Rangitāne tupuna, as stated by Rangitāne Tū Mai Rā Trust. I apologise for the upset that this has caused, and I thank those who brought it to my attention. This perfectly illustrates my point that it is not the job of MPs or this Parliament to determine whakapapa. We will never catch up with the years and decades and centuries of whakapapa that has been handed down to those who are now the experts and who are feeding into this process. It also illustrates that the Crown could have done more to help resolve those issues at that level before it came here so that those disputes had to be aired in front of all of us—because they’re recordings which will last for a long time—in front of everybody. I know that some things, though, are absolutely worth fighting for. And as submitters said, the kōrero around whakapapa is not about money; it’s about identity; it’s about mana.

We heard how successive Crown errors and misjudgment continue to rebound on Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua. In particular, the Wairarapa Moana ki Pouākani Inc. spoke about their Wai 85 claim and how they wished that it would be withdrawn from the bill—removed from the bill. We heard from Ngāi Tūmapuhia-a-Rangi about their Wai 429 claim, related to Ngāumu Forest, and how that should be withdrawn from the bill. Regardless of the content of those particular claims, by proceeding to settlement, the Crown will extinguish the Wai 85 and Wai 429 claims as part of this bill. And so there are implications of such actions on the constitutional arrangements for other hapū and iwi, and we’re really worried about that.

To our knowledge, it is unprecedented for the Crown to introduce legislation that, once passed, will extinguish the rights of any party with a case in front of the Supreme Court. We must remember that the Crown is not neutral here; they have a clear conflict of interest because they have a financial interest in the outcome. In terms of Wai 85, we acknowledge it is also a grievance for Ngāti Raukawa, who lost land at Pouākani because the Crown decided to transfer it to Ngāti Kahungunu ki Wairarapa many years ago. We note that the Government—and the Minister said it in his first kōrero tonight—issued an apology to Ngāti Raukawa for that at the time, but they’ve decided to deal with it in this bill. We’ve often spoken against the practice of large natural groupings, and we feel it stretches it well beyond reason to include whenua from a completely different iwi.

As we do every time we speak on a settlement bill, we acknowledge that the claims settlement process is deeply, deeply flawed because it enforces Crown control at every stage, it often undermines whakapapa and mātauranga Māori, and it’s designed to pit iwi and hapū against each other—often invisiblising them. So we do not consider the settlements to be at all fair, full, or final. But during these hearings, one submitter Mr Potehoki showed us a photo of his dad and his dad’s siblings. He asked, “How many more must die?” Hopefully, no more. No more. We all want this for Ngāti Kahungunu. This bill is going ahead, so Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua is another step closer to settling. We continue to have major concerns with the actions of the Crown, so we must continue to abstain for now, but we wish only the best—only the best—for Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua. Tēnā koutou katoa.

KAREN CHHOUR (ACT): Thank you, Mr Speaker. It’s a pleasure to rise on behalf of ACT to support the Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua Claims Settlement Bill.

I’m by no means an expert on settlements, and, being Māori myself, I was not privileged enough to hear from my grandmother the stories, which I’m sure there were many. But I had a thought about, “How could I relate to this and understand this: the pain and the anguish that the generations feel hearing the stories from the past and the wrongs that have been done to them?” I understand history is important and stories being passed down from generation to generation—and keeping that alive and making sure that nobody forgets the pain that the last generations went through—is really important so that we don’t forget and that we don’t repeat history.

Every person in New Zealand deserves to be treated with equality before the law, and they deserve to feel that their property rights will be protected. Unfortunately, this didn’t happen and the Crown did not meet their obligations under the Treaty when it came to Ngāti Kahungunu ki Wairarapa. It’s happened multiple times across many different iwi, and I think it’s really important that we have these conversations here in Parliament to acknowledge the wrongs that have happened.

I’m actually really proud to be standing here in a country that is willing to have these conversations—that is willing to go back over 30 years with Governments and politicians from all across the board—to acknowledge this and to try and right the wrongs. No amount of money and no amount of redress will completely take away the pain and take away what has happened—we’re not trying to do that.

What we’re trying to do is help people to move forward and see a better tomorrow. And part of the healing process—when you have been victimised and when you have gone through something as terrible as this—is actually having an acknowledgment that you were wronged. I think it’s really important that we acknowledge that wrong was done here, and I’m grateful that that process has started.

The injustices of the past, I cannot comprehend. I sit in a household where I’m married to somebody whose parents had horrific injustices of the past. I listened to the stories and I listened to the history and I listened to the pain and I listened to what has happened, and I see in my household how that affects the next generation and how they live their lives—and the generation after that. But I also think it’s important that those conversations happen, and we keep it going. We must acknowledge it, because if we don’t acknowledge it, there’s no way to move forward and there’s no way to see a better future.

I’m very grateful to the Māori Affairs Committee, who went in in good faith—listened to the people who came forward—and came here and gave very good explanations to what was brought forward before the select committee, and I’m grateful for that.

I feel for those who have lost people before we got to this stage, and I hope that the next generation that has carried this on—and has got this to this stage—realises that the past generations will be proud of the fact that you’ve carried on their fight to be acknowledged and to try and get some kind of redress for the wrongs that happened in the past.

We support this process and we’re very grateful for the hard work that the Māori Affairs Committee has done. And with that, I support the bill.

ARENA WILLIAMS (Labour—Manurewa): Mr Speaker, tēnā koe and tēnā koutou to the members of Ngāti Kahungunu who may be watching this online today. It’s a real pleasure to rise and speak to what is the second reading of this bill that makes up part of the process for the settlement between the Crown and Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua. This speech from me will be technical. It’s the first opportunity that I have had as a member of the Māori Affairs Committee to comment on the work of the select committee, which has been broad and wide ranging into the history of how we came to this settlement.

So let me take this opportunity to comment on the history of how we have come to this bill over what has been, broadly, a 200-year process to get to this point and to say that I hope I get to speak in the third reading of this bill about the more substantive elements of this settlement. The select committee’s work on this bill—really, we did need to focus on the history of it and how both the negotiations between the Crown and this part of Ngāti Kahungunu had come to be, but also how those breaches of Te Tiriti o Waitangi that the Crown committed had led the Crown to negotiating this in the first place. Because this rich historical tapestry that the committee uncovered through the select committee process—through advice from officials, which was very, very helpful, and the very useful submissions of the various groups that have an interest in this—is really important.

It began in 1845 during the Crown’s first encounter with Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua, where the Crown pre-judged their guilt in what was a dispute with settlers and forced Ngāti Kahungunu, in response, to cede tens of thousands of acres at Maungaroa with threats of armed violence at that time.

During the late 1840s and early 1850s, the Crown threatened to end Pākehā settlement in Wairarapa and Tāmaki nui-a-Rua unless Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua sold their land to the Crown and gave up what were then pastoral leases, which were providing that hapū with income and trade benefits whilst retaining ownership of the land. So this history starts with misunderstandings that resulted in huge land losses for a people who were cooperating with settlement in their area and who wanted the economic benefits of that.

By 1853, the “Chiefs and people of Ngatikahungunu” signed the Castlepoint deed, which is their first land sale to the Crown. And in that year, Governor George Grey met with the Komiti Nui, which was the large meeting of Ngāti Kahungunu, to hear plans for future land sales. Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua were led to expect substantial educational, health, and economic benefits from settlement as the real payment for land sales, and the Crown agreed to use some of the profits it made from on-selling certain lands to provide a koha fund to be managed “in committee” with Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua in settlement of some of these benefits. That didn’t happen. In fact, immediately following that agreement, the Crown purchased approximately 1.5 million acres, well over half of the traditional rohe of Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua, and those obligations continued not to be met further into the 1860s and early 1900s. From 1866, the Native Land Court operated in Wairarapa and Tāmaki nui-a-Rua determining the ownership of Māori land and converting customary title into title derived from the Crown, a process which resulted in further land losses for those people.

Fast forward, then, to the process which we are in today. In 2012, this document was signed and agreed—it’s the deed of mandate—on behalf of Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua. And in this deed of mandate—this is a process which has come to be a part of Treaty settlements, where we agree who represents who, at the table, who’s in a Treaty settlement. So, much of what the select committee was having to consider at this juncture was actually on the table then. It was: which hapū are within this group who are being represented? It was discussed then in a process which went around the rohe and involved claimant groups from the marae who are involved. It named those hapū that we are still having debate about at this point. It has gone around the traps since then. So it’s useful to understand how that document kind of came to be, which was this iterative process that began then.

That took about four years to get from that deed of mandate ratification process to, then, the Crown and the trust signing an agreement in principle. That sort of document is about this long. [Holds up a thick stack of paper] You’d think that an agreement in principle might be a heads of agreement and a short, wee thing. But, actually, a substantive amount of the agreement, about the lands that would be settled with the Crown, about what sort of area the Crown was discussing, and, again, the hapū that were involved and the people who would ultimately be represented—that was agreed in 2016.

Then we run into the trouble that a number of my colleagues have discussed today and was at issue in the select committee’s determinations. I think the Minister did a very good job at summarising for the House those issues that we were discussing, but they really come down to these two Waitangi Tribunal claims, Wai 85 and Wai 429.

It’s useful, I think, for the House to understand the select committee’s process when we considered these things. We were always aware that there was a potential for the select committee to be making recommendations to the House which included issues of legislative rights which might have been extinguished. It was incumbent upon all select committee members around the table to make sure that we understood exactly what those rights were if we were going to recommend to the House that they were extinguished.

Now, my process for going through those decisions was to ask the submitters. I asked the representatives from those Waitangi claims what they thought those rights were and what they thought their paths to resumption were. It was important for all select committee members to be able to do that, but what was most important was to be able to ask the Minister to further explain his rationale for determining that there wasn’t a path forward for those resumption applications.

If you’ll just indulge me, Madam Speaker, I will give you some of the reasons that the Minister gave us for his determination that, on balance, the path available to those claimants in the courts needed to be considered in light of these other factors.

We were advised by officials that the Minister had taken into account that the settlement trust, who are part of this deed of settlement, made an informed decision to proceed to settlement and continued to support the settlement legislation being introduced before the Supreme Court hearing. That’s relevant to the select committee’s considerations because, as my colleague Tāmati Coffey said, we heard from these submitters that they want to be able to move on, that they do not want us to continue what has been an almost 200-year history of delay in realising the rights that these people, the tūpuna, thought they were getting from the Crown.

The second is a clear majority of Ngāti Kahungunu claimant community who engaged in the vote on the enhanced settlement package—so this is after that history that I took us through—voted in support of proceeding to settlement. This is after those claims were considered; Ngāti Kahungunu came back to the table, and they voted once again to proceed.

There had already been a three-year delay, since progress with the deed of settlement was deferred to allow the Wai 85 and Wai 429 claims to be heard by the tribunal. This was also a factor in deciding, for the select committee, what our recommendation would be. I think, on this point, the fact that there had been a delay in the opportunity to come to the table was an important one.

I would say that the select committee have really carefully considered our responsibility here to really carefully examine this legislation, inviting the Minister for Treaty of Waitangi Negotiations back to the committee—and also hearing his explanation today in the House about why he made those determinations are all part of why we, as a committee, are recommending to the House to support this bill. At its third reading, we will be able to traverse the benefits of the settlement package that we believe, on balance, are the right thing from the Crown to do, and that’s why I support this bill to the House.

ASSISTANT SPEAKER (Hon Jacqui Dean): I call Harete Hipango—five minutes.

HARETE HIPANGO (National): I rise as a member of the National Party and also I have the responsibility as spokesperson for Māori development. My colleague Joseph Mooney, as the Treaty settlement spokesperson, has addressed the House initially. In my role as the lead on the Māori Affairs Committee for the National Party, accompanied by my colleague, and cognisant of my role, in terms of Māori development, I take this call with trepidation, because there were a number of developments that were exposed and revealed to we members on the Māori Affairs Committee. These developments, the journey of Ngāti Kahungunu over a period of 30 years, to arrive today, the 22nd of the 11th month of the year 2022—now, if anybody follows numerology, which I don’t, there has to be something significant in that, with this being the second reading—another development.

So in the short call I have, there’s a lot to traverse, and I’ll try and encapsulate that with the trepidation that I stand here in addressing the House. The National Party caucus supports this bill going through, acknowledging Ngāti Kahungunu’s journey of 30 years. I know what this Treaty settlement negotiations process does to our people. Being of W’anganui—the W’anganui River claim being the longest litigated case in terms of a Māori settlement, having gone through the courts, having gone through negotiations with respective tribunals, negotiations with the Crown, and 128 years later—in the year 2017, I stood as a member of W’anganui tribal peoples up in the gallery at the third reading and the passage of our Te Awa Tupua (Whanganui River Claims Settlement) Bill into law. So I know full well the anguish, the anxiety, the mamae, the hurt, the history, and the journey that our people go on, and I acknowledge Ngāti Kahungunu for that.

However, mixed up in the turmoil of that journey, because the process that the Crown invokes and requires of our people to participate in to arrive at a negotiated settlement creates division and creates divisiveness—and when I rose and took a call last week on the Te Rohe o Rongokako Joint Redress Bill, I talked about the process where the Crown requires the interested parties to go into a process of negotiation with the Crown in having to compromise on significant aspects and elements of getting to settlement. The Crown facilitates negotiation; the Crown does not facilitate a process of mediation for the divisiveness that’s created amongst the interest groups. Our whānau, our hapū, our tribal people who all whakapapa are actually arguing and negotiating a better position for their particular interests, so I acknowledge Ngāti Kahungunu.

I also acknowledge the claimants of Wai 85, the Wairarapa Moana ki Pouākani Incorporation, and the claimants of Wai 429, Ngāi Tūmapūhia-ā-Rangi, who put their case and their claims to the Waitangi Tribunal, and the tribunal ruled and said that Ngāti Kahungunu did not have the necessary mandate from the two claimant groups of Wai 85 and Wai 429. As a result of that, that mamae, the raruraru, the conflict, the tension, the hurt that’s been created from that—because the Crown requires negotiating with a large natural grouping who has been identified, who in this settlement bill is Ngāti Kahungunu. The Crown has also seen fit that this bill is going to be progressed in advance through the House, whilst there are Supreme Court proceedings extant that have been brought by Wai 85, Wairarapa Moana ki Pouākani Incorporation.

Now, there have been different levels and layers and complexities of this journey for this bill. I’ve heard the Minister address the reasons that it is in the public interest for this bill to progress. I have also heard the Minister of Justice in this House merely two weeks ago stress the importance of, “I can confirm that this side of the House, the Government, the executive, understands the separation of powers. I can confirm that we, the executive, have the obligation to administer legislative tools and that we understand principles of comity.” So that has been one of the perplexing, conflicting issues that we, as members on the Māori Affairs Committee, have had to deal with. One second left—I’ll address the House further at the third reading; the National Party is supporting this bill thus far.

ASSISTANT SPEAKER (Hon Jacqui Dean): I call Debbie Ngarewa-Packer—five minutes.

DEBBIE NGAREWA-PACKER (Co-Leader—Te Paati Māori): Tēnā tātou i te Whare. Tēnā koutou Ngā[ti] Kahungungu ki Wairarapa Tāmaki-nui-a-rua, ko koutou te kaupapa i mua i a tātou.

[Greetings to all in the House. Greetings Ngāti Kahungungu ki Wairarapa Tāmaki-nui-a-rua, and your issue that is in front of us today.]

I stand on behalf of Te Paati Māori to make a short call to speak to support this second reading of the Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua Claims Settlement Bill. I recognise the mahi of the Māori Affairs Committee and, having attended their hui last week, I have confidence that they acted pono and tika, with empathy and dignity, respecting all the dynamics that make us uniquely us.

Ngāti Kahungunu ki Wairarapa, we recognise the disarray, the contentiousness, and hardness of all you have endured and are enduring. You resisted passively to protect your whānau, your lake, your tuna, your whenua. Numerous times you have been let down, and I mihi to you all for your absolute resilience and humility—a humility that many in Aotearoa don’t understand. Every day, hapū and iwi are settling in the interests of public good, and, hopefully, one day the public good will respect the sacrifices and resume the partnerships intended by our tūpuna and for our mokopuna.

Settlements are divisive, and we’ve heard that here this afternoon. They draw lines across w’akapapa—having to identify as groups, as one iwi, ignoring the displacements, the significance of our tūpuna and their many inter-relationships.

It’s hard not to, I guess, feel real aroha and taumahatanga that our many hapū and iwi are having to endure being forced into Crown processes—they often tell you when to walk left, when to walk right. Nowhere else do we see a justice system where the perpetrator determines the restorative process. Nowhere else do we see a justice system that awards those who lost 100 percent having to be compensated and settle for 1 percent. That is why we’ll never support settlements as being full and final, and we look forward to seeing you and your mokopuna coming back for the remaining 99 percent.

Treaty settlements are flawed. We will never repair the mamae of being forced to grow up on another iwi whenua, and the sense of displacement, the forcible removals, the forced conflicts that today remain unresolved, are painful to watch. I can’t imagine how it must feel when you ask yourself where are your haukāinga, where you tangata whenua, contribute in communities that aren’t your mara. We are also protective of what little mara we have, so that in itself is really hard to watch and endure.

We recognised that settlements are never about money; it’s about mana and it’s about whenua. Te Tiriti must be honoured, and this is an example of why. The dilemma the Crown has left, and, when we have our beautiful whānau and hapū having to reconcile through these painful differences, we must have hope that you are able to rebuild and reclaim. I mihi to Matua Haami Te Whaiti, the chair of the Treaty trust who’s been carrying this kaupapa since birth, and the kaumātua present and not present.

If nothing else, settlements are an opportunity for you to focus on you. For you to focus on you without Crown intervention, to reclaim your future, to remember what it’s like to work together, to reassert your own rangatiratanga, and, most importantly, to find your kotahitanga as whanaunga. We commend this bill to the House. Kia ora rā.

WILLOW-JEAN PRIME (Labour—Northland): E te Māngai o te Whare, tēnā koe. He hōnore tēnei mōku te tū i tēnei ahiahi ki te kōrero e pā ana ki tēnei pire, te pānuitanga tuarua o tēnei pire, Ngāti Kahungungu ki Wairarapa Tāmaki-nui-a-rua Claims Settlement Bill.

Tuatahi māku e mihi ana ki te Minita, i tū ia ki kōrero tuatahi i tēnei ahiahi, otirā ki ngā iwi e whai pānga ana ki tēnei o ngā pire i tēnei ahiahi.

[Greetings, Madam Speaker. It is an honour for me to stand this afternoon to talk about this bill, the second reading of this bill, the Ngāti Kahungungu ki Wairarapa Tāmaki-nui-a-rua Claims Settlement Bill.

Firstly, I’d like to acknowledge the Minister who spoke first this afternoon, and also to the iwi who have an interest in this particular bill this afternoon.]

Madam Speaker, thank you for the opportunity to take a call on the Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua Claims Settlement Bill. In my brief mihi, I just acknowledged the Minister, who spoke first in the House, and I’ve sat through the debate this afternoon, and also, too, the iwi to whom this settlement legislation applies. This is the second reading, as we have heard this afternoon. I want to mihi to the iwi and to the negotiators, because it is never easy to negotiate a settlement, and to get to this point where we are doing the second reading in the House, it has passed through yet another significant process, that being the select committee process.

I think that the issues that were raised in select have been well-traversed by all parties who have spoken in the House this afternoon. As I was only a member of the select committee for a short amount of time, I won’t focus so much on those issues through the select committee process, but just to, again, identify briefly, for those that are listening, what this bill does and what it includes in terms of the settlement. So the Ngāti Kahungunu settlement package will be finally and comprehensively settled—all remaining Ngāti Kahungunu historical Treaty of Waitangi claims. The settlement package includes the Crown apology redress, cultural redress, and financial and commercial redress to the value of $150 million plus interest. So this will settle all of Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua’s historical claims. And last week, we heard in the House the Te Rohe o Rongokako Joint Redress Bill, which will give effect to specific cultural redress which is shared between Ngāti Kahungunu and Rangitāne o Wairarapa and Rangitane o Tamaki nui-a-Rua, which is provided for in their prospective deeds of settlement.

Just briefly, I wanted to highlight, in terms of the cultural redress, that there are a number of instruments in the legislation to give effect to the cultural redress which has been negotiated. It includes protocols, vesting of properties, statutory acknowledgments, deeds of recognition, a Manawatū River catchment advisory board, and Te Upoko Taiao. I just wanted to note that in terms of official geographic place names, there will be over 30 geographic place name changes, which are listed in the deed. There’s also the vesting of 27 sites; four of which will be vested in fee simple, 22 in fee simple to be administered as reserves, and one vested in fee simple subject to a conservation covenant. Those cultural redresses, I know, are just as important, perhaps, if not more important for some claimant groups than the commercial redress. A lot of focus is put on the quantum, but I know for claimant groups that cultural redress is really significant as well.

I do want to acknowledge the select committee. I know that it was a challenging select committee process with the issues that were raised. I acknowledge the contributions that have been made across the House regarding that. I know that as a select committee we worked really hard to understand those issues and to seek more information and responses. And for the small part that I played in it, I commend the bill to the House.

TODD MULLER (National—Bay of Plenty): Thank you, Madam Speaker. It’s a great privilege just to conclude the National Party’s contribution on the second reading of Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua Claims Settlement Bill. As is often the way when we have iwi settlement bills in front of the House, the level of contribution—both in terms of substantive reflection on the cause for why we find ourselves here and some of the particular challenges that we have had to navigate, or at least the claimants have had to navigate—that we have heard as parliamentarians, has given us a substantive and eloquent voice, and that has occurred yet again this afternoon.

I do not intend to navigate the issues that have been traversed in any great detail. Indeed, I was going to reflect on the key settlement outcomes that are reflected in the deed, but the previous speaker has done that—again, very eloquently. But I thought, when reflecting on one of the core challenges that have been in front of the select committee with respect to the balance of progressing the Ngāti Kahungunu settlement with the other interests that are in front of the Supreme Court, that in the words that were reflected in the departmental report—that is, for those listening, the summary of all of the submissions, the perspectives that have been brought together by the officials for the parliamentarians that sit on that committee to finally reflect on—there are some perspectives that I thought could be relevant to this debate.

In particular, point 49 of the departmental report explored the balance struck between the Minister’s decision to introduce settlement legislation with that of policy relevance. It goes on to say that “the Crown’s comprehensive settlement policy for large natural groups” sits at the core of this decision. “All such settlements settle multiple Wai claims, often with some level of dissent within the group.”—and we have heard that traversed very specifically this afternoon—“However, Parliament has long supported the policy as the preferred way to settle multiple claims within the large natural groups where there is shared whakapapa and experience of prejudice from the same Crown Treaty breaches.” And, “the requirement in every settlement to balance the interests of multiple groups with relevant and often conflicting interests is very common—as is particularly the case in this instance.”

The other area that I thought was quite useful that the departmental report covered was that the basis of appeals to the Supreme Court does not bear upon the essential finding of the Waitangi Tribunal—that the assets are a “disproportionate” remedy for Wai 85 and Wai 429 claims, and that the Wairarapa Moana Incorporation structure makes it an inappropriate recipient of resumable assets—with shareholdings, rather than the whakapapa, determining the level of benefit.

The other point acknowledged in the departmental report that I thought was revealing was the statement that the removal of Wai 85 and Wai 429 claims could result in “significant ongoing liability [for the Crown] which undermines the policy of full and final comprehensive settlements.” Of course, it is noting, as the House has already heard, that Ngāti Kahungunu have voted twice to settle with the Crown based on the terms now agreed.

The report went on to say that, ultimately, the appeals before the Supreme Court, “will not end the matter” and that “the Wai 85 and Wai 429 claimants seeking an indefinite pause to reargue their case in the Tribunal … [would result in a] delay … with costs (not limited to financial) on all parties.” I think that gives a sense of the earnest reflection that has gone on, both through the Crown’s representatives—in this case, the Minister, but particularly the various MPs on the select committee, regardless of political philosophy—to try and get the balance right here in terms of our final recommendation back to the House.

As we have heard today, the Minister’s view—and the select committee’s view—is that the balance is in favour of ending further delay and bringing the benefits of comprehensive Treaty of Waitangi settlement redress to all of Ngāti Kahungunu. Certainly, the National Party reflects that that is the right landing point.

But as I said at the start, I think the various contributions from all sides—including our various National Party members—have talked to the complexity and challenges that sat behind that ultimate judgment of balance. Thank you, Madam Speaker.

RINO TIRIKATENE (Labour—Te Tai Tonga): Tēnā koe, Madam Speaker. He hōnore nui tēnei māku e tū ana ki te tautoko i tēnei pire hei tēnei pānuitanga tuarua.

[Greetings, Madam Speaker. It’s my honour to stand in support of this bill at its second reading.]

It’s a pleasure to speak in support of this bill at its second reading. Whilst I’m not a member—no longer a member—of the Māori Affairs Committee, I do acknowledge that the work that goes on with that committee, as has been evidenced by the contributions today in this House. Treaty settlements are difficult—there are a lot of competing issues, and it’s a very hard position that the select committee does find itself in at times, and it’s no different for every other settlement that has gone through this House. There are always competing Waitangi Tribunal claimants, hapū groups, disputed whakapapa, disputed areas, or disputed history. That’s the nature, I guess, of navigating through to a settlement.

So I would like to acknowledge the Minister, the Hon Andrew Little, and his officials for the work that they have conducted in, first of all, signing the deed of settlement and also in bringing this bill to the House to enact certain aspects of that deed of settlement. And the deed of settlement is the fundamental document which has been signed. I want to acknowledge Ngāti Kahungunu ki Wairarapa Tāmaki-nui-a-Rua, the negotiators, their leaders, their rangatira, their hapū, and their whānau, for the close to 20 years, maybe beyond 20 years, of pursuing this settlement and ensuring its enactment.

I just want to make a brief contribution. I know all of the difficult issues have been thoroughly canvassed, and I support the position that has been reflected in this bill and the decision—particularly the balance that the Minister had to make in his consideration of the various aspects that were raised at select committee. But I want to just speak to one point, and that is in relation to aspects of the settlement which actually aren’t included in the bill, but are part of the deed of settlement, and they relate to cultural redress. I’ve had the pleasure, as the Parliamentary Under-Secretary to Minister Parker for Oceans and Fisheries, to see firsthand the good work that is going on with the marae of Ngāti Kahungunu ki Wairarapa in particular—oh, ki Tāmaki nui-a-Rua, as well—through the Mai Paritu, tai atu ki Turakirae fisheries forum group, and that spans all of the East Coast, all of the takiwā of Kahungunu and Rangitāne and the Wairarapa especially, and I want to just acknowledge the work they’re doing.

We’ve heard a lot today about Ngāi Tūmapuhia-a-rangi, and I have seen that wonderful, beautiful hapū and their beautiful marae at Motuwairaka and the wonderful work that they are doing. This is what these settlements are about: it’s about ensuring the continuity, the continued expression of the permanency of tangata whenua of the hapū of Wairarapa. Those rights are being exercised daily; they are the custodians, they are the kaitiaki of that beautiful moana. If you ever go to Riversdale, you’ll see a beautiful Motuwairaka Marae and the wonderful work that they do—not least of which is the beautiful hākari that they serve at that lovely marae as well. Very commercially-minded as well: not only are they customary fishers, and they are doing wonderful work in that forum group, but they’re also commercial fishers of their fishery as well—especially the pāua fishery. So, for me, it’s wonderful to see, actually, hapū life in action when you go and see the beautiful people of the various hapū up and down the Wairarapa coast, visit their marae, see the wonderful work that they are doing. That is what these Treaty settlements are about; it’s about recapitalising our iwi groups.

I congratulate Ngāti Kahungunu and the two remaining taiwhenua that are included in this bill, and them having continuation of the wonderful work that they already do, which has been established mai rānō [long since]. And so with that, I commend this bill at its second reading. Kia ora mai tatou.

A party vote was called for on the question, That the Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua Claims Settlement Bill be now read a second time.

Ayes 109

New Zealand Labour 64; New Zealand National 33; ACT New Zealand 10; Te Paati Māori 2.

Abstentions 10

Green Party of Aotearoa New Zealand 10.

Motion agreed to.

Bill read a second time.

Bills

Natural and Built Environment Bill

First Reading

Hon DAVID PARKER (Minister for the Environment): I present a legislative statement for the Natural and Built Environment Bill.

ASSISTANT SPEAKER (Hon Jacqui Dean): That legislative statement is published under the authority of the House and can be found on the Parliament website.

Hon DAVID PARKER: Thank you, Madam Speaker. I move, That the Natural and Built Environment Bill be now read a first time. I nominate the Environment Committee to consider the bill.

Today, we are considering very important and substantial reform that affects all aspects of the environment we treasure and live in—legislation which affects everybody’s lives. The essences of life—clean air and water; housing; infrastructure such as roads, hospitals, and schools; renewable energy; farming; and commerce—are all impacted by these laws. Change is long overdue, but it has proved difficult to achieve. Successive Governments have not delivered; we are.

Since the Resource Management Act (RMA) was passed in 1991, there have been more than 20 major amendments and countless thousands of minor ones. They’ve made it ever more complex and difficult to navigate and overall have failed to fix the underlying problems. Everyone is frustrated: environmentalists, developers, councillors, farmers, and home builders. We need a faster, cheaper, and better resource management system. It is undisputed that the Resource Management Act is not working as was intended. It takes far too long, costs far too much, and it’s no exaggeration to say it’s broken.

Plans under the RMA have been too restrictive to enable sufficient house-building opportunities. The planning restrictions have strangled land markets, pushing up prices and restricting home-building opportunities. There is agreement across this House and across Government agencies that this has been a major contributor to land costs being amongst the least affordable in the OECD. In major cities, this has flowed through to inflated house costs for all housing, old and new; on the housing front, the RMA has had severe problems.

Sadly, environmental outcomes have also been poor. In practice, cumulative environmental effects have not been well managed. This is most obvious in the degrading of water quality and the loss of biodiversity and of valuable soils. Resource consenting has become ever more costly. Between 2014-15 and 2018-19, council consenting fees have increased by 66 percent for non-notified consents and 124 percent for notified consents. Infrastructure New Zealand Te Waihanga has estimated that infrastructure developers are collectively spending $1.29 billion annually on resource consent processes—5.5 percent of total project costs. This is outside the extreme end of approval costs internationally, with benchmarking showing that equivalent costs in the UK and the EU vary from 0.1 percent to 5 percent of project cost. Consenting is also taking longer, with a 50 percent increase in decision-making times between 2014-15 and 2018-19.

The RMA has not responded well to environmental challenges. Our environment is under significant pressure, with many of our native plants, animals, and ecosystems under threat. Many of our lakes, rivers, wetlands, and estuaries are degraded. The majority of monitored swimming sites do not meet World Health Organization safe swimming guidelines in summer. It’s all interconnected. The degradation of our natural environment reduces the ability of our ecosystems to recover from shocks like the increasing storm events that come from climate change. Sediment run-off is degrading our inshore fisheries. We’re losing that valuable topsoil. Sediment and nutrient loads extend beyond estuaries, adversely affecting kelp beds and scallops.

So it’s been a fail on the enabling of houses, a fail on the cost of consents for infrastructure, a fail on environmental protection, and civil society has concluded that RMA reform is overdue.

Over the past 18 months, Government has been advancing changes, as recommended by the expert panel chaired by the Hon Tony Randerson KC. They considered and we’ve considered reports from the Productivity Commission, the Waitangi Tribunal, Local Government New Zealand, the Employers and Manufacturers Association, the Environmental Defence Society, the Property Council, and Infrastructure New Zealand. The Government has engaged with local government, the private sector—including developers and infrastructure providers—environmental NGOs, and Māori groups, and now we’re legislating for changes that are grounded in the Randerson panel’s recommendation.

The Natural and Built Environment Act (NBA) sets out how the environment will be protected and used. It covers land use, along with environmental protection, order takes, and discharges and use of the coastal marine areas. NBA plans will describe the way in which a region’s resources will be managed, how environmental limits and targets will be set locally, how infrastructure development will be enabled, and how conflicts between outcomes will be resolved. More than 100 RMA plans reduce to 15 regional level plans across the country, prepared by regional planning committees who also approve them. Submissions are heard by an independent hearings panel. Time to take to prepare the equivalent of an RMA plan will reduce from 10 years to four. With fewer plans and faster processes, local communities will continue to have a strong voice, including through statements of community outcomes. There is flexibility for regions to determine the make-up of regional planning committees, which comprise representatives from local government and Māori groups. We’re not putting in place 50:50 co-governance.

Broader on Treaty issues, we’ve aligned the new law with the wording in the Conservation Act to give effect to the principles of the Treaty of Waitangi. Treaty settlements will be fully upheld and carried over.

The most significant change to enhance environmental protection is the shift from an effects-based approach to one that’s based on outcomes. The RMA approach of avoid, remedy, and mitigate has in the end allowed the accumulation of small negative effects, to the degradation of the likes of water and the likes of topsoil, as well as loss of biodiversity. The NBA changes this approach, setting limits to maintain current environmental levels and targets where degradation needs to be addressed. This shared environmental generation ethic is described as te Oranga o te Taiao, which is defined in the NBA and will support a responsible and positive relationship with the natural environment.

The National Planning Framework (NPF) will be central government’s primary lever to influence the new system. The first NPF is in development. It carries over existing national direction. It has new content on infrastructure and also dealing with natural hazards, including those caused by climate change.

Infrastructure is a major focus of the first NPF. Te Waihanga is leading the preparation of this direction, which will include policy outcomes, targets, standards, and rules to support a nationally consistent approach to infrastructure. Under NBA, consenting will be simplified and made more efficient. Greater use of standards, a reduced number of activities, and the expanded scope of permitted activities will reduce the number of unnecessary consents. This will reduce costs. Fast track, which was put in place in response to COVID and has been successful at reducing average consenting periods by 15 months, will be made permanent. We will not adopt fast track for all projects, as the National Party has suggested. They’re on the wrong track on that, because that would gum up the system and would turn fast track into slow track.

Designations are carried on as the main tool for infrastructure provision—I’m not going to have time to go into that detail. I’ll consider that in the Spatial Planning Bill.

Section 32 reports have become hopelessly long-winded, post-fact justifications and are hardly used. We’re putting an end to this waste. They’re going to have to be expressed succinctly and plainly, be proportionate to the scale of the proposal, and be prepared in a way that’s useful to a decision maker. We’re also legislating for an evaluation report to be limited if it’s giving effect to a provision in the National Planning Framework.

The cost-benefit analysis in the supplementary analysis report says that every dollar spent will deliver benefits of between $2.50 and $4.90. This comes from a reduction in consent volumes and a reduction in costs when consents are necessary. It will result in efficiency benefits from between $210 million and $430 million per year. Central and Government costs for infrastructure and development projects are likely to decrease. Consenting and designation costs go down, corridor protection protects investment certainty, and the opportunity to purchase land earlier in the development cycle also helps. Housing affordability benefits are predicted to be between $146 million and $834 million per annum. Public good benefits include a well-functioning resource management system for future generations and, of course, include the environmental outcomes that cannot be measured in dollar terms, but they’ll be improved. And those benefits are always very expensive.

The combination of the NPF, the regional spatial strategies, and the NPA plans will embed expanded supply of land and enable renewable electricity generation so we can affordably decarbonise the economy and address cumulative effects. The new system will be faster, cheaper, and better, and I commend the bill to the House.

Hon SCOTT SIMPSON (National—Coromandel): Well, thank you, Madam Speaker. I think “Hope springs eternal” is probably the best way to summarise the Minister’s introductory speech in the first reading of this quite momentous piece of legislation. But we’ve been a long time coming to this point.

So the Minister, in his address to the House this afternoon, has presented a long list of reasons why the existing resource management framework in New Zealand needs to change. And he correctly summarised that there was unanimity across the Parliament at the last election that the existing legislation that was first passed in 1991 had long since ceased to be effective for our beautiful natural environment in terms of protecting, maintaining, and enhancing that natural environment. And it was woefully inadequate in terms of providing for our built environment and the development of infrastructure, lifestyle, and the sorts of developments that we want as a First World nation.

But is what the Minister is proposing the correct answer? I think that on this side of the House, there’s probably one simple test that we will want to apply to this legislation as we give it vigorous attention and scrutiny through the select committee process. The test that we will want to apply to this suite of legislative changes that the Minister has brought to the House—remember, this is just the first part; the second part, the spatial planning part, will be receiving a first reading later this afternoon. But there is a third leg to the treble and that’s the adaptation piece, which won’t be seen until next year and may not be concluded in the life of this Parliament. But the question and the test that we will apply to this reform package is: will it make it easier to get things done? Will it make it easier to get things done? I am sceptical, upon first glance at this fairly significant piece of legislation, that the answer to that question will be in the affirmative. I’m not sure that it will be. And for anyone that is doubtful about the complexity of the issues that are confronting this Parliament when we attempt to reform the existing status quo, just have a look at this first piece of legislation and look at the size of it. The existing Resource Management Act (RMA) runs to some 900 pages. It started out in 1991 at about 300. And then, as the Minister has said, it’s gone through a lot of amendment and change since then and has ended up at about 900 pages. This first leg of the trifecta that the Minister is introducing to the House runs to nearly the same length, some 807 pages, and then we’ll add in the Spatial Planning Bill and then we’ll add in the adaptation piece—and I would put money on it that the total will be longer and more complicated than the existing status quo.

So what does this piece of legislation seek to do? Well, it seeks—I think, and I’m going to give the Minister some credit, in a well-intentioned way, to try and improve things. And so from that point of view, that’s a good thing: to try and improve things. But if the remedy is worse than the ailment, then that isn’t moving our nation forward. We are a country of 5 million people spread across a not insignificant landmass—about the size of the United Kingdom or Japan—and we have some of the most complicated, most expensive, most complex planning and resource legislation on the planet. Some of it stems back to the actual formation and creation of the existing RMA. A quite radical piece of policy at the time which set about trying to resolve the eternal conflicts of how to protect, maintain, and enhance the natural environment while at the same time allowing development. It set those two conflicting positions, if you like, into one piece of legislation. At the time, people thought, “Well, this is world leading. This is going to be the way the world will go.” And we all sort of patted ourselves on the back in New Zealand, we thought this was world-leading stuff. It turned out that, in fact, the world didn’t follow us and they didn’t go down the path we went down—and they did not do it for some very good reasons.

So there are some issues that we want to present to the select committee and to this House as this piece of legislation works its way through the system. In essence, we’ve got a number of main concerns. The first one I’ve outlined is the answer to the question: will it make it easier to get things done? We’re not sure that it will. But we are concerned that this piece of legislation and the other two pieces that go with it will actually just add more bureaucracy to an already heavily burdened bureaucratic system. The plan is to establish 15 regional planning committees with some very dubious democratic accountability levels applied to them. We don’t know quite how they are going to be appointed, what the decision process will involve. But we do know that those regional planning committees will be effectively another layer of local government, and that’s a cause for immediate concern. But it’ll be another level of local government that has enormous power, enormous power to influence the outcomes of people’s lives and how they live their lives. And so we are concerned about the whole concept of the regional planning committees, how they’re going to work, how they’re going to operate, how they’re going to be appointed, who makes the decisions, where is the democratic accountability, and where they will actually assert and exert their power and influence.

Another area of concern for us in the National Party is the high degree of legal uncertainty that the new reform package will bring to anyone who wants to get anything done. And so there is a lot of new language, a lot of new vocabulary, a lot of new terms in the proposed legislation. There’s a new concept in terms of replacing what the RMA used to refer to as “sustainable management” with the new concept of “Te Oranga o te Taiao”. Now, that’s an untested term and phrase, and pity the poor developer or person who wants to get something done that is going to have to end up taking a case all the way, probably, to the Supreme Court to get some kind of judicial interpretation in understanding of exactly what the term means. That’s going to be expensive and time consuming. And it will need to be tested because iwi will want to test it in exactly the same way as any other sector of our society want to test it, to find out exactly what it means and how it will be applied.

Then I think the next area of concern that we have on this side is as to whether the balance of these reforms are pro - development and progress or whether they will hinder development and progress. On our reading of it, it looks very much so that things will be harder to get done, that the development of much needed infrastructure is going to be very, very difficult. And so there’s nothing in this bill that gives us confidence that it’s going to be easier to get things done.

Now, there have been a number of responses to the legislation—[Interruption.]

ASSISTANT SPEAKER (Hon Jacqui Dean): Order! Order! Hon Scott Simpson.

Hon SCOTT SIMPSON: Thank you, Madam Speaker. There have been a number of responses to the proposed legislation and I just want to just go through a few of them because I’m sure that many of these folk will want to be presenting submissions to the select committee. But there’s one that stuck out for me that I thought was very appropriate. It comes from a former Labour Cabinet Minister, one David Benson-Pope, and he is now and has been for some time a long-serving councillor on the Dunedin City Council, and he says that the suggested savings were “a bit overblown”, to be his analysis of that. And then he said further he’s wary of a one-size-fits-all mentality. And then he goes on and says “A lot of wheels are being reinvented now, many of them unnecessarily.” And so good old David Benson-Pope, a man who spent quite a bit of time in this Parliament and has had a very long career in local government, so he’s dubious and concerned about it. And then you’ve got Alan McDonald from the Employers and Manufacturers Association, he says “Success or failure will depend on how these reforms are made a reality.” And isn’t that going to be the test: how are these reforms going to be made a reality? Leonie Freeman from the Property Council, she’s got concerns. Federated Farmers have concerns. There are a whole range of legal practitioners and citizens and developers who have concerns, and even the environmental organisations have concerns—as do we. We will not support this bill at first reading.

Hon PHIL TWYFORD (Associate Minister for the Environment): Thank you, Madam Speaker. I want to acknowledge the work of the Hon David Parker in shepherding through what is not only a massive piece of legislative reform but it’s an issue that is hugely important to New Zealand. As well as being cheaper, faster, and better resource management law, I’m confident that the new planning system that this bill begins to usher in will not only protect the environment better than the old system but it will allow our towns and cities to grow, it will allow the homes to be built that we desperately need, and it will encourage more liveable and successful cities.

I want to devote my call to some comments about how the whole issue of urban tree protection will be dealt with under the new planning system. I think everybody understands that trees are extremely important to the life of our cities. There are many reasons, as the Lorax said, that we must speak for the trees. They bring beauty to our lives, they attract birds, they give shade, they are good for our mental health. The urban forest futureproofs our cities for climate change. They cool cities that are becoming hotter and hotter because of the increase in hard surfaces associated with intensification. Climate change is making our cities wetter and more flood-prone, and trees absorb and filter stormwater. They improve air quality, they provide a very important acoustic buffer in our neighbourhoods, and, most importantly, kids can climb on them.

Now, the problem that we need to address is that the big change that’s under way in our cities—the intensification that must happen in order to allow more homes to be built and allow space to be used more efficiently in our cities—is putting great pressure on the urban forest. We must build more homes and we must allow our cities to grow up, but all of these things are putting pressure on the garden suburbs of our 1950s-style cities. There is clear evidence, particularly in Auckland, that the development pressures unleashed by the reforms of the Auckland Unitary Plan have led to a massive surge in new homes being build—particularly medium-density housing—and that is speeding up the loss of trees on private property.

We need to strike a better balance. Through the changes that we are beginning to debate today, we are going to make it easier for councils in their new plans to protect the special trees that people love in their neighbourhoods. Under the National Planning Framework to be released next year, we will allow councils to create a rule in their plans that would protect trees of a certain size or age. They’re often referred to as specimen trees. Now, that would mean that if a property owner wants to remove such a tree, they would need to get a consent, and this gives communities, through their council, the opportunity to weigh up the value of a specimen tree against the value, for instance, of developing that patch of ground, or for the council and the landowner together to find a win-win solution.

Now, this is not possible under the current rules in the Resource Management Act (RMA), put in place by the National Party in 2009, which require councils to schedule individual trees or groups of trees on specific named and sited properties if they want to protect them. These restrictions from 2009 certainly give certainty to landowners and developers, but they make it virtually impossible for councils to protect the very special trees that people value. Under our proposals, councils will still be able to continue protecting trees by scheduling them as they can under the RMA, but we won’t be going back to the pre-2009 system where, in some places, property owners routinely needed to get a consent to remove trees.

But preserving our urban forests requires much more than just regulating what happens on private property. The National Planning Framework will also direct urban councils to develop an urban forest strategy as part of their plans. It will be evidence-based and it will contain percentage targets for canopy cover. Auckland is currently at an average of only 18 percent canopy cover. The international benchmark is 30 to 40 percent. Brisbane has canopy cover of 44 percent, Melbourne has a target of 40 percent by 2040, and it’s worth noting that in our major urban centres today, some suburbs are leafier than others. Auckland’s working-class suburbs have substantially lower canopy cover. Māngere-Ōtāhuhu has 8 percent cover. My own electorate of Te Atatū, in the Henderson-Massey Local Board area, which has some of the fastest urban intensification going on in Auckland today, has just 15 percent canopy cover, and it is reducing on a weekly basis because of all of the intensification. The strategies will need to cover not just trees on private property but trees in the road corridor and in parks and in public places, and, ideally, these urban forest strategies will use a range of methods and incentives to increase public acceptance of urban trees and build a sense of collective responsibility for the urban forest.

The Government recognises that the future planning system will make it easier for councils to protect the urban forest, but it is going to take considerable time for those changes to bed in, and, in fact, it could take up to a decade before the Natural and Built Environment Act (NBA) plans that will be created under this legislation that we’re debating today are operational at a local council level. So we will amend the current RMA, and possibly the existing national direction, as a transition measure to ensure that the outcomes that we are talking about today can be put in place much earlier than they would be if we were going to wait until the new system ushers in a new generation of NBA plans.

So what this means is that over the short term, councils will still be able to protect trees using schedules in the RMA plans, but they will be able to introduce a narrow tree protection rule where a resource consent is required to remove a specimen tree of significant size or maturity. In addition to that, councils will still be able to use things like financial contributions, where they will have the ability to rebate financial contributions levied on a landowner or a developer in order to incentivise the retention or the planting of trees.

The same principle applies to development bonuses when a landowner or developer wishes to do anything that is not strictly enabled under the detailed provisions of that local plan. They can then negotiate with the council and, in doing so, the council will have the opportunity to incentivise the retention of trees. Finally, the Medium Density Residential Standards, which are subject to current intensification plan changes, are designed specifically to allow outdoor space to be grouped as communal space in developments, thereby allowing more space for trees amongst the medium-density developments.

So there it is. That is the approach that we are taking in the course of stewarding this new planning system for New Zealand on one important aspect of the urban environment, and that is how we protect and enhance the urban forest.

CHRIS BISHOP (National): Well, I was quite looking forward to that speech from Phil Twyford. I thought we were going get a discourse on competitive urban land markets and flooding the market with development opportunities and taking advantage of cheaper land which would drive cheaper housing.

Hon David Parker: We’ve already won that argument.

CHRIS BISHOP: Ha, ha! Well, you might have already won that argument, there’s consensus across the Parliament around that. It’s just a shame that this bill doesn’t actually deliver that.

Hon David Parker: It does.

CHRIS BISHOP: It does not. But I thought we were going to get a diatribe around that, but we didn’t. Instead, we had seven minutes on the somewhat niche topic of trees—niche but important, lest I be accused of environmental vandal. But, no doubt, the Minister will make further contributions as the bill goes through the House, because I know that he is all in favour of competitive urban land markets driving better housing outcomes.

This is a bill that has been a long time coming to the Parliament. I want to be very serious around this, because there is consensus across the Parliament that the Resource Management Act (RMA) is broken; there’s no doubt about that. It has delivered neither better environmental outcomes or better quality infrastructure or faster infrastructure, and it has also—and this is the worst bit of it, in my view—helped deliver the most unaffordable housing market in the Western World.

Now, I’ve been at the Infrastructure New Zealand conference this morning, as the Minister has, and I heard someone stand up and say, “Oh, the RMA is only part of the problem.” Well, the RMA is a big part of the problem. I don’t think many people who have studied the issue comprehensively would deny that.

For 30 years, we have tied ourselves up in these labyrinthine planning processes that have managed to produce a social and economic disaster of extremely expensive house prices, extremely expensive rents relative to income, and now, of course, around 4,000 families living in motels around the country—at enormous fiscal cost to Government; billions upon billions every year. There is consensus that we need to fix the RMA.

The question is whether or not this package of bills from the Government does that. I do just have to make a slightly political point: the last National Government spent nine years arguing for comprehensive RMA reform—and David Parker is smiling; I know he’s going to say, “So why didn’t you do it?” The reason we couldn’t do it was because we could never get the numbers in the Parliament. The Hon Peter Dunne, who sat down on the crossbenches there, sat there for three years and would not accept the arguments around housing affordability and around infrastructure provision and around all of the arguments that David Parker is making now. He would not accept those points, and he just sat there and point-blank refused to accept the need for RMA reform.

Hon Dr David Clark: Nine long years.

CHRIS BISHOP: It was nine great years, actually, David Clark, and it’s going to be another great nine or 12 years in a year-or-so’s time.

So we could never get the numbers, and Labour opposed all of the sensible changes we put forward to the RMA during that time in Government—and they cried crocodile tears—and now they turn around say, “Oh, don’t worry, we’ve got it all sorted.” So we’ve waited five years, and here we go.

Look, I don’t want to be churlish about this, but as I say, I do just want to make the point politically which is that it is somewhat galling to hear David Parker turn up in this Parliament, and Phil Twyford, and, no doubt, Rachel Brooking—she can’t blamed for it, actually, she wasn’t part of it, so I can’t blame her. Anna Lorck is not responsible either—it’s David Parker and the Ministers who have been around for a while; it’s their fault. They turn around and say, “We need RMA reform.” Now that they’ve got an absolute majority, they’re going to ram it through.

Genuinely, genuinely serious point: we’re going to partake in the select committee process properly, there’s no doubt about that. Scott Simpson and myself and the other National members and Eugenie Sage, who is a very good chair of the Environment Committee, I know will do a good job examining the bill, but we are sceptical.

I want to lay out why we’re sceptical. The first is that we worry about the bureaucracy. Now, the planning system is already riddled with bureaucracy. Under this new system, there’s going to be these regional planning committees. There will be 15 of them mapping the existing regional council boundaries, clumping Nelson and Tasman together—time will tell how Nelson and Tasman will feel about that.

“Committee members shall be appointed by the local councils.” Now, our worry is that argument over who is going to be on each of the committees will take years. Now, I’ve been around long enough to see a few local government bum fights in my time, and they can get unpleasant quickly. I do worry that just the actual debate about sorting who is on the committees and mana whenua and which particular iwi is on the committee etc. is going to add to more bureaucracy.

We worry about the democratic deficit. Territorial regional councils are made up of elected members, they decided the shape of their cities. These are going to be appointed members; voters can’t throw them out—at least not easily. Of course, there is even more plans that these new committees will have to give effect to. So we worry about the bureaucracy.

The second thing is, and this is a very important point, is legal uncertainty. The purpose of the new Natural and Built Environment Bill will be to “recognise and uphold upholds te Oranga o te Taiao”. Basically, sustainable management as a purpose in the old RMA has been explicitly replaced by te Oranga o te Taiao. Now, I’ve checked the statute books. This is a legal term that is completely new to New Zealand law.

Hon David Parker: It’s defined.

CHRIS BISHOP: Sure—sure! But it’s never been used before, there’s no case law on the issue, it is completely new to New Zealand law, and apparently it’s been written for this bill, and it’s in the purpose statement of the bill. So that is going to suffuse its way through the new RMA system—or the new Natural and Built Environment system.

Angie Warren-Clark: Yup.

CHRIS BISHOP: “Yup”—OK, so she’s proud of it. OK, that’s all good. Good to have that clarity. The regional committees, the councils, the planners, the builders, everyone is going to have to figure out what this means and apply it. Good luck.

One option is that everyone just decides that “te Oranga o te Taiao” just means “sustainable management”, which is the term it’s replacing. But if Parliament meant that, we’d just say that. Parliament is not saying that, or at least the Government proposal does not say that. So when Parliament changes the words, the courts assume we’re doing it deliberately. Now, I’ve already had RMA practitioners approach me and tell me that there is going to be years of legal wrangling over this language. That means more delays, more costs, more roadblocks for new housing and infrastructure.

Add on top of that the requirement to take account of the principle of the Treaty of Waitangi to “give effect” to the Treaty of Waitangi. Now, it sounds like a small change, but it’s not. As any RMA lawyer will tell you, there’s a big difference between taking account of something and giving effect to it. Now, the Supreme Court has recently ruled that “give effect to” means implement, and it is a strong directive; that’s their language. It significantly strengthens the provision. Our view and our concern is that it will make it more difficult to do things—not easier—and it will let to more legal uncertainty. We want to get to grips with that issue in the select committee; I think it’s going to be very important.

Now, the Government’s argument is that the Conservation Act 1987 contains that language; that’s true, it does. But the Conservation Act is specifically about conserving and protecting resources. It doesn’t have to solve the problem of choosing between nature and development. The planning framework for our cities and our environment does have to solve that problem. So the strategy of just transplanting language from a totally different context, in our view, is misguided.

Thirdly, we’re concerned about the balance in the bill. We’re concerned it’s too tilted against development and in favour of the environment. Now, the Government says this will make it easier to do things. Everyone is in favour of that. But look at clause 3 of the new bill: “(a) enable the use, development, and protection of the environment in a way that—… (iii) promotes outcomes for the benefit of the environment”. Now the emphasis from the current law is very different. This new law is about promoting the environment, and only if you can promote the environment and comply with environmental limits and te Oranga o te Taiao will you be able to do things. This is not a recipe for faster and smoother; it is a recipe for argument.

Look at all the things that plans have to do: protect or restore ecological integrity, mana, and mauri of air, water, soil, the coast, wetlands, estuaries, lakes, river, biodiversity, reduce greenhouse gases, recognise the relationship of iwi and hapū, conservation of cultural heritage, protection of customary rights, public access to the coast, protecting highly productive land, plus—plus—the use and development of land for housing, business, and the ongoing and timely provision of infrastructure services. How can plans achieve all of those things? This is a recipe for gridlock, like we have at the moment.

The second point I take from that is it’s very clear where the balance lies. Look at those things that plans have to provide for. The natural built environment and infrastructure barely get a look in—they barely get a look in. These bills—and this bill in particular—look like environmental protection Acts. They are not pro-development bills. Our concern is that they will not lead to making it easier for New Zealanders to get things done. We oppose them, but we’ll consider them at the committee.

RACHEL BROOKING (Labour): Thank you, Mr Speaker. I have to say that I am very excited to be speaking on this first reading—this will be of no surprise to anyone here—of the Natural and Built Environment Bill, noting that there is no “s” on that “Environment”; excuse me if I accidentally add one in. We’ve heard already that this bill has been a long time in its development. We’ve had people, practitioners talking about how the Resource Management Act (RMA) is a problem for a long time, people in this House talking about how it’s a problem, and then Minister Parker established the Randerson review, chaired by Tony Randerson.

Chris Bishop: Who was on that?

RACHEL BROOKING: Who was on that? I had the great privilege of being on that before I was an MP, and it was a very interesting process to be involved with. Of course, that group considered many of the issues that have made it into this bill, and the one we’ll be discussing later. And then, of course, it’s been some time in the development of these bills since those reports, so my point there is that this has all been very well thought through. It’s important. It’s complicated. Planning is always complicated, because people want to do different things with their land and there will always be conflicts.

So some of the things that I wanted to talk about quickly: one thing is that some commentators have said that this this piece of legislation is no different from the RMA; that it just all looks the same but it’s a slightly different shape. But I think when you look more closely, you see that it’s actually very different, because the focus here is on outcomes, not just effects. We’ve had the previous speaker, Chris Bishop, talk about some of those outcomes in clause 5. There are those differences with giving effect to the Treaty, and I agree with the last speaker that it is a big change. There are also smaller changes that are harder to see, and that is in things like the definition of “environment”. There’s no longer any reference to amenity, and that’s a very fundamental and important difference.

However, the drafters of the bill have been careful not just to get rid of concepts that are well understood and change the names for changing the names’ sakes. So we still have consents—admittedly, we don’t have non-complying or restricted discretionary. We still have designations, we still have plans, and we now have a national planning framework.

So I think it’s important if we just spend a little second on those outcomes. Some of the outcomes are to address climate change, and this is the reduction of greenhouse gas emissions, the removal of greenhouse gases from the atmosphere, and the reduction of risks arising from, and better resilience of the environment to natural hazards and the effects of climate change. That is very important.

As to the previous speaker, Chris Bishop, saying that there’s not much about development, one of the outcomes in clause 5(i) is the ongoing and timely provision of infrastructure services to support the wellbeing of people and communities, and, of course, at clause 5(c) where we’re talking about land being available for housing, and, in fact, there is the ample supply of land for development to avoid inflated urban land prices. So all those things are quite different.

There are also, of course, limits—specific limits that are going to be set by the national planning framework. There are also targets. And, in clause 6, just staying in the purpose part of the bill, we’ve also got to recognise the positive effects of using and developing the environment to achieve the outcomes. That’s a big change as well.

We’ve heard about the one plan per region. It’s important to note that it’s not the regional council in charge of those plans; it’s all the different councils within one region making a plan together. We also hear that it’s going to take 10 years to implement, and that’s because there are 15 regions, the way that we’re going to use it in this bill, because we’re putting Tasman and Nelson together; they’re both unitary authorities. It’s going to take 10 years because we’re not going to do everyone all at once; there’s a region-by-region approach. In the Randerson review, being part of that group and talking to practitioners, it was very difficult for the practitioners in New Zealand to do both the Auckland unitary plan and the Christchurch plan at the same time. So there has to be some thought about that transition that this bill reflects.

We need to do this. It’s easy to say, “Well, National wanted to do it last time, but they didn’t do it.” Here it is. It’s had a lot of work that’s gone into it. The select committee is going to spend the proper amount of time examining this. Everybody wants it, every speech that I’ve heard so far tonight. Everybody wants it to work and wants it to be efficient, to do both looking after our environment and providing for the needs of our communities. Thank you, Mr Speaker.

Hon EUGENIE SAGE (Green): Tēnā koe, Mr Speaker. I’m pleased to take a call on the Natural and Built Environment Bill. The bill has certainly been a very long time coming, and I congratulate Minister Parker and the legion of officials in the Ministry for the Environment and other agencies on all of the mahi that they have put into it, drawing on a plethora of reports, the very substantive review by the Randerson team, the Hon Tony Randerson, and that report published in 2020—because it does deal with that problem that we’ve got: urban areas which have been struggling to keep pace with population growth. There’s been a lack of coordination between infrastructure investment and development. We’ve got increasing car congestion, reduced housing affordability and a lack of protection for the environment.

But sometimes I think it is too easy to blame the law and to blame the Resource Management Act (RMA), because it’s partly a mind-set. It’s a very frontier, colonial mind-set of taking, taking, taking from nature and not recognising the dependence that we have on infrastructure—green infrastructure that nature provides in terms of soil, sunlight, air, fresh water, and our oceans. So I’m really pleased that te Oranga o te Taiao is a key concept embedded for the first time in the bill, because with Te Ao Māori perspectives it recognises that humans depend on nature and that we are connected. We need a resource management system that delivers better, and there’s a very big ambition in this bill in moving away from the focus on managing adverse effects to focusing on outcomes, environmental outcomes, and human activities occurring in a way that promotes those environmental outcomes: development happens within limits and it meets targets.

There are quite major changes to the whole planning process with regional planning committees, the two members representing iwi, and other representatives from councils being involved in those. It sounds easy to take more than a hundred plans and make them 15. That is a huge exercise and the devil will certainly be in the detail, in this bill, both in the detail and in the way in which the bill is implemented over the next decade. It will be Labour and Minister Parker’s legacy.

Some of the concerns that the Greens have: a bill of over 800 pages would get the normal six-month select committee process, but for such a large bill, that is actually a limited amount of time. I apologise in advance to submitters who will be having to come to grips with this complicated legislation over the Christmas break and make submissions, and I do wish to point out to the Minister that there could be a significant improvement in the information that the Ministry for the Environment (MFE) has on its website.

We’ve had the release of the supplementary analysis report. That refers to a lot of ministerial oversight group Cabinet papers. They are not available on the MFE website. There’s a lot of aesthetic, white space on that website, but real gaps in information, unlike three waters, for which at least the Department of Internal Affairs had a comprehensive list of all of its reports and they were very easy to access. It’s important for the public to be able to understand the consideration of options that went in to developing the bill and why certain provisions were arrived at.

In terms of the Green Party’s position, it’s certainly to support it at first reading so that it goes to select committee for that public scrutiny, but our support beyond that does depend on achieving some significant changes. I was pleased to hear Minister Twyford talk about urban trees, because it was really disappointing to see in the bill that it just perpetuates the status quo. It requires councils to schedule individual trees and small groups of trees to identify them before they can achieve any protection. It makes no improvement on the status quo, but what I heard was there’s the potential for changes through that select committee process. So that’s one of the things we are concerned about.

It’s interesting that National is saying that the bill potentially constrains development. From the Greens’ perspective, we see it as potentially expediting development. There are a number of exceptions to meeting the outcomes and some of the targets. There is the ability for the Minister to create exceptions through the National Planning Framework, the wider ability for designations, and more agencies being able to be requiring authorities, and I think back to the huge community concern when Central Plains Water was given requiring authority status and was able to have a big designation over farmland with farmers unable to undertake some of their activities because that would have conflicted with the proposed reservoir.

But there are things in it too like the notification notice that consent authorities won’t be required to hold a hearing, even if a consent is notified. I’m still grappling with the detail of that. Does that mean that there’s less opportunity for the public to get engaged? I would note the experience of people in Christchurch with the Christchurch district plan post-earthquake, where with the Canterbury Earthquake Recovery Authority, in particular, there weren’t hearings. People felt alienated when decisions were made behind closed doors without an opportunity to talk directly to those decision makers.

Around aquaculture, coastal sea space is a public asset. It is the commons. There is, in the rhetoric around the bill, a lot of talk about promoting aquaculture, promoting investor confidence, providing new opportunities, accelerating aquaculture, but at the same time we have a handbrake on marine protection. So there may be some tensions to work through there.

One of the things I do like is the compliance and enforcement provisions. There’s a huge gap in the current compliance system under the Resource Management Act; the Environmental Defence Society and Marie Brown highlighted that in their report Last Line of Defence. You’ve got a lack of staff resources, a lack of funding, and a lack of serious intent to actually enforce plan rules, so there’s no advantage then for industries and for landholders to do the right thing if those that are doing the wrong thing always get away with it. So there are provisions in the bill where councils have to have an up-to-date compliance, monitoring, and enforcement strategy. They can cost-recover from monitoring permitted activities. Consent authorities can consider an applicant’s compliance history when assessing a consent application. There is the increase in financial penalties, and the fact that companies can’t use insurance to pay fines. Those are all significant improvements to the compliance and enforcement system, and that is likely to provide better for nature.

I think we’ll have interesting discussions in the select committee and from submitters about the allocation tools that are in the legislation. We’ve got a number of issues, particularly in regions like Canterbury and Otago, where catchments are over-allocated and where councils have agreed for too much water to be taken for irrigation, agricultural use, with too long a terms on those consents and not adequately providing for the river and the aquifer needs or for the future needs of communities. So there is the recognition in the bill that the current system of “first in, first served” doesn’t always work.

Providing—taken from the Randerson review—principles of equity, sustainability, and—there’s another one—

Hon David Parker: Efficiency.

Hon EUGENIE SAGE: —efficiency to drive new allocation mechanisms is something I think we’ll really look forward to getting submissions on. An ability to have more short-term consents, as the Natural and Built Environment Bill transitions over from the RMA, and to have some market mechanisms like auctions and tenders, but not for fresh water takes—some of those conversations through submissions I really look forward to, to see whether we can improve the bill there.

Also one of the other areas, other than te Oranga o te Taiao, is the mechanisms to better ensure that the principles of the Treaty are given effect to and upheld. The decision to establish a new national Māori entity to monitor Te Tiriti performance of the whole system, to provide input into the development of the National Planning Framework, to provide advice, and to nominate members for the boards of inquiry will certainly give Māori more influence in the way in which we do resource management as well as those positions around the table on the regional planning committees.

It is a big bill. There is an awful lot of detail in it. I hope that the select committee process is constructive and we really do need all of the parties in the House to work to improve the bill so that it endures.

Just having an oppositional stance—I was pleased that Chris Bishop said he was going to be constructive. This bill is too important to fail. It needs to endure, so we all need to work on ensuring that it is as good as possible when it is reported back. Kia ora.

SIMON COURT (ACT): Thank you, Mr Speaker. New Zealand’s resource management laws have become unmanageable, with rules piled upon rules, all of which hold back progress and many of which have actually led to unforeseen environmental consequences. The root cause of this is the current Resource Management Act’s lack of philosophical coherence. It can’t decide whether privately owned land and the right to decide what to do with it belongs to the property owner or to the council, local government, iwi, central government, or the Environment Court. The same confusion also exists for shared resources like lakes and rivers. As a result, it’s difficult to make decisions about how to use or develop resources, and that leaves us all poorer.

Minister Parker claimed in his introduction to this 807-page bill that the reform will deliver resource consents and permits faster, better, cheaper, yet the bill appears to be simply RMA 2.0, Minister. It’s a reform designed by a committee, a committee led by one of the same planning lawyers who came up with the first Resource Management Act (RMA).

Now, sitting under section 5 of this bill, there are no less than nine environmental outcomes—including some that are extremely vague, such as the “ecological integrity, mana, and mauri of air, water, and soils”—and each one of these nine outcomes has many sub-outcomes as well, 18 in all. How 18 outcomes and sub-outcomes are meant to be balanced by decision makers is unknown, untested. There’s no hierarchy amongst these outcomes, and the criteria for decision making in section 6 affords discretion for decision makers in how they are pursued and, once limits are met, is also incredibly vague.

Now, the intentions of Minister Parker are well signalled: faster consenting times, more certainty for industry and for infrastructure agencies, yet the Minister has been forced to concede already that the reforms won’t actually deliver this. He has proudly announced that the fast-track consenting provisions under the existing Resource Management Act will be carried over and embedded into this new, 807-page bill. That’s right—the fast-track provisions, which limit who can object to developments and require a quick response from the Environmental Protection Agency, have to be retained. That’s an admission the reform process has failed right there, Minister.

Now, the Labour Government’s preference for centralisation is well understood, and it’s continued here in this bill, with a national planning framework no less, Minister. The National Planning Framework will have to be created by an Order in Council, so it won’t be here in this bill, and it relies on an executive decision by the Minister for the Environment—who currently is Minister Parker—establishing a central planning system directly from the Minister’s office. It’ll say what you can and can’t do around the country, and what consents you’re even allowed to apply for.

Now, this raises constitutional issues, as these powers are so wide and far-reaching that it’s not normally delegated to Ministers and officials for such wide-ranging and extensive powers. Allocation of resources will be by a bureaucratic juggling of three principles: of sustainability, of equity, and efficiency. However, clause 88 of the bill does, in fact, allow for a market-based mechanism for the use of geothermal water, and “the capacity of freshwater to assimilate a discharge of a contaminant”, but then clauses 88 and 128 blow the market opportunity by explicitly prohibiting a market-based solution for the allocation of fresh water, Minister, which is a surprising contradiction and a real failure.

Hon David Parker: Except if Parliament agrees.

SIMON COURT: Now, consenting remains at the heart of this system. Now, the Minister said, “Except if Parliament agrees,” so maybe he is open to more market-based opportunities to resolve conflicts in the environment. So let’s see. Let’s see. Hopefully submitters who come to select committee will take up that opportunity, Minister.

Now, consenting does still remain at the heart of the system. At its core is the idea that people who want to do stuff require consent. The role of the bill is to set out those areas which are permitted, and even permitted activities can have requirements such as certification by a qualified person—you know they need an assessment by an iwi, particularly areas that are identified as having value to Māori. But what we heard from submitters on the exposure draft of this bill in 2021 is what they want reform to do is to make it clear who has rights to do what, property rights—whether they’re landowners, whether they own existing assets like ports; transmission lines; and power stations, the things that deliver energy, for example, to our cities and industries.

Farmers, growers, and irrigators also want to know that they can build water storage and transmission so that their farming and production activities are more resilient to climate change, droughts, and actually to be able to put more water back into the rivers. Because farmers love the environment; they depend on it to grow stuff. People want to know they should be able to use their own land for the most efficient purpose. To maintain, renew vital infrastructure without having to spend years and millions—or tens of millions—getting consents for things that are actually vital to support healthy communities and a thriving and healthy economy.

Now, instead of replacing the RMA with a property rights - based system that allows Kiwis to develop more and get things done, Labour’s used their replacement as a Trojan horse for another round of co-governance, Minister. That’s right, the driving principle of this bill is te Oranga o te Taiao, which means plans must incorporate “the health of the natural environment”, “the intrinsic relationship between iwi and hapu and te Taiao.”

Minister, I feel I also have an “intrinsic relationship” with the environment, but it’s not mentioned here. The “interconnectedness”, it says, “of all parts of the natural environment”, “the essential relationships between the health of the environment and its capacity to sustain life;” but how land and fresh water will be managed by relationships and interconnectedness in practice is anyone’s guess, Minister. But we’ve heard from Rachel Brooking, who was also involved in the design of this bill, that it’s going to take 10 years to implement. So I guess that’s why we need the fast-track component.

But look, this is simply a recipe for endless judicial hearings as people try to figure out what it means. This is placing undefined relationships and concepts like “interconnectedness” at the heart of land and water management; means that just about anyone will be able to object to anything, and that’s the fundamental problem we currently have—

Anna Lorck: You object to everything.

SIMON COURT: —with the Resource Management Act, Anna Lorck. That’s what we have. In Tukituki, people objecting to the use of water. It’s going to put your farmers, your growers, and your primary producers out of business, Anna Lorck. Labour hasn’t learnt from the public’s rejection of three waters and co-governance. Who your grandparents are should not make any difference to the decision making you have over how other people’s land is used to what water rights you have.

Now, all persons exercising powers under this bill must also give effect to undefined principles of the Treaty of Waitangi. A National Māori Entity will provide proactive monitoring of Te Tiriti performance. Now look, while regional planning committees are intended to have, at a minimum, two iwi representatives, the Waitangi Tribunal has indicated it would insist on 50:50. So it remains to be seen how this works in practice, but we’ve seen how Labour gives effect to their constituency, and I reckon 50:50 co-governance is how it’s going to end up, Minister.

Now, there’s no explanation as to how this will make it easier to build houses, build transmission lines, transition to a renewable economy, become more climate-resilient against drought, or simply fix roads. There’s no idea how this is going to work in practice.

Labour’s addressed none of the problems the original RMA has caused. Co-governance, co-Government—whatever you call it—has no place in our planning laws. The Government should instead take a property rights approach. The only rights people should have to object to something you want to do is if it actually affects them in their property—imagine that.

Instead of giving a whole lot of people the rights to object to stuff, ACT says that you should have the right to do what you want with your own property. ACT will be announcing our own alternative to the Resource Management Act next Tuesday. We will have an alternative that the people of New Zealand, and submitters, will be able to evaluate against this Minister’s poorly designed bill.

If we want to make it cheaper to get goods to market, to build homes, and actually deliver a better New Zealand for the next generation, we need to reduce Government interference in our lives and go back to a principle that Kiwis should be able to maintain and enhance their property rights. That’s the only way we’ll realise our economic potential—

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

TĀMATI COFFEY (Labour): Thank you, Mr Speaker. Gosh! What a contribution from that previous member, Simon Court. The irony sits in the fact that we’ve just—

Simon Court: Point of order, Mr Speaker! Given that the member enjoyed my contribution so much, I seek leave from the House to have another five minutes.

SPEAKER: I don’t reckon.

TĀMATI COFFEY: How bizarre.

SPEAKER: No, I’ll further rule. I’ve given the call to Tāmati Coffey. You can’t interrupt another member to take a call. I think we’ll start that time again.

TĀMATI COFFEY: OK, sure. Thank you, Mr Speaker. The irony of that previous member’s contribution is that we’ve just finished about, in this very House, the Ngāti Kahungunu ki Wairarapa Tāmaki nui-a-Rua Claims Settlement Bill, and that’s poignant for this moment, because the member stood and he talked about how all of these spooky little concepts like te Oranga o te Taiao giving effect to the Treaty were at odds and had no place in future environmental management. I completely disagree with that, and I think that he’s at odds with the previous contribution from his own party, which supported the Ngāti Kahungunu settlement and which actually talked about the environment in their settlement and the relationship that they’re intending to have with their environment. And they’re not the only ones. We’re at the end of a very long journey in this House of addressing our historical wrongs when it comes to Te Tiriti o Waitangi. The Crown has accepted the wrongs over the many years, and we have had settlement after settlement. That has changed the game. That has changed the game, and it has meant that Māori do have expectations that if we are going to reform our environmental management system, they do want a more meaningful say.

So it was through the work of the Environment Committee—I want to take a moment to thank the Minister for actually giving us a really good run-in to this bill here. Through putting up the exposure draft into the Environment Committee, that created all this engagement with practitioners, with iwi, and with lots of different stakeholders all across the country so that they knew what was coming. This has been well signalled. We understand what this is; this isn’t a shock. I do hope that we get more contributions in through the select committee, but I should think that, actually, the first lot of submissions that we got with the exposure draft actually highlighted some of those main points, and hopefully those different stakeholders will see that a lot of that has tried to be addressed in here.

So the opportunity to be able to give effect to Te Tiriti o Waitangi—yes, it is a change. But, obviously, we talked about it as a committee, and we thought we actually need to develop that a little bit more. We need to give some more guidance about exactly what that looks like so that people that are practitioners that use this legislation can do it with ease. The concept of te Oranga o te Taiao: again, we broadly talked about it with the exposure draft. There was the requirement—we heard a lot of people saying that they need more guidance in that space as well and more clarity and legal certainty to be able to implement it. And hopefully we can move in that direction. But I think it’s a credit to the Minister and a credit to the direction of this legislation that we’re willing to engage in good faith, because that’s what our iwi Māori have done for a very long time in this House with their own Treaty settlements; they have engaged with this House in good faith. And we’re engaging with good faith back again.

The role of Māori in the system is going to ensure that we uphold our Treaty settlements, ensure that we uphold those commitments and those arrangements, and ensure that Māori maintain the established decision making and participation at a regional but also, across the board, at a national level. We know that the Resource Management Act (RMA) has not supported the aspirations when it’s come to housing for Māori especially—for Māori especially because there is a lot of under-utilised Māori land sitting all across the country that could absolutely be part of the housing crisis solution. But, actually, the RMA hasn’t done a great job in being able to take those barriers away and enable that development to carry on. So I look forward to the kinds of changes that we’re going to see in this area.

I want to note as well that there was a statement put out by the housing Minister, Megan Woods, when she talked about these reforms and being able to set a national direction on things like papakāinga—we’ve never had something like that before. I look forward to that and how that might roll out in our various communities. Practitioners like University of Auckland’s Māori architecture professor Anthony Hoete talked about current planning restrictions not keeping up with the needs of Māori. Even the concept of moving away from individual dwellings into multiple buildings on one site—all of this is enabled by the new direction that we’re taking in the system.

And I wanted to talk to the point that the previous member made about where the voices of the community are going to be upheld. And I want to tell him that, actually, it will be, and we’ve been really cognisant of making sure that our communities all across Aotearoa have a say. And so, similar to the RMA, communities are going to be able to make submissions into the regional spatial strategies, into the natural and built environments plans, and we’ve got that regional planning committee that’s going to ensure that any person or any entity can make a submission into that process.

Whatever happens here, it’s an exciting time for iwi Māori to be looking at these reforms and seeing themselves reflected in these changes at a regional level and at a national level as well. And I’m very glad to understand that there will be an independent national Māori entity that will be monitoring the Te Tiriti performance in the system and that will be able to provide input into the national planning framework to be able to provide recommendations to both central and to local Governments as well. And it’s intended to do it in a way that does not usurp the mana of Māori in any area. I look forward to these changes, and I commend it to the House.

SPEAKER: This is a split call. I call Sam Uffindell—five minutes.

SAM UFFINDELL (National—Tauranga): Thank you, Mr Speaker. I stand here to speak as the representative from Tauranga, the city that has the most expensive housing in the country—the fastest-growing city in New Zealand, and one that is beset by planning issues. We have the largest port in the country, and we need to expand that with a third berth. And, as the Minister will well know, we have been completely unable to get anywhere near doing that, and very soon we will reach capacity. We have significant housing constraints, and we don’t have the incomes that support the enormous amounts that people in our city have to pay for housing.

We know that the Resource Management Act is responsible for a great deal of this, and so I came here hoping that this bill, the Natural and Built Environment Bill, would help to address it.

Hon David Parker: It does.

SAM UFFINDELL: Unfortunately, Minister, I’m not convinced that it does. I see this bill as adding more bureaucracy, greater complexity, and more uncertainty into our planning and resource consent process. It puts a significant amount more on the plate for people to consider without any hierarchy in relation to the competing values that they will need to look at. Part 1 of the bill came in—and it’s there; the Hon Scott Simpson has it in front of him.

Hon Member: Have you read it?

SAM UFFINDELL: I have not yet waded through the enormous, two-tonne monolith that’s just been handed to me. This is part one of three. I’m not sure that it is going to get the job done. We are a small country, and we have significant infrastructure deficits. If we’re going to take those seriously, we need to be a lot more dynamic in the way we do things. Unfortunately, on this side of the House, we do not believe that this bill achieves that.

We note there is significant legal uncertainty, and that’s already been discussed here today, with the effect of te Oranga o te Taiao—my apologies if I didn’t pronounce that correctly—coming in. We have never used this in the New Zealand legal system before, and we know that that is going to create significant work for lawyers. Good if you’re a lawyer; I’m not.

Hon Scott Simpson: The Minister used to be one.

SAM UFFINDELL: The Minister did. And there is going to be a significant amount of work to determine exactly how that is to be implemented. You look at all of the outcomes that this bill must achieve—looking at protecting ecological integrity, the mana of air, reducing greenhouse gas emissions, conservation of cultural heritage, protection of customary rights—and then actually try to get things done like build houses. There’s absolutely no hierarchy given to it. So we can all see where this is going to land up. It’s going to end up in a legal quagmire [kwag-mahyuhr], with an extra level of bureaucracy in there—

Hon Member: Quagmire. [kwog-mahyuhr]

SAM UFFINDELL: —quagmire [kwog-mahyuhr]—I’ve been watching too much Family Guy, quite clearly!—trying to determine what to prioritise and what not to prioritise. But what it’s not going to prioritise is the development of New Zealand, and it’s certainly not going to prioritise the development of our city of Tauranga. We have four representatives here in the House today from our great area, and I would be incredibly surprised if any of them can honestly put their hand on their heart and say that this bill is going to improve the lot of Tauranga. [Interruption] There you go! Well, I know that that side of the House love it. It doesn’t mean you have to follow along like a bunch of lemmings, because you are clever enough to know that this is going to take New Zealand backwards.

It will take 10 years to implement; that is what we’ve heard so far. The regional planning committees are going to take control of it. We don’t know how that is going to look. We know that that will have to give effect to Te Tiriti. And that’s a significant, significant change from taking into account the principles of the Treaty. As the Supreme Court has noted, effectively this means to give effect, means to implement. I see this bill as something that will add another layer of bureaucracy, increased complexity, significantly increased uncertainty, and it certainly won’t help us address the huge housing and infrastructure deficits that we have in this country. I oppose this bill.

DEBBIE NGAREWA-PACKER (Co-Leader—Te Paati Māori): Tēnā tātou e te Whare. I rise to give a call on the Natural and Built Environment Bill. We will also not be supporting this bill, but not for the same reasons as the parties beside me.

Te Paati Māori cannot support the Resource Management Act (RMA) reforms until changes are made to protect and restore our environment and guarantee the rights and interests of tangata whenua. Resource management is one of the most important areas of law, especially to us as tangata whenua. What we have seen is that legislation of this significance should not be rushed. The Government must have the active consent of key tangata whenua.

Instead, what we have seen: key groups who have been asked to be engaged like the national Iwi Chairs Forum are urging caution and highlighting that the scale and pace of the reforms cannot be implemented on the ground. They also strongly reject the notion of a national Māori entity on the basis that it would undermine the rangatiratanga of hapū and iwi. While the Crown invited iwi technicians to the drafting process—and we compliment for that—we do ask: why did they refuse to release all sections of the bill to its Treaty partners prior to introduction to the House. Only when they signed confidentiality agreements could they get parts, and then they were sharing it with their own people.

This is not a partnership, and this is an example of our concerns. Yes, there are some improvements from the existing RMA, but in other ways, we’re concerned that the bill is taking us backwards. Co-governance is only a step on the road to realising our rights as tangata whenua. These bills don’t go far enough as far as we’re concerned. Māori will be a minority on the crucial, important regional planning committees, rather than being able to exercise their rangatiratanga and kaitiaki leadership that is inherently our right. When it comes to the core purpose of resource management law, the protection and restoration of the environment, this bill is even worse than the existing RMA.

These reforms only require a setting in environmental limits that we believe are preventing ecosystems degrading from their current state. This is despite the situation across many areas where maintaining ecosystems at their current state is not sustainable. So the current resource management regime at least requires sustainable management and environmental standards to reflect that safeguard. That’s not what we’re seeing projected here.

It’s clear to us that the new regime will favour developers at the expense of the natural environment, which undermines the Government’s own core objectives with these reforms: protecting and enhancing ecosystems. We are currently facing unprecedented biodiversity crises and the imminent collapse of many ecosystems integral to our way of life. To weaken baseline environmental protections at a time like this is a real worry.

We note that the transition provisions provide for a slow roll-out across the country. This means the RMA and new legislation will operate side by side. This level of complexity will not be easy for mana whenua to manage. It also undermines unified systems across the country and proposed objectives for the reforms.

So, once again, we believe mainstream interests are being catered for first and those protected by Article 2 of Te Tiriti come second. The Tiriti clause now uses the language “give effect to” rather than “take into account” mirrors the Conservation Act 1987 is an improvement on status quo. But this still falls short from our perspective of requiring the Crown to honour Te Tiriti, despite their precedent for that language in the Education and Training Act.

Is this really the best the Crown can do in 2022? From our perspective, no. We can do better and we hope you will. On an issue as important as this, we think you should be striving for more cross-party support.

From our perspective, we will seek a range of amendments, including setting environmental limits that require the restoration of ecosystems from their current state; holistic application of te Oranga o te Taiao, including cultural and social determinants; increasing Māori appointments on regional planning committees, so that they make up at least half of the committees; change and give effect to Te Tiriti to honour and implement Te Tiriti; express explicit acknowledgments of the articles of Te Tiriti—rather than the principles—and of tino rangatiratanga; and removing reference to the national Māori entity in favour of reference to accountability and oversight of structures that are determined by the national Iwi Chairs Forum and National Urban Māori Authority.

Our hope is that the Government is willing to work with us to set stronger environmental limits and ensure the framework gets consents from tangata whenua so that we will be able to support this bill into law. We look forward to ongoing discussions at the select committee and beyond. Kia ora koutou.

ANAHILA KANONGATA’A-SUISUIKI (Labour): Kia ora e te Mana Whakawā. It’s an honour and a privilege to stand here to make a contribution to the Natural and Built Environment Bill. I have sat here and I’ve listened to everyone’s contribution to this bill, and it’s really fascinating. I’d like to take this opportunity to thank Minister David Parker for his leadership, first of all, and for giving the select committee time to consider the details of this. Now, we call this the bill, but before, it was the natural and built environment exposure document. They gave us an opportunity as a select committee to consider what could be and what may well be a better bill for us to consider, which we are considering today.

It’s fascinating. When I hear contributions from the other side, they agree with the Minister that the system is broken, they agree with the Minister that it’s too costly, and they agree with a lot of things we’re saying, but at the same time, they’re saying that they oppose the bill. When I think of all their contributions, it reminds me of a well-thought-out, landscaped garden, where you think that the Ministers have looked at it and said, “All right, we really need a lot of experts to look at this well-thought-out, landscaped garden.”, and what the Opposition is saying is, “Oh, that garden is terrible. We need to do something about it, but we really don’t know what it is. Let’s just complain.”

I have heard mention of “This will take 10 years—this will take 10 years.” I think they weren’t listening to what the Minister had said, which is that this is a progressive change. We will go from a hundred regional plans to 15. What that means is that 15 plans will progressively be implemented to 15 regions, so some regions will get it within the first two years and in other regions, when it’s completed, it’ll be in 10 years’ time. So I urge all the regions, please, you can put in a submission and say, “We’d like to be considered first in the implementation of this natural and built environment.”

There are over 800 pages in this bill. I asked Rachel Brooking, because she’s an expert on this matter, and I said to Rachel Brooking, “OK, for me, how do I read this at a high level?” There are three parts to the Natural and Built Environment Bill, which are the National Planning Framework, natural and built environment plans, and consents. I’m asking those who think that this great big, massive, 800-page document is too difficult to please have a look at the clauses where it talks about the principles—oh, here it is. Please have a look at the clauses where it talks about the principles.

Can I remind the House, clause 3 in Part 1 talks about the purpose of the bill. It talks about the purpose of the bill. Clause 4—like the member Tāmati Coffey has gone into trouble by giving us an explanation—is about giving effect to the Treaty principles, clause 5 sets out the outcomes, and, of course, clause 6 sets out the principles for the Minister and the regional committees for decision making.

So I will leave the details there, but what I want to urge communities to do, communities like those where I’m from in South Auckland, young people, Pacific, ethnic communities—this is the time for us to make a contribution. Please make a submission. We, as the select committee, are going to give opportunities for those who want to make a submission to either have it written or see us in person.

Budget 2022 for the Government has three goals, and we know what the goals are. One is to continue keeping the country safe from COVID-19; two, accelerate recovery from COVID-19; and number three, it’s about laying the foundation for the future, which is what this bill is all about. It’s about laying the foundation, how we are going to build wellbeing. Number one is to keep New Zealand safe from COVID-19—continuing that—and number two is to recover. But what I want to say is that this was going to be high level. This is part of the Government’s work in terms of laying foundations for the future—I’ll keep going—laying foundations for the future. This plan is well-thought-out. I commend the Minister on his work on this, and I commend the bill to the House. Mālō ‘aupito.

Stuart Smith: Mr Speaker.

SPEAKER: Oh, I’ve got about 10 seconds to go, so I don’t know if I—there we go. It’s come time for me to leave the Chair for the dinner break. The House will resume at 7 p.m.

Sitting suspended from 5.55 p.m. to 7 p.m.

STUART SMITH (National—Kaikōura): Thank you, Madam Speaker. It’s a pleasure to take a call on the Natural and Built Environment Bill. There certainly is agreement across the House that the Resource Management Act (RMA) is broken, and it does need to be repealed. I think every MP in the House will have had constituents who’ve approached them with the frustrations that they’ve had through trying to get resource consents for a range of things. Unfortunately, the legislation is absolutely the cause of those problems, and I think what’s exacerbated it, often, is the enthusiasm and the vigour with which council officials have taken their roles on to interpret what the legislation means on the ground, the processes that are gone through—whether a report is good enough or not—before you get through the stage of getting a consent actually approved or declined. And let’s face it, any of this legislation should not be just about allowing people to do what they want, it has to meet limits—and those limits are best decided at the community level, and I’ll come back to that a little later.

Examples of things that really have perverse effects: mobile phone towers often end up being put in the wrong place because the consenting authority says “No, it can’t go on that, it’s better to go on that one” and, actually, everybody’s worse off because the original place that they wanted to put it in would have had a far better mobile phone coverage. So it has a real impact on everybody’s lives—in fact, in some cases, it’s a safety issue. The Port of Tauranga, which was mentioned before by my colleague Sam Uffindell, and the issues they’ve had—also, I know Timaru Oil Services, which is a relatively new petrol retailing and importing company, wanted to have an import terminal, or build some tanks at least, in Tauranga; and they couldn’t get a resource consent. So we will be debating another bill at some point this week around competition in the fuel retailing space. And, actually, the issue, in this part, is being held up by the RMA. So competition is there, but it’s constrained because of the RMA. We had the same issue with the supermarkets and all of the covenants put on land and around those areas so other competitors couldn’t come in.

I think some of the real doozies, though, are the Christchurch flats that were declined permission to put a turning bay within their flats because it would have a visual impact for pedestrians. I mean, these are the sorts of decisions that can come across it. But I think another one that’s of real interest to this debate is the suburban hospital in Auckland that for four years has been trying to obtain a resource consent to build more capacity, much-needed capacity, but it’s been held up by one objector. I think you may well have heard this person’s name—the objector is Tony Randerson QC.

Hon Scott Simpson: KC.

STUART SMITH: Oh, sorry—KC it is now. That’s quite right.

Hon Scott Simpson: Not the same one that chaired the committee?

STUART SMITH: Well, it’s the same name isn’t it? I think it might well be, it might well be. So what hope do we have of a legislation that is going to avoid those sorts of nimbyism—or the power of the nimby not being curtailed? I think it’s probably highly likely that that’s not going to change at all.

I’d like to also talk about—it says under section 5 “[Protecting] or [restoring] the ecological integrity, mana, and mauri of the air, water, and soils; the [coasts], wetlands, estuaries, lakes, and rivers … and biodiversity.” Fantastic—you know, I think we’d all agree that those things should be protected. But then it goes on to saying “[reducing] greenhouse gas emissions.” I don’t know what this bill would have to do with greenhouse emissions. That is covered under the Emissions reduction plan, it is covered under other legislation—why do we need another piece of legislation just to muddy the waters, just to add more complexity? In fact, climate change is the new religion, actually, in a way—it has to be put up in every bit of legislation, it has to be referenced in every speech, practically, by the true believers, or they’re not doing their bit. And I think this will do nothing to help climate change whatsoever.

It also is recognising the relationship of iwi and hapū and the exercise of their “kawa, tikanga—including kaitiakitanga—and mātauranga in their… [ancestral] lands, sites, wāhi tapu, wāhi tupuna”, and other taonga. I don’t have an issue with that; no issue at all. But I’m the fifth generation on my family’s farm. I’m no longer living on it, but my family are there. If my children were there, they’d be the sixth—my nephews are the sixth generation on that farm. My ancestors broke that land in; they developed it. They tamed the rivers, they planted willow trees to contain the rivers within their banks, something that hadn’t been done—that’s the Canterbury Plains; I come from mid-Canterbury. Those rivers wandered all over the plains, that’s how they were formed—when people wanted to develop the land, they needed to contain them. All of that was done without a resource consent. I would argue that my family and my wellbeing is tied to that land—why am I not mentioned in this legislation? We are in a country where one law is there for all. We are all equal under the law, but this seems as though some are more equal than others, and I don’t like that—and I don’t think New Zealanders like that either, and I don’t think it should be in the legislation.

Harete Hipango: Ahi kā, Stuart.

STUART SMITH: Yeah, well it can be called whatever it likes, but it’s still the same. But I think that everyone has a deep relationship with their past, and I think that to single some out from others is unfair.

It’s interesting that we now talk about, in the legislation, outcomes rather than effects—and I think that’s fantastic; that’s what we should be doing. Outcomes are what is important, and congratulations for doing that, Minister, I think that’s a good thing. However, it still refers to effects quite a bit throughout the legislation, so I’ll look forward to going through the select committee process for the practitioners that have to deal with this to see what impact that will have—if any—on the bill and how it is introduced, and whether it will have some impact on it. I don’t know whether it will or not.

As has been mentioned, it certainly looks like the ground is being laid for co-governance. I, certainly, from the National Party standards, am absolutely against that in this sense of the word; co-governance, as far as the Treaty settlements that have gone before it are concerned, are a different thing. I thought that we should come up with another name for it, rather than co-governance, because I don’t think that’s exactly what that means. The bill says “to give effect to the [Treaty] and the [Treaty] principles”—the Treaty principles are actually up for debate! We asked, actually, when the officials were in, “what are the principles?”—and they said they don’t know, because the principles are still evolving.

So that is putting this RMAs reform on a foundation of sand if we don’t know what the principles of the Treaty are. I don’t even know why this should be referred to, quite frankly, in that we have other methods for dealing with those sorts of issues. Tāmati Coffey spoke before, and I think I absolutely agree with him about having access to their lands; and I think what a pity, what a pity that the Labour Party did not support the Te Ture Whenua legislation that was put up, which would have dealt with that and enabled Māori to have access to their land, access to their assets for their own betterment and wellbeing—but no, they didn’t, and I think that was a great pity.

I see the Minister has set limits for the national planning framework for air, indigenous biodiversity, etc.–including coastal water, estuaries, freshwater, and soil—and may also set limits in other aspects of the natural environment. Well, what a job! So we have to accept that the Minister is going to have the wisdom of Job; the wisdom of biblical proportions to make those decisions. Quite frankly, that is a disaster waiting to happen, and guess what—we all pay the price. In fact, the biggest issue New Zealand faces, outside of the tyranny of distance, is actually the economies of scale that we face in New Zealand, and the one thing we could be is nimble; this legislation is far from that. Thank you, Madam Speaker.

LEMAUGA LYDIA SOSENE (Labour): Thank you for the opportunity to be the final speaker and to make a contribution to the first reading of the Natural and Built Environment Bill. I have joined the Environment Committee this year, and it’s a real pleasure. I was a not a member at the time of the review of the resource management framework and the drafting of this bill, but I understand the Resource Management Act (RMA) has undergone a transformational journey, so I welcome the privilege to speak on this.

I want to acknowledge and congratulate the Minister, David Parker, for his leadership. This bill is very, very important in terms of the overhaul of the RMA. Despite earlier contributions, we are now at the point where this bill has been more engaging, and communities have had their say, and industry partners right across Aotearoa. The Environment Committee, in the next step of the process, will also have consultation to allow for more public scrutiny.

As we heard earlier, the repeal and the replacement of the RMA will reduce costs in consenting times and the resource consenting process in Aotearoa, which has become very costly under the RMA. In fact, it was highlighted earlier that between 2014-2015 and 2018-2019, council fees have increased by 66 percent for non-notified consents and 124 percent for notified consents, respectively. The consent system was taking longer with decision-making time frames.

Minister Parker appointed the 2020 Resource Management Review Panel to undertake a comprehensive review of the resource management system framework, with the main focus on the RMA. The aim of the review was to improve environmental outcomes and better enable urban and other development within environmental limits.

The RMA is broken, and consent fees have almost doubled. I want to acknowledge the multiple issues since the introduction in 1991, confirmed by a number in the industry—builders, and also in the legal profession—who raised a number of issues around highlighting time frames, planning mechanisms, including the RMA with so many processes and information to go through.

This bill, the Natural and Built Environment Bill, introduces new standardised conditions that will see fewer bespoke consents and, specifically, speed up the process. What is needed is a faster, cheaper, and better framework for resource management.

The plans under the RMA haven’t been working because it’s just taken far too long and cost New Zealanders far too much. The RMA is a major contributor to land costs being the least affordable in the OECD. The environmental outcomes have been poor, with degrading water quality, loss of biodiversity, and just the resource consenting. So there have been many actions to date—including the Randerson panel recommendations—with regards to looking at New Zealand’s natural environment under significant pressure; urban areas throughout Aotearoa have struggled to keep pace with population growth; the urgent need to reduce carbon emissions and to adapt to climate change; and, specifically, that iwi and Māori have an effective role in the system to be consistent with the principles of Te Tiriti o Waitangi.

Just as I finish up, to achieve the above objectives will address multiple problems in the current Resource Management Act, as highlighted by the Minister David Parker before the dinner break. Once the bill is enacted, it will be implemented progressively region by region.

In closing, I am optimistic that we will get there. I would like to acknowledge the chair of the Environment Committee, and members of the Environment Committee, who will continue to do the mahi and work really hard because they are committed to arrive at a better system for our country. I commend this bill to the House.

A party vote was called for on the question, That the Natural and Built Environment Bill be now read a first time.

Ayes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 45

New Zealand National 33; ACT New Zealand 10; Te Paati Māori 2.

Motion agreed to.

Bill read a first time.

ASSISTANT SPEAKER (Hon Jacqui Dean): The question is, That the Natural and Built Environment Bill be considered by the Environment Committee.

Motion agreed to.

Bill referred to the Environment Committee.

Bills

Spatial Planning Bill

First Reading

Hon DAVID PARKER (Minister for the Environment): I present a legislative statement for the Spatial Planning Bill.

ASSISTANT SPEAKER (Hon Jacqui Dean): That legislative statement is published under the authority of the House and can be found on the Parliament website.

Hon DAVID PARKER: I move, That the Spatial Planning Bill be now read a first time. I nominate the Environment Committee to consider this bill, too.

The Spatial Planning Act (SPA) is a vital part of the new system and provides for the development and implementation of long-term strategic spatial planning across New Zealand regions. This bill, the Spatial Planning Bill, will work with the Natural and Built Environment Bill, read a first time just earlier.

In December 2020, when Cabinet agreed to repeal and replace the Resource Management Act (RMA), it set five objectives for the reform: first, to protect and restore the natural environment; second, to better enable development within biophysical limits, stripping out the excessive reference to amenity in the existing statute; third, to improve system efficiency and effectiveness and to save time and money; fourth, to give effect to the principles of the Treaty of Waitangi; and fifth, to better address risks from climate change and other natural hazards. The Spatial Planning Bill will work in tandem with the Natural and Built Environment Bill to achieve those objectives.

Can I thank the members who spoke on the first bill for their contributions. One thing that I thought was common to a number of the submissions from the Opposition was some scrutiny at select committee as to whether there is a need for some priority of clause 5 matters. There is some, accorded by clause 58 as well, but that’s an issue that I look forward to seeing advice from the select committee on.

The Spatial Planning Bill will create a more efficient planning system that takes less time and cost. It will cost less; it will better identify where housing and infrastructure will go, earlier in the planning cycle. This provides certainty to local and central government as well as to developers and infrastructure providers—enables them better to plan and fund their investments. The Natural and Built Environment Bill will put the detailed policies and rules in place to implement the regional spatial strategies, as well as making improvements that mean consents and designations can be delivered more efficiently.

Long-term spatial planning aids these objectives. It assists with infrastructure investment, land-use planning, climate adaptation, environmental protection and restoration. This bill requires the creation of regional spatial strategies for each region. They’ll set out a vision and objectives for a region’s development and change over a 30-year-plus time span, and focus on big issues and opportunities facing a region. A regional spatial strategy won’t address everything that needs to happen in a region; rather, regional planning committees will determine the key issues that need to be addressed, in consultation with their community. Where a strategy is not required for the entirety of the region, strategic plans can be made at a more localised level.

To address concerns from local government that central government agencies are too often uncoordinated and difficult to corral, the central government member will be responsible for communicating central government priorities. Over time, regional spatial strategies will become a vehicle for the delivery of infrastructure in the right places, in the right time. These are needed to provide clear signals to the private sector, as well as local government and central government agencies, like those responsible for transport and housing. The SPA will also unlock long-stymied development and industries such as aquaculture, and ensure that the infrastructure that new industries like aquaculture need—like wharves—is coordinated.

Regional spatial strategies will identify, in general terms, where urban expansion is expected in the future. This will guide decision making by identifying existing and future infrastructure needed to align with long-term regional growth. Infrastructure identified in a regional spatial strategy will be considered against narrower tests at a time a designation is sought, leading to efficiency gains. The regional spatial strategy will also identify areas that should be protected from development, such as areas with significant biodiversity or highly productive land, or areas at risk from sea-level rise. Regional spatial strategies will be accompanied by implementation plans that can set out triggers and key actions for delivery partners to implement, along with an approach to monitor and report on delivery. Where appropriate, they can be supported by more detailed implementation agreements.

The Parliamentary Commissioner for the Environment has suggested to me that the focus of regional spatial strategies should be prescribed to cover only areas that have been identified as key growth areas, or areas experiencing environmental pressure, and I look forward to feedback from the select committee on that issue, too.

In summary, the Spatial Planning Act will fill a critical gap in the current resource management system by delivering long-term spatial planning across New Zealand regions. Together with the Natural and Built Environment Act, this legislation will deliver a resource management system that, in contrast to the RMA it replaces, will deliver a faster, cheaper, and better system. In respect of the point that has been made by some submitters as to the length of the statute, the new bills—combined—are actually shorter than the existing system—

David Seymour: By how much?

Hon DAVID PARKER: If you include the codification into the primary statute of the fast-track legislation, which is currently separated, the bills are about 20 percent shorter. If you want to contrast that with Australia, Australia has a similar length primary statute at the federal level, plus 600-page state legislature Acts; so their planning provisions are much longer than ours. That’s no reason to say that there’s nothing to aim for, but the legislation here is shorter.

I would also make one other point about the idea that comes from the ACT Party that you can rely, just about solely, on private property rights, to sort out these issues. I would point out—

David Seymour: It’s not the ACT Party’s idea at all.

Hon DAVID PARKER: Well, that was—private property rights and public law rights were the two things that they said they would rely upon, and I would contrast that to the position taken by the ACT Party in respect of the three-storeyed medium-density residential zone. I do think that the new system will have outcomes that are better for the provision of housing, as well as the provision of infrastructure. I’m interested in hearing submissions as to how these things knit together—the SPA and the NBA—and I commend the bill to the House.

Hon SCOTT SIMPSON (National—Coromandel): Thank you, Madam Speaker. They say that the road to hell is paved with good intentions, and there’s more than an element of that analogy in this piece of legislation, because what this second leg of the Resource Management Act (RMA) reform trifecta that the Government is introducing, effectively, does is create another level of local government, another level of bureaucracy. But a scary one at that, in that there is almost no potential for electoral accountability, for democratic accountability of the people who will be making very significant decisions on a regional basis about what gets built, where it gets built, how it gets built, and what impacts that will have on the lives and wellbeing of the people that live within that region and, indeed, the cumulative effect of those plans across the whole country.

So this piece of legislation has some lofty ambitions. In the Minister’s legislative statement, it says that “The [Spatial Planning] Bill mandates long-term spatial planning at the regional level through the development of Regional Spatial Strategies. It will enable and drive changes in land use and the coastal marine area, while protecting and enhancing the natural environment. It will integrate planning across different legislative frameworks that are associated with the management of the natural and built environment.” Now, that’s very motherhood and apple pie—hard to disagree with it, except when one delves a little into the detail of what it might mean and how the implications of such planning might have actually perverse outcomes that go directly opposite to the lofty ambitions and intentions that the Minister’s new planning model has.

So there are going to be these committees all around the countryside—15 of them. The legislation defines the minimum membership requirement, but it doesn’t define how the district councils will appoint the base members to these new planning committees. And as one of my colleagues—Chris Bishop—said earlier in the day when he was talking on the previous piece of legislation, he’s seen more than a few local government stoushes in his time—haven’t we all. And the potential for enormous conflict and one-upmanship and regional and district scrapping over the representation on these committees is practically never ending.

And then, of course, we come to the mana whenua representatives—there will be a minimum of two. There’s nothing in the legislation that defines how those two people will be selected. I’ve always been of the view that if people are going to be put in places of decision making that have impacts on other people’s lives, their businesses, and their wellbeing, then there should be some accountability about it. There should be some clear pathway and definition about how people are elected and appointed, and then accountability through the recourse of a ballot box actually is the safest methodology, and that should occur. Now, there appears to be, in the make-up of these committees, almost none of that basic democratic principle about the way that the committees will be formed, how they will be shaped, who will sit on them, what the definitional requirements and capabilities of those people will be, and what kind of accountabilities they will be subject to.

Now, I want to just for a moment talk to the House a little bit about some of the practical issues that this piece of legislation may have in terms of consequential impact. So, clearly the establishment of these committees is a step for a further reduction in democratic accountability. So, for many parts of the country, for instance, in my own area of the beautiful Coromandel, decision making will move from Thames to Hamilton; and decision making, for instance, for Carterton will move to Wellington; and for Kaikōura to Christchurch; and from Ōpōtiki to Tauranga. Now, those smaller communities do have unique and individual requirements, ambitions, and ideas for the future of their regions and districts, and they don’t necessarily want those to be reflected by an unelected, unaccountable group of people who don’t live, work, or recreate in the areas where those smaller communities are represented. So we on this side of the House are very concerned about the issues relating to the predictability of outcome from these regional committees, their efficiency, and the timeliness of what they are seeking to do. We remain very sceptical about those things.

So a lot of this is based on theory. And yes, there will be not so many plans—there’ll only be 15 plans. They will be 30-year plans. Yes, that’s a smaller number than the 100 plans now, but they are plans still. So just because there are not as many plans, it doesn’t mean that the impacts of those plans is not going to be as powerful or even more so than the ones that exist now. So these regional spatial strategies will define where everything will go. And then it’s going to be, in theory, really easy for people to get stuff done if those things are clearly defined. Well, I would just say that that’s exactly the situation we have now. Nothing much has changed, except, under this new model, I think it’s going to be worse, because your consenting authority has to now avoid compromising the wellbeing of future generations before you can get a resource consent. That’s going to be very tricky. What does that actually mean and how will it be interpreted? What are the practical applications of that? Now, members of the Government will say, “Well, that’s all very fine and dandy.”, but it’s the practical application that is the problem.

So let’s just think for a minute about, potentially, the unintended consequences of a heavily planned city. So clause 17 of the Spatial Planning Bill states that a 30-year spatial plan will include “(1)(l) the indicative location of planned or potential business and [recreational] activities and the likely general scale and intensity of those activities”. So they’re going to plan where businesses can go and where houses can go. So what happens, for instance, if a spatial plan for a new suburb includes the indicative location of a supermarket? Now, is it easier to get a consent in that one place? Well, apparently it will be easier to get a consent in that one place where supermarkets have been designated. So the person who currently owns the land where that new supermarket designated place will be has suddenly had a windfall advantage in terms of being able to sell land to supermarket developers because the area has been defined. And that will be an issue for sure. So the person who owns that land now has a monopoly on the supermarket land, and so they can land bank and then extract a premium price. Rather than paying for a consent, the investor is paying more for the land, and so the price ratchets up again. And once they build their supermarket, clearly then there’s a very low threat of a competitor building a supermarket there because the designated land has already been designated. And so the grand plan starts to look very, very intrusive.

What about if they get it wrong? What happens if the town planner who has decided that this will be the supermarket area of the city—the supermarket precinct, if you like—what if they’ve got it wrong and they choose the wrong area? What if the demographics change? What if the movement of people and traffic changes and the supermarkets are suddenly in the wrong place; what happens then? What happens if, for instance, those planners actually get the whole thing wrong and there’s a move against supermarkets in years to come and we start getting minimarkets are all the rage? Well, what happens if they shift the theory to the practicality and get it completely wrong?

So there are some very big potentials for unintended consequences in this piece of legislation. I don’t think the Minister or his advisers have really thought through that stuff. So, again, on this side of the House, as we were in the first piece, the Natural and Built Environment Bill, we are sceptical of the outcome, we’re sceptical of the theory, we don’t think it’s nimble enough, and we will be opposing this legislation as well.

RACHEL BROOKING (Labour): Thank you, Madam Speaker, for this opportunity to speak twice in one evening, this time on the Spatial Planning Bill. As we’ve heard from the other speakers, particularly that last speech, it’s very closely linked to the Natural and Built Environment Bill, and you’ll see throughout the bill that there are lots of references to terms and the purpose of that Natural and Built Environment Bill. Unlike the purpose clause of the Natural and Built Environment Bill, we did not, at the select committee, have an exposure draft for this, so this is a new piece of legislation for the committee. It was, however, part of the Randerson review’s recommendations to have a bill like this.

Just quickly, though, those links that it’s got with the Natural and Built Environment Bill include this regional approach that Scott Simpson just spoke to, and the idea of requiring these plans to be made at the regional level—so Otago, Southland, Canterbury, etc.; showing my southern bias there—is to make it more user-friendly for those people who want to use these plans rather than having to go through the plethora of plans that you have to use at the moment. Also, like the last speaker said, there’s a regional planning committee, and that’s all spelt out in the Natural and Built Environment Bill. But the difference for when the spatial plan is being made is that there’s a Crown appointment to that plan.

Also noting the definition of “infrastructure”: infrastructure’s defined in the Natural and Built Environment Bill, and it is very wide and it goes quite a lot broader than the Resource Management Act (RMA) definition, that includes mainly pipes; it also now includes Kāinga Ora, hospitals, waste disposal facilities, schools, and fire and emergency services. That’s useful, because the problem that this bill is trying to address is that lack of coordination between the infrastructure that we need when we have new development happening. The idea of having a spatial plan at that regional level is that it goes for a 30-year time frame—so it’s looking out much longer than the regulatory plan that you have currently under the RMA or that’s suggested under the Natural and Built Environment Bill. It’s really trying to knit together the planning of new infrastructure with those new growth areas but also protecting areas where we don’t want new growth.

What happens often is that when there is growth in an area, that means that infrastructure has to come with it. So people often think of roads, and, certainly, the Land Transport Management Act and land transport plans are very much part of the spatial plan, but also there are those other things, like, if you’re intensifying an area, do you need a new school? Do you need a new hospital? Do you need a new fire station? All these things—it’s very useful to be able to think about them for the long term and in an integrated way.

So that is what this bill is trying to address and trying to work through, and my understanding of why it separated out is those relationships with the Acts such as the Land Transport Act and the Local Government Act, and that’s because the plans made under those Acts need to be consistent with or implement these spatial plans to an extent, but not entirely, because the spatial plan is a high-level document, and it’s important to note that at clause 66, I think it is—excuse me—“interest in land must be treated as not being taken or injuriously affected by any provision in regional spatial strategy unless [the] Act provides otherwise.” So it’s trying to sit above the regulatory plan. That regulatory plan in the Natural and Built Environment Bill must be consistent with the Spatial Planning Bill, and that’s found in a few sections in the Natural and Built Environment Bill. Thomas Coughlan noted that it was both clause 104 and 109, and I’m sure that’s something that will be remedied in the select committee process.

Also important to note, with that one extra person who’s on the committee being from Government, that there’s a duty to assist. That’s at clause 64, and so departments, Crown entities, local authorities, iwi authorities, groups that represent hapū, and network utility operators—they all must provide information or technical support to a regional planning committee. That is all part of the important coordination role that the bill’s trying to address.

So this is an important part of our reform of the resource management system, and it should lead to much better environmental outcomes in terms of protecting those areas that need to be protected but also enabling the development in the housing that we desperately need. Thank you.

STUART SMITH (National—Kaikōura): I know it’s a great treat to have another go on my feet on these linked bills. I think it’s a—

David Seymour: Not for the audience.

STUART SMITH: Well, yes—the audience are really enjoying it, I’m sure!

The regional spatial strategies, which the Spatial Planning Bill sets up will have a 30-year lifespan. And as was discussed in the last speech by Rachel Brooking—I think she really highlighted how complicated this is and how these things are supposed to knit together and work seamlessly, while I’m struggling to see how that’s going to work. We’ve gone from 100 plans down to 15—and that sounds fantastic. What a great way—we’ll cut the number down. But the problem is that we’ve got lots of councils around New Zealand and they represent communities of interest, and their licence to operate, if you like, in a public sense, is that they represent their communities, and, when they get too big, they become a real problem, and Environment Canterbury (ECan) is one good example of that.

There may well be others, but I can only speak from my own electorate’s perspective. The Marlborough District Council is a unitary authority, it’s a regional council, and it’s a territorial authority—they do a fantastic job, easy to do with one council; no issues there. All the planning situations all seamlessly work together. Yeah, of course there’s issues, but they’re not as bad as anywhere else—it’s a one-stop shop. But in the southern part of my electorate, we have district councils and we have ECan. Now, ECan stretches all the way up to the Clarence River—for those that don’t know, that’s in south Marlborough—and then goes all the way, including Christchurch along the main divide down into the Mackenzie Country. So it starts up in the great electorate of Kaikōura, it goes down next to Matt Doocey’s electorate and includes Christchurch, which—

Dr Duncan Webb: Duncan Webb’s electorate.

STUART SMITH: Dr Duncan Webb over there, and then Nicola Grigg, and then it goes to the highly respected MP for Waitaki, the Hon Jacqui Dean. And so what I would put to the House is that there is nothing in common with Kaikōura and Christchurch, there is nothing in common with Hurunui and mid-Canterbury, and there’s nothing really in common at all with any of them in the Mackenzie Country. And yet they are all under ECan. And that is why ECan is the car crash it is, because it does not actually—

Hon Eugenie Sage: Well, you put commissioners on for nine years, why didn’t they fix it?

STUART SMITH: —I think the Green Party have at last woken up—represent its community well at all, because its community is so diverse and not at all knitting together. And that’s exactly the way we see ECan operate, it’s an absolute mess. And that is what we will see when we go down to 15 plans, I have no doubt about that. I think the work now of the Commissioner for the Environment on his catchment work that he’s doing, that is the way to go to manage these sorts of things. Sometimes less is not more. And, I think, in this case, and when we’re talking about plans, it will definitely not be more and it will cause a huge amount of problems.

I’ll give you an example of central planning—this is what we’re talking about, essentially, central planning. I’ll give you an example of how badly that can go wrong, because I know Rachel Brooking and Angela Roberts have been wanting me to bring wine into our debate, and so I’m going to do that for you tonight. And so I’ll go back to the early 1970s, in Hawke’s Bay, and Montana Wines were looking to expand their vineyards and they wanted to expand and plant vineyards there, however, the planning rules wouldn’t allow them to do so. But this had a happy ending, because Frank Yukich, he got so frustrated with these planning rules that wouldn’t allow him to plant grapes and expand their winery operation, so he went off down on the advice of a Department of Scientific and Industrial Research scientist named Wayne Thomas, and had a look in Marlborough. He went around, he was so struck with the region, everybody thought “too cold”—the central planners said, “Too cold, couldn’t grow grapes there.” However, the Marlborough District Council were much more accommodating than Hawke’s Bay. And so he ended up with his own money, putting deposits on 1,600 hectares of land to buy for vineyards, not telling anyone. I know the land agent who’s now since passed away who went out and purchased these properties. He was not allowed to say what it was for, who was buying it—there were rumours going around Marlborough: “Somebody’s buying land up.” No one knew what it was for. Anyway, in the end they planted grapes there and then on 14 August in 1973, he said—I quote—“Wines from here will become world famous one day.” And how right he was, against all the advice.

Now, I can tell you there were a couple of other moving parts in that since the 1984 vine pull went on, there was an issue with Australia and New Zealand Closer Economic Relations and along came Ernie Hunter, and Ernie Hunter had sauvignon blanc. He went to the Sunday Times Wine Show in the UK—I’m coming to the bill, Madam, it’s all about central planning—and he won there and that is how sauvignon blanc got its start in the world. If we’d listened to the central planning rules, there would be no grapes in Marlborough, there would be no wine industry, and New Zealand would not have got there. So the point is that if we expect that central planning rules will get it right, they will not.

Now, the Minister mentioned aquaculture and the importance of being able to get the locations of wharves and things right. Well, I’m sorry, I don’t think that central planners are going to get that right at all. Businesses will either put it in the right place or they’ll put it in the wrong place and lose some money and someone else will do it in the right way. That’s how we get innovation. So I guess the underlying point I’m making is that we need the freedom in New Zealand to be able to innovate. That is one thing that we can do and we do it well. We have a reputation for being the number eight wire innovators. Well, I think it’s a lot more complicated than that and we don’t give ourselves enough credit for the innovation that we do do. But that requires a regulatory framework to allow those things to flourish. And central planning for those sorts of things will not work. Yes, we need some planning, there’s no doubt. I do think that we need to protect our best soils in New Zealand. I totally agree with that. Where you draw the line becomes a real issue though, and it’s a property right issue and people that are on what they feel is the wrong side of the line are going to be very upset about that, because it will actually make a significant difference to their economic wellbeing. However, those tough decisions do have to be made.

But, again, this bill has a number of issues which I canvassed before about, you know, “In preparing an RSS”—that’s a regional spatial strategy—“the [regional] planning committee must have [particular] regard to relevant iwi and hapū management plans and … must have regard to mātauranga Māori” as well. I don’t have a problem with that, as I said earlier in the previous bill. But what about everybody else? Do they not have any special interest in things that are happening in New Zealand? Why would it only be one group? People that have spent generations on that land and—I’ve forgotten, what was the term?

Harete Hipango: Ahikā.

STUART SMITH: Ahikā. Whose ahikā is better than anyone else’s ahikā? Whose is more valuable than anyone else’s?

Tāmati Coffey: Don’t steal our words—don’t steal our words.

STUART SMITH: I’m not stealing; I’m borrowing it.

Sam Uffindell: We’re all New Zealanders.

STUART SMITH: I think that is exactly the point—Sam Uffindell has just made an excellent point, “We are all New Zealanders”, and we are all New Zealanders. We forget that at our peril. I think enshrining things in legislation that call that into question is wrong—it’s just plain wrong.

Actually, while I’m on it and I’m on a roll, the decision of the Supreme Court shows the foolishness of getting rid of the Privy Council. We must have things—we want to have a say in our own way, not have activist judges expanding our legal system. And that’s exactly what we’ll get with this piece of legislation. It will be years of court cases, years of heartache. It will break some people, trying to get things done. It will end businesses. It will stifle innovation. And we’ll all be the poorer for it—all of us will be the poorer for it, except for the few people that get selected to be on the committees. And they’ll be well paid and they’ll be probably all related and we won’t have a chance of getting rid of them. And we should, if they’re going to have anything to say about our planning laws. This bill is as flawed as the previous one, so I condemn it to the House.

TĀMATI COFFEY (Labour): Thank you, Madam Speaker. Can I borrow a tissue? I noticed your box was closest.

ASSISTANT SPEAKER (Hon Jacqui Dean): Take the whole box. I live to serve!

TĀMATI COFFEY: Thank you, Madam Speaker. I can now start my contribution.

I really appreciated that contribution from the previous speaker, Stuart Smith, because he helped to highlight that actually, yes, we are all New Zealanders, but we come to this House acknowledging that we have a special relationship with iwi Māori and that, actually, as Crown, we must respect that in everything that we do. So, yes, he was absolutely right—we are all New Zealanders—but Māori have a very special place in that relationship, and, for that reason, have a special place in the reform of our environmental management system.

David Seymour: Special people.

TĀMATI COFFEY: What was that?

David Seymour: Special people, huh?

TĀMATI COFFEY: Yes.

Simon Court: What makes them special?

TĀMATI COFFEY: I’m going to carry on; I’ll let them keep talking to themselves. Maybe one day they can stand up and actually take a call on this, but, in the meantime, I’ll focus on my call, which is that this here is about long-term thinking, which is the thing that has to be encouraged here. For a very long time, Māori have taken a long-term view of our environment, but, unfortunately, our laws haven’t really enabled that.

Recently, more and more iwi and hapū are coming up with their 100-year iwi plans. This is something that is new, actually, but we’ve taken a really long-term view. It’s been really intentional. Back home in Rotorua, we have our own Te Arawa 100-year plan, and, of course, you can imagine what that consists of: the environment and the protection of the environment, the looking after of our lakes, the looking after of our rivers—all of those kinds of things that we deem to be important. We’ve got a saying in Te Ao Māori, which is “Toitū te whenua, whatungarongaro he tangata”—as we the humans come and go, the land remains. The land remains, and that’s what I want to talk about here. The Spatial Planning Bill is actually an attempt to insert some long-term thinking into the way that we develop our communities.

I want to use an example. In Tauranga, we have the Smart Growth plan and it’s been incredibly successful in being able to develop the transport arterial routes, the housing—how that’s going to go, the appreciation that it needs to be built back from the water’s edge because climate change is a thing. So there’s a big area of land that’s been specially pegged out as being land that you shouldn’t be building on, especially as we’re more and more aware of our climate change responsibilities. So that has been a real success.

Just the other day, I was driving along the Tauranga Northern Link and I saw that the next section of the motorway out at Te Tumu—they’re starting to develop that into an access on to the whenua there, which is going to be a big site for more housing, more communities, and more developments. What the Smart Growth plan has been able to do is coordinate all of that effort, using the local council, involving iwi into that conversation. It’s the way that things should be, but, unfortunately, they haven’t been done that way and we need to do better.

I want to talk about the spatial strategies so that as we develop these plans, we’re making sure that we are identifying those areas which are significant to Māori, and I can point to an example back in Rotorua where, a few years ago, the New Zealand Transport Agency (NZTA) had decided it was going to run a motorway through small Māori settlements on the eastern side of the lake. It was met with fierce opposition. It was eventually thrown out because there was such opposition to it. It ran through suburbs like Ngāpuna—translated, it’s about the springs, the many springs that sit in that area. NZTA at the time were really keen to knock through there and build a four-lane motorway through a place which had been renowned to our local Māori community—my iwi, my hapū—for being a place which was significant for the healing waters which sat underneath the surface. We need to do better. We need to do better when it comes to trying to coordinate what our communities look like into the future, and the Spatial Planning Bill is a big key part of that.

I look forward to traversing this through the Environment Committee as it tracks through. I look forward to the submissions that come before it and making sure that we’re creating a system which is fit for 2022 and which absolutely has got Te Ao Māori and mātauranga Māori and whakaaro Māori sitting at the heart of it, because Māori, for a long time, have been wanting this and I believe that it’s going to be welcomed with open arms. I commend it to the House.

Hon EUGENIE SAGE (Green): Tēnā koe e te Māngai o te Whare. I’m pleased to take a call on the Spatial Planning Bill. As others have noted, it does provide for a strategic framework for environmental management and regional development with a term for the regional spatial strategies of 30 years, but also looking out and being informed by climate change predictions over the next century. It will guide major decisions about how land and also coastal space is used and allocated.

As the Randerson review said, one of the frequent criticisms of the Resource Management Act (RMA) is that it has been too slow in responding to demand for increased housing, leading to higher costs and a great deal of inequity. That’s partly due to development occurring in an ad hoc way rather than being strategically focused, and partly because plan development has been quite slow and litigious.

At the moment, the Auckland Council is the only council that’s required to have a spatial plan and there hasn’t been a consistent framework in the RMA to encourage it. And as Tāmati Coffey noted, councils such as Tauranga and those in the Bay of Plenty, through Smart Growth, have worked really hard on doing spatial planning, but they’ve had quite a weak mandate and there’s been limited incentives elsewhere for councils to cooperate. It depends very much on the personalities of councillors and chief executives and just whether they actually get to do that. So they’ve had to develop, as they did with Smart Growth, their own governance and decision-making arrangements. So this bill is a step forward in providing that framework for spatial planning to happen across the country.

And as Rachel Brooking noted, it’s a really important step forward because one of the problems in areas like Tauranga—or everywhere, really—has been that central government agencies might be at the table sometimes, but there is no commitment to the funding to follow through on the decisions that are agreed about where infrastructure goes. Generally it has been the transport agency, Waka Kotahi. It hasn’t necessarily been the education ministry, health, in ensuring if you’re building new communities where the health facilities, where the schools and preschools go. So the Randerson review highlighted about five key problems: no outcomes focus on the RMA; poor alignment of land use and infrastructure plans; not enough focus on the long term; and that inadequate engagement and coordination between local and central government. The review team recommended that spatial planning was a key tool to achieve that integration and that has led to this bill.

As with the Natural and Built Environment Bill, it will be these regional planning committees with two iwi members and council representatives which will be the real workhorses to drive the development of the regional spatial strategies. They will cover, potentially, a large geographic area: the whole of the region, land and territorial sea. I envisage that they’ll map the pattern of existing infrastructure; the areas that will be subject to constraints because of natural hazards, flooding risk, sea-level rise risk; what areas are suitable for new development; and where new infrastructure should be located.

One of the issues, though, that means the Green Party is only supporting this bill to select committee is that the bill does appear, once again, to embed the bias in the RMA towards use and development rather than protection. Clause 17 includes the list of key matters that the regional spatial strategy should address, and the key matters in relation to protection, restoration, or enhancement are areas that may require protection, restoration, or enhancement. If we contrast that with all of the other matters, they are areas that are appropriate for urban development and change. In the Greens, we want to make sure that there’s the same investment in providing information, identifying areas that need protection because they’ve got threatened species present, where there shouldn’t be more vegetation clearance, there shouldn’t be more urban development—the same level of investment and research on that as there is on identifying areas that are suitable for subdivision. At the moment, words like “may” make it very, very vague and provide absolutely no certainty that nature will be better off through these regional spatial strategies.

Also concerned in the list of key matters was matter (d), which is “areas that are appropriate for developing, using, or extracting natural resources, including generating power:”, because, under a former National Government, there was a list of rivers prepared that were suitable for hydro generation. They included wild rivers, rivers like the Clarence and Marlborough, famed for rafting and kayaking. So we want to see a greater attention in the Natural and Built Environment Bill to tools like water conservation orders so that they actually do protect wild rivers, and we don’t see things like these regional spatial strategies identifying a list of rivers that generators would like to get their hands on.

One of the significant changes in this from the exposure draft is that we now have 15 regions. There was strong advocacy by Marlborough, Nelson Tasman, and Te Tau Ihu iwi that they shouldn’t be combined in a whole Te Tau Ihu top of the south region. So we do have Nelson and Tasman preparing their own regional strategy and Marlborough preparing its own, because there are quite different issues in terms of geography and particularly the big investment in aquaculture in the Sounds.

The provisions in the bill around public engagement and consultation are crucial because you cannot—if we’re preparing these regional spatial strategies with a 30-year life, being reviewed every nine years, they need to really engage with the public so that they have a real input in deciding what happens where and how they’d like their communities to evolve. We need much more innovative tools, things like citizens’ assemblies, polling public opinion, ensuring that children have a really strong voice, not just relying on the traditional submission and hearing process. But, again, there’s a bit of a concern here. Clause 32 certainly provides that the process must encourage participation, but there’s a qualifier that it’s “by the public and all interested parties, particularly those who may be involved in implementing the regional spatial strategy.” That potentially gives a stronger weight to the infrastructure providers, to the telcos and the corporate interests, and, again, weakens protection for the environment. So there needs to be really good and innovative participation, but not biasing certain interests.

One final issue is in all these regional spatial strategies, some of the key infrastructure will, of course, be around three waters. The House is going to go on to consider the Water Services Entities Bill, but it’s not clear—because you’ve got very different regions, 15 regions in this bill and the Natural and Built Environment Bill, but only four entities whose boundaries don’t match on to the regions—how this really good coordinated spatial planning will actually happen. And it’s not clear, too, about the relationship between the regional planning committees operating under the RMA reform and the regional representative groups. You really need that coordination, and there’s nothing that I can see in the Water Services Entities Bill and nothing in this bill which actually teases that out when three waters infrastructure is exactly the sort of infrastructure that we need to be planning ahead for.

One of the other major concerns is that the bill doesn’t appear to promote the precautionary approach in terms of—there’s quite a high bar to identifying areas where adverse effects might occur, rather than if there is a likelihood of those or we don’t have sufficient scientific understanding ensuring that those areas aren’t identified for development. So the Green Party is happy to support those to select committee, but we will be seeking some significant changes there and our position beyond that will depend on that. I really look forward to public submissions and am concerned that there may not be enough time to tease through all of the issues with this bill and the Natural and Built Environment Bill just in a six-month process.

SIMON COURT (ACT): Thank you, Madam Speaker. So, as a civil and environmental engineer, I ask, “What is the problem this bill is trying to solve?” Now, according to the text that accompanies the legislation, “Regional spatial strategies will identify big issues and opportunities facing regions and develop strategies and implementation plans to respond to them. A regional planning committee, comprising representatives from local government, central government, iwi, hapū, and Māori”—I thought iwi and hapu were Māori, but they “will develop a regional spatial strategy for a region. [And] All [people] exercising powers and performing functions and duties under this bill must [somehow] give effect to the [unknown and ephemeral] principles of [the Treaty of] Waitangi.”

My take on the problem that the Government’s trying to solve is that Kiwis are not building homes and businesses in places that the Minister and his planning advisers want them to. The Labour Government, of course, is suspicious of private developers and they hate cars, and this bill gives them all the power they need to sterilise private plan changes which deliver the best master-planned communities, for example.

As we heard last year, when the exposure draft of the Natural and Built Environment Bill was presented to the Environment Committee, this bill will give the central planners—appointed and approved by the Minister for the Environment, David Parker—the ability to limit where roads and highways can be built, even if they’re desperately needed to unlock access to ports and to new residential and commercial areas.

The intent of this Government is clear. We only need to look at those superb master-planned communities proposed for Drury South in Auckland; and Ōhinewai, the Sleepyhead precinct in the North Waikato. Local councils and central government agencies—Waka Kotahi—objected to these developments on two grounds. Councils claimed they couldn’t afford the infrastructure to connect these communities to the rest of the region. They proposed that for Drury, 60,000 additional people, and the Sleepyhead precinct in the North Waikato were not where the regional council planners had proposed that new towns and new people should live. Therefore, they objected. The New Zealand Transport Agency (NZTA) opposed any development on the Sleepyhead precinct and in Drury South on the basis that this might generate traffic on the State highway. Who knew? State highways—intended to carry traffic—but NZTA said, “No. We don’t want these new developments—they’ll produce traffic.”

So either they can’t afford to upgrade the network or they’re following the directions that their woke, car-hating Minister, Michael Wood, has set for NZTA. He insists that vehicle kilometres travelled—in other words, the journeys that we take—will be reduced by 20 percent in the next 15 years. Now, I’ve looked at planning maps; I’ve looked at projections. New Zealand’s population’s intended to grow by 1 million over that period; by 2 million by 2050. Apparently we’re going to be using private motor vehicles and delivering freight by trucks and vans at 20 percent of this. What absolute nonsense. But that’s the kind of central planning nonsense that will drive planning under this Spatial Planning Bill if it becomes law.

Now, these developments—at Drury South and Ōhinewai—were actually approved because the planning commissioners agreed with the developers. It’s important to deliver homes where people want to live, and to develop mixed-use commercial operations where people can work in the same place—what we call mixed-use developments. And that’s what good development looks like.

Now, if you think about the policy objective—the proposal—regional planning committees comprising representatives from local government, bless them; central government, whoops; iwi; hapu; and Māori to develop a regional spatial strategy for a region.

Imagine when planning how cities might be developed and might grow, that no one from business, from commerce, from infrastructure delivery agencies—even the Government’s own KiwiRail or NZTA or whatever they are—all communities are included on a regional spatial strategy development committee. How on earth will these planners know where businesses in future might want to build the distribution warehouse so they can keep things ready to deliver to their customers?

I mean, apparently the central planners appointed by Minister David Parker will know—and these businesses are just expected to build where he tells them. How will businesses know where to build the food court or a shopping mall or anything, for that matter? Unless Minister David Parker and his planning tsars tell them. Well, the Minister and his officials actually don’t care about that. They will have a vision of how and where cities should grow, and the rest of us people—who want to build new homes; who want to build new town centres and commercial operations—will just have to suck it up.

I can see the attraction to central planning, though. When I was an engineering student, instead of doing my assignments, I used to play SimCity. Fantastic PC game.

Hon Members: Great game!

SIMON COURT: Great game, SimCity, that’s right. Now, it’s a wonderful game: you lay out the streets and the infrastructure. You lay out the streets and the infrastructure first, and the tiny people on the screen would then organically build their homes and businesses where you built the infrastructure. And this bill misses the valuable lesson of SimCity: the role of Government is not to colour in planning maps, telling people where they are and are not allowed to build homes and businesses. The role of Government is to deliver the infrastructure, which enables communities to thrive and a healthy economy to grow.

This bill perpetuates the Resource Management Act (RMA) planning obsessions, which is colouring in maps but on a national scale. And with the cold, damp hand of the Minister for the Environment holding the colouring-in pencil, this bill fails to give us any sense of how the infrastructure needed to grow communities will be funded—will be delivered—to meet the needs of our people now and in the future.

Now, the commentary says, “This bill works in tandem with the Natural and Built Environment Bill as a single integrated system. [That] bill aims to recognise and uphold te Oranga o te Taiao and to enable the use, development, and protection of the environment, within limits and targets.” Well, wonderful! We don’t know what te Oranga o te Taiao is. We’ve heard it could take a decade to litigate through the courts what that definition means. It’s completely unhelpful. What Kiwis want to know is: will Government be there with the money to deliver the roading, the public transportation, the three waters infrastructure that’s needed to enable towns and communities to grow?

Now, one thing this bill points out is it’s helpful to have a 30-year time frame—actually, an approach which identifies what should happen in a region over 30 years. Now, this is ACT policy. What we say is, actually, local government should be telling central government where they want to grow—not the other way around—and that central government should come to the party with the funding and make sure that the infrastructure that’s delivered is delivered on time and on budget.

We believe in a bottom-up approach; that communities should tell central government what they want; not have planning maps imposed on them by a Minister for the Environment from his fifth-floor Beehive office. This Government’s got it all backwards. Central government, it says, will communicate priorities. The Minister said, “Central government will communicate priorities.” in his introduction just a moment ago. Well, ACT has a completely different perspective. How about communities work out how and where they want to develop through a democratic process, then central government comes to the party, clearing barriers to growth, wiping away regulations that stop people building, and planning to fund and finance the infrastructure?

Now, Labour’s addressed none of the problems that the RMA has delivered us. All they’ve done is insert a healthy—or unhealthy—dose of co-government into an already flawed system. Co-government has no place in our planning laws. This Government should take a property rights - based approach with people who want to build new homes or new towns, even—or they need to develop quarries, resources, mines for those valuable minerals we need for the low-carbon transition—so they can do so where those resources exist, where it makes sense to do so.

ACT will be announcing our alternative to this flawed RMA approach next Tuesday. We ask the people of New Zealand to pay attention; it’s a much better offering than this Government.

ANAHILA KANONGATA’A-SUISUIKI (Labour): Kia ora e te Mana Whakawā. It’s always an honour and a privilege to stand and make a contribution in this House. I need to respond to the last speaker, Simon Court. He said something that actually pressed my button. He said that we hate cars, and he kept saying something about the Minister of Transport, the Hon Michael Wood. I just want to remind the member who just spoke of the Wellbeing Budget that this Government is very strategic and we have goals.

So the goals for this year, in terms of our Government, are continuing to keep New Zealanders safe from COVID-19; secondly, continuing to accelerate the recovery from COVID-19; and the goal that I like—particularly about this bill—is number three, laying the foundations for the future, including addressing key issues such as our climate change response, housing affordability, and child poverty. This bill, along with the last bill I spoke on, the Natural and Built Environment Bill, is about that. It’s about laying the foundation for the future, housing affordability, and, in the end, getting our children out of poverty. The Spatial Planning Bill will provide, as many speakers have said before me on this side, a strategic framework for the environment management and regional development.

I’m really going to speak about Part 2 of this bill, the Spatial Planning Bill—Part 2, clause 12 and clause 17. So Part 2 sets out requirements for the regional spatial strategies. So each region must have a regional spatial strategy, except for the Chatham Islands territory and offshore areas administered by the Department of Conservation acting as a local authority. So those are the exceptions in terms of having each region needing to have a regional spatial strategy. I need to just say RSS, but I think if I keep saying regional spatial strategies, we might all get it by the end of this.

So the spatial planning, therefore, will help coordinate and integrate decisions made under the relevant legislations by requiring the development of long-term regional spatial strategies. In terms of clause 17, it talks about the contents of spatial strategies, so it tells us what must be in these regional spatial strategies. We’ve heard members before in the House mention something like protection and mention things about Māori, but it does set it out in clause 17. Clause 17(1)(a) talks about the “areas that may require protection, restoration, or enhancement:”, and it also goes on about “areas of cultural heritage and areas with resources that are of significance to Māori:”. The last speaker, he spoke before and he questioned, but my response to that is that he actually needs to go and read the information, unlike how he gave us an example where he didn’t do his assignment but he played games. I would recommend the member to go and read clause 17 that actually outlines the contents of the regional spatial strategies.

I particularly like 17(1)(f) where it talks about “areas of the coastal marine area that are appropriate for development or significant change in use:”. We have seen, in most of this year, the devastation of climate change on the shores of some of our areas in the country, and I think 17(1)(f) refers that each region must have this in terms of coastal marine [Coughs]. Sorry, I think Mr Coffey wanted a tissue before; I might need a glass of water. Thank you. It’s the passion, Madam Speaker.

I just need to remind everybody what in the contents they actually need to know in terms of clause 17. I would like to remind everyone that’s watching, including everyone in Papakura and in South Auckland: please put in a submission. We want to hear your voices because it is those voices that are missing in some parts of our talk. I commend the Minister and I commend this Spatial Planning Bill to the House. Mālō.

ASSISTANT SPEAKER (Hon Jacqui Dean): Sam Uffindell—five minutes.

SAM UFFINDELL (National—Tauranga): Thank you, Madam Speaker. I’ll make it a good five minutes. I just want to comment, firstly, I heard the previous speaker, Anahila Kanongata‘a-Suisuiki, mentioning about encouraging people to make submissions. I would also encourage people to make submissions, and I’m sure there will be quite a lot of them. I hear there were quite a lot of them on the three waters legislation—88,000 or so. I’m not sure whether they were properly waded through, but I would encourage a lot of submissions on this bill.

I would also encourage the Minister to make sure that the select committee process can be extended to make sure that all of those submissions can be properly heard, whether that is being read or whether that is in person, because we should all know this. I mean, this is a significant change and it will have a significant impact. I think we’ve gone over it a fair bit tonight and earlier this afternoon on the earlier bill about how the Resource Management Act (RMA) was not a fit for purpose piece of legislation and how we all had significant hopes that these bills, or this trio of bills, would, you know, go about amending that. That side of the House is quite certain that it will, and I think everyone over here is pretty aware that it won’t.

We acknowledge that we have a very expensive housing market in the developed world. We have a lot of red tape, we have a lot of bureaucracy, and we see this bill as adding more bureaucracy, more complexity, and more uncertainty to an already bureaucratic, complex, and uncertain situation.

We have argued for fundamental RMA reform for a long time—

Angie Warren-Clark: But done nothing about it besides that.

SAM UFFINDELL: We do note—we tried; we didn’t have the numbers. We will note that, during that period, Labour did oppose a lot of minor and sensible amendments, like removing the requirement to get a resource consent to chop down a tree on one’s property. I have a tree that will have to come down on my property soon. If my wife is watching this—

Hon David Bennett: Chop it down.

SAM UFFINDELL: —she’ll know what I’m talking about. Benno’s saying, “Just chop it down.” I will do the right thing.

But after five years of attempting to make reforms, we get to where we are now with this Spatial Planning Bill. We look at what is required here, and we do note there is a positive in the formation of the National Planning Framework. We do note that the RMA did result in quite a few policy silos. But when we look at what will be created in the regional planning committees—and it’s been touched on quite a lot today, how that is going to create issues. It’s not necessarily a democratic process. There have been concerns raised about it being a co-governance-by-stealth arrangement. I’m not necessarily saying that it is, but it could definitely give rise to those concerns. These people that will be on this are not democratically elected, and they will have the ability to say that this area of land has to be used for this. That is a 30-year call, and the reality is that things don’t always work out like that. This isn’t like SimCity where you can just plan what it is a long time in advance—

Angie Warren-Clark: Ha, ha!

SAM UFFINDELL: —there are a lot of—thanks for the laugh, Angie—different actors involved: businesses, individuals. They may be a new industry popping up in a certain area. There may be housing development that wants to occur there. The Government may have a different plan around where they want to build some major transport infrastructure. As my colleague Stuart Smith noted, there was an area around his patch where it was deemed that it wouldn’t be suitable for vineyards, and they were certainly proved wrong on that front. I think there is a lot of flexibility and choice that is removed, and we end up in a situation where each committee’s secretariat—gee, that sounds communist—will be dictating, effectively, what people can build.

I think we’ve got a real opportunity here to do something good in this space. We all acknowledge that we aren’t where we need to be. There does need to be more consideration. There probably needs to be a little bit less ideology on the side of the Government and more consultation with all of the stakeholders involved. This needs to be an enduring process. It’s no good that this goes through under this Government and whenever a National Government comes in, it gets removed or replaced, and we’re back to square one. So like the rest of my colleagues, I oppose this bill. Thank you.

ASSISTANT SPEAKER (Hon Jacqui Dean): Dr Duncan Webb—five minutes.

Dr DUNCAN WEBB (Labour—Christchurch Central): Thank you, Madam Speaker. It’s a real pleasure to stand up and talk just a little bit about this bill, the Spatial Planning Bill. It always comes as a surprise to me when the National Party stand up and have done nothing in this area in their entire time of Government, whilst Minister Parker has worked tirelessly to overhaul this entire system and now has a comprehensive package of reforms to bring to this House. And what do they say? “No. It’s no good. It’s not right.” Well, it is right, and one of the things that this bill does, which is really important, is take a long-term approach—30 years and beyond—because we know that the short-sightedness of what goes on in planning now has caused us real problems.

Certainly, in terms of regional planning—and I heard Stuart Smith get up and talk about Hurunui and the wider Canterbury area, and say that we had nothing in common with each of the relative districts. Well, Canterbury is actually a really good example of where there are some massive gains that could be made in things like residential and urban planning, transport networks, transport corridors for industrial developments, and so on, but because we have a number of local councils, they’re competing against each other. There’s a race to the bottom for rates. They’re not investing in infrastructure. What we need is good, thoughtful, long-term regional planning, and that’s what we’ve got going on here. This is absolutely the cure for a system which is clearly broken. We need to overhaul our system, which is expensive and time-consuming.

It came as a huge surprise to me to hear the ACT Party dissing this bill when what we’ve got now is a brake on the kind of enterprise that they pretend to be champions of, but we actually want wise, well-planned, and profitable development that is good for the whole community. This is the way towards it, not by some strange process that they’ll cook up—the cauldron is going to be opened on Tuesday morning by all reports! The work is being done. We know that the business case around this material has shown that this will have real and substantial economic benefits. So I think that, in terms of a framework to restore and protect the environment from further degradation, this is absolutely what we need, to recognise that development in the right place is right and to be encouraged, but within our biophysical limits—that we can’t continually chip away at our environment.

And, as for those on the other side of the House who say Te Oranga o te Taiao is some kind of strange thing that no one can understand, it’s pretty simple. An underlying principle that the health of our environment is a bottom line isn’t hard to understand, and if you struggle with the concept that we should put the health of the environment front and centre when we make environmental decisions, you have got a real problem—

ASSISTANT SPEAKER (Hon Jacqui Dean): Order! Don’t bring the Speaker into the debate.

Dr DUNCAN WEBB: Sorry, Madam Speaker. This is a very good piece of legislation, which puts the environment front and centre, which thereby will enhance and encourage development and will do it in a more cost-effective way that’s better for all New Zealanders. This is a great bill. I commend it to the House.

LEMAUGA LYDIA SOSENE (Labour): Thank you for the opportunity to take a call on the Spatial Planning Bill, first reading. Alongside the Natural and Built Environment Bill, this legislation is much needed. The Spatial Planning Bill is the template for the next 30 years. It highlights the environmental outcomes that need to be achieved because we are under the climate change changes, not just in land use but also around our environment.

The information requirements are really important—that the plan provides better infrastructure. I’ve come from Auckland Council for over a decade, where spatial planning was really important for communities such as Māngere in South Auckland. The benefit of having a spatial plan is to see what we currently have by way of environment, by way of housing, by way of business centres, medical, churches, communities, that all are in the mix. What the Spatial Planning Bill provides is coordination of the template—the better infrastructure which is missing in communities such as in South Auckland.

I just want to highlight that the bill is a huge step forward for Aotearoa. Despite what colleagues on the other side say who probably have not had the experience, I can tell you that the coordination and the review of the spatial planning—the integration—is very helpful, particularly for rangatahi and young people who want to be involved in terms of climate change outcomes for their community. They want to have better education.

In terms of infrastructure, many of the communities in South Auckland face a number of challenges when it comes to spatial planning because of housing typology that may not necessarily be available for them. However, what they do—and, certainly, my lived experience is that they get involved when there is public engagement through the tools such as Auckland Council elected members by way of local boards. So public engagement has been critical to the success of the smaller spatial plans under Auckland Council. Part of that is our kōrero with iwi and with mana whenua. Part of the public engagement that I have been a part of is to actually recognise and to understand the values of tikanga, particularly around wairua and whenua, and the reason why we as a community—and it’s not just iwi rangatahi; it’s also Pasifika and ethnic communities. I can only speak of my experience with Auckland Council.

The regional spatial strategy is really important because it provides innovative tools. This Government has provided funding for businesses, post-COVID, and one of the things that has been highlighted recently is how young people carry out their business within five days. So two of those days they’ll be studying, two of those days of the week they are entrepreneurs, and the last day they’ll be working on Uber. The environment for businesses and entrepreneurs, particularly in big centres, is changing. The Spatial Planning Bill will help with the integration, particularly when Kāinga Ora are building houses. In Māngere, over 10,000 dwellings are being provided for the communities as such, and land use and whenua is really, really important, but we are seeing the building going upwards.

So infrastructure is very important, and I’ve given you the example. In a post-COVID environment there are those challenges. However, what is very important to communities is things such as transport infrastructure, housing typology, playgrounds, good parks, and even the life of the local streams. So public housing that has been provided in various areas around the motu, the environment to understand the environment—lots of our rangatahi and our tamariki in the respective communities want to be involved, but in order for them to be involved and in order for them to be engaged in things such as spatial planning that is currently being carried out by the likes of Auckland Council, they want to know where they can plant trees, they want to know how they can watch that tree grow, and what affect and impact tree planting has in a community.

So, just in closing, I want to highlight that the priority of this Spatial Planning Bill is very important for big communities around the motu that they can become involved. I commend this bill to the House.

Hon DAVID BENNETT (National): Thank you, Madam Speaker. Any council worth its salt will be very much against this bill. What is the point of having a district council in New Zealand now? This bill puts everything to regional councils around spatial planning. They’ve taken away three waters from the local councils—taken away water—now they’re taking away planning. Planning will now be done at a regional level. What’s the point of having a council? Are they going to be doing parks, pools, and playgrounds? That’s all they’re going to have. That’s all the council will have left to do. It won’t be doing planning of housing, it won’t be doing planning of infrastructure, and it won’t be doing its water resources. They’ve taken away one-third in the three waters; they’re taking away basically another two-thirds now. They’re leaving them with bugger all. Every council should be standing up against this bill, because it takes away the ability to have independence in commercial decision-making.

Now, my colleague Stuart Smith made a very good point before when he talked about Marlborough and how nobody thought it was actually going to be the great capital it was, until somebody actually put that investment in there. Well, I want to give you another example, and that is Tauranga port. There was a decision made around the ports for New Zealand 30 years ago, and guess where Tauranga port was in that decision! At the bottom. Nobody foresaw that Tauranga port would be the primary port for New Zealand. Thirty years ago—that’s what they’re talking about. A 30-years-ago decision by some Minister, that could be a Green or Labour Minister that’s against any commercial sensibility in their bones, could decide that Tauranga port should get no investment for 30 years and that we all go and put it into Timaru port or we all go put it into Northport or we all go put it into Auckland port, because that’s what New Zealand decided 30 years ago in its port strategy. Nobody foresaw Tauranga, and look what happens now: Tauranga’s the only commercial port in New Zealand. It owns one or two other ports throughout New Zealand, and it is the gateway for New Zealand produce. Tauranga City has boomed as a result. If we had central government planning, that would not happen.

I want to give you the tale of two towns, and this is very dear to me because this is in the Waikato. So we’ve got Cambridge and Te Awamutu. Te Awamutu actually had a four-lane road from Hamilton to Te Awamutu, and that came out of the 1980s and that was there, and National built that, actually. And then what happened was Waikato District Council decided it was going to allow subdivision of land, and it allowed 5- and 10-hectare plots of land to be subdivided. Take that 10 years forward, you had Tamahere/Mātangi. Then they opened that up to 1 or 2 hectares. Tamahere/Mātangi became some of the most valuable land in the country; the most valuable houses in the Waikato are there, and it meant that Cambridge and Hamilton were linked. Cambridge is now double the population in the future of Te Awamutu. Cambridge will be a city soon, and because that subdivision happened on one side of the Waipā boundary where Waikato was, Cambridge boomed. On the other side of the Waipā boundary, where there was no subdivision, Te Awamutu did not boom, and Te Awamutu had the infrastructure in the first place. That shows central government planning—in this case, regional planning—can fail. The success is actually through the market.

If we look at this plan, Sleepyhead would not be going to Ōhinewai. Now, I can name you Ministers here that have gone to that actual proposal and said, “What a great thing it is for the Waikato, seeing the Northern Corridor growing.” Sleepyhead would not happen under the regional plan, because the regional council actually opposed Sleepyhead. It opposed the development there. It said it shouldn’t happen, and under the plan that these Ministers are putting forward, that would not happen, but they’re very happy to go out there in election year and say, “Look at this 2,000-house development, major industrial development north of Hamilton. Isn’t it great to see?” Well, it would not happen under this plan, because the regions would have power, and the regions would make the wrong decisions.

If you look at Hamilton, for example, the great city it is, it actually needs Waikato and Waipā and Cambridge to actually be competing against it opening up land. If it didn’t open up land in those other two places, Hamilton would not be forced to open up land and we would not have the growth we’ve had. Competition has actually delivered more in the Waikato than any spatial planning will ever do. We’ve got this thing called Future Proof that was set up to do exactly this. It’s a dog. Everybody knows it’s a dog. Councillors sit around, talk about it for days, have lovely cups of tea, sausage rolls, spend a lot of money, and do nothing. Nothing actually comes out of it. It’s when you’ve got businesses that invest like Sleepyhead that actually make things happen, and then they go buy the cups of tea and the sausage rolls so that those councillors can improve it. That’s basically what happens. That’s what will happen under this plan.

Now, I haven’t gone on to some of the other issues around the participation of different groups and that, but we will do that in the committee stage. But I would say this: the ACT Party was quite right in saying that infrastructure actually is a big part of growth, but they’re wrong in the sense of wanting communities to determine that. Business is a better determiner. Where we want to grow will come through infrastructure and business development. There is nothing wrong with New Zealand farmland being made into houses. There is nothing wrong with using our best land to build our best cities.

There is going to be a huge development between Hamilton, Tauranga, and Auckland in the next 30 years—that whole area will boom. There is nothing wrong with using that land for housing. And where are we going to house the people? They’re not going to Taumarunui and they’re not going to Invercargill—unfortunately, Penny. They are going to be between Hamilton, Auckland, and Tauranga. That is New Zealand’s best land, and there’s nothing wrong with having another million people in that area. That is the future of this country. The market will make that happen. The Government’s job is to provide the infrastructure for the market to allow that to happen.

Spatial planning will not allow that to happen. I can tell you what’s going to happen in spatial planning, because the Waikato Regional Council, which would be the ones making this plan, are dominated by some Hamilton councillors that traditionally have a left-wing view of the world. They don’t believe in growth; they don’t believe in that. They actually think that what we’ve got is enough, the world can’t get better. We can get better. We can grow. We need to grow. It is the success of this country, in growth. That’s what we need—not some councils determining the spatial planning, not some Minister determining the spatial planning, but the market determining our spatial planning based on the infrastructure that we have. Government’s job is to provide the infrastructure; it’s not to provide the decision making. And—

Anna Lorck: That’s what we’re doing, Mr Bennett.

Hon DAVID BENNETT: —no, it’s not—if we look at what they’re doing, they’re saying the Minister will determine through the regional spatial plans.

Any council out there should be damn scared of this bill. It basically takes away what they had left to do and takes it away now.

Hon Member: It doesn’t.

Hon DAVID BENNETT: The second thing—no, it does, because it’s only the regions that do it; it’s not the councils, and we need competition between councils. We need the Waipās and the Waikatos to fight it out. That’s how we get growth. That’s how we get what we need. We do not need central planning; we need a market delivery system that’s based on strong infrastructure that comes from our Governments of the day. That’s what we need to do.

Now, the Labour Party are getting very upset, because this is one of their babies that they thought there was going to be no problem around, and the backbenchers were told by the Ministers, “This’ll solve some of your issues.” The reality is, as people understand it more, they’ll come back to those backbenchers and say, “This is another dog you’re putting forward.” Do you really want to do that in an election year when you’re going to be under big pressure? No. We’ll get these Ministers to come back to the House and say, “This is getting a bit hard. We’ll have to just do a bit more work on it.”, but be aware, anybody in local government: this is what they intend to do to get rid of local government. Might as well amalgamate them all now. It’s all right in Auckland to say the spatial planning works on a regional scale. You might as well not have Waipā and Waikato District Councils. What’s the point of them? They’re gone.

ASSISTANT SPEAKER (Hon Jacqui Dean): The member’s time has expired.

Angie Warren-Clark: And thank goodness for that. Madam Speaker—

ASSISTANT SPEAKER (Hon Jacqui Dean): Order! Order! If the member wishes to take a call, she will make a call to the Speaker. I don’t need any extra comments, thank you.

ANGIE WARREN-CLARK (Labour): Thank you. I’m delighted to take a call on a bill that I’ve actually read. That member who has just taken his seat, the Hon David Bennett, obviously hadn’t, and did I hear him say that he’s happy for productive lands to be used to build houses on? I thought that that was one of the things that the National Party were attacking Labour about, and so I’m really surprised that a million-plus people can go into that community of Hamilton. I’m quite surprised, actually, about that whole speech. But, like I say, I don’t think the member has read the bill.

Now, let’s go on to the bill. The bill, I really do have to say—having come from Tauranga Moana, where we do have a really interesting model in our community—will, essentially, provide some great planning and a system in place to ensure some strategic planning. Basically, what has happened in my city is that we have had growth which has not been planned well. Tauranga Moana—we are suffering from a lack of infrastructure that fails to support us to grow appropriately. We have two-lane bridges in the middle of cities. If there’s an accident, our city is closed off. We have a situation where we have much more expensive land outside of the city—which is for kiwifruit, etc.—which is meaning that we don’t have land to be able to use.

We have SmartGrowth, and they have done some extraordinary work, but it’s all retrospective: it’s all about what we needed to have 20-plus years ago. Now, this bill, the Spatial Planning Bill, will actually enable us to get ahead of these issues that are coming. It will actually support us to be able to think about where we need a school, where we need a hospital. I’m sorry, but the market is not going to deliver that for us. I’m sorry about that fact, but, actually, it won’t. We need to manage, to insure, and to plan, and we need to do this. A 30-year window is the kind of window that we need. I’m thinking about my children and my grandchildren, and I’m thinking about the kind of liveable city that I’m in currently, in Tauranga Moana; the issues that are happening for us currently, and what will happen going forward if we fail to plan, going forward.

My city is a coastal city. We know climate change is coming; we know something is going to really alter in our city. We know, with climate change, there are going to be some changes in the crops that we can grow, and we’re a kiwifruit country. Kiwifruit country could be at risk. This Spatial Planning Bill enables us to get ahead of these big issues. I think the really important thing that the members from across the aisle haven’t taken into account is, absolutely, this is complex stuff, but it needs to happen, and we don’t resile from that. We don’t stand back and say, “Oh, too hard; we’ll not do anything.” That sounds very much like the National Party’s response to the Resource Management Act. We’re actually getting in, we’re putting this in place, and we’re going to give it a damned good go.

Now, the thing that is important to recall, as well, is that there is a review period that is built into this bill. It’s about looking and seeing if these plans have been successful and reviewing them. I think that that’s very important and very sensible. It means that, sure, if something remarkably different happens, there can be a review period, and that seems very sensible to me.

Finally, I would like to just address the fact that, with the select committee, we are absolutely going to be working across two pieces of legislation that are interrelated. So this is a plea to the public out there: we want to hear on both pieces of legislation. We’re very interested to know both pieces of legislation, and your views and values. But also, when we are managing this process—and the two will be running together—we’d like to ask and ensure that the public put together a submission so we can easily tell which piece of legislation you’re referring to. I think that that’s absolutely critical for us so that, when we hear from the community and the public, we actually are really clear when we do our pre-reading what we’re actually going to be talking about.

And, finally, I would just like to acknowledge the select committee who, even though and despite the fact that the Opposition and the ACT Party are not agreeing to support this bill, will work diligently, who will work together, because, despite the things that everyone has said here in this House, they know it’s important that we have to get this legislation right. We have to do the right thing for the environment. We have to do the right thing for people. With that, I commend this bill to the House.

A party vote was called for on the question, That the Spatial Planning Bill be now read a first time.

Ayes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 45

New Zealand National 33; ACT New Zealand 10; Te Paati Māori 2.

Motion agreed to.

Bill read a first time.

ASSISTANT SPEAKER (Hon Jacqui Dean): The question is, That the Spatial Planning Bill be considered by the Environment Committee.

Motion agreed to.

Bill referred to the Environment Committee.

Urgency

Urgency

Hon CHRIS HIPKINS (Leader of the House): I move, That urgency be accorded the committee stage of the Water Services Entities Bill; the passing through all stages of the Residential Tenancies (Healthy Homes Standards) Amendment Bill, the Land Transport (Clean Vehicles) Amendment Bill (No 2), the Social Security (Accommodation Supplement) Amendment Bill, and the COVID-19 Public Health Response (Extension of Act and Reduction of Powers) Amendment Bill; the passing through of the remaining stages of the Dairy Industry Restructuring (Fonterra Capital Restructuring) Amendment Bill, the Climate Change Response (Extension of Penalty Transition for Forestry Activities with Low Volume Emissions Liabilities) Amendment Bill, the Arms (Licence Holders’ Applications for New Licences) Amendment Bill, and the Companies (Levies) Amendment Bill; the first readings and referral to select committee of the Grocery Industry Competition Bill and the Fuel Industry Amendment Bill; the introduction, first readings, and referral to select committee of the Crown Minerals Amendment Bill and the Local Government Official Information and Meetings Amendment Bill; the first reading and referral to select committee of the Legal Services Amendment Bill; the introduction, first reading, and referral to select committee of the Accident Compensation (Access Reporting and Other Matters) Amendment Bill; the first reading and referral to select committee of the Health and Safety at Work (Health and Safety Representatives and Committees) Amendment Bill; the third readings of the Security Information in Proceedings Bill, the Security Information in Proceedings (Repeals and Amendments) Bill, the Māori Purposes Bill, the Remuneration Authority Legislation Bill, and the Statutes Amendment Bill; and the passing through of the remaining stages of the Organic Products and Production Bill, the Natural Hazards Insurance Bill, the Digital Identity Services Trust Framework Bill, and the Civil Aviation Bill.

The passing of the Queen in September meant that Parliament lost a week of parliamentary sitting time and the granting of this urgency motion will allow some of that time to be made up.

There are a number of bills that address issues that do need rapid attention of the House. An example is the Social Security (Accommodation Supplement) Amendment Bill, which will ensure no disruption or change to the accommodation supplement benefit individuals currently receive. Both the Dairy Industry Restructuring (Fonterra Capital Restructuring) Amendment Bill and the Climate Change Response (Extension of Penalty Transition for Forestry Activities with Low Volume Emissions Liabilities) Amendment Bill must be enacted by the end of the year. Seven first readings are including in the motion. Without them, it would not be possible to get these bills off to select committee before Christmas, and some of them, including the Grocery Industry Competition Bill, we do expect will attract a large number of submitters. Other bills will have a significant impact in their own areas and they would have considerable delay coming into effect were we not to use urgency in order to progress them further.

So I thank the House in advance for what could be a lengthy sitting and thank all of the parliamentary staff for the support they will provide us in the coming days.

A party vote was called for on the question, That urgency be accorded.

Ayes 64

New Zealand Labour 64.

Noes 55

New Zealand National 33; Green Party of Aotearoa New Zealand 10; ACT New Zealand 10; Te Paati Māori 2.

Motion agreed to.

ASSISTANT SPEAKER (Hon Jacqui Dean): I declare the House in committee for consideration of the Water Services Entities Bill.

Bills

Water Services Entities Bill

In Committee

Part 1 Preliminary Provisions

CHAIRPERSON (Greg O’Connor): Members, the House is in committee on the Water Services Entities Bill. Members, we start with Part 1, which is the debate on clauses 3 to 9A and Schedule 1, “Preliminary provisions”. The question is that Part 1 stand part.

Hon NANAIA MAHUTA (Minister of Local Government): It gives me great pleasure to be able to speak on Part 1 of the Water Services Entities Bill. It’s really important to ensure that, from the outset, we continue to highlight that there is need for reform in our current water services delivery approach.

Why? Because in 2016, when the campylobacter outbreak occurred in Havelock North, an inquiry was commenced by the previous Government. Why? Because the findings of that particular inquiry demonstrated that that particular incidence was one that caused a significant contamination and led to further serious highlighting of the water network infrastructure system that was not isolated to Havelock North, and then we commenced a significant investigation in 2017 around just how fragile our water infrastructure network is.

As I come back to Part 1, what we have is the initial architecture of an approach which will enable us to address these very significant issues. In fact, in the purpose clause—and I want to thank the Finance and Expenditure Committee for the work that they have undertaken—the clarification of the bill is set out in clauses 3(1) and 3(2) in terms of the purpose of the Act.

I want to really ensure that we do not lose sight that this approach means that we will have a sustainable way of funding waters infrastructure; that we will be able to separate balance sheets, in terms of water services entities and councils; that we will be able to implement a good governance regime; that we will be able to uphold Treaty of Waitangi obligations; and that we will be able to ensure greater affordability for ratepayers at a time when the cost of living pressures are significant and great.

In Part 1 of the bill, what we will see is a Supplementary Order Paper (SOP) which makes clear Te Mana o te Wai clarifications. When I look to the work of the select committee, it was actually the Federated Farmers, in their submission, who highlighted that they wanted greater clarification of Te Mana o te Wai and its meaning, which is set out in SOP 306.

What have we done here? We’ve actually brought forward the intent of Te Mana o te Wai as was defined in 2014, under Nick Smith, and said, “Well, we need to treat water as a whole system, right from source protection to discharging back into the environment.” So in the SOP, under clause 6, we’ve got “Te Mana o te Wai—(a) has the meaning set out in the National Policy Statement for Freshwater Management issued in 2020 under section 52 of the Resource Management Act 1991 and any statement issued under that section that amends or replaces the 2020 statement (and see also sections 4, 5, and 13 of this Act); and (b) applies, for the purposes of this Act, to water (as that term is defined in section 2(1) of the Resource Management Act 1991).”

Simply put, it enables us to ensure that, from the point of source and extraction of water for drinking water, right back through the taps, and discharging water through waste water or sewerage into its receiving environment to any water body, we are taking care of the whole system in the application of this particular Act.

I’m anticipating that there will be a number of contributions that may well question two particular intents in Part 1 of the bill, and that’s as it relates to the Treaty of Waitangi and Te Mana o te Wai. If I look to clause 4, it’s very clear that this particular bill will give effect to the principles of the Treaty of Waitangi and Te Mana o te Wai. They have the dual purpose; they ensure that we’re able to be responsible stewards and kaitiaki of our water resource by catchment, going forward into the future.

This is what will separate New Zealand’s approach to caring for our most precious resource—water—in the way that we deliver services to our community. We’re not just thinking about today; we are thinking about tomorrow. We’re making sure that the whole system of care for water and its use will be taken account of.

I do want to thank the select committee for the range of additions that they’ve made to Part 1. I look forward to the debate.

SIMON WATTS (National—North Shore): Thank you very much, Mr Chair, and I want to acknowledge the Minister—I am looking forward to a continuous period of debate through what is a significant bill; six parts, and obviously we’re looking at Part 1 first up. But I just wanted to go back through some of the Minister’s opening statements in regards to this part, and the concept right at the start that the Minister articulated around the need for reform. I want to make it crystal clear to everyone out there—and all those sitting buckled in on the couch at home with a bit of popcorn ready to go through this committee stage over the next day or so—that the National Party absolutely believe that reform is required in the water services space. The point where we disagree with the Government is the mechanism in terms of how we undertake that change, and I think sometimes that point quite simply has been lost—or potentially used against, to say that we aren’t supportive of reform; we absolutely are, and I think through this process and through the conversation we have at the committee stage, we’ll get into some of that detail in regards to questions around alternative models and other aspects.

I think the Minister also outlined, in her opening statements, the catalyst for this conversation, and I acknowledge that members of the National Party were engaged as part of those conversations following the events that occurred in Havelock North—and I think we all acknowledge that and the impact that that had on that community and the broader community. But the reality is, that event, while absolutely tragic, and the causes etc. have been well traversed—it doesn’t reflect the fact that the entire system in New Zealand is broken. I think this is a point at which, when we look at the broader conversation around this reform agenda, we acknowledge that there are areas that do need improvement; we would join with that, but we don’t believe fundamentally that the entire system is broken. I think that concept as well, we will traverse as we go through this conversation.

The Minister outlined the “Purpose” clause, clause 3, and we’ve got a number of Supplementary Order Papers on the Table there and we’ll work our way through those over the period as well, including one at clause 3. But the other aspects that the Minister talked about noted around sustainable funding balance sheets, the governance model and, actually, the fact that the Water Services Entities Bill is, in effect, some form of solution to the cost of living crisis, or dealing with the underpinning of that. I’ll say right from the outset that we don’t support that premise, and we don’t support—and haven’t been able to substantiate in detail—those statements either. So we can get into that a little bit later on.

The Minister has also outlined the terms of the Supplementary Order Paper that she’s put on to the Table—and we’ll work through elements of that as we go through. So let’s get into Part 1 and particularly around the purpose clause at clause 3, which is the first clause in the Act. And the questions that I have for the Minister are as follows—and I think the purpose of this bill has been the conversation that the select committee process has traversed right from the start, in terms of what is the problem that we’re trying to fix, and do we have confidence that this legislation on the Table will deal to and find solutions to that problem? I think that’s been, right from the outset, the aspect which we’ve been unable to substantiate. And that’s why National have been consistent throughout this process that we do oppose this bill.

But in regards to clause 3, around the purpose of the bill, I’ve got a Supplementary Order Paper on the Table, Supplementary Order Paper 304, which, basically, inserts a new clause, 3AA, on page 12 above line 20. And quite simply, this Supplementary Order Paper amendment basically amends the Act in order that this Act is repealed on the day after the date of Royal assent, and some may say “Well, that seems a little bit extreme”, but the reality is that throughout the select committee process, it was crystal clear that there is significant opposition to this reform across this country. There is significant opposition in terms of the bill that is on the Table and lack of confidence that that will solve the problem, and alternative models that have been tabled that believe that there is a better pathway here in order to deal with the problem—

CHAIRPERSON (Greg O’Connor): Just a reminder to the member, we’re still in a general debate speech—specifically now to the part, please.

SIMON WATTS: No, no, that’s all right—so the amendment that I’ve got on the Table under 3AA is a repeal of that legislation, and it is our belief that if we put that through, then we can take this back to a position where we can actually listen to the other amended alternative models that are on the Table and we’ll continue on through there.

The second aspect I want to raise is in regards to clause 4, and we’ll get into this in a little bit of detail as well—particularly around the Te Mana o Te Wai statements. There’s been a lot of conversation, and I think rightly so—questions around that aspect of the bill, and, in particular, in regards to clause 4(4), the addition by the committee around coastal and geothermal waters.

And don’t forget that this bill, at the outset, has been referred to in the public domain as three waters. But, in effect, the changes that have been made in regards to clause 4 make this legislation—you know, you could call it five waters. That opens up a significant element of other issues and complications, and we have some significant concerns around the implication in regards to what clause 4 has been modified around. So I’m also interested to hear from the Minister in regards to the rationale in terms of the addition of those two other elements: the reality around the unintended consequences of inclusion of both coastal and geothermal waters as part of this broader legislation. Why was it put in at such a late stage in the conversation, without any ability, really, for people to be able to make submissions in regards to that? And I think that’s important because of the fact that that change in clause 4 was not there when we had the 88,327 or so submissions, and so therefore it has subsequently raised significant public interest, and I think it is reasonable that the Minister articulates why and the rationale for the inclusion of those aspects.

The other point around that—and we can get into that in some future calls—is in regards to the actual implication around differentiation between coastal and, in effect, the freshwater mechanisms that come through from streams and rivers that go out to sea. I think there’s been quite a few questions out there in the public domain in terms of where do you draw the line around that, and what are the implications around those statements, which we’ll get into in future elements—around who has the ability to input into the drafting of those. So I’ll leave it at that at this stage, and look forward to the Minister’s contribution.

Hon NANAIA MAHUTA (Minister of Local Government): I’m pleased to take a call early on on this particular issue because, fundamentally, it cuts to the core of the benefit of the Te Mana o te Wai perspective in relation to water bodies. What we know from source protection of water in order to drink and to be able to transfer through the pipes and perhaps waste-water plants, and also in relation to stormwater, is that when water goes back to its receiving environment, it’s not good enough to treat two waters in isolation of what happens to water through its whole life cycle. In fact, water stakeholders admit this. They say when you think about the way in which we look after water, we have to think about the whole life cycle, which is why, when we bring forward the Te Mana o te Wai definition as it currently stands—it’s not a new definition as it currently stands—we need to think about water source protection: taking water for drinking or other purposes to its treatment and then back into its receiving environment, and that could be in coastal areas.

I’ll take an example from my local community. It’s been a longstanding concern that waste-water discharge into Raglan Harbour has been not good enough. And do you know what? We have far too many waste-water treatment plants operating under expired consents, and I know that the Finance and Expenditure Committee heard this, because it was information that officials offered up. And why that’s important then—when it comes to coastal water or geothermal water—is because when we think about Rotorua and when we think about Taupō, where there are pockets of thermal waters that bubble up into those lakes and where there are discharge pipes that go into the lake, we need to be assured that when we return water through our treatment plants back into these water bodies, we are doing no more harm to the environment. And that’s why Te Mana o te Wai approach will, in fact, improve the current state of the way in which we are thinking about the whole life cycle of water.

But let me come back to the primary question of the member Simon Watts: what is the problem we are trying to fix? Core to the premise of water reform, we know that councils are constrained in the way that they currently fund water infrastructure. There is always an offset and a trade-off that councils are making between what’s above the ground and what’s below the ground, and it is becoming unsustainable and, sadly, unaffordable for ratepayers. That is a problem we’re trying to fix, because there have been decades, if not decades upon decades, of under-investment in our water infrastructure system. So by separating the balance sheet and finding a financially sustainable way to fund infrastructure which does not create too much of a burden for councils or the Government, we are actually preparing communities now going forward into the future to be able to fund this necessary infrastructure that underpins our quality of life. And gosh knows we need it, because the modelling that the select committee heard—of which that member was a part of—showed us that through the councils’ long-term plans (LTP), aggregating their LTP numbers for 10 years, we’re going to need about $120 billion. But if you factor in things like greater resilience and the impact of natural weather events, that number then escalates to about $185 billion a year. This is unaffordable for councils as it currently stands—unaffordable.

So if we do not find a way to fix this challenge, we are dooming generations of current and future ratepayers to bear this cost, and it is far too great. That’s why we are coming up with a solution. It’s not simply good enough for that member to say that repealing the Act provides a solution. It might be politically expedient, but it does not provide communities who desperately need a solution with a way forward, and that’s why we won’t be voting for that particular Supplementary Order Paper by the member. We also need to ensure that when we talk about the importance of water, we’re actually acting in a way that is consistent with those types of statements.

And I’ve often heard the member speak on the three water system, and I really want to try and understand the merits of the views that he brings to this House, but when you hear criticisms rather than solutions, you will appreciate that it’s very difficult to try and see your way through as a responsible member of this House to try and understand what the alternative is. Right now, there’s nothing. That member is presenting no alternative to the House, but I still want to try and ensure that we, as a responsible Government looking for a solution, can appreciate some of the perspectives that he brings to the House. But repealing this Act with no solution is not a way forward. In fact, ignoring good evidence is not a way forward, so we won’t be supporting those amendments that he’s put up.

SIMON COURT (ACT): Thank you, Mr Chair. Minister, thank you for coming to the House tonight to present your case for this bill. You know that the ACT Party has opposed the foundation, the principles, of this bill because the ACT Party fundamentally disagrees with the approach taken by this Government when it comes to centralisation, when it comes to allocating rights to special interest groups, to hapū, iwi, and Māori based on who their grandparents were. We’ve raised concerns that are validated by the officials and advisers like Standard & Poor’s that the affordability, the financial model, balance sheet separation, none of the objectives that the Minister has set for this legislation to solve the issue of three waters funding, finance, and delivery, levelling up infrastructure across communities, catching up with the lack of maintenance, providing for new infrastructure in communities that need to grow—this bill does not deliver a regulatory framework to deliver those objectives. It creates a far more complicated environment for the provision of water infrastructure.

So, Minister, I have some specific questions for you. When it comes to Te Mana o te Wai, you refer often to the fact that Te Mana o te Wai is a concept that was developed under a previous National Government at a time when there was a National Minister for the Environment: Nick Smith.

It seems like, with the best of intentions, to express how all Kiwis feel about water, whether we’re fishers, kayakers like myself, if we want to play in the water, if we want our kids to swim in a river, or if we have a need for water for our businesses, whether that’s farming or primary production, like in Hawke’s Bay—where they absolutely depend on being able to get water from rivers and from aquifers to irrigate crops that sustains industry like, for example, fruit and vegetable canning, which employs hundreds of people in highly paid jobs that otherwise wouldn’t exist without having access to the water to grow the crops in the first place. When we’ve seen Te Mana o te Wai statements and those principles applied in resource management decision-making into water conservation orders for rivers like the Ngaruongo River—if I’ve got that pronunciation—

Hon Eugenie Sage: Ngaruroro.

SIMON COURT: —correct. Eugenie Sage might want to correct me on that.

Hon Eugenie Sage: Ngaruroro.

SIMON COURT: Ngaruroro River, which recently has been subject to a water conservation order which will restrict the amount of water available by about 40 percent, and that all comes from the primary producers, which means that there won’t be, during dry periods, crops that can be harvested that can go to the canning factory that can then end up on our supermarket shelves. The decision makers have cited time and again, “Te Mana o te Wai directs us to leave water in the river.”, and yet, if we think about the opportunity for places like Hawke’s Bay to continue to be the food bowl of New Zealand and somewhere from where we export food to the rest of the world—well, there can be water in the river. We could build dams and storage, we could build pipelines, and we could build networks so that there was always water available. The concern that ACT has is that with this focus exclusively on the health of the river at the expense of communities or farming families—people who produce food, fruit, vegetables, as well as livestock, sheep, beef, dairy—the needs of communities are not included.

When we look at the provisions of the bill, the bill states quite clearly that only iwi and hapū are able to provide Te Mana o te Wai statements, and that these water services entities must give effect to them. This bill ignores the needs of communities, ignores the needs of farmers and primary producers and all the people whose jobs depend on growing stuff, and for that reason alone, the ACT Party would object to this bill. It does not solve the issue that the Minister states needs to be solved, which is how do we ensure clean drinking water and that the environment that we operate in—[Bell rung] Mr Chair?

CHAIRPERSON (Greg O’Connor): Simon Court.

SIMON COURT: Thank you, Mr Chair. It doesn’t solve the issue of how to allocate water fairly, how to mitigate the risks of contaminants ending up in drinking-water supplies but also how to ensure that we actually can develop the regions—those places where we grow things—and our cities, our urban environments.

So what ACT proposes is an amendment to Te Mana o te Wai in clause 3, the purpose of the bill. We propose replacing Te Mana o te Wai with the words “regional water quality”, because every community would agree that water quality is the single measure of whether these reforms are successful. Terms like Te Mana o te Wai have an important meaning to a large group of people in our communities who came to the Finance and Expenditure Committee and said that that’s important to them. It describes their connection to their ancestors, which the rest of us don’t have.

But when we come down to brass tacks, what is this about? It’s about water quality for drinking water and then control over the water resource that we all need for farming, primary production, for industry, for manufacturing, and, of course, for drinking water, and that there must be enough water in the rivers, in the aquifers to sustain the environment. That’s why ACT proposes in our amendment to clause 3 to replace the term “Te Mana o te Wai” with “regional water quality”. We think that every member in this House would understand that approach.

Then I want to come to clause 4. We propose, in clause 4, to remove geothermal and coastal waters from consideration under this bill. Now, Minister, you’ve stated that, of course, geothermal waters come out of the ground in places like Rotorua and Taupō, even Northland. Hot Water Beach in Coromandel—geothermal waters come out of the ground. At Hot Water Beach in Coromandel, you can take a spade, you can take the kids, you dig a hole, and as long as you’re careful, you can dig a decent hole. It will fill up with hot water, but you had better test it before you hop in. It could be very hot; it could burn you.

Now, it doesn’t make any sense if we’re talking about three-waters infrastructure, Minister, to include geothermal waters in consideration of how we supply drinking water, how we manage waste-water discharges, and, potentially, stormwater in the urban environment, and, in those catchments, to include geothermal waters. When we consider coastal waters—well, look, every raindrop that falls on New Zealand, no matter which piece of infrastructure it passes through, ends up in the sea. So to think that a water infrastructure regulator is going to be able to manage that from the top of the mountain out to sea appears to be fanciful.

Then I want to come to clause 9A in Part 1, the interests that the Minister claims and that this bill purports to enshrine that iwi and hapū, or Māori, have in fresh water—in fact, in three-waters assets, because that’s what this bill is about. It’s about pump stations. It’s about concrete pipes. It’s about horrible things like trash screens on the inlet to the sewage-treatment plant, Minister.

I asked a question of the Minister Nanaia Mahuta as to what rights and interests do Māori have in three waters assets. The Minister’s response was: “None, beyond that of anyone else in our community.” I think that answer gives the lie to the proposed objectives of this reform. We know Minister Megan Woods, today in the House, announced funding for three-waters infrastructure to enable housing growth in places like Hamilton. We have the Infrastructure Funding and Financing Act, which will be the vehicle to deliver an upgrade to the Moa Point Wastewater Treatment Plant in Wellington when that’s approved.

Minister, I propose that there is no justification for the inclusion of co-governance and the provisions in this bill for iwi and hapū exclusively to give Te Mana o te Wai statements. So, Minister, I would like you to provide, if it’s at all possible, any justification you think there is for why you’ve allocated special rights and interests to a group of people because of who their grandparents were in the management of our three-waters assets—Minister.

Hon NANAIA MAHUTA (Minister of Local Government): Mr Chair, I’ll give the member the courtesy of a considered response. There were a number of issues that you did raise in your contribution. Firstly, it’s a little bit clearer to understand the position of ACT, unlike members on this side of the House. At least ACT’s been really clear. Fundamentally, they don’t like the premise of this approach to reform because at the heart of it is a public model of water service delivery where we do not support privatisation. I’ve heard the member in this House say many times what his particular position is, and there has been a privatisation element to it which this Government does not support.

Secondly, let me come to the issue that the member referred to in relation to written questions, when he asked, “What rights do Māori have in three water assets?” Māori themselves have said they are quite happy with councils continuing to own the water network, and that’s clearly set out in the bill. Councils will clearly continue to own their current interests in the water network, which is debt and liability, and that will sit alongside other councils within the make-up of their entity—and iwi do not want to have an interest in that. In fact, councils can retain that particular interest and that is why within the substance of the bill a shareholding interest for councils only will remain.

The other element to the question—because there were lots of legs to the question that the member asked—was it’s not clear what the regulatory environment is for water, and that’s because the regulatory aspects or features of the system do not sit within the Water Services Entities Bill. We established Taumata Arowai to set drinking water standards and the regulatory framework that will fall from that, and oversight over waste water and stormwater to ensure that features informing the regulatory environment could be better understood. Also, we made very clear, in so far as discharges back to receiving environments, that regional councils will retain the regulatory function for waste water and stormwater.

But let me then arrive at why we thought it was important to bring forward the definition of Te Mana o te Wai that was defined in 2014 with the interests of a range of stakeholders in mind, including the farming community. If we ensure that the concept and approach to looking after water from source protection to its full use—whether it be for drinking or irrigation or food production and things like that—and back to the way in which we return water back into the receiving environment, in fact, the Te Mana o te Wai definition makes absolute sense when we think about source protection and discharging back into the natural environment, albeit water bodies. And that is why we’re taking this approach forward.

The other thing is that, in so far as the concerns that the member raises around wellbeing, economic developments, utilisation of water beyond drinking water, I think the select committee fully considered all those aspects and clarified through the definition in the bill how that can be given account of.

The last thing I’ll come back to is I greatly do appreciate, although I am extending beyond Part 1, the fact that the Finance and Expenditure Committee really were at pains to ensure that in the definition aspects of the bill they went through and better clarified what was meant on a number of fronts. And I just, in a light touch, highlight, for example, the importance of further refining the waste-water network and giving definition there of what a water services infrastructure, water supply network means within the context of the legislation, even to the extent where there was greater clarification on definitions around the stormwater network and the green stormwater infrastructure. I appreciate the valuable additions in Part 1 of the bill to better clarify what we are talking about.

Now, this debate will go all over the show if we don’t come back to the core premise. Ultimately, we need to find a way to sustainably fund investment in water infrastructure to underpin regional growth, to enable local voice and prioritisation of how that happens for better drinking and environmental outcomes through a public model of service delivery. That’s what this bill is about.

JOSEPH MOONEY (National—Southland): Thank you very much, Mr Chair. Minister, thank you for engaging in the debate this evening. I am going to ask two different questions on Part 1. The first is on Te Mana o te Wai. Now, in the national policy statement on freshwater 2020, it spells out a hierarchy of obligations in terms of Te Mana o te Wai. The first is prioritising “the health and well-being of water”. The second is prioritising the health needs of people—and it specifically says, in brackets, “(such as drinking water)”. The third is “the ability of people and communities to provide for their social, economic, and cultural wellbeing”.

My question, Minister, is: how does this obligation of hierarchies, prioritising water above the drinking needs of people, reconcile with a proverb such as “He aha te mea nui o te ao? He tangata, he tangata, he tangata. / What is the most important thing in the world? The people, the people, the people.”? If the hierarchy of obligations sets the health of the water above the need for people to drink and above the need for people to make a living, how can that be reconciled? I would appreciate an explanation on that, because this Part 1 makes it very clear that all persons performing or exercising duties, functions, or powers under this Act must give effect to Te Mana o te Wai. It also says that all persons performing or exercising duties, functions, or powers under the Act must give effect to Te Mana o te Wai to the extent that Te Mana o te Wai applies to those duties, functions, or powers. Given that hierarchy of obligations, I think it’s really important to clarify what is meant by that.

The second is that all persons performing or exercising duties, functions, or powers under this Act must give effect to the principles of Te Tiriti o Waitangi, the Treaty of Waitangi, and I would ask if you could clarify what those principles are and why they have not been defined in the interpretation clause of this bill?

PENNY SIMMONDS (National—Invercargill): Thank you, Mr Chair. I refer to Part 1, clause 3, “Purpose”, and subclause (1) of that: “The purpose of this Act is to enable long-term, sustainable improvements in the safety, quality, resilience, accessibility, affordability, efficiency, and performance of (a) water services; and (b) water services infrastructure.” I’m very keen for the Minister to outline in absolute detail, with evidence and research, just how that enabling of much-improved affordability, accessibility, efficiency, and performance is going to occur.

If I refer back, this Water Services Entities Bill, colloquially known as three waters—and, in fact, now “five waters”—is the second in a series of this Government’s centralisation ideology; the first, of course, being the combining of the vocational education sector. There are many similarities here, and I’m very keen that the same mistakes are not repeated. We and the tertiary education sector were told by Minister Hipkins that the centralisation would bring about improvements in quality and accessibility and affordability and efficiencies and performance, and the sector, in many ways, feel they have been quite misled over that because, of course, the reforms have failed spectacularly. There are many similarities in the lead-up process of this centralisation, so the majority of submitters on this bill were opposed to the bill. It was the same with the combining of the polytech sector—

CHAIRPERSON (Greg O’Connor): We’ve had a good two minutes of general stuff. The bill, please, or the part of the bill, in particular.

PENNY SIMMONDS: Thank you, Mr Chair. So I suppose what I’m wanting to make sure is that mistakes are learnt from that so that Minister Mahuta, who I feel much more charitably towards, doesn’t find herself in the same mess that Minister Hipkins has found himself in. Also, that the due diligence process can be—and perhaps it was explained more in the select committee process, but I know there will be a lot of members of the public watching this who will want to know that a due diligence process has been worked through seriously, and—

CHAIRPERSON (Greg O’Connor): On Part 1, please.

PENNY SIMMONDS: Sorry, Mr Chair, I’m talking about the due diligence process for Part 1: the purpose, and enabling the accessibility, affordability, efficiency to be improved. So what I’m asking is for the Minister to give us, very clearly, the evidence and the research that shows that this bill will improve the long-term sustainability of all those matters stated in the purpose, clause 3(1)—the improvements in safety, quality, resilience, accessibility, affordability, efficiency, and performance—because it’s very easy to say those things. My reflection was that those same sort of things were said in the lead up to the centralisation of the polytechs, but, in fact, when we go back now, in hindsight, looking at the due diligence of that process, it was deficient, and those promises were actually misleading. Those things have not occurred.

This, of course, is a much bigger concept, a much costlier concept, and so I believe that the general public have a very vested interest in knowing what the research, what the evidence has been. I’ve heard the same things from my local authority, that the financial modelling has been fundamentally flawed in this, just as it was in the centralisation of polytechs. So is that the basis of what is being relied on? I believe the public and this House deserve to be told that.

MARK CAMERON (ACT): Thank you, Mr Chair, for the opportunity to ask the Minister a few questions about green stormwater infrastructure. I imagine there’s quite a lot of rural interest in this. Actually, there’s certainly a lot of interest that I have heard. Can you please—and this is in Part 1, clause 6 “Interpretation”—define for the committee tonight what you deem “green stormwater infrastructure”? Because I know anyone worth their salt will be looking at this as it’s written here in the legislation, saying “Well, that could be anywhere.” It could be anywhere in rural New Zealand that happens to capture fresh water and by virtue ends up in any canal, river, stream, lake, dam—you name it—and invariably in the sea. So, Minister, this has the potentiality to erode private property rights—and private property rights are tantamount to all things ACT. Can you please, for the love nor money of it, explain to this House what green stormwater infrastructure will mean?

Does the Minister have a mapped understanding of the tens of thousands of canals, creeks, local drainage board catchments, and the provisions that are made at a local level and the asset management of these—and separate this out from the legislation and give some pause and clarity to what that will mean to the average farmer anywhere in New Zealand? Where will governance go, where will the funding models go, and how will this affect private property rights, if at all, Minister?

Hon EUGENIE SAGE (Green): Tēnā koe, Mr Chair. Thank you very much—patience helps. Can I acknowledge the Minister and the detailed and comprehensive engagement with the bill as developed and with the House tonight.

The Green Party recognises that Government has a mandate for this legislation, and it has the majority to pass it through. Our position has been one of constructive engagement, seeking changes through the select committee, and then tabling some Supplementary Order Papers to seek some further changes.

One of those—and it relates to Part 1 “Preliminary provisions”, clause 6 “Interpretation”—is around stormwater. I would encourage the previous speaker, Mr Cameron, to visit Ōtautahi Christchurch, because the city council has implemented green stormwater infrastructure to a very large degree.

Christchurch is built on a floodplain. It’s got a high water table in some areas, it’s got the Pacific Ocean on one side, the Waimakariri River to the north. It has had some significant floods in the past, and so the drainage board that was established in the early colonial days very much had a focus on efficient carrying away of stormwater. That was the council’s focus.

But over recent decades, about the last 20 to 30 years, it’s focused much more on recognising other values—ecology, landscape, public recreation, heritage, culture, places of mahinga kai—not just drainage. So we now see the Christchurch City Council having the largest native planting in the city, with 100,000 plants going into the ground, as part of the Eastman and Sutherlands stormwater retention basins and wetlands. They cover 80 hectares. It recognises that in the upper Heathcote it’s a major area for subdivision and growth.

The Greens’ concern is that councils like Ōtautahi Christchurch strongly called, as did Auckland, for stormwater to remain with councils because of that connection to place-making, to providing other recreational assets and facilities in new areas for development.

These big stormwater natural wetlands green stormwater infrastructure have been phenomenally successful in Ōtautahi in preventing flooding in the Ōpāwaho/Heathcote River—which was frequent—and so my questions to the Minister are: why would a water service entity which is wanting to ensure that its charges are low invest the millions that the city council has spent in providing for stormwater infrastructure that provides for other values and not just the efficient drainage and carriage of stormwater?

How can the bill guarantee that water services entities will have that much broader vision? What weight will be given to council views if the councils want to retain areas like Eastman and Sutherlands Basin, rather than have them transferred to the water service entities, given that those wetland areas have got kilometres of walking tracks, cycling tracks, they’re heavily used by local people as recreational areas and they are not just for the carrying away of stormwater?

What mechanisms—because the select committee did consider quite carefully the definition of stormwater, we added in the green stormwater infrastructure—will provide the certainty that we’ll have the same breadth of values being implemented in stormwater management, as has happened with councils?

Given that there has not been a strong case established in the regulatory impact statement that stormwater should be transferred, why is the Government so committed to proceeding with it when the entities will have more than enough to do, dealing just with waste water and drinking water?

Hon NANAIA MAHUTA (Minister of Local Government): Let me come to the new issues that have emerged in the House before responding to the other questions. In relation to green stormwater infrastructure, what we know is that within urban areas, land and infrastructure can deliver multiple outcomes and services for three waters: the transport system, the recreation amenity values, and for the environment, are all but some examples. These approaches have been identified as mixed assets within the context of waters infrastructure. If the function of a mixed-use asset for infrastructure or land has stormwater as a predominant use, then it would transfer to the water services entity—that came up as a question in the House last week and I clarified that. If the predominant use of an asset or infrastructure is not stormwater, such as a park or recreational reserve, for example, then that asset will not transfer and it will remain with the council. I think it’s an important clarification within the context of the two last contributions that have been made.

However, where stormwater is not the predominant use of an asset or infrastructure, or land is critical to the function of the stormwater system, then the proposed water service entity and territorial authority or transport corridor manager—for example, New Zealand Transport Agency—must establish an agreement to manage the interface between any stormwater function and other predominant function of that asset, infrastructure, or land. That’s going to be an important element of how to bring these things together, and those relevant parties who continue to manage that infrastructure.

So where a stormwater network infrastructure transfers to a water service entity, the expectation is that existing and future public access will continue. And that goes to the point that has often been raised by that member of the House in relation to green water infrastructure—unless there’s a specific health and safety risk.

I also want to make clear, through my Supplementary Order Paper (SOP) that’s been tabled in the House, that the clarification of predominant use in relation to stormwater is included. That has been on the basis of our stormwater technical working group advice and the way that they considered these mixed-use assets.

Let me come to the SOP that Eugenie Sage has tabled in the House—that’s SOP 307. I’m inclined to support the premise of that particular SOP, because it will require water service entities to consider if there are green solutions to infrastructure problems, which is the whole scenario that the member has raised, and I welcome that contribution because we know that there are some councils who have innovated their response to ensure that when it comes to stormwater it doesn’t necessarily have to be swales and pipes under the ground. We can make better use of the land and the environs within a particular context. It’s a helpful change that the member has put forward in her SOP, and shifts the emphasis—particularly in the area of stormwater infrastructure—to the way the broader catchment works. So it’s complementary to the way in which the natural environs are. Solutions like this have become industry standard in many areas as green solutions. Again, as the member has pointed out, rather than pipes we can look to green solutions, as I’ve already said.

Water-sensitive design is the future for good urban design planning and placemaking, and that’s what this Government wants to see where it makes sense. It can happen in urban areas and provincial areas alike, and, certainly, in small rural communities it can make a critical difference to quality of life outcomes. So I welcome the member’s questions in that regard.

Can I just come to then the question around Te Mana o te Wai and the hierarchy of needs that the member had asked about. The reason why there is a hierarchy of needs—which roughly go water, people, then communities—is that if we want the sustainable and efficient use of water we have to make sure that we are not taking more than we need.

We have to make sure that the ecosystem is looked after. In order to protect the ecosystem then there must be at least a minimum ecological use range that we recognise before we start taking water for drinking, for irrigation, for horticultural purposes, for growth and development. If we do not do that, then our sacred and precious resource of water will dissipate very quickly.

Water security will be an issue for us because of climate change. That’s why we recognise the hierarchy of needs within Te Mana o Te Wai. Can I just go—[Bell rings]

CHAIRPERSON (Greg O’Connor): The honourable Minister.

Hon NANAIA MAHUTA: Thank you. Thank you for your indulgence.

At the heart of Te Mana o Te Wai—and I will be at pains to reaffirm and affirm and restate and state—is the sustainable use of our water resource, not just for Māori but for everybody. But that concept that water is an interconnected system and must be treated as such, as a sacred and precious resource for this generation and the next generation, is a welcome addition to the way that we think about water. When we consider the position of water: that nobody owns it, we all own it, then we need to look after it. When we consider that our kids and their kids rely on us to make good intergenerational decisions, then adopting Te Mana o Te Wai into the way that we’re thinking about water service delivery is a welcome addition to the current state.

Let me come to the point that the member raises in relation to centralisation—not all centralisation is bad. When it comes to water service delivery we have 67 councils currently delivering water, and we need to think about some of the general inefficiencies that fall from that. We can’t go in to really strong procurement pipelines in a significant area of infrastructure in a way that we can get greater advantage. That’s why, at the heart of this model, scale and aggregation delivers us a set of solutions where we aggregate and leverage the benefit of scale. That’s where small communities will actually be the greatest benefactors. That’s where, in this instance, the model that we’re proposing in terms of aggregation and the benefits of scale will ensure that the cost impost on ratepayers lessens over time—lessens over time. The biggest benefactors of this approach will be those in our small communities or those communities who are ageing out, where you have got people on fixed incomes living in small communities, who won’t be able to afford to pay for the range of services that they so desperately deserve but cannot afford. This model, in so far as water service delivery is concerned, will help alleviate that pressure.

Now, the member also pointed to the definitions in the legislation around safety, quality, resilience, accessibility, affordability, and efficiency as defined in clause 3(1), the purpose of the Act. Look, let’s just talk about efficiency—well, actually, let’s talk about the expression of that statement. It actually sets out what we want to see going forward in the future. Because if we look at an inefficient system, the greatest challenge we have in our water network is the amount of leakage that is occurring. Nobody wants to talk about that, but people know that if the pipe is leaking and then their water bill is going up, something’s wrong. We don’t want to see that. We know that greater efficiency can be achieved by addressing the issues of leakage, but you have to understand your water network to even get to that point. And what we found out, in the last five years of accumulating evidence, is that many councils are not able to quantify a simple thing like leakage and the cost impost that that causes their ratepayers. The solutions that we have will lead us to a pathway of greater efficiency of use: reducing leakage and improving the way in which we’re using water, because water conservation goes hand in hand with efficiency as well.

Affordability: I think I’ve spoken quite a bit about that, based on the costs that councils have offered up. And I know members on that side of the Chamber have critiqued the figures that we’ve put up, but we have ensured that many of the cost analyses have been peer reviewed. Much of the costs came through a request for information (RFI) process that we embarked on with councils because we wouldn’t have been able to magic up the numbers. We had to ask councils themselves to go through a thorough RFI process, line by line, and help us get accurate information in order to model the features that inform this particular model. It was councils who came up with the information.

When we think about resilience, this is where climate change comes into play, because right now, if our immediate challenge is addressing repairs and maintenance and then responding to growth, we won’t be able to have a resilient system until we can do the core features of strengthening our water network. But do you know what? Every time there’s a significant natural weather event, we know how vulnerable our water network is, because stormwater goes out into our rivers and lakes. We know that waste often is on our streets when there’s a big flood event and we know that those vulnerable communities who cannot now afford to pay for good resilient infrastructure will be deserving as a result of these changes.

CHAIRPERSON (Greg O’Connor): The time has come for me to suspend the sitting. The committee will resume at 9 o’clock tomorrow morning. Good evening.

Sitting suspended from 9.56 p.m. to 9 a.m. (Wednesday)

TUESDAY, 22 NOVEMBER 2022

(continued on Wednesday, 23 November 2022)

Bills

Water Services Entities Bill

In Committee

Part 1 Preliminary provisions (continued)

CHAIRPERSON (Hon Jacqui Dean): Members, the House is in committee on the Water Services Entities Bill. When we suspended last night, we were considering Part 1 of the bill. Once again, the question is that Part 1 stand part.

SIMON WATTS (National—North Shore): Thanks very much, Madam Chair, and good morning, Minister. Thank you very much, Minister, for coming back this morning.

My first question relates to a question that I raised last evening, and it’s in regards to Supplementary Order Paper 283 in my name and it references clause 4, which, of course is part of Part 1. The question in particular that I ask is that the changes that were made late in the select committee process, in regards to the addition of both coastal waters and geothermal waters, were significant changes in regards to the scope of the overall bill. And I think for those that are sitting at home this morning looking forward to another big day on three waters, well, I’m not going to let you down.

The question in regard to the inclusion of, in effect, these other two waters, which makes the bill, in our view, five waters, is why was that addition made late in the process? It did not allow all of the submitters that made submissions in regards to the legislation to make submissions on that specific aspect. And I think that’s pretty fundamental, because we received, as we know, 88,000 or so submissions, but the fundamental change that was made in order to add coastal water and also geothermal water was done after the process in which public submissions were being able to be taken. The question quite simply, as I’ve said, is what is the reason or rationale that we didn’t allow our submitters to do that, with quite a significant expansion of the Te Mana o te Wai statement, which has been very much litigated in the public?

I want to move on in terms of the Minister’s Supplementary Order Paper that she tabled last night. I don’t know about you, but I got home and I thought, “You know what? I might spend a little bit more time having a bit more reading.”, and I started reading through this, and it’s interesting. I refer to Supplementary Order Paper 306, and it is inserting new clause 5A into Schedule 1. And this goes back to a conversation that I’ve been questioning the Minister around in the House a lot, in regards to parks and reserves, and the simple fact that it is our reading of the bill that was on the Table that, actually, local parks and reserves may be transferred from local councils into one of the water services entities. Interestingly, when I questioned the Minister in the House last week in regards to that, the Minister was quite clear. She said only assets which have a primary purpose will not transfer—the primary purpose being a park.

So what I would like the Minister to do is to provide a little bit of clarification around new clause 5A, in Schedule 1, in regards to whether this is a clarification of the overall position around what parks and reserves will transfer into these water services entities, or, actually, is it a change? I think that’s a pretty important aspect in regards to clarification.

The other aspect is how are you going to define the difference, because in the clause here under 5A(3), you’ve got some distinctions around what will be in and out. And so 5A(3)(c) states “whose primary purpose or predominant use is not the delivery of water services”. So my question for the Minister in regards to this is, quite simply: what is the process going to be in order to define or determine what falls within scope and what falls outside of scope in regards to that? Could the Minister provide some examples to help clarify what we mean by that, because the Minister will recall, in oral questions that I asked last week, I mentioned Waitangi Park here in Wellington. I asked whether that would be in or out of scope, and I’d be interested if the Minister could clarify that specific example of where that sits in the context of the drafting of this clause.

The last aspect that I’m interested for the Minister to go into in regards to this clause—[Time expired]

SIMEON BROWN (National—Pakuranga): Thank you, Madam Chair, for the opportunity to take a call on Part 1 of the Water Services Entities Bill. I appreciate the opportunity to ask the Minister some questions. My questions relate particularly to clause 4, “Te Tiriti o Waitangi/the Treaty of Waitangi and Te Mana o te Wai”. The clause states, “(1) All persons performing or exercising duties, functions, or powers under this Act—(a) must give effect to the principles of te Tiriti o Waitangi/the Treaty of Waitangi; and (b) must give effect to Te Mana o te Wai, to the extent that Te Mana o te Wai applies to those duties, functions, or powers.”

My question is: what are the principles of Te Tiriti o Waitangi/the Treaty of Waitangi? I can’t find them defined in the legislation. I’ve been through the definitions in the bill, and there’s a range of definitions in terms of the interpretations: board members, chairperson, commission, committee, constitution, stormwater network, green stormwater network, and a whole range of other things, but I can’t find any definition of what the principles of Te Tiriti o Waitangi/the Treaty of Waitangi are.

The question I have that follows that is: is there a difference between the interpretation of Te Tiriti o Waitangi/the Treaty of Waitangi, and which interpretation will prevail? I understand there’s a range of judicial court judgments which have been handed down over the years by our illustrious courts in this land, trying to interpret the principles of the Treaty of Waitangi, and I ask the Minister why this has not been put into the legislation to clarify what is actually meant.

Then the question is: which would be given effect to if there is a difference between the two? If there is a difference between the interpretation of the principles of Te Tiriti and the principles of the Treaty, which would be given preference? I think that’s something that certainly affects this piece of legislation significantly due to the fact that all persons performing or exercising functions under the Act must give effect—it’s not that they must consider or must think about or must look at—to the principles. So if they’re giving effect to something, isn’t it helpful to know what they’re giving effect to? I think that most New Zealanders looking at this piece of legislation think this is the biggest rort ever by the New Zealand Government, taking assets off local councils that have been paid for by the ratepayers over many decades, and possibly taking their stormwater assets too, parks and reserves across New Zealand. I can think of parks and reserves across my electorate of Pakuranga which could be at risk of being stolen by this Government, and it would be helpful to know what is actually being given effect to. A number of people—the boards, the chairpersons, all of these people—are going to get appointed, and they’d probably find it quite helpful to know what they have to give effect to as well.

If it’s so important that it’s a “must give effect to”, what’s so hard about actually putting that in the legislation and making it clear and transparent for New Zealanders to know exactly what is being given effect to? So I ask the Minister to take a call and to answer the question and to list, so it’s on the Hansard, so the courts of this land, when they are trying to interpret this legislation in years to come—if it’s not repealed by then—are able to know exactly what the Minister and the Government were considering when they said “must give effect to the principles of Te Tiriti o Waitangi/the Treaty of Waitangi”. Secondly, we need the Hansard to say which should be given preference if there is a difference between the two—between Te Tiriti of Waitangi and the Treaty of Waitangi. I look forward to the answers from the Minister.

SIMON COURT (ACT): Thank you, Madam Chair. Minister, last night, when we were debating the bill, you described the ownership of the three waters entities, organisations—you stated that councils will continue to own the assets, Minister. We got on to that topic because my question was, how will Te Mana o te Wai statements be given effect to and how will they affect the ability of these three waters entities to actually deliver fresh water to communities and to allow people who grow things in New Zealand, who manufacture things, to know that they can get access to the allocation of water that they need to? And, Minister, in response to some of my questions you stated that councils will continue to own the assets, that Māori are happy with that—I’m assuming you’re referring to people who have Māori ancestry—and you went on to clarify that iwi are happy for councils to own assets and to have a shareholder.

Now, what I want to understand is, if councils continue to own these assets, will they be able to borrow against them? Because if I owned an asset, or if I was a business owner or I had a piece of infrastructure—whether that was a power station or a factory that was an asset my business owned—I would be able to go to the bank and say, “I want to borrow some money to build my next factory or my next power station and use the revenues from my current factory or the collateral that my asset offered.” So, Minister, will councils be able to borrow money against the assets that you stated they will continue to own? That’s question one.

Question two: will councils be able to generate revenue from these three waters assets? Because you’ve stated that they continue to own them. So will councils be able to generate revenue from these assets?

Question three, Minister: will councils be able to choose how these assets are used? Because, if they are, in fact, owners, will they be able to have a say in how the three waters assets are used—whether it’s drinking water or whether it’s in the provision of wastewater services and connections, say, to enable housing development or to up-zone and densify existing cities? Will councils be able to choose how the assets that these three water services entities are meant to have collated together—if they own them, will they be able to say how they’re used, or will they lose the right to say that? Because so many of the submitters who came to select committee, Minister, said that based on the legislation that was proposed, they wouldn’t have control over their assets and they wouldn’t be able to say how they were used, how water is allocated. In fact, the loss of control and the centralisation of the management of these water assets in one of the new water service entities meant that communities would no longer feel that they had an ability to influence how those assets were used.

In many cases, councils around New Zealand have invested in their water infrastructure and have put aside money. We heard from the Mayor of Ōpōtiki District Council, who told us that they have not only upgraded their waste-water and water treatment assets but they’ve put aside $10 million in cash to fund the next round of upgrades. Minister, the thought that that asset from Ōpōtiki District Council and their cash would be hoovered up by one of these water service entities and that they would lose control over it was one of the most powerful, motivating factors in opposition to this bill from communities up and down this country, that led to 88,000 submissions arriving at the Finance and Expenditure Committee for us to consider.

So, Minister, three questions. Will councils, if they own these assets, be able to borrow against them? Will they be able to generate and take a share of the revenues that these assets generate? And will they be able to choose how the assets that you state they control, and the services that arise from those assets, are allocated? Minister, those three questions—an answer for those, please.

BARBARA EDMONDS (Labour—Mana): Thank you, Madam Chair. I wanted to be able to ask a couple of questions to the Minister based off some of the other comments that were raised by the opposite member Simon Watts, because he does raise a good point around Te Mana o te Wai definitions.

Simon Court: Just let the Minister answer.

BARBARA EDMONDS: My question around this is—and again that member is welcome to ask the question, which he just has, so in the same respect, I’m also allowed to ask a question.

So during the select committee process, we had heard from submitters, including Federated Farmers, around Te Mana o Te Wai. One of their particular things they asked the committee to look at was to ensure there was a legislative definition of Te Mana o te Wai in this particular bill. So, therefore, off the back of that, the committee sought advice from officials, officials agreed, so what the committee agreed to is to put in—in Part 1 in the definitions—an actual definition of “Te Mana of te Wai” as a result of that Federated Farmers submission. Now what I understand, though, is that the Minister—

Hon Gerry Brownlee: It doesn’t mean anything.

BARBARA EDMONDS: So it actually sets out that Te Mana o te Wai applies, for the purpose of the Act, not only to freshwater but also to coastal water, and geothermal. Those three terms are defined in section 2(1) of the Resource Management Act. Now Minister, I’ve just noticed that your Supplementary Order Paper (SOP) 306 amends clause 6 by making a different definition of “Te Mana o te Wai”. My question to you, Minister, is: how does your definition, which you put in SOP 306, reflect the call from Federated Farmers to make sure that there is an actual definition within the legislation of Te Mana o te Wai, and how does that reconcile or align with the Resource Management Act? Thank you, Minister.

Hon NANAIA MAHUTA (Minister of Local Government): I thank the members for such vigorous questions at this time of the morning, on this particular bill, and I want to go through some of the core elements of the questions that have been asked.

Firstly, in relation to Mr Watts’ Supplementary Order Paper (SOP) 283 and his amendments to clause 4, we stand by the inclusion of a broad definition of water in relation to Te Mana o te Wai, and outlined in the Government SOP, to ensure water service entities will have to work with mana whenua to protect water and water bodies. The definition is holistic and creates a stewardship set of responsibilities for the way that water is used and cared for. In other words, the health and wellbeing of waterways sits at the heart of why Te Mana o te Wai has been recognised and why the water reform approach in this bill has been proposed in the way that it has.

Coming to Barbara Edmonds’ particular question, what we’ve done is draw on existing convention in relation to Te Mana o te Wai, which was established in 2014 and which is accommodated for in the Resource Management Act. What I have in my SOP is the legislative clarity that was sought at the Finance and Expenditure Committee, through submitters, and for the purposes of applying this Act how it will be integrated and implemented within water service delivery. What that will mean, if we think about the inclusion of coasts, estuaries, lagoons, and puna, which is the broadest set of definitions, is that water services like waste water and stormwater, which commonly discharge into coastal areas, harbours, or estuaries, will actually be included in the way in which we improve environmental outcomes.

Coastal areas are places where iwi have really strong interests, but not just iwi alone; it’s a recreational place for many New Zealanders, and there are lots of connections that many of us across this House have in order to ensure that we can go to our favourite beach and swim there without a no-swim notice. Let’s go to an example: Wairoa, perhaps, is a really good example. The wastewater plant there has breached resource consent requirements for years now and discharges directly into the coastal part of the river mouth. Local iwi have lived there continuously for many generations. People who live there now preserve that way of life to ensure that the coastal area is clean, that the beaches are able to be swum in, and so what we have is an opportunity, by integrating Te Mana o te Wai concepts, to ensure that discharge to coastal areas does no more harm to the environment, because as we protect source water, as we use it for whatever purpose and then discharge through wastewater treatment plants, or as we better regulate stormwater, we can guarantee our communities a quality of life.

But let me come, again, to a particular example. In Simon Watts’ area, in Auckland, what we have is that there are 18 wastewater treatment plants provided by councils. Of these plants, seven plants discharge to freshwater and eight discharge to the ocean. In 2019, three of Auckland’s wastewater treatment plants were operating on expired consents, with a further eight due to expire in 2029. So if ever there was a reason to ensure that we took a holistic approach to the way in which water service is delivered, but also discharging back into our environment, like the coast, our estuaries—

Hon Members: Beaches.

Hon NANAIA MAHUTA: —our beaches; that’s right—we have to have a holistic system. That’s why Te Mana o te Wai is there.

Now, Mr Brown and Mr Mooney asked about the Treaty of Waitangi in clause 4. What we have there is a reference that is consistent with the Treaty of Waitangi Act 1975, which is legally certain, which is articulated in case law and, actually, on that side of the House, has been accepted by many a National Minister, especially when it comes to Treaty settlements. But, if you look down into clause 5, what you have is a clear articulation of how the principles of the Treaty of Waitangi relate to elements of this Act, and it is set out clause by clause, no more, no less. The intent is clear. The way in which the Treaty provisions apply is articulated in clause 5—no more, no less—but it does enable the Crown to uphold its obligation in terms of Treaty settlements, which both sides of this House are committed to. It does enable a partnership approach, which has already been expressed through Treaty settlements and relevant at local government level, to be integrated into this particular model of reform.

Hon GERRY BROWNLEE (National): Thank you, Madam Chair. Firstly, can I say to the Minister that it would be nice if the Minister actually took to the floor to answer the questions that were, I think, quite reasonably posed by my colleague Simon Court—those are fundamental to the public understanding of this bill and to ensure that the words that are often spoken by the Government in favour of this bill are not just a deception to make people feel comfortable with what is effectively a massive asset grab from the ratepayers of this country. Those simple questions: can they derive a revenue stream from the assets they own, and can they borrow against those assets? One of the things that is important about that answer will be the debt ratios held by local authorities now based on the assets that they are able to control. And “control” is the important word. It’s all very well and somewhat a bit of sophistry to say, “Well, they continue to own them.”, but if they’ve got no control over them and have no capacity to realise those assets in some form at some point, then quite clearly their debt covenants could be affected adversely. I don’t think any of the compensation that’s been talked about by the Government at the moment would go near to sorting that out, so we look forward to those answers from the Minister.

When it comes to Te Mana o te Wai, I think the concept itself is easy enough to understand, but it becomes confused, I think, by the provisions that are further on in the bill, which set out who can in fact make these statements and provide them to the water authorities. So in the South Island, we’re going to have—should this bill progress—for a period of time anyway, one water authority for the entire South Island. Throughout that area, there are any number of hapū—maybe just the one iwi with a few smaller iwis at the top of the South Island—who are able to provide these Te Mana o Wai statements.

My question is: when a body of water that travels across greenfields, effectively, is split across different hapū, how is the water authority expected to deal with the expectations stated in those particular Te Mana o Wai statements provided to them? It’s very simple, in my head, to understand the way in which the South Island river structure works, both east and west and south and north, and across all of those there are multiple hapū who will have an interest. In some cases, there will be egress of awa, rivers, that will have the lagoon structures that will cross a couple of hapū and have, therefore, different interests. So the question becomes in my head: how does the authority ultimately rationalise the many Te Mana o te Wai statements that they’re going to be presented with to get some sort of reasonable response to the expectations that those statements are going to prefer upon them? As the previous speaker made clear, Mr Brown in fact, there is an obligation on them to do that. It’s not something they can just tick-box and shove to one side, unless, in fact, that is the intention of the Government—to simply sell a few views by putting it in here but not making it terribly important in the long run.

The question also becomes about the rights and interests in water preserved, in clause 9A. Some greater explanation of that, I think, is needed from the Minister, because there are, across the Canterbury Plains, numerous water rights and, across any farming district in New Zealand, numerous water rights are held through the existing legislation and responsibly used by farmers. There are also numerous numbers of irrigation schemes across the country entirely designed to preserve the water source to make the best use of it, to capture as much of the rainfall that would provide some fill for the plethora of dams and storage ponds that would exist across the country. Now, all of these, under this legislation, come under the purview of the new water authorities. So the question really is: what is the value, now, of the consents that those people hold? What is the life of the rights? It doesn’t seem to me at all clear in clause 9A that while it used the words, once again, “Rights or interests in water preserved”, there is, in fact, any ongoing opportunity for the length of whatever their consent might be to continue taking the water that the right preserves to them.

Further to that, where is the interface expected to be between the new water authority and something like the Central Plains Water scheme? The Central Plains Water scheme, for those who are unfamiliar with it, has been a massive boon to protecting the aquifers under the Canterbury Plains and has had an enormous effect on the ecology of the of the area—of the two rivers it’s between—

Hon Eugenie Sage: Detrimental, not positive.

Hon GERRY BROWNLEE: Beg your pardon? I was asking a question. There’s someone down there mumbling. I can’t understand. Take the mask off so we can hear what you’re saying.

The point is: how does that scheme, which is being administered very responsibly at the present time and is doing a great job in ensuring that the water resource on the Canterbury Plains is used responsibly—what is the overlay, now, for the water authority? Is the organisation and structure of that particular scheme, and the many other schemes that we could name throughout the country, now subject to the overarching authority from the new water structure or water entity that’s being put in place?

I think one of the things that this bill denies is that there has been a growing awareness in New Zealand of the need to preserve the water resource that the country has, and that will often be, interestingly, on an area by area basis. So if you conflate those two things a little bit, Te Mana o te Wai, which means that a small group in any particular area can have a huge say over how the water resource should be treated but that others who have done a huge amount of work and made massive investments into the structures that look after water in the regions apparently have very little say—and a much lesser say than those who have that other connection. I think that’s something we need to have clarified by the Minister in the Chamber today.

So rather than taking a lot more time, I’ll just go over those questions that I’ve raised. How does the new authority operate in conjunction with, or alongside—or is it over the top of?—existing water authorities that are privately held, essentially, but are held with the proper consents granted by the wider community? How do the individual farm properties that have a water right have any surety that they’ve got some tenure over the consent that they have been granted? Then those two questions from my other colleague Simon Court, asking about the ability of councils to use the asset that apparently they’re going to continue to own as collateral against some of their borrowing, making their debt covenants more viable. And then, of course, the questions: will they continue to be able to get some revenue stream from those assets?

Hon NANAIA MAHUTA (Minister of Local Government): Given that it’s the member’s first time taking a call and that the material is significantly new, can I just respond to the issue of consents for water use in the first instance. This bill is not about consenting. In fact, the existing consenting regime through the Resource Management Act remains, and those consents that have been already awarded stay intact. This bill is about water service delivery and covers councils primarily and those water supplies that currently sit under councils. I know that the member’s brought up private water suppliers and independent water suppliers, mixed-use suppliers. To the degree of intent that we have in this legislation, it was always very clear that the legislation covers those councils who deliver water and those supply schemes who currently sit under their councils and are primarily managed by their councils. So that’s that in the first instance.

In the second instance, the member raised an issue in relation to the South Island. Far be it from me to perhaps explain the mana whenua interests in one’s own area, but given that the member was a part of the Government who settled the Ngāi Tahu Treaty claim which confirmed the legal identity of Ngāi Tahu and their Papatipu Rūnanga, Te Mana o te Wai statements will be developed through that particular structure, which actually makes it administratively more seamless for that iwi. And in the instance that the member relates to, it may well be that under a Papatipu Rūnanga there will be many hapū that sit under that organisational structure, but it is within the context of Ngāi Tahu, in their structure for their iwi, that those interests will be accommodated for and relate in a relevant way to the catchment across the South Island.

In relation to the questions that both Mr Brownlee and Mr Court raised around borrowing and security against water assets, the whole premise of this reform is to be able to derive benefit from scale and aggregation. Yes, the councils will continue to own the water network assets. The debt and liability of those water assets will transfer to the water services entity to be able to create that aggregation of scale, to be able to derive broader benefit across the entity region. It’s not appropriate probably in this part, but perhaps if the member looks forward to clause 166, that would be the appropriate place to get greater clarity about what can’t happen in relation to water service assets. So councils independently as a result of this legislation will not be able to take security or borrowing against the assets once this bill goes through.

HELEN WHITE (Labour): Thank you, Madam Chair. Minister, I have a woman in my constituency who asked me about her husband who works for Watercare. Obviously, we’ve had really good submissions come in from the union that supports those workers in support of the bill because they have really moved from the transition from the old system to Watercare and now they’re moving again.

That woman was asking me a really bread and butter question, and I think it’s what a lot of New Zealanders really want to know. How is it going to be for the workers who transfer into these new entities, what kind of change will they have to cope with, and how have you provided for them?

CHAIRPERSON (Hon Jacqui Dean): Order! Can I ask the member to confine her comments and questions specifically to Part 1?

HELEN WHITE: Yeah, so that is Schedule 1 of Part 1, Madam. [Interruption]

CHAIRPERSON (Hon Jacqui Dean): Let me sort this out; do this properly. OK, Helen White.

HELEN WHITE: Thank you. Actually, that’s the end of my question. I’d just like to know about the transfers.

NICOLA GRIGG (National—Selwyn): Thank you, Madam Chair. I want to turn the Minister’s mind, please, to Part 1, clause 6—seeing as we’ve been traversing much of these parts—and the definition of “green stormwater infrastructure”. As the Minister will be acutely aware, the Canterbury province suffered some one-in-200-year storms almost two years ago, in May 2020, and then again in June 2021. What we’ve seen in that intervening period of time are large-scale landscape changes, and the Minister will also be aware that the regional council has lobbied the Government for financial assistance to continue to clear rivers to ensure future flood-proofing.

Now, if the Minister drives south from Christchurch, there are three large rivers. There are the Waimakariri, the Rākaia, and the Rangitata River, and in between there is a slightly smaller chain of braided rivers called the Ashburton River, which runs out to sea on the township of Ashburton. If you drive inland from the Rākaia River specifically, you’re on a road called Thompsons Track, and then I’m thinking of a specific area where you turn right on to Tramway Road. This was an area of farmland that suffered enormous damage. I think up to 20 if not 30 hectares were submerged. Now, what we’ve noticed there, when I refer to landscape change, is that particular wetlands have arisen: bog, or you might call it a lagoon of sorts. But my question really is around the definition of “green stormwater infrastructure”, particularly when we’re referring to “a natural or semi-natural area, [etc., etc., etc.] … managed to provide stormwater services;”.

In this particular area that I’m thinking of—and there are multiple instances of this across the Canterbury region—there is an intersection of roading and stormwater drainage of a natural river and farmland. In this particular corner, I’ve noticed in the last 18 months—and when I say “corner”, I’m talking of probably two, if not three, hectares of crack willows arising. These, as we all know, will cause floods because they do cause blockages, and this is right on the Tramway Road bridge, which I presume is going to be managed by the Ashburton District Council.

So here, to my mind, we have a confluence of different authorities. We’ve got to some degree the New Zealand Transport Agency (NZTA), we’ve got to some degree the Ashburton District Council, and we’ve got to some degree the landowner, and, presumably, in future, if and when this bill passes, Entity D will have the overarching authority over this space. Where is the demarcation as to who manages the future flood-proofing, the flood mitigation work, of situations like this? As I’ve said, these are occurring multiple times throughout Canterbury, with all the network of braided rivers we have, all the roads that run along the rivers and run across the rivers, the bridges that run across the rivers, and, of course, the stormwater systems that have been established, both naturally and man-made, to feed water back into the waterways.

We’re also seeing instances—and, again, I’m talking about the stormwater infrastructure in, particularly, my part of the world, in Selwyn, around Te Waihora / Lake Ellesmere. Historically, there’s been a large flood bank that has been built and managed by the regional council—by Environment Canterbury. Over the past year, we’ve seen a number of large southerly swells and southerly storms that have come in, and they have, effectively, smashed that flood bank to smithereens. There’s now a landowner who’s got 60 hectares of land covered in flood debris, rocks, sand—you name it. Right alongside that farm is the Taumutu marae, and already they’re seeing that their urupā has been exposed by the sea and they are being moved away by this change in sea swells.

So with regard to the provision of flood banks and flood protection, at the moment the regional council and the district council have thrown up their hands and said, “We don’t manage this any more. The climate is changing. This is unaffordable.” But in regard to the fact that this flood protection bank has traditionally protected both farmland, and urupā and marae—again, to what degree is there a demarcation, and where is the ongoing responsibility for the management of these kinds of what I presume would fall under green stormwater infrastructure and the way that they will be managed to provide stormwater services?

So the picture I’m trying to paint is that there are multiple existing authorities, there are multiple flood-mitigation measures, and there’s also the ongoing conversation about the lack of financial resourcing to continue this flood mitigation work. Then, of course, I could further extend that definition of “green stormwater infrastructure” to the large-scale aquifers that fall underneath the Canterbury Plains. One might describe this as naturally occurring stormwater infrastructure, of course, allowing the free flow and drainage of water from the underground aquifers or rivers out to sea.

We’ve seen again that we’ve had a particularly wet winter and spring. You only need to fly into the Canterbury Plains to see how very, very waterlogged they are. Obviously, in recent times they have dried up, but that water did stay for at least four to six weeks. The whole plains were like a sponge full of water—absolutely logged with water. There is no drainage, so, of course, with that surface water building, you increase the risk of more surface flooding on to roads, particularly, and into our stormwater networks.

The networks are starting to fail because they are being overused and they haven’t had the investment put into them. That is because there is so much confusion and complexity in the system, but I think that was made more particularly convoluted by this particular clause—clause 6—in that there does not seem to be a definition—a true definition—of “green stormwater infrastructure” as it applies in reality. So, Minister, I would like some clarification around the responsibility for the multiple agencies: the NZTA, the Ashburton District Council, the Selwyn District Council, Environment Canterbury, the landowners themselves, and, of course, the potential for this Entity D.

Hon EUGENIE SAGE (Green): Tēnā koe, Madam Chair. Thank you. I think the member Nicola Grigg makes a good point, and it’s one of the reasons that the Green Party—and there is a Supplementary Order Paper (SOP) in my name—seeks to withdraw all of the provisions around stormwater from the bill—because of the huge complexity in managing these areas and in areas like Canterbury integrating with flood protection management.

I know that in SOP 306 there are changes to new clause 5A, in Schedule 1, which talks about the “guiding principle for treatment in allocation schedule of secondary water services.” I’m just asking the Minister whether there’s been any consideration if/when councils are developing their asset registers—and it highlights what Nicola Grigg and I talked about yesterday with the stormwater assets that are fundamentally natural areas where there are a range of agencies involved, where local authorities are also providing for recreation and other values—of relooking at including stormwater because of the complexity of the landownership and the management of these areas. And I’m asking whether, in the Minister’s SOP, in terms of Schedule 1, new clause 5A, those guiding principles could lead the Department of Internal Affairs and the entities to decide that a lot of these assets which have got multiple agencies involved for stormwater stay with the councils, and then what provision there will be to ensure that councils can continue to fund management of stormwater there, because they won’t necessarily be able to borrow against the revenue they get for charging for water services because that’s all been transferred to the entity.

Stormwater is incredibly complex to the land asset and it’s not a pipe system, so I’m wondering whether the Government considered actually putting a pause on the transfer of stormwater or coming back to that issue in the subsequent legislation that’s going to be introduced, primarily around the transfer of assets so that entities can focus on drinking water and waste water and not have the complications of stormwater management.

ANDREW BAYLY (National—Port Waikato): Thank you, Madam Chair. What a pleasure. First of all, I just want to pick up on my good colleague Hon Gerry Brownlee’s comments earlier.

I’m referring to the definition of “water supply”. In clause 6, “Interpretation”, “water supply” includes, in paragraph (c), “water supplied for agricultural or horticultural purposes”. I’m keen for the Minister just to give us an indication: what is the threshold for that definition for water supplied for agricultural or horticultural purposes?

So is that a pipe system coming off—one operated by district council—a reticulated system, which means there’s a pump, and is the pump one that must be operated by a council operation? Because if it’s an agricultural pump—one operated by the local farmer—that gives a different intent to that piece of legislation.

Secondly, what is the threshold? Because if it’s just turning on one small tap, that’s one thing, and obviously it should be a de minimis level in that. But I don’t see any sort of threshold at which stage something that is a water supply for agricultural or horticultural purposes would be captured under this bill, which will obviously be of real concern to horticulture producers, particularly in my electorate in Pukekohe.

The other thing is about natural watercourses. Already they’re under a lot of pressure with water that flows through their land, and now we get back into the definition of stormwater. Is the ability to capture that water on their land—obviously as the councils are starting to impose rules and regulations on that, does this bill anticipate any further restrictions on farmers and growers being able to capture that water? So that’s the first question.

Now I’m going to turn to Schedule 1, which is part of Part 1. I suppose the first big thing is the appointment of the establishment chief executive. The establishment chief executive is nominally accountable to the department as it’s defined in this part of the bill. Yet that nominal chief executive is then required to do a stack of things in this Schedule. For instance, the establishment chief executive must do a 10-year plan and must lay all that out.

So I’ve got a couple of questions. First one, with the establishment chief executive effectively being appointed by the department, what are the rights of the new board to fire or change that establishment chief executive? Secondly, what is the process for the establishment plan for the infrastructure that’s put in place for the new entity—one of the four entities—to be able to review that immediately or, in fact, reject it if it’s not thought to be properly taking into account the individual council priorities around its infrastructure?

So what is the process to do that, or is it just an annual review or can they do it straight away? What will happen if they do reject both the CEO and the plan? So I’ll start with that; I’ve got a stack of stuff I want to talk about to do with this establishment phase.

MARK CAMERON (ACT): Thank you, Madam Chair. Minister, last night you and I canvassed the green stormwater aspect in clause 6, “Interpretation”, and both Nicola Grigg and the Hon Eugenie Sage brought up how convoluted this could actually be for the ownership structure and the operation of these freshwater assets as they go over land. Now, I just want to give you a bit of pause here. I live in the Kaipara district area and we have the Raupo Drainage Board. That has gone through 130 years of reclamation. All of those water assets up there have been managed locally, Minister. In this instance, the operation, the monetisation, and the oversight of those local assets would go.

Now, I’m trying to reconcile that. When you take that story anywhere in rural New Zealand, green overland flow, water infrastructure—how it’s managed, who has oversight, where the revenue streams are coming from—in a lot of cases, these are local catchment groups that have got very nuanced—very nuanced—methodologies, funding streams, etc., etc. Now, we were very collegial after the fact when you and I spoke last night. Again, do we need to actually have the stormwater aspect—the Hon Eugenie Sage and Nicola Grigg and myself have brought this up—taken out of this piece of legislation? This is massively—to use Nicola Grigg’s words—convoluted.

Dr DEBORAH RUSSELL (Labour—New Lynn): Following on from the question about stormwater, I have a similar one related to concern from my own area, the New Lynn electorate, which includes the entire Waitakere Ranges. A number of people in the Waitakere Ranges have expressed concern that the land there might transfer to the new water services entity and pass out of local control, because it has significant water catchment dams there. They’re very beautiful, very important to Auckland, near 100 percent full, but the real worry is the surrounding water catchment. So I’m asking if the Minister could please give some assurance that the land, the park—the beautiful Waitakere Ranges Park—will remain in local control under the new water services entity. Thank you.

Hon NANAIA MAHUTA (Minister of Local Government): Thank you, Madam Chair. Given that there’s been a significant contribution around the issues of stormwater, can I perhaps cover them off in a complete response. Firstly, there was a rationale around going through the process of whether or not to consider stormwater, and in urban areas what we recognised is that many councils had identified that, by and large, in urban, dense areas you have a stormwater system that sits alongside your drinking- and waste-water system and you would have better integration for urban planning processes in order to achieve better outcomes.

When we think about, for example, the work of Minister Woods and the current Government contribution to support councils to have housing developments, that particular contribution to the infrastructure cost is a real cost on councils, so it made sense to really consider whether or not stormwater should be in or out. Then we created a Stormwater Technical Working Group, and what was most helpful about their considerations is that they identified the range of stormwater examples that we would have to take account of were we to include stormwater. Around about 60 to 80 percent of stormwater assets are currently listed in asset management plans, so the intention of this legislation is that those assets, by and large, will transfer, but there are mixed-use assets, and the questions that’ve come up in the House relate to those mixed-use assets where we need to determine what is the predominant use of these areas. If the predominant use of these areas is not for stormwater but they have a particular purpose, then there is a way that the council can negotiate with the water service entity about its long-term management or whether in fact it indeed needs to transfer or whether there need to be access rights. That’s all contained within the context of the bill. It will be done on a case by case basis and in accordance with a conversation with the council.

Simeon Brown: It’s all up for grabs, the whole bang lot.

Hon NANAIA MAHUTA: No, it’s not—

Simeon Brown: Yeah, it is.

Hon NANAIA MAHUTA: —and, in fact, the continual mistruths coming out of that member because he doesn’t read the bill—it’s a shame, because these are serious issues, and—

Simeon Brown: No, no, no, this is what you’re saying. It’s all up for grabs.

Hon NANAIA MAHUTA: No, it’s not.

When it comes to ensuring that we have really good urban design, when we look at including stormwater and clarifying the provisions around green infrastructure and providing an opportunity to enable water service entities to—rather than underground solutions, they could surface solutions. Like we’ve seen in Wellington at Waitangi Park, like we’ve seen in Christchurch, like we’ve seen in Auckland with the Manukau transport centre, we know that there are better solutions rather than just undergrounding them when it comes to stormwater.

I want to come to the particular question of the member in relation to parks and reserves, because I think the question is broader and it is one that warrants a response. The criteria for transferring stormwater infrastructure is based on whether it is predominantly used to manage stormwater, as I’ve said many times in this House, and whether it’s critical to the stormwater system. In general, parks’ predominant use is not for stormwater. Their predominant use is as a park, a public recreation place where people love to go, and therefore they will not transfer to the new entities. That’s something that needs to be said very clearly. Territorial authorities will be heavily involved, as I’ve said previously, in identifying which infrastructure will transfer to entities. I must stress this point because it is by consent of the councils, not over and above them, because everybody preserves their quality of life through having good recreational places to take their children and the like. A park would never, therefore, be transferred out of a territorial authority management if it was not the wish of the territorial authority. So I really wanted to highlight that.

The other thing is that Helen White raised the issue in relation to Schedule 1—and it is relevant because it’s referred to in clause 7 of Part 1—and those are the transitional provisions. We were at pains to ensure that one of the key priorities in this reform programme was to make sure the people who are actually doing the work and needed certainty and assurance that their jobs would be protected will be provided for going forward into the future as a result of this reform. The member who asked the question will be aware, as a select committee member, that in Schedule 1 there are a range of areas that give those protections to people who are employed in this sector and want to know, want to have the assurance, that they have job certainty. There will be job progression in scaled-up entities, and if they choose to live and work in their own locality, which is often the case, there are options there. There are many other aspects that protect the employment conditions of workers who make such a fundamental contribution to water service delivery. We want that to continue.

Now, members on that side of the Chamber would have us believe that just because we’re establishing these four big entities, people will lose their jobs—they will not. Conditional on the transitional provisions that we have outlined here, the ability to look after people and ensure their employment security is a core pillar of our reform approach, because we know they matter. We know that they’re looking at these reforms in a way that their direct interests and contribution will be provided for, and I’m pleased that the select committee put such rigour over those provisions in Schedule 1 of the bill.

VANUSHI WALTERS (Labour—Upper Harbour): I move, That the question be now put.

CHAIRPERSON (Hon Jacqui Dean): No. No, not yet. I’m ruling on this. This a substantive part of the bill. I’m following the debate very closely. I’m fully aware that this is the second session that we have been considering Part 1 and Schedule 1. I would note that the committee of the whole House is fully engaged. Every party present in the Chamber is fully engaged in this debate. I notice a shift occurring to new matters that have not been traversed. How do I know this? Because I’m keeping track of everybody’s contribution.

JOSEPH MOONEY (National—Southland): Thank you, Madam Chair. To the Minister: I have a question, Minister, about Te Mana o te Wai and the Treaty obligations, and also clause 9A(1), which refers to “(a) any rights or interests in water are preserved, consistent with assurances—(i) given by the Crown to the Supreme Court in 2012; and (ii) recorded New Zealand Māori Council v Attorney-General [2013]”.

Look, I note that the Water Industry Commission for Scotland said that it’s important that regulation has to be independent of Government for this to work. So for effective regulation, it has to be independent of Government.

I also note that the S&P global ratings agency, who did a report on the credit implications of New Zealand’s proposed three waters reforms, was asked by the Department of Internal Affairs to evaluate the scenarios for hypothetical credit consequences on the ratings for New Zealand Sovereign, New Zealand Local Government Funding Agency, and several local councils. And they noted that the entities proposed were structurally separated from local councils and the New Zealand Government.

Now, I note that Te Mana o te Wai—if you look at clause 6, it says it “has the meaning set out in the National Policy Statement for Freshwater Management issued in 2020 under section 52 of the Resource Management Act”.

My question is: why has not Te Mana o te Wai been specified? Why has a definition not been put specifically into this legislation instead of it being in a national policy statement, which the Government, of course, can change at any time? Where does any certainty come from? Anyone who’s looking at loaning money to any agency for three waters infrastructure cannot have certainty as to the principles on which are being relied and that this is not independent of the Government, because the Government can change the Te Mana o te Wai national policy statement at any time.

I note that the Minister has pointed to scale and aggregation as being the rationale for these reforms. The Government’s point is to say that $120 billion to $185 billion is required over the next 30 years for water infrastructure, and supposedly we’re being told that entities will be in a better position to borrow sufficient capital to invest in three waters. My question is, how will those entities be in a better position if they cannot provide certainty to anyone looking to loan money to those entities if the regulation is not independent of the Government and there is not certainty as to what regulation will be applied?

That also points to the question which I asked the Minister last night and has not been satisfactorily answered to date. Part 1 makes it very clear that the matters of most importance are “[giving] effect to the principles of Te Tiriti o Waitangi/the Treaty of Waitangi.” Why have they not been specified? Why have they not been outlined in this bill? What are the principles of the Treaty of Waitangi, or Te Tiriti o Waitangi—because it’s either/or here? Why have they not been detailed in this bill? Where will the certainty be for anyone, again, looking to loan money to these entities for those $120 billion, $185 billion that Government is saying is going to be required over the next 30 years if there is no certainty as to what those principles are?

Going, again, to the certainty—or, I would say, the lack thereof—is clause 9A in Part 1, which says that “(1)(a) any rights or interests in water are preserved, consistent with assurances—(i)given by the Crown to the Supreme Court in 2012; and (ii) recorded in New Zealand Māori Council v Attorney-General [2013]”. I note that decision is 59 pages long; it has 151 paragraphs. Why hasn’t the Government specified specifically in this legislation what it means by “any rights or interests in water preserved”, instead pointing to a 151-paragraph decision by the Supreme Court for people to try to wade their way through to ascertain what the Government means by that?

This, I would suggest, is creating a huge amount of uncertainty. It certainly is not—that meaning—independent of the Government, particularly because the Government can change the national policy statement on Te Mana o te Wai at any time.

And why has the Government turned its mind to these risks to the entire programme it’s setting in place? I would suggest no one’s going to want to loan money to these entities given these significant risk factors and this uncertainty, which the Government has left in this particular piece of legislation.

ANDREW BAYLY (National—Port Waikato): Thank you, Mr Chair. I just want to pick up on a couple of comments from the Minister, the Hon Nanaia Mahuta. The first comment is that I’d like the Minister to confirm that the Hunua dams and also the Watercare dams in the Waitakeres will be transferred to the new water entity, and what does that mean? Does that mean the dams and associated pipes? And does that mean there will be restrictions around access to those dams in particular? So that’s a very specific question that the Minister raised before.

The second question that the Minister raised before was the issue of transfer of staff. My question to the Minister is: what is going to be the business model for the four new entities? There is an assumption—and she made the inference—that staff from the existing council operations will be able to transfer to the new water companies in a seamless manner. But the simple question is: if there is only one head office for each of the four water companies, how the dickens will someone, if they’re living in Gisborne, be able to move to Wellington if that’s where the new head office is? Or vice versa: if the head office is going to be in Gisborne, how do they move and transfer and, in fact, work? Is it going to be a remote model? I know the transition plan includes some ability to claim back mileage, but there is the simple practicality around how the dickens that’s going to happen. In many cases, people will not actually physically have the opportunity to work for a local provider. So understanding the business model—if there is going to be lots of hubs and one central head office, or whatever the case is going to be—would be very useful.

I want to now carry on with Schedule 1 because there is a stack of stuff in there that we need to talk about. The issue is around the transfer of the assets. The Minister has been talking about how the assets will be transferred and that councils will have to nominate those. The first question I’ve got is: what is the dispute mechanism if a council decides that it wishes to retain some assets and yet the new water company believes that it should have ownership of those? What is the independent process? I know it goes through to the Minister, but what are the criteria, and how will that be decided, and over what period of time? And what’s the process for coming to a resolution around that transfer of assets?

The fourth thing I want to cover—and I’m glad the Minister is writing things down—is that I want to turn the Minister’s mind to clause 5(6) of Schedule 1. This to do with the transfer of assets from a council-controlled organisation (CCO). An example of this is Watercare, and “The allocation schedule for a water services entity (a) must not specify assets, liabilities, or other matters that belong to any mixed-shareholder CCO; but (b) must list the shares in that mixed-shareholder CCO that are held by the 1 or more shareholders …”. Now, there are other CCOs that do have mixed ownership. What does this mean? My understanding is that what will be transferred to the new water companies would merely be the assets; the councils would be reimbursed for transitional costs, a one-off payment. I forget the name of it—some flash name—

Simon Court: “no worse off”—“better off”.

ANDREW BAYLY: No worse off—yeah, one of those ones, Mr Court. But the reality is that there was not going to be a transfer of liabilities to the new water companies. But if you are transferring shares, obviously that gives rise to—you’re basically taking over an entity, and that entity will no doubt have assets and liabilities and also contingent liabilities. So I’m trying to understand: what is the mechanism—what is the transfer? Will the new entity, in fact, pick up the liability for that? In some cases, that would be substantial. I know that Watercare doesn’t have third-party investment in it, but it does have $11 billion of assets and it has quite a significant pile of debt on its own balance sheet. So what would happen? In that case, would the new entities be picking up that debt as well as all the contingent liabilities that go with the staff—all that type of thing? Just understanding that transaction would be a very useful and helpful process.

Hon KIERAN McANULTY (Associate Minister of Local Government): Thank you very much, Mr Chair. So I’ll just go through some of the questions that Ms Mahuta hadn’t already addressed. So speaking to Mr Mooney’s questions, the water service entities will still be required to seek resource consents, just like any other party. Clause 9A has two outcomes. The clause seeks to preserve any rights and interests in water, consistent with assurances given by the Crown to the Supreme Court in 2012 and recorded in New Zealand Māori Council v Attorney-General in 2013. This records the acknowledgment given on behalf of the Crown that Māori have interest and rights in water and geothermal resources. That acknowledgment was given by the Rt Hon Bill English. Reference to the principles of the Treaty is consistent with the Treaty of Waitangi Act 1975. In regards to the regulation that the member was referring to, touching on the Water Industry Commission for Scotland, that was specifically in reference to economic regulations, not in reference to Te Mana o te Wai.

Mr Bayly’s questions: nothing in the bill would interfere with the public’s existing access to, or enjoyment of, parks and reserves in the Hunua Ranges. While the bill requires the activities of head office to be within the same entity—that’s clause 128—the entities will continue to have local officers throughout the service area, and therefore there’s never been any suggestion that what the member outlined will be the case.

SIMON COURT (ACT): Thank you, Mr Chair. It’s wonderful to have a different perspective from the Associate Minister Kieran McAnulty. So I just want to offer ACT’s helpful suggestions, Mr McAnulty, to this dilemma of what on earth a Te Mana o te Wai statement means and who should give it, and how we might define the principles of the Treaty of Waitangi. What I would propose, Minister McAnulty, is that if the Government were to adopt ACT’s Treaty principles, which I’m going to describe in a moment, and take up and support the Supplementary Order Paper (SOP) 291, where we proposed to replace the definition of “Te Mana o te Wai” in the Act with, actually, Te Mana o te Wai means “the objective of keeping freshwater in a safe and suitable condition”. And, if you look carefully, Minister, at SOP 291, that definition of “safe and suitable” is taken directly out of the Health Act. Imagine a Government that’s so efficient that when it’s designing new legislation, it adopts definitions that already exist. So, Minister, the ACT Party offers you Supplementary Order Paper 291, which simplifies the definition of “Te Mana o te Wai” and aligns it with safe and suitable water in terms of the Health Act.

Secondly, Minister, I want to come to the proposed Te Mana o te Wai statements for water services. This is clause 6. ACT proposes—and we think this would get widespread support from communities around New Zealand. In fact, for members like Helen White and Anna Lorck, who have expressed concern that, you know, the constituents who speak to them are really worried about Labour’s prospects in 2023 if this three waters bill goes through—look, if the Minister and the Government were to adopt ACT’s proposed amendments set out here in SOP 295, which says that Te Mana o te Wai’s statements could be “provided to a water services entity”, of course by mana whenua, but also by a local community—a local community—which includes everybody who lives in a place that needs drinking water, that discharges waste water, and that also has to manage stormwater properly.

And those local communities could be rural communities, as my colleague Mark Cameron has pointed out, or urban communities. For example, a new subdivision in Auckland called Three Kings, which is built partly in an old quarry, and where the playing fields, which are delivered by the developer and which will transfer into the ownership of Auckland Council on completion of the development—those rugby and soccer playing fields are also the blue-green soak pit for stormwater overflows when it rains heavily, and then that stormwater will discharge into the ground via a massive soak pit and underground lava tunnels that run out into the harbour. So when we’re thinking about integrated catchment management, Minister, we’re thinking about what’s important to local communities. ACT’s Supplementary Order Paper 295 would allow local communities, such as the people who live in Three Kings, to also make a statement to a water services entity about what’s important to their local community.

Now I want to come to the really, really difficult thing that this bill proposes. It’s that all persons performing, exercising duties, functions, or powers under the Act will have to give effect to the principles of the Treaty of Waitangi—those undefined principles, which have resulted in regulatory creep and a cultural veto for many vital projects that have to apply for consents—and there is no standard; there is no benchmark to understand what these principles are. This is what ACT offers you, Minister. Three principles—the New Zealand Government has the right to govern, and the New Zealand Government alone; the New Zealand Government will protect all New Zealanders’ authority over their land and property; and all New Zealanders are equal under the law, with the same rights and duties.

Now, that’s what we think the three principles in the Treaty of Waitangi say in English and in Māori. So, Minister, would you agree to adopt those principles and put them in the Act?

CHAIRPERSON (Greg O’Connor): Just from the Chair, I’ve been watching this debate. I was in the Chair last night; I watched for an hour. There is a lot of repetition coming in here, and different members saying the same thing does not constitute a new argument. So just be aware, members.

Hon KIERAN McANULTY (Associate Minister of Local Government): Thank you, Mr Chair. In response directly to Mr Court’s contributions, many of the issues that were raised have been addressed already in this committee stage. But we finally got to a question and the answer is no.

To complete the response to Mr Bayly’s contribution—apologies, there were just a couple of matters I wanted to look into in more detail for you. The first bill does contain a process to allow councils and establishment entities to work through water services assets and liabilities. But specifically to the transfer arrangements, that will be included in the second bill.

SIMON WATTS (National—North Shore): Thank you very much, Mr Chair. I want to traverse four aspects in the questions I’ve got on this part. The first is in regards to the Minister’s Supplementary Order Paper (SOP) 306 in regards to new clause 5A in Schedule 1. I asked a number of questions in regards to whether this is a clarification or a change—these answers have not been provided to date—and whether the actual comments made by the Minister in terms of providing clarity of assets that have a primary purpose or—and we’re now using the term “predominantly”, and I appreciate that those words can be used interchangeably, but can we clarify what that looks like, and what advice has the Minister got from the Department of Internal Affairs (DIA) in regards to the parks and reserves that would be deemed to be clearly out of scope and clearly in scope. But, in particular, I’m interested in the advice from DIA around those that are in effect in a grey area, because I think it’s fair to say that there is a lot of confusion in this specific point, and I appreciate that the key reasons why the Minister has tabled an amendment in order to try and clarify that would be appreciated.

The second point that I wanted to raise—

Nicola Grigg: Mr Chair.

SIMON WATTS: —I acknowledge the enthusiasm of my peers, but please give me three more minutes—is in regards to my SOP 289, something that we haven’t discussed today, in regards to changes to clause 6. What I’m tabling here is the opportunity to quite simply remove the confusion and lack of clarity that has been created by the inclusion of the two aspects around overland flow paths and green stormwater infrastructure as part of the stormwater network. I’m sure other members will get into detail in their respective regions of where that complexity lies, but drawing a clear line, particularly around transport corridors, farming environments, it is very, very challenging, and think this is going to the heart of why there is such a degree of confusion. The quite simple way when you look at it is that these assets will be transferred into entities, and I think then the concern that Kiwis have is that these mega-entities are co-governed and Kiwis don’t like that, and that the democratic accountability model around the governance of those entities also has issues. So I’d like the Minister to make comment in regards to my SOP in regards to changes to clause 6 and the definition around “stormwater network”, and provide a little bit of context around that.

I want to move into an area that we haven’t discussed yet, which is in regards to clause 11 of Schedule 1, which relates to Part 1. It relates to an SOP that I have on the Table, SOP 301. This SOP, in effect, removes the provisions requiring territorial authorities to comply with the water services entities. The reason I have put forward this amendment is that right from the outset, whether it was intended or not, the intention was that the central government should be working with local government in regards to the implementing of reform in this regard. And we will recall that right from the outset, originally, there was the ability for councils to opt in to this legislation, and then quite rapidly when the Government determined that the vast majority of councils and Kiwis were against this reform, they changed that and it was mandatory to be in the scheme. So my SOP is removing clause 11 from Schedule 1. All those involved with these reforms were originally, particularly councils, very much under the premise that they should be able to opt out, and I think that’s a key element that should remain in the legislation.

The bill contains provisions, obviously, that require councils to undertake work for water services entities, but councils are under a lot of pressure across this country and so my amendment provides options to councils to not be mandatorily forced to undertake work that should be optional. So if Labour are so confident in their reforms and they think that everyone’s bought into these reforms, they should support my amendment and make it allowable for councils to voluntarily contribute to this.

Hon KIERAN McANULTY (Associate Minister of Local Government): To address the concerns raised by Mr Watts, the changes proposed in the Minister’s Supplementary Order Paper will clarify—by including in clause 5A, “Guiding principle for treatment in allocation schedule of secondary water services assets or property”—a provision which states that secondary water services assets or properties whose predominant use is not the delivery of water services are actually listed in as “should not transfer”.

To directly address the query around Mr Watts’ SOP, on clause 11, this clause concerns the transition of critical infrastructure, the very thing that his colleague Mr Bayly was imploring us to make sure went smoothly.

GLEN BENNETT (Labour—New Plymouth): I move, That the question be now put.

Hon EUGENIE SAGE (Green): Thank you. Thank you, Minister. I don’t think the Minister has answered Mr Watts’ questions about clause 11 and also clause 12 in relation to the two Supplementary Order Papers (SOPs) that he has put in. The Green Party will be supporting those two SOPs, because there’s a very broad commitment in clause 11(1) that “During the establishment period, a local government organisation must co-operate with the department and any relevant water services entity to facilitate the … reform.”

Now, we are aware that the Minister has gone round, has visited, and has engaged with local authorities all over the motu. There needs to be a good relationship between local authorities and central government—one of partnership where they each respect each other’s responsibilities. It seems to the Greens that this clause and also clause 13, which allows the chief executive (CE) of the Department of Internal Affairs to issue directions of non-compliance, are fundamentally changing that relationship in having central government, in a very directive way, telling local authorities what to do. We want this reform to work. It will work when the two partners—local authorities and central government—engage well, and it seems that clause 11 and clause 13 are really undermining that relationship.

So I would encourage the Minister to properly answer the questions: why doesn’t the Government consider that, given the earlier undertakings that the reform would be voluntary, an SOP which removes the ability of the CE to issue the direction of non-compliance and actually makes it much more of a cooperative relationship, rather than a command and control one, has merit in helping reduce some of the concern about this change process?

NICOLA GRIGG (National—Selwyn): Thank you, Mr Chair. I just want to turn the Associate Minister’s mind to some comments made by the lead Minister earlier. So I know that this is new ground to canvas. The Minister, when I asked some questions around the definition and provision of green stormwater infrastructure, my questions were wide ranging, there was a lot to canvas, but the Minister, in her response to me, indicated that there was room to negotiate, particularly around “mixed-use assets”, as she described them. When I asked the question around who would have the overriding responsibility for the management of services whereby you have crossover of various territorial authorities, or a Government agency or, indeed, the new entity deed, speaking with a particular reference to the South Island, who would manage those water services in those vicinities where there’s a lot of crossover, her words were, she said, you know, that it would depend on—she acknowledged that there were some mixed-use assets and that it would depend on what was the predominant use. So I think that in a bill that is creating such enormous transformational change, there does need to be some very, very definitive clarification as to the hierarchy of decision making and funding processes, contractual processes, and procurement processes. She also said that the councils—and again I quote—“Councils can negotiate with the entity on a case by case basis.” So, again, I’d ask the Minister, can we have some clarification as to what those case by case bases might look like, particularly in reference to clause 6 of Part 1.

And then finally, the comment that I’m really interested in having teased out was that territorial authorities will identify which infrastructure will transfer to entities. Well, therein lies the crux, I think, of the opposition to this bill—that the vast majority of territorial authorities and, indeed, regional councils across New Zealand have objected to the transfer of these assets and of this infrastructure. So, therefore, we now have a Minister in the Chair not 30 minutes ago saying that territorial authorities will identify which infrastructure will transfer to entities. What is the rationale behind that? What is the rationale that a territorial authority can use to negotiate and discuss with the new entities as to which assets will transfer? If I look further down the track, wherein does that funding mechanism step in? If the territorial authority agrees and—sorry, negotiates and agrees with the entity that they will manage the ongoing maintenance and upgrade of existing infrastructure, then where does effectively—who pays, is what I’m trying to say in a roundabout way? Where is the line drawn? So I would appreciate some clarification around those areas, please, Minister.

GLEN BENNETT (Labour—New Plymouth): I move, That the question be now put.

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

Ayes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Motion agreed to.

CHAIRPERSON (Greg O’Connor): The question is that the Minister’s amendments to Part 1 set out on Supplementary Order Paper 306 be agreed to.

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

Ayes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Amendments agreed to.

CHAIRPERSON (Greg O’Connor): Simon Watts’ amendment inserting a new clause 3AA set out on Supplementary Order Paper 304 is ruled out of order as not being a serious amendment.

Simon Court’s amendment deleting clause 4(4) set out on Supplementary Order Paper 305 is ruled out of order as being the same in substance as a previous amendment.

Simon Court’s amendment to clause 6, deleting the definition of “Te Mana o te Wai”, set out on Supplementary Order Paper 305, is ruled out of order as being contrary to a previous decision of the committee.

The question is that Simon Court’s remaining amendments to Part 1 set out on Supplementary Order Paper 305 be agreed to.

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

Ayes 43

New Zealand National 33; ACT New Zealand 10.

Noes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Amendments not agreed to.

CHAIRPERSON (Greg O’Connor): Simon Watts’ amendments to clause 4 set out on Supplementary Order Paper 283 are ruled out of order as being the same in substance as a previous amendment.

Simon Court’s amendment to clause 4 set out on Supplementary Order Paper 290 is ruled out of order as being the same in substance as a previous amendment.

The question is that Simon Court’s amendments to Part 1 set out on Supplementary Order Paper 293 be agreed to.

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

Ayes 43

New Zealand National 33; ACT New Zealand 10.

Noes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Amendments not agreed to.

CHAIRPERSON (Greg O’Connor): The question is that the Hon Eugenie Sage’s amendments to clause 6 set out on Supplementary Order Paper 286 be agreed to.

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

Ayes 53

New Zealand National 33; Green Party of Aotearoa New Zealand 10; ACT New Zealand 10.

Noes 64

New Zealand Labour 64.

Amendments not agreed to.

CHAIRPERSON (Greg O’Connor): The question is that the Hon Eugenie Sage’s amendments to clause 6 set out on Supplementary Order Paper 307 be agreed to.

Amendments agreed to.

CHAIRPERSON (Greg O’Connor): The question is that Simon Watts’ amendments to clause 6 set out on Supplementary Order Paper 289 be agreed to.

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

Ayes 43

New Zealand National 33; ACT New Zealand 10.

Noes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Amendments not agreed to.

CHAIRPERSON (Greg O’Connor): Simon Court’s amendments to clause 6 set out on Supplementary Order Paper 291 are ruled out of order as being contrary to a previous decision of the committee.

The question is that Simon Court’s amendment to clause 6 set out on Supplementary Order Paper 295 be agreed to.

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

Ayes 43

New Zealand National 33; ACT New Zealand 10.

Noes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Amendment not agreed to.

CHAIRPERSON (Greg O’Connor): The question is that Part 1 as amended stand part.

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

Ayes 76

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Part 1 as amended agreed to.

Part 2 Water services entities

CHAIRPERSON (Greg O’Connor): Members, we now come to Part 2. This is the debate on clauses 10 to 114 and Schedule 2, “Water services entities”. The question is that Part 2 stand part.

Hon NANAIA MAHUTA (Minister of Local Government): I welcome the debate on Part 2. It is a substantial part of the bill which seeks to establish the four water service entities; outline their role, their purpose, their functions, the ownership structure and allocation of shares, but also the Minister’s role; and the establishment of the regional representative group, the regional advisory panels. This is important because we want to ensure that local decision-making is reflected through this particular system.

It also includes clauses in relation to constitutions which will guide the way in which each entity will operate, and it provides sufficient flex in order for bespoke aspects of each entity region to reflect itself in its establishment. It also sets out matters in relation to the board that is consistent with the Crown Entities Act, and also relevant disclosure requirements therein.

I want to just turn briefly to some of the matters that have been raised, and use this also as an opportunity to clarify the nature of the ownership interest. Firstly, can I say that clauses 15 to 16 establish the council shareholding arrangement under the bill. There was a concern from councils that the term “share” was misleading, and I should say that’s because councils were concerned that the public would think that they had more influence over the entities than is provided in the bill.

Indeed, entities will own the assets. However, councils will own the entities—and through the governance role that we’ve provided, they will direct the entities to conduct their ability to operate water service delivery.

There was also a concern from smaller councils and those kinds of councils where their populations spill over holiday periods. I’m thinking of my own area of the Thames-Coromandel District Council. In terms of the shareholding population—and I would welcome the input of select committee members—in terms of these types of councils, they were concerned that a shareholding based on the usual resident population might have a perverse effect on the benefits that they may get. But can I say this: the whole point of scale and aggregation is to assure small communities—such as the Thames-Coromandel district—that they will reap the benefits of an aggregated approach to the way in which procured services to invest in infrastructure can take place.

The shareholding model—and I’d just like to make a point—was a matter that came out of the governance working group. They decided that because the shareholding was based on population—so 50,000 people and less—those council areas would receive at least one share. They would not be able to take a dividend that the benefits of this reform would continue to reinvest back into the service delivery infrastructure investment component. So there was quite a thorough consideration of these matters within that particular working group.

Let me come briefly to an issue which has occupied much of the time by members of that side of the House, and it is in relation to the regional representative group. Many of the councils in the early stages of problem identification—when we thought about what a solution could look like—made the point that they have existing relationships with iwi mana whenua as a result of Treaty settlement arrangements, that any reform going forward shouldn’t lose sight of the positive working relationships that they have with iwi mana whenua.

So at its core, on the regional representative group, you have a joint decision-making opportunity by having councils and mana whenua across an entity sitting side by side, talking about the way in which they can make decisions for the betterment of their communities to assure themselves of safe drinking water, better environmental outcomes, place making, and offering the ability to look for the very first time about common interests, working cooperatively and collaboratively—joint decision-making.

So I reject strongly views that have come out from one part of this House that propose that having joint decision-making at a strategic level in the way that we’re proposing for water service delivery will not benefit communities. It will; we’ve already seen it in practice. For those many councils who cherish the relationship that they have with their iwi mana whenua, this bill affirms that.

SIMON WATTS (National—North Shore): Thank you very much, Mr Chair, and thank you, Minister, for providing an overview in regards to Part 2, which, as the Minister has articulated, is the most substantive portion of this bill. We’ve got a number of areas that we’re going to get into in terms of questions on this part. But I think it is important, before we get into that, to just stand back and look at the concept around some of the key areas and challenges that have been raised in terms of opposition of this legislation, and they fall squarely as part of Part 2 of this bill. Right from the outset, in terms of the establishment of the four-entity model, while we didn’t discuss that in the prior part, the concept of how it was landed upon four entities and the significant pushback across local government across the country, around that structural model, has been well defined.

The Minister referred to clauses 15 and 16, around ownership shares, and I think there will be a number of aspects that we will want to get into detail around that specifically, because I think that also has created quite a significant amount of, I guess, confusion and clarity on one side, but also unmet expectations in terms of, you know, if you believe you own something, do you genuinely own it? That’s where the confusion has come, in that regard.

The aspects that I particularly want to get into first up is in relation to clause 27 of Part 2, “Subpart 4—Regional representative groups”, which is around the “Establishment and membership of regional representative group”. The Minister’s just stood up and talked about this concept of joint decision-making. Well, it’s not joint decision-making. Joint decision-making is a new term that is being introduced. But for those that are not over the detail in terms of how these groups will operate, half of the seats at the table are mana whenua - appointed and appointed by mana whenua; half of the seats are in regards to the territorial authorities. And there’s a number of challenges in regards to both of those aspects. But that group, in order to make decisions, needs a 75 percent majority.

So, you know, let’s be clear. If there is opposition in regards to that—and that’s well and above the 50 percent threshold, which I think you would infer from when you refer to words such as “joint decision-making”, that, basically, is going to result in one of those two parties, or a number of members within that group, having the ability to influence and control decision making. And our view is that complexity that comes from that governance model is going to increase the time it takes to make decisions; it’s going to add bureaucracy and additional cost, and that’s before we even get into the concept of have we got appropriate representation around the table that represents our local communities across our regions and provinces and cities. And the clear view from this side of the House is that we don’t have that.

So my Supplementary Order Paper is No. 287, and it amends subclause 27(2). The amendment is specifically in regards to the composition of those regional representative groups to ensure that every territorial authority is represented in those groups. Some of the significant opposition that we heard through the select committee process from councils across the country was around the fact of that loss of local voice, and we’ve heard that throughout. So my amendment is dealing specifically with ensuring that all territorial authorities have the ability to be represented across those groups. And some councils, as I’ve said, have raised concerns that they’ve been shut out of that debate, and I think that’s absolutely fair and genuine, and my amendment, in regards to clause 27, will in effect allow that representation. I think it’s important to say that this amendment is not going to affect the ability for the entities to have boards larger than that number. It simply ensures that at least one seat is available for every territorial authority.

The amendment also adds a provision that territorial authorities can provide a majority of positions on the regional representative boards, which we can get into in a little detail later on. The territorial authorities are the owners of these assets and, therefore, should have the control around those boards to oversee the management of those assets. So I would ask the Minister to consider those modifications to clause 27 as part of her deliberations.

NICOLA GRIGG (National—Selwyn): Thank you, Mr Chair. I actually also wanted to follow up with some of the points that my colleague Simon Watts has very eloquently made, with reference particularly to clause 16, the council shareholding arrangement.

I speak often, and I speak glowingly, of the Selwyn District, which I am very proud to represent. It is the fastest-growing territorial authority in New Zealand. But, going on these figures, with reference to the shareholding arrangements, one share for every 50,000 people—and, going on the most recent census, the population of Selwyn was at just over 50,000. But, as I say, it’s the fastest-growing region in New Zealand and, by the latest figures from the council, our population is actually now at 79,000. So I’m very interested to hear from the Minister a process, an explanation of a process, for the re-evaluation and the reallocation of those shareholdings, because, presumably, the Selwyn District gets allocated one shareholding for, I think, approximately $750 million worth of infrastructure asset that it’s built up. But, then, what capacity or what allowance is given to that extra 29,000—and presumably, if I look at growth predictions, our region will be at 100,000 population within 10 years. So I would like an explanation as to the shareholding allocation, but particularly an explanation as to the scale-up and aggregation—if any accounting has been taken for those very fast-growing regions. I would imagine my colleague Matt Doocey has similar questions to ask, because the Waimakariri is also a very, very fast-growing region.

There is also, regarding Subpart 4 of Part 2, “Regional representative groups”, the joint decision-making process. Now, it is very clear that there are 12 regional representatives per entity, and 12 mana whenua representatives. I’m speaking with particular reference to the proposed Entity D, which will take up much of the South Island. I mean my comments I’m about to make, Minister, with the greatest of respect towards Ngāi Tahu, but I’m very interested in what communications exactly have been had with Ngāi Tahu, as mana whenua of the vast majority of the South Island. Has any conversation been had around the capacity within Ngāi Tahu and, indeed, the specialised capability? I look to the Government’s list of work streams, and I look at the enormous reliance that is starting to feed into public legislation on mana whenua. I look at the Māori Health Authority. I look at ECan, the Canterbury Regional Council. I look at the Selwyn District. I look at the new layer of mana whenua representation on the proposed new Resource Management Act. And I think, my goodness, there is a lot of pressure that is going to be put on iwi like Ngāi Tahu.

I would really like to know what knowledge the Minister has around specifically Ngāi Tahu’s capacity and capability. These are very, very specialised skillsets. Is there the skillset within the iwi? Is there the knowledge? Is there the knowhow to manage these enormous entities, with these enormously complex infrastructure demands, financial demands, future build demands? As you said yourself, Minister, you think that we’re short of $150 billion of infrastructure investment. Well, is there going to be—do you perceive—the capability and capacity within mana whenua, and, indeed, the 12 regional representatives, that will be on Entity D? Do you have confidence, going forward, that Entity D is going to be able to meet the expectations that you have of this projected work going forward?

PENNY SIMMONDS (National—Invercargill): Thank you, Mr Chair. I want to canvass clause 16, the allocation of shares in water services entities, and also clause 32 and 33. We have talked about the allocation if the population is not more than 50,000, and my concern is that we are going to see small local authorities such as, for example, the Gore District Council, who are going to feel completely disenfranchised from this process in that there will be ratepayers in those small councils who are paying not insignificant amounts. Farmers there are likely to be paying rates of $5,000, $6,000, $7,000 per annum, and will feel that they will not have a voice at this table. It’s a very unusual situation to be in, to be the owner of assets where the value will be in the millions of dollars—to be the owner of those assets but to literally have no voice, or such a small voice, at the table that they will be disenfranchised from the decision making.

It’s also a very unusual thing—and I know that the Minister has spoken about the partnership model, but it is a very unusual situation for owners of an asset to not have a majority say in the strategic use of those assets, which clauses 32 and 33 bring about. It is, I guess, part of the move from this being a voluntary opt-in to being a compulsory requirement to be in that it makes the shareholding proportion all the more important, and I think it is probably at the root cause of why so many local authorities have become so staunch on opposing this as they feel their voice is going to be so diluted.

And looking at the partnership—and, again, I refer to the comments my colleague Nicola Grigg made about Ngāi Tahu covering such a broad geographic region—there doesn’t seem to be anything in the method of appointing mana whenua representatives that might require that the mana whenua representatives actually have any knowledge of, or affinity to, or affiliation with, that geographic spread. So, for example, for the North Island entity, the mana whenua representatives could arguably all come from the Canterbury region and have very little, or no, knowledge of the assets and the issues that might be occurring around the Gore region or the western Southland region or the Queenstown region. So I’m really struggling to see how (1) that voice of the local people is going to be given effect to, and (2) that seems to be actually exacerbated by the appointment process of the mana whenua representatives not actually having any requirement to have that geographic spread either.

So I’m interested to hear from the Minister how she believes the shareholding model, based on population, is actually going to give voice to those very small local authorities such as the Gore District Council, with a population of around 8,000, but with people in that that are making quite significant rates payment that are going to, obviously, impact on the assets that that authority holds. Thank you.

Hon NANAIA MAHUTA (Minister of Local Government): Let me cover off some of the issues in relation to a genuine concern that the Finance and Expenditure Committee took note of which was small communities being outflanked by larger communities. I welcome the addition and the strengthening of the legislation to ensure that we get a representative mix of the rural, provincial, and metro communities on the regional representation group. Articulating that very clearly in legislation makes clear the obligation that the legislation has towards ensuring more local voice.

The other element in relation to the regional representative group was a matter that Ms Grigg raised, which was will there be capacity across the whole of the representative group, namely iwi mana whenua partners to contribute to this process. I suspect, just like councils, it’s a new domain of decision making that they’ll be entering into, that they’ll develop a relationship, and that they will build capacity over time in order to undertake the objectives of the regional representative group, which is to develop the strategic documents that will guide the water service entities, which will be to put through some rigour, the asset management plans and the pricing and funding plans that will give the assurance to their communities about the role and function of the water service entity to carry out the purposes that it was designed to do.

The other element, and I think that’s an important question to come back to, is around population growth. This was something I raised also in my opening statements around this. For those small communities who currently sit at about 50,000 or less, they receive one shareholding vote. But if I draw the member’s attention to clause 16(2), outlined in there is that every time there’s a census and the population adjusts, so will the shareholding. There’s a process for which that can be calculated and determined. So I think that’s a really important function to give communities confidence that in those growth areas the nature of the interests, the shareholding interests, can be taken account of. But I still maintain that setting up a shareholding interest based on population, where there’s no ability to take a dividend, will give small communities greater assurance that the establishment of these water service entities and the commitment to reinvest back into infrastructure will see the benefits in those areas that the member referred to, that I referred to in my own electorate, that many of us are worried about because we know that they cannot afford the level of investment and infrastructure that is required to underpin their existing needs of the water network, but also their future needs if they see themselves as a growth area.

I also want to come to the matter of the point that Mr Watts raised in relation to the membership of the regional representative group and every council should be represented. One of the concerns that I have, and I know that this was something that the select committee took very seriously and I feel obligated to raise it in this Chamber, is that if the regional representative group became too unwieldly too quickly—that is too large—and if we see in some of the entity areas where you have up to 21 or 22 councils and then immediately the representative group starts out with that number, the conversation right at the front end of a reform agenda will be: who’s there? It’ll be around representation. This has been tried and tested. I have some level of lived experience to make this comment because I know that in many iwi post-settlement entities, post-settlement governance entities, one of the biggest challenges, if you have a governance entity that is far too large, it in some ways hinders or impedes the ability to make the strategic decisions or even have the strategic conversation that’s necessary to guide and govern significant interests. So I’m not saying that the concern isn’t valid; I’m saying that we need to balance the legitimate interest of ensuring that councils and iwi mana whenua can contribute to the strategic decision-making but also stage out the way in which this happens because we are at the front end of a new reform and changing the way that we’re delivering water services across the country. I hope that they value the opportunity to start well, start with the intention in mind, which is provide strong strategic guidance to the water service entities to do the job they’ve been tasked to do.

SIMON COURT (ACT): Thank you, Madam Chair. I want to ask the Minister some questions about the operating principles in clause 13. Now, the operating principles of these proposed water services entities, the first couple of them are actually quite reasonable: develop and share “capability and technical expertise with other water services entities and throughout the water services sector”. Respectfully, Minister, that’s quite condescending. Water companies like Watercare, the engineering consultancies, and the contractors who support the delivery of water services develop and share capability and technical expertise with each other all the time. That’s what the sector does. Then we come to clause 13(b), “being innovative in the design and delivery of water services and water services infrastructure”. Minister, that’s called civil engineering. Innovation is something that we do when we design and construct infrastructure. Clauses 13(a) and 13(b) are condescending, but ACT can live with that because the 10 ACT MPs have got used to sitting across the House from this Labour majority—we know what condescending feels like.

Hon Andrew Little: It’s mutual.

SIMON COURT: And Mr Little acknowledges that. Now, I want to take the attention of the committee, and for those people that I know are watching this debate closely I want to acknowledge those people, because they realise how important it is to the future of New Zealand that the flaws with this legislation are exposed, whether they be the flawed funding and financing model or the balance sheet separation claims. Standard & Poor’s advised Department of Internal Affairs officials that this would be a high-risk, highly leveraged transaction and that without Government backing—in other words, there is no balance sheet separation—they would have a B credit rating, Minister, a B credit rating, which is one level above junk bond status.

So, look, there are many, many flaws with this bill, but I want to come to this one, clause 13(d), which requires these entities to partner and engage “early and meaningfully with Māori”, including to inform how water service entities can give effect to Te Mana o te Wai—those statements which only iwi and hapū are able to provide to water services entities and which can be all-encompassing, from the top of the mountain to the river mouth and beyond, we know, and include geothermal resources.

Now, clause 13(d)(ii): “understand, support, and enable the exercise of mātauranga Māori, tikanga Māori, and kaitiakitanga”. Well, what ACT proposes is water service entities, if they are to be created by this piece of legislation which this condescending Government no doubt will ram through at some point today or in the next few weeks—ACT proposes, in our Supplementary Order Paper 292, to amend clause 13(d) of this bill. Rather than just giving special rights to a group of people based on who their grandparents were, “partnering and engaging early and meaningfully” should be with all affected communities. That means communities who rely on the supply of water, whether it’s through an irrigation scheme for agricultural purposes, which this bill will now include, whether it’s to access geothermal resources to make renewable electricity, or whether it’s to get water from municipal supplies so that you can run your business, so that you can manufacture food, so you can manufacture steel products, for example, things that go into construction like water, which is needed to make concrete, Minister. So, Minister, I’d like you to respond to my question: why on earth is it that water services entities will only be required to take account of Te Mana o te Wai statements provided by iwi, hapū, and people whose grandparents might have been Māori, but not with all affected local communities, which include people who produce things like food, like concrete, and so forth?

Minister, would you take a call and respond to my question on clause 13(d), “Operating principles”—why you think a certain group should be given these specific rights over other groups.

MATT DOOCEY (National—Waimakariri): Oh, good choice, Madam Chair, and, first, can I congratulate you with your ascension to a presiding officer. I know you’re a member with huge integrity that you’ll bring to the role, so congratulations. Well, let’s start with Part 2. Part 2 is a very interesting part of this bill, which talks about the water services entities, because, really, when you start thinking about what this reform is going to look like, there’s nothing more jarring than thinking about these four mega-entities. Already, Kiwis are very concerned about a similar model being rolled out through their health system, which has resulted in absolute failure. It is interesting, when you look at clause 11, the changes in the select committee: the objectives of the water services entity have gone from “deliver water services and related infrastructure” and been changed to “own and operate water services infrastructure”—own and operate water services infrastructure. I’d argue that especially for the residents I represent in Waimakariri, that will send a chill down their spine, that we are debating in this clause mega-entities that will own their water assets. Let’s be very clear: this part that we’re debating now and we’ll be debating for some time this afternoon will actually legitimise the forcible seizing of local ratepayer assets.

So there is a question of why these water entities need to own and operate, and if we look at clause 15(2): “A water service entity is co-owned”. Why would Waimakariri ratepayers be happy to move from single ownership to now co-ownership? How is the dilution of their ownership going to result in better-quality water assets? I’d be very interested to hear from the Minister in the chair, Nanaia Mahuta, why she thinks a council that already has very high-quality water assets and is delivering very high-quality water is now going to gain by diluting its ownership into co-ownership.

Then the second question around the issue of ownership: does the Minister think that she has been listening to those councils? Of course, when we had the three mayors stand up in Auckland—Mayors Gordon, Mauger, and Brown—the Prime Minister said, well, actually, she was open to listening. So does she think that her Government is listening by ignoring their pleas to retain single ownership and go into a co-ownership? What was the point, I suppose, of sending out the Associate Minister on his trip to all of the councils—where he got a very clear message: great guy but wrong party—who said that they were going to listen.

Let’s be very clear: clause 11 of Part 2, that we’re starting this debate on, has been changed in the objectives of the water services entities, which originally were to “deliver water services and related infrastructure” to now going to “own and operate”, and not only own and operate but, with clause 15(2), a water services entity is now co-owned. So councils will go from single ownership to co-ownership. Does the Minister feel that is good faith and right when councils were led to believe that they could opt in to this reform? As we know in Waimakariri, they went to their ratepayers: of those who responded, 95 percent wanted to opt out. Now we have a legislative all-in: mega-entities that we’re debating in Part 2 that are going to take over ownership and dilute ownership from councils. I think most listeners and viewers at home will be extremely concerned by what, basically, is State theft by stealth.

Hon NANAIA MAHUTA (Minister of Local Government): That last statement of the member is simply not correct. If anybody in this House accepts that kind of statement, (1) they haven’t been listening to the thorough considerations that have taken place over the five years through the various modelling of this Government in coming to this reform; (2) they have not taken on board the select committee report, of which they got a condensed amount of information in relation to the policy drivers and the modelling that’s occurred and the submitters; and (3) they believe that their own rhetoric will in some shape or form lead an alternative solution, because there is no alternative solution.

Hon Member: Not true.

Hon NANAIA MAHUTA: Can I just—yeah, well, it’s a statement of fact. [Interruption] Sadly, it is. But let me just draw the attention of the committee to what the member is proposing based on his own local council and a set of modelling that had some clear deficiencies, because we know that the Communities 4 Local Democracy based much of their proposition on the Castalia report, and there were some clear deficiencies in that particular report. One of them was that they—well, there are a couple of things in the proposal that should give people cause to consider what the alternative is that is being proposed on this side of the Chamber. Firstly, those councils that were part of that group wanted time to develop their own set of arrangements. The difficulty with that is that there will be significant variability across the country in what those arrangements could look like. It sounded, in some ways, like councils wanted to choose who they wanted to work with without a real sense of what the equitable benefits would be across regions and districts. That’s a worry.

The other element was that the Castalia report, through scale and aggregation, didn’t even factor in the procurement benefits that could be derived from the model that we have in front of us. That was a deficit. The other element was that it ignored significant case studies around both Wellington Water and Watercare, and the lessons that we’ve learnt from just our own experiences of where councils have got to, either through existing legislation or through cooperation. There is learning from both the Wellington Water and the Watercare model that we should not ignore, and we should say, “OK, if this is as far as councils can get cooperatively, what more do we need to do to ensure that New Zealanders as a whole, both ratepayers and taxpayers, can benefit from a reform agenda?”

That is where this Government is taking us, to the broader benefits of moving through reform, taking on board the lessons that we have within our own country context, drawing on comparative research, and then offering up bespoke opportunities for the New Zealand type of model, which is why we have, for example, Te Mana o te Wai considerations, the ability for councils’ existing arrangements around joint decision-making, especially when it comes to natural resources to be factored in, and when it comes to a really strong sentiment that many councils actually supported, which was a public model of water service delivery which rejected privatisation. I’ve gone to read many of the submissions here, and many feel very strongly about a non-privatisation agenda; these are councils. We need to take on board that consideration as we thoroughly and robustly debate the rest of the issue. So I really wanted to put that on the table.

Can I also highlight, in relation to local voice, that that is the reason why the Government’s Supplementary Order Paper strengthens local voice in a number of areas—but let me point to one for the purposes of the debate that’s come up in the committee. We want the ability for entities to use the establishment of regional advisory panels to take decision making closer to the community of interest so that that local voice can come through, so that those voices can contribute to the formation of the strategic documents that we’ve been referencing in the House. That is going to be an important element and addition to strengthening the model that we have, that keeps faith in the community that we’ll do something about it.

On the engagement provisions, this bill does not merely ensure that Te Mana o te Wai obligations are engaged upon; it’s also making regulations for a constitution and decisions relating to joint venture services and entity arrangements, and also in relation to the creation of statements of intent, asset management plans, funding and pricing plans, infrastructure strategies. Those are all the areas within the bill that there are engagement provisions that enable us to ensure that not only local voice is listened to but they are contributing to the direction and the operational challenge that these water service entities will have.

SIMON WATTS (National—North Shore): Thank you very much, Madam Chair. One cannot stand by and hear a statement from the Minister in which it’s quite clearly outlined that there are no alternative models. I’m unsure of the words to use to describe that but it’s simply not factual on the basis that Communities 4 Local Democracy tabled an alternative model that was independently peer assessed. It was supported by over 32 councils. It articulated a pathway in order to achieve local ownership of these assets to ensure that the capital that needs to be invested would be invested and it wouldn’t have these significant implications. But for the Minister to stand up and say, as she did just then, that there are no alternative models just simply amplifies to Kiwis around the country why this Government is simply not listening to the feedback in regards to this reform. That is deeply challenging for Kiwis across the country. To simply say—irrespective of the model put forward by the Auckland mayor, the Waimakariri mayor, and the Christchurch mayor—that there is no alternative is just not based on fact.

I’d like to get back to clause 27, in Part 2, which I noted before in regards to my Supplementary Order Paper (SOP) 287, and I’d started to provide an overview. At the heart of the opposition to this reform is that fact that this clause imbeds 50:50 co-governance over water services entities across this country. This is one of the single most fundamental elements of opposition, lack of clarity, challenge and questioning across this country without doubt. We’re not here to argue around the detail in terms of what that role would look like but the simple failure of this Government to bring all Kiwis with them on a reform agenda to articulate the reasons why this is so critical and why this will deliver benefits that we’re unable to achieve under the current state. The failure by this Government to bring all New Zealanders with them on this journey is going to be the single most fundamental element of why this legislation, under a future National-led Government, will be repealed. That is categorical.

My amendment around clause 27 relates to ensuring that territorial authorities make up the majority of the positions on those regional representative groups. Why? Because those individuals are democratically appointed by their communities to manage their community’s assets. Communities and local government are best placed to deal with local issues, and National absolutely respects representation from mana whenua at that table, and my amendment doesn’t take it away. The National Party absolutely respects and desires that mana whenua have a seat at the table alongside others in our community, and that is the simple difference here. But the voices around that table need to be reflective of the fact that the territorial authorities actually have the control of the assets within these water services entities.

So I ask the Minister to reflect on the significant opposition that we’ve had across this country over the period of this reform agenda that’s been on the table. We’ve had significant submissions. I’ve heard the comments saying there wasn’t too much opposition in the submissions received by the select committee. Well, that is absolute nonsense—absolute nonsense. If I table the form submissions by both the National Party, the New Zealand Taxpayers’ Union, and other members across the House, the issue of co-governance and the opposition around 50:50 co-governance is squarely within that. It’s just that the select committee decided to treat those submissions as one submission. But that doesn’t take away from the fact that nearly 88,000 Kiwis across this country took the time to submit their feedback and opposition. So that is a great shame.

I’m going to move to another clause, but I’m conscious of the time. I want to move to clause 45 in Part 2, and this is in my SOP 288. This SOP makes amendments in regards to clause 45, and this is moving into the sphere of the regional advisory panels. For those watching at home—and it’s coming up to morning tea, so I hope you’ve had a cup of tea—we’ve talked about regional representative groups and we’re now talking about regional advisory panels. The amendment I have put forward in regards to these regional advisory panels is to remove the requirement that there is an equal number of mana whenua and territorial authorities sitting at that table and instead make the change consistent with the change I’ve noted in clause 27, that the majority of seats around that table are comprised of representatives who represent our local communities, our local councils, and our territorial authorities.

Surely that is common sense in regards to the way in which we should be managing our water assets. It does not take away that fact that mana whenua will be at the table—absolutely not—but it ensures that the majority of seats around that table are made up of individuals who are democratically elected and represent our communities on behalf of the territorial authorities, whose assets are the assets that will be transferring into these mega-entities. And we can traverse later on about those assets and the ownership components of that. But I think that is absolutely a reasonable change, and I think that goes to the heart of some of the most significant opposition to this bill in the public arena—the fact that this position by the Government, whether it’s ideological or what, is that we have to have 50:50 co-governance and not only that but the fact that that group then has to have a 75 percent voting majority. In effect, either group or a small number of groups has the ability to veto any single decision. And in an asset as important as water, we need to make sure that we are working with our local communities and not against them.

So the amendment that I’ve put forward ensures those voices around the table in regards to governance of our water assets and that the control remains with territorial authorities, and respects that democratic element of our democracy around it—that representatives at our territorial authorities and local government are democratically appointed and accountable to the public for the decisions they make. Every three years they’re at the ballot box and that is very reasonable. But the fact is that those individuals around the table must have the control around the table in order to ensure that we are both planning and delivering and executing the sustainable change required for our water infrastructure across this country. Those individuals within their local communities are best placed to be able to contribute around that table in order to make decisions on behalf of their communities, who own these assets.

These assets have been contributed by ratepayers over decades and decades. The assets are owned by our local communities. They’re not owned by central government. This asset grab of simply moving all these assets into these four mega-entities—the heart of this reform—is the reason why the National Party remains strongly opposed to this model and does not believe that this model that’s currently on the table will achieve the outcomes we require not just now but 10, 20, 30, 40, 50 years out. We need a sustainable solution—one that is bipartisan but one that all parties agree to. But this Government to date has failed to listen to the feedback on the table, and that is a great shame.

So I ask the Minister to give thought to the amendments I have raised in SOP 288 and also in SOP 287. I ask him to give the due consideration or—if he does not—to outline to Kiwis around this country why this Government is not willing to make changes around the fundamental premise that this bill embeds—that the Government believes it requires 50:50 co-governance of water assets across this country. I want him to make it very clear why Kiwis are not right in regards to their opposition. I want him to be clear around why the Government believes they know best. I think New Zealanders deserve that comment from the Minister to articulate what I believe is one of the most fundamental issues with this bill.

Hon NANAIA MAHUTA (Minister of Local Government): The last contribution of that member Simon Watts would make some people listening to this debate think that Māori aren’t ratepayers and they’re not taxpayers, but they are. That is the reality. In many communities around the country, Māori are ratepayers.

But this isn’t a binary issue between Māori and everybody else; this is an issue about how do we provide safe drinking water, how do we achieve better environmental outcomes, how do we have water reform that enables a financially sustainable ability to fund water infrastructure which is a significant core asset. We’ll do that through scale and aggregation separating balance sheets. We’ll do that through ensuring good governance. We’ll do that through ensuring that the Crown’s Treaty obligation is built into the reform process. We’ll do that by ensuring that there is no privatisation. So shareholding interest does not equate to a dividend which makes it easier for privatisation. That is not the way this Government is going. We’re having a shareholding interest that protects the public interest in our water infrastructure network now going forward into the future, but, more than that, we want to ensure that there is local voice baked into every part of the decision-making process, because we know at a time when citizens are facing cost of living challenges, we need an affordable solution for the future.

That member said that there is no alternative model and that he proposes there is. Now, that was unkind of me, and I admit that, because in the three years prior to landing on the model that we’ve had, we tested many of the ideas that have been put up recently in the House by that member, and it looked like this: a scaled-up council-controlled organisation (CCO) model; the potential of a New Zealand Transport Agency type of model, the opportunity to aggregate it to a regional level in varying degrees, and then the opportunity to perhaps look to something that is totally out of the box and somewhat of an innovation between a CCO model and something else. All of those models were tried and tested and they are in the regulatory impact statement that is attached to this reform programme that the public can see and is fully visible to anyone who wants to analyse our considerations. Much of the information that we secured over a long period of time came from councils themselves; they weren’t numbers that were just thought up out of the air.

But this is the thing: the Government had some key priorities that it wanted to ensure could be achieved in a reform programme, in a way that all communities benefited, large and small, because we know that the costs impacting on small communities right now, going forward into the future, with climate change being a real significant impact—let’s look at Westland—needed to be addressed. That’s why the reform approach that we’re taking—and that is in front of you—delivers on all those key fronts: scale and aggregation, making sure we get balance sheet separation, good governance, making sure that our Treaty obligations are upheld, making sure that it is a public model where there will be no privatisation, ensuring that local voice is evident, and that we will deliver now, going forward into the future, greater affordability back to ratepayers.

Simon Watts: You know that’s not true, Minister.

Hon NANAIA MAHUTA: Let’s face it: the growing reality—and that member wants to reject it—is that Māori are ratepayers. In my community—actually, as a result of Treaty settlements—Māori make a significant rating contribution to councils in that area. That is the case, also, in the South Island. It’s not the sole justification for having joint decision-making on the regional representative group, but it makes sense that we take the conversation that those members want to have around ownership and assets towards betterment for the environment, the community; better drinking-water outcomes; and long-term intergenerational objectives to care for our most precious resource, which is water. That is why joint decision-making matters. That is why Te Mana o te Wai is embedded within the framework of this legislation, because we cannot just keep thinking about today; we need to think about tomorrow.

Simon Court: Water’s just a resource.

Hon NANAIA MAHUTA: We cannot think that water is an infinite resource.

Simon Court: It is.

Hon NANAIA MAHUTA: It isn’t. It needs to be cared for in a way that we’re making more efficient decisions and able to invest in the water network and able to adopt green solutions to make our communities more livable and vibrant for our kids and their kids to follow. Again, that’s why we won’t be supporting Supplementary Order Papers 287 or 288 that are being proposed by Simon Watts.

MARK CAMERON (ACT): Thank you, Madam Chair. Minister, in clause 16(1) and (2), I’m trying to reconcile the share system where it says 50,000 people and under are one share. Well, I live in Northland, which you and I have discussed. So you’ve got the Far North and the Kaipara—that’s essentially two shares in that instance. Compare that to Auckland, which is going to have a good ol’ wheelbarrow full of shares. The infrastructure management of water assets in rural New Zealand is fundamentally different from anything that you might consider urban-centric. Waste-water management and stormwater management in rural New Zealand is often funded by ratepayers themselves. They pay for a septic tank. It’s not part of a reticulated scheme. They put a tank—I have rainwater on my roof, Minister. I paid for all of that, and yet here we are. You can see how it turns into, with the previous member before, deep confusion for rural asset owners and the management therein. There’s fundamentally a huge difference in stormwater management in rural New Zealand. It’s heavily weighted—the infrastructure—in terms of investment in rural New Zealand and stormwater management, and I can tell you, Minister, just one anecdote: I had farmer owner operators saying the process of cleaning canals, stormwater management, has been handbraked because they have to identify with cultural sensitivities. In rural New Zealand, someone apparently saw a taniwha there. Now, this is handbraking not only productivity but outcomes for freshwater and stormwater management. Earlier today, we talked about green overland flow. Well, respectfully, Minister, that’s nonsensical when most of this stuff has been managed and owned and nuanced, and all the understanding has been managed by rural New Zealanders. We don’t need this stuff in the country. There are parts of New Zealand—Dunedin, Hastings, Havelock North—that absolutely do, but stormwater and all the confusion at what this means in terms of asset management in rural New Zealand, this undoes. Can you please answer how we as farmers can operate in this lens.

SIMON O’CONNOR (National—Tāmaki): Excellent—it’s always good to have a few Simons in the House. The fundamental principle for me is water is one of those qualities of human life which every human being and animal has an interest in, and that will apply to some of my thinking as I look into Part 2, and just to signal to the Minister and officials particularly around clauses 33 and following, so around the notion of regional representatives.

So I’ll start there, because the Minister’s spoken around scale and aggregation—that makes sense to me. I wouldn’t mind her articulating a little bit about what she understands of the Scottish model, because she’s put a few out there but hasn’t touched on that. But she talked a bit about local voices and good governance, and I wouldn’t mind understanding how she sees good governance manifesting itself in the likes of clauses 41 and 42, where we end up with co-chairpersons, co - deputy chairpersons, and so forth, because good governance relies on clear purpose, well-articulated values, consensus, and clarity. And the more you begin to split things, let alone split based on race, the more complicated things get. So I don’t understand how good governance can be argued when we’re creating quite a convoluted system, including around co-chairpersons and co - deputy chairpersons. That just seems to me to make things far more complicated.

I’d also like to know from the Minister how she can justify concepts of local voice when many, if not all, of the regional representatives are appointed. So this is not done by election; this is done by appointment, and it doesn’t matter if it’s mana whenua or the regions themselves. How is just simply appointing people ensuring a local voice, or one that’s to be held accountable?

What follows on from that is also that in this bill in clause 38, there’s a list of knowledge and experience, which I would argue is quite prescriptive. Again, local voices, I’ve certainly found in my time in Parliament, are rather diverse. There’s a range of views, competing concepts, and so forth. But she’s become quite—well not she; rather, the bill is quite prescriptive, including around the principles of the Treaty of Waitangi. Does she accept that these are not set in concrete? I am someone who disputes aspects of these principles, and I think in a democracy that’s a healthy thing, by the way. There’s a healthy debate—in clause 38(2) it sort of implies that these principles are totally agreed. Again, I just want to put on the record that they are not.

Clause 38(2)(d) talks about the perspectives of mana whenua, mātauranga, tikanga, and Te Ao Māori. That’s all fine and good; those perspectives are welcome. But they are just a perspective; they’re not the perspective, unless the Minister would like to disagree. I’d also like to know why science is not put in clause 38 as one of the aspects which is needed, because science is underpinned. I better be clear here for the people listening: I’m not referring to Western science; that’s identity politics nonsense. Science is science; it’s universal. I would have thought that with the management of water that that would be a key competency that should be placed. So, Minister, what I’m articulating here is, effectively, if we have a local voice, why are people being appointed? Why is there a relatively limited list of qualities required of these committee members, often with an implied singular view? And why is the likes of science missing?

Again, the co-governance—oh, not co-governance, sorry; the good governance suggestion that the Minister made: how does she see splitting up chairpersons and deputy chairpersons as good governance?

And then the last couple of points, because I don’t want to take up too much of the time. Clause 33 talks about appointing mana whenua representatives. If we take that as a given, how is that going to work in the likes of Auckland where there are many who claim mana whenua status, often actually competing. Are we going to see these representatives groups flooded with a number of—sorry, that’s not meant to be a bad water pun. But are we going to see these groups flooded in tensions within the groups themselves—as you know, within any tribal context, regardless of country, there’s going to be, if you will, infighting challenges? How is that going to practically work?

I suppose the final point that I’d like to make—and there’s a lot of discussion, understandably, around co-governance, and I want to return to where I started. Water is something for everyone, and I do understand, as the Minister and others have spoken, the value that the Māori voices bring to the table. I understand Māori—Madam Chair? [Bell rung] Thank you, Madam Chair. I won’t take too much longer. It’s trying to get to the heart of the question. [Member pauses] The anticipation.

Hon Member: What a build-up.

SIMON O’CONNOR: Indeed. Now, where was I going? Māori have absolutely a lot to bring to the table and the Minister’s rightly pointed out they pay rates, but, of course, the corollary to that is just about every New Zealander pays rates. Rates are not based on one’s ethnicity or identity; they all have voices to bring. So I suppose the question I want to put to the Minister, particularly when we have to have this co-governance model, is what is it that non-Māori are not bringing to the table? What is it with a Chinese New Zealander, an Indian New Zealander, an Irish New Zealander—what are we not bringing to the table? OK, so what is it that is extra special? And to use a personal example, what is it about my wife, who’s absolutely wonderful and Māori—what is the extra that she could bring to the table that I can’t?

Now, she probably is because she’s far more intelligent than me and an engineer by training, but, that aside, what is it in her particular quality as Māori that she is bringing to the table? And I think that’s really fundamentally important—it’s really important. As I said at the start, of course Māori perspective, Te Ao Māori, brings qualities, but what’s implied in legislation like this is that somehow it’s bringing things which other groups don’t have, and I don’t fully understand that. I might come from a different culture and concept, but I also understand the value of water to me, to my family, to multiple generations. I just don’t see what the extra is. And I do worry that we’re also moving into the metaphysical side, too—that we’re bringing in sort of belief structures, which I don’t think are particularly helpful. So I’d like to understand that.

Then the final point is really just a statement. Suggestions of privatisation, which continue to be brought up, are basically false flags, and I think those listening need to understand that I don’t think there’s any groups in this House which are looking for the privatisation of assets, and suggestions of that degree are really just something—false flag.

But, anyway, a number of questions and thoughts there, and I welcome the Minister’s thoughts.

Hon NANAIA MAHUTA (Minister of Local Government): Much to the goading of the Opposition, I won’t get involved in a race-led debate, because it’s the wrong debate to be having. And in the context of including Treaty obligations and Te Mana o te Wai in this legislation, as I said, one of the key factors that the Government considered was upholding the Crown’s Treaty obligations. It wouldn’t matter what hue of Government is in place. The National Party and the Labour Party have supported a Treaty settlement process, and falling from that Treaty settlement process are existing obligations that occur with councils in relation to the natural environment. And when we’re starting to craft an approach towards water reform, we could not ignore those existing obligations. Many councils themselves said these good working relationships that we have that are working for us as a council, for our community—we don’t want those things to be lost.

The other thing is that if we lift up those obligations within the context of this reform, Te Mana o te Wai speaks for everybody, but, most importantly, it speaks for the environment, ensuring that we’re looking after water as a sacred resource now going forward into the future.

The principles underpinning Te Mana o te Wai were established in 2014 under Nick Smith, and it included a number of stakeholder groups—the rural community; yes, Federated Farmers; it included industry users; it included horticulturalists, as well as iwi—to try and figure out what was it about Te Mana o te Wai that worked for everybody, but, more importantly, what is it about Te Mana o te Wai that must work for the environment. And that is why it has been brought into this legislation, because it makes sense to treat water as a whole system, not one water, not two waters, not even just three—water as a whole system, from source protection to its use in its varied forms back into discharging into our rivers, lakes, streams, and beaches. And that is what we have here within the context of the reform.

I want to come specifically to the points that that member raised in relation to co-chairs and elements of that and how does that add to improved governance. Actually, what the legislation provides for, through the constitution, is regional representative groups to decide for themselves whether or not they want co-chairs. It isn’t mandatory. And if you read the legislation, it provides that opportunity but it does not obligate or necessitate that that is a consequence of the establishment of the regional representative group. And that is as it should be, because what we need is for these groups to talk to each other, not position themselves and then take a vote.

I mean, I should also say that there was an inaccurate statement raised by a member on that side of the Chamber, who said that iwi mana whenua representatives could, by virtue of a 75 percent vote, stop things from happening. That is not the case. That is only the case if the regional representative group, or, if a matter of divestment or privatisation came up, it is required that 75 percent of a regional representative group, made up of all members on that group, would have to vote in favour of privatisation. Now, we know that is a difficult threshold to meet, and we certainly know that by having iwi mana whenua at the table alongside councils, they absolutely won’t go to that, because they do not want foreign interests involved in core infrastructure such as the delivery of waters. And that’s a total sum benefit for many New Zealanders who also don’t want privatisation.

We need to look to the legislation, the bill, because I think many of the concerns that the member may legitimately have can be alleviated through the protections that much of the form and function in the way that the regional representative group and the regional advisory panels are set out in the legislation, but there is the opportunity for variance through the constitution. And the reason why that is there is because we heard through the design process, and also through the submissions process, that each entity’s slightly different; they’ve got slightly different characteristics and motivations and things like that. But the common aspirations are set out in the legislation, and we just wanted to make sure that we weren’t being so prescriptive that those unique positive factors and characteristics of how an entity wanted to reflect itself in its water service delivery objectives—that that could be achieved through the constitution.

MELISSA LEE (National): Finally, Madam Chair—great choice. I take this opportunity to rise to speak on this bill. It is my first opportunity, and forgive me if I repeat some of the things that other members might have traversed in the Chamber.

But I’ve found it extremely interesting sitting here listening to the Minister talking and starting her answer previously. Her comment was that Māori also pay rates, as if that is an answer to the question that was asked, and she said that she was being race-baited by one of my colleagues. I thought that her very comment that Māori pay rates was, in fact, race-baiting. If that is the case, the answer is: how many non-Māori do not actually pay rates? Are we now saying that if Māori pay rates and they get half the seats, how about the rest of us who pay rates and who do not get any representatives on this board, and what about the territorial authorities who are duly elected and appointed to look after our waters? But they are being told, “No, the Government knows best. We’re reducing your numbers and we will only have four big entities, and we will have equal representatives from territorial authority representatives as well as mana whenua—50:50.”

I can actually say that my background is also ethnic. I come from a Korean background, and I don’t know if many members actually know this, but my surname, Lee, it is actually Yi, but the prefix before the Lee indicates what clan I come from. I am a Gyeongju Lee, and if I come from Gyeongju Lee, my name also gives an indication as to what generation I am. In Korea, we also have clan land issues, so I do actually understand the issue that Māori have in terms of iwi and hapū and the clan land—the land that belongs to the whole hapū and iwi—and the kinds of disputes that go on within the family as well.

When the Minister talked about how the representation was really significant and that it wasn’t—I’m just trying to understand. Do even the mana whenua get true representation when you talk about having at least 60-odd iwi and hapū groupings in the Waikato alone, I think? The territorial authorities number more than 20—I can’t remember exactly how many there were—and if we are talking about having 50:50 seats in this particular grouping on one of the new entities that this bill makes, how many representatives is that going to be, Minister, exactly in the number, and can that number be said to be truly representative and democratic?

The Minister mentioned the democracy issue in this. She actually brought that in. When you consider the fact that New Zealand is supposed to be a democracy, and I sort of feel that this clause, in particular—and I support, honestly, Supplementary Order Paper 287, which Simon Watts has presented. It amends this bill to make changes to make sure of the “composition of the regional representative groups to ensure that every territorial authority is represented in the regional representative group.”, because if we are talking about a democracy—and the Minister said that she has read some of the submissions. When there are more than 88,000 submissions to the select committee and the majority of them actually oppose this bill, I don’t understand how she can honestly say that she has listened to the people who oppose it. Even the councils that she talks about opposed this bill.

The people of New Zealand oppose this bill and we oppose this bill, and I think she should actually take heed of some of the valuable suggestions that members in this committee are in fact making, because it certainly might make this bill better. On sitting here just listening to the Minister, it sounds typical of this Labour Government, as it is the Labour Government who knows best and nobody else can tell them what to do.

SIMON COURT (ACT): Thank you, Madam Chair. We’ve canvassed many issues this morning and last night on this Water Services Entities Bill, and this morning in the committee, Minister Mahuta—in response to a question I put to her as to why only iwi and hapū are able to make Te Mana o te Wai statements, which will direct the water services entities to give effect to those statements—said, “New Zealand’s different.” New Zealand’s different! Well, that aligns quite closely with what another Labour Minister said recently that “Democracy’s different in New Zealand. That’s why we need co-governance and need to allocate rights to groups based on who their ancestors were.” And yet for all New Zealanders, water is a taonga that we share. We have common interests in the resource whether we’re recreational fishers, farmers, people who grow things like fruit and vegetables or livestock, but apparently New Zealand’s different.

Well, we must be quite different, because if we look at the membership of the boards that will be established under this bill, the boards of water services entities, if we come to Subpart 6 of the bill, for people following at home or from their offices, it’s clause 57, “Membership of [the] board”. Now, there will be four water services entities set up—each one with potentially tens of billions of dollars’ worth of assets under management. And what clause 57 says, when it comes to the membership of the board, is what the board appointment committee—and that appointment committee, of course, will be the co-governance - based committee, the regional representative group—must have account for when they’re looking for board members of these corporations managing tens of billions of dollars of assets. I mean, Watercare alone is $11 billion. You add a few more councils on to it, and you’re probably getting close to $15 billion. Of course, they must have performance monitoring and governance experience—it’s very helpful—and network and infrastructure industries experience; for example, water services network and infrastructure industries. So I assume that means people who currently work for organisations like Watercare or Wellington Water or for other contractors who actually deliver the physical network services—very, very helpful.

And then we come on down the list, and I was looking for financial management. I mean, we’re talking about corporations that will have billions of dollars’ worth of assets under their management, and that potentially would have a million customers and will be generating revenues of billions of dollars per annum. But I was looking down the list under “Membership of [the] board” at all the skills: public health; environment, well of course that’s important; perspective of consumers and communities; of course, principles of Te Tiriti, Treaty of Waitangi. Financial management is not included. It’s remarkable. Financial management is not included. But when we consider the way this Government has treated taxpayer funds in the last three years, raising $40 billion more from taxpayers, hosing it out as if actually just spending money is an achievement in itself, it’s not surprising that they’ve omitted financial acumen from the requirements for members of boards of these large water services entities.

And that is why ACT has proposed an amendment to the bill. We’ve proposed in Supplementary Order Paper 294 to insert paragraph (g) into subclause 57(1). Financial management should be a requirement. We think it would be remarkable if the Government voted against this amendment. We assume that omitting financial management was simply an oversight, a design error, not intentional. So ACT wants to offer our Supplementary Order Paper 294, our amendment to the bill. And we also would propose that in addition, we add an additional subclause—57(3) we propose—that the board committee must ensure that at least half the members have knowledge of, and experience in relation to, performance monitoring and governance in network infrastructure industries. The ACT Party firmly believes that if we are going to deliver better water infrastructure and get better value for money and integrate infrastructure with growth in our urban environments, a majority of the people running water corporations should have performance monitoring and governance credentials and network and infrastructure industry experience and, in addition, financial management experience.

Now, it seems remarkable that in the design of this bill over many years—in fact, the first briefing I had from Department of Internal Affairs officials was in June 2020 during the election campaign, where they offered the ACT Party—David Seymour and myself—an insight into the thinking behind this reform programme. And the ACT Party’s engaged constructively with the Department of Internal Affairs. We’ve engaged with submitters, and we’ve tried to get the important aspects of infrastructure reform incorporated into this bill. But we haven’t been able to convince officials or the Minister to include financial management up until this point, and that is why we proposed this amendment. To the Minister in the chair, Minister Little, can I suggest that you consult with the Department of Internal Affairs officials who are sitting in the Chamber with us right now this morning and ask them if it is an oversight that financial management is not included in the criteria for board membership of these multi-billion dollar water services entities? Because it seems remarkable and it seems an oversight.

So what ACT would say is New Zealand is not different to the rest of the world. We are people who live in a country that is grappling with complex problems. We are growing. People come here to live here. We want to deliver better quality urban environments, cities that we can aspire for our children and grandchildren to inherit, and an environment that we expect to improve over time, taking account of all the mistakes we’ve made in the past, like putting waste-water treatment plants and foul sewage outfalls right where people customarily take shellfish or fish. We would never do that these days, but we don’t need a co-governance system imposed on infrastructure organisations to tell us that it’s a bad idea to put the sewage treatment plant outfall right on top of a shellfish bed, which is what councils and Governments used to do 50 or 100 years ago. We’ve moved on. New Zealand is no different to other countries. We’re grappling with the same complex problems. We don’t need co-governance. We don’t need allocation of special rights to groups based on who their grandparents were—their ancestors were—to tell us how to manage water.

What we do need are people who have experience in performance monitoring and governance of very large organisations of network infrastructure and the industries that support that, whether that be in planning, design, construction, maintenance of these networks. And we also need—it’s absolutely vital—financial management. One of the fundamental reasons that the ACT Party agrees we need reform in the way three waters is managed is because of the poor financial performance of some councils which have under-invested and instead chosen to spend ratepayers’ money on flamboyant things—like very expensive town halls and council buildings, for example—instead of actually fixing the underground pipes. Now to the Minister in the chair, Minister Little, I’d like you to respond to this. ACT feels very, very strongly that this is an important amendment that should have cross-party support, adding financial management into the qualifications for membership of water services entities boards. The ACT Party would urge the Minister and the Government to take this on. Thank you, Madam Chair.

Hon ANDREW LITTLE (Minister of Health): Thank you, Madam Chair, and thank you, members, for your recent contributions. Can I start with the contribution from Simon Court, and his most recent contribution was to implore the committee to accept his Supplementary Order Paper (SOP) amending clause 57 to add a reference to financial management. As the member himself acknowledged in his contribution, clause 57 already provides, in the list of collective board skills, performance monitoring and governance. It is pretty obvious, I would have thought, that performance monitoring includes not just operational performance but financial performance too. It remains a director’s duty that those on boards of this nature must ensure that the financial decisions that they take and the obligations they enter into, the debts they take on, are consistent with the long-term survival, and therefore performance, of the entity. Likewise, a collective skill in governance means the full range of governance skills that anybody on a board of an entity has to engage in. So, with all due respect to the member, I think that his SOP doesn’t add anything to the clause as it is at the moment. His words would be otiose.

That member, and also Melissa Lee before him, spoke to the committee about the representatives on the regional representative groups and about a concern about the make-up of that representation, in particular representatives of mana whenua, or Māori. Melissa Lee raised the point: is the representation even adequate? Is it democratic? Simon Court raised the issue that we don’t need to specify the make-up—we’re all in this together and everybody has water and water needs. None of those contributions mentions what does distinguish the New Zealand constitution, and that is the place and status of Te Tiriti o Waitangi. That is a document that carries legal effect. It has been recognised now by generations of our most senior courts and judges, and is something that the Crown must take account of. It is right and proper that the obligations of the Crown in any endeavour are appropriately reflected in the legislation covering those endeavours—so, when it comes to the governance of water and ensuring the provision of safe drinking water, of the safe disposal of wastewater, of the safe management of stormwater, that the legislation reflects and represents the Crown’s obligations as articulated by successive and many judgments of our most senior courts, as well as the Waitangi Tribunal. And that is what the legislation does.

The regional representative groups set a strategic direction for the entities. They are not making operational decisions. It is a matter for the boards of those entities to do that. I would just say to the committee that as a consequence of hearing from local government, as a consequence of hearing from communities, considering the many submissions that have accompanied the passage of this bill through the House, very careful consideration has been given to the make-up of those various levels of representation and governance—the regional representative group and the board of the entity—to make sure that an appropriate balance is struck, to ensure that there is good quality governance focused on what we expect of the entities, and also effective representation of the local government owners and of mana whenua, in full discharge of the Crown’s obligations under the Treaty. The bill in its current state truly reflects that.

MATT DOOCEY (National—Waimakariri): Oh, thank you very much, Madam Chair. I just want to return to a comment made by the previous Minister in the chair, Nanaia Mahuta, who disputed that Part 2 here that we’re talking about, the establishment of the water services entities—she disputed that this wasn’t a Government forcibly seizing ratepayer owned assets. She disputed that it wasn’t Government theft by stealth. I’d like to ask a question of the Minister that if they’re so confident that it isn’t those two things, then why not have a clause in Part 2 that would allow councils to opt out? Because, of course, at the start of this process there was good faith, and the councils were told that they could opt out of these mega water entities. So if the bill and the reform programme is such a good idea, as they proclaim, why would they not give the councils the choice to choose if they would join or not? Because, of course, if it was as good as their fake news ads proclaim, then councils would quite happily choose to opt in. Maybe there might be a mixed response. Maybe some councils do and some councils don’t. But why is there not the clause that would allow exactly what this Government promised councils at the start of this process—that they could opt out?

On the second point I’d like to make is just talking a bit more when the Minister, the previous Minister in the chair, talked about how it wasn’t a matter so much of ethnicity around co-governance obligations or co-governance structures in this bill; it was the obligations of the Treaty. I think it would be interesting to hear from this Minister, and he did somewhat talk to the point in his previous contribution, but I would like to hear—well, I suppose if we look at the Environment Canterbury (ECan) bill, there was some discussion whether the Treaty trumped democracy by undemocratically appointing two commissioners. So under the obligations of the Treaty in this bill, does the Treaty trump ratepayer-owned assets? It would be interesting to understand the interpretation of the Treaty in this bill as well.

Then my final point is the good Supplementary Order Paper (SOP) 287 by my colleague Simon Watts, which talks about replacing clause 27(2) to include at least one representative from each territorial authority covered by the entity. So what it’s saying is in those representative groups, every territorial authority within that grouping would have one seat. I would argue by the current bill, not having the ability for every council to be representative speaks to the heart of the matter that this Government fundamentally does not understand rural and regional New Zealand. Now, they sent out their Associate Minister, who went round every council and said “Look, you know”—doffed his cap—“we’re here to listen.” They all said to him, “You’re a great guy, but wrong party.” But they were left with the expectation that this Government was going to listen to them. The Prime Minister also made the statement when the three mayors got up in Auckland, Mayor Brown, Gordon, and Mauger, and the Prime Minister said, “We’re happy to listen.” So why would you not demonstrate you are listening with each territorial authority to include at least one seat, as described in SOP 287 by my colleague Simon Watts, that they can have one seat on every representative group as well as explaining to them, as they were promised at the start of this process, if it’s such a good idea, why can’t each council opt out, as they were promised?

ANDREW BAYLY (National—Port Waikato): What an excellent choice, Madam Chair. I just wanted to turn to Schedule 2, Part 1. As the Chair is probably aware, I represent the area of Port Waikato, half of which is in the Auckland City area, and the other half is in what will, obviously, become the Western-Central Water Services Entity.

Hon Louise Upston: Mighty Waikato.

ANDREW BAYLY: Mighty Waikato. But the first question I’ve got is about the issue around what happens if Watercare, or, actually, Mayor Brown, says no. What’s going to be the result? I don’t think we’ve canvassed this before. What happens if there is a revolt and Auckland Council says, “We’re not going to put Watercare into this new arrangement.”, and takes the Government to court? I’d just like to know what the Government’s Plan B option is.

Hon Mark Mitchell: Yeah, what is it?

ANDREW BAYLY: We don’t know—we don’t know, Mr Mitchell. That’s a real prospect. Actually, one might say it’s actually a call of democracy from the new Mayor of Auckland. And, of course, there’s other councils rebelling, as well—we know about Christchurch, etc. But that is the first question. I acknowledge the Minister stood up before, which is very good. What would be the outcome if Auckland Council chose not to proceed with this?

But the second thing is: if you take the Watercare area, which covers all of Auckland, the big issue I’ve got is, even in that big area, we’ve got competing priorities. Down south in my area, around Pukekohe and Drury, which is part of Judith Collins’ Papakura electorate—massive development going on; a whole lot of big developers doing thousands of homes, and the councillors love talking about the size of Hamilton being located in there in the next 30 years. And then if you go up to West Auckland and up towards where Mr Mitchell is the good MP, massive developments there. So, even in the city of Auckland, there are these huge competing priorities around “Do we put more infrastructure down south? Do we put it up over to the west?”

And, of course, Labour will assume that everybody can just borrow money and do everything at once. Well, actually, not. Particularly if you’re a board member, you have prioritisation; you have limitations around how much you can do. And, of course, what are the parameters for the prioritisation? So I’m just drawing on Watercare as an example. When you, then, expand it to include Auckland Council, Far North District Council, Kaipara District Council, and the Whangarei District Council, what a minefield about how this new entity will prioritise it.

I heard the Minister talking about, before, the representation group. But just going back to Matt Doocey’s point just before, even if one of these councils, like the Far North, doesn’t have a representative on that regional group, how, then, do we make sure that when the board comes together, it has a clear prioritisation of objectives? So one is that they will have this big kahuna of developments going on in Auckland, and then they’ve got obviously big social issues in places like Kaikohe, Kamo, all of those sorts of areas—how will the board take into account and prioritise that investment, particularly where you may not have a council advocate sitting on the representative board or actually have a direct influence in terms of who the board member is overseeing the affairs of the CEO?

I think that is one of the biggest things that we heard when Simon Watts and I were out going around the country, like all the members of the Finance and Expenditure Committee, hearing from people. The central issue that people had, and certainly from the mayors, was: “How do we have accountability?” When we asked them “What happens when you get the call, as the mayor, that you’ve got broken down water services in a small part of rural New Zealand, such as around the banks of the Kaipara; where do you send that person to and how do you make sure that that is dealt with in a timely manner?” That lack of accountability is one of the core reasons why so many councillors and mayors came to see us and say, “This is bad for our local communities.”

SIMON COURT (ACT): Thank you, Madam Chair. I want to bring the attention of the Minister, the committee, and those people watching at home, sitting in their offices concerned, to what the Government has proposed and whether it can be achieved. So I want to come back to some of the evidence that we heard at select committee, particularly around the status of water entities. If we go and look at clause 15 of the bill—15(1), “A water services entity—” it says—“(a) is a body corporate; and” (b) it’s accordingly a legal entity separate from the entity’s board members, the employees, and separate from the Crown. This entity is separate from the Crown. The Minister Nanaia Mahuta has said repeatedly that one of the objectives of this reform is to create balance-sheet separation. So what does “balance-sheet separation” mean for those people watching or listening to this debate?

Currently, according to the Minister, the water assets of councils are integrated with all the other councils’ assets—that’s their roads, their parks, their libraries, their swimming pools, and their buildings. And what this bill proposes to do is to separate out the water assets, put them behind a ring-fenced, new water service entity and say that they are separate now from the Crown and from council, and that if they’re separate, what that means is these water service entities won’t be hamstrung or handbraked by all of the debt that councils currently have; they’ll be able to raise new debt against these assets so that they can build more infrastructure.

In principle, that sounds fine. But what the Finance and Expenditure Committee heard was that the Department of Internal Affairs had Standard & Poor’s carry out an investigation into the balance-sheet separation and into the credit ratings of these water service entities. And what Standard & Poor’s told the Department of Internal Affairs, and the Minister knows this because I’ve asked her in written questions, is that if these entities are truly to be ring-fenced from the Crown and councils and have an independent balance-sheet—balance-sheet separation—then their credit rating is based on the amount of leverage and debt they’re going to take on. And let’s just start with the debt the Government’s going to dump into them on day one, that’s $2.5 billion worth of debt that this Government will have incurred through what they call a no worse off and better-off funding. In other words, the bribes they’re giving to council—not for three waters stuff right now—they can spend on swings and slides, or swimming pools, or parks, or whatever they like. That’s the bribe that this Government’s offered councils so that they will agree to participate.

But if we look at what Standard & Poor’s said, if they truly achieve balance-sheet separation, they’ll be so highly leveraged that these companies will be a high risk and their credit rating won’t be the A++ credit rating that councils currently have, it’ll be a B credit rating—a B credit rating. That’s one level above junk-bond status. Now, that’s in the Standard & Poor’s report that was given to the Department of Internal Affairs that was tabled at select committee. These entities will be one level above junk-bond status. So how is it possible that they can continue to access debt and continue to borrow and to fund infrastructure growth when this Government is going to dump a $2.5 billion debt straight on to them on day one without a single new piece of water infrastructure—pipe, manhole, or pump—being delivered? And it’s going to leverage them up with nine to 10 times their asset value in what’s regarded as a highly leveraged and high risk transaction. I’ve had advice from people who work in mergers and acquisition, who do this kind of financial transaction, and they say you shouldn’t do it.

Now, Minister, would you please tell us: can you achieve balance-sheet separation without these entities ending up with a B credit rating, one level above junk-bond status, or will they still be inextricably linked to the Crown balance sheet? Because you can’t have it both ways, Minister.

Hon ANDREW LITTLE (Minister of Health): Thank you, Madam Chair. Thank you for the members who’ve made their contributions; I’ll address each of them seriatim.

I’ll start with Matt Doocey’s contribution, who, apart from quoting the Hon Nanaia Mahuta several times, asked the question, “Why not allow councils to opt out?” I think even Mr Doocey acknowledged that there is a range and a mix of views across local authorities in New Zealand.

In the end, this is about a coherent regime that allows us, as a country, to manage the extraordinary challenges that we face with underground water infrastructure and to make sure we have water infrastructure that meets the needs of a healthy future. That is to say, good water reticulation, where that is required, and good discharge and disposal of waste water and, most importantly, right around the country, is effective management of stormwater, because that is a growing challenge right now and has been the victim of massive under-investment for many years. In order to achieve that, we need a coherent, cohesive regime, and that’s what this bill sets up.

Mr Doocey also made claims about the Treaty “trumping democracy” or the Treaty trumping ratepayer-owned assets. I’ll just make this point: the Treaty is a product of democracy. The Treaty has been incorporated into the democratic constitution of New Zealand, not just by its mere existence, but by, now, recognition and acceptance by the courts, exercising their common law jurisdiction, and, now, of course, by this Parliament through successive legislation, principally starting in 1975, but pretty much since then.

The Treaty is not some sort of adjunct; it is infused with the obligations of the Crown, and, for that matter, this Parliament. When it is making laws and it is regulating, in this case, natural resources or regulating communities, there is no “trumping” of anything; it is a foundation on which we must legislate.

Mr Doocey then also referred to a proposed amendment, a Supplementary Order Paper, for clause 27(2), about the number of local government representatives. Clause 27(2) says, “Each regional representative group consists of a number of regional representatives that is provided for in the constitution”—that’s set out in section 91 of the bill, and is 12 regional representatives or—“any greater number of regional representatives.” That’s the end of it, so there is flexibility in representatives at that sort of level that I think addresses what I think was the implied concern from Mr Doocey’s submissions just now.

To Andrew Bayly, he asked, I think, “What would Wayne Brown do?” The one thing I know Wayne Brown would do is to comply with the law; that, I think, can be said without a shadow of a doubt. He asked about the parameters of prioritisation.

I think—the members I’m mixing up—of course, there is a deep political interest in what happens with urban, provincial, and other infrastructure, particularly of the infrastructure that this legislation will cover. There are political concerns about it, but in the end, what we need to be sure of is that there is a coherent way of managing those extraordinary challenges of the future. So we do have people who are focused on the long term—the long-term investments that are 50-, 100-plus year investments that we have to be thinking about. Because, with all due respect to local government and its history in this country, it simply has not been possible to have a local government cohort that has been capable of thinking 50- to 100- to 150-years ahead when it comes to these vital investments.

And finally, to Simon Court, who asks, “Can, under clause 15 of the bill, balance sheet truly be separated from the Crown?” Yes, it can be. It’s tied to these entities. There’s transfer of debt from local government to the new entities. The new entities will, just as we do with other local government entities and other Crown entities, we’ll also back them with Crown liquidity facilities to enable them to do their job. But the job of those boards discharging their performance and governance management duties will be to ensure that long-term decisions of amenities ensure their financial survival.

Hon PAUL GOLDSMITH (National): Thank you, Madam Chair. Look, it’s my pleasure to give my first speech on this bill, the Water Services Entities Bill, and in relation in particular to clause 27 and the co-governance arrangements. We’ve heard the Minister give a couple of speeches—

Shanan Halbert: Repeat.

Hon PAUL GOLDSMITH: —on this topic. It’s not a repeat; it’s my first speech—

Shanan Halbert: Your colleagues have been repeating the same issues.

Hon PAUL GOLDSMITH: Yes, and it deserves repetition because it’s an important issue. So we’ve heard from the Minister the Hon Andrew Little, who has said—and in response to what the Minister has said—“Well, the Treaty requires this, because the Treaty is a foundation or constitutional document.” Therefore, it follows, according to his logic, that, in the management of water in New Zealand, we should have regional groups to decide on things and they should have an equal number of representatives from the territorial authorities—the councils—and an equal number of mana whenua representatives, which is what we referred to as co-governance: the idea that there should be 50:50 decision-making between mana whenua—so iwi appointees—and representatives of those who have been democratically elected through our local government arrangements.

So the question I have of the Minister is: whereabouts in the Treaty, and in consequent arrangements, has he drawn the conclusion that it requires 50:50 decision-making in this area? And, if he thinks it does, how far does he think that logic extends? Should that extend, fundamentally, to how Parliament is organised? Should we have 50:50 decision-making between the Treaty partners in our parliamentary setting? And I ask this—and he’ll say, “Oh, well, no, no, we’re not suggesting that.” Well, that’s precisely the direction that his Government is taking us, in the local government context.

This bill is one; the other bill that we’ve just dealt with is the Canterbury regional council bill, which moved away from that principle—which is enshrined in our New Zealand Bill of Rights Act around equal suffrage—moved away from that to appointees by Ngāi Tahu in that case. And speeches from that side of the House indicated that it was the first step and that we want to go further, with a clear goal for a 50:50 arrangement in those places at local government elections. We’ve got some documents circulating proposing that that approach of mana whenua appointments to local councils should be extended—

CHAIRPERSON (Hon Jacqui Dean): Order! Order! Coming back to the bill.

Hon PAUL GOLDSMITH: Yes, well, a core part of this bill is the idea of co-governance in the arrangement of the three-water arrangements, and I’m talking about the context—

CHAIRPERSON (Hon Jacqui Dean): OK. Order! Order! We are addressing the committee stage of the Water Services Entities Bill—Part 2 and Schedule 2. While it is OK to give some context around the speech, the focus of any speech by a member is to focus on what is in the bill, not so much what isn’t. So I’ll ask the Hon Paul Goldsmith to come more closely to the bill.

Hon PAUL GOLDSMITH: A core part of this bill, which I am talking about right here, right now, is the 50:50 co-governance arrangements outlined in this legislation, and I am trying to explain my opposition to that, and that is what I’m trying to do—

CHAIRPERSON (Hon Jacqui Dean): OK, and so the member is welcome to do that, but he’s not welcome to reflect on the ruling of the Chair. So I am warning him that if he wishes to proceed, he addresses Part 2.

Hon PAUL GOLDSMITH: Thank you, Madam Chair. And so the question I have for the Minister is: where in the Treaty does it outline that there should be 50:50 decision-making in this role? And, if he can point me to that, where does he draw the line from that? Does it extend just to matters facing “natural resources”, a phrase that he used? Does he think that people of Māori ethnicity have a greater interest in water than other New Zealanders? And if so, please, I’d be interested to know why he thinks that. And, secondly, I’d also like to understand how he thinks the normal mechanisms of accountability will apply if we have 50 percent of the decision-making bodies appointed rather than responsible or accountable to the ballot box?

Hon ANDREW LITTLE (Minister of Health): Madam Chair, thank you again. I’ll just respond to the submissions by Paul Goldsmith on this part and, in particular, his references to clause 27. So I think the member asked where in the Treaty it is; the member will know, through the jurisprudence on the Treaty, that now goes—good, in-depth jurisprudence developed at the very least since 1987, following the State-owned enterprises (SOEs) decision, but, actually, some decisions before then. One of the articulated principles of the Treaty is partnership—so a sense that, at least in many respects, and certainly on natural resources, the Crown doesn’t assume the sole right to make decisions about natural resources, given the other principle of the Treaty, which is the protection principle, protecting the taonga of Māori.

If the member is concerned about the jurisprudence—how it has evolved, what it actually means in practice—there’s a number of people whom he might want to talk to for a further elucidation. I could think of people like Sir Doug Graham, who very much led the way in the early settlements following the changes to the legislation in 1986; people like Christopher Finlayson; people like Sir Doug Kidd, as he now is—all very clearly articulate about the Treaty. They’re steeped in the Treaty and its jurisprudence. If he’s concerned about this reference to interests in water by Māori, he needs to go no further than the evidence that Sir William English gave to the Waitangi Tribunal at a time when he was the Minister of Finance, on the issues about water, and particularly in the challenge over the asset sale or partial sale of the gentailer SOEs. So there are sources of authority the member—

CHAIRPERSON (Hon Jacqui Dean): Order! Staying with the bill.

Hon ANDREW LITTLE: But, Madam Chair, thank you for that. In relation to representation on the regional representation groups and on the board, as I said earlier, I argue that a very good balance has been achieved—that the regional representative groups provide a level of strategic direction in their representation from mana whenua and from local government, and then the boards, who are making the operational decisions for the entities that must deliver the services we expect to deliver. They are boards appointed for particular skills and competencies that are needed to run the water services entities. In total, that level of representation achieves a good balance to achieve what we need.

Hon PAUL GOLDSMITH (National): Thank you, Madam Chair; you’re very kind. I suppose the question that the Minister didn’t answer that I want to get him to explain is how he has taken the step from the idea of partnership, in the broad context, to 50:50 decision-making, as outlined in clause 27 of this bill. Because it is not obvious to me, and to many New Zealanders, that a broad concept of partnership under the Treaty overrides what up until now in New Zealand has been a widely understood concept that all New Zealanders should have an equal say in matters affecting their lives, and who they elect to make decisions about matters affecting their lives. So this Government—this Government—has made a very significant shift in its interpretation of what partnership means to mean 50:50 decision making. That, in our belief, is totally contrary to the basic understanding of our democratic values, which is that all New Zealanders should have an equal say, either at the ballot box, or—primarily at the ballot box—

Chlöe Swarbrick: Unless they’re 16.

Hon PAUL GOLDSMITH: Indeed; all New Zealanders over the age of 18, and I’m glad that our colleagues in the House want to debate those issues, and that’s fair enough, but in this matter, we’re talking about New Zealanders over the age of 18. So I’d like to understand, from the Minister, why his Government has decided to take the leap from a broad idea of partnership to understanding that to mean 50:50 decision-making. If he comes back and says, “Oh, well, the previous National Government did it in relation to a few settlements.”, yes, indeed, we did, with a strict focus on matters before a settlement claim in a discrete issue in the management of something like the Waikaremoana park or a particular river. This is a much broader issue as it affects decisions affecting the lives of everyday New Zealanders of all ethnicities, so that is what I’m trying to get him to explain.

If his argument is that, “Well, we’ve decided that partnership means 50:50 decision-making.”, the second question I have, which he didn’t answer, was how far does that extend? Can he give the Committee an undertaking that it’s his intention and the Government’s intention to extend that to every part of Government decision-making?

SHANAN HALBERT (Labour—Northcote): Thank you, Madam Chair, for the call, and to speak, particularly on an area we heard a lot about in the submission period. I know from my own community, and all members around the House would have had discussions with their own electorates to hear feedback on the Water Services Entities Bill. The key themes, Minister, that have come up in my community are, one, around how do ratepayers keep up with the sheer costs—the 7 percent increase that Aucklanders saw introduced this year—and the potential rising of those costs.

The second one, particularly for the North Shore, was around the closure of a number of North Shore beaches and how do we protect our water from contamination.

The third one was around how do we ensure that local voice, that taxpayers, ratepayers, continue to have their say and have a contribution. In Auckland it’s quite unique, of course, because we are under Watercare infrastructure already. But as the Finance and Expenditure Committee travelled around the country to hear those submissions, very strongly that came through around how do local people have their say? How do they contribute to the issues around water infrastructure in their own areas, whether that be in Tāmaki-makau-rau Auckland or whether that be in more regional areas? I’d just appreciate if you just break that down a little bit more, Minister, to avoid any confusion and be very specific around how we are protecting local voice.

Hon ANDREW LITTLE (Minister of Health): Thank you, Madam Chair. I’m happy to respond further to Paul Goldsmith and his contributions. I think, with all due respect to Mr Goldsmith, conflating what is a multi-layer level of decision making—strategic, with the regional representative group, and operational and entity-focused for the board—as somehow comprising 50:50 representation; it actually doesn’t. But as we have seen in other spheres—and he referred to decisions this Parliament has already made and legislation it’s passed—we have, at various levels, allowed a level of representation that reflects a Treaty partnership, and it is 50:50 representation. But when it comes to decisions—decisions about operations; decisions about extensions of networks, for example; decisions about incurring debt in order to carry out infrastructure construction—that is a matter for the board and the board making that with the repository of skills reflected in it. That repository of skills reflects the statutory requirements for appointments to those boards. That is not 50:50 representation, and given, Madam Chair, your ruling about the scope of the debate, I won’t engage any further on the particular points that the member has raised.

To Shanan Halbert, there is a very important challenge there for ratepayers, who are, ultimately, through their councils, the owners of these entities, who are there to manage these water assets and what have you. It is going to be through those bodies and through their representatives that are drawn from their councils to keep ratepayers informed about what is happening. Of course, ratepayers will take a very keen interest in ensuring they continue to enjoy the benefit of running water, where they are on a reticulated water supply, and for the discharge of waste water, and everybody—provincial, rural, metropolitan—will be concerned about stormwater and the management of stormwater. So it’ll be for those representatives and the councils from which they are drawn to make sure that their ratepayers are kept informed.

In terms of local voice, I refer the member to clause 29, which refers to the collective duty of the regional representative group, and outlines a number of duties and functions and powers which are described as wholly or mostly for the benefit of all consumers and communities in the entity service, taking into account the diversity of consumers and the community, and taking into account interests of the future as well. I think that is an issue that when we think about the life of infrastructure that we need, and the very long life that goes beyond many, many cycles of the electoral cycle of local government, and, indeed, of central government, it’s important that the decision makers at the time, whether at the board level or at the regional representative group level, take account of that long-term interest. I’m confident that in the framework that we’ve established in the bill to date, we will achieve that.

SIMON WATTS (National—North Shore): Thank you very much, Madam Chair. I want to move us to Schedule 2, which is part of Part 2 of this bill, and an area that I haven’t got in to substantial conversation to date on—but it’s pretty significant, because Schedule 2 outlines the water services entities and their service areas. There’s been a huge amount of conversation through the select committee process in regards to this; not only how many entities there are—which of course has been landed on before—but what Schedule 2, Parts 1 to 4 outlines is all of the councils and where they’re going to reside under this new model.

My questions for the Minister in the chair potentially may be quite applicable, because the Minister may be aware of other reforms currently under way by the Government that are also putting in place different geographical boundaries—I think, off the cuff, around health reforms, or the localities model; I think about the recent Resource Management Act reforms in terms of boundaries. So my question here to the Minister is, what consideration and what conversation was had with other Ministers in other portfolios, in terms of looking to try and align the boundary that aligns on the map of New Zealand in order to get some consistency in terms of how we are managing and operating specific services—in this case water services—across this country?

I’ll give you an example—and it’s in regards to Part 4 of Schedule 2, and you’ll see a little footnote at the bottom with two elements: Marlborough District Council and Tasman District Council. Both of those councils are actually part of Part 3, which is Eastern and Central, including Wellington. So in effect, the top part of the North Island has been cut off, and because they’ve used boundary lines that were through the Ngāi Tahu settlement process—and I acknowledge that that was some of the rationale. But why, then, is that potentially inconsistent with other reforms across other aspects of Government, and in particular—if I link back to clauses 11 and 12 of Part 2, which, if I remember off the cuff, are the objectives and functions of the water services entities. As the Minister articulated in her opening conversation on Part 2, the substantive aspect of this bill is around synergies and the achievement of financial synergies and other synergies, but particularly financial synergies in regards to operational expenditure and capital expenditure.

You can see where I’m going with this—Marlborough and Tasman districts are up the top part of the South Island and all of the remaining elements of the entity of which they are part of sit in the lower North Island. There are no water pipes across the Cook Strait—maybe I’m out of touch, but I’m pretty sure that’s the case. There are no synergies in regards to slicing off those two elements at the top of the North Island, but there’s a huge amount of synergy that they have with other parts of the South Island, and if I look at the boundary councils that are on the cusp of Marlborough and Tasman, there’s synergies there; we can’t argue with that. But why has the Minister, in this instance, in effect trumped the Ngāi Tahu boundary over and above clause 11 and 12—which is the pure purpose of this bill, to achieve more efficient, safe, and healthy drinking water—why has that been, in effect, deprioritised in this example? And based on that, how does the Minister foresee, in terms of the interaction occurring on waterways—particularly in the stormwater aspect, that in effect, spans both the councils that are in Schedule 2, Part 4: the Southern Water Services entity, and those that are part of the Eastern Water Entity. Because don’t forget, these two entities are going to be managed by two separate boards and two separate regional groups, two different call centres—one probably in Wellington, one in Christchurch. I’d appreciate it if the Minister could provide some context and some background to conversations in that regard.

Hon ANDREW LITTLE (Minister of Health): Thank you, Madam Chair, and thank you to Mr Watts for that—I think, you know, a very important question. And I can tell him, too—there were considerations given to aligning regions, as we often do when we’re looking at organisations that span the country, looking at regions that might align with regions that have been established for other purposes. And the member is right; if you went through some of the big Government departments and operations, you will find New Zealand carved up in a multiplicity of different sorts of ways.

In relation to, and at the time of course, we were looking at this programme of work and this legislation. We were also doing the health reforms, and we’ve got four regions scoped out for that, and we did wonder whether there was some alignment. A couple of factors in this: first of all, in order to get the iwi Māori input along the lines that is provided for in the framework we’ve got on this legislation, it has to be noted that there is iwi Māori input, along the lines that is provided for in the framework that we’ve got on this legislation. It has to be noted that there are iwi who do straddle the Cook Strait—so iwi here in this part of the North Island rohe and also the top of the South Island. So it was about getting some consistency there. And the second factor was—in the end, this is about catchments, particularly when it comes to stormwater. This is about catchments and making sure that when the entities are making decisions about how best to manage water flows throughout catchments, they’re reference points for consultation and make sense in that respect. And on that basis we determined the regions as they are defined.

INGRID LEARY (Labour—Taieri): I move, That the question be now put.

SIMON COURT (ACT): Thank you, Madam Chair. I want to bring the Minister the Hon Andrew Little back to the comments that he made in response to my question about balance sheet separation. I think, Minister, you’ve laid it bare: there is no balance sheet separation. You stated that these water service entities will require Crown liquidity—a backstop lending function. That’s exactly the point that Standard & Poor’s made in their report to the Department of Internal Affairs that was tabled with the Finance and Expenditure Committee. So you don’t have balance sheet separation; you, essentially, have all of the debt and all of the liabilities that these water service entities will have, basically, recorded against the Crown’s balance sheet. What on earth is the point of that? Either you’re going to stand up water service entities, some kind of corporation, whether it be as ACT proposes, a voluntary amalgamation of assets and services—that’s what ACT proposes in our alternative three-waters infrastructure plan—which can be truly independent if they want to be, or you go through this charade, which is what this Government has done, of pretending these entities, by moving these assets out of local government control into a centralised entity, can somehow achieve balance sheet separation. Minister, thank you; you’ve made it clear that’s not going to happen. These entities will be backstopped by the Crown.

So what would be a better proposition? This is what ACT would do—and I want to test this on you, Minister. When it comes to funding and financing water services, water infrastructure development, if we think about all of the options that are available to the Government right now, we have the Infrastructure Funding and Financing Act. That allows for special purpose vehicles—essentially, a bond to be raised—to raise money to fund infrastructure. Right now, there’s an application sitting on the Minister for Infrastructure’s desk for an upgrade to the Moa Point Wastewater Treatment Plant, just here in Wellington. Now, the Infrastructure Funding and Financing Act, which was passed by Labour in 2020, actually says that, look, if you’ve got a piece of infrastructure that you want to develop, build new, renovate, you should be able to go and raise debt to pay for it now, to pay for the design and construction, as long as you’ve got a revenue stream out into the future—in other words, you can send people a bill, whether they’re ratepayers or commercial water users—and that revenue will then pay down the debt over time. It’s called a special purpose vehicle, to people watching at home or listening to this debate. The current Infrastructure Funding and Financing Act, which Labour passed, allows for that. Moa Point Wastewater Treatment Plant is the first cab off the rank—it’s the first project that’s been proposed under that model—and Wellington Water is waiting for a decision from the Labour Government on that. That’s one way to fund and finance infrastructure, and we don’t need the Water Services Entities Bill to do that.

Now, another way might be, if you’re a land developer, for example, or if you’re a big industrial water user, that you might want to go out and raise a revenue bond to fund your infrastructure. A local council could do this, too. In fact, up until the 1990s, one of the main ways that local governments raised money to pay for infrastructure, including things like the Auckland Harbour Bridge, was to raise a bond and borrow the money from the likes of super funds, institutional funds, pension plans—the kinds of places that people put their money for their retirement, and those institutions have money that they want to invest in long-term, safe assets that give a good return for people who need to collect their pension years down the track. That’s how local government used to raise money—through revenue bonds. That’s a great idea; ACT supports that. That was proposed by Dr Eric Crampton of the New Zealand Initiative. He said, “We’ve already got these tools, Minister. And, in fact, we don’t need balance sheet separation; we just need to let local government asset owners have access to more flexible funding and financing arrangements.” That’s what the ACT Party supports.

So, Minister, would you please respond to this question: why, simply, isn’t it that you let the Infrastructure Funding and Financing Act and these more flexible tools deliver the money that these assets need?

Hon ANDREW LITTLE (Minister of Health): Thank you, Madam Chair. I’ll try to respond as briefly as I can to Mr Court’s points that he raised. So, in terms of balance sheet separation, the advice we’ve had is that, notwithstanding any credit liquidity facility that the Government has previously offered to local government and would continue to offer, that doesn’t affect the Crown’s credit rating, but it enables, as we do with local government when they get financially distressed, and we have had some in recent years—it simply means that that body can continue to do its job on behalf of its ratepayers as it stabilises and sorts itself out.

In terms of the ACT Party’s alternative approaches, the reality is that these entities will not be constrained in terms of the ways they may wish to raise finance. If they want to issue bonds, that will be a matter that they can consider. It is possible that the infrastructure investment facility may be available for water projects run by any of these entities, but my understanding is that, in terms of planning and preparation for these entities, it won’t necessarily be the most attractive option for them. They will find and work out their ways of financing their projects as they make decisions that affect their balance sheets in due course. In the end, they will be charged with making sure that the infrastructure they are responsible for is functioning and working, the long-term planning is happening, and they seek financing accordingly.

CHAIRPERSON (Hon Jacqui Dean): Members, the committee is suspended and will resume after oral questions this afternoon.

House resumed.

Sitting suspended from 12.58 p.m. to 2 p.m.

Sittings of the House

Sittings of the House

DEBBIE NGAREWA-PACKER (Co-Leader—Te Paati Māori): Point of order. Tēnā koe e te Māngai. I seek leave for Te Paati Māori to participate remotely in sittings of the House until midnight on Saturday, 26 November 2022.

SPEAKER: Leave has been sought for that purpose. Is there any objection? There is none; it shall be done.

Oral Questions

Questions to Ministers

Question No. 1—Prime Minister

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

Rt Hon JACINDA ARDERN (Prime Minister): Yes, particularly this Government’s decision not to prioritise $11 billion on tax cuts targeted to the wealthiest New Zealanders and instead focus on targeted support for New Zealand families to soften the blow from this global crisis. This has enabled us to provide additional support to New Zealand households through the family tax credit, increasing childcare subsidies, higher minimum wage, support for winter energy bills, longer parental leave, the Best Start payment, higher benefit payments, lower fuel costs through the fuel tax reductions, supporting the supply of a record number of new homes, and encouraging more people into work than ever before, all while reducing Government spending back to the historic average as COVID-19 stimulus and support concludes. These are turbulent times, but I stand by this Government’s response.

Christopher Luxon: Does she agree that her Government’s decision to unleash a tsunami of cash on the economy means the Reserve Bank has to smash families for the sixth time this year with even higher interest rates just to keep up?

Rt Hon JACINDA ARDERN: I think we need to push through the rhetoric that is coming from the Leader of the Opposition, which, quite frankly, is inaccurate. I would refer back to the percentage of GDP that represents Crown spending right now: one of the largest drops that we’ve seen, from 35 percent to 31 percent. Compare that to the National Government under the global financial crisis, whose spending in 2009 was 34 percent of GDP.

Christopher Luxon: Why, when the Reserve Bank is putting their foot on the brakes with rising interest rates, is her Minister of Finance keeping his foot pushed down on the accelerator with unprecedented spending, and isn’t that just a recipe for economic burnout?

Rt Hon JACINDA ARDERN: I again refer to the facts, which seem to be absent in the member’s question. Again, as a percentage of GDP, Government spending, Crown spending, sits at 31 percent. That is, of course, because the COVID spending and supports have come away, as planned by this Government, whilst at the same time we have put in place targeted support. Again, contrast that with the National Party’s plan of $11 billion of spending targeting the wealthiest New Zealanders, which we know would make inflation worse.

Christopher Luxon: What does she say to the homeowner with a $700,000 mortgage who, after re-fixing their mortgage rate, is now paying almost $600 more each and every week in interest because her Government is spending a billion dollars more every week to feed its addiction to spending?

Rt Hon JACINDA ARDERN: Again, I believe that most New Zealanders would be looking around the world right now and seeing the circumstances that all economies find themselves in—the IMF just over the weekend predicting that in terms of global growth, there’s a 25 percent chance it will slow to 2 percent or less and that we will see in emerging financial markets 30 percent of banks in distress. These are tough times; New Zealand is not alone in that. That is why in this country our Government is focused on supporting those New Zealanders through those difficult times.

Christopher Luxon: Does she agree with the IMF, who came out yesterday saying that “fiscal restraint can lower inflation while reducing debt.”, and, if so, why won’t her Minister of Finance rein in his addiction to spending?

Rt Hon JACINDA ARDERN: Actually, I met with the director-general of the IMF, and what we are doing is very much in line with their policy prescription: targeted support for New Zealanders. In fact, one of the specific things that they have suggested is, for instance, childcare subsidies, which is exactly what this Government has done. One of the things they advise against: broad-based tax cuts which would add stimulus and make inflation worse.

Christopher Luxon: Why can’t she just concede that her Government has wasted billions of dollars on failed programmes like the cost of living payment, the RNZ-TVNZ merger, and report after report on failed transport projects like light rail?

Rt Hon JACINDA ARDERN: The gall of being told that the cost of living payment is a waste of money for those on $70,000 or less but $11 billion on a tax cut for those on under $180,000 is not—I totally reject that. I stand by our response; now he needs to stand by his.

Christopher Luxon: Is it seriously her view that widespread job shortages and record Government spending have had no impact on inflation, and, if so, why does she think Westpac is saying, “the economy has become increasingly overheated, with inflation pressures boiling over in every corner of the country.”?

Rt Hon JACINDA ARDERN: You could also add every corner of the world. New Zealand is in the lower half of the pack of 38 nations in the OECD. In fact, relative to others, we appear to have peaked when others continue to climb. I know the member would like to think that New Zealand is not affected by the global volatility we are seeing, but we are. But what protects us is making sure that we have low unemployment, support for, for instance, our targeted sectors that provide employment, record-low unemployment, and support for our exporters. We stand proudly on our record there.

Christopher Luxon: Does she take any responsibility for record-high domestic inflation, or will her record reflect that when Kiwis were suffering, it was always just someone else’s fault?

Rt Hon JACINDA ARDERN: Again, I refer back to my earlier answer. The idea that somehow we are the only ones experiencing high rates of inflation—we are not. It just demonstrates to me the way that this member has insulated himself from what is occurring. What we take absolute responsibility for is our support for New Zealanders. That is why we’ve reduced the cost of fuel, it is why we’ve increased the family tax credit, and it’s why we’re increasing childcare subsidies. The member proposes to give those same families $2 a week and make inflation worse.

David Seymour: Can the Prime Minister see the problem with every world leader saying inflation is worse than some other country and none of them doing anything effective to actually tame it?

Rt Hon JACINDA ARDERN: Again, I come back to my response. The idea that we are doing nothing in the face of inflation is patently wrong. But, of course, it’s not just about fiscal policy; monetary policy plays a role too.

David Seymour: Point of Order! Mr Speaker, my question was very clear. It was “nothing effective”. Now, the Prime Minister said she wasn’t doing nothing, but she didn’t address if she was doing anything effective.

SPEAKER: I think you’re wrong. She did address it.

Question No. 2—Finance

2. BARBARA EDMONDS (Labour—Mana) to the Minister of Finance: Talofa lava, Mr Speaker. What recent reports has he seen on the New Zealand economy?

Hon GRANT ROBERTSON (Minister of Finance): In its latest note on New Zealand, the OECD is projecting the economy to slow in 2023 due to global uncertainty and lower domestic demand. It is forecasting economic activity to moderate to 1 percent next year and warns that risks to the projection are to the down side. Nevertheless, New Zealand finds itself in a good position to face the challenges ahead and support our people to blunt the sharp edges of the global economic slowdown. The OECD noted that unemployment is close to historic lows, wages are growing, and the reopening of borders has contributed to a surge in tourists. The Government’s books are in a strong position, with debt levels among the lowest in the world. This will be a tough period for many New Zealand households, but our country is in a strong position to manage it.

Barbara Edmonds: What did the report say about New Zealand’s public finances and its impact on the economy?

Hon GRANT ROBERTSON: The OECD said fiscal consolidation was appropriate to help reduce demand pressures and make sure that New Zealand was on track to meet a Budget surplus target. For the 2022 June financial year, core Crown expenses were below forecast. Excluding COVID emergency spending, expenses were about 31 percent of GDP, which is in line with the historic average. The fiscal impulse is forecast to turn contractionary in the current June 2023 financial year and remain so throughout the remainder of the forecast period.

Barbara Edmonds: What further reports has he seen on the global economy and its impact on the New Zealand economy?

Hon GRANT ROBERTSON: The OECD is forecasting that global economic growth will slow to 2.2 percent in 2023 and said the world was now paying a high price for Russia’s unprovoked, unjustifiable, and illegal war of aggression against Ukraine, which is resulting in high levels of inflation and energy supply shortages, particularly in Europe. The OECD is projecting that the UK will contract 0.4 percent next year, while the US will grow 0.5 percent, and Europe by 1.8 percent. The 38-nation OECD will expand by 0.8 percent.

Barbara Edmonds: What reports has he seen on the role of the export sector in the economy?

Hon GRANT ROBERTSON: The export sector is continuing to support the economy. Statistics New Zealand reported that exports rose 14 percent to $7.1 billion in October, compared to the same month a year earlier. On an annual basis, exports rose 14.5 percent to $71 billion. The sector is continuing to show its resilience, but as I’ve noted previously in the House, what happens overseas will impact on New Zealand’s prospects. If our trading partners do move into recession, this will affect the demand for New Zealand’s goods. As a Government, we will continue to support New Zealanders and soften the impact of these global shocks, while investing for the long term in health, education, housing, and addressing climate change. We will responsibly manage our finances and make sure that, as New Zealanders face difficult times ahead, we are there to support them.

Question No. 3—Education (School Operations)

3. CHRIS BAILLIE (ACT) to the Associate Minister of Education (School Operations): Would she consider requiring attendance officers to report their data to the Ministry of Education; if not, how is she evaluating whether the $16.5 million per annum spent on the Attendance Service is delivering results?

Hon JAN TINETTI (Associate Minister of Education (School Operations)): To the first part of the question, they already are required to do this. To give further assurance to the member, the Attendance Service providers are required to provide an annual business plan, six monthly reporting, and an annual report to the Ministry of Education. This also includes monitoring on the key performance indicators set out in their contracts, such as the number and duration of non-enrolled cases and the work to get them back into education. This information informs whether each attendance provider is delivering on their contract terms.

Chris Baillie: Is the Minister concerned by the fact that 108 schools who could have submitted their attendance data for term 2 chose not to provide this information to the ministry and, if so, is she considering requiring schools to report their attendance data in 2023?

Hon JAN TINETTI: We have a long historical time series that goes back to 2011. Compulsory data collection isn’t on the current work programme. We have enough data to give us a nationwide picture of where things are at.

Chris Baillie: Does the Minister think it is good enough that less than half of the 13,739 non-enrolment notification cases and just over half of the 11,031 unjustified absence cases referred to the Attendance Service from 1 January to late October have since returned to school, and, if not, is the Minister considering any changes to attendance adviser contract requirements in 2023?

Hon JAN TINETTI: Returning to school is one option for those young people. We also work on getting them into other forms of education and employment.

Chris Baillie: Does the Minister believe that spending $1 million on a campaign to remind parents of the importance of school attendance was a good use of taxpayer money, and, if so, what metrics have been implemented to measure the effectiveness of this awareness campaign?

Hon JAN TINETTI: That money came out of baseline funding. If we have laser-sharp focus on getting our young people back into education, training, and employment, we are seeing that those numbers are starting to change.

David Seymour: Point of order, Mr Speaker. The question was whether they got value for money. The Minister said that it came out of baseline funding, that they had a laser-like focus, and that the numbers were trying to change, but she never addressed whether that particular expenditure had been effective in any way.

SPEAKER: I counted three—I’ll get the member to remind me of the question, but I’m pretty sure I noted at least two legs to that.

Chris Baillie: Does the Minister believe that spending $1 million on a campaign to remind parents of the importance of school attendance was a good use of taxpayer money, and, if so, what metrics have been implemented to measure the effectiveness of this awareness campaign?

SPEAKER: There are two parts. The first part was addressed.

Chris Baillie: If the Government was able to publish the previous day’s COVID cases every single day, why does it take 15 weeks to publish attendance data, and will the Government commit to publishing attendance data daily?

Hon JAN TINETTI: This year is no different from any other year. The Ministry of Education has published the data from term 2 in exactly the same time as it has in every other year since 2011. One of the reasons that it does take so long for the ministry to publish that data is to make sure that that data is correct, and to make sure that we have a good data set.

Question No. 4—Finance

4. NICOLA WILLIS (Deputy Leader—National) to the Minister of Finance: Does he stand by his statement that “many New Zealanders will be facing increased mortgage payments over the coming year”, and has he sought advice to quantify the financial impact record interest-rate rises would have on New Zealanders?

SPEAKER: And that’s to the Minister of Finance, the Hon Grant Robertson.

Hon GRANT ROBERTSON (Minister of Finance): I stand by my full statement that “As we’ve discussed before when the member has raised these kinds of examples, it would very much depend on the specific circumstances of that household. What we do know is that many New Zealanders will be facing increased mortgage payments over the coming year. That’s why it is a good thing that average hourly earnings are tracking just above inflation at the moment. That’s why it’s a good thing that we’ve increased the minimum wage. That’s why it’s a good thing that we’ve provided additional support for low and middle income households—things that the National Party has opposed.” In response to the second part of the question, there is no need for me to seek this advice as I regularly receive reports on the financial system, its stability, and its impact on New Zealand households. In response to these kinds of reports, the Government is providing additional support to New Zealand households through the family tax credit, higher minimum wage, higher benefit payments, lower fuel costs, and encouraging more people into work than ever before.

Nicola Willis: Will the Reserve Bank’s record interest rate hike today worsen the cost of living crisis that New Zealanders face?

Hon GRANT ROBERTSON: Well, again, in answer, as I answered to the primary question, New Zealand households experience these things differently. Certainly for those people—

Christopher Luxon: Are you seriously not going to say “no”?

Hon GRANT ROBERTSON: —who will be re-fixing their—I’m not, Mr Luxon; just listen. Mr Luxon, just listen. For those households—for those households—who experience the need to re-fix their mortgage over the next couple of years, they will be facing significant increases in their costs and cost of living pressures. That’s why, as a Government, we’ve committed ourselves to making sure that we relieve that cost of living pressure, particularly on those who feel it the most: low and middle income households. That is the policy’s prescription that we prefer. The member may well prefer to give tax cuts to the wealthiest New Zealanders as a response to this—tax cuts that even Don Brash thinks are a bad idea.

Nicola Willis: Does the Minister think it’s appropriate to choose this moment to engage in political point-scoring—[Laughter from the Government side of the House]

SPEAKER: Order! Yeah, silence when questions are being asked.

Nicola Willis: Shall I start again?

SPEAKER: Yes, if you like.

Nicola Willis: Does the Minister think it is appropriate to choose this moment to engage in political point-scoring when, across the country today, tens of thousands of New Zealanders have learnt that in the next year they will have to find thousands of extra dollars to make their mortgage payments each week?

Hon GRANT ROBERTSON: Lessons on political point-scoring from the Olympic champion in that regard are not ones that I’m going to accept. On this side of the House, we take the plight of New Zealanders seriously. That’s why we have stepped up continually to support New Zealand households through what is a very, very difficult time. If what the member wants is to avoid political point-scoring, let’s have a proper debate about a global inflation crisis where every central bank in the world had to deal with it; where every Government had to undertake fiscal policy to deal with it, at the end of which, on fiscal indicators, we find ourselves with one of the lowest levels of debt in the OECD; where we have the lowest level of unemployment on record here; and where, on an inflation measure, we’re the 10th lowest out of 38 OECD countries. That would be a proper policy debate, not political point-scoring.

Nicola Willis: What does the Minister take more seriously: name-calling his political opponents, or the fact that the Reserve Bank has just forecast that New Zealand will go into negative growth next year and stay there for four quarters, spelling a deepening of the cost of living crisis for every single New Zealander?

Hon GRANT ROBERTSON: I take seriously the fact that New Zealand, as an open trading economy, will always suffer the impact of what happens around the world. I take seriously supporting New Zealanders through that, to make sure that those who are the most affected—on low and middle incomes—get support; not those who are on the highest incomes. As I have said in this House many, many times, 2023 will be a difficult and challenging year for New Zealand. Our starting point is better than most other countries: New Zealanders are in work while facing these issues; New Zealanders are seeing their average hourly earnings rise ahead of inflation. This will be a challenging time—as it happens, the Reserve Bank are forecasting that growth in the last two quarters of this year will be very, very strong, and yes, there will be a period where it comes off from there, but New Zealand, overall, remains resilient and strong in the face of this.

Nicola Willis: Does the Minister understand that non-tradeable domestic inflation here in New Zealand is currently the highest it has been since records began, and that this measure is something he can’t blame on Vladimir Putin?

Hon GRANT ROBERTSON: As we’ve discussed numerous times in the House, non-tradeable inflation is not a direct corollary with domestic inflation. I’ve already worked the member through the issues around the construction sector and the imported inflation that occurs in what is something that is largely seen as a non-tradeable item. What I do acknowledge is that we are now in a period of time where inflation is much higher than we have experienced in recent years; it is an issue that all New Zealanders will feel the consequences of. What I would say is that a responsible Government strikes a balance between making sure that we do the things we can to reduce that, but also to continue to support the low and middle income New Zealanders most affected by it—that is not the member’s policy.

Nicola Willis: Is the Minister aware that, unlike in many of the countries he likes to compare New Zealand with, the Reserve Bank is forecasting that inflation is yet to peak here at home, and will hit 7.5 percent in the coming months—right at the same time as New Zealanders will be paying record mortgage payments, and when will that Minister present a plan to address it?

Hon GRANT ROBERTSON: Those countries around the world that we seek to compare ourselves to have inflation—in the case of the UK, up over 10 percent. They’ve had inflation in the case of Australia, likely to reach at 8 percent by the end of the year. We continue to find ourselves in a position where we have the tenth lowest inflation out of 38 countries in the OECD. The cost of living pressures that we see are strong. Now, the member might like to think about the fact that actually, the actions that the Government has taken—for example, reducing the fuel excise duty and having half-price public transport—have contributed to lowering the Consumers Price Index.

David Seymour: Does the Minister of Finance accept that the problem with inflation is now much worse than anticipated, say, six months ago, and if so, what changes in policy is the Minister prepared to make that he hadn’t announced six months ago?

Hon GRANT ROBERTSON: It’s certainly true that the forecasts around inflation have been worse now than they have in the past. The member will also be aware that we are heading towards a Budget where our percentage of spending as a GDP will continue to go down. That is the approach we’re taking; the fiscal consolidation that’s needed. The member doesn’t get to rewrite history. New Zealand was able to get through COVID by making sure we looked after lives and livelihoods; I stand by that approach. The period of time now in front of us is one where we do need fiscal consolidation, and that is what will occur.

Nicola Willis: Why is it that in this moment—when millions of New Zealanders are now worrying about how they are going to afford their mortgage repayments, while other costs continue to grow—all that Minister can offer is excuses, no accountability, and no solutions?

Hon GRANT ROBERTSON: What this side of the House is able to offer New Zealanders is record low unemployment, wages growing faster than inflation, an economy that has actually grown through COVID—and when we do have to deal with the economy slowing down, we are in a much stronger position than almost any other country. On this side of the House, we understand it’s a balance: we’ve got to look after New Zealanders, we’ve got to invest in public services, and we do need to return to some form of fiscal consolidation. All of that’s a balance. The member’s policy of tax cuts for the wealthiest New Zealanders will make that situation much, much worse.

Question No. 5—Health

5. Dr DUNCAN WEBB (Labour—Christchurch Central) to the Minister of Health: What is Te Aho o Te Kahu—Cancer Control Agency doing to improve men’s health?

Hon ANDREW LITTLE (Minister of Health): Te Aho o Te Kahu—Cancer Control Agency is currently undertaking a large, proactive programme of work to transform the way cancer treatment services are provided in New Zealand. We know that prostate cancer is a serious issue for men in this country. It’s the second most commonly diagnosed cancer in New Zealand men. Every year, nearly 4,000 men are diagnosed, and about 650 die from the disease—the third highest cause of death after lung and bowel cancers. The work of Te Aho is to support those diagnosed with cancer to access high-quality care, regardless of who they are or where they live. Specifically, in relation to prostate cancer, this is about ensuring the evidence-based guidance to improve diagnosis and inform the need to improve specialist cancer treatment and support services. This will improve how all men connect with, and journey through, the cancer care system, but will be of particular benefit to Māori and Pacific men and their whānau.

Dr Duncan Webb: What work is being done to improve cancer-related health outcomes for Pacific men?

Hon ANDREW LITTLE: Cancer disproportionately affects Pacific communities in New Zealand. This means many aiga grow up without their fathers, brothers, sons, uncles, and grandfathers, because of the inequitable access to cancer treatment for these communities. Te Aho have been working with community partners, such as Moana Connect, to better overcome the barriers Pacific men face in getting cancer treatment. This research, which will be released early in 2023, will inform further work by Te Aho to identify opportunities to improve cancer coordination and support or care for Pacific peoples during cancer treatment.

Dr Duncan Webb: What work’s being done to improve cancer-related health outcomes for Māori men?

Hon ANDREW LITTLE: We know that Māori have worse cancer survival rates than other New Zealanders, particularly Māori men. Māori are 20 percent more likely than non-Māori to develop cancer, and twice as likely to die from it. These outcomes are not good enough, and that’s why the work of Te Aho, in conjunction with Te Aka Whai Ora—Māori Health Authority, is so important. Te Aho works closely with Hei Āhuru Mōwai—Māori Cancer Leadership Aotearoa. Their members sit on many of Te Aho’s major advisory groups, targeting advice towards equitable cancer outcomes for Māori, as well as access to Māori cancer expertise. The Government is also taking further steps, as announced in the Budget this year. From 2023, we are lowering the bowel-screening age for Māori and Pacific people, from 60 to 50 years of age. This will help stem the longstanding inequities these communities face in accessing such vital health services compared to other New Zealanders.

Dr Duncan Webb: What else can be done to support improvements in men’s health?

Hon ANDREW LITTLE: Well, I’m glad that member asked. As with every Movember, growing a mo is the biggest way to show your support, or anyone’s support, for this very cause, and, of course, I am someone who already sports a fair amount of facial hair myself. As a cancer survivor myself—prostate cancer—it is fantastic to see such support some blokes are doing across the Chamber to help raise not only awareness but also funding for men’s health.

Dr Duncan Webb: In light of that answer and in view of Movember being a health initiative, does the Minister have a view of which mo is the best in the House?

SPEAKER: In so far as he has ministerial responsibility!

Hon ANDREW LITTLE: Mr Speaker, naturally your good self, as the top contender, but I am thankful for all members who have participated in this very important gesture.

Question No. 6—Broadcasting and Media

6. DAMIEN SMITH (ACT) to the Minister for Broadcasting and Media: Can he name any new services which can be provided under his public media merger but cannot be provided without it; if so, what are they?

Hon WILLIE JACKSON (Minister for Broadcasting and Media): The bill ensures that current TVNZ and RNZ media services will remain. But I thank the member for catching up and realising that there will be new services that come from a new public media entity. That could not occur within the current funding and structure. As that member has identified, the new entity will be able to create new services that ensure our stories, our news, and our voices can continue to be told in a changing media landscape. What these new services are won’t be determined by me—as the Opposition know—as the Minister, because we wouldn’t want to interfere in things; they will be determined by the new entity. That is only right.

Damien Smith: Point of order, Mr Speaker. The question was very specific and on notice, asking what new services specifically were able to be provided by the merger but can’t be provided without it. It was not asking about what they will do, which I’m aware is up to the entity to decide, but what this merger enables them to do that they can’t do without it.

SPEAKER: Yeah, I’m going to agree with you, and I shall give the member two extra supplementaries to examine the Minister.

Damien Smith: So, Minister, if it can’t provide new services that you can’t outline, why are you spending hundreds of millions of dollars, as well as creating huge uncertainty for employees and the industry, all for an entity that can’t even provide any new services, as specified?

Hon WILLIE JACKSON: There will be new services. I cannot stipulate what the programmes are going to be. I’m not the programme director. That will be the role of the management and the new entity. Why we are spending on this merger is because the Opposition have underspent on media for decades, as they have underspent on health, education, employment, and everything.

SPEAKER: Order! That was a straight-up question and the Minister went totally political on it; he shouldn’t do that.

Damien Smith: In light of not answering that, why does the Minister repeatedly refer to the need to compete with international streaming services as justification for the $360 million merger, and has the Minister been briefed that TVNZ already runs a streaming service without any need for his expensive merger?

Hon WILLIE JACKSON: I’ve been briefed by TVNZ. I meet with the CEO quite regularly. So, yes, absolutely. It’s about survival—it’s about survival. The global giants are applying pressure like we’ve never seen before. The way that New Zealanders are consuming their media is quite different. So we have to build a sustainable media entity, a strong media entity, a New Zealand public media entity that needs to be invested in. We will be doing that and we will be doing that over the next few years.

David Seymour: Point of order. Mr Speaker, the Minister didn’t actually address the question. The question was about whether he was aware that there was already a streaming service. He said he met with the CEO, he said it was about survival; he didn’t acknowledge whether he was aware of that or not, or address it.

SPEAKER: I will ask the member to ask that question again, and we’ll have the answer.

Damien Smith: Thank you, Mr Speaker. Why does the Minister repeatedly refer to the need to compete with international streaming services as a justification for the $360 million merger, and has the Minister been briefed that TVNZ already runs a streaming service without any need for his expensive merger?

Hon WILLIE JACKSON: Yes, I have been briefed by TVNZ, and I am aware of what they’re doing in terms of their streaming services. I will repeat again: this is an opportunity in terms of survival. Our media is under pressure. Our major media, TVNZ, has been losing money for a number of years now. We need to support them. We need to get a New Zealand voice out. New Zealanders need to see themselves; they need to hear themselves, Mr Luxon, and we’re proud to set up this new merger.

Damien Smith: I look forward to seeing the Minister on Survivor.

SPEAKER: Order! No, don’t start off a question like that. You’ve just lost one.

Damien Smith: Does the Minister intend his merged entity to compete with Netflix, and, if so, is competing with a $100 billion multinational corporation to which New Zealanders already have access seriously a good use of hundreds of millions of Kiwis’ hard-earned dollars?

Hon WILLIE JACKSON: Again, answering the member’s question, we do not want to roll over for global giants. We want to set up and strengthen the public media entity here. This is what this is about. I’m disappointed that that member wants to give away the New Zealand story to global giants. It’s not about that. It’s about looking after New Zealand media—TVNZ and RNZ coming together—investing once and setting the foundation and setting up the future for New Zealand media. This is a great investment. It’s sad the National Party has not invested properly. Shame on the National Party.

David Seymour: Point of order, Mr Speaker. The poor National Party have had nothing to do with the questioning. It’s completely unfair to bring them into the debate and is contrary to Speakers’ rulings.

SPEAKER: And normally I would agree with that, but the out of order interjections coming across are bound to get a reaction, and they did.

Damien Smith: Why has his merger bill not been subject to cost-benefit analysis, and is it because using $360 million of taxpayers’ money to compete with several hundred-billion-dollar companies would have been laughed out of Treasury as a horror show?

Hon WILLIE JACKSON: Can you repeat the question, please?

Damien Smith: I’m happy to repeat it. Why was his merger bill not subject to a cost-benefit analysis, and is it because using $360 million of taxpayer money to compete with multinational companies would have been laughed out of Treasury as a horror show?

Hon WILLIE JACKSON: No, that’s not correct. It was deemed that it was not necessary to go down that track. That’s what our business analysis told us, and the reality [Interruption]—this is good money being spent. The reality is that the National Party would invest only $90 million. We want to put a bit more money in, as we do in health, education, employment—right across the board. This is about preserving the New Zealand identity, not getting rid of it, as the ACT Party would do, and the National Party.

SPEAKER: Have you got another supplementary?

Damien Smith: I think so. Would it be more cost-effective, Minister, that his expensive merger should have been replaced with just buying New Zealanders all a subscription to Netflix?

Hon WILLIE JACKSON: No, not at all. The member is just not getting this. Unfortunately, he’s too close to the National Party. But the reality is that we have a media that is under threat at the moment, losing money everywhere—losing money, losing funding, under pressure—so we have to start a new strategy. That’s what the merger is about. It’s about bringing Radio New Zealand and TVNZ together so that we can put a great foundation in place, and, sadly, that member is not getting it. But I am happy to speak with him after this session if he likes.

David Seymour: Point of order, Mr Speaker. That repeated reference to a party not involved in the questioning in that instance means that the Minister is not only breaking the Speakers’ rulings; he’s doing it knowingly after you’ve just told him not to do it.

SPEAKER: Yeah, let me think about this. There are multiple things going on in this particular question and the answer. The member is right, but I’d go back to my former comment that there are also interjections coming across that are probably inviting some of the out-of-order comments that the Minister has made. Repeated requests to the Minister don’t seem to have worked, and I maybe have to think of a new strategy and implement that.

David Seymour: Another question, Mr Speaker?

SPEAKER: Yeah.

David Seymour: On that reading, the ACT Party is actually a victim of the National Party’s heckling, and perhaps should be considered for the awarding of additional supplementaries.

SPEAKER: I’ll come back to you on that one.

Hon Gerry Brownlee: Speaking to the point of order, Mr Speaker. Well, perhaps also the National Party should get a supplementary to be able to defend itself. The fact is too that if you were to look at the Hansard—and I know that you make an effort to do so afterwards—I think you’ll find that the reference to the National Party came well ahead of any heckling that was delivered from this side. I’ve been listening very carefully because I thought that yesterday you made some interesting comments—not necessarily rulings—but I don’t think that they were particularly helpful for the House. I’ve listened very carefully to the content and then part of the content going into our questions today, to make sure that we didn’t get into the same position as your comments suggested yesterday, but in this case Mr Jackson went out of his way in his first answer to bring in the National Party.

Hon Chris Hipkins: Speaking to the point of order, Mr Speaker. I think there are a number of observations one could make about this particular question exchange, one of which is that a very strict interpretation of the Standing Orders would result in a number of the supplementary questions that have been asked being ruled out of order on the basis that they don’t comply with the rules of Parliament because of the various assertions that they have contained within them. Secondly, the National Party have been interjecting constantly throughout the answers to those questions, and when one interjects in the way that the Opposition have been, they do have to expect some degree of response from the Minister answering a question. They are the ones who have chosen to involve themselves in the question. But perhaps the third and most important point, Mr Speaker, is that you are the sole judge of these matters, not the Opposition.

SPEAKER: I will take the time to review both Hansard and the recording of this question, and others, actually. It’s very difficult to keep up with everything that goes on in the House when you want the level of robust exchange that the House wants. I would encourage the Minister, though, that he doesn’t have to make these questions last longer than they really should, and if I did make a comment, he seems to revel in it. Probably I shouldn’t say that, but I’m just stating the obvious. Are there further supplementaries?

Damien Smith: No.

Question No. 7—Environment

7. TĀMATI COFFEY (Labour) to the Minister for the Environment: Will the repeal and replacement of the RMA reduce costs and speed up consenting processes; if so, how?

Hon DAVID PARKER (Minister for the Environment): Thank you, Mr Speaker. Yes, processes under the new resource management system will deliver considerable cost and time savings. More than 100 district and regional plans under the Resource Management Act (RMA) will be replaced by 15 Natural and Build Environment Act (NBA) plans. More activities will be permitted, fewer consents will be needed. Clearer notification and information requirements, independent hearings panels for plans, better designations, and narrower appeals will reduce planning delays, costs, and re-litigation. A fast-track pathway, which has already shown to reduce consenting times by 15 months, will be made permanent for infrastructure and significant housing developments, so repeal and replacement of the RMA will be faster, cheaper, and better for Kiwis.

Tāmati Coffey: When will we first see the improvements from the repeal and replacement of the RMA?

Hon DAVID PARKER: A draft national planning framework is already being prepared and will include a pro-infrastructure chapter, which will be released upon the Act being passed. This will then come into force in 2024, which will enable the first three regions to prepare their regional spatial strategies, which will take about two years and will then enliven the new designation powers. Fast track, which currently expires in 2023, is proposed to be extended so there is no gap between the current fast track and its permanent version under the NBA.

Tāmati Coffey: How will reducing the number of district and regional plans, from more than 100 to 15, reduce compliance costs?

Hon DAVID PARKER: Well, this will substantially reduce the number of plans, obviously, and it will also enable better-quality plans and greater consistency and therefore regulatory predictability. In Greater Wellington, for example, there will no longer be separate plans for Porirua, Lower Hutt, Upper Hutt, and Wellington City, and developers will be able to rely upon one plan across the region with provisions that become more consistent. More activities will be permitted in NBA plans with standards avoiding bespoke conditions. This, too, will result in fewer notified consents and simpler processes.

Tāmati Coffey: How much is the repeal and replacement of the RMA estimated to cut costs by?

Hon DAVID PARKER: The new resource management system will deliver economic as well as environmental benefits. For every dollar spent, it’s expected to deliver benefits of between $2.58 and $4.90. On a conservative estimate, the benefit to users will be a 19 percent cost saving—or about $149 million a year, which equals to more than $10 billion in cost savings over 30 years. In addition, unduly restrictive planning restraints have contributed to New Zealand’s urban land and housing prices being amongst the least affordable in the OECD, and this will help turn that around too.

Question No. 8—Police

8. Hon MARK MITCHELL (National—Whangaparāoa) to the Minister of Police: What is the percentage increase of ram raids since 2018, and how many businesses have had security systems installed through the Small Retailer Crime Prevention Fund?

Hon CHRIS HIPKINS (Minister of Police): As the member is aware, there is no specific offence code for a ram raid, so the data available involves mining the text of all retail burglary descriptions. That data suggests that there were 84 ram raid - style burglaries in 2018 and 517 as of 21 November 2022—a 515 percent increase. In response to the second part of the question, as of 17 November, a total of 240 stores have been contacted by staff, 153 have now completed a police assessment, and a total of 362 security interventions have been approved and allocated to contractors. That includes 75 fog cannons or upgrades, 62 security sirens, 41 alarms, 53 CCTV systems or system upgrades, 40 bollards or similar security measures, and 36 roller doors. Many stores are also receiving improved lighting, strengthened windows, mirrors, and counter screens.

Hon Mark Mitchell: Point of order, Mr Speaker. My primary question was very clear. It asked how many systems have been installed.

Hon CHRIS HIPKINS: Mr Speaker, I can elaborate further on that. I don’t have data on the number of those projects that I’ve just mentioned that have been completed. The list that I gave is the number that have been approved and now sit with contractors. As to when they are completed, that will be a matter between the contractor and the store concerned.

Hon Mark Mitchell: Point of order, Mr Speaker. That is a primary question on notice. The Minister did have time to actually gather that information and data and bring it to the House. He should know, as the police Minister, how many security systems have been installed.

SPEAKER: When the Minister elaborated, he actually answered.

Hon Mark Mitchell: Why has a small business in Auckland had to endure 42 ram raids in the past 18 months and spend a quarter of a million dollars fixing the damage caused by ram raiders during a cost of living crisis?

Hon CHRIS HIPKINS: I am concerned about the increased incidences of ram raids, and that’s why the Government is taking proactive action to ensure that we’re following up on every one of those instances. No businesses should have to go through that experience.

Hon Mark Mitchell: How can the Minister tell the House that he’s taking proactive action when he can’t even come here and tell us how many security systems have actually been installed for ram-raided businesses?

Hon CHRIS HIPKINS: As I indicated, there are 362 security interventions that have been approved for installation. When that actually happens sits between the contractor who’s been approved to do the work and the business themselves. In terms of the individual number of stores, the 153 stores, I don’t believe it’s a good use of police time to ring 153 of them every day to ask whether the work’s been finished yet.

Hon Mark Mitchell: Well, is he suggesting that it’s a good use of police time to be going out and surveying stores to have bollards installed instead of actually being proactive and stopping the ram raids?

Hon CHRIS HIPKINS: If the member is now saying that we should stop this work, that would be an interesting argument for the Opposition to be making.

Hon Mark Mitchell: What support, if any, can he give to struggling business owners who can no longer afford insurance to protect themselves from a relentless crime wave?

Hon CHRIS HIPKINS: I’ve just indicated in quite a lot of detail the support that is currently being provided, and that is across the stores that have had the assessments completed to date, and that work continues.

Hon Mark Mitchell: Point of order, Mr Speaker. The question was about what support he can offer to business owners that can no longer afford insurance to protect their business because the premiums have gone so high, because of the amount of ram raids currently happening in this country.

SPEAKER: Yeah, and that was addressed. Question No. 9—

Hon Gerry Brownlee: Point of order! Mr Speaker, I’d ask you to also have a look at the answer given to Mr Mitchell’s primary question. The question on the sheet very clearly states, “how many businesses have had security systems installed through the Small Retailer Crime Prevention Fund?” Now, someone is paying out terminal invoices from that fund. It must be something the Minister knows and, in four hours of preparation, it’s not unreasonable for the House to accept there might be a specific answer—perhaps as low as seven.

Hon CHRIS HIPKINS: Speaking to the point of order, Mr Speaker. The member’s point of order itself explains the difficulty there. It can be some time after work is completed before an invoice arrives.

SPEAKER: To the point of order by the Hon Mark Mitchell, it was a supplementary question and it was definitely addressed. The Minister saying that he doesn’t know the number is actually an answer.

Question No. 9—Energy and Resources

9. Hon JULIE ANNE GENTER (Green) to the Minister of Energy and Resources: Will the Crown Minerals Amendment Bill help to enable New Zealand to phase out fossil fuel extraction; if so, how?

Hon Dr MEGAN WOODS (Minister of Energy and Resources): The bill will mean the Crown Minerals Act (CMA) will no longer actively promoting the prospecting, exploration, and mining of Crown-owned minerals, including fossil fuels. It will increase flexibility and allow the Government to manage the Crown mineral estate that enables fossil fuels to be phased out, while ensuring energy remains secure and affordable for all New Zealanders. The bill is, of course, just one part of our Government’s measure to reduce New Zealand’s reliance on fossil fuels and their extraction. We have already ended new offshore oil and gas exploration permits last term and have committed to achieving net zero by 2050. We’ve also set out a comprehensive plan for reducing our emissions in the emissions reduction plan, including an additional $650 million for our Government investment in decarbonising industry and the phase out of fossil fuels from the processed heat sector. We also have a commitment to phase out the use of coal for low and medium temperature process heat, and we also have a comprehensive energy strategy under way.

Hon Julie Anne Genter: Does she consider that the changes go far enough to be consistent with the International Energy Agency’s Net Zero by 2050 pathway, which requires no new oil and gasfields being approved for development from now?

Hon Dr MEGAN WOODS: As I indicated in the answer to the primary question, I believe that this change to the purpose statement of the Crown Minerals Act is an important part of a suite of Government energy measures and resources measures that need to be put in place for us to achieve our climate goals. Do I think this will achieve it on its own? No, no one measure will; they all need to work together.

Hon Julie Anne Genter: Does she agree that the Government needs to send strong signals to the energy industry to immediately stop investing in fossil fuels and invest in clean energy instead?

Hon Dr MEGAN WOODS: As the Minister of Energy and Resources, I take seriously my job to both promote investment in new energy generation and also ensure that we have the regulatory settings right to encourage that investment. I note, with some satisfaction, that we are seeing, at the moment, quite a change in the pattern of investment we’re seeing in energy generation in New Zealand. It’s not just the traditional generation we’re seeing built from our “gen-tailers” but are seeing a raft of independent generation projects coming on board in the renewable space. Just to name a few, the Rangitaiki solar power plant, that Todd-Sunergise are investing in—that’s $600 million into a 400 megawatt solar farm near Taupō. We’re also seeing Lodestone Energy investing $300 million into five solar farms in Northland, the Bay of Plenty, and Coromandel, and, of course, we’re seeing the work under way in offshore wind, with the partnership between Copenhagen Infrastructure Partners and the New Zealand Super Fund. This is the kind of investment we need to see in our future, not looking back to the past and thinking we can keep using fossil fuels for ever.

Hon Julie Anne Genter: How important does the Minister think the Intergovernmental Panel on Climate Change’s (IPCC) April report is, which states that to limit warming to 1.5 degrees Celsius above pre-industrial levels, we need emissions to peak at 2025 and essentially halve by 2030?

Hon Dr MEGAN WOODS: Of course, that report is incredibly important; it is one of a number of reports that are pointing to the fact that we need to have decisive climate action. This change to the Crown Minerals Act is just one measure that New Zealand is taking.

Hon Julie Anne Genter: Is the Minister confident that this legislation progresses change fast enough to meet the IPCC’s limit of 1.5 degrees Celsius and avoid climate catastrophe?

Hon Dr MEGAN WOODS: As I’ve indicated in previous answers, I don’t think there is one change or one measure that itself can solely do New Zealand’s job in terms of what it needs to do on climate action. I think this is a change that needs to occur. I think it is a change that we have well-signalled and been working on for a long time. In isolation, it is not enough, but when you put it together with a comprehensive programme of Government action on climate change, it is an important part of that suite of measures.

Hon Julie Anne Genter: Are the proposed changes to the Government’s ability to respond under this bill sufficient to enable “‘a rapid and just phase-out of fossil fuel production’ immediately”, as required according to a recent University of Manchester study?

Hon Dr MEGAN WOODS: Again, it is part of a suite of policies. It is an important part, but we need to see this as an important part of tranche two of changes to the CMA. Of course, in 2018, with the support of the Green Party and New Zealand First, we stopped the issuing of new offshore oil and gas exploration permits and joined a handful of countries that took a leadership position in this field. We’re now a part of a group of countries and regions, including Denmark, France, Greenland, Belize, Spain, Ireland, Quebec, and Sweden, who have seen that fossil fuels are not their future, and we need leadership that points to what a 21st century future looks like.

Question No. 10—Internal Affairs

10. GLEN BENNETT (Labour—New Plymouth) to the Minister of Internal Affairs: What recent announcements has she made about reducing gambling harm in communities?

Hon JAN TINETTI (Minister of Internal Affairs): Last week, I announced changes to strengthen harm minimisation requirements in venues that have pokie machines to reduce the harm they cause to people and their families. These include mandatory annual training for all staff dealing with gamblers, ensuring that staff in pokies venues are better trained; new requirements around the steps venues must follow to identify harmful gambling, such as regular sweeps and recording signs of gambling harm; two new rules around venue design that will support harm minimisation by ensuring staff can better monitor ATMs and pokie machines are less visible; and a range of new infringement offences that help penalise those who fail to comply with harm minimisation regulations.

Glen Bennett: Why are stronger harm minimisation regulations needed?

Hon JAN TINETTI: Pokies are known to be the most harmful form of land-based gambling in Aotearoa, with one in five players considered to be at risk from gambling harm. Data from the 2020 Health and Lifestyles Survey indicates that about 10 percent of New Zealanders use pokies, and while some may consider pokies a form of recreational fun, for far too many Kiwis and their families they do cause serious harm, including mental, financial, and social harms.

Glen Bennett: What feedback has she received on the proposed changes?

Hon JAN TINETTI: Given the level of harm caused by pokies, these changes are designed to drive a strong culture of care in class venues over time. I’ve heard some views from within the gambling harm prevention sector say that these reforms are positive but they are concerned that they don’t go far enough, and I agree. More systematic change is needed to reduce harm from gambling, which is why I have started work to scope a complete review of the Gambling Act 2003. As the Minister of Internal Affairs, I am committed to ensuring our regulations are working to reduce harm as much as possible and that we have the necessary enforcement tools for non-compliance.

Glen Bennett: What are next steps in reducing harm from gambling?

Hon JAN TINETTI: I expect that the new harm minimisation regulations for pokies will be in place in the first half of 2023, and, as mentioned, we have also committed to scoping out a wider review of the Act, which has been warmly welcomed from within the sector.

Question No. 11—Local Government

11. SIMON WATTS (National—North Shore) to the Minister of Local Government: How many, if any, parks and reserves that also serve a storm water function will be transferred to the proposed water services entities as part of the Government’s three waters reforms, and does she stand by all her statements on three waters reform?

Hon NANAIA MAHUTA (Minister of Local Government): The public can be assured that where the primary purpose of council-owned land is as a park, it will remain a park and remain in council ownership. In this instance, the public will have the same access to parks that they currently have and enjoy.

Simon Watts: On the basis that she will not confirm how many parks and reserves will transfer which also have a stormwater function, what does it say about these reforms that this far into the process, nobody is even able to confirm what assets will transfer into these entities?

Hon NANAIA MAHUTA: This will be the first time to comprehensively understand and identify the extent of the stormwater network and its profile. That’s why we established a Stormwater Technical Working Group to help provide a definition that would better ensure that we were capturing a range of stormwater assets if we integrated it into a waters network system. On that basis, I’m really pleased that the Stormwater Technical Working Group helped to define secondary water assets. All property whose primary or predominant purpose is not the delivery of water services will be clearly identified and listed in a schedule of assets that should not transfer from councils to entities. Ultimately, councils will help us identify what will not be transferred.

Simon Watts: Does she stand by her statement in the House last week that, I quote, “Councils have the ability to work with water establishment entities to decide which assets and land will transfer”, and, if so, will she commit that councils will be the ones to have the final say over the transfer of their assets to water services entities?

Hon NANAIA MAHUTA: I do, on the basis that the definition that was developed by the Stormwater Technical Working Group in relation to the predominant use of land can enable councils to make that decision.

Simon Watts: Does she stand by her statement made in the House earlier today that establishment of the principles of Te Mana o te Wai, and I quote, “included a number of stakeholder groups: the rural communities … Federated Farmers … industry users … horticulturalists, as well as iwi”, and, if so, why can only iwi submit Te Mana o te Wai statements in the Government’s three waters reforms?

Hon NANAIA MAHUTA: In developing Te Mana o te Wai aspirations in 2014, under the then Minister Nick Smith, it was important that those aspirations were communicated and engaged with across many communities. In terms of who develops Te Mana o te Wai statements—because this, essentially, is grounded in holistic concepts of relationships to water bodies—that is why the Water Services Entities Bill ensures that iwi mana whenua are developing these statements.

Simon Watts: Is it three waters or five?

Hon NANAIA MAHUTA: This is about ensuring we have safe drinking water, better environmental outcomes, ensuring that we protect source water—the use of it in whatever form—but also, when water gets discharged back to our lakes, rivers, streams and beaches, we won’t end up with no swim notices.

Simon Watts: Point of order, Mr Speaker. My question was six words: is it three waters or five? I don’t believe the Minister answered my question.

Hon Kieran McAnulty: The member referred to three waters in the primary.

SPEAKER: The question was definitely addressed. I counted; every member should have counted the number.

Hon Gerry Brownlee: Well, three or five? What was the count?

SPEAKER: Well, I’d encourage the member to go back to Hansard, and next time you want to speak to me, you should take a point of order.

Question No. 12—Workplace Relations and Safety

12. MARJA LUBECK (Labour) to the Minister for Workplace Relations and Safety: What steps is the Government taking to support the health and safety of workers?

Hon MICHAEL WOOD (Minister for Workplace Relations and Safety): Yesterday, the Health and Safety at Work (Health and Safety Representatives and Committees) Amendment Bill was introduced to the House. The bill delivers on a 2020 Labour manifesto commitment to ensure that all workers have access to health and safety reps in their workplace, should they request one. Health and safety reps play an important role in workplaces across the country already and have the power to request information and conduct inspections. Trained reps may issue a provisional improvement notice to address a problem or direct a worker to stop unsafe work. This legislation will ensure that when a worker makes such a request, the business in question will need to initiate an election. It also proposes ensuring that if at least five workers or a health and safety representative request for a health and safety committee to be established, the business will need to do so.

Marja Lubeck: What does the Health and Safety at Work Act currently provide for in terms of health and safety representatives?

Hon MICHAEL WOOD: Current legislation allows for businesses outside of specific high-risk sectors with fewer than 20 employees to decline a health and safety representative request from their workers and not make a decision on establishing a health and safety committee. This means that almost 29.3 percent of New Zealand workers do not necessarily have the right to request a health and safety representative or a committee, which we believe is a significant blind spot in the existing legislation.

Marja Lubeck: Is the Government making health and safety representatives mandatory?

Hon MICHAEL WOOD: No, we are not. Businesses will only be required to initiate an election where workers on that worksite request them, and workers may indeed prefer to engage in less formal ways, such as through regular health and safety meetings. None the less, we believe it is important that if workers determine that a health and safety rep would improve health and safety in that workplace, that should be able to proceed.

Marja Lubeck: Why is taking action on improving health and safety in the workplace so important?

Hon MICHAEL WOOD: While health and safety outcomes have improved since regulatory changes and the establishment of WorkSafe as a regulator, New Zealand does still have high rates of work-related harm in comparison to other countries. Rates of fatalities per 100,000 workers are roughly double those in Australia and about four times those of workers in the United Kingdom. We know we need to address this, and this legislation is just one step out of a comprehensive work programme the Government is undertaking to ensure that New Zealanders are safe and healthy at work.

Hon Paul Goldsmith: Supplementary?

SPEAKER: No. No more supplementaries for National.

Introduction of Bills

Introduction of Bills

SPEAKER: I understand it is the intention of the Government to introduce two bills.

CLERK:

Crown Minerals Amendment Bill, introduction

Local Government Official Information and Meetings Amendment Bill, introduction.

SPEAKER: Those bills are set down for first reading. I declare the House in committee for further consideration of the Water Services—

Hon Gerry Brownlee: I raise a point of order, Mr Speaker. Just a clarification: so the urgency motion yesterday—there was a Crown minerals bill in that motion. Is this a different bill?

Hon Chris Hipkins: No, it’s the bill that was in the motion.

Hon Gerry Brownlee: Well, if it’s introduced under urgency, what have we now got—why is it now being introduced? Is it not on the Table at the present time?

SPEAKER: The Government can introduce a bill at any time.

Hon Gerry Brownlee: The point is, Mr Speaker, with all due respect—

SPEAKER: Is it a new point of order?

Hon Gerry Brownlee: Well, it’s the same point because the urgency motion is, effectively, an introduction of the bill, so we’re, effectively, doing that twice.

Hon Chris Hipkins: Speaking to the point of order, Mr Speaker. When the member, the Hon Gerry Brownlee, was the Leader of the House, it was usual for the Government to pass an urgency motion that would have the words “and other bills to be introduced by the Government”. The Standing Orders were changed, some Parliaments back, to require that the Government be more specific in terms of which bills would be considered under urgency. There is not a requirement for those bills to have been introduced at the time that motion is moved; so the motion moved yesterday included some bills that had yet to be introduced, two of which have now been.

SPEAKER: It’s Standing Order 292 for members. I declare the House in committee for further consideration of the Water Services Entities Bill.

Bills

Water Services Entities Bill

In Committee

Part 2 Water services entities (continued)

CHAIRPERSON (Greg O’Connor): Members, the committee is resumed on the Water Services Entities Bill. When we suspended earlier today, we were considering Part 2. Once again, the question is that Part 2 stand part. I just will indicate, before I give a call, that the presiding officers do communicate between sessions and that we do keep a very close eye on what is happening, to ensure the continuity.

SIMON WATTS (National—North Shore): Thank you very much, Mr Chair. It’s good to be back after lunch to get more into this bill, because I think we would all acknowledge there’s plenty of content here, and I do acknowledge the other members around the Chamber who have contributed, from both sides of the House, to questions as we go through.

My questions are in regards to Part 2, specifically on clauses that we haven’t touched on to date—clauses 42 and 54. While the clauses, in those regards, are both part of different subparts and relate to different groups under the governance model, I think it is appropriate there is some correlation between the points. This is around co-chairpersons and co - deputy chairpersons.

The questions that I have in regards to this point are—look, we’ve traversed the conversation around co-governance and the challenges and that around the make-up of the groups, but the point around the introduction of the concepts of co-chairpersons and co - deputy chairpersons, I think, raises a number of questions in terms of the ability to try and simplify the governance of these groups, or, actually, does that actually introduce more complexity.

So the questions I have for the Minister, in regards to that, are: what was the rationale in regards to putting in place, through legislation specifically around those roles—how does the Minister see those roles, in terms of co - deputy chair and co-chair, actually working in practice? And does the Minister believe that that model is going to enable these governance groups—which I think we would all agree are new and are going to be finding their feet in regards to undertaking this role; is the addition of that co-element going to help or hinder the effectiveness of those governance groups? Because the reality is that these entities are going to be managing significant assets. I refer to Schedule 2 of Part 2 which refers, in four parts, to all of the different council territorial authorities that will form part of these groups. I think, in regards to that, that would be helpful.

The second question I’ve got is in regards to the points around clauses 56 to 59, specifically around clause 57, which is in regards to—this is Subpart 6 of Part 2, “Boards of water services entities”, again an area that we haven’t traversed to date this morning.

Shanan Halbert: It sounds the same as your last speech.

SIMON WATTS: My question in regards to the—sorry, I didn’t hear that question from the member on the other side, from Northcote, but I’m happy to answer. Maybe you could take a call and let the Minister answer the question. But I do acknowledge that members on the other side do have a number of questions about this bill, which is probably quite reasonable.

But let’s get back to that. Clause 57—there’s a lot of enthusiasm on questions all around the Chamber on this—is around the membership of that board, and, in particular, the overview in terms of the skill sets and aspects that have been determined there. I think it was raised, potentially, in an earlier contribution, not in relation to this clause, but of another, around the mechanism in which it has gone through to determine that that is going to fulfil and suffice the requirements that will be required for overall governance of this—because, again, this is a new concept. It is a concept in which these individuals—and up to 10 individuals, if I’m right—will have significant influence and control over the success of these entities. And it’s success, actually, that is outlined in clauses 10, 11, 12, and 13 of Part 2—obviously in relation to the objectives, functions, and operating principles. I’m keen to understand a little bit of the rationale around that and also in regards to the interrelationship between that board entity and the regional representative group, which, again, there is some detail in clause 59, but I think some clarity around how that actual overall governance model is going to work would be much appreciated.

ANDREW BAYLY (National—Port Waikato): Thank you, Mr Chair. Now, I thought I might look at something new—

Shanan Halbert: Oh, throw something different in there, Bayly.

ANDREW BAYLY: Can the member repeat himself?

Shanan Halbert: Throw something different in there—new points.

ANDREW BAYLY: The member obviously wasn’t listening when he asked me to talk about something different—

CHAIRPERSON (Greg O’Connor): Could members take their conversations outside, if they need to have them.

ANDREW BAYLY: —because that’s exactly what I’m about to do. The member for Northcote obviously doesn’t listen very closely.

I want to talk about clause 114, “Duties to provide funding and information”, and it does slightly relate to what my good colleague Simon Watts here has just been talking about. Here we have these new entities that will have not only co-chairs but co - deputy chairs, so it raises in terms of governance structures what is a very, very unusual structure. In fact, in all my years of commercial dealings, I don’t think I’ve ever yet come across an entity, a board, or suchlike that has co-chairs and co - deputy chairs.

Penny Simmonds: It’ll get co-leaders too, for sure.

ANDREW BAYLY: Oh, co-leaders too, Penny Simmonds has identified. It’s unbelievable. It’s a very, very, very complicated structure, and of course clause 114—which I know the Chair is reading very closely—relates to the funding of this. This is about how much do you pay these people. So I was just doing some sums there in terms of the cost that this might be, and of course we’ve got the Minister who said that this is all about reducing costs and delivering bigger value. But reducing costs, even though I understand that we’re going to take on more employees in these four entities, certainly at a governance level, we will inevitably end up with more people.

Now, I was just working the numbers. If you assume you that you have a board of 14 and you pay them $30,000, that’s about $420,000. But, of course, if you have a co-chair—well, chairs normally get paid more than $30,000, they normally get $50,000, so it’s $100,000 between the two of them. And if you have a co - deputy chair, well, what would you pay them? I’m looking at my good colleague, the Hon Louise Upston, and she has a good view on this. I reckon you’d pay them, what, $45,000, $40,000, or—I don’t know—$80,000. So hey, just for this one board we’re over $500,000, and then of course, as the Minister who was in the chair before lunchtime was saying, “Well, of course you’re going to have more people on this board if the people on the initial board decide to have more representatives from council.” Hey, I can see this blowing out to a million bucks, eh?

Of course, the middle one has, what, 22 councils—22 councils. Well, I’ve heard some very strong arguments from my good colleagues, who have said that those people need to be represented on these boards. I subscribe to that view because of course that’s what we’ve heard from the mayors who turned up in places like Hamilton and Nelson to say, “We’re not getting adequate representation on these entities.”, and that’s right—they’re not. But to say, “Oh, we’re going to reduce costs.”, well, I can say that at a governance cost, I reckon we’re looking at the best part of 3 million bucks, because of course clause 114 not only talks about the regional representative group but it talks about the regional advisory panel, and we’ve got lots of those, haven’t we? Then we’ve got the board costs, which, I think, are 3 million bucks.

So my question to the Minister is: what is the framework for the payments of these, what will be paid, how will it be determined, and will the cost be nearly $3 million? I think that is a pretty good calculation of what the overall cost will be for these entities, and so I think that if you look at it, that’s going to be per entity, given the scale of this for each regional advisory board, regional representative board, and the board itself, let along what we’re going to pay these CEOs, because these CEOs are now going to be based on a payments system that’s probably different from what they’re getting paid now. Because they’re going to be big shots running big entities, I’ve no doubt they’re going to be on lots and lots of money, right? We’re going to see them right at the top of the public sector, aren’t we—the top of the public sector—in terms of their payment rates.

ANNA LORCK (Labour—Tukituki): I move, That the question be now put.

PENNY SIMMONDS (National—Invercargill): Thank you, Mr Chair. Following on from my colleague Andrew Bayly, and I know—I was going to say yesterday but it might only have been this morning, Mr Chair; it seems so long ago—you called me up once when I started to look at the comparisons between the centralisation of the polytech sector with this centralisation. But Mr Chair, I would contend that it’s absolutely relevant because the sort of cost escalations that my colleague Mr Bayly was talking about are what is worrying me enormously around—

CHAIRPERSON (Greg O’Connor): Your contention and my determination may differ, but carry on for the time being.

PENNY SIMMONDS: Thank you, thank you very much. So if I can give you the example of just on the radio this morning, Minister Hipkins has confessed that there will be somewhere between low hundreds of millions to mid hundreds of millions being needed to be spent to get commonality around the software applications needed to consolidate that many entities together.

I guess what I’d like is some assurance from Minister Mahuta that, in fact, that’s been thought about this time. Because for the centralisation of the polytechnics, it obviously wasn’t thought about and it’s coming up now that this centralisation isn’t costing the $200 million that was budgeted for, but in fact half a billion just to get the operating systems there to allow it to actually work together—centralised, working together.

I’m sure we will find the same thing within the local authorities—that they will have different operating systems; they will have different IT systems. So I’d like some understanding that the Minister has worked through that, has thought about that, and actually has costed that in. Because saying that there will be savings is easy to say, but it’s very hard to take when after the fact—now we’re talking perhaps half a billion more costs.

Just also, the other part that I want to ask about with the Minister—so looking at Part 4 in Schedule 2, which is the lift of the local authority entities. There are 20 different entities there, with Marlborough District Council and Tasman District Council, that also have part of their area within the Southern Water Services.

So my understanding is that there might be 12 or 14 representatives. With 20—possibly 22—different district councils, it would appear that the majority of these district councils will not have a representative on the boards. And we’ve talked about these smaller councils being worried about: one, their loss of millions of dollars’ worth of assets; and secondly, having no voice at the table when decisions are being made about what happens with their assets.

So we’ve talked a little bit also about the mana whenua appointments, and I don’t believe it was addressed by the Minister when I asked about the process in terms of an iwi like Ngāi Tahu that covers such a big geographic area, that if there are no conditions or requirements about those mana whenua appointments, they could well be from only one geographic part of the southern region—i.e. Christchurch—and so there may be no mana whenua representation coming from the bottom one-third of the South Island. I don’t believe any assurance was given around that.

I know with other iwi it won’t be such an issue, but for Ngāi Tahu, they are covering a huge part of our land mass in New Zealand and I don’t feel we’ve been given any assurances there. So how many of the 22 councils are going to miss out on having any voice, and how will those mana whenua appointments occur?

BARBARA EDMONDS (Junior 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 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Motion agreed to.

CHAIRPERSON (Greg O’Connor): The question is that the Minister’s amendments to Part 2 set out on Supplementary Order Paper 306 be agreed to.

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

Ayes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Amendments agreed to.

CHAIRPERSON (Greg O’Connor): The question is that the Hon Eugenie Sage’s amendment to clause 13 set out on Supplementary Order Paper 307 be agreed to.

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

Ayes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Amendment agreed to.

CHAIRPERSON (Greg O’Connor): The question is that Simon Court’s amendment to clause 13 set out on Supplementary Order Paper 292 be agreed to.

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

Ayes 43

New Zealand National 33; ACT New Zealand 10.

Noes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Amendment not agreed to.

CHAIRPERSON (Greg O’Connor): Simon Court’s amendment to clause 13 set out on Supplementary Order Paper 305 is ruled out of order as being contrary to a previous decision of the committee. Supplementary Order Paper 305’s Part 1 amendments were voted down; substantive amendment in Supplementary Order Paper 305 is clause 6, part 4. Amendments are consequential.

The question is that Simon Watts’ amendments to clause 27 set out on Supplementary Order Paper 287 be agreed to.

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

Ayes 43

New Zealand National 33; ACT New Zealand 10.

Noes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Amendments not agreed to.

CHAIRPERSON (Greg O’Connor): The question is that Simon Court’s amendments to Part 2 set out on Supplementary Order Paper 293 be agreed to.

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

Ayes 43

New Zealand National 33; ACT New Zealand 10.

Noes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Amendments not agreed to.

CHAIRPERSON (Greg O’Connor): The question is that Simon Watts’ amendment to clause 45 set out on Supplementary Order Paper 288 be agreed to.

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

Ayes 43

New Zealand National 33; ACT New Zealand 10.

Noes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Amendment not agreed to.

CHAIRPERSON (Greg O’Connor): The question is that Simon Court’s amendments to clause 57 set out on Supplementary Order Paper 294 be agreed to.

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

Ayes 43

New Zealand National 33; ACT New Zealand 10.

Noes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Amendments not agreed to.

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

Ayes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Part 2 as amended agreed to.

Part 3 Operation of water services entities

CHAIRPERSON (Greg O’Connor): Members, we now come to Part 3. Part 3 is the debate on clauses 115 to 128 and Schedule 4, “Operation of water services entities.” The question is that Part 3 stand part.

Hon NANAIA MAHUTA (Minister of Local Government): As we move on to Part 3, it’s important to remind the committee that core to the design features of this water reform was to ensure that we had a public model for water service delivery that would safeguard against privatisation, in the interests of all New Zealanders. In this particular part, we have protections against privatisation. However, can I say that there will be many around this House who will feel, and also to those who are listening, that we should have gone further, and the Government wanted to go further. We wrote a letter to every party in Parliament, seeking their support to entrench a clause within the legislation to give an absolute assurance that privatisation would not occur. That is certainly the view of members on this side of the House and the Government. However, National and ACT clearly did not want to give that type of assurance.

We regret that, because, when we stand in front of this House to progress this particular bill, we want all New Zealanders to know that the House, when they say they’re against privatisation, actually mean it—when they say they are against privatisation, they mean it. But some people want to create a perception that they don’t want privatisation; however, they are offering up ways in which you could better privatise the system, and we have already seen what happened in relation to the electricity reforms. So this particular part has a protection against privatisation as best as we could achieve. It ensures that contracts and joint arrangements are lessened from 35 years to 15 years, and there are members around the Finance and Expenditure Committee who are able to actually tell the story.

But just a little insight: Labour supported initially, within the context of local government contracts, 15-year contracts, because we knew that that would deliver local advantage. It was the National Party that changed the legislation to 35-year contracts, and some of those contracts now are not held by New Zealand companies. We want to see a return back to contracting locally. We want to ensure that those who are already in the service delivery space of the water sector, those small plumbers or those medium-sized enterprises, can grow and they’ll have the opportunity to do that. Part of the rationale of bringing the contracts back to a 15-year period will give a horizon of growth to those medium-sized entities, to be able to be strong contenders, to secure contracts within their local regions, and I support the select committee in their considerations on this front.

There are also employment provisions within Part 3 that are clearly outlined, and I am sure that there may well be members around the select committee who can add value to the conversations that they had around these provisions. But, insofar as a water services entity is concerned, it is actually our ambition to ensure, right from the get-go when these entities are established, that they will be good employers. So I welcome, again, the addition and the recommendations of the select committee in clause 120(2)(i) and (j) of the bill, where they said, in (i), we want to “recognise the importance of achieving pay equity between female and male employees” and, in (j), “recognise the importance of decisions about remuneration being free from bias, including, but not limited to, gender bias”, because we know, in certain sectors, across industries, and especially hard infrastructure industries, there is a significant difference. But, heck, let’s be real: we know that there’s a significant gender pay gap across a number of sectors. So I’m really glad they wrote that into the legislation. It makes absolutely clear our intent.

In terms of the role of the water service entity and the professional board that sits over it, let me just assure, for the sake of clarity—and I am impinging on the will of the committee—the professional boards that direct these water service entities do not have co-governance around the board; it is skills based, and it ensures that we have the very best skills to guide and direct the role of the water service entities. There’s a bit of conflation that’s been happening around the committee in relation to the role of these boards, but what we have learnt, in terms of Crown entities, is that we migrate many of the provisions of Crown entities to the professional direction of these entities that we are standing up. We know that we can continue to ensure, for the public’s interest, that the requisite skills will be there to direct these four entities.

SIMON WATTS (National—North Shore): Well, thank you very much, Mr Chair. It’s difficult not to reflect on some of the comments that the Minister for Local Government has just made in regards to Part 3, and particularly around the privatisation aspects. This is cynical, political spin. Right from the outset, the Labour Party have used every opportunity to bring up this concept of privatisation. And do you know what? The only ones talking about privatisation are those members on the other side of the House. At no stage throughout this process has this even been a conversation or a topic in which the National Party has entertained. Categorically, to that cynical spin that was being pushed into the market by whoever, we were very categorical and continue to be categorical in that there is no intention around nationalisation of such assets.

So the Minister’s playing out this conversation around “Well, you’re not supporting this.” Well, how the heck can you support it when it’s bound up inside of a bill that is fundamentally structured to fail? Well, you can’t. It’s not a bill standing out by itself or anything like that. So it is what it is: cynical, political spin, and Kiwis can see through that.

The clauses I want to get into in regards to Part 3 relate, in particular, to the contracting out of services. The Minister made some throwaway comments in her opening introduction around changes—and that’s great. She actually sent quite an interesting signal to the market just in her statement there, particularly to those private entities that have strong and long-lasting relationships with councils across this country. If you come from overseas, you’re not welcome in this country—that’s what the Minister has just said in regards to those organisations that may be based overseas or have head offices overseas that have been contributing and delivering water services in this country for decades and decades. The Minister has said, “You are not welcome and things are going to change, we’re bringing it home.” Well, that’s interesting. It’s interesting in a couple of facets. But it very much, I think, fundamentally goes to the heart of an ideological reform agenda driven by this Government that is not based on trying to get a bill that is going to be sustaining and outlast this term of this Government but a bill that is actually going to deal with the problems that we face in this country.

Every major party in this House acknowledges that reform and change and improvement and water infrastructure across this country is required. We’re all at that point, even though there’s a cynical, political spin that comes in and says that we don’t. It is absolute rubbish to have any other position around that.

But the point around this contracting out, in regards to clauses 117 and 118 in particular, relate to the comments—and I’m interested around the comments from the Minister in regards to can any organisation that isn’t New Zealand headquartered or a multinational that’s currently working in water services in New Zealand, can those organisations take from what the Minister has just said that your lifespan in this country is not going to last longer than 15 years? It’s all over, you might as well actually just pack up and head home with all of those skill sets and capabilities and values that you bring to this country, to try and improve our infrastructure. Is the message that you’re sending to all of those private multinational companies that are currently consulting and spending a huge amount of money on consultants who spend on this reform that we’re paying through the nose for—is the message to them “Go home”? That is, in effect, the statement that has been made around this Chamber.

If that is the case, my question to other Kiwis around this country is that what we need in this country in regards to achieving an optimal future State where we have best-in-class infrastructure, we have fresh and clean drinking water, is that what you’re saying? That is a market signal that couldn’t be much more categorical than what we’ve heard today.

So the question there—clauses 117 and 118; I’m interested in the Minister’s perspective on that. Also, the comments, obviously, around privatisation—115. And I’ll come back in another call in regards to some questions I have in regards to the employment matters in regards to the bill. Thank you.

CHRIS PENK (National—Kaipara ki Mahurangi): Thank you very much, Mr Chair, for the opportunity to contribute to this debate, which I’ve been enjoying, as, no doubt, everyone else who’s following—some excellent interrogation by colleague and friend Simon Watts, as well as others. I acknowledge the Minister answering questions, I hope that she can give some guidance to the House—and indeed, the nation—on three specific points within Part 3.

The first is in relation to clause 116, “Obligation to maintain water services”. I note at clause 116(2), that the water services entity is specifically precluded from doing any of the following, and the one I do want to hone in on, which is at clause 116(2)(a), “use water services infrastructure as security for any purpose”. Of course, in the language, “security” meaning the ability to secure a loan, to offer as what is sometimes referred to as collateral.

In other words, we have a piece of legislation that specifically says that it’s not possible to use the value of these assets, which will be considerable—that much is common ground between all the parties; we all understand that these assets cost a considerable amount of money. And it will not be possible to borrow money, acknowledging the value and using that as security for it, which in orthodox financing arrangement terms is an extraordinary opportunity-cost. I just wonder if the Minister can explain some of her thinking as to why that is a feature of this legislation. In a context where the political explanation has evolved over time to be that ratepayers’ rates would go up were it not for the very specific form of these changes being made by the Government, it does seem extraordinary that they’re going to do things the hard way. So that’s the first point on which I would appreciate a response from the Minister.

The second is in the very next clause, clause 117, “Contracts relating to provision of water services”. This talks about the 15-year contract limit. My colleague and friend Simon Watts has already spoken about the implications of that and what kind of a time frame, and, actually, to be fair, the Minister herself has spoken in that general area as well in her previous contribution.

My question is whether it’s possible, given this clause, to have a contract for 15 years, or up to 15 years, but with the right of renewal for longer. So, technically, looking at the wording of clause 117(1), “a water services entity may enter into a contract for any aspect of the operation of all or part of water services for a term not longer than 15 years”—but that could be an initial term. So I wonder if the Minister can rule out the possibility that a water services entity enter into a contract, let’s say for 10 years, but with a right of a renewal with certain conditions being met for a further 10 and then a further 10 after that—so a 10 plus 10 plus 10 arrangement. I do see the Minister following along closely, for which I thank her.

I’ll just raise, within my remaining time within this call, my third and final question within this part—at least for now—which is at clause 127, “Method of contracting”. Others have well-traversed the make-up of boards; of being different kinds of board members, from mana whenua and more generally, from a local government context—or “territorial authorities”, I think they’re referred to within this legislation and elsewhere on the statute book.

I see that an obligation can be entered into in the form of a deed requiring at least the signatures of two board members, so possibly more. I wonder if it would be prudent, and if the Minister has considered saying—as would often be the case for joint-venture type arrangement, whereby at least one of those members who is a signatory to such a deed should be from one category of board member or other. The obvious point would be that if you had at least one board member from one side of the equation, so to speak, and one from the other, whether you’d categorise it as a joint venture or co-governance, etc.

Nevertheless, it does seem important, given what we understand the rationale of the legislation to be, that you would have at least one person from each of those different perspectives needing to sign off, otherwise it could be two from one side or two from the other, at a minimum, without the input of the other. That does seem contrary to the notion of partnership that’s being promoted as the rationale for this legislation, and, indeed, the changes as a whole.

Hon EUGENIE SAGE (Green): Thank you, Mr Chair. So on this Part 3, the Minister noted that the Finance and Expenditure Committee had made several improvements to it, and one of the other improvements to it was to ensure that in clause 115, “Safeguarding independence of water services entities”, there was also no attempt at safeguarding the ability of territorial authorities to carry out their normal regulatory functions, so I’m making that very clear. But one of the key changes is around this contracting out, because there was quite a lot of comment in submissions, particularly from local communities and from the local contractors who might already provide some services to councils, around the importance of their businesses locally. And going back to the original provision in the Local Government Act, as the recommendation of the select committee was, to a 15-year term does provide some protection against contracting out to big overseas companies like Veolia. There is a strong opposition amongst the public to having our water services managed and operated by overseas corporates which are more interested in dividends going back offshore, wanting them to be managed locally. So that 15-year term, which is totally consistent with the Local Government Act before the National Party changed it and extended it up to 35 years, is something the Green Party strongly supports.

There is also Supplementary Order Paper (SOP) 285 in my name which really reinforces the obligation on the water services entities to continue to maintain and provide water services, because there was, again, from the Aotearoa water organisation and many individual submitters, a strong concern about privatisation and a desire for provisions which protected against that and for these to be entrenched, particularly in submissions also from the local government sector. As a departmental report noted, and I quote, “Many submitters noted that while there was no current appetite in Parliament for water assets to be privatised, this could change in future, as we saw under a former National Government with the privatisation of electricity assets.” So the Green Party supports—and the Government did explore and we explored in select committee—entrenching provisions in the bill.

So my SOP seeks to entrench clause 116 and Schedule 4, which relates to divestment, through a tabled amendment to the SOP so that there is an obligation to maintain ownership and control of water services and significant assets. This SOP would mean that this reserve provision, clause 116 and Schedule 4, couldn’t be repealed or amended unless a 60 percent majority of all members of the House supported that and that it had been carried by a majority of the ballot votes cast at a poll of electors of the general and Māori electorates. This SOP responds to that public concern that we avoid privatisation of water services and we maintain them and public ownership—with the public interest in ensuring that all New Zealanders have access to affordable water services of high quality. And that the significant revenue involved in operating these services, significant investment involved—we don’t want overseas companies taking the services and operating them primarily for profit. So while there was certainly advice to the select committee that normally entrenched provisions relate to constitutional matters, water is essential to life, so it is of sufficient importance that these services are maintained in public ownership. I hope that National will reconsider its opposition to entrenchment to signal that it does support maintaining public ownership and investment and support this SOP 285.

Hon NANAIA MAHUTA (Minister of Local Government): Mr Chair, on the matter of joint contracting, I really want to clarify statements that have been made in this House to try and position the Government, but wrongly so. On the issue of joint contracting, the justification for bringing the contracts down from 35 years to 15 years—which was considered by the Finance and Expenditure Committee—I think, had sound consideration. That was to open up the opportunity for local procurement to take place. Now, I have met with peak bodies of the water sector stakeholders every year since I have been a Minister of Local Government, and I’m really encouraged because that organisation is growing. I’m encouraged because even though there is international participation in that body, they understand the importance in the water sector to contract locally. Why? Because residents, ratepayers, need the ability to pick up the phone and know that someone who knows their community is on their way to actually fix the pipes. It’s that simple. So there is no conspiracy here about limiting big offshore providers, but there is every opportunity under these water reforms to ensure that local procurement takes place. And those are the interests that members on this side of the House that support the bill want to ensure. We heard the views of communities, they were pretty sceptical about whether or not local contracting will continue under reform and a model that looks to create these four large entities. It will continue.

On the matter of privatisation and prior to expressing a view on Supplementary Order Paper (SOP) 285 that Eugenie Sage has tabled in this House, there are a range of protections in the legislation on this instance. Seventy-five percent of the regional representative group need to agree on a matter of that significance, and if they agree, 100 percent of territorial authorities need to agree on that particular issue of privatisation, and if they agree, 75 percent of electors will need to participate. So we have worked as best we can to bake in protections against privatisation, because members of this Government do not want to see that happen in the water sector as we’ve seen elsewhere—such as in the electricity sector. On that basis, and it’s important to be able to respond in a way that puts into context why then we didn’t have an entrenchment clause, a stronger provision, in the legislation.

We accepted the advice of the Attorney-General, which says that there is a high constitutional threshold. And that came from the Crown Law Office—select committee members will be well aware of that advice. There is a high constitutional threshold to be reached in order to put such a threshold within legislation, and often it’s on constitutional matters—of which this bill is not—and it would be a novel approach to include an entrenchment clause. However, in saying that, I think that the member for the Green Party who has put up, still, and tested the will of the House in relation to having an entrenchment cause is a worthy matter to be considered, because at least the Government and the Greens are very clear about our position on privatisation: we don’t want to see it. Again, we wrote a letter to every party in the House. They did not agree. But if people who are listening to this debate are concerned about having maximum protections at every level, then it would make sense to have a novel approach of an entrenchment clause if it were able to be achieved. We know that while this particular SOP may not pass the constitutional threshold, there is a moral obligation of people who believe that privatisation should not occur to support that particular SOP.

Just in terms of ensuring, for completeness’s sake, we’re addressing the issues that were raised in the House, the member brought up concerns in relation to—forgive me—I think it was clause 127 of the bill. When I look back at the report of the committee, there were no actual submissions on that particular clause, but I may take the opportunity further on in the debate to actually come back on those particular issues. There were no submitters that submitted on the concerns that he’s raised, so I take it at face value that he read the bill and it raised concerns in his own mind.

MARK CAMERON (ACT): Thank you, Mr Chair. Clause 118 in Part 3, I’m just trying to get my head around. Minister, you’ve made some statements about joint contracting realities, and they will stay in play. Again, I’m going through the lens of rural New Zealand, and you spoke of local procurement that’s existing and in place. I draw your attention to clause 118(2)(c), which says, “any other interested persons that the board considers appropriate.” In that instance, is there not the potentiality that existing contracts could be undone if there is objection at a board level by a person or persons that the board considers appropriate?

Again, when you actually think about that in a rural context, a lot of these contracts have been—I won’t say multigenerational but they’ve been in play a long time. Is there potential in this legislation to undo existing agreements at catchment level, local drainage board level, and have it taken over to one of the major entities? You can see how this is quite convoluted. Can you please explain that for rural listeners in New Zealand who are deeply concerned about where this goes and how it affects their local assets?

ANDREW BAYLY (National—Port Waikato): Thank you, Madam Chair. A changing world, isn’t it? It’s a fast-moving world. Hey, I think we just heard it from the Minister that we’re going to have a clause put up by the Green Party that there will be no privatisation—I think we’re going to find out, what, in another couple of hours? I don’t know—when we get through this next part. But if you’re listening in, you’ve just heard it; you heard that there will be a clause.

Hey, look, it is absolutely unnecessary. The chances of privatisation, as laid out in this bill, are virtually nil, because it’s got to go through the board, it’s got to go through the regional representation group—75 percent—and then it’s going to go back to the council, they’ve got to sign off, and then you’re going to go through the public, and they’ve got to sign off—a super majority all the time. There’s not a hope in dickens that that’s going to take place. And so you don’t need the clause, Minister; it is a waste of time, because it is never going to be able to be privatised under the current arrangements.

Anyway, I want to turn to this issue about contracting, because aw—that’s another form of privatisation, isn’t it? And I’m referring to clause 117 if you’re just looking at the bill. Gee, it’s horrible having those foreigners, those experts from overseas! You know, “Nice that you come here for a bit of tourism, but don’t ever have anything to do with managing us or telling us what to do in New Zealand, because we don’t like you! We only like to suck your money out of you if you happen to come to New Zealand as a tourist from overseas!” That’s the view—that’s the weird view—that you get from the other side: “Don’t tell us what to do with our water assets.”

So I look at this clause—117(2). It reads: “If a water services entity enters into a contract … it must—(a)”—and this is for Mr Shanan Halbert from the North Shore, because he’s had a bit of difficulty listening to this—

Hon Member: Northcote.

ANDREW BAYLY: —Northcote—“continue to be legally responsible for providing the water services;”. So even if you contract out, the water services entity is still legally responsible. The second thing: “(b) maintain ownership of the infrastructure and assets relating to the water services;”. Well, that means you can’t sell it. So that’s the second requirement if you’re contracting out. The third one: “(c) retain control over”—guess it—“(i) the pricing of water services; and (ii) developing policy related to the delivery of water services.”

Well, hey, don’t you think that’s a pretty comprehensive sort of restriction on what you can do under the contracting model? And yet—yet—the Government is so fixated on this issue about contracting out because we don’t like these people from overseas; they’re bad people! They’ve now reduced the contracting period from 35 to 15 years. So the first question is: if we were to get some expertise in—and, gee, don’t we need it in New Zealand, particularly with the way that these guys do infrastructure projects, or the lack of them? Maybe they should get some people in to help—I’m talking about the Labour Government—and get some experts in from overseas to help them actually do some infrastructure projects, like a road, let alone doing any water projects.

Has anyone actually asked what is the optimum, if you did want to get some expertise? We’ve got experts in doing the tunnelling in two projects in Auckland right now, but we could not contract them for more than 15 years. Has anyone actually asked what are the standard terms for people to take on contracting periods, and particularly if you want to bring in someone with expertise? These are the types of contracts that they will need scale to actually be able to do. And yet, for some reason, and I’d love the Minister to explain why, we’ve got 15 years. Where has that evidence come from that 15 is the optimum? And, in fact, if you wanted to go down that route of trying to get some experts in, and 15 years is the maximum period that you can get away with, I would suggest there are many examples of people wanting to do it for longer.

PENNY SIMMONDS (National—Invercargill): Thank you, Madam Chair. I’m interested in taking a look at clause 119 and clause 120, particularly, in Part 3. So clause 119 is the “Employment of chief executive”, and clause 120 is “Water services entity to be [a] good employer”—and I note that the Minister spent some time on this, about being a good employer. Now, in my time as—what I hope was—a good employer, two of the key parts to being a good employer were acting in good faith and not indulging in pre-determination.

So I’m quite interested to see, or to hear from the Minister, around how the appointment of a chief executive of a water services entity in clause 119 “(1) is to be appointed by the entity’s board”; (2) the terms and conditions of employment [are to] be agreed between the board and the chief executive.” And then there’s a range of factors there—“(3) … (a) the legal, commercial, and operational context of the entity … “(c) public interest and prudent stewardship of public resources”, and, importantly, “(d) relevant market information.” So I’m interested to know how these positions have been advertised already before the legislation has been passed. And is that a good employer acting in good faith, and is that a good employer not showing pre-determination? Because you would have to wonder about the consultation that’s going on, particularly as we sit here hour upon hour, trying to work through clause by clause where we might be able to improve this legislation that the Minister—as she did with the 88,000-plus submissions, actually has no intention of taking any notice of, because it has been pre-determined. So a consultation period, a consultation process which actually isn’t going to have anything taken from it because the positions have been advertised; the employment conditions haven’t taken into account anything that might possibly change as we work through this process. So I’m very keen to hear from the Minister, who was at pains to say how important it would be to act as a good employer.

Now, I know I keep harking back to the purpose about efficiencies, and I know that is in Part 1, but of course the matters in here around employment and being a good employer also impact on that purpose of being more efficient, more affordable, and more of a better performance. And so I’d like the Minister to explain—and this has come from a regional council, where they have talked about their staff being pinched already for these entities and being paid $30,000 more a year. I’m just interested to know—and again, because I’ve seen it happen so badly in the failed merger of the polytechnics and the international training organisations, that they’ve taken reasonably, moderately-paid people and they’ve increased the head office with, hugely, what I would consider are overpaid people. And so it looks to me like this is starting to happen already, before the legislation is through. If employers are being pinched off the regional, local authorities now, and those sort of offers of $30k more—I’m really, really struggling to see how this entity is going to be more efficient, more cost-sustainable, and perform better by paying more for people to do the same jobs, and at the same time, we’re going to cut down on external contractors.

BARBARA EDMONDS (Labour—Mana): Thank you, Madam Chair, and congratulations and thank you for stepping up to be a temporary Chairperson given the sickness on our side of the Chamber. We thank you very much for that.

I want to respond very briefly to Andrew Bayly’s comments on clause 117. I know he has directed the question to the Minister and she may respond to that, but my concern with that is that Mr Bayly was part of the select committee process that actually made the decision to make this amendment from 35 years down to 15. So he’s asking the Minister what were the considerations the select committee went under to get to this point, from 35 to 15. The Hon Eugene Sage also spoke to that in the Chamber earlier today, so some good listening skills would really be appreciated because then we wouldn’t have to repeat what we did at the select committee and what we did here in the Chamber.

So let me say again, for the purposes of the Chamber—because it was the select committee that recommended it. It was also in the commentary on the bill, which, again, the member can read. The time limit set for the term of contractual arrangements represents a balance between flexibility and enabling long-term assessments that support cost-effective procurement and service delivery, especially given the long-lasting nature of water services infrastructure. That, again, was part of the select committee process. I remember that member asking a particular question and saying, “Why have we gone to 15 years? We agreed to 35.” And, again, officials answered it on the spot. So I ask the member to go back to the commentary on the bill and have a good read of it, because this particular change, from 35 to 15, was something that the select committee took a cautious approach to, and that’s the reason why it’s in this bill.

What I did want to ask the Minister about were clauses 120 and 121. The select committee did spend a lot of time reflecting on what could be a good employer, and we received a number of submissions on what could be a good employer. That included training and development. But at the time the committee thought we would balance it and allow the entities to put in some of those extra recommendations from submitters. But what I note is that the Minister looked to clarify some of the parts around the Public Service Act, so I ask the Minister if she can just take the committee through what she intends and what is the policy intent of a water services entity to be a good employer. Again, we were really fortunate to have a number of employment lawyers on the Finance and Expenditure Committee. We spent a lot of time on making sure that we covered most bases. There were some elements that didn’t make the revised tracked version of the bill, and I’d just like the Minister to come through about what her policy intent is around those clauses.

Hon NANAIA MAHUTA (Minister of Local Government): I welcome the member’s clarification of the discussion that took place at the select committee in relation to the joint contracting arrangements and the lessening of the period from 35 years to 15 years. Upon further investigation of the submissions, what I also noticed is that many submitters themselves felt that 35-year contracts were effectively a type of privatisation, and I don’t think they were casting aspersions on who the contract holder was. I just think they expressed a preference that if there could be local procurement, it would be a preference and it would be an advantage to New Zealand and it would have a local advantage. That’s the first thing.

Back to the question from Barbara Edmonds, and back to the point in relation to water service entities being a good employer. Well, part of the guidance, really, is around the formation of the policy, which is set out in clause 120(1), (2), and (3), but actually the guide is section 73 of the Public Service Act 2020, with the addition, as I pointed to in my opening statements, of paragraphs (i) and (j) in that particular clause. Overall, though, when we go through each consideration, line by line, of what it takes to be a good employer, what we said was that the schedules of the Act is the application of how that can happen. So, for example, in Schedule 1 we see how there is good employer protection of those currently in the workforce, and how they will transition through into the water service entities. And if we can give any clear direction and certainty about being a good employer, it is to stand up legislation that gives certainty to the employment of a chief executive and then the chief executive’s role is to make sure that the transitional arrangements can be given effect primarily with staff, but then going through to infrastructure and architecture. The member on the other side of the Chamber talked about IT and the IT platform, and a lot of work’s gone into that. And you know what? We’ve learnt a lot from other big transition programmes, like for example—

Hon Member: I hope so.

Hon NANAIA MAHUTA: —if the member wants to listen—the Auckland reorganisation. In a practical sense, that is a comparable type of transition where a number of councils were brought together to create the super-city, and in fact that was policy led by the then National Government. And there were a lot of learnings at that time about what you can do better and the mistakes not to repeat, and, effectively, the key areas to prioritise in a big transition programme such as that was. So we brought that learning forward. It is in the local government sector—we brought it forward but we’ve applied the very best elements of the learning in this particular context.

In terms of the questions around the employment of a chief executive, the approach taken in clause 119 aligns to sections 117 and 118 of the Crown Entities Act, and, as I say, we’ve tried to ensure that we’re not reinventing the wheel unnecessarily. We’ve taken the very best elements of what we know to work and adopted it within the context of the legislation. Why? Because we want this to succeed, notwithstanding the comments on that side of the Chamber. Why? Because we know that being responsible and finding a solution means we get to seriously contemplate every eventuality that could arise. Why? Because we know that at the end of the day, if we do this well, and we will, all of us will benefit because we’ll have a more sustainable way of financing water infrastructure, and we will give our communities, our kids, and our families the assurance of safe drinking water. It doesn’t matter whether they come from a big community or a small community—that assurance alone means that those people in Te Kao who’ve had boil-water notices don’t have to go down that track. There have been many other places around New Zealand who have been in that instance.

Coming back to Part 3, Madam Chair—and thank you for your indulgence—there are other elements that I think are worthy of comment to the extent that we want to ensure, again, on the point of privatisation, that that is prescient in the minds of people who believe that change is necessary and believe that we can have a public model of water service delivery. We know that in the UK, for example, that private model of water service delivery doesn’t deliver the best advantage to their communities.

MARK CAMERON (ACT): Thank you, Madam Chair. Minister, going back to Part 3—we’re in Part 3, obviously—clause 116 again, can I seek your clarification if you’d be so obliging. Clause 116(2): “In order to perform or exercise its duties, functions, or powers under this Act, a water services entity must not do any of the following: use water services assets infrastructure as security for that purpose”.

So obviously that’s balance sheet separation. And to your words earlier today, it gives council oversight over its asset and yet this entity decides how those assets are adjudicated and where the monies are spent and where contractors, services and/or procurement is directed to. How do you reconcile that?

Again, going back to the rural ends—and I’m sorry I’m going to bang on about the rural ends, but it’s dear to my heart as it is to many, many, many parts of the country. When there is no need for balance sheet separation because local authorities working hand in glove with local contractors have a continuing reality where asset management and health standards—i.e. we’re talking about Food Act health standards for freshwater consumption—are meeting the necessary standards. Do you want to clarify that? Because again, you’ve spoken about how councils will own their own assets and yet the water services entity decides how those assets are managed.

I’m trying to reconcile that, as are many rural New Zealanders, when we currently don’t have a lot of problems.

SIMON WATTS (National—North Shore): Thank you very much, Madam Chair. Just a short call from me on this one, as I think we’ve traversed quite a lot. I’d like to reflect back on the Hon Eugenie Sage’s Supplementary Order Paper that the Minister has noted they are going to support, and it’s quite interesting where, in effect, against the recommendations of the Attorney-General, we’re going to now imply this new trigger point, which is our “moral obligation”! Who cares what everyone else thinks; we’re just going to come up with a new position! No major party in this House has ever indicated an interest in privatisation. This is political spin by both the Greens and Labour to try and rark up a story that doesn’t exist. That is a real disappointment, but that is what is going on here—and against the advice of other players. They know it’s not a practical mechanism—that, even in an eventuality, which would never occur, this would be effective. It is cynical political spin.

The clause I want to talk about is in regards to clause 128(2)—a little addition that was made, and you have to go right to the end of the bill to find this—“The head office of a water services entity must be located within its service area.” Interesting. Interesting little clause, that one. I cast my mind back and I was remembering, in the select committee deliberations, as we were talking about a whole lot of issues of substance, this little one just slipped through the gaps. I’m wondering what was going on there. What was happening? What was the thinking? I’m looking at my colleague across the way there from the beautiful Hawke’s Bay. So my question, Minister, is as follows: I’m particularly interested around—and we go to Schedule 2; I know that’s part of a different part, but I’m using that for clarity and contrast just to ask this question—the Eastern-Central Water Services Entity, in Part 3. So we’ve got mighty councils in there like Hastings District Council and Napier City Council—I could go on and on, but I think we all know who they are. And then we’ve got other councils which are equally deserving: Wellington City Council and Porirua City Council, and Palmerston North City Council. The clause 128(2): “The head office of a water services entity must be located within its area.”

So my question, Minister, is quite simple: what advice, if any, have you had from your officials or officials in the Department of Internal Affairs around where they believe the head office should be located for Entity C? Is it the Hawke’s Bay or is it Wellington, or is it somewhere else? I’m interested to know if you’ve had any advice in regards to that. I mean, I would expect so, because we’re advertising for the CEO roles for these entities, which are noted in clauses as part of this part. So the conversation really has to be: so where are these head offices, and what constitutes a head office? Because we know—and my good colleague Andrew Bayly—what constitutes a head office in a tax sense, of course. Is it a centre of management, or is it where the majority of staff are, or is it where the decision-making is made?

The point I’m making here is that it’s pretty challenging to see how a head office could be located in any other location in Entity C that is not Wellington, because the reality is, with the co-location of Government services and entities and all of that, the decision making is happening in Wellington. So, on that basis, I’m interested in a little bit of context on that. And, while the Minister is on it, it would be good to get a little bit of advice around where the head office is going to be—where it’s going to be in the South Island, as well. And I’m appreciating, Madam Chair, I’m not sure about protocol—

Andrew Bayly: Madam Chair?

SIMON WATTS: I’m not sure about protocol in the House, but I’m still talking—

CHAIRPERSON (Barbara Kuriger): Mr Bayly, Mr Watts hasn’t finished yet.

SIMON WATTS: Yeah, thank you very much. Crikey! Sorry, Minister—oh, a new Minister—crikey. You close your eyes and you open them again and we’ve had a change! So let’s have a little bit of context around that point, and that’s all I’m going to say on that.

ANNA LORCK (Labour—Tukituki): Thank you, Madam Chair. Work—we’ve been talking a lot about work in the Chamber today, and the regional economic development and opportunity for regions. I can refer to the region of Hawke’s Bay, and water infrastructure—additional local employees to upgrade and deliver these services is estimated at an additional 246 to 367 full-time jobs; and the economic development, growth, and potential increase: $577.2 million to $866.7 million. Now, that is a huge economic benefit, and that is why it is so important in this legislation that we’re seeing about growth and opportunities for the region.

I turn now to the question around addressing where the location of a head office should be in an entity and why it is so important when delivering services—whether it’s Hawke’s Bay, whether it’s the Wairarapa, whether it’s Wellington or Nelson; where operational services, regional operational services on the ground are delivered to create economic development and opportunity, a pipeline of work for the future, growing greater skills and opportunity for the future.

I asked the Minister to respond on where the opportunity growth and things like the head office location of an entity are and why that is part of the legislation. Thank you.

Hon KIERAN McANULTY (Associate Minister of Local Government): Thank you, Madam Chair, and congratulations on your temporary elevation.

CHAIRPERSON (Barbara Kuriger): Thank you.

Hon KIERAN McANULTY: To address the points made by Mr Cameron of the ACT Party, it’s the second time you’ve asked that question. I heard the Minister address it the first time, but I’m quite happy to go over it again. Rural communities that currently have a relationship with their local councils face a choice. They can choose to go it alone or they can choose to go with the entity. If they choose to go with the entity, then the relationship they currently have with their councils will be replicated with the entity. They will continue to have a say, usually through a joint committee. They’ll continue to make joint decisions on the way in which water services are delivered in their area. But I would encourage those communities to think very hard about the prospect of going alone. If they were to go alone, then they are faced with the responsibility by themselves to meet the water standards and cover the costs of those maintenance and upgrades by themselves. And for many of them, that is a prospect that is beyond their ability.

In regards to Mr Watts’ comments, again, a bit of repetition there. In fact, I’ve actually already addressed the issue around head office when we discussed Part 1, I believe, but I’ll just repeat the answer that I gave. Ultimately, whilst the provisions do require a head office to be within the service entities, each area within that will also continue to have the services placed there where possible, and that actually touches on a lot of what Anna Lorck—

Andrew Bayly: How do you know that?

Hon KIERAN McANULTY: —touched on. The question is, how do we know that? Because that’s what’s required, Mr Bayly. Well, ultimately what I think we’re seeing here is an attempt by the Opposition to drag this out. They’re asking the same questions over and over. A bit of scaremongering from Mr Watts as to asking questions such as “What does a head office mean?” Well, that’s clearly described in various pieces of legislation; trying to trip us into saying “Have you seen advice as to where the head office will be located?”, where he knows full well that the entities themselves decide where the head office will be.

So I think that covers it—I think that covers it.

Hon EUGENIE SAGE (Green): Thank you very much, Madam Chair. I would just like to respond to a few comments that National members have made about the entrenchment provisions, because I think they are saying there is no need. But it was the National Government that, despite a major public campaign to keep our assets, passed the mixed ownership legislation that allowed for the privatisation of part of Meridian Energy, Mighty River Power, Genesis, and Air New Zealand. This was despite a massive public campaign in 2012 to gather signatures on the referendum to keep those energy companies and Air New Zealand in full public ownership.

So while members of this House may say there is no intention now to privatise any of the water services entities, they showed, back in 2012, that they would ignore more than 300,000 people who signed the referendum to keep our assets. And that’s why this entrenchment provision in this Supplementary Order Paper (SOP) is so important, because it highlights that it would require a 60 percent majority of the Parliament to change the fact that water services entities should maintain the provision of water services and maintain their assets. There may be no intention at the moment, but things change.

As the Minister noted, when the Electoral Act was first passed in 1993, provisions in that were entrenched. Even though Parliament can’t bind future parliaments, it is that moral power that an entrenchment provision has—that it’s a strong signal in this bill, that it represents the will of New Zealanders. There were a lot of submissions very concerned about privatisation, and, on this, in the Green Party and in the Labour Government—it’s through responding to those concerns that we ensure that water services assets and infrastructure and the operation of those services are maintained in public ownership.

The way the bill is structured, with local authorities having those shares in proportion to every 50,000 people, is signalling that they remain publicly owned, and this entrenchment provision further underlines that. That’s why it’s important. And if the National Party really had no intention of privatising in future, then it would support this SOP.

GLEN BENNETT (Labour—New Plymouth): I move, That the question be now put.

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

Ayes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Motion agreed to.

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

Ayes 76

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Part 3 agreed to.

Part 4 Financial and accountability matters

CHAIRPERSON (Barbara Kuriger): Now, members, we come to Part 4. Part 4 is the debate on clauses 128A to 168 and Schedule 3, “Financial and accountability matters”. The question is that Part 4 stand part.

SIMON WATTS (National—North Shore): Well, thank you very much, Madam Chair. It is a pleasure to continue on this debate, even though at times it feels like we are talking to ourselves and there isn’t much listening going on in terms of amendments. But irrespective of that—

Hon Gerry Brownlee: Public’s listening.

SIMON WATTS: That’s absolutely right, Hon Gerry Brownlee. The public are listening and the public have listened and are watching the way in which this Government continues to not listen to their feedback in regards to a reform process that is destined to fail.

Part 4 of this bill, comprising clauses 131 through to 168, lays out, as we’ve heard—well, we haven’t actually heard from the Minister of Local Government, which generally would occur, but I’ll do that overlay just so that people understand what’s in this aspect—the financial and accountability matters of this bill, and there continues to be a number of issues in regards to this. It also brings into scope Schedule 3, which is also part of Part 4.

The questions that I have in regards to this aspect are wide and ranging. But I’ll start off with some aspects that I have actually raised in the Chamber today to the Minister in regards to—and I’m referencing here, Madam Chair, for the wee checklist in front of you—clause 140. In particular, my points that I raise are in regards to—140 basically says who the parties are that are able to contribute into the preparation of the Te Mana o te Wai statement.

The challenge that I raised with the Minister, in the Chamber this afternoon, was in regards to comments that she actually made in the Chamber this morning, which was in regards to saying that the establishment of the principles of Te Mana o te Wai “include a number of stakeholder groups, including the rural communities, Federated Farmers, industry groups, horticulturalists”—and I acknowledge Hon David Bennett in the back row there; he will know a little bit about horticulture and may take a call, if that is deemed appropriate—“as well as iwi.”

The challenge, and the basis of my Supplementary Order Paper 299, is that the only group that I’ve just referred to that has the ability to submit a statement around Te Mana o te Wai to the Government’s three waters reforms and to the entities is iwi—the only group.

So why is that? Why is it that only iwi are allowed to contribute into that process? Well, I can tell you what: we don’t believe that the voices of iwi are the only voices that need to be around the table in regards to input in terms of the way in which water services are managed in this country.

And I don’t think that, on this side of the Chamber, we are alone in that fact—that iwi are the only stakeholders that are able to input into that conversation. There is a large number, as the Minister has articulated—Federated Farmers, rural communities, you can go on and on.

Why can these groups not play a role to be able to input into those statements? Those are binding statements as well. So these aren’t just any old statements; they are binding statements on these water service entities, fundamental to the fabric of the structure of this entity. But when the Minister gets up and says that, you know, we’re not necessarily painting the facts—this is a fact.

This legislation, this aspect of the bill, I believe, is divisive. It is divisive in terms of separating out one specific group over all others. Why is that right and why is that fair in a country that would believe that we are all one?

Those individuals or groups or entities should—my amendment to this clause is quite simple, it is that, alongside mana whenua, we’ve also inserted that “or natural persons”, which basically refers to the fact that, actually, no matter who you are or what your role is or what your ethnic background—doesn’t matter; you’re a New Zealander and you have the ability to input into these statements.

So I’m very interested for the Minister to articulate: why is that not fair and just? Why is that not reasonable? Why are iwi the only group that can submit into these statements which are binding on these entities? What is the rationale for that, and why is it just and fair?

Hon GERRY BROWNLEE (National): Madam Chair, thank you. Just following on from the comments made by Simon Watts and supporting the questions that he has raised, I think it’s worth looking at clauses 143 through to 145.

So, firstly, if you step back from that, there’s, under 142, the “Obligation to publish response to Te Mana o te Wai statement for water services”. Now, what that would tend to say is that it should be done as soon as practicable, and, in any event, within two years after receiving the statement which it relates to. Yet the statement that’s required from these new entities in 143 is an annual statement. So the question would be: how does that then become a document that the Auditor-General can sign off on, as is required under that same clause, to reflect the fact that they have taken into account Te Mana o te Wai anyway? So there is the issue, then, of why Te Mana o te Wai persons who have that iwi responsibility, or hapū responsibility, are able to make that—what would you say?—pleading to these particular bodies, and why is it, then, that the Auditor-General steps in over the top of things? I don’t understand that.

Further, it says that the purpose of the statement of intent is to set out the entities’ strategic intentions and provide a base against which the water services entity can have its actual performance assessed. Well, there’s no real statement beyond that as to who makes that assessment, other than, say—and we return again to the Auditor-General in this sort of circular way that has been constructed in this part of the bill—having a look to see if all of the inputs are properly reflected in the statement. And it says, in 144(3), the “statement of intent must—(a) relate to at least to the following 10 financial years; and (b) be prepared in accordance with Part 1 of Schedule 3.”

Well, that’s fairly procedural, no problem there. But what becomes interesting is that under 145, the statement of intent from the water authorities must—must—take into account “(c)(ii) the direction and priorities in the Government policy statement; and (d) how the statement relates to engagement requirements and will respond to or reflect the results of engagement; and (e) an explanation of how the proposals in the statement are linked to the matters raised in, and the findings from, consumer engagement stocktakes.”

Well, what do we take from that? We take, obviously, that they’re supposed to have some kind of comms unit inside each of these new entities that supposedly reaches out to various communities. But what we know for sure is that overarching all of the inputs that might be coming in—and there are actually not too many of them—is this Government policy statement.

So when we’ve had the Minister of Local Government repeatedly, through this committee process, protesting that this was, essentially, an arm’s length from Government, an arm’s length from local government, with entirely the purpose of protecting water assets, it is totally compromised—unless you’ve got some other answer, Associate Minister McAnulty—by this statement in here, because, ultimately, they can’t do anything that is not prescribed by the Minister. That is abundantly clear—couldn’t be clearer. That, of course, then, is the basis on which the Auditor-General will give effect to their report, saying simply whether the statement gives effect to its purpose—and its purpose, of course, can’t contravene the national policy statement. So stamped all over this is the will of the Minister—the whim of the Minister—and the policies of the Government of the day.

So I think some people are being led up the garden path about how much input they might be going to have here. We don’t agree with Te Mana o te Wai proposals; we think everyone who’s involved in the water situation should have a statement. But, here, it’s clear that even they are being shut out.

PENNY SIMMONDS (National—Invercargill): Thank you, Madam Chair. Look, I’m so delighted we’ve got to Part 4, “Financial and accountability matters”, because I think I’ve asked four or five questions, and each one of them has been asking about how the efficiencies and the effectiveness and the more sustainable cost of these developments are going to occur, and yet I haven’t had an answer to how that’s going to happen. And that is making me increasingly nervous.

I know I keep harking back to what we’ve seen in the amalgamation, the centralisation, of the polytech sector, but it is the only entity that this Government has done that to so far. So we look to the mistakes and the problems and the mess that is going on there. The same assurances were given: that this would be wonderful in terms of saving money, and more cost-effective and more efficient, when, in fact, it is costing hundreds of millions of dollars more. Now, that’s in a very small sector. This is a huge sector. So are we going to get into a situation where it is going to cost us billions of dollars more when this is amalgamated? Nothing has been given in an answer that shows how these efficiencies can occur.

In fact, there are a couple of things that have made me particularly nervous. A member on the opposite side of the Chamber said what a wonderful economic development opportunity—I’m almost starting to talk like her; that’s a worry!—it is going to be for the head offices of these entities. Well, how is it going to be a wonderful economic development initiative? The money is being spent, now, to look after these water services. So it can only be a wonderful economic development opportunity if more money is going to be spent.

Then, I talked about the regional council—people who are involved in water services—who have already been pinched by these entities, even though the bill hasn’t passed yet, and have been offered in the vicinity of $30,000 more to do the same job. Now, that keeps adding up, to me, like more money. So I’m really, really keen to see—to hear—how these efficiencies and how this more effective and better performance is going to come about, because I don’t see, when you keep spending more money, how that’s going to happen.

I’m really worried for our small councils. I keep talking, again, about Gore, but I’ve got to talk about the areas that I know. So Gore District Council, one of the smaller district councils, and it’s a given that they are unlikely to get a seat on the representation boards—so millions of dollars of their assets being run by an entity that they don’t have a seat on. How are they going to have any input into the preparation of the plans, of the pricing, of the reports, and how are they going to be protected from the cross-subsidisation? And, again, I go back to the polytech one, where we’ve seen what’s happened there, where all we’re seeing with the centralisation is the cross-subsidisation of those that have been prudent in the way they have run their polytechnics with those who have been much less prudent. So I would be sitting in Gore District Council, or any of those other smaller councils, and there is a dozen of them in our southern region, feeling very, very nervous about having my assets snatched away from me.

And let’s remember that those assets have been paid for by ratepayers over many, many years. We have got families that have celebrated being on their farms for 150 years. So they have paid hundreds of thousands of dollars’ worth of rates over those years to own these assets, which are now being stripped away from them, and they are going to have no say in how they are going to be run. So can the Associate Minister of Local Government, please, after about the fifth time of being asked, tell us how wonderfully efficient and more cost-effective these entities will be?

Hon KIERAN McANULTY (Associate Minister of Local Government): Thank you very much. By the member Penny Simmonds’ own admission, she has asked that question a number of times, and I myself have heard the Minister of Local Government respond quite clearly. Perhaps, if she wished to refer to a clause in this, I may be able to go into more detail. But, for those members that did specifically refer to Part 4 in this, I do have a response.

To Mr Watts’ question about Te Mana o te Wai, now, these statements are for a very specific purpose. These are to provide a mana whenua view on how water service entities should be implementing the responsibilities that they hold. Now, that is deliberately drafted to provide a very specific purpose. Now, the Crown does have Treaty obligations to meet, which is why strengthened oversight at the regional level is part of this reform. However, everyone has the opportunity to contribute into the operations of the entities—some examples, through asset management plans, infrastructure strategies, funding and pricing plans, and, of course, spatial and land-use planning purposes.

In regards to Mr Brownlee’s comments, there is one matter that I’m looking into further, Mr Brownlee, and I’ll get back to you. But, in response to the other part, these changes were made, actually, at the recommendation of the Auditor-General, and the statement of intent would explain how the entity has had regard to consumer engagement, not just how it proposes to approach future engagement.

MAUREEN PUGH (National): Thank you very much, Madam Chair. I would like to make a small contribution to this Part 4 of the Water Services Entities Bill because it is of great concern to rural communities, which we’re hearing a lot about from my colleagues. Sadly, we’re not hearing a lot about it from the Government.

One of the concerns that I have has been raised by my colleague Simon Watts, and that is around accountability, and I have concerns around the statements—the ability for these entities and mana whenua, the iwi and hapū of local areas, to be able to make these statements, which become binding. But, then, I wonder about the conflict that that may create with the Government’s own policy statements and the statement of intent, because there is no guidance on those statements that iwi and hapū can make. So what happens if there is a conflict between what those local statements say and the Government policy statements and the statement of intent of each of those entities, and are those entities all going to have the same statement of intent or is there going to be one that is common across all four of those entities?

I wonder if the Associate Minister of Local Government could respond to that, about how we then become accountable to the former owners of those assets in terms of how those statements might impact on them and other water bodies. We’ve heard that it’s now “five waters”, but I actually have to wonder whether it could become “six waters”.

I use my own example at home, because I have a naturally flowing creek that we source our drinking water and our stock water for the farm out of. Now, if there is a local statement made around those waterways, is there an imperative, then, on the users of those waterways to pay some kind of a fee to the water entity in that area—which would be the bulk of the South Island being covered by that one. So how can we have a guarantee that those existing use rights are going to be preserved? I know that the Minister has said many times about water assets and supplies and all of the associated infrastructure with three waters, but if we’re creeping into “five waters” and, I suggest, maybe even “six waters”, then how can we guarantee that the users of those assets which—and I call the water supply that I use a very valuable asset. How can you maintain control of that if the authority for it is given off to an entity?

The analogy clearly is that if your name is on the ownership papers of a vehicle and that vehicle is stolen, you still technically own it, but have you got any control over it? You might get it back in pieces or you might find it burnt out somewhere. That’s the fear that we have with the reputation of this Government: that these water assets across the country are seized and that the outcome is going to be typical of the outcome of every other centralisation project and experiment that this Government has undertaken, which is that locals lose control. Locals lose the services that they used to receive from those entities, like those in our tertiary education sector and like our health services, and then we are left with a burnt-out shell that a National Government is going to have to turn around and try and repair.

So if there are some guarantees that we can get from the Minister that we are not going to creep into “six waters” and that local supplies can be guaranteed existing use rights, that would be great if the Minister could respond.

Hon KIERAN McANULTY (Associate Minister of Local Government): I’m not even going to address the speculation and scaremongering around six, seven, eight, nine, 10 waters. This matter has been addressed in the committee a number of times, and it’s been very clear that it is three waters. They can scaremonger all they like. I think it’s an attempt to hide the fact that they still don’t have a single policy on this issue.

But on the matters that she has asked her question, I do have an answer here. Those documents that the member referred to serve different purposes. The Government policy statement will state the Government’s overall direction and priorities for water services, and Te Mana o te Wai statements will be a unique expression of kaitiakitanga from mana whenua in relation to specific water bodies.

SIMON O’CONNOR (National—Tāmaki): Thank you, Madam Chair. National has a very clear policy, responding to the Associate Minister of Local Government: we will repeal this legislation.

We are, of course, debating Part 4, “Financial and accountability matters”. So the question here is really for the Associate Minister, whether he understands the notion of what a treaty is, because in defending the right of mana whenua to have a direct, influential, and material say over and above everybody else—over and above everybody else—does the Minister in the chair, Hon Kieran McAnulty, understand that treaties are, by their own definition, about partnership, about equality, about relationships.

The very nature of a treaty is it’s not one-sided, Minister. Why is it only one group of people? That’s not a treaty-natured relationship. So it’s actually a very false argument, a very illogical and inconsistent argument, to say that Te Mana o te Wai, all this way through Part 4, are only the problems of one element of a treaty. That’s not a treaty; that’s a singularity. I would just really like the Minister to see if he could respond to that, or explain why, in a treaty relationship, one group of people have more say than the other.

The second part that I want to draw on very quickly is, if I might—and I raised it earlier to the Minister in Part 3—what are the qualities of mana whenua that other people in the world don’t have? What is this absolute unique view of water that mana whenua have? Because as I—

CHAIRPERSON (Barbara Kuriger): To the member, can we stick to Part 4, please.

SIMON O’CONNOR: Absolutely. It is all of Part 4, because all the reporting on financial matters—and thank you, Madam Chair—is prefixed on a point of difference. I’d just like to understand what that is, because when I think of water, and other people, we all do want it to be ecological, well-guarded for multiple generations, and so forth. So I’m just trying to understand: what is this unique point of difference that the Minister sees exists?

Hon KIERAN McANULTY (Associate Minister of Local Government): Thank you, Madam Chair. This won’t take long. I like to boil things down to its most simple element. When you have a treaty or a contract, you live up to what you promised, and we’re living up to what we promised in Te Tiriti o Waitangi.

Hon EUGENIE SAGE (Green): Thank you, Madam Chair. I would like to move to another matter in Part 4, and that’s around major transactions. The Green Party has sought to respond to public concerns expressed through submissions about ensuring that there is good scrutiny of any transactions by the water services entities, and that the entities that hold commitment to public service is really solid.

There was a recommendation through the Finance and Expenditure Committee to replicate in the bill some of the provisions that exist in companies law to ensure that there was scrutiny over any major transactions by the regional representative group. So new clause 164A provides that any major transactions—whether it’s the acquisition or an agreement to acquire more assets, or the disposition or agreement to dispose of assets of the entity, or a transaction that has the effect of the entity incurring obligations or liabilities, including contingent liabilities, which are more than half the value of the entity’s assets before the transaction—would have to go to the regional representative group, and there would have to be a special resolution requiring 75 percent support on the regional representative group for that transaction.

There’s a Supplementary Order Paper (SOP), 296, in my name, which seeks to reduce the definition of major transaction to any transaction involving more than 25 percent of the entity’s assets. Reducing that threshold would then trigger that 75 percent majority required to support that. The intention behind that is to ensure that the regional representative group, representing councils and iwi and the wider public, is really engaged in these major transactions. And, again, it signals the commitment, on this side of the Chamber, to the water services entities acting in the public interest.

I think it is irresponsible of some of the previous speakers to say they’re just going to repeal the bill when they haven’t put up a plan about how they would reform water services, how they would ensure that three waters were well provided. So it’s changes likes the major transactions one which we see as responding to the public recognition of the importance of a strong public service ethos to the delivery of water services and the concerns that the Public Service Association and others expressed in their submissions about progressive contracting out, which can lead to privatisation.

So this SOP 296 increases the scrutiny that the regional representative group would have and ensures that any of these major transactions have a 75 percent majority support in the regional representative group.

SIMON WATTS (National—North Shore): Thank you very much, Madam Chair. Look, it’s hard to go past the contribution from the last member, Eugenie Sage, when, in the prior part of the bill, a Supplementary Order Paper was put up to remove stormwater and it was declined by the Government and yet still voted for the bill. So where do we stand? Is it, you know, going from two waters to three waters—are we just going to fold on that? I think that’s part of the challenge we’ve got.

But I want to talk about clause 166, so a clause that we haven’t spoken about today. It is a clause that has been a big issue right from the start. I’ll set a little bit of the context, and then get into the questions. This is the concept that on this side of the Chamber we’ve referred to as token ownership. It is basically the basis of this bill, under clause 166(1)(a), that, in effect, territorial authorities or councils technically own the asset. I say “technically”, like they might own the house but they don’t have the keys to the front door and they don’t decide where the furniture goes in the house; it is token ownership. Clause 166(1)(a) says that these entities have, and I quote, “no right, title, or interest … in the assets, security, debts, or liabilities of a water services entity”.

One doesn’t have to be a forensic accountant or a specialist in any of that aspect to work out that when you use a word such as “ownership”, where you will have a shareholding in these entities—I think it would be common in plain language to expect that that would infer some rights over those assets or liabilities, quite simply. But this clause makes it absolutely categoric that that is not the case.

So my question to the Minister of Local Government is as follows: why is this aspect of the clause within the bill? Why have we got a clause such as this which, in effect, strips all of those rights and interests from debts and liabilities and assets from the territorial authorities—which, don’t forget, have funded those assets over decades and decades by ratepayers—and is, in effect, having them confiscated wholesale by central government into these mega-entities?

The central government are saying, “Well, on paper, yep, you’ve got ownership and rights and shareholdings.”, but this absolutely defeats that statement—and again, more political spin. This rules out that they are going to have any obligation in that. So you technically own the house, but you don’t have the key to the front door. I’m wanting to know why it is that the Government do not trust our territorial authorities to have that degree of ownership of their asset.

One of the fundamental Opposition points around this bill—and also solutions that are included with alternative models that have been tabled and peer reviewed, that the Government have failed to listen to—is that councils and territorial authorities and groupings around that want the ability to retain the assets in local ownership and are willing to work together with other like-minded councils and form council-controlled organisations—heck, some already do it. Watercare in Auckland is already a great example of a council-controlled organisation entity that is working. Could there be improvements around funding and financing? Yes. Do we need to put them into one of these mega-entities and put fifty-fifty co-governance and centralisation to make Watercare better? No; we just need to deal with the problem on the table, which is around how do we get more effective funding and financing. Well, here’s an idea: maybe we should just fix that. But no, the answer is, actually, “We’re going to try and centralise Auckland in with Northland, create a mega-entity, create 350 more bureaucrats in a swanky office in Freemans Bay, and that will be that. We know that’s going to work.”

So I’m interested in the comments around that clause, and, as the Minister will note, I have got a tabled amendment in regards to this clause and I would appreciate if the Minister could consider that, and, if not, which I expect will be the case, provide some pretty robust rationale around why the Minister deems that this is so essential in terms of the underpinning of this bill.

MATT DOOCEY (National—Waimakariri): Oh, a very good choice, thank you very much, Madam Chair. I must say, it’s been a long day in the Chamber and what helps pass time is the Greens’ contribution. I do enjoy them, at one stage, being part of the Government and then, when they decide not to be, they’re opposing the Government. I find that absolutely fantastic.

Hey, I want to drill down into 154(2A) now, looking at the planning infrastructure strategy. Look, it reads well, as bills do: (2A) “An infrastructure strategy must outline how the water services entity intends to manage its infrastructure assets, taking into account” what existing assets are going to be renewed or replaced, responding to growth or decline in demand for services, and allowing for planned increases or decreases. Well, imagine what that’s going to be like on a regional representative council.

Look, you can understand the board taking a very rational approach, but, of course, it’d be interesting to hear from the Minister of Local Government about the interface with the regional representative group, because, of course, they’re going to be very parochial. Well, they’re the ones who actually can get on that group as well, because, of course, many territorial authorities won’t actually be able to get on there, depending on their size.

I want to call this clause the “Nigel Farage clause” because I think we are believing that everyone’s going to get on to that representative group with the best intentions. But, as we know, when Nigel Farage tried to bring down the European Union, he did that by being democratically voted into it and brought it down, burning from inside.

So what’s going to happen on that, the regional council, where people are going to be very parochial? And, of course, decisions need to be made of—maybe in these super mega entities where an area down in, let’s say, a fantastic area like Gore is up in competition with Waimakariri. Of course, Gore and Waimakariri are very fast-growing areas, because why wouldn’t they be? A great place to live: the climate, the people and the culture, the outdoors, and the nightlife. That is going to draw demand.

So I’d be interested to hear from the Minister how some of those issues are going to be traversed, because, of course, the whole idea of being on a regional representative group is to represent your area, and, of course, you will be very parochial in your area. And I don’t think anyone’s going to take too kindly to being told that their area is in decline or, in fact, one area is going to get a planned increase over another. So I think it would be very good to hear from the Minister about the interface between the board and the group as well, and how issues like that will be mediated.

Hon NANAIA MAHUTA (Minister of Local Government): In no particular order—because the comments have been quite free ranging—but in an attempt to try and cover off many of the comments in relation to Part 4, I think there’s a few things that can be clarified within the context of the questions that have been asked. Firstly, in terms of financial separation, many members in the Chamber have pointed to clause 166. It’s going to be very important in terms of the role and function of the water services entities and their relationship to the regional representative group, and then the professional governance of the board, that there is separation, partly for the governance elements of what needs to be done in order to deliver a service but primarily so that that separation gives confidence to the credit-rating agency that you can finance the investment in infrastructure through the ability to raise debt. And that separation is not unusual to many members in this Chamber. Take, for example, the superannuation’s Guardian Trust, which is two arms’ lengths away from Government.

I do want to talk about the issue of the Government policy statement (GPS), because there was a perception that was raised in the Chamber that the strong arm of Government can actually tell the water services entities what to do. That is not the case. It’s set out in legislation in terms of how a Government policy statement is intended to operate and provide some direction—and this is strategic direction. This is not hands-on telling; this is the strategic direction. But if we go to clause 130(3) and look at what a GPS involves, it means that the Government could express areas of concern in public health. So take Waikouaiti, for example, and the lead that was found in the water. And the more that we test our waterways, it could become quite a public concern. And I think about members in the south, and nitrates in the water are a very big concern for many members of the south. So from a public health point of view, this may well capture the attention of the Government to say, “We need to do more about that. We need to have cognisance from a public health point of view of this aspect.”

Now, the fix might not solely be in the domain of the water services entity, but for the Government that is looking across the whole system of its ability to ensure that matters are addressed, that’s why a GPS, a Government policy statement, can be quite influential. The GPS can express an interest in terms of public health, the environment, planning processes, and growth, and when we think about housing and urban development, it is critical because what has frustrated the current housing crisis has not only been a former Government that didn’t invest in public housing but actually the planning process. And so we need to make sure that the water services entity aligns to the planning process and addresses areas of priority for a Government in areas such as this—also climate change mitigation and adaptation. And, again, I’ve spoken at length, on many contributions in this House on this bill, that this is a pressing issue for councils to address. And when we look at significant weather events, it is the lack of resilience of our water infrastructure network that sees, when flooding occurs, sewage seeping on to the streets, which is unacceptable, impacting on drinking water, which is unacceptable. And then we understand just how fragile our water network is.

Water security is another element that I think—at a strategic level for a Government—is only a responsible measure to take to address this issue. Now, we have the luxury in New Zealand to enjoy good rainfall, but that should not let us believe that we have an infinite resource in water. We should treat water as a precious resource. And so water security is a really important consideration.

Resilience to natural hazards—we’ve spoken at length about that. And, also, again, this protects the public interest. This protects “New Zealand Inc.” interests. We have included a new provision, and I’ve accepted the views of the Finance and Expenditure Committee in new subclause (3)(a)(vii) that “local procurement, employment, joint arrangements, and joint water services entity arrangements:” preserve the opportunity for the local community to participate in the delivery of water services. Why? Because it matters. Why? Because we know that when we invest in our own people and our own businesses, everybody benefits—everybody benefits.

I want to come to another issue that was raised in the Chamber, and it was one raised by Mr O’Connor in relation to Te Mana o te Wai statements, and he posed the question that Te Mana o te Wai statements aren’t that unique. I guess, in many ways, if you take it from your perspective, Mr O’Connor, they are probably an inclusive way of looking at environmental priorities. And I have said previously in the House that Te Mana o te Wai aspirations are not binary; they are not exclusive. It’s an opportunity to find a way to integrate a whole world view about how we think about water—not one, two, three, four, five, six, but water as a whole system and how we look after it. Our kids want us to have that perspective going forward, and, for far too long, that has not been the case. Case in point: every time the issues relating to this reform programme are referred to, it’s three waters, as if there’s no interconnectedness with other elements of how we look after water—for example, discharging water to rivers, lakes, oceans, and our beaches.

So the point of that is that the unique perspective that iwi mana whenua and Māori bring to the Te Mana o te Wai statements is that, in its application, what this proposes is a catchment-by-catchment approach to thinking about how we find solutions to some of the challenges—not just about water service delivery providing safe drinking water but when we discharge water to the environment, let’s make better use of local knowledge in relation to, perhaps, wetlands. And a lot of that knowledge is very local, and some of the traditional knowledge—you go to Thames and you see where they’ve consented for some housing, and lots of locals will say, “Why did they put housing there? Because that was a natural flood plain.” And the member knows it. So, I think, when we draw on the best of what we have to offer our communities—the opportunity to make good, sound, resilient decision-making for the future in this space—then we could not ignore the fact that having Te Mana o te Wai statements as complementary additions to the decision-making process is a total positive benefit.

I want to come now to clause 140, and it was commented on briefly in this Chamber. The reason that I would like to clarify why that is an addition to the legislation is that as we engaged with several mana whenua interests—and you will recall a primary consideration is upholding existing Treaty settlement obligations. Clause 140(1)(a) and (b) enable, where there is a case that iwi mana whenua interests straddle a particular boundary, that there is an opportunity for those interests to be reflected and taken account of, most certainly if they are clearly expressed within a Treaty settlement. And that clause enables, for example, at a practical level, a service-level agreement across an entity boundary to exist, partly to uphold the mana of a Treaty settlement but partly to ensure that, where it makes sense, the aspirations for a catchment that may be divided by a boundary—you can still achieve the beneficial outcome in terms of decisions around that catchment and ongoing water-service delivery. I felt that it was important to clarify that particular clause.

Lastly, coming to the matter raised by the member for the Greens, Eugenie Sage, on her Supplementary Order Paper (SOP) 296. The argument that she sets out in terms of being able to lower the threshold for a major transaction to enable greater scrutiny of the regional representative group at a level—at a level—that makes sense, but not set at a level—so I know that the member mentioned 10 percent—that could be a threshold that would actually, to some extent, push the role of the regional representative group into more of an operational set of considerations. Well, 25 percent in our determinations—and I took advice around this—is a threshold that I still believe enables the intent of what the member wants to achieve, which is to make it a very real, tangible consideration that goes to the regional representative group and, then, the decision-making process around divestment of assets, for example. So it’s our determination that we should support that SOP, and I thank the member for putting it up.

PENNY SIMMONDS (National—Invercargill): Thank you, Madam Chair. I want to return to clause 166 in this Part 4 of the Water Services Entities Bill, because, you know—I guess I think of myself as a practical, pragmatic person. I know that this has been a source of concern for a number of people. So I’d like the Minister of Local Government to give us a very clear answer on how this clause makes any sense.

If we can just go through it, clause 166(1): “A territorial authority owner”—and we’ll go straight to (a)—“has no right, title, or interest (legal or equitable) in the assets, security, debts, or liabilities of a water services entity”.

I have to relate it back to things that I know. I own a house, but I’ve got no right to it, I’ve got no title to it, I’ve got no interest in the assets, I’ve got no security, no debts—how do I own it? That’s the simple question that people keep asking me, so here I am again. Gore District Council; it’s not in my electorate, but it’s a neighbouring electorate, and I went to school there so it’s dear to my heart. Gore District Council: a small district council, people have paid rates for years to pay for the services that they’ve got over decades—and those assets can be taken off them without any recompense. So they’re taken off them, but somehow the Gore District Council is still the owner of them, but can’t—probably won’t—have anyone on the representative body to have any say in what happens with them, but they own them.

Look, I just can’t understand how you own something but you don’t have any rights. I’d really, really like the Minister to answer clearly on the opposite of it, of the positive of, “Yes, local authorities, you own it, and this is what you have for being the owner. This is what you are entitled to. This is what being an owner means.”, because it feels like—and I know this was a change in the legislation early on when people got very upset about losing the ownership. There’ll be a few old enough in the Chamber to know what I’m talking about, it feels like a Clayton’s ownership—the ownership you have when you haven’t got the ownership. So what actually does ownership, when you have no rights, title, interest, security, debts—what, on the flipside, is the positive of being the owner in this instance?

I know that there are an awful lot of members of the public, who may be listening to this, that have engaged in dialogue with all of us, as electorate MPs, about how this can be. How can you have an asset, it gets taken from you, you’re still the owner of it, but you’ve got no rights and don’t appear to have any control over it? That, I believe, has made people very, very suspicious and very cynical and very concerned about this piece of legislation.

I guess it then makes people think, “Well, what else in this is bizarre and how could it possibly work if we can’t understand how this very simple notion of owning something but having no rights and no ability to have any say over it?” So, please, Minister, just give us the positive side of what it actually gives the owner. Thank you, Madam Chair.

Hon NANAIA MAHUTA (Minister of Local Government): I thank the member for the question and will try and simplify my answer to the degree that I’m mindful that people are listening to the debate and they’ll be probably asking a similar question.

In its simple form, this is the point at which we: (1) enable the ability to transfer assets, debt, and liability of the 67 councils to the four water service entities to be able to aggregate up those interests, and leverage from that for the benefit of a bigger region. That’s one part of it.

But in terms of having an ownership interest that does not derive a dividend, there’s a couple of things about that. It will mean that we separate balance sheets so that territorial authorities, from transferring their assets, debts, and liabilities to the water service entities—in many ways, that will free up headroom. Many councils have reached the debt-ceiling limits, and that’s a constraint. That’s why there’s been a continual compromise over decades around what they fund and how they fund according to the aspirations of their local community.

You can have an ownership interest and exercise that through the way that we’re proposing in the bill, in terms of ensuring, through the regional representative group, the way in which you develop the statement of intent, the asset management plans, the funding and pricing plans, and the integrated management plans—those are all areas where you exercise your interest to be able to guide the water service entity. That’s as simple as I can put it.

Hon DAVID BENNETT (National): Thank you, Madam Chair. I’m interested in the Minister of Local Government’s last answer there, and the starting answer to clause 166 previously, where she said that governance was the reason why 166 was there. So that was her initial reason for it; and then when my colleague Penny Simmonds asked the question for clarification, the Minister said that that enables, basically, councils to have the ability to increase their rating capacity in other areas and to get more income flows, because they’re basically capitalised out—neither of them make any sense. Basically, this is an asset that councils have, and councils can borrow against that asset. Councils are like Government, which has a fairly unlimited borrowing, to a certain extent, because they can rate, or they can tax, like a Government can. They’re not like a normal business that actually has to make a profit; they’ve always got that rating capacity, and that’s why they actually can borrow more than a normal business would for its balance sheet. The idea of governance being the reason behind this doesn’t make any sense. The idea that we need to amalgamate all these things so that councils can free up their ability to raise capital or income in other ways doesn’t make any sense either.

The real crux of this bill is this clause 166(1), and when it’s called “Financial independence”, it’s not about financial independence, it’s about taking an asset, that’s what it is. The points, (a), (b), (c), (d), and (e)—none of that relates to financial independence. (a), (b), (c), (d), and (e): (a), basically, you’ve got no rights; (b), you can’t receive any dividends; (c), you can’t get any financial support; (d), you can’t lend on it; and (e), you can’t indemnify or use it as security. What is the point?

So if you actually were honest with the New Zealand public, it wouldn’t be called financial independence, this would be the “asset grab” clause, and that’s what it is. And there’s no way you can hide it behind “Oh, we need it for governance purposes”—that’s rubbish. Absolute rubbish. The thing is, the entities could still govern their own assets and be part of a conglomerate if they wanted to; it’s commonplace in most businesses when you have subsidiary companies—and it works. There’s no need to take the assets away and to have some kind of line there that doesn’t actually exist on paper.

Then, the second reason we were given by the Minister was so that it frees up the councils to be able to have more ability to raise money through rates. Well, what are they going to rate for? They’re not providing the assets; they’re not providing the services. They’re going to rate for playgrounds and pools and all those sorts of things, which is just going to hurt New Zealanders.

Minister, please answer the question that my colleagues have both asked around clause 166: what does it actually stand there and mean? Because, to me, if I read this, it’s not financial independence; it is taking an asset off an entity. Now, the Minister talked about the super fund and said “that’s an example, if that applies”. The super fund was not a case where billions of dollars of assets were built up by companies or entities and then taken away from them and then put into a Government organisation; people paid into the super fund over years knowing what they were getting. The financial separation there is completely different from taking assets away from entities that have built them up. So when the Minister talks about the super fund, it doesn’t make any sense.

Now, we have got probably the best Minister in the Government in the Chamber, here, today, and I’ve got a lot of respect for this Minister—she’s a brilliant person in the Waikato—

Hon Member: That’s nice.

Hon DAVID BENNETT: And she is. And she’s done great things for Tainui and the community. But I just don’t get it on this clause—maybe if the Minister could explain what financial independence actually means when you take away every resemblance of having any link to an asset. It can’t be for governance, it can’t be because it’s an analogy to the super fund, and it can’t be because you want them to raise more money into rate. There’s got to be another reason, and I would love to hear it.

Hon GERRY BROWNLEE (National): It’s in a way disappointing to take the call, because it would be really good if the Minister of Local Government could stand up and answer the questions raised by my colleague the Hon David Bennett. This is an extraordinary title to have on a clause: “Financial independence”. It kind of makes you think that what’s being said here is that councils are being released from something and that they’re being given something or that they’re going to gain something. But it’s all a one-way ticket. The most extraordinary thing is that there’s even a special mention in this clause 166, under subclause (3), of what equity return means: “profits of the entity;”, “distributions from the entity;”, or “any benefit derived, directly or indirectly, from a water services entity that represents, is calculated by reference to, or is determined by,—(i) a share in or proportion of … (ii) the entity’s surplus or residual”—blah, blah, blah; on it goes. Anything—they can’t get it. So the owners of the asset are completely shut out of any benefit financially from that.

Worse than that, where there is the case of councils who have looked after their assets, who have kept them up to date, and, in the case of Christchurch city, spent an enormous amount of money bringing them up to what would effectively be a 65-year standard, they’re just taken—walk away. And, apparently, then, no concern about some of the specifics that have been mentioned by Eugenie Sage today, and they concern me as well—flooding in the southern parts of the city, southern and eastern parts of the city. No direct control over any of that discussion. And it makes it abundantly clear, here, that they can’t even raise funds on behalf of this organisation to do some of these works. So the idea that somehow this is financially freeing is a nonsense, because there is no financial connection in the first place.

The other thing I think is really quite, I think, deceptive in all of this is that the Minister and other Ministers from the Government have gone around saying “No, it’s not a confiscation. No, we’re not taking the assets. The ownership remains with the local authorities.” Well, look, if you own a pair of trousers but you can’t wear them because someone else has got them, you may as well not own them. And that’s exactly what the situation is here—exactly what the situation is here. It’s like a farmer going out in the morning to put on the gumboots to find that, no, someone else has grabbed them. He owns them, but he’s in his stockinged feet in the mud for the rest of the day. Well, that’s the sort of ludicrous situation we’ve got. You know, Mr Doocey owns a flash car. It’s an amazing thing, it’s got his photo on the side of it. But he gets out there in the morning and finds that someone else has taken it. Yeah, someone else has taken it, because while he owns it, it’s not his. And he goes through all these examples. It’s just utterly ridiculous to have this here.

So the questions raised by my colleague the Hon David Bennett are reasonable ones and they should be answered, because if this is so good, if this is the sliced bread answer to three, five, six, or 10 waters—whatever it might be—then there’s got to be a greater benefit than “Trust us. We’re from the Government.”, which is, essentially, what this bill is saying to all of those who are on the end of any particular water reticulation.

The bit that is also just a little bit unanswered—and I asked this question earlier in the day—is, where we’re talking about a territorial authority or an entity or another such representative group that has the interest in water, where does it leave irrigation schemes? Because they all take water that run across the green fields, as it’s called. So the question is: do they still own their assets? What’s the value of their water takes? Are they now subject entirely to the whim of whoever might find themselves firstly on the representative group, which they are not part of and not prescribed to be, or the local authority, or local authorities multiple, that their scheme may run over.

So this clause 166 needs a response from the Minister. We don’t think it’ll be a good one but it should be, at least, given in the Hansard.

ANDREW BAYLY (National—Port Waikato): Thank you, Madam Chair. I know we’ve spoken on this clause for a long time, but, first of all, I want to respond to what the Minister of Local Government said before, and that is that, in the context of balance sheet separation, she implied that taking the assets and liabilities out was actually going to help the councils.

My first question to the Minister is: which councils will end up with a stronger balance sheet if they remove their assets and liabilities that relate to their waste-water services? A classic is Auckland Council. The asset value of the water assets in Watercare Services is about $12 billion, and I think the debt’s about $7 billion or $8 billion, by memory. So their balance sheet will have a hole in it to the tune of roughly $4 billion. Are there any councils that will have their liabilities exceed the value of their assets? If the Minister can’t answer that question or can’t give us an assurance to that, I would suggest to the Minister, gently, that every council will have a hole in its balance sheet. That’s my first question.

Secondly, I want to come back—and I know that the Hon David Bennett is an excellent accountant. He worked at KPMG, in Hamilton, I think. Anyway, this issue around equity was one that we canvassed at the Finance and Expenditure Committee, and I have to say I’ve never yet had an adequate response from the officials during the select committee stage. This comes back to what a share is. A common definition of a share is one of equal parts into which a company’s capital is divided, entitling the holder to a proportion of the profits. Now, in all definitions of equity capital, which is what we’re talking about here, there are normally rights, first of all, to receive dividends, because that is the return you get on a share. What we find in clause 166(1)(b) is specifically that a territorial authority must not receive any equity return, directly or indirectly, from a water services company. That strikes at the first and main principle of what an equity share is.

The second thing about an equity share is that you are able to participate in capital raising. If the company or entity wants to raise more capital, as an equity shareholder, it is by law a requirement, and, if you go to the Takeovers Code or the New Zealand Stock Exchange code, she—and I’m looking at the Minister—will be locked up in jail if she was to suggest that existing shareholders could not participate equally in any capital raising of a share by a company. Yet what do we find in clause 166? In clause 166(1)(c), the territorial authority owner “must not give a water services entity any financial support or”—wait for it—“capital;”. So now you’ve struck—and I’m saying this to the Minister—this piece of legislation which takes away the two fundamental rights of being a shareholder in whatever business or whatever it is, and we’re talking about water services here.

So the first thing I would say to the Minister is my reading of this—and I raised this at the select committee and I wasn’t able to get a proper answer from the officials—is that there is no way that the councils will be able to deem this as a share. In my view, there is no way they could place a value on these shares because they’re not entitled to any return and not, in fact, specifically in the bill, precluded from acting and participating as an equity shareholder. I would suggest to you—Madam Chair, I would like to carry on if I may—[Time expired]

Hon NANAIA MAHUTA (Minister of Local Government): Thank you, Madam Chair. I think the member very well made his case quite clear on a number of fronts—and clear to the extent that he is correct; the bill does not enable shares to deliver a dividend to shareholders. The reason for that is to provide safeguards around the model that we have, which is a public model of water service delivery, and an interest that preserves—going forward into the future—the nature of interests in relation to public assets and how they can be leveraged and used for a broader benefit.

But let’s just take that member’s point and take it to a natural extension, because, if dividends were ascribed to a shareholding interest, it defeats the purpose of the bill. And what we may end up finding is that, again, if dividends were ascribed to a shareholding interest, we wouldn’t be doing what we said we need to do, which is invest in infrastructure which has been underinvested in for some time. So that’s one element of it.

Let me come to Watercare. The member asked the question that, if this is going to work, Watercare is a really good example to show how it could work. What we know right now is that Watercare is constrained by Auckland Council’s debt limits.

Andrew Bayly: Different points.

Hon NANAIA MAHUTA: No, no, it’s not. In fact, fundamental to clause 166 is to get balance sheet separation to enable water services entities to be able to debt finance into infrastructure, which are long-life assets, and to leverage from the aggregated assets, debt, and liabilities under their purview, and then enable councils to have a shareholding interest and direct the way in which those water services entities operate.

But let me come back to Watercare because, right now, Auckland Council’s long-term plan has the average water bill increasing 7 percent in each of the next two years, followed by 9.5 percent per year for the following six years, and that’s by the disclosure of Watercare’s own numbers. Over 10 years, this would see bills for Aucklanders increase from $1,069 to $2,261. Now, even in a city like Auckland, where aggregation has taken place, where they have seen the advantages of services through Watercare, further efficiencies can be gained through this reform model. A study was done, and it demonstrated that this was the case.

So, despite being our largest city and benefiting from the earlier decisions to amalgamate, what we know is that Auckland has significant challenges still outstanding. So recent work with Watercare showed that there is still scope for further efficiencies, with the potential of 55 percent efficiency gains over the next 10 years. But, in the event that we continue with this reform programme and create Entity A, I am informed that the additional borrowing capacity of Entity A, compared to the collective council borrowing capacity under the status quo, will unlock an additional $1.2 billion for the council to invest in communities across Entity A—and that’s got to be good. Why? Because Watercare, now, in the current situation, has deferred renewals and maintenance initiatives across Auckland for about two to three years because they cannot fund that—and that’s not including growth assets.

If we know anything—if we’ve been observing what’s happened in Auckland over the last at least two or three years—the Government has to step in to support critical investment, to support infrastructure such as the provision of housing. Now, if we want a future that takes the challenge off council balance sheets, puts the responsibility into these water services entities by doing so, and ensures that, also, the Government is released of some of that burden which it is currently picking up—because taxpayers and ratepayers are the same people—then the water reforms that we’re proposing provide a solution to those challenges.

ANDREW BAYLY (National—Port Waikato): Yeah, thank you, Madam Chair. I appreciate that. Look, I just want to respond to the Minister of Local Government. This issue around dividends—I am not debating whether, in fact, the water services company should be paying a dividend. That’s not the debate. The Minister wanted to introduce that as the reason that it was precluded under clause 166. That’s not my issue. My issue is: if you take a technical definition of what “a share” means—and I’m talking about the 67 councils—then, by definition, if they aren’t entitled to a dividend—and, clearly, the bill doesn’t provide for it—if you’re not entitled to participate in capital, then you do not have a share. You cannot have legal ownership. I would suggest to the Minister that for all 67 councils, they will not place any value, and could not place any value, in their balance sheet for what their interests may mean for the water companies.

I’d put it to the Minister—and I’d ask the officials, as well, whether they’ve ever gone and actually sought a proper legal definition and whether, in fact, my assertion is correct that, for all these councils—67—because they cannot meet the definition of owning a share, they will note this as a thing in their notes for the account, but they will not ascribe any value to it, because they cannot, because it will not meet the definition of “a share”. I would imagine the Auditor-General, who is also required to do this, will come to a view that they cannot place a value on these shares. That’s the first point.

The second point, going back to Watercare—again, the Minister talks about future liabilities: what will happen on the day that the assets and liabilities are transferred? Twelve billion dollars of assets will come into the water services northern region, and there will be, presumably, if they can get agreement, about $7 billion or $8 billion of debt that comes across. That will mean, fine, in the water services company, they will have $4 billion of equity. But what will that mean—what will that mean—in the councils’ books? If you’re going to put a $4 billion increase in a water services company, you’ve got to do the reverse. That will mean the council’s balance sheet will be $4 billion worse off immediately following the transfer of those assets and liabilities.

For the Minister to stand there and say that the council will be better-off is an absurd assertion, because, right now, Watercare manages its business in a way that it takes all the rates it receives from its water activities and applies them to running Watercare and also to the investment in infrastructure. That would be the same for all councils across New Zealand. So those councils will have a hole in their balance sheets—in the case of Auckland Council, $4 billion; Tauranga tell us that their water assets are worth about a billion dollars and there will be some debt, they’ll probably have a hole in their balance sheet by about $400 million to $500 million. These are big chunks of money. To say that the councils will be better-off because they’re not incurring future liabilities is a spurious argument. They will simply have this gaping wound in their balance sheet on the day that it is transferred.

I don’t think any official or the Minister has ever fronted up with a proper financial conversation. Rather than talk about the philosophical stuff, what does it mean when you come to do the hard numbers in the profit and loss statement in a balance sheet? I don’t think any one of the officials or the Minister actually understands this issue. I think it’s a huge sleeping issue and we’re going to hear more about it from the Auditor-General.

I want to go back to clause 151—this context of the funding and pricing plan. I’m very keen to understand a little bit more about this because this funding and pricing plan presumably will be put in place by the new CEO, subject to oversight by the department, and then will go through the process of being approved by the establishment board and then going into the next stage.

My question is: what are the parameters? Councils rate differently—some do it on toilet bowl, they used to do it in North Shore; some do it on value of the property. What is the basis to make sure that everyone gets a fair pricing? Is there going to be differential pricing? How do we know that it’s going to be fair across everyone?

CHAIRPERSON (Hon Jacqui Dean): I call Tangi Utikere.

Hon David Bennett: Point of order. Point of order. Point of order.

CHAIRPERSON (Hon Jacqui Dean): No. I will deal with this matter first because I have called the member.

TANGI UTIKERE (Junior Whip—Labour): I move, That the question be now put.

Hon DAVID BENNETT (National): Point of order, Madam Chair. Thank you, Madam Chair. I would just like to raise a point of order around the Minister of Local Government. Before, we asked some very genuine questions in my speech—three genuine questions. The Minister actually wrote them down, but never replied to them, and—

CHAIRPERSON (Hon Jacqui Dean): Order! Order! Order! Order! That is not a point of order.

Hon NANAIA MAHUTA (Minister of Local Government): Point of order, Madam Chair. Flattery is not a prerequisite to answer a question.

CHAIRPERSON (Hon Jacqui Dean): OK.

Hon DAVID BENNETT (National): Thank you, Madam Chair. I am very disappointed the Minister of Local Government didn’t answer those questions when she had that opportunity. She did give an answer to Andrew Bayly—again, Andrew Bayly has recognised a massive problem in her answer.

But there is another problem in her answer. She says that Watercare is going to be $1.2 billion in deficit—it can’t do what it’s supposed to have done. Well, this new entity suddenly has the ability to borrow more than Watercare and all those other councils. That $1.2 billion that Watercare was going to have spent has come out of other entities that have put in assets that are higher than their expenses. So, basically, you’re transferring from some other council the ability to fund councils that haven’t been able to pay for their thing. This is not some magical thing that you put them all together and suddenly we’ve got a bigger pot of money that we can all do more with; it doesn’t work that way in life. If you put a bad business with a good business, the good business is subsidising the bad business, and that is exactly what is going to happen here. To say that Watercare will get $1.2 billion, that’s because Whangārei and some of the other regions that are part of that Auckland region are actually going to be subsidising that. As Gerry Brownlee said, Christchurch has had an exemplary water system and now will be subsidising others—that’s the ultimate effect. It’s not as if there is a very small debt-loading in councils around water. It’s huge, and it’s not going to change when you put them together.

Now, this clause is the heart of the bill. It, effectively, takes away ownership from the councils. Now, every member in this Chamber will think, “What actually happened in this House 140 years ago? How did we actually take assets off people, in this House, and get away with it? How did that actually happen?” You know, you can’t actually fathom how people did that 140 years ago. With the greatest respect to Nanaia and Willie and that, you’ve got a much bigger experience in this than me. But I just can’t understand how that actually got through Parliament of the day, how this building would allow assets to be taken off people that shouldn’t have been taken off them. This is what we are doing here today. We are taking assets off a community. It is taking assets off councils—that is what it is doing. Effectively, you have no ownership. This is what is happening here today, and that’s why councils are aggrieved.

I say to the Labour members, actually, we don’t have to do another wrong in this Chamber. We’ve done it once before and it’s been a tremendous wrong for this country. This is another wrong being made here today in the way that we’re doing this. We’re taking an asset off a community. And fullest respect to the Minister—I wish she had answered those questions. It doesn’t make sense, her explanation, and I think this is a very dangerous and sad day when we pass a clause like clause 166 in this Chamber.

CHAIRPERSON (Hon Jacqui Dean): Members, the time has come for me to leave the chair for the dinner break. The committee will resume at 7 p.m.

Sitting suspended from 5.57 p.m. to 7 p.m.

CHAIRPERSON (Greg O’Connor): Members, the committee is resumed on the Water Services Entities Bill. When we suspended for the dinner break, we were considering Part 4. Once again, the question is that Part 4 stand part.

SIMON WATTS (National—North Shore): Thank you very much, Mr Chair. It’s great to be back after the dinner break. I hope everyone’s refreshed and ready to keep rocking in the conversation on Part 4. I want to go to a couple of aspects and clauses that we haven’t covered in the conversation with the Minister of Local Government before the dinner break, and these relate to clauses 150, 151, and 152 in regards to funding and pricing plans.

Before the break, we were having some dialogue in regards to shareholding and other aspects. The questions I have on these clauses specifically relate to the concept around how we’re going to ensure that we’ve got mechanisms to ensure that the pricing across the four water service entities is appropriate, and the degree of confidence we have that those aspects are going to be in play.

So the specific question I’ve got for the Minister in regards to clause 151 is this: what are the safeguards that are in place, within this bill, that the Minister believes are going to be appropriate in order to provide a safeguard, particularly to smaller rural provincial communities across this country in regards to pricing increases they may see as a result of these entities?

The second question in regards to that, outside of small communities, is about the mechanism in which this information will be publicly published and disclosed in order to, I guess, provide a degree of transparency for communities around both the funding element, which is probably less relevant to the average household, and the actual pricing component. What is the mechanism around the publication of that data, and is the Minister confident that the provisions in the bill, in clauses 151 and 152, will provide that degree of confidence? So my question is around safeguards for smaller communities, and then the mechanism for publication, pricing, and funding mechanisms.

The second aspect I want to get into is Subpart 4 of Part 4, around reporting and particularly around annual reports. For those that are sitting at home watching the news—and they’re probably just about to move on to Parliament TV, because that’s what every household across the country, no doubt, will be doing at this point—you know I want to spice up the evening a little bit, so let’s listen to a little bit of the Water Services Entities Bill, committee stage. And I tell you what, I’m sure the Minister will join with me in saying there’s no better place to be than here at the moment.

My point is this: there’s been a lot of conversation through the initial phases of the select committee process around the Auditor-General’s comments in regards to this legislation, and this specific part is where this is very much relevant. You may recall that the Auditor-General raised significant, serious concerns about the transparency in the reporting requirements around the initial elements of this bill. Is the Minister confident that these issues have been solved, and has the Office of Auditor-General provided any feedback to the Minister in that regard? That is a question we discussed at the Finance and Expenditure Committee—has there been, in effect, confirmation back from the Office of the Auditor-General that the changes reflected in the bill, post the initial raising of the issues with it, have mitigated the issues and risks and concerns that the Office of the Auditor-General has raised? And, actually, the request at that point was to get some confirmation in writing back to the select committee. But the view from officials to us was that, actually, no, there’s been some dialogue and conversation around the fact that these changes to clauses 156 through to 164—particularly clause 161 around audit reporting requirements—will suffice. So I’m just looking for some confirmation and consideration from the Minister around the confidence that the issues around serious concerns around transparency and reporting have been addressed as a result of that.

The second aspect in regards to the reporting components in Part 4, Subpart 4, relate to the points around—it goes back to that representation conversation around the regional representative groups that we talked about in prior parts. But the reality is that there are going to be a number of smaller councils across the country that won’t have a seat as part of that governance structure. So the point that I’m wanting to link this back to is that in this subpart it talks about the preparation of plans and reports. And if you look at Schedule 3, I think, it refers to the preparation of plans and reports. How can smaller councils be assured that even though they might not have a seat in terms of their representation on those governance groups, particularly in rural and provincial New Zealand, they will actually be able to input into the preparation of those plans and reports that are outlined in the schedule I’ve referred to? I will leave it at that and welcome some response from the Minister.

Hon NANAIA MAHUTA (Minister of Local Government): Just in relation to the new questions that have been asked and the preparation of the funding and pricing plan, you’ll find that in Schedule 3—in clauses 13 and 14 of Part 3 of that schedule—it sets out, effectively, what is in a draft funding and pricing plan and who should be consulted. But, in the interests of brevity, territorial authority owners will be consulted and consumers and communities under the engagement provisions in section 202 of the Act. That will ensure, as the member has highlighted, that notwithstanding the size of the community—big or small—they will be engaged with, as well as the range of consumers that exist within the community.

On the matter of the Auditor-General, my understanding is that the Governance and Administration Committee adopted the recommendations of the Auditor-General, which was to ensure that there was greater public accountability in the bill. The changes included additional content in relation to planning documents, changing the time frame of the statement of intent, improving the scrutiny of all accountability documents produced by the water service entities, and additional requirements for considering consumer and community feedback. Then, the select committee went a step further, I understand, which led it to see if the changes adopted at the second reading were acceptable, and they were. So I think that, overall, that’s a positive indication of the way in which the select committee process, the public process, can help to improve the transparency and accountability and workability of complex legislation such as this.

Let me come back to the issue of funding and pricing plans. Effectively, what this bill does is establish the architecture for funding and pricing plans to exist, because we do need them, as we need asset management plans and as we need infrastructure strategies, which are long-term planning documents that are able to be reviewed periodically in sequence over a particular time frame.

But the most important thing in terms of driving issues such as equity, let’s say—the ability to ensure that vulnerable communities and vulnerable consumers are able to get the full benefit of the type of reform that we’re proposing—is the establishment of the economic regulator. And the member will be aware that the next two bills will help support the substance of the role and function of water service entities as well as the transitional provisions, and also provide the architecture around economic regulation. Once we have the economic regulatory piece in place, then we’re able to give greater assurance around the way in which funding and pricing plans determine better outcomes for all citizens.

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

SIMON WATTS (National—North Shore): Thank you very much, Mr Chair. I want to move to three more clauses that we haven’t discussed so far in this debate, and they relate to clause 133—that’s the first one that we’ll go through, which is around the amendment of the Government policy statement. These questions are generally short, so I appreciate the ability to engage in some responses in regards to this. But I’m wanting clarity from the Minister in the chair, Nanaia Mahuta, in regards to clause 133, which is around what will be the role of Government in terms of the Government policy statements included within this subpart. How much input does the Minister expect that central government will need to have or will have in regards to the preparation of those policy statements?

The second question I’ve got is in regards to clause 141. The Minister will be aware that I’ve got a tabled amendment in regards to clause 140, but my point around clause 141 is in regards to—this is the mechanism in which, post the Te Mana o te Wai statements being prepared by mana whenua, the water services entities must respond to those statements. So the question that I’ve got in regards to that is actually how much influence or how much change, if any, does the Minister envision will result in regards to that response or feedback process back from the water services entity to mana whenua in regards to the Te Mana o te Wai statements? The Minister, in her feedback back to the committee before, used words such as “the Te Mana o te Wai statements are not binary”, I think was the quote that I had, but the reality is these statements are binding. So I think there’s quite a subtle difference in terms of—while they might be non-binary, they are binding in terms of, actually, the need to comply.

So I’m wanting some clarity from the Minister in terms of how she foresees that engagement process between the water services entity and mana whenua and how much impact these statements will actually have on the core business of the water services entity. You know, there was a description and some dialogue we had previously in terms of the role which we envisage these statements to play, and I acknowledge that and we’re not going to get into that, but how much influence, in reality, does the Minister foresee that these statements are actually going to have in regards to the core business of the water services entity?

The last point I want to cover, if I may, is in regards to my Supplementary Order Paper 299 in regards to clause 140. The Minister will be familiar with this question—we discussed this in the committee today—but I’m still not satisfied in regards to why groups outside of mana whenua are excluded from having the ability to input into these Te Mana o te Wai statements, on the basis that these statements are binding on the water services entities. The Minister has said in her own words that there are other groups that have been, you know, engaged with in regards to setting the principles around these statements. So why is it that these groups are excluded?

I’d appreciate a little bit of context in terms of that, because I think it’s really important that—you know, I use the example of someone in rural New Zealand who’s got a farm, and I’m looking at Barbara Kuriger, who knows a little bit about farming; you know, just a little. But, you know, many of us have a river or a stream or drainage going through the farm—very, very common, in the Waikato particularly. So, therefore, if you’ve got a river or a stream going through your farm, why is it appropriate, in terms of the Te Mana o te Wai statements that are prepared by mana whenua, that, for example, that rural community or that farmer that owns that land doesn’t have the ability to input into those statements? I’m sure that in terms of the concepts of those statements and the concept in terms of the environmental role that they play, and I think the Minister articulated earlier—why is it so that those groups are excluded?

Surely, it would add more power and more value and be better for future outcomes, both in terms of environment but also in terms of the community aspect, if more than just mana whenua had the ability to input into that statement.

ANNA LORCK (Labour—Tukituki): I move, That the question be now put.

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

Ayes 76

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Motion agreed to.

CHAIRPERSON (Greg O’Connor): The question is that the Minister’s amendments to Part 4 set out on Supplementary Order Paper 306 be agreed to.

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

Ayes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Amendments agreed to.

CHAIRPERSON (Greg O’Connor): The question is that Simon Court’s amendments to Part 4 set out on Supplementary Order Paper 295 be agreed to.

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

Ayes 43

New Zealand National 33; ACT New Zealand 10.

Noes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Amendments not agreed to.

CHAIRPERSON (Greg O’Connor): Simon Court’s amendments to Part 4 set out on Supplementary Order Paper 305 are ruled out of order as being contrary to a previous decision of the committee.

The question is that Simon Watts’ amendments to clause 140 set out on Supplementary Order Paper 299 be agreed to.

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

Ayes 43

New Zealand National 33; ACT New Zealand 10.

Noes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Amendments not agreed to.

CHAIRPERSON (Greg O’Connor): Hon Eugenie Sage’s amendment to Part 4 set out in Supplementary Order Paper 286 are ruled out of order as being contrary to a previous decision of the committee.

The question is that Hon Eugenie Sage’s amendment to clause 164A set out on Supplementary Order Paper 296 be agreed to.

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

Ayes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Amendment agreed to.

CHAIRPERSON (Greg O’Connor): The question is that Simon Watts’ amendment to clause 166 set out on Supplementary Order Paper 300 be agreed to.

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

Ayes 43

New Zealand National 33; ACT New Zealand 10.

Noes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Amendment not agreed to.

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

Ayes 76

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 43

New Zealand National 33; ACT New Zealand 10.

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

Ayes 76

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Part 5 agreed to.

Part 4 as amended agreed to.

Part 5 Monitoring

CHAIRPERSON (Greg O’Connor): Members, we come now to Part 5. Part 5 is a debate on clauses 169 to 194, “Monitoring”. The question is that Part 5 stand part.

Hon NANAIA MAHUTA (Minister of Local Government): I don’t intend to take a long call on this particular part because the provisions roughly mirror those that are in the Local Government Act (LGA) 2002, and relate to system stewardship. This is overall a beneficial outcome in terms of long-term improvements to the way in which water service delivery occurs. It enables the ability should a problem be identified, and that is in clause 174 of the bill, in terms of problem definition. Should that threshold be met, the Minister can have three avenues to try and explore the extent of the problem. The actions are proportional to the problem that’s been identified. Those three layers are either to appoint a Crown review team, a Crown manager, or a Crown monitor, and that will enable the problem to be investigated or identified, considered, and then relevant actions taken.

So proportionality matters, having a threshold of action matters, and having various mechanisms for which the Minister is responsible for to be able to ensure that the system is working in the way that it is supposed to. I commend this part of the bill to the House primarily, again, because it mirrors clauses that are already in existence with the LGA 2002.

PENNY SIMMONDS (National—Invercargill): I’m interested to get a little bit more detail from the Minister on what specifically might trigger these ministerial interventions and also just some clarification, because the Minister talked about the appointment of a Crown manager when she commented just before, and I don’t see anything in here that talks about a Crown manager. I can see the monitor—in section 169 is the appointment and role of a monitor, clause 175 is the appointment of a Crown review team, and clause 177 is, as the Minister made a point of, a Crown observer, so—

Hon Nanaia Mahuta: Clause 179.

PENNY SIMMONDS: Clause 179 has the next step of appointing a Crown manager, so—thank you, 179. So as well as the monitor there are the three further steps: the review team, the Crown observer, and then the Crown manager. Although the Minister said it mirrors what is in there for the local authorities themselves, it does seem to be particularly heavy in terms of interventions available to the Minister, particularly when the local authorities own these assets.

So I’m interested to know what power for intervention as owners there are for the local authorities, and, if there are none, why are there none? It would have seemed like that is the logical first step, that, in fact, the local authorities would want to be able to monitor. That would be, I would have thought, the first remedial action, that if the local authorities are still the owners, that there should be some ability for intervention from the owners before working through these steps.

I’m interested to know about the appointment of the monitor, and that’s in clause 169, and how the Minister will appoint a monitor and in fact what relationship that monitor might have with the local authorities, or is the monitor going to be reporting to the Minister or how the relationship will work there. And then what the specific circumstances are that might trigger each of those layers of intervention by the Minister. That is, the intervention of the Crown review team as noted in clause 175, and the intervention of the Crown observer as noted in clause 177, and then, of course, clause 179—which I’m interested that we are able to be discussing because Part 5, sorry, Part 5 does include, of course, 179. So my apologies there, it’s obviously getting late in the day. So those—

Lemauga Lydia Sosene: You’ve got until midnight.

PENNY SIMMONDS: Exactly. And aren’t we looking forward to that? So we are certainly very, very, very keen—

Chris Bishop: Who’s responsible for that?

Hon Members: You are!

Chris Bishop: Oh ho ho—we are? Righty-o—32 bills in the order paper motion!

PENNY SIMMONDS: Mr Speaker—

CHAIRPERSON (Greg O’Connor): Mr Bishop, I can’t hear your fellow member. So just keep your voice down, please. Carry on, Ms Simmonds. I’ll give you an extra 10 seconds.

PENNY SIMMONDS: Thank you, Mr Chair. Because these matters, and I know there’s been a lot of accusations backwards and forwards—but these are matters that the public, and particularly those that are involved in local authorities, will want to be very clear about. They will want to know why they don’t have those powers of interventions themselves, they will want to know what relationship they might have when interventions do occur, and they will want to know what it will be that will trigger those interventions. I think the public deserves to be made very aware of those matters, and while the accusations were flying, this is a very serious and important matter for our ratepayers, for our local authorities. So thank you very much, Mr Chair.

SIMON WATTS (National—North Shore): Thank you very much, Mr Chair, and I want to carry on from the points and clauses that have been raised by my friend and colleague Penny Simmonds in regards to Part 5, and in particular, I guess, building on the questions that Penny Simmonds has raised in regards to the concept that we discussed in the prior aspect—around the fact that, actually, these territorial authorities have been told right from the outset that they actually own these assets, right? We’ve heard that right throughout the process: “You own the asset; you’ve got a shareholding in that.” But yet the question I have for the Minister is: why is there not the ability or a clause within Part 5 that allows—and I guess particularly under Subpart 2 could be the mechanism in which you could enter it—for councils who actually still technically own their assets?

If we follow through the narrative that has been set, why do they have no powers for them to intervene in regards to the information-gathering powers around these entities, which is under clauses 170(1) and (2)? Why couldn’t, in effect, those councils provide a role in terms of providing monitoring? Because, actually, you know, don’t forget the assets which are going to form part of these water services entities are assets that are owned and have been funded by these councils. So surely they will have a vested interest, or they definitely will have a vested interest, in regards to making sure that these water entities are delivering the outcomes that they are planning to do, in terms of their intent in that. So my question around that is: why do they not have the powers to intervene in that regard?

The other question that my colleague Penny Simmonds noted was for the Minister to provide some context in terms of what are the exact circumstances on ministerial intervention? Because, while I acknowledge the Minister said these clauses are replication out of the Local Government Act, the water services entities is a very different set of circumstances than in the local government environment. And, in effect, the whole premise of these entities is that they would be independent. We’ve heard the Minister articulate the reasons why that degree of independence from both councils and other parties is so critically important—financial basis, etc.—and whether we believe that or not, that doesn’t matter; the point is that they are independent. So what are going to be the trigger points for that ministerial intervention?

And the third question I have in regards to that is that the Minister also noted before, in regards to context, that the threshold for Government actually getting involved is going to be very, very low, whereas, you know, we’ve got some pretty heavy aspects around monitoring—a three-tier approach, in effect, in regards to this—and I’m sure, for any of the members that are in Tauranga at the moment, I mean, they’re in a council that’s being managed by Crown-appointed officials, and we note that is the situation. But the circumstances which triggered that were what they were. But, in effect, these are different, because these are independent entities with a board structure and a governance structure which is much more wide ranging than what we do have in the normal local government or a council scenario.

So I would like the Minister to provide some—how is she confident that, actually, that trigger point for intervention, what it looks like, is not overreach in regards to what is actually the problem that this part of the clause is trying to mitigate? So those are the questions I’ve got in regards to Part 5, and we’ll come back.

Hon NANAIA MAHUTA (Minister of Local Government): There is a different function in terms of system stewardship and the role of the monitor, in relation to the threshold that needs to be met, which is set out in clause 174, and then the actions that the Minister can take that are proportionate to the problem that’s been identified and needs to be resolved. The other thing I should mention is that the monitoring function is a role of a department, and it has a specific purpose that is separate to the review team that might be appointed, or the Crown manager that might be appointed, or the Crown observer that might be appointed. So that’s the other thing.

I’d also like to just highlight that, from a regulatory point of view, the matters that would be significant to be looked at are set out in clause 174. So let’s just go through these. Clause 174: “(a) a matter or circumstance relating to the management or governance of the entity that detracts from, or is likely to detract from, its ability to give effect to its purpose; and (b) a significant or persistent failure by the entity (i) to perform 1 or more of its functions or duties under the Act; or (ii) to give effect to a Government policy statement issued by the Minister under section 129; and (c) the consequences of a state of emergency … affecting, or recently affecting, the entity’s service area”—so that could be systemic failure of core essential services—“(d) a failure by the entity to demonstrate prudent management of its revenues, expenses, assets, liabilities, investments, or general financial dealings;”—so at that governance level—“and (e) a potential problem that relates to a matter, circumstance…[identified in]…(a), (b), or (d).”—which I’ve read out.

On other fronts, where it would be legitimate to expect that the water services entity should be accountable for the way in which they operate, those matters will be dealt with by the other two regulatory functions—firstly Taumata Arowai, because they are the drinking regulator. So the ability to oversee the performance of the water services entities in relation to meeting the drinking water standards is a matter for Taumata Arowai. In terms of economic regulation and making sure that the strategic documents that help to drive economic and fiscal financial efficiencies—that will be a matter that will be overseen by the economic regulator.

CHAIRPERSON (Greg O’Connor): The question is that Part 5—

Brooke van Velden: Mr Chair.

CHAIRPERSON (Greg O’Connor): Oh, I’m sorry. The member needs to call.

Dr DUNCAN WEBB (Chief Whip—Labour): Point of order. With respect, Mr Chair, the vote was being taken.

CHAIRPERSON (Greg O’Connor): No, I hadn’t completed it, so the member can have the call. But just—please call.

BROOKE VAN VELDEN (Deputy Leader—ACT): Thank you, Mr Chair. I was hoping that the Minister might be able to just elaborate a little bit about the monitoring function and the powers of the Government in regards to the monitoring function, because we were talking a little bit about where you’ve got the department which has a different role again to the Minister appointing a Crown review team, but at the same time, it seems like there’s an awful lot of bureaucracy here as to at what point different entities start getting involved.

I noted here that in clause 169 it says that “The Minister must appoint a department to be the monitor.”, so we’ve got constant monitoring happening from the departmental level, and then the Crown review team may be appointed by the Minister if the Minister suspects that something has gone wrong—that there’s been a problem. But in clause 174, it starts talking about what does it mean if there could be a problem, and one of the problems it identifies under clause 174(b)(ii) is that there’s a significant failure by the entity to give effect to the Government’s policy statements “issued by the Minister in section 129;”.

So I’ve gone away to look a little bit at how that refers to clause 129, and it says that “The Minister may issue a Government policy statement on water services.” But then, going into detail on that, that says that it refers back to clause 11. Now, in clause 11, it is talking about what the objectives of the water service entities are. So under this Government policy statement, you could be talking about things like mitigating the effects of climate change, protecting and promoting public health, and—importantly—enabling planning processes, growth, and housing and urban development.

But, of course, all of these are from the Government side, rather than from any council side or a local community side, and so it appears to me that we have got a Government getting increasingly involved in local planning and local issues. Is it possible, then, that we could end up in a situation where the local council actually has no control at all over their own water service entity, because not only is there a department that they didn’t ask for overseeing them and monitoring them but you then have the Minister getting involved and putting in place a Crown review team because they are not doing an adequate job of the Government’s policy statement and enacting the Government’s policy statement?

So how is it possible that we can have any local voice about where local town planning wants to take place or where housing and urban growth wants to take place when it’s really then become an issue of the housing Minister and the environment Minister, and all of those things interconnecting and overriding any of the water service entity board? I think there are a lot of people who would be really concerned that that means, in effect, that everyone will be just doing what the Government is wanting to do with a Government policy statement, rather than what the local council and people who are in charge of the water service entity want to see in their local community.

Hon NANAIA MAHUTA (Minister of Local Government): I realise that the member might not have been here when I opened this particular part, but when I said that the functions in Part 5 mirror the existing—well, some of the mechanisms in the Local Government Act 2002, the Department of Internal Affairs oversees councils as it currently stands and the threshold in order for the Minister to intervene is quite high. That threshold in this bill is clause 174. It is a very defined set of actions or considerations that must be taken into account before the Minister can intervene on those three layers, and that level of intervention is proportionate to the problem that is identified and needs to be resolved.

That sits outside of the two other regulatory aspects, which I’ve explained to the committee. This won’t be overreach in terms of the role of Government, but this is a necessary system oversight role that should be taken in relation to ensuring that the water service entity complies with its functions as set out in the legislation, much like councils do in relation to the Local Government Act 2002.

Part 6 Miscellaneous provisions

CHAIRPERSON (Greg O’Connor): Members, we come now to Part 6, which is the debate on clauses 195 to 228 and Schedules 3 and 5, the “Miscellaneous provisions”. The question is that Part 6 stand part.

Hon NANAIA MAHUTA (Minister of Local Government): Thank you, Mr Chair. There are two clauses in this particular part that, over the duration of the debate in the Chamber, I should bring the attention of members to. Firstly, there has been a lot of discussion in the Chamber around engagement and what is taken into account and what things are engaged on and how. That is set out in clause 202. And then, in relation to the interests of consumers—so what we have in both clauses 203 and 204 are provisions that relate to consumers, that will over time help to improve and evolve the way in which water service entities engage with consumers.

By way of example, because there were comments in earlier parts of the debate, that this will be a cost burden on water service entities—but if we look to current examples that support efficiency outcomes in service delivery areas, we only need to look to Watercare. They have a customer service engagement strategy that supports the efficiency gains of the whole operation of the organisation, and that has been built into the service delivery approach that Watercare has taken.

There are many other organisations that engage with consumers in order to improve not only how they present or what they do but, actually, to get live feedback around what it is that matters most to consumers when they’re working with an organisation. So that’s partly the intent of ensuring that we don’t leave it to chance and we make it express in legislation.

SIMON WATTS (National—North Shore): Thank you very much, Mr Chair, and it’s a pleasure to rise and have a discussion on Part 6 and ask some questions in regards to this. The clauses that are particularly of interest within Part 6 relate to, in effect, the review provisions that are in the Water Services Entities Bill, which, basically, in terms of Subpart 1, enable detailed reviews to be conducted by the Minister on various components of the Act at the fifth anniversary of the commencement date, and in particular that the review will also review Crown commissioners, if appointed, at that point and the general function of the system as a whole. So that’s interesting in itself, but the questions that I have for the Minister, the Hon Nanaia Mahuta, are as follows: the first aspect is in regards to the duration in terms of the anniversary time. Why does the Minister feel that five years is appropriate? Geez, I must say it’s been a long five years, hasn’t it?

Andrew Bayly: Long five years.

SIMON WATTS: I didn’t want to raise it, but I thought—

Dr Duncan Webb: Point of order, Mr Speaker. [Interruption]

CHAIRPERSON (Greg O’Connor): Mr Bayly, could you sit down? Mr Bayly, this is not a public house. Please don’t come in here from the floor and start screaming whatever you’ve been doing at dinnertime. Sit down and be quiet, please, and be quiet for the rest of the evening. Mr Watts, I’ll make up the time.

SIMON WATTS: Thank you very much, Mr Chair. I was so deeply in thought on this clause that I missed that whole—

CHAIRPERSON (Greg O’Connor): We won’t do a rerun!

SIMON WATTS: Ha, ha! We won’t do a rerun—absolutely not. Good to have you here, Mr Bayly. Right, anyway, so where was I? I’m getting a little bit lost. Five long years, I think I was talking about. The question to the Minister is: why the duration of five years? What’s the basis on which you deem that that’s an appropriate point?

The second aspect in regards to this is around what the Minister deems to be a review of the general function of the system as a whole. That sounds pretty generic in the context of—you couldn’t make it much more generic than that. So is the Minister actually expecting a full-scale review in terms of the overall system, around what has been intended? I’m sure part of that review will be listening back to the Hansard of this evening and asking, “Well, what was the expectation of what these entities and these water services entities would deliver? And what have we actually been able to achieve in five years?” What is the scope of that review, and how far does the Minister envisage that will go in reality? I guess, as a result of that, what is going to be done? Because a review is one thing, but I’m interested to see if there is an expectation around any change to follow that.

The third aspect is in regards to the mechanism, in terms of feeding into that review process, and in particular what is the mechanism that will exist that allows for councils to provide feedback back to the reviewers as part of that process—and particularly, I guess, as councils are probably best placed to be able to understand the issues that their community has. What is the mechanism under Part 6, Subpart 1, in regards to clauses 197 and 198, “Reviewer’s power to request information”? What is the mechanism that we envisage for that feedback process to happen across the 67 councils? And how do we ensure that, actually, we do get a genuine assessment, in terms of feedback in regards to the success or not in regards to these waters services entities, and that it’s not just a consultation for consultation’s sake or a review for review’s sake? I think it would be fair to say that, hopefully, in five years’ time from now, Kiwis will be a bit more confident and have a higher degree of trust in the Government of the day, but the reality is that this reform process has left a pretty sour taste in the mouth of many Kiwis, in regards to whether that consultation process has been authentic or not.

The last aspect is in regards to how, in terms of the review process, the public themselves will be able to engage and interface with these mega entities. I know we haven’t necessarily touched on it this evening, around the consumer engagement. Clauses 203 to 205, of Subpart 1 of Part 6, are in regards to that. I’d like the Minister to provide an overview of how she envisages that consumer forum aspect to work in practice. How is it actually going to be effective in the context of making sure that we get widespread representation across our communities around the country, and particularly I think about rural and provincial New Zealand? We have a number of members in the Chamber here representing those communities this evening. How are we going to ensure that that aspect is fed in appropriately? But, more importantly, how are we actually going to make sure that that feedback is, again, not just token feedback—that it’s actually feedback in an authentic process? Actually, Kiwis generally feel that, if I’m going to give feedback, it’s going to get listened to, and if it’s going to get listened to, that there’s actually going to be some change as a result.

So some confidence around that consumer forum—not that it’s just a consumer forum off to the side, and I think of consumer forums in the Pharmac context. I know it’s a different aspect to the bill, but the reality is that those consumer forums are literally tokenistic in terms of the role they genuinely play in terms of their ability to feed back—or, actually, for the entities—and in that regard, while different, an independent entity actually takes on board that feedback and makes policy changes as a result. So I think it would be fair to say that Kiwis would be right to have a low degree of trust that, actually, these consumer forums are actually going to lead to effective change, and so the ability to provide confidence and comfort around the fact that it is going to do what it’s meant to do would be appreciated. Look, I’ll leave it there, in terms of the first round, and then we’ll come back a little bit later on.

Hon NANAIA MAHUTA (Minister of Local Government): I’ll take a brief moment to respond. Firstly, in so far as the review is concerned, there are two reviews. In the first instance, it is to look at the roles, functions, and responsibilities of the water services entities five years after the commencement date of this particular legislation. But the question was: why five years? If you look at the go-live date that’s intended for the water services entities, that’s 1 July, 2024. And, then, if you factor in when economic regulation comes into place, which is July 2027, five years is a good period of time to review how the system is working. That is why it’s 10 years for the whole system and we’re including not only Taumata Arowai, the water services entity, but also economic regulation and the overall system-wide benefit of reviewing the system after 10 years. So that’s the first point on the review period and why that period of time.

On consumer forums, what we do know from existing practice and best practice is that having consumer forums can continue to improve the service delivery operational benefits of an organisation. And in this instance, it’s the water services entity. It’s outlined in clause 203 and clause 204, the way in which consumer engagement can take place and what is covered. The point that the member raises, I think, is how we can be assured that views will be taken account of. And, again, that is set out in clause 204.

The other thing to note is that there are layers of engagement with different types of interest that are represented throughout the reform. For example, there is an opportunity through the annual general meeting of the regional representative group for the water services entity’s functions to be reviewed during that accountability process.

In terms of engaging with different types of consumers—and I’m thinking that members on that side of the Chamber have raised, you know, the rural community. They are a bespoke set of consumers that not only use water for drinking but primarily for production. That could be a consumer forum that is targeted across a particular entity because of the profile of the entity. But so too could industry users and particular sectors. And there is the flexibility within the formation of consumer panels for a water services entity to better engage with consumers. And then there is the opportunity that we anticipate if we look at best practice and comparative examples for the economic regulator to also assess the way in which consumer outcomes have been achieved by the water services entities.

SAM UFFINDELL (National—Tauranga): Thank you, Mr Chair—we were having a little internal discussion about who would win that call, and I’m glad I did. I wanted to rise to talk on clause 205, the “principles of engagement”, and in paragraph (a) there it states “the entity’s communication [and] communities should be clear and appropriate and recognise the different communication needs”. I was wondering if the Minister would be able to expand a little bit more on that: are we talking simply mailing out, are we talking about digital stuff, or are we talking about forums where people can engage in that process? I mean, if it is forums—I’m assuming it is, because we’ve had a fair bit of discussion on that already—you know, what is the balance that would be placed on those? Because we’ve seen already in the forum opportunities 88,000-odd submissions and not necessarily a lot of reflection on those and the acts of the community and the acts of the local councils. So if we had a feedback mechanism, as is proposed through this engagement—is there a ratio or percentage of voices that the Minister would look at and consider, and then move to, you know, potentially amend the water services entities, or potentially scrap them altogether, if that was what was being asked for?

I note in paragraph (b), “the entity should be openly available for consumer and community feedback”. I’d just like to ask—and it might seem, you know, a little bit sarcastic in a sense, but it’s not; it’s a genuine question—how open is the Minister to this feedback? Because from what we’ve seen so far, there hasn’t been a lot, and I think my colleague Simon Watts touched upon it earlier. We’re not high on faith on this side of the House that the feedback that will come in—we’ve seen it with councils, we’ve seen it from experts in the field—when it comes back from the community, whether that will actually be taken on board.

If I look at paragraph (d) “the entity should consider the changing needs of consumers and communities over time, and ensure that engagement will be effective in the future.” How confident is the Minister that, as they are established, that they’re meeting the needs of the communities? How do the major stakeholders—what was their feedback to you, Minister? Do they feel that these entities, as they begin, are going to be properly represented? And as you’re going through the principles of engagement; what sort of time frame are we talking about with this engagement? And my colleague touched upon a little bit earlier—but, you know, one should reasonably expect it to be fairly regular. We heard five years termed “earlier”—I mean, it is an extremely long time between drinks. But if we could get a bit of clarity around, you know, when you’re outlining the principles of engagement, how regularly are you intending to engage or send out these communications to communities to allow them to then feed back in on how they feel about everything?

Paragraph (e) there, under clause 205: “the entity should prioritise the importance of consumers and community issues to ensure that the entity is engaging with issues that are important to its consumers and communities.” What is the Minister’s take on, you know, issues such as governance, such as ownership, such as equality? I kind of get the feeling, reading through this, like I’m reading back through Animal Farm and we’re all equal, but just some are a little bit more equal than others. Minister, those are my questions to you, and I’d be very interested to hear your response, in time.

Hon KIERAN McANULTY (Associate Minister of Local Government): If any students of politics wish to see an attempt to filibuster, they only need to look at that last speech—just simply reading what was in the bill and then asking a question as we go through. But I’ll go through: he summed it up when he said, “I assume it’s forum because we’ve had a lot of discussion on this already”. That’s correct, we have covered this in great detail.

The question about paragraph (b), how open is the Minister to this feedback? Well, it’s not actually feedback to the Minister; it’s feedback to the entities, and they will be incredibly open because they are required to engage in a manner which is suitable for those communities.

In reference to the five years—just a point of clarification, that’s not the time frame for the engagement; that was the time frame for the review that is set down in here. And specifically to Mr Watts’ question: the Government’s Supplementary Order Paper strengthens the role of the forums to ensure that engagement is sound and genuine.

PENNY SIMMONDS (National—Invercargill): Thank you, Mr Chair. I’m interested in getting a little bit more information from the Minister on clause 203, “Consumer forum”, and I’ve been reading through, trying to decide whether the obligation on the entity is to establish a single forum, or, in fact, whether fora—plural—might be an expectation, because if you look at subclause (3), “A consumer forum may be established under this section—(a) for the whole or part of a service area; and (b) in relation to all, or a particular class of, consumers.”

From that, I am presuming that there may be a number of fora established, so you would hope that it couldn’t be just one that only covered part of the service area. And I suppose that’s where I get concerned, again, about the smaller local authority areas, the rural areas, where unless they are going to be in some kind of particular class of consumers, they might get further disenfranchised from this process if they are not included in it.

So it’s around whether there might be a standing forum that covers the whole service area, whether there might be multiple fora in that, with some covering just parts of the service area and some just covering parts of a particular class of consumer. Again, just really wanting to tease out how this won’t become just a tick-box exercise, because many of us are familiar with the concept of advisory committees or advisory fora, and they can be very, very useful: they can give feedback; they can be really engaged with an entity and adding absolute value.

But we can quickly see in an instance where they might not be meaningfully used—that the engagement would fall off and they might feel that they are wasting their time. I didn’t actually see in here—and it may be my fault—any recompense or any payments for any of these people that might be involved in it, and so if you’re talking about that very large geographic area of the southern region, people from western Southland trying to be engaged in a forum representing rural people, are they going to have to travel to Christchurch if the head office is in Christchurch? Are they going to be expected to do that under their own steam without any recompense for it?

So I can see how advisory consumer fora might be particularly good, but I could also see how through the establishment and application and implementation of these fora, they could be made to feel like they are just ticking the box, just showing that they’ve done what’s required of them but actually not being meaningful at all. And the public is not stupid. They do not want to be used in this way, and they will quickly drop off having any sort of engagement if that is what occurs, and so it would be very useful to get some further feedback from the Minister on this. Are we talking a standing forum, are we talking single-purpose fora, are we talking about where they may gather information if there’s a particular development going on from a particular class of consumer? So just really wanting to tease out what these advisory groups—they look to me like advisory groups—might be like and how they might actually be implemented. Thank you very much, Mr Chair.

Hon KIERAN McANULTY (Associate Minister of Local Government): Thank you, Mr Chair. I thank the member for her question; I know that it’s genuine and sincere. Let me reassure her that the Government Supplementary Order Paper strengthens the requirements around the forum. There will be a requirement for participation within rural, provincial, and metro areas, so if you were to take entity A, for example, it wouldn’t comply if it was just held in Auckland.

But further to that, the Office of the Auditor-General worked with the Department of Internal Affairs to ensure that there will be an audit requirement over these consumer stocktakes.

BROOKE VAN VELDEN (Deputy Leader—ACT): I thank the Minister for his comments. I think there are an awful lot of people who are concerned in our communities, who do want their voices heard, not just on this piece of legislation but on a lot of legislation that the Government is putting through. But I still think the Government and the Minister need to elaborate further on what this consumer voice means in this legislation. I’m specifically looking at clauses 203, 204, and 205. I think it’s quite wonderful that we have the idea of having a consumer forum so that people can have meaningful consumer and community engagement, that they can compile consumer views, so that the water service entity can understand the consumer needs, their expectations, and their service requirements. I think that’s really quite wonderful because it’s all about how does this entity interact with the community and what they need so that they can get clean and safe drinking water.

But I still question how this works in effect when Part 5 had the issue of the Minister being able to appoint a Crown review team to look into what’s happening at the water service entity, because, you see, we’ve got in one hand consumer engagement that should be leading how this water service entity is managed and how it will work over time to represent the consumers of the region. But, on the other hand, we have the Minister being able to get involved with the Government policy statements, and I really don’t think that they work together. So, on one hand, you can have the Minister saying “You as an entity have not done what the Government policy statement says, under section 11.”, and, on the other hand, you can have the entity saying “Yeah, but we’re not doing what the Government policy statement says because we’re actually listening to the needs of the community and those are different.” But if we listen, at large, to the needs of the community and if they are different to what the needs of the Government are, the Government will just override them and they will take away their ability to respond to the community.

So how is it possible that we can have proper, true consumer engagement if it means that the water service entity actually follows what the consumers and the community want, but if they do that, the Minister gets involved and overrides them because they say “You’re not taking effect of the Government policy statement.”? So I think everybody in our communities is concerned by this new law. They don’t truly understand what it means. But what does this mean specifically for consumer voice when if the entity actually follows what the community voice is, they could be overridden by the Government’s policy statement?

ANDREW BAYLY (National—Port Waikato): Thank you, Mr Chair. I’m most grateful—most grateful. I want to talk about clauses 195 and 196, just to make sure that we are very careful about talking to the correct part, Part 6.

I think clause 195 really encapsulates how this Government regards these entities, because clause 195 talks about—opening words: “The Minister must … commission a review” and all clause 195 is what the Minister must do. It finishes off in subclause (4) by saying, “Before commissioning the review required by this section, the Minister must consult … other Ministers of the Crown (for example, any whose portfolio responsibilities are affected by or relevant to the review) that the Minister thinks fit.”

Now, we’ve heard all along that these water companies are owned by councils. We discussed this in the previous part, under clause 166, and we talked about the rights of shareholders and we talked about the rights to a dividend, the rights to participate in capital, both of which are excluded specifically under clause 166. I think clause 195 further reinforces what I was saying earlier—that shareholders are genuinely entitled to be able to have a say in the future direction of their business.

Dr Duncan Webb: Wrong part. What section?

ANDREW BAYLY: In this case, the shareholders, if we were to understand and trust the comments from people like Dr Webb interjecting from the other side that councils own this, because that’s the proposition that’s being put forward by the Government, then they should be the one doing the review, not a Minister and not Ministers covering a whole lot of portfolios.

So my first question to the Minister in the chair is: why is it that the territorial local authorities as the so-called owners—and I do not believe for a moment, and no Minister or official has yet been able to stand up and have a proper conversation on—why should they not have the right to do this automatically and why shouldn’t they be controlling that, rather than a Minister of the Crown controlling it? I think that strikes to the core of what this is about: this is about centralisation and taking control and ownership away from councils—investing it, actually, in the Government.

The second thing is clause 196, “Comprehensive review of water services legislation”. As the Minister in the chair noted before, there will be a five-yearly review after the establishment of this entity. We all understand when it’s going to take place, in 2024. Clause 196 requires that on the ninth anniversary—it ends on the 10th anniversary of the establishment date; i.e., the same day—there will be a comprehensive review of the water services legislation. Now, I cannot understand the logic of this.

If you do a formal review, even if it is a Minister doing it, rather than the councils—and I’m very keen to understand whether councils can initiate other reviews—even if the Minister does the five-year review, why would it be that you specify in a piece of legislation that you do it five years after that review? What is the logic of that? If you a review and decide that you need to make a change, why wouldn’t you make it flexible in the bill, along with using words such as “soon as practicable thereafter” of clause 195, that you implement legislative change? What is so compelling in the logic that you do a review and then you wait another five years—and I can see members on the other side nodding, going, “Yes, that makes sense.”

This is a piece of legislation that’s poorly drafted. There should be flexibility about when this takes place. It should be flexible—again, like clause 195, the councils should have the right to require that the legislations change, because if they really did have control, then they would be able to require this of the Minister. Rather than Labour thinking that the Minister should be telling everyone what to do, the council, if they really were the owners, would be telling the Minister what they want.

CHAIRPERSON (Greg O’Connor): Just before I take the next call, can I just remind members that different members saying the same thing does not constitute new material—just as an observation.

MATT DOOCEY (National—Waimakariri): Thank you very much, Mr Chair. I just want to build on what Mr Bayly was saying in his contribution, because it is interesting—there is a proposal for an interim review at five years. So I just want to drill down a bit deeper into that. What is the benchmarking where you come up with a five-year period for an interim review? Because, surely—and some of my Victoria University of Wellington public policy mates might also agree with me—the difficulties will come at the implementation stage. So why would you wait five years; why not have a review at the implementation stage yearly or bi-annually? You have the structures in place with the consumer forum and the regional representation group, then why wait nine years for a comprehensive review?

Well, we all know why it’s a nine-year wait: because we want everyone to swallow the dead rat and, then, maybe after nine years, it’s digested and it’s being excreted and they might have forgotten the foul taste of that dirty rat in their mouth. So I would say “Why wait five years? What is the benchmark for nine years for a comprehensive review?”

And to the Associate Minister, the Hon Kieran McAnulty, who spent a lot of time talking about his trip to every council in New Zealand and how he was going in to listen, and, finally, we get to ask the Associate Minister what did they actually say? Was it true when they said great guy, wrong party? And that’s what every council said when he went round. Because he knows, as much as everyone, this is a dead rat that he needs to swallow.

But let’s put it on the table and let’s ask the Minister if he’ll agree, tonight, to putting a clause in under the interim review or the comprehensive review. How about, in the review, if the ratepayers don’t like it after five years and nine years, we pull the pin? How about that? Because let’s remind ourselves, this Government said people could opt out. Remember that? The good old days. Until they got caught out and realised it was a legislative all-in. So why not have the ability in the review process that, if a council decides, maybe it could be by majority of the ratepayers—I know in Waimakariri they had 95 percent of ratepayers who wanted to opt out—maybe, if there’s a majority—

Dr Duncan Webb: Five regions lodged consents in breach.

MATT DOOCEY: —they can opt out. I’d be interested to hear—well, and Duncan Webb makes a contribution. The guy who’s been silent, in his electorate of Christchurch Central, on three waters for the last year has now woken up. And let’s not forget, Garry Moore, the left-leaning former mayor of Christchurch, who was Duncan Webb’s campaign manager, resigned from the Labour Party because of three waters and went and wrote a letter to the editor in the Christchurch Press and said he’ll never be Duncan’s campaign manager again because of three waters. Now, he’s found his voice as the bill’s getting rammed through under urgency. Yeah, that’s right. And you know what they called that? A lion in Wellington and a lamb in the electorate. That’s exactly what they call that. Thank you, Mr Chair.

Hon KIERAN McANULTY (Associate Minister of Local Government): Just to clear a few matters up that have been raised, both Mr Bayly and Mr Doocey tried to traverse areas that were covered in great detail by the Minister earlier. There wasn’t a new question posed in that. However, Ms van Velden did ask a question regarding the Government policy statement (GPS) and the forums. I just wanted to reassure her that the GPS, the monitoring function, and the consumer forum all serve very different purposes, and she was conflating the purposes of all three.

ANNA LORCK (Labour—Tukituki): I move, That the question be now put.

SIMON WATTS (National—North Shore): Thank you very much, Mr Chair. I want to have a discussion around clause 204, a clause that we haven’t discussed to date, in regards to the consumer engagement stocktake. I want to link back to a point that I raised earlier in regards to the Office of the Auditor-General. You’ll remember back in terms of quite a scathing report that the Office of the Auditor-General provided on the initial version of the bill in regards to concerns. The point that the Office of the Auditor-General raised in regards to clause 204 around consumer engagement stocktake is as follows, and I quote: “The bill does not currently clearly link the findings from the consumer engagement stocktake”—which is the clause we’re referring to—“with corresponding reporting requirements, such as the statement of intent. There are also some limitations in the accessibility of the mechanisms proposed for public reporting.”

The question that I have for the Minister is in regards to the issues raised by the Office of the Auditor-General—and I think rightfully so—around the linkage of clause 204 in terms of that engagement stocktake with the other provisions of the bill, noting that some of the other provisions don’t sit within the part which we’re discussing, but I thought this would be the appropriate time to raise it.

Does the Minister have confidence that the way in which the clause is now drafted in the bill deals with the issues that were raised by the Office of the Auditor-General in regards to that? That’s because, while the Minister in the chair, the Hon Kieran McAnulty, may not be aware, the Finance and Expenditure Committee did not have a process to get subsequent feedback in detail over and above the initial letter of concern that was raised by the Office of the Auditor-General on the bill. We simply got assurance from officials that that correspondence and dialogue had occurred, but we didn’t have that confirmation from the Minister, and that is the certainty that I’m seeking in that regard.

The other point that I just want to raise, and it’s a point that was raised by Minister Mahuta previously in the chair, was in regards to a comment around the timing of the five-year review process that we referred to there in clauses that were just raised by my friend and colleague Andrew Bayly in regards to the review period. But she noted an interesting comment, which was that the economic regulation is not going to come into force until 2027. That’s quite interesting in the context that while that bill is not a bill that’s currently on the Table or is a bill that I’ve had any oversight of—I’m sure members on the other side in Government will. But the Minister did make their comment in the conversation and the dialogue, so it does bring it within scope in terms of the conversation here.

So I’m seeking confirmation around the fact that, actually, is that the intent? Because that opens up quite an interesting perspective. Why would the economic regulation portion, which will follow in a subsequent bill, come in at a period so late in the piece, three years beyond where we would expect? What is the rationale when you link that back to this bill here? So two questions: one around the Officer of the Auditor-General around clause 204, and the second one is some clarification around the Minister’s comments around when the economic regulation aspect will come into force. Thanks, Minister.

ANAHILA KANONGATA’A-SUISUIKI (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 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Motion agreed to.

CHAIRPERSON (Greg O’Connor): The question is that the Minister’s amendments to Part 6 set out on Supplementary Order Paper 306 be agreed to.

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

Ayes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Amendments agreed to.

CHAIRPERSON (Greg O’Connor): Simon Court’s amendments to Part 6 set out on Supplementary Order Paper 305 are ruled out of order as being contrary to a previous decision of the committee. The Hon Eugenie Sage’s amendment to Part 6 set out on Supplementary Order Paper 286 is ruled out of order as being contrary to a previous decision of the committee.

The question is that the Hon Eugenie Sage’s tabled amendment to Supplementary Order Paper 285 be agreed to.

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

Ayes 10

Green Party of Aotearoa New Zealand 10.

Noes 107

New Zealand Labour 64; New Zealand National 33; ACT New Zealand 10.

Amendment to the amendment not agreed to.

CHAIRPERSON (Greg O’Connor): Members, we’re about to vote on an amendment which is a proposal for entrenchment requiring a 60 percent majority for repeal or amendment of the entrenched provision. Under Standing Order 270, this proposal must be carried by that majority. Therefore, this amendment must be agreed by a 60 percent majority, which would be 72 members. The question is that the Hon Eugenie Sage’s amendment to insert new Subpart 4A into Part 6, set out on Supplementary Order Paper 285, be agreed to.

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

Ayes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Amendment agreed to.

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

Ayes 76

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Part 6 as amended agreed to.

Schedule 1

CHAIRPERSON (Greg O’Connor): We now come to Schedule 1, for which there is no debate. The question is that the Minister’s amendments to Schedule 1 set out on Supplementary Order Paper 306 be agreed to.

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

Ayes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Amendments agreed to.

CHAIRPERSON (Greg O’Connor): The Hon Eugenie Sage’s amendment to Schedule 1 set out on Supplementary Order Paper 286 is ruled out of order as being contrary to a previous decision of the committee. Simon Court’s amendment to Schedule 1 set out on Supplementary Order Paper 305 is ruled out of order as being contrary to a previous decision of the committee. Simon Watts’ amendment to clause 11 of Schedule 1 set out on Supplementary Order Paper 301 is ruled out of order as being contrary to a previous decision of the committee.

The question is that Simon Watts’ amendment deleting clause 13 of Schedule 1, set out on Supplementary Order Paper 302, be agreed to.

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

Ayes 53

New Zealand National 33; Green Party of Aotearoa New Zealand 10; ACT New Zealand 10.

Noes 64

New Zealand Labour 64.

Amendment not agreed to.

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

Ayes 76

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Schedule 1 as amended agreed to.

Schedule 2

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

Ayes 76

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Schedule 2 agreed to.

Schedule 3

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

Ayes 76

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Schedule 3 agreed to.

Schedule 4

CHAIRPERSON (Greg O’Connor): The question is that the Hon Eugenie Sage’s amendment to Schedule 4 set out on Supplementary Order Paper 296 be agreed to.

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

Ayes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Amendment agreed to.

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

Ayes 76

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Schedule 4 as amended agreed to.

Schedule 5

CHAIRPERSON (Greg O’Connor): The question is that the Minister’s amendment to Schedule 5 set out on Supplementary Order Paper 306 be agreed to.

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

Ayes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Amendment agreed to.

CHAIRPERSON (Greg O’Connor): The Hon Eugenie Sage’s amendment to Schedule 5 set out on Supplementary Order Paper 286 is ruled out of order as being contrary to a previous decision of the committee.

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

Ayes 76

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10; Te Paati Māori 2.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Schedule 5 as amended agreed to.

Clauses 1 and 2

CHAIRPERSON (Greg O’Connor): Members, we now come to debate clauses 1 and 2. This is the debate on clauses 1 and 2, “Title” and “Commencement”.

SIMON WATTS (National—North Shore): Thank you very much, Mr Chair. Well, after nine hours of debate, we are nearing the end on what will be, for many, a memorable debate on a bill that is destined to fail. But the point that I want to raise in regards to clause 2 around the commencement is in relation to a Supplementary Order Paper (SOP) that I have on the Table, 303. Ha! That’s interesting, that in itself, just coming from a farming acronym. But anyway, 303—we won’t worry what that is. The purpose of this Supplementary Order Paper is to, in effect, replace clause 2(2), because it’s an interesting addition that was made to this bill. So right from the outset of this conversation, right back at the first reading conversation—I don’t know if you remember that, Mr Bayly, first reading?

Now, this was going to be an open and transparent process that was going to have full consultation and all of that. But one of the key aspects at that point was around the fact that this bill would come into effect on 1 July 2024, and that’s fair enough. That was well signalled. It gave adequate time in regards to making sure that due time was given in order to implement this bill. But the additional clause that was added in pretty rapidly after was this clause around the Order in Council, which basically provides a mechanism for the Government to be able to decide at a point earlier than 1 July 2024 if they want to implement the remaining non-transitional provisions of this legislation. And why this is an issue is because it places in an additional degree of complexity in terms of this but also goes against the principles in terms of the fact that this bill would be operational for the non-transitional provisions not until 1 July. So my Supplementary Order Paper in this regard is quite simple, and I’d ask the Minister in the chair to consider replacement of that clause and removal and deletion of clause 2(3), which is on page 12, lines 16 and 17.

I guess, just in terms of the closing remarks in regards to this bill, in regards to that commencement, it is pretty clear over the period that we’ve discussed this evening and last night and this morning that National strongly opposes this bill. It is our intention that if we are in Government next year, we will repeal this legislation and replace it soon after. And that is for the reasons around the fact that we believe these assets should remain in local ownership, we don’t support 50:50 co-governance, and we believe that the solutions to this problem do not lie within this bill, but, actually, the solutions lie within our communities, and we need to work with our communities, not against them, in order to implement solutions that are applicable for the cities, regions, or provinces in which people live. One-size-fits-all, top-down centralisation will not solve or create sustainable solutions for water services in this industry. And we’ve been open right from the start in terms of wanting to work constructively around dealing with some of those bottom lines, but I acknowledge the Government has deemed those bottom lines were not ones that they were willing to change. So I just wanted to note that for the record and Hansard. That is our expectation.

I thank everyone who has made submissions in regards to this bill over this process, and, I’m sorry, in which we have not been able to reflect those changes. That is the reality of where we are, but we will continue to fight this, and if we’re in Government next year, we will repeal and replace it.

ANDREW BAYLY (National—Port Waikato): Thank you, Madam Chair. I’m speaking to Supplementary Order Paper (SOP) 298 in the name of my good colleague Simon Watts, who has done a sterling job of identifying the key issues relating to this bill.

This SOP is about the title of the bill. I think that the specified title is an absolute misnomer; it is actually quite incorrect, because it talks about “Water Services Entities Bill”. I think, really, what this bill is about is emasculation of the rights of New Zealanders, of the ratepayers of all councils, and of councils themselves. This bill removes and deprives people of a right. That’s why it is an emasculation bill, and, in some ways, the bill should actually be called that.

My good colleague has put up an alternative title. The first part is about reflecting the number of entities. Of course, we’re going from 67 entities down to four very large, ginormous entities, driven off the back of someone sitting in Scotland saying that, in his divine view, we should have a minimum of 800,000 people, even though we’ve had some of New Zealand’s best economists dispute that, but they got set aside in a matter of minutes by the Department of Internal Affairs, the advisers to this committee. So the proposal is to call it the “Mega-Entities Bill”. There could be many alternatives to that: “ginormous”, “misaligned”—

Simeon Brown: Huge.

ANDREW BAYLY: —“huge”, but—

Tim van de Molen: Gargantuan.

ANDREW BAYLY: Oh, “gargantuan”. That’s a very good word. There are many, many titles that could reflect how we’re just squashing these into four entities, yet there’s unknown rationale for many of us as to why it is specifically four, particularly when one spans the Cook Strait.

The other aspect is, when it was introduced, we talked about three waters, and everyone knows about three waters, and I think some of the advertising talks about three waters, doesn’t it? It talks about: clean water, drinking water, waste water, and stormwater. Of course, we’ve had some changes made today about the definition of “stormwater”—

Karen Chhour: Five waters.

ANDREW BAYLY: —I think we’ve got slightly more clarification around it.

My colleague from ACT is highlighting the very point, saying there’s actually five parts to this bill. It is the “Five Waters Bill”. That, of course, reflects the addition that came in late during the select committee stage, probably driven by—I assume—ministerial intervention; certainly, I don’t think it came through the committee. I don’t recall me putting up a hand or Simon Watts putting up his hand or Anna Lorck putting up a hand or anyone putting up a hand and saying, “Gee, I think we should add geothermal and coastal.” I anticipate it probably came from ministerial input into the drafting process, and hey presto! Suddenly, we’ve got five parts to it.

I think saying there are five parts to it actually reflects the true nature of this bill. I think these last bits, particularly around geothermal—I don’t think if you asked anyone, even in Lambton Quay, let alone going to Eketāhuna and asking them, “Do you think coastal waters—what are they made up of, oh salt water, OK, all right, and geothermal, oh yeah, we drink that a lot and we swim in that a lot. Maybe.” I don’t think anyone ever thought that this bill would include geothermal and coastal waters. But holy presto! Here we are, we’ve got it.

But I actually think what we should do, I think it should be a simpler title. I think we should just call it “The Dribble Bill”, because that’s what it is; it is a piece of dribble, this bill. I think many New Zealanders are going to look back and reflect on this time and say, “Those Ministers and that Labour Government served us poorly.” We will have the opportunity to change it in time, and I hope we do, with my good colleagues—but this bill needs to be changed. It’s going to be a disservice to all New Zealanders, but particularly to New Zealand ratepayers and the 67 councils that have had their assets ripped off them.

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

NICOLA WILLIS (Deputy Leader—National): Has there ever been a bill so misleadingly named? The Water Services Entities Bill, as if nothing is going on here tonight, under urgency, in Parliament. When, in fact, what’s going on is a megamerger of ratepayer-funded assets against the will of those who currently govern those assets, squeezing them into a burgeoning bureaucracy with layers upon layers of new management and a Byzantine governance structure that takes accountability away from the people and divorces democracy from the management of these assets.

And what do they call it? What do the Labour Ministers call it? They call it the Water Services Entities Bill. Well, they should front up and be clear what this is. This is the Three Waters Confiscation Bill. That’s what it is.

What we have here is a piece of legislation that says, “Oh, look, we’ll start doing this at some time.” That’s what the commencement date says. But make no mistake, they’ve put a deadline in, New Zealand. The deadline is July 2024—that’s when they say, come whatever may, if Labour’s in power, they will be forcing your ratepayer assets into these four mega-entities. That’s why this bill cannot stand. That is why National will oppose it and why we will look forward to repealing it.

This is the kind of legislation which I think has Labour taking the New Zealand public for fools, because the arguments we’ve had in recent days, from Ministers and from members, have been that this is somehow necessary because it’s going to save money. What I want to know is: how can that possibly be the case, when what they’re planning to do is create mega-bureaucracy, more and more layers of management, and no actual accountability back to the people who we’re meant to serve?

How can that be the case, when there are ratepayers up and down the country who have paid rates for years and who are happy with the way the water services are being managed right now? And, yes, there are some of them who say, “Look, there should be some more accountability in terms of the way that we have to report on what’s happening; where people aren’t meeting standards, they should have to.” All of that’s good. None of that requires taking all of the entities that exist and shoving them into four mega-merged bureaucracy entities.

It’s not something that New Zealanders support, but it’s something that this Government seems intent on pushing ahead with. The question you have to ask is: if you’ve got New Zealanders up and down the country saying, “We don’t want this; this isn’t the way it should be done.”; if you have submitters from across the country in their tens of thousands saying, “We don’t want this; it shouldn’t be done.”, then why is it that the members opposite are so intent on pressing ahead with it, pressing ahead with it against the will of the people that they are meant to serve, pressing ahead with it against the judgment of many of those who’ve submitted, who’ve called into account the fact that this will not have the accountability mechanisms that democratic entities will have, who’ve said, “Actually, this Byzantine governance structure that you’re proposing may well not lead to the outcomes you are hoping for.”?

So here on this side of the House, we say, “What a misnamed bill.” What a frightening idea that it will ever commence. We will continue to fight against it. Labour can try urgency on us; they can try and do this sort of thing in the sneaky depths of the night, but we, National, will oppose it. And come 2023, we look forward to repealing it.

CHRIS BISHOP (National): Thank you very much, Madam Chair. This bill is misnamed. This bill is called the Water Services Entities Bill, but, as the Parliament has learnt and the country has learnt over the last 48 hours or so, it’s not three waters any more. The Water Services Entities Bill doesn’t affect the three waters. It’s actually the “five waters”, because slipped into this bill by the select committee was the extension of the bill to coastal water and geothermal water, and we are yet to hear a proper explanation from the Government about this.

The Prime Minister was asked about it and could not explain it. She basically said, “Oh, I’m not really sure that’s happening. Oh, it’s all a bit confusing. We must need to clarify that.” That seems to be a common refrain from the Prime Minister when it comes to complex matters at the moment, but we are yet to hear from the Government why the bill is no longer just three waters and why it is now actually “five waters”. Maybe at some point in the public domain—because we’re not going to get a chance in the committee stage any more—we will get an explanation from the Government before we get to the third reading in the next couple of weeks, because this is a very large extension of the powers in the Water Services Entities Bill, and so the bill is misnamed.

We actually do need to have a reference to “five waters” in the bill title, because the Government has sold it as three waters. The unfortunate thing for the Government is that three waters has literally become a synonym around the country for Government incompetence, and anger around rural and provincial New Zealand, in particular, at a Government that they see as overreaching, a Government that they see as unaccountable, and a Government that they see as taking assets off the hands of ratepayers and giving it to these unaccountable mega-entities, and now we discover that it’s not just the three waters; it’s the “five waters”.

The other thing is that we should have “co-governance” mentioned in the bill name, because that is the thing that has riled up New Zealanders. Now, I was at the Infrastructure New Zealand conference today, and Michael Wood, the Minister of Transport, was making the point, referencing Grant Robertson, the Deputy Prime Minister, that if there wasn’t co-governance in this bill, then the Crown would be tied up in court for ever. It is true to say that there are rights and interests for Māori with water. The Crown accepted that at the Supreme Court when it came to the mixed-ownership model case that the previous National Government put forward to sell down stakes in Mighty River Power and Meridian. The Crown accepted that, and that has been the longstanding position of the National Opposition. But it is not true to say that to give effect to rights and interests, that requires 50:50 co-governance.

It does not follow from saying that iwi and mana whenua have rights and interests in water that the necessary corollary is 50:50 co-governance of these entities. It just does not compute, and the thing is that the public have worked it out. The public have worked that out and, unfortunately, there is a middle path through this, but the Government will not compromise on the 50:50 co-governance proposals. There is a middle path through this that the Government could and should adept.

The other thing that should be referenced in the bill title is the extreme extent of its Mana o te Wai statements that these entities are required to give effect to, because as it transpires, only mana whenua can write Te Mana o te Wai statements—only mana whenua. Now, that has quite rightly engendered huge outrage from many people in New Zealand. That’s not to say that mana whenua do not have a legitimate role and a right and an interest in the management of water and water infrastructure, but to say that only a particular group can write Te Mana o te Wai statements, which the bill gives enormous importance to when it comes to these entities—in the National Opposition’s view, that is wrong. It’s not reflected in the bill title, and it should be.

INGRID LEARY (Labour—Taieri): I move, That the question be now put.

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

Ayes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 45

New Zealand National 33; ACT New Zealand 10, Te Paati Māori 2.

Motion agreed to.

CHAIRPERSON (Hon Jacqui Dean): The question is that Simon Watt’s amendment to clause 1 set out on Supplementary Order Paper 298 be agreed to.

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

Ayes 45

New Zealand National 33; ACT New Zealand 10. Te Paati Māori 2.

Noes 74

New Zealand Labour 64, Green Party of Aotearoa New Zealand 10.

Amendment not agreed to.

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

Ayes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 45

New Zealand National 33; ACT New Zealand 10; Te Paati Māori 2.

Clause 1 agreed to.

CHAIRPERSON (Hon Jacqui Dean): The question is that the Minister’s amendments to clause 2 set out on Supplementary Order Paper 306 be agreed to.

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

Ayes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 45

New Zealand National 33; ACT New Zealand 10; Te Paati Māori 2.

Amendments agreed to.

CHAIRPERSON (Hon Jacqui Dean): The question is that Simon Watts’ amendments to clause 2 set out on Supplementary Order Paper 303 be agreed to.

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

Ayes 45

New Zealand National 33; ACT New Zealand 10; Te Paati Māori 2.

Noes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Amendments not agreed to.

CHAIRPERSON (Hon Jacqui Dean): Simon Court’s amendments to clause 2 set out on Supplementary Order Paper 305 are ruled out of order as being contrary to a previous decision of the committee.

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

Ayes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 45

New Zealand National 33; ACT New Zealand 10; Te Paati Maori 2.

Clause 2 as amended agreed to.

Bill to be reported with amendment.

House resumed

CHAIRPERSON (Hon Jacqui Dean): Madam Speaker, the committee has considered—[Members interjecting]

ASSISTANT SPEAKER (Barbara Kuriger): Silence.

CHAIRPERSON (Hon Jacqui Dean): The committee has considered the Water Services Entities Bill and reports it with amendment. I move, That the report be adopted.

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

Ayes 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 45

New Zealand National 33; ACT New Zealand 10; Te Paati Māori 2.

Motion agreed to.

Report adopted.

Bills

Residential Tenancies (Healthy Homes Standards) Amendment Bill

First Reading

Hon Dr MEGAN WOODS (Minister of Housing): I present a legislative statement on the Residential Tenancies (Healthy Homes Standards) Amendment Bill. I move, That the Residential Tenancies (Healthy Homes Standards) Amendment Bill be now read a first time.

New Zealand and the world have faced many challenges over the last few years. COVID-19, as well as being a health emergency, has had many issues and impacts on the construction sector. The global supply chain issues have meant it’s been difficult to obtain goods from overseas, and it has caused delays in construction. Lockdowns and isolation measures have also changed spending habits and more money being spent on people’s homes, contributing to shortages of tradespeople in the construction sector.

As a result, this bill proposes an extension to the compliance timetable for both private and public landlords to meet the healthy homes standards. The healthy homes standards are minimum standards for heating, insulation, ventilation, draught stopping, moisture and grease, and drainage in our rental properties. However, some landlords have found it difficult to meet the standards in the current compliance time frames due to factors beyond their control. The original compliance time frames were set in 2019, well before anyone could have imagined what was around the corner and the disruptions that would occur on a global and on a local scale. The extension gives private and public landlords the opportunity to comply without being at risk of breaching their obligations and breaking the law. This is a pragmatic and sensible response to a set of circumstances that were beyond the control of many of the people.

Previously, all Kāinga Ora and community housing provider (CHP) houses were required to have all the properties complying with the healthy homes standards by July 2023. Private landlords had an additional year on this, until 1 July 2024. The changes that we’re introducing today mean that Kāinga Ora and CHPs will now need to comply by July 2024 and private landlords will keep that additional year that was in the original timetable and now have a compliance date of July 2025.

Kāinga Ora, community housing providers, and private landlords are in similar boats. If we have a look at what Kāinga Ora has achieved to date in terms of the insulation and upgrade to the healthy homes standards of its housing stock, 84 percent of Kāinga Ora tenanted housing stock is meeting the standards or is being upgraded right now—those upgrades are already under way. We have scaled up the work that is being done, and we are now completing 600 homes a week in terms of the upgrade.

I think if we have a look at what the private sector has managed to achieve, if we look at the survey data, the most recent survey data—noting that we have another survey in the field that closes this month and that data will be reported back in January to Government—the best estimate is that we have around 84 percent of private landlords who have met their compliance targets. This suggests to me that 84-85 percent is probably about the capacity of the market at the moment.

If we have a look at the CHP sector, some of our community housing providers are really struggling. There are CHPs who are less than 50 percent compliant and haven’t been able to access the supply chain that Kāinga Ora has. This is a necessary and pragmatic response that we need to do.

We’ve heard and we’ve listened to those both in the community housing sector to private landlords and to Kāinga Ora. One community housing provider has said, “COVID-19 has had direct and significant impact on the delivery of our healthy homes standard programme, which could not have been anticipated when the regulations were first put into place.” I don’t think any of us can argue with that. Regulations and time lines that were instituted in 2019 simply did not know what was coming. However, as a Government we consider this incredibly important work. The fact that we do have homes that are healthy for people to live in, homes that will not make people sick, homes that are of a standard that we expect New Zealanders to have a right to live in, that is why as a Government we made it a priority. I think it is a shame that it had to wait until 2017 and a change of Government until this kind of work got under way, but it was one of our priorities when we came into Government, and despite these extensions this remains a priority.

I’ve made it clear to Kāinga Ora that my expectations are not that this extension of the time frame should mean that they take the foot off the pedal at all, that 600 homes a week being completed to the standards is a good number and probably at about capacity, and I want to see that. In reality, I think Kāinga Ora will probably reach somewhere close to 95 percent of compliance by 1 July 2023, the date that it had. It is making up lost time for the constraints, and it is fitting it into its wider build programme, which itself has scaled up considerably in the last 12 months, to a point where we are the Government that is producing the most public houses of any Government since the 1970s.

This is a State house build of a generation. I think it is cause to reflect that of the 10,000 new places that we’ve added while we’ve been in Government. You add that to the 60,000 - odd that were there when we came in—you can see the scale of what this Government has done to the housing stock. But it’s not only quantity; it’s also the quality of the existing stock that remains important to us.

So this bill that we have being introduced tonight amends the Residential Tenancies Act of 1986 as well as the Residential Tenancies (Healthy Homes Standards) Regulations of 2019. The final compliance date is in the Act, while the regulations set out the time frames for each type of tenancy. We are debating this bill under urgency so that all landlords can have certainty and clarity on their new time frames as soon as possible. One of the things I heard very clearly, particularly from private landlords, was they wanted to have this legislative change made so that they were crystal clear on what their new time frames were. The bill has a commencement date of 26 November 2022, which is estimated to be the day after the date of Royal assent. We want to introduce these changes as soon as possible to ensure that landlords can use the extension if they need it. So for any private tenancy that started or renewed on or after 28 August 2022, the landlord will now have 120 days to comply with the healthy homes standards.

The bill also makes consequential amendments to the Residential Tenancies (Smoke Alarms and Insulation) Regulations of 2016, and these regulations set out the insulation requirements that do not apply once the tenancy is required to meet the insulation standard in the healthy homes standards. Once all tenancies are required to meet the healthy homes standards, the insulation requirements in these regulations will be revoked. The consequential amendments line up the dates with the new time frames that are contained in the bill.

I think it’s important to note that these extensions do not apply to landlords who have simply missed their obligations under the Act as it currently stands, so that if a tenancy has changed in that time frame and a landlord has failed to comply, then they will not have the benefit of this extension.

The Government is responding to an extraordinary and unprecedented set of disruptions brought about by a global pandemic over the past two years. It has been felt by public landlords and it has been felt by private landlords. This extension gives landlords the opportunity to comply without being at risk of breaching their obligations due to issues outside of their control. It improves regulatory certainty. This amendment shows the Government is willing to be flexible and pragmatic, and I commend this bill to the House.

ASSISTANT SPEAKER (Hon Jacqui Dean): The question is that the motion be agreed to.

CHRIS BISHOP (National): Thank you very much, Madam Speaker. The National Opposition will be supporting this bill, the Residential Tenancies (Healthy Homes Standards) Amendment Bill, through its very swift and expeditious parliamentary passage, probably this evening. We think it is a sensible approach, and we welcome the extra flexibility for private landlords—and, indeed, the Government’s landlord, Kāinga Ora—to meet their obligations.

I do want to make a few remarks about this issue and some of the things the Minister, the Hon Megan Woods, just said. The first is that she started her speech by saying some landlords have been unable to meet their obligations under the residential tenancies healthy homes standards. And, of course, “some landlords” is an interesting phrase, an interesting terminological phrase, because, actually, this bill is all about Kāinga Ora, the Government’s landlord. As the Minister herself says, the latest survey shows 84 percent of private sector landlords—

Hon Dr Megan Woods: 85.

CHRIS BISHOP: 85, sorry—85 percent of private landlords are in compliance with the standards. Now, the latest figures for Kāinga Ora, the figures that I’ve got to 30 September—so, what’s that, six, 6½, seven weeks ago?—show that there is only 64 percent of Kāinga Ora homes in compliance with the standards. That’s 23,000 homes. So there is a big disparity there. Word got around last Thursday/Friday that this was coming—another leak out of the Government; a leaky Government—and the word on the street is that this was just an extension for Kāinga Ora, for the Government landlord to make good on its obligations and be compliant—

Hon Dr Megan Woods: Sources aren’t very good, then, are they?

CHRIS BISHOP: Sources aren’t very good? Well, they’re usually pretty good.

Hon Dr Megan Woods: Not this time. You’re completely wrong.

CHRIS BISHOP: OK—OK. That’s an interesting thing, OK.

Simeon Brown: The Beehive needs a leak test.

CHRIS BISHOP: The Beehive needs a leak test!

Simeon Brown: That’s why they’re doing all the scaffolding!

CHRIS BISHOP: Ha, ha! It leaks like a sieve. Anyway, we know what this bill is about. This bill is not so much about private sector landlords—

Hon Dr Megan Woods: Leaks like MFAT under Murray McCully.

CHRIS BISHOP: Yes, yes. Well, all Governments have leak issues, but this Government is leakier than most. So we know what this bill is about; it’s about Kāinga Ora. And the extension to all landlords is a fig leaf for the fact that the Government has not been able to bring Kāinga Ora tenancies into line with the standards.

You do have to wonder—COVID is to blame according to the Minister, and there’s no doubt there is some truth to that, but how long and for how many issues is COVID going to be to blame? I make a prediction now: we’re going to get through to election 2023, in September, October, November—whenever it is; whenever the Prime Minister deigns to set the date—and the Government will spend a lot of next year blaming COVID for things. We’re debating this bill tonight in relation to the healthy homes standards. It seems to be the cause of inflation worldwide, and indeed in New Zealand, and many other issues are going to be blamed on COVID. The Government seems to have two responses when it comes to issues that they’ve done a bad job dealing with: one is to blame the National Party, which sort of works for a while, I suppose—sort of worked OK for the first term—but, as one commentator said the other day, the statute of limitations on blaming the National Party has expired. It’s certainly expired after five years, and I’ll tell you for free that it certainly will have expired after six years.

Ingrid Leary: Nine years of neglect. Nine long years.

CHRIS BISHOP: “Nine long years”—see, there we go again! It’s still there—it’s still there. The “Nine long years” refrain sort of worked when you were coming into Government. It’s a bit less effective when you’ve had five, and next year it will be six, years to sort out problems. But, you know, do continue to talk about it; I don’t think it’s working that well for you, but do keep saying it.

So, firstly, they normally blame National, and then they blame COVID, and, at some point, the Government has to front up and take some responsibility. So here we are on a Wednesday evening, passing this bill through all stages, alongside 20 other bills, to extend the deadline for Kāinga Ora to 1 July 2024, which is an extra year—currently, it’s meant to be 1 July 2023—and, for private landlords, out to 2025. Of course, any new or renewed tenancy has to be compliant straight away.

So we’ll support this; it’s sensible legislation, but New Zealanders should be under no illusions about what has prompted this: the extension for all landlords is a cover—it’s a front—for the fact that Kāinga Ora has been unable to move quickly enough to bring their tenancies up to scratch, and as at six or so weeks ago we’ve got 23,000 tenancies that are not in compliance. I think I heard the Minister say they’re doing about 600 a week. And she says—this is interesting; it’s an interesting prediction. We’ll wait and see if this is true or not. I think I heard her say that she thinks that Kāinga Ora will be 95 percent compliant by 1 July next year.

Hon Dr Megan Woods: About.

CHRIS BISHOP: About—about. Yes, OK, a bit of wriggle room there.

Andrew Bayly: We don’t set targets!

CHRIS BISHOP: We are going to go through a committee stage. I could move an amendment to put some sort of target into the bill, but I probably won’t bother. But I wonder what “about” means. Is 90 percent “about”? I suppose it is. But it is still 5 percent. So that’s a few hundred homes. But, anyway, we’ll wait and see where we get to on that, and no doubt we’ll come back in July next year and see how we’re going. So we support this, but Kiwis need to know exactly what has prompted it. Thank you, Madam Speaker.

CHLÖE SWARBRICK (Green—Auckland Central): E te Māngai, tēnā koe, tēnā koutou e te Whare. Fascinating—given the amount of interest that there appears to be in this legislation—that we seem to be collapsing the debate this evening. I find it fascinating to hear that there is kind of consensus amongst the two larger parties in this Parliament, and perhaps this speaks somewhat to the intention of, or the philosophy behind, the legislation that we are debating tonight.

We don’t live in a game of Monopoly. By the way, the game of Monopoly, the board game, was invented exactly to explain or to illustrate the pitfalls and the dangers of an economy that is premised on property speculation. It was a game made for children to illustrate exactly this point of such a problematic version of thinking about the economy. And we don’t live in a game of Monopoly. We can—and should—change the rules when the rules are not working for us. That’s the point of living in a society; we live by the social contract, and the social contract can, and indeed, should, evolve when the rules need updating. That’s supposed to be the role of this place, of our Parliament. The rules do not work, and when it comes to the healthy homes standards and immense amounts of discussions with renters who have come forward to me, in my constituency office—Auckland Central happens to be the electorate in this country with the highest proportion of renters and the highest proportion of rental transience—that is, renters living in their properties for less than a year at a time.

We are hearing that the healthy homes standards are not working. The Greens supported them in their introduction in 2017 and 2018 because they were far better than the status quo, but we made the point at the time that they did not go far enough. And, in fact, at the beginning of this year, in parliamentary written questions, the Associate Minister of Housing—then, the Hon Poto Williams—showed that one of the many issues with the healthy homes standards, as they currently operate, is not the fact that landlords don’t have enough time to comply, as this legislation seeks to create that extension for; but the fact that the Government does not collect data on that compliance. That’s despite the fact that every new tenancy needs to have the tenancy contract put on the Ministry of Business, Innovation and Employment website through Tenancy Services—and I’ve asked a number of questions about whether it’s that they need their computers upgraded to simply be able to read those documents and to check for that compliance. But it is the fact that the Government at present does not know how many private rentals are up to scratch when it comes to the healthy homes standards. But worse than that, it doesn’t know how many companies are holding themselves out as capable of verifying compliance with healthy homes standards, and it also doesn’t know how many landlords or property managers are self-verifying their exclusion from the healthy homes standards.

So when we talk about the rules not working and we talk about listening in this Chamber tonight, I do feel aggrieved, and the Greens do feel, actually quite understandably, frustrated by the fact that when the Government’s talking about listening and when it’s pinpointing—through the regulatory impact statement as prepared by officials—that those who it is listening to are those who have always disproportionately held the power in terms of our rental market. Because despite the fact that the regulatory impact statement pinpoints very, very clearly that those who will be disproportionately impacted—or rather, actually, those who will be primarily affected by this proposal, and this is on the regulatory impact statement page 2—are those who rent homes that are not yet compliant with standards because the healthy homes compliance date has not passed. The regulatory impact statement makes it incredibly clear, and I quote from it here, that “the negative effects will disproportionately impact vulnerable populations of tenants who already experience inequitable health outcomes.” You would have thought, when the Government talks about listening, that those who are identified as being primarily impacted by the legislation that it is passing under urgency tonight would have been those who the Government listened to. But, no, if you turn over the page to page 9 on the regulatory impact statement, you’ll find, in fact, that the stakeholders who the Government approached were, in fact, property managers, landlords, and Kāinga Ora. Renters, Renters United—rental organisations were not approached and were not engaged, and I’m really looking forward to the committee of the whole House stage to dig into this because it appears as though Government’s not particularly—and rather, the Opposition is not particularly interested in holding the Government to account on this one, and just passing it on through.

Andrew Bayly: You go for it. Go for it, Chlöe!

CHLÖE SWARBRICK: But what we have here is a Government saying that it’s listening, but listening only to those who are benefiting from the status quo. So I also think that when we’re going to talk about compliance and the amount of lead time that has been available—there has been five years to get up to scratch, Andrew Bayly, with the healthy homes standards, and at the last hurdle, the Government is deciding to restart the clock and provide yet another year. And this brings us back to that really key issue with data—which, again, was identified in the regulatory impact statement. Many of these issues with a lack of data and a lack of evidence could be resolved, by the way, with a warrant of fitness that would reverse the burden of proof instead of it continually falling once again on tenants to prove that their homes are not up to scratch—

Andrew Bayly: It’s David Parker’s fault!

CHLÖE SWARBRICK: —to take them through the likes of the Tenancy Tribunal—which I should say, Andrew Bayly, many landlords also report that they do not feel works particularly well for them. So what’s the Government doing in the absence of having that data? It’s polling. And it’s polling, and it’s using, as we can see, reflected here specifically in the regulatory impact statement—page 9, for those who are interested. The data that it’s using to base this decision on and this policy to extend the time frame for compliance to the healthy home standards is not statistically significant. I don’t know how the Government can stand up and say that it is listening and that it is doing the right thing here when it continues to side with those who are profiting from the status quo.

I also, just finally, want to turn to the departmental disclosure statement, where fascinatingly enough—and I can’t find it in front of me—what the departmental disclosure statement makes really clear is that at part 3.1: “what steps have been taken to determine the policy to be given effect by this Bill is consistent with New Zealand’s international obligations?”—well, it turns out that the Ministry for Housing and Urban Development considered the bill’s consistency with New Zealand’s obligations under Article 11.1 of the International Covenant on Economic, Social and Cultural Rights. For those following along at home, that is, of course, our international commitment to housing, but more than that, adequate housing is a human right. And somehow, we have here, reflected in the departmental disclosure statement—in black and white—that these proposals are consistent with the obligations of housing; adequate housing as a human right. This legislation, which extends the ability for landlords to comply with the healthy homes standards—housing being warm, dry, safe, and healthy—is somehow consistent with our commitment internationally to treating or, rather, giving effect to the human right to adequate housing.

I’m really looking forward to continuing to canvass this debate and these discussions in the committee of the whole House, because I think that we’ve only just begun to scratch the surface. Again, I’m really gutted by the fact that we’re not having a fulsome debate, as I would hope that all parties in this place would be interested in, the many 1.5 million New Zealanders who live in rental properties—living in healthy homes—but, unfortunately, it appears as though the Opposition is far too keen to get home. The Greens, of course, will be opposing this legislation.

BROOKE VAN VELDEN (Deputy Leader—ACT): Thank you, Madam Speaker. I rise on behalf of the ACT Party in the first reading of the Residential Tenancies (Healthy Homes Standards) Amendment Bill.

You know, every day in this House, we hear an argument from the Government about why they can do a better job at providing services to New Zealanders than other New Zealanders can to each other. We hear it time and time again. We hear the need for the Government to take taxes, to take people’s money so that they can provide a service that nobody else can—it will be so much better!—because they believe that they can spend our money better than we can spend it ourselves. And you see this sloshing around the economy with wasteful spending, but specifically with housing—when we know that there’s been a housing crisis. We’ve seen the Government say, “Don’t worry, we can do it better than the private sector.” And how did KiwiBuild turn out? An absolute tragedy; billions of dollars being wasted in our economy, but, specifically, in housing. We’ve been promised houses that the Government just couldn’t deliver.

Now, when it comes to the healthy homes standards that they passed a few years ago, they said, “Don’t worry, we can bring all of the houses around New Zealand, all of the rental accommodation, up to what we consider to be a healthy homes standard.” They gave one rule for landlords and one rule for the Government. But it turns out, even with a two-year extension on top of what private landlords were given, that the Government couldn’t even do an adequate job, let alone a good job or a better job. We know they’ve done a worse job, but they couldn’t even do an adequate job. We know from some statistics that 85 percent of landlords had either brought their home up to healthy homes standards or had actions to do so last year. This year, the Government has only brought up and has the plans for healthy homes standards compliant houses for 84 percent. So they’re one year behind on what private landlords had already done. So the Government, with our money, with our taxpayer funds, and with the size of themselves as an entity, have not been able to do what private landlords across New Zealand have done.

Knowing this, they’ve decided to come back into this House and pass an extension for themselves so that they have more time. And the remarkable thing is that we’ve heard from the Minister, the Hon Dr Megan Woods, that this is for all landlords, because they’ve been listening that there are problems across the sector because COVID-19 got in the way. But where was the Government listening last year? They are passing this law for themselves, so that Kāinga Ora has an extension for themselves to bring up their homes to the healthy homes standards, not because they’ve listened to private landlords and have decided to give compassion to people who are trying to do the right thing to bring up their homes to the healthy homes standards; it’s because of themselves.

The reason that we know this is because last year I was standing in this very Chamber, advocating that private landlords who were struggling to bring their homes up to the healthy homes standards should be given an extension. And the reason was because there were, at the time, a lot of landlords, specifically in Auckland, who were struggling to make their homes compliant because Auckland was in the middle of a massive lockdown and there was no possible way that they could get tradespeople in and out of their residential accommodation, because we had people living in bubbles. You know, tradespeople couldn’t just enter a flat or a rental home, because they needed the approval of people living in that accommodation. So there were very, very stressed landlords saying, “We need an extension so that we can follow the law.” And what did the Government say? It turned around and pretty much said, “Tough luck. If you’re not compliant, we don’t care. You will break the law.” They said, “It’s OK, maybe the Tenancy Tribunal will just turn the other way and just not even say that people are or aren’t breaking the law. Just don’t worry, the Tenancy Tribunal will just look the other way.”

And when we asked what advice they have had on whether they could give an extension to landlords, a year ago, the Minister said, “I don’t think it’s in the public’s interest to release that information.” Then, when we pressed even further, they said, and I’ve got a quote here: “The advice was that it would not be possible to extend compliance deadlines in a way that assists the vast majority of landlords, and including those whose compliance deadlines have already passed.” So a year ago, when landlords up and down New Zealand were saying, “We have tried our very, very best, but we can’t comply”, the Government said, “Tough luck. We don’t care.” And, now, they’re in this Chamber saying, “We have listened to landlords. We know that they can’t meet the standards. We are going to give them an extension. Aren’t we compassionate?” But, in reality, it’s only because they know they can’t meet the standards that they expect of everyone else.

So the question to the Minister, really, is: why do they have such a high standard for everybody else, but a different one for themselves? Where is the fairness? You know, landlords, knowing that they’ve needed to comply, to do the right thing, to bring their homes up to healthy homes standards, have forked out thousands of dollars, tens of thousands of dollars, knowing that they need to do the right thing to provide that warm, safe, dry home to their tenants. But the Government have the most vulnerable of tenants and they couldn’t do it for those tenants, and she needs to explain why. Why is it that only when they’re getting close to the deadline have they thought about ramping up the efforts to meet their own rules, rather than doing what all other private citizens who are landlords in this country have been doing, which is getting everything up to scratch before they become non-compliant?

The ACT Party, overall, doesn’t agree that we should have these healthy homes standards, because, over time, we want to see more investment, development, and growth in our housing market so that we can have more, newer stock coming on to market that is of a higher quality. And, over time, as we have more growth and development and more homes on the market and more residential accommodation, that would allow for more affordable housing for all New Zealanders. In the meantime, what we’ve ended up with is a Government that’s been fixated on rules and regulations and taxes, and all it’s done is impose huge costs on private landlords who have been trying to put their homes up to a healthy homes standard, some of them forking out tens of thousands of dollars, and that cost is needed to go on to tenants. There are flow-on effects from all of these taxes and regulations.

But the real problem with the housing crisis is that we just don’t have the right rules underpinning us so that we can get more residential accommodation in general. We want to see more development in infrastructure and infrastructure financing and funding so we can actually get to the heart of the problem of why we don’t have enough homes for people to live in and why we don’t have more accommodation that is warmer, drier, and safer for people to live in.

This is just nanny State from the Government, wanting to impose more costs on people wanting to do the right thing, but, in the meantime, having a very, very high standard for other people and a very low standard for themselves, when they believe that they know best and they can do better. It’s not acceptable and New Zealanders deserve better. They should say, straight up, that they wanted to pass this law because they need an exemption for themselves, not trying to say that it was because of anybody else, or private landlords who couldn’t do it, when we know that they were in this Chamber a year ago saying the vast majority of private landlords already comply, and the other ones who can’t—well, tough luck.

Dr EMILY HENDERSON (Labour—Whangārei): Kia ora e te Māngai o te Whare. This is a very important process that we have, with the healthy homes standards. This is a pragmatic response to an international global situation. I commend it to the House.

Dr LIZ CRAIG (Labour): Thank you, Madam Speaker. All of us have been impacted by COVID-19 in different ways, and I think it’s no different for landlords trying to comply with the healthy homes standards. This is an important bill because what it makes sure is that we do end up complying with all rental homes by 1 July 2025, but it also takes into account supply chain reductions. It also takes into account difficulties getting heat pumps into the country, and workforce shortages. I commend this bill to the House.

ASSISTANT SPEAKER (Hon Jacqui Dean): Making a remote contribution and a five-minute call, I call Rawiri Waititi.

RAWIRI WAITITI (Co-Leader—Te Paati Māori) (remote): Tēnā koe e te Pīka, otirā tēnā tātou e te Whare. First of all, I want to acknowledge the House for supporting our ability to be able to participate remotely; this is not new to us, but Te Paati Māori want to express our thanks and appreciation for allowing us to do this.

I take this call on behalf of Te Paati Māori to speak to the Residential Tenancies (Healthy Homes Standards) Amendment Bill that is being passed under urgency. This is a terrible bill. No wonder Labour is moving this amendment, because it relieves Kāinga Ora—who house the most vulnerable people, predominantly Māori—of their obligation to get their homes up to a healthy standard for their tenants. I’m not surprised that National support the terrible bill, because many of their supporters and members are the majority of homeowners here in Aotearoa.

I do support the member for the Greens Chlöe Swarbrick and the very valid contribution and arguments pointed out by her in regards to the desired outcomes the Government want in this bill. Dare I say it, I also agree with some of the sentiments expressed by the ACT Party.

But this is a terrible bill, e hika mā. It is being passed only to let landlords off the hook by giving them an extra year to comply with the healthy homes standard. What’s more, it’s being passed through all stages under urgency—within a week. This is absolutely dangerous and reckless lawmaking. This shocking lack of process is a real threat to our people; it is a threat to democracy.

That threat is clear when we look at this bill. The justification given for the year-long delay is a total cop-out. The reality is that the healthy homes Act was passed in 2017 with the regulations laying out minimum standards to comply and time frames released in 2019. These regulations already provided a lengthy period to allow landlords to comply with the final date set as 1 July 2024—a full five years to enable compliance.

However, this bill extends that to 1 July 2025. These changes speak to the double standards that the State applies to those with power and wealth who don’t comply with the law, and those without, as tangata whenua know too well. These double standards are racist, classist, and are born out of a colonial mind-set. We will not stand for it.

Our tangata whenua landlords complying with these healthy homes standards couldn’t be more important. We know that more than 50 percent of Māori are renters. We know that 30,000 tamariki are hospitalised each year from our unhealthy homes. We know that 33 percent of Māori will shift residencies every three years. Our people can’t afford these delays. Cold, damp, and run-down houses are literally killing our people. Māori are often having to deal with supposedly Third World conditions, like rheumatic fever, due to the disgusting state of the rental market in this country. Rather than further weakening protections with this bill, Government should be strengthening the standards, which were watered down through lobbying from the property class.

We strongly and wholeheartedly oppose this legislation and call on this Government to withdraw and to do what’s right for renters in Aotearoa. Te Paati Māori will be wholeheartedly voting against this bill. Nō reira, kia ora tātou katoa.

VANUSHI WALTERS (Labour—Upper Harbour): Thank you, Madam Speaker. It’s a pleasure to take a brief call in support of the Residential Tenancies (Healthy Homes Standards) Amendment Bill. The Minister has already spoken comprehensively about the need for this bill, which does centre around being realistic about how we manage the supply chain impacts of COVID-19. We do believe it’s very important that people are able to access warm, dry homes, and significant change and development is already happening, including in the private sector, where data suggests that around 85 percent of private landlords are either already compliant or taking action to become compliant. Kāinga Ora has also made good progress, with around 84 percent of Kāinga Ora’s tenanted housing stock meeting the standards or being upgraded right now. I commend this bill to the House.

MAUREEN PUGH (National): Thank you, Madam Speaker. I rise to take a very short call on this bill. We understand that this is the Government abdicating its responsibility to meet its own deadline, but we do support the fact that landlords have been given an extension of time. We support this bill and I commend it to the House.

INGRID LEARY (Labour—Taieri): It’s quite difficult to sit here and listen to members around the House talk about failure to deliver, when Labour is the only party that has bothered to put in healthy home standards, because we understand the link between health and the quality of housing. What’s happened has been COVID—there have been disruptions to the supply chains. It would be inherently unfair to expect landlords who cannot get heat pumps or construction supplies to comply with regulations when they are actually not able to do it. This is a pragmatic solution, it’s a fair solution, and I commend the bill to the House.

ASSISTANT SPEAKER (Hon Jacqui Dean): The question is that the motion be agreed to.

David Seymour: Madam Speaker, Point of order.

ASSISTANT SPEAKER (Hon Jacqui Dean): I’ve started putting the motion.

David Seymour: Point of order.

ASSISTANT SPEAKER (Hon Jacqui Dean): The member will resume his seat. I have started putting the motion.

David Seymour: Well, I raised a point of order, Madam Speaker.

ASSISTANT SPEAKER (Hon Jacqui Dean): The member will resume his seat. I have started putting the motion.

Brooke van Velden: Point of order.

ASSISTANT SPEAKER (Hon Jacqui Dean): The member will resume her seat. I have started putting the motion. The question is that the motion be agreed to.

A party vote was called for on the question, That the Residential Tenancies (Healthy Homes Standards) Amendment Bill be now read a first time.

Ayes 107

New Zealand Labour 64; New Zealand National 33; ACT New Zealand 10.

Noes 12

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

A party vote was called for on the question, That the Residential Tenancies (Healthy Homes Standards) Amendment Bill be now read a second time.

Ayes 107

New Zealand Labour 64; New Zealand National 33; ACT New Zealand 10.

Noes 12

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

Motion agreed to.

Motion agreed to.

Bill read a first time.

DAVID SEYMOUR (Leader—ACT): Point of order. Madam Speaker, I think it was very clear that I was seeking a call. You had the option of actually encouraging and allowing debate on a motion. Instead, you didn’t even look to see if anyone was seeking a call, immediately moved to say you were putting a motion, and then—

ASSISTANT SPEAKER (Hon Jacqui Dean): Yep, thank you very much. Thank you.

David Seymour: No, no. Hang on a minute—

ASSISTANT SPEAKER (Hon Jacqui Dean): No, no. No. I do understand what the member is saying. I had commenced voting, and once that happens, I need to continue.

BROOKE VAN VELDEN (Deputy Leader—ACT): Point of order.

ASSISTANT SPEAKER (Hon Jacqui Dean): As long as it’s a new point of order.

BROOKE VAN VELDEN: Madam Speaker, until the end of the sentence of the voting motion has taken place, the vote hasn’t actually started.

ASSISTANT SPEAKER (Hon Jacqui Dean): Yes, thank you very much. The member won’t dispute my ruling. My ruling was final.

David Seymour: Point of order.

ASSISTANT SPEAKER (Hon Jacqui Dean): And furthermore—just before the member wants to continue to re-litigate this issue, I will rule it out of order. So I’m warning both members that the matter is closed, I have ruled, and we will be moving on.

DAVID SEYMOUR (Leader—ACT): Point of order.

ASSISTANT SPEAKER (Hon Jacqui Dean): Is it a new point of order?

DAVID SEYMOUR: Yes, indeed, Madam Speaker. You seem to be under the impression that the point of order is about whether you are able to—

ASSISTANT SPEAKER (Hon Jacqui Dean): No. The member will resume his seat. I have ruled and we are moving on. And I will warn the member that if he continues to contest and question my ruling, I will have to take the matter further.

DAVID SEYMOUR (Leader—ACT): Point of order. Madam Speaker, I want to be perfectly clear that this is a different point of order.

ASSISTANT SPEAKER (Hon Jacqui Dean): Good.

DAVID SEYMOUR: The point of order does not relate—and I want to be perfectly clear: does not relate—to whether or not you are able to take a point of order after you have begun putting a motion. The point of order relates to whether you sought to check if anyone was seeking a call, and, second to that, whether it is consistent with actually encouraging debate and upholding the rights of members to debate a motion, not to do so. And I would ask you that if there are speaking slots remaining, and if somebody is seeking a call, then you actually make an effort to look up and see if anyone is seeking a call, so that people can come to this House and do their job, which is to debate the motions on the table.

ASSISTANT SPEAKER (Hon Jacqui Dean): OK. Thank you very much for that. Thank you, you make some good points. At this point, we have moved on from the first reading. But as the member knows, we have a long road to go in this urgency motion. So I take note of your point of order, and thank you for raising it.

Second Reading

Hon Dr MEGAN WOODS (Minister of Housing): I move, That the Residential Tenancies (Healthy Homes Standards) Amendment Bill be now read a second time.

In this second reading speech, I will just give a relatively quick call. A number of questions have been raised by members in this House, many of them that need to be addressed, but I will address those in the committee of the whole House stage.

Sometimes, this House does have to be pragmatic. Sometimes, this House does have to look at a compliance issue and say, “Are there issues beyond the control of individuals that mean that we risk having laws that put people in the position of breaking the law?”

Now, we’d all like to see all our houses compliant. I don’t think there is anybody who is voting in favour of this extension that wants to see houses non-compliant, and people’s homes non-compliant with this. But what we do have to do with our lawmaking is make sure we are not setting up situations where we are knowingly putting people in the position of breaking the law.

Having warm, safe, and dry homes for people is at the core of what we as a Labour Government put at the heart of our wellbeing. We know that from warm, dry, and safe houses, all the other wellbeings flow—whether that be community connectedness, whether that be employment, whether that be health, all the other things that are absolutely at the core of our mission.

But we also know that we have had severe constraints on our supply chains and our ability to access people’s homes since the period when these regulations were put into place in 2019. There are still many tenants, particularly in the community housing sector and for Kāinga Ora, who have some reticence about tradespeople entering their home. So it may not be just for the ability to actually access the home that they cannot apply. As a landlord of some of the most vulnerable people in this country, we need to work through those issues, with some sensitivity. There are still a number of people who are quite frightened, particularly elderly people, about strangers who they do not know entering their home and risk being exposed to COVID-19. That is not something that I am willing to force on our tenants when we have options in front of us.

Before we get too excited that this means that all of our homes are not warm, dry, and safe, I think we just need to pause, reflect, and think about what we have achieved. When we passed these regulations in 2019, we did not have a requirement for any homes to be compliant. We now, in our Kāinga Ora stock, have 68 percent of our homes fully compliant, with the remainder—just to let Mr Bishop know how we get to the 84 percent—that takes us to the 84 percent currently have the work under way. They’re not in planning. They’re not in the pipeline. There are tradespeople in those homes getting those homes up to standard now. That is a vast improvement if we think, during a period where we faced a global pandemic, that we have been able to achieve those kind of levels.

I want to congratulate the private landlords that have been able to make gains. But to say that private landlords have outstripped Kāinga Ora simply isn’t true. If you have a look at the regulatory impact statement, you’ll actually see the reverse of those numbers—that, actually, it’s around 15 percent, on that Kantar survey, of private landlords that were compliant, with 70 percent who had made moves to become compliant but were not fully compliant. But, I think, if we look at the numbers in a really pragmatic way, what we can see is, probably, 85 percent of the targets we set, before a global pandemic affected supply chains and labour markets, is about the capacity of the market at the moment.

That is why we are making these changes. They are adding a year to everybody and to give everyone time for them to come up to standard. But of course it is our wish that people do this as quickly as they can.

ASSISTANT SPEAKER (Hon Jacqui Dean): The question is that the motion be agreed to.

CHRIS BISHOP (National): Thank you very—

David Seymour: Point of order, Madam Speaker. Madam Speaker, you ruled in the last reading that once you had said “The question is that the motion be agreed to.”, no speech could begin. Now, you and I both know, of course, that Speaker’s ruling 65/5 says that, actually, until you finish those words, somebody can seek a call. And I just wonder if you could explain for the benefit of the people watching at home which set of rules you are enforcing tonight. Is it the ones in the book or the ones you made up?

ASSISTANT SPEAKER (Hon Jacqui Dean): Thank you to the member. I will not have a reflection on my ruling. The member will stand, withdraw, and apologise.

David Seymour: Ha, ha! I withdraw and apologise. Point of Order, Madam Speaker. We would still like you to answer the question.

ASSISTANT SPEAKER (Hon Jacqui Dean): Yeah, well, David Seymour, I’m just going to warn you that I’m trying to be very tolerant. It’s getting on. We only have two hours and 10 minutes to go this evening, so we’ve still got a wee way to go. I am now commencing the second reading—or the House is commencing the second reading of this bill. It is my—

David Seymour: Under which rules?

ASSISTANT SPEAKER (Hon Jacqui Dean): The member will not interrupt while I am ruling. I am now going to proceed on the basis of an orderly second reading, which indicates that I will call Chris Bishop, which I now do.

CHRIS BISHOP: Thank you very much, Madam Speaker. Bit of fun and games at close to five to 10 on a Wednesday night under urgency. It’s the cabin fever that sets in at this time of year with just two weeks—

Hon Dr Megan Woods: It’s only Wednesday.

CHRIS BISHOP: What’s that?

Hon Dr Megan Woods: It’s only Wednesday.

CHRIS BISHOP: Yeah, I know. We’ve still got a long way—what did I say? Thursday? OK, I meant Wednesday. Wishful thinking! We’ve still got a long way to go. I think we’re on bill three of the 24 in the urgency motion. I could be slightly wrong on that, but we could still be here till Friday.

So this is an embarrassing bill for the Government to have to bring through the Parliament, and we’re going to help the Government out by expediting its passage through the Parliament. But let’s be under no illusions that this should be a source of embarrassment for the Government, because this bill could have come into the Parliament at any time in the last six to nine months. Currently, the latest figures we’ve got at 30 September—so 1 October; round it up—around two-thirds of Kāinga Ora tenancies are compliant with the healthy home standard. We’ve still got 23,000 or 20-odd thousand still to go. So at any stage in the last six to nine or maybe 12 months, the Government could have come down to Parliament and said, “Look, COVID’s been a problem. We’re not going to make it or it’s highly unlikely we’re going to make it. We need more time. And in the interests of fairness, we’re going to give everyone more time—the CHP sector. We’re going to give Kāinga Ora more time, and we’re going to give the private sector landlords more time.” And I think a lot of people would have welcomed that and said, “OK, fair enough. COVID’s been a tricky beast for everybody to deal with.”

And I take the Minister’s point around some of our more elderly and vulnerable people who don’t like having people who they don’t know in their homes. And many MPs in this Parliament who have dealt with Kāinga Ora residents in their electorates or areas they look after will be familiar with that issue. And I acknowledge that that is a real problem, and there is a degree of sensitivity and compassion that’s required there. And oftentimes it is the job of the MP to work through that with local tenants.

So if the Government had turned up six to nine months ago and said, “We’ve got a bit of an issue here. Look, let’s just put a bill into the House to give a bit of certainty and extend that time frame.”, I think many people would have welcomed that. But they didn’t do that. Instead, we’ve spent our time in the Parliament dealing with all sorts of other issues—many of them rinky-dink issues, not so important. And instead, here we are at the fag-end of the year, coming towards Christmas, on a Wednesday night, looking at an extension for every—

Brooke van Velden: It’s November. I’ve never heard that phrase.

David Seymour: What sense of the word was the member using?

CHRIS BISHOP: We’re right at the end of November. We’re in the third to last week of the sitting period for the year.

David Seymour: Is that the definition?

CHRIS BISHOP: Yeah, that’s right. Yeah, absolutely. We’re at the tail end of the year, and instead we have the Parliament put into urgency for the Government to embarrassingly extend the time frame.

And we know why we’re here. The Government can sort of talk about extra flexibility and all the rest of it, but we know why we’re here. We’re here because Kāinga Ora has failed in its task and its obligations. And as Chlöe Swarbrick actually said in her contribution that I listened to as I ducked out of the House—but I heard her dulcet tones ringing through the loud speaker system here in the Parliament. As Chlöe Swarbrick said, these regulations were passed in 2019 and here we are in 2022 under the current track before this bill makes its way into law later on tonight or maybe tomorrow morning. As Chlöe Swarbrick said, landlords have got till 1 July 2023, and we’re now getting the extension to 2024. But it’s a long way through and a long way down the line already. And, of course, COVID’s only turned up in 2020.

This is embarrassing because Kāinga Ora has simply failed to fulfil its obligations. And the poor old private sector landlords who have done the right thing in the last few years, who have actually moved heaven and earth to comply with the regulations, and gone out and done what they need to do. Many of them are under quite significant financial pressure because of the Government’s war on landlords, and the extension of the brightline test and the removal of interest deductibility has put enormous pressure on landlords. And they’ve gone and done the right thing. So here we have this situation where the double standards apply—the double standard where most private landlords have done the right thing, moved heaven and earth, and have complied with the regulations. But the Government landlord, the monopoly or near-monopolistic provider of Kāinga Ora, has acted like almost all monopolies do all the time, which is badly.

And that’s the situation we have. And the basket case that is Kāinga Ora has failed to fulfil its obligations under the law, and so the Government’s just going to give them a leave pass. So the Government’s response is not anything other than just a leave pass by dint of a piece of legislation that they’re going to ram through all stages. But we’re a helpful Opposition. We always try and do the right thing. We try and facilitate where we need to, and I see a couple of members with a wry smile over there—the member for Upper Harbour and the member for Taieri, smiling away. But they know, because they’ve been on committees with me. They know that we’re a constructive Opposition. We’re sensible, we try and do the right thing, and we’re happy to help. And I see Karen Chhour from the ACT Party is smiling, and I know she agrees with me, as the members opposite do.

Hon Scott Simpson: She sure does.

CHRIS BISHOP: That’s right. Thank you very much, Scott Simpson. And so we’re prepared to help facilitate this because we want to be sensible and constructive. But we note in passing the double standard, because it is a double standard. And the Government has turned up here and said, “You know, we’re going to do it for everybody.” But we know why they’re doing it. They’re doing it because Kāinga Ora has failed to fulfil its obligations. And so instead, we have this fig leaf, this facade, this front, where it applies for everybody, but the real target is KO, Kāinga Ora, and I think everybody in the House knows that, and, certainly, the people out there watching know it. And so that is why we are here.

So we’re going to facilitate it. We welcome it. It will be welcomed by some of the private sector landlords. It certainly will be welcomed by the thousands of extra Kāinga Ora staff who have been added to the bureaucracy in the last five years. No doubt they will enjoy that extra time. So we will support this bill, but let’s be under no illusion about why we are here. And people will see the double standards for what they are. Thank you, Madam Assistant Speaker—Acting Assistant Speaker.

ASSISTANT SPEAKER (Barbara Kuriger): Thank you, Mr Bishop. I call Vanushi Walters.

VANUSHI WALTERS (Labour—Upper Harbour): Thank you, Madam Speaker. Mr Bishop talks about an embarrassment, but I’ll tell you what’s an embarrassment is the massive sell-off of State homes by the Opposition when they were in Government. That is the embarrassment and that is the double standard. But given that the National Party Opposition are supporting the bill today, I’ll stop my critique there, and I will just commend the Minister of Housing on her pragmatism in bringing forward this important bill, and I know the Minister considered other time lines as well and gave significant thought to the time that would be required to get us to full compliance. This is a Minister who has been working very hard to also ensure that Kāinga Ora has supply agreements in place, and I know that there will be plenty of work done to ensure that they meet that new time line. I commend this bill to the House.

CHLÖE SWARBRICK (Green—Auckland Central): E te Māngai, tēnā koe. Tēnā koutou e te Whare. Statistics New Zealand data tells us that renters are more likely to pay more of their income for their housing, but, more than that, they are more likely to live in worse, mouldier, and less stable homes. I’d like to draw the House’s attention and the public’s attention, actually, to that, given that we’re going from zero to a hundred with this legislation being announced yesterday and it’s going to be passed within 48 hours without the opportunity for us to go through scrutiny at the select committee stage or to grill officials or otherwise. So, again, I’ll reiterate that we’re really looking forward to the committee of the whole House stage.

But there is a really peculiar set of rationale outlined in the many papers that have been tabled and released, and I’d like to commend the Minister for that at the very least and for tabling and releasing, particularly, the Cabinet papers and the minutes that led to this decision. But there’s a really peculiar set of rationale outlined in those papers that I want to draw the House’s attention to. Now, this won’t be exhaustive because, obviously, as I’ve just stated, we’ve been provided with less than 24 hours to kind of—or, rather, 36 hours at this point in time—go through these papers and to present these arguments and to debate this in the House, which, obviously, is going incredibly quickly, given that the Opposition is not particularly willing to put up much of a fight.

Firstly, the regulatory impact statement identifies, as I said in my first reading speech, that renters and that tenants, and particularly our most vulnerable tenants, are going to be the most impacted by the passage of this legislation, but it also states in that regulatory impact statement that the tenants, the most vulnerable tenants in this country—who are most likely to be impacted by this legislation—are precisely the group that were not consulted with. The Government consulted instead with a select group that it chose of property managers, landlords, and, of course—as many have already canvassed—Kāinga Ora.

Secondly, the Government says that in—or, rather, it’s outlined in this regulatory impact statement. Fascinatingly, because I didn’t know about this, it says that “The Government has an ongoing educational and informational programme to help landlords understand how the healthy homes standards can help maintain the value of their investment and retain tenants. These programmes may help reduce the frustration that a compliant landlord might feel.” I’m not sure how to interpret that as some kind of sell for what is being rushed through the House this evening—the fact that the Government has an educational programme to educate landlords about their responsibility to provide the human right of adequate housing to their tenants.

Thirdly, we have it, as outlined in this regulatory impact statement, that it’s believed that landlords need prompt relief—landlords need prompt relief—as they are already having to comply with their healthy homes standards obligations when tenancies start or are renewed. If we want to talk about the people that need relief, again, I think it’s really worthwhile that we go back to the core constituency, the core group of New Zealanders: the 1.5 million New Zealanders who live in rental properties, who are identified in the exact same regulatory impact statement as being primarily affected and disproportionately affected by this legislation that we’re passing through tonight, and who, again, the Government consciously chose not to consult with, given that it proactively went out and chose those groups to consult with. It is those tenants who are disproportionately living in overly expensive, more mouldy, and less stable housing who are the ones that need immediate relief.

I also find it really fascinating, again—this is on page 4 of the regulatory impact statement for those who are following along at home—where when you go through the assumptions regarding the issues that are being raised, it states—and I quote—“The key assumption underpinning our understanding of the problem is that the information provided to HUD by stakeholders is accurate and representative of the rental market for both private landlords and public housing providers.” To put that in plain English: effectively, what we have here is rationale that is entirely self-referential. The problem that this legislation is seeking to resolve is one that the Government consulted a select group on to tell them their problems, and then it is rationalising on the basis of what that select group said. Again, this is not the group that the regulatory impact statement has identified as being primarily impacted by this legislation, with that being the 1.5 million renters in this country who disproportionately live in worse homes than those who own their homes.

Fifthly, the Government is now actually trumpeting, as you go through this regulatory impact statement and also through the Cabinet paper, that they are speeding up the process of compliance, particularly with Kāinga Ora, which, of course, the Opposition has spent most of their time going through, and with good reason because the State should be leading by example. The fact that we are seeing that the Government is lagging on this and on updating—particularly with the economies of scale that it has at its disposal to purchase and to upgrade these properties—is, frankly, abysmal. In this report, it’s trumpeting that we’ve gone from upgrading and compliance of around 180 homes per week in June 2021, to 600 to 700 per week now.

Again, I have to ask the question. We have known for years that healthy homes standards are needed to be enforced by next year, but we’ve only started to see the Government start to ramp this programme up at the very tail end of things. So it prompts the question of why are we waiting until now, and—as I believe others have already also said in earlier speeches in the first reading of this bill—it is, in fact, the case that many landlords have actually sometimes got themselves in debt to do this stuff early.

We are also hearing, as reflected in the regulatory impact statement again—which I’ll continually refer to, because it is the Government’s rationale for this legislation being rushed under urgency tonight—that the Government has no idea what actually happens if we reach the compliance deadline. Now, this is a really important one for us to dig into, because what we have at paragraph 14 of the regulatory impact statement—and I think I’ll quote this for those who are interested in the House and are engaging in actual robust debate about this—is that “Currently, where private landlords have not complied with their deadline and this is brought to the regulator’s attention, the regulator will seek information to establish what efforts the landlord has taken to comply to help inform the appropriate response. Landlords are encouraged to keep records of the steps they have taken to comply in case this is sought by the regulator.” Effectively, the compliance deadline is kind of a wet bus ticket slap anyway. The Government has no idea what happens if we got to the deadline already in the legislation.

We also have, fascinatingly, a rationale in here about the fact that “In the absence of Government intervention to extend the compliance date, landlords and tenants may seek resolution through the Tenancy Tribunal. This could strain the limited time and resources of the Tenancy Tribunal.” Once again, this is a rationale for a warrant of fitness that front-loads these issues with the healthy homes standards, which currently are, effectively, voluntary, based on the fact that the Government is not collecting data on them, and, again, it continues to rely particularly on tenants for enforcement and taking them through to the Tenancy Tribunal.

The other fascinating part of this, when you get down to paragraph 19, is that it says here—and I quote—“The Tenancy Tribunal can only order someone to pay exemplary damages when they have committed an unlawful act intentionally, so a landlord who has attempted to comply would not receive an exemplary damages order.” All of that—we’re going through all of this—to extend the deadline for healthy homes standards compliance when it says in black and white in the regulatory impact statement that it is a wet bus ticket slap on the wrist for non-compliance anyway, and the very least that the Tenancy Tribunal has power to do is to simply order that a nominal charge be paid.

So I have to ask, what’s the point? The healthy homes standards—absolutely. They’re an improvement on what the status quo was prior to them being implemented. But none the less, we still have 1.5 million renters in this country who are left to fend, effectively, for themselves with these, effectively, voluntary healthy homes standards.

I just finally want to point out that there’s something called the Healthy Homes Initiative, which is run by the Ministry of Health, and it is not to be confused with the healthy homes standards. But there is some overlap, particularly because the Ministry of Health is identifying homes that are explicitly unhealthy because people are presenting in our hospitals with illnesses created by living in those unhealthy homes. And guess what? Over the last nine years, 25,000 homes have been identified as unhealthy for people to live in, but only 41—41—of those homes were ever investigated by Tenancy Services. That is a strike rate of 0.16 percent. If you speak to tenants—and many experts and researchers have—in these homes identified by the Healthy Homes Initiative, they are terrified of the power imbalance in this country, which this legislation continues to entrench.

SIMON O’CONNOR (National—Tāmaki): Thank you very much, Madam Speaker. I’m tempted to suggest to the Parliament that we just need a moment to take a breath after what were quite a lot of words firing out there from the previous speaker. One of the problems we have with the Greens—and we support this bill—is that they always believe that they and bigger government can solve every problem there is; there’s no space for the private sector. One of the reasons we’re supporting this bill tonight is because actually there is a role for the private sector along with a number of regulations as well.

Chlöe Swarbrick: You just want to regulate women’s bodies. And the gays.

SIMON O’CONNOR: The member Chloe Swarbrick still hasn’t taken a breath, but, you know, evidence is always on her side. She never has an ability to accept that there’s other points of view.

As we say, we support this bill. It’s something that we raised when the bill—sorry, the now Act—was going through Parliament a while back: that the time that was given was not going to be enough. And this side of the House had also pointed out at the time the inconsistency in that Housing New Zealand or Kāinga Ora was given different time zones. The fact that this is moving forward is positive. Certainly my observation in my own electorate is that most private landlords are moving relatively swiftly to implement what is required, and I think that’s appropriate. As I said at the start, we don’t want larger and bigger government. I’ve said before in this House that being a landlord is not a social service at the whim of the Greens and others. We want to actually work with—

Chlöe Swarbrick: Is housing a human right?

SIMON O’CONNOR: Someone is crying out, “Is housing a human right?” One of the things that she has to understand is, yes, home or shelter is a human right. How that manifests becomes slightly different—OK? That’s actually a really a subtle difference. The problem with the Greens is that it’s not just wanting shelter and a home; they have to specify an absolute high, high level of what they deem to be appropriate.

Chlöe Swarbrick: No, that’s you mate. You don’t want housing in your electorate.

SIMON O’CONNOR: I’m not your mate, because I’m on this side of the House and you’re confused on whether you’re in Opposition or in Government. Fundamentally, we’re not here to give a lesson to the Green Party in human rights or housing. We just want to note that we support the bill and thank the Minister for bringing it to the House.

ASSISTANT SPEAKER (Barbara Kuriger): Thank you. Look, I’m going to take Emily Henderson, but before we start, I realise we’re a little bit out of order. It’s past 10 o’clock and everyone’s got themselves a little bit shuffled around, but I am counting.

Dr EMILY HENDERSON (Labour—Whangārei): Thank you, Madam Speaker. As the MP for Whangārei, where we have some of the most deprived and ramshackle housing in the country, I am hugely aware of the importance of the healthy homes standards, hugely in favour of the work being done by this Government, and hugely admiring of both Kāinga Ora and our private providers, who are both managing, neck and neck, to get through this. But pragmatism is necessary in order to reach some sort of appropriate achievements. We need pragmatism. This bill is going to give it to us in an environment where COVID has prevented people getting things done on time. I commend this bill to the House.

DAVID SEYMOUR (Leader—ACT): Thank you, Madam Speaker. Good things come to those who wait, and what a debate tonight. I really hoped to follow my friend and colleague Chlöe Swarbrick. You know, despite being from fairly different perspectives, I think we are friends; I hope Chloe would say that. I hoped to follow her because I thought her speech was so interesting. If you cast your mind back to what Chlöe Swarbrick said, she said two things: one is that housing is a human right. I think that’s very interesting, and I’ll come back to that. Then she pointed out that we are tonight extending the deadline for healthy homes compliance, and there’s going to be a new date after which, in theory, all houses, whether they’re the Government’s houses or the private sector landlords’ houses, must meet the healthy homes standard. You put those two things together—housing is a human right, and there’s a certain date where they must reach the standard—and it leads to the question of what happens if a house reaches the date and it doesn’t meet the standard? This is a really difficult thing for the Chlöe Swarbricks of the world, because does she want that house to be emptied out? Would she rather have a person kicked out of a house and be homeless than live in a house that does not meet the healthy homes standard?

Now, I’ll give it to Chlöe Swarbrick and the Greens—no matter how illogical, they hold their beliefs passionately. The Labour Party, they are a bit more like National; they are very pragmatic. When it comes down to it, there’s always an escape hatch, and, as Chlöe Swarbrick pointed out actually, what happens when you get to the end of the road and you meet the 1 July 2024 or 2025 deadline? Well, you can be fined, the tribunal can seek information about what you’re going to do, but there’s no real consequence, because no sane person would actually say they wanted to kick someone out of a house and make them homeless instead of having them in a home that hadn’t passed the healthy homes standard.

Once you’ve worked through that, it tells you something interesting about this whole healthy homes policy. You see, the thought is that somehow it’s going to be possible that passing a law will actually improve the quality of housing. The problem is that that just could not be. All it could do is force people to take resources away from some things they were going to spend money on and put more of it into housing. You see, people already have the option of buying or renting a nicer house, but often people don’t, because they can’t afford it or they would rather spend their money on other things, such as food, or education for their children, or clothing, or entertainment, or whatever it is that they want. What the healthy homes standard really does is forces people to take money that they’ve chosen not to spend on healthy homes and spend it on housing of a certain standard. That’s all it does—it forces people to take money away from other things and put it into something that the Government thinks they would be better to do. It doesn’t actually make people better off. In fact, it makes them slightly worse off, because they have to spend money on what was their second-best choice. If they had already decided to live in a house that met that standard, then this law would make no difference.

The problem with this law is that it is, effectively, the same as saying, “We would rather people had no home than live in a home that breached the healthy homes standard.” But as Chlöe Swarbrick pointed out, that’s not actually what the law does, and it cannot do. So why do we have this law? It’s a very good example of the kind of thing that Governments and political parties—especially over on the left, but sometimes on the right, of the blue variety—do all the time. You see, the reason they passed the law is not because it will leave people better off. We’ve shown that this law can’t leave people better off, because you’re not actually going to kick people out. What it does show is that it will reward politicians because they’re seen to do the right thing. They hope that nobody is looking closely enough to check whether it’s actually delivered. If people did look a little closer, they would see a law that hasn’t been met on time, that has to be extended tonight, and that, actually, if people don’t comply, there are no consequences, because if there were, people would end up being made homeless instead of living in a house that hadn’t met the standard.

Then if they look a little bit more closely, what they see is that all this law has done is force people to spend more of their scarce income on housing than they would otherwise choose to. It says, “The Government knows how to use your household budget better than you do.”, as if somehow the Government has greater knowledge. That’s all it is. But of course, none of those things matter, because so long as the Labour Party can get up and say, “We’ve done something to deliver a better level of housing to people.”, then that might be enough to get them re-elected and the whole process continues on, but people are all the poorer.

It all turns into a good example of what Chlöe Swarbrick was talking about earlier. You remember, she had two ideas. One is that you don’t actually get kicked out of your house—of course you don’t. But the second was that Chlöe Swarbrick said that you have a right to housing. Well, the interesting thing about a right is that you can only have a right if somebody else has a duty that corresponds to that right—a duty to actually deliver. If you have a right with no duty, then actually you don’t have any right.

The people on the Labour benches, they’re exasperated, because they try not to think this way, otherwise it hurts their wee minds, but it’s true. When they say that there’s a right to housing, what they’re really saying is that somebody else has a duty to provide it for you. If it was just a right that you provided your own housing, that wouldn’t be any kind of right at all; it’s only a right because you expect somebody else to do it for you.

The great difficulty, as we’ve seen already with Chlöe Swarbrick’s speech, is that, actually, you can’t force somebody to get a home up to standard, and if they fail to do it, your basic choices are either to kick someone out and have them homeless or continue to live in the same house. You can’t enforce the duty of getting the house up to the healthy homes standard. The whole thing is a nonsense. It is a PR game. It is spin, designed to allow the Labour Party to tell voters that it has lived up to their expectations, to their feelings. But once you analyse how it actually works, you see that, at best, all it is going to do is re-prioritise some people’s household budgets to pay higher rent than they had already chosen to pay.

It’s nice to have these debates sometimes. It’s nice to have my old mate Chlöe Swarbrick here, because sometimes we can actually learn a little bit about Parliament, about politics, and how policy actually works. I particularly look forward, now, to what I think is about to happen, that somebody from the Labour Party is going to jump up in exasperation, with lots of “Tut, tut, tut! How could you be so stupid? Don’t you know everything that I know?” attitude and try and prove me wrong. The people at home will be able to figure it out for themselves. All they have to ask themselves is have these people from the Labour Party shown how anyone can have a right to something without forcing someone else to deliver on the duty of giving it to them? And is it possible that a healthy homes standard can make you better off, if you already had the option of buying a better home, but either didn’t have the money or had chosen to spend it differently? And what actually happens when a house doesn’t meet the deadline? Do you move out and be homeless, or do you keep living in the house, because you have no other way of delivering? Thank you, Madam Speaker.

Dr LIZ CRAIG (Labour): Thank you, Madam Speaker. In reply to my colleague over the other side of the House: I spent years monitoring child health, and seeing thousands and thousands of sick children coming into hospital with housing-related conditions. I spent years advocating for healthy homes standards, and it was amazing that within months of us coming into Government, the Healthy Homes Guarantee Act passed into law. It’s one of the things that I’m most proud of. And so it’s amazing also to see the progress that’s been made, with about 80 percent of private rentals now either meeting the standards or work under way, and similarly with Kāinga Ora homes. So it’s amazing to see the progress, but we can’t also forget the impact that COVID’s had on supply chain disruptions, workforce shortages, problems getting heat pumps coming into the country, and so this bill is a pragmatic solution, but it also ensures that houses are compliant by 1 July 2025. I commend it to the House.

ASSISTANT SPEAKER (Hon Jacqui Dean): Penny Simmonds; this a split call—five minutes.

PENNY SIMMONDS (National—Invercargill): Thank you, Madam Speaker. And Madam Speaker, in this, my first call when you’ve been in the Chair, can I pass on my congratulations to you on that.

ASSISTANT SPEAKER (Barbara Kuriger): Thank you.

PENNY SIMMONDS: I’ll take a very short call on this, much as it galls me to be supporting Labour giving themselves a “get out of jail free” card, which is exactly what this bill is, it does however extend that grace period for private landlords and therefore we should support that. But I’m sure landlords are very aware that it is only happening because Labour couldn’t get their own house in order. So on that basis, we support it. Thank you very much, Madam Speaker.

ASSISTANT SPEAKER (Barbara Kuriger): Excuse me, is the Māori Party going to take a call?

Debbie Ngarewa-Packer: I’m not sure if my colleague is online.

ASSISTANT SPEAKER (Barbara Kuriger): No, he’s not.

HELEN WHITE (Labour): I’ll just take a short call on this matter. Yes, so this is something I’m extremely proud that the Labour Government has done. I too have had discussions with people who are in a medical profession who told me that this is where we can get the best bang for buck. If we actually make our houses warm and dry, we will actually save real lives. It was actually Dr David Galler who was talking to me about this, and he was saying that we had a system which had actually turned many of our hospitals into places where we dealt with chronic disease instead of trauma, and that is a great tragedy. This is a pragmatic piece of legislation, and this is the kind of Government that this country needs because it will be pragmatic when it needs to be but it will also be principled and it will save lives.

ASSISTANT SPEAKER (Barbara Kuriger): I call Brook van Velden.

BROOKE VAN VELDEN (Deputy Leader—ACT): Oh—

Andrew Bayly: Really?

BROOKE VAN VELDEN: —thank you, Madam Speaker.

ASSISTANT SPEAKER (Barbara Kuriger): Yes. We’re up to call 10. You’re call 11, Mr Bayly.

Dr Duncan Webb: I raise a point of order, Madam Speaker. The Business Committee has resolved the split of calls, and the ACT Party gets one call in a debate at second reading.

ASSISTANT SPEAKER (Barbara Kuriger): So Labour Party took the Māori Party call, no one from Labour stood up to take the following call. And Brooke van Velden actually has stood up to take the call, so Brooke van Velden has the call.

BROOKE VAN VELDEN: Thank you, Madam Speaker. It’s amazing what can happen in this Parliament if you’re willing to debate ideas. We need more people to take initiative in their own lives, like we need to take initiative in this Chamber to stand up and take calls.

I want to just start by refuting something that one of our Labour colleagues has just said: that they are proud of this law and they are proud of this law coming to Parliament. And I question how anyone in the Labour Party can be proud that they have created a law where it’s one rule for landlords and one rule for Labour. How can you be proud, as a Government, to create a healthy homes standards piece of legislation that said, “We expect all private landlords to come up to scratch with the healthy home standards by 1 July 2021, and if you have a new house or a renewed tenancy, we expect you, within 90 days of that deadline, to bring your House up to healthy homes standards. But we, as a Government, believe that we should have an extra two years beyond what a private landlord has.” I don’t understand how a Government can be proud that they hold private citizens at a much higher standard than they do of themselves. And yet, even when we get close to the deadline that the Government set for itself, it says, “Oh, sorry. It’s been a really, really tough time with COVID and we can’t meet that. We can’t even meet that standard that we set for ourselves, let alone the high standard for other people.”

But it’s constantly, from this Government, one rule for them and one rule for everybody else. And I just take the point that this is not the only piece of law that has put a division between private landlords and the Government. When we look at the interest deductibility rule changes that came through many months ago, we had the private landlords being told, “You, now, will have your interest deductibility limited, but not the Government. If it’s the Government, that’s something different. We can still deduct our interest, but just not the private landlords.”

And when I come to another example, it was about the heat pumps. Now, under the healthy homes standards, there are heating standards. A little while ago, we had the Government admit that it got the heat standards wrong, that private landlords had been spending up large on heat pumps that were overcooked for the size of the rooms that they were being put in. And we had, for months, landlords telling the Government, telling the Minister, Hon Dr Megan Woods, speaking publicly, emailing through that the heat pumps that they were being required to put into their own homes under the heat pump standards, or the heating standards, were way too big for the houses that they were being told to put them in. Nobody from the Government listened.

It just happened that I looked through a Cabinet paper and I saw that the Government, right before they decided that they actually needed to change the heating standard—bearing in mind the private landlords had been spending thousands of dollars on these already—had said, “Our own new Kāinga Ora developments won’t meet the heating standards and we’re going to go have to go back and spend millions of dollars on retrofitting brand new Kāinga Ora developments because they don’t meet our own heating standards.” That is another example of one rule for private landlords and another rule for the Government, because the Government didn’t care about private landlords and the huge cost that has been imposed. They just didn’t listen. They only cared about themselves and whether or not they would have to fork out millions of extra dollars because their own new developments didn’t meet their own healthy homes standards.

Parking those two issues, you’ve now got the whole issue of, well, the Government can’t get all of their Government-owned rental accommodation up to the standard that they expected of private landlords, so they are making an extension. But, a year ago, I was in this very Chamber asking for an extinction for private landlords because they had come to me to say, “We can’t meet the deadline because the Government has forced us into a lockdown.” Now, at that time, I tried to publicly advocate for these landlords, who are trying to do the right thing under the law, to make sure that their homes met the healthy homes standards, and the Government turned around and just said, “We don’t care.”

Karen Chhour: Too bad.

BROOKE VAN VELDEN: Too bad, as my colleague Karen says. And people have forked out thousands of dollars, under time constraints, to bring their homes up to these standards, and the Government just said, “We don’t really care. If you miss the deadline, we’re not changing that for you.” Well, it turns out, when the Government realises they can’t meet their own deadline, well, they’ve got lots of compassion for themselves, but not for the private landlords.

Karen Chhour: Shame.

BROOKE VAN VELDEN: So—I think it is shameful that this Government and members of the Labour Party can come to this House and say that they are proud of this law going through. They are proud of the fact that they couldn’t meet the standards. They are proud of the fact that they have to come and ask for another extension when they didn’t listen to the problems that private landlords were having with interest deductibility, where people have now had to sell their homes to tenants, who have been living in them for years on lower than market rent because they genuinely care about the community—they don’t care about that. They didn’t care about the fact that landlords were putting in heat pumps thousands of dollars more expensive than was actually required, because the Government got that wrong. And they didn’t care that landlords were very stressed that they couldn’t get their houses up to scratch within the prescribed deadlines because the Government had forced them into a lockdown and they physically couldn’t do it. But they only cared about themselves, because it’s one rule for everyone else, and one rule for Labour. I think they should be ashamed of that, not proud.

ANDREW BAYLY (National—Port Waikato): Well, thank you, Madam Speaker. It’s a pleasure to be talking at 10.37 p.m. on the Residential Tenancies (Healthy Homes Standards) Amendment Bill!

So I listened very carefully when the Minister of Housing introduced this bill tonight, earlier on, some time ago. When a Minister starts talking about taking a flexible and pragmatic approach, you know something’s really happening! I want to say what I really want to say, but in parliamentary language you just can’t say it, can you? But it means things haven’t gone well.

Hon Scott Simpson: It could be a cluster!

ANDREW BAYLY: Yeah, a bit of a cluster. But, anyway, what it really means is the Government hasn’t delivered again. That’s what it is. This is a bill about lack of delivery.

I’d be far more supportive of it—and I know we are going to support it—if the bill allowed private landlords to have an extension, but when you wrap in the Government organisation controlled by the Minister, and they’ve got 23,000 buildings, houses yet to update, and they’re the ones who put the rule in place—what the dickens!

Anyway, hopefully the Minister’s not going to stand up in a year’s time and say, “You’ve got to be flexible and pragmatic”—and it won’t be a COVID next time—hopefully, it’s not going to be another COVID reason. It can’t be nine years of neglect; no, that’s not going to work either.

Stuart Smith: Five years of failure?

ANDREW BAYLY: Oh, five years of failure; I don’t know, you don’t want to have six years of failure.

Well, anyway, we will support it. But the Government should have got its act together. The Minister should have been over the top of it. To use the term “flexible and pragmatic” is just an excuse.

Dr DUNCAN WEBB (Labour—Christchurch Central): Thank you, Madam Speaker. We are a pragmatic party. We don’t require people do the impossible. We don’t punish them for doing things that can’t be achieved. This is a simple response to some difficulties in supply chain and labour shortages. It’s a great bill. We’re still committed absolutely to healthy home standards. I commend this bill to the House.

Bill read a second time.

ASSISTANT SPEAKER (Barbara Kuriger): I declare the House in committee for consideration of the Residential Tenancies (Healthy Homes Standards) Amendment Bill.

In Committee

Part 1 Amendment to Residential Tenancies Act 1986

CHAIRPERSON (Greg O’Connor): Members, the House is in committee on the Residential Tenancies (Healthy Homes Standards) Amendment Bill. Members, we come first to Part 1. This is the debate on clauses 3 and 4, “Amendment to Residential Tenancies Act 1986”. The question is that Part 1 stand part. The member’s name just escapes me.

Chlöe Swarbrick: Chlöe Swarbrick.

CHAIRPERSON (Greg O’Connor): Chlöe Swarbrick.

CHLÖE SWARBRICK (Green—Auckland Central): Chlöe Swarbrick—I’ve only been here five years, Mr Chair!

Hon Member: Ageing.

CHLÖE SWARBRICK: Ageing—I am. I have two questions at the top of this debate for the Minister that will come as no surprise, given the preceeding debate to this point. The first question to the Minister relates to something specifically outlined in the regulatory impact statement, at paragraph 23, on page 9—if the Minister or her officials would like to go to that point, so that we can get an answer for the committee tonight, noting, of course, that we’re not going to have a select committee stage, so we’re not able to get this information in front of us and thoroughly go through it as parliamentarians, through due parliamentary scrutiny; nor are we able to get our Official Information Act requests processed or our written questions answered in the next few hours that the committee has tonight.

So the first question relating to paragraph 23 on page 9, which I see the Minister and officials have got to now, is: what stakeholders were approached for the “targeted conversations” around this policy and the policy decisions that led to this legislation? I think that’s a really important piece of information and evidence for the committee to have in front of it as we continue this debate tonight, because, of course, as has been well canvassed, what the regulatory impact statement identifies is that tenants are going to be the most impacted by this legislation but it was not tenants who were consulted with. In fact, we saw these targeted conversations with stakeholders who were landlords, who were property managers, and, of course, as many have already identified, Kāinga Ora.

The second question to the Minister is kind of elaborating on her response to my questions in the House in question time yesterday. She noted, in response to a question that was about exactly these delays to the healthy homes standards and some of the failures of implementation and enforcement of the healthy homes standards, that the Government had actually considered a warrant of fitness at some point in time. Again, I note that whilst I put in an Official Information Act request yesterday and a written question on precisely this, we are not going to get a response in time for that to contribute to the substance of this debate, so I would really appreciate further information from the Minister on precisely when and how robustly and to what extent and whether it was consulted on and what on earth happened with this idea of a warrant of fitness, which, as we’ve canvassed in earlier speeches throughout this debate, would have addressed many of the key issues with the healthy homes standards, not least the fact that currently the burden for enforcement falls, in practice, on tenants to take their issues to the Tenancy Tribunal.

So those are the two key questions for the Minister. What key stakeholders were approached for the targeted conversations that led to this policy development and the legislation we’re debating tonight, and, secondly, when, how, to what extent, and where did the Government consider a warrant of fitness, and why did it come to the conclusions it did to not implement them?

Hon Dr MEGAN WOODS (Minister of Housing): Thank you, Mr Chairman. Just on the two specific questions that the member’s put forward, I think if the member goes through paragraphs 23 to 30 of the regulatory impact statement, it gives a clear indication of who the targeted consultation was. It’s an important question, but I think equally important is for members to understand what it is that this piece of legislation is doing. This is not a piece of legislation about whether or not we should have healthy homes standards for our homes in New Zealand. That bill has already been through this Parliament. That debate has been had. There has been a select committee process. Everybody has had the chance to submit on it. The bill we are debating tonight is about whether, in response to a global pandemic that causes supply chain issues around the world—the fact of the matter: there was a shortage of heat pumps in New Zealand for a period of time, particularly in the days of 2020 and 2021. We all know the tangle that we got into at the Ports of Auckland, and heat pumps were one of those products that got caught in the supply chain issues.

So I think it’s really important to have absolute clarity that we are not debating the “if”. That is a piece of legislation that was passed by our Government in our first term, something we made a priority of when we first came to Government, because people having warm, dry, safe places to call home was an absolute priority for us as a Government. So in terms of which stakeholders were consulted, it was those who had to comply. We were getting feedback that they simply would not be able to comply and therefore would be breaking the law—they would be knowingly breaking the law. So the targeted consultation was with those people and around the feasibility of meeting the regulated time frames that they had to comply within. It wasn’t about going and asking tenants whether or not we should have warm, dry, healthy homes, because, as a Parliament, we had already decided that. As a party and as a Government, Labour had already made that a priority and had passed law to that effect.

In terms of the warrant of fitness and whether that was considered—in fact, I think the member who asked that question in this committee stage asked me a similar question in oral parliamentary questions yesterday. There was a cost-benefit analysis that was undertaken in terms of the ability of putting standards and regulations in place, as opposed to a warrant of fitness, and it came out in favour of the approach that we ultimately took. This was a piece of work that I think, from memory—and I will get officials to confirm this with me—was carried out by Sapere Consulting. So that was a cost-benefit analysis that went beneath that.

Dr DUNCAN WEBB (Chief Whip—Labour): Point of order. I seek leave for all parts to be taken as one question.

CHAIRPERSON (Greg O’Connor): Leave is sought for that purpose. Is there any objection? There is objection. I call Chris Bishop.

CHLÖE SWARBRICK (Green—Auckland Central): Point of order. I seek leave for the document that the member has just noted, the cost-benefit analysis by Sapere economic agency to be tabled for the sake of this debate.

CHAIRPERSON (Greg O’Connor): The member can’t seek leave on behalf of someone else. If the Minister had been reading from the document—

Hon Dr Megan Woods: I don’t have it with me.

CHAIRPERSON (Greg O’Connor): But the honourable member tells me she wasn’t, so the call goes to Chris Bishop. Point of order, Chris Bishop.

CHRIS BISHOP (National): Point of order. I was unaware of discussions between the parties, therefore I seek leave for all questions to be taken as one. Sorry.

CHAIRPERSON (Greg O’Connor): Leave is sought for that purpose. Is there any objection? There is objection. Chris Bishop.

CHRIS BISHOP (National): Thank you very much, Mr Chair. I have two simple questions—I want to say thank you to Chlöe Swarbrick for saying one of them that I was going to ask—the first question is: did the Government give consideration to an extension beyond 1 July 2025? We are dealing with Part 1. Was there consideration given to a further extension, bearing in mind that this bill extends it out to 1 July? So I suppose the question is: why specifically was 1 July 2025 chosen?

Then the second question is an interesting one, which is I’ve gone to the Housing and Urban Development (HUD) website, as I do often, and I’ve gone to look up the regulatory impact statement for the bill, which is all fine and you’ve got to scroll all the way down through the guff, anyway, you get to the time line—and this is on the healthy homes standards—and my question is: why is the HUD website advertising that the law has changed, when it hasn’t? So here we go, 1 July 2024, “Kāinga Ora … and registered Community Housing Provider (CHPs) houses must comply with the healthy homes standard.” Well, that’s not the law. The law, as it is at the moment, is 1 July 2023. So this bill extends the time line to 1 July 2024, but the bill is not law yet, by definition. We’re in the committee of the whole House stage. And, in fact, the commencement date is the 26th. And I heard the Minister in her first reading speech say that it’s expected to, you know, pass through tonight, although given this shemozzle of an issue, we may not be; it may be tomorrow—although of course, it’s still Wednesday in Parliament’s time, but real-life Thursday, you never know. We could still be here at midnight, you never know.

Brooke van Velden: It’s still Tuesday.

CHRIS BISHOP: Oh, it’s all still Tuesday. It’s a good point. Good point. Thank you, Brooke van Velden. It’s been a long day.

Anyway, the point is this: so the website says 1 July 2024 Kāinga Ora homes and communities, registered CHPs must comply on 1 July 2025. Except those things aren’t the law—they’re not the law. I accept they’re going to be the law probably at some point in the next day or so, and then it will go off to the Governor-General, Dame Cindy Kiro, and she will sign the bill into law and it will receive the Royal assent and the commencement date for the bill is the—actually, I just want to say it’s normally the day after the Royal assent, but the commencement date for the bill is actually 26 November, which is Sunday. That’s all fine, but it’s not Sunday, and, in fact, the bill’s law hasn’t passed. It’s not the law. So my question is simply this, and I see the member’s checking off the website, which is good, which is fine. But I’m staring at it right here in the time line, 1 July 2024, all Kāinga Ora houses must comply with the law. Now, I accept the world is not going to fall apart on this issue, but this is untidy—this is untidy.

And you know, I don’t want to get all constitutional lawyer on the House, but, you know, Fitzgerald v Muldoon, I have it in my office. My friends gave it to me, framed A2 size, Fitzgerald v Muldoon. It’s in my office. And, of course, that stands for the simple proposition that Parliament makes laws, not Governments. And it was Mr Fitzgerald, a civil servant of some standing in Wellington in 1975 who rocked up to the High Court and said, “Excuse me, Mr Muldoon, you can’t just unilaterally declare that people should stop making contributions to the Labour Government’s superannuation scheme”, because, of course, these were the days when Parliament didn’t sit till June of each year, which sort of seems incredible to look back on now. But, of course, those were the days when the farmers had to go through the first part of the year. And I think also, frankly, if we’re honest, Rob Muldoon quite liked ruling without Parliament around. But Fitzgerald turned up and said to the court, “Mr Muldoon can’t do that.” And he was right because Parliament in this country is Sovereign, not the Government. So, look, I accept that this is not on the scale of Fitzgerald v Muldoon, but the principle is the same. So why has the website been changed before the law has been changed?

Hon Dr MEGAN WOODS (Minister of Housing): In answer to the first question that the member just put, in terms of the options for time frames that were considered, they are well spelt out in paragraphs 46 to 55 of the regulatory impact statement. They go through the four options that were considered: the status quo; an extension from 90 to 150 or 180 days, with a six-month extension only for public houses; option three, extension from 90 to 120 days for private landlords, and a nine-month extension for private landlords and public housing providers; or option four, which is what is in the legislation.

As to the website, I know I have a reputation as being a hands-on Minister, but I can assure the member that I’m not sitting there updating the Ministry of Housing and Urban Development (MHUD) website myself. I haven’t appointed myself webmaster-general at the Ministry of Housing and Urban Development—yet.

I have asked officials to check whether that is the case; it appears there has been information loaded up that shouldn’t have been. I’ve just asked officials to remove it, because clearly this is not law and has not been made law, but I would also like to reassure the member that the MHUD website is not Sovereign.

CHLÖE SWARBRICK (Green—Auckland Central): I want to thank the Minister for referring me back to paragraphs 23 to 30 of the regulatory impact statement. I can assure the Minister that in preparation for this committee of the whole House, I have indeed read the entirety of the regulatory impact statement. So, unfortunately, paragraphs 23 to 30 don’t address the question that I asked, and that was for a specific list of the stakeholders that were engaged with.

This is something which I put on notice to her office through written questions, but, of course—as I noted before—it’s not something that we’ll be able to get access to when it comes to the kind of content and the substance of this debate tonight.

So I think it is something that would be really beneficial for us to have in front of us, because it states very clearly at paragraph 23 that stakeholders were approached. So there was a conscious decision by the ministry—or the Minister or Cabinet or officials—to approach certain stakeholders and to intentionally solicit their feedback. So I think that it is entirely the remit of the House to ask for specifically who those stakeholders were.

Because, again, I note that it states, very clearly, that the stakeholders who were consulted with were property managers, were landlords, and were Kāinga Ora. We can say that Kāinga Ora—yep, we know that. But which property manager groups? Especially because it states that property managers who were consulted with gave very specific feedback. Which landlord groups? I would really, really appreciate—and I think that the committee would really benefit from a list of who those stakeholders were.

Hon Dr MEGAN WOODS (Minister of Housing): As the member has just indicated, she’s put in a written parliamentary question, which will be answered.

In terms of the information that I can get to hand to give in this committee stage—at this point, I’d like to say this is an indicative list. I’d like officials to go back and do a thorough search of all the records of exactly who was consulted.

But for the purposes of having debate at committee stage, Kāinga Ora—as the member has indicated—and then, of course, representative groups of landlords. Those that would be required to consult, that being the Real Estate Institute of New Zealand, which is a large body representing property managers; Crockers, which is a large property management company; and the New Zealand Property Investors Federation.

CHLÖE SWARBRICK (Green—Auckland Central): I want to thank the Minister for that indicative list and also very much appreciate that she’s across the detail and that she’d like to get back to me with more specificity in that written question answer. But I do really appreciate that.

To that list and to the stakeholders that were chosen and identified to be consulted with, my follow-up question is: was there an intentional policy decision or a decision by the Minister or by Cabinet to not consult with tenants or tenant organisations?

Hon Dr MEGAN WOODS (Minister of Housing): I feel like we have traversed this ground, that I have answered this question from the member. I said the purpose of the bill that we are debating here tonight is from those who were required to fulfil the requirements. It was not whether or not we should do it; that was a decision that our Government had already made. That was a decision that this Parliament had already. This was about the ability of those that were required by that law to fulfil the obligations under the law. Therefore, it was an intentional decision to consult with those who had the requirement under the law and whether or not they could fulfil it. It was around their level that they’d managed to do, what their purchase agreements looked like in terms of getting access to the materials. This wasn’t a question of whether or not we should do it; this was a question of whether or not there could be compliance. So it made sense to talk to those that were required to comply.

CHLÖE SWARBRICK (Green—Auckland Central): When it comes to that compliance, as the regulatory impact statement also canvasses, we have an issue with regard to data and the survey which many have bandied about. The 85 percent compliance from private landlords is data that comes from a survey commissioned by the Government to try to get a sense of compliance. However, I’d note that both in the regulatory impact statement and the departmental disclosure statement and in that survey itself, it outlines very clearly that that survey is “not statistically significant”. So I wanted to ask the Minister if there was any consideration given to other methods of collecting this data or this evidence, or if that as a baseline was acceptable to the Government.

Hon Dr MEGAN WOODS (Minister of Housing): Again, that was traversed in oral questions in this House yesterday. There is a large body of work that is going on in compliance, not through the Ministry of Housing and Urban Development but through the Ministry of Business, Innovation and Employment (MBIE), through the Tenancy Services team there. In fact, there was funding in the Budget to ensure that we did have expanded compliance services, and I outlined what they were in question time yesterday.

But, to recap, MBIE is responsible for the enforcement of the healthy homes standards, and they have a range of compliance tools. The Tenancy Services’ Tenancy Compliance and Investigation Team (TCIT) work programme is now required to complete 3,000 pieces of work with landlords and property managers for the year ended 30 June 2023. As I have informed this House before, that is not just reactive; that is a proactive compliance role that that team has. And, actually, most of the investigations that have been launched to date have been as a result of proactive initiatives by the compliance team there. Its work programme is based on a risk-based enforcement programme approach, and outcomes are determined by the extent of harm or the risk of harm, taking into account the scale, conduct, attitude, and the public interest.

So we are targeting a lot of the compliance measures to some of our most vulnerable communities, where we know that there have historically been homes that haven’t reached those standards. Since 1 January 2022, the TCIT has completed 572 cases where healthy homes were an aspect, of which 494 were proactive cases—so the vast majority of them were proactive; 78 resulted from complaints; 335 of those cases were in the light-touch work programme; 25 were detailed assessments; and the balance made up of proactive, general, and investigations. Approximately 33 percent of the cases that I just outlined resulted in TCIT determining that there had been a breach.

Dr DUNCAN WEBB (Chief Whip—Labour): I move, That the question be now put.

CHLÖE SWARBRICK (Green—Auckland Central): Thank you, Mr Chair. I have a number of follow-up questions to the Minister of Housing, and I really appreciate what, I feel, is a pretty robust committee of the whole House stage, in absence of our opportunity to give this due parliamentary scrutiny at select committee.

So I just wanted to drill into those points as raised by the Minister, particularly about Tenancy Services, because I think this is one of the key issues when it comes to evidence and data on healthy homes standards compliance. It’s something which I put in a relatively flippant question earlier this year to the former Associate Minister of Housing the Hon Poto Williams about whether the Ministry of Business, Innovation and Employment (MBIE) needed to update its computer systems, because, of course, it is the case that with every new tenancy that is registered, documents or the contract have to be uploaded to Tenancy Services, and, as a result of that, the healthy homes standards compliance sheet as well has to be uploaded. Therefore, theoretically, we already have a kind of framework that would be able to track potential compliance. Is it the case that we just need a tick-box in the process of uploading data on these new tenancy contracts, so that MBIE can keep track of that proclaimed healthy homes standards compliance? I just wanted to ask the Minister: had there been any thoughts given to updating MBIE’s services to that effect?

Secondly, I just wanted to really drill into that point of compliance, because, as the Minister has already stated, there is increasing work when it comes to attempting to do some proactive mahi there with regard to compliance. But, none the less, what we’re seeing reflected in the regulatory impact statement is that even if this legislation weren’t to exist—this legislation that extends the time frame for compliance for private landlords and for Kāinga Ora—officials are advising that, effectively, there’s not really all too much of a penalty for landlords that don’t comply, even if they get to the Tenancy Tribunal, if they can showcase that they have been attempting to comply.

So, I guess, I just wanted to also ask the Minister: what consideration, if any, was given to, perhaps, creating, with this legislation that is going to have the greatest impact on tenants, as, again, identified in the regulatory impact statement that did not consult tenants—if there was any consideration of also incorporating a better backstop or a better form of enforcement with regard to compliance, particularly where cases get to the Tenancy Tribunal? It would have been a perfect opportunity to not just postpone the implementation of compliance but also to ensure that when compliance and those backstops were actually reached, we had proper enforcement provisions in the first place.

BROOKE VAN VELDEN (Deputy Leader—ACT): Thank you, Mr Chair. I had a question to the Minister in the chair, Megan Woods, regarding the consultation with stakeholders—just two basic questions. The first is: what was the time frame for the consultation? Was it last year or this year, and over what period of time? And then, secondly, when it comes to the consultation that did occur, the Minister touched on the fact that the consultation was not about whether or not the stakeholders were asking for an extension but it was merely about what the compliance was like for these stakeholders. Did these stakeholders ask for any extensions, or was it merely a data-gathering exercise?

Hon Dr MEGAN WOODS (Minister of Housing): I think there’s been a misunderstanding of an answer that I gave to another member. I said that the consultation wasn’t about whether or not we should have a healthy homes regime; it was about whether or not they could comply, whether or not there was an extension needed. So I think that we just need to be really clear what that answer was about. In terms of the stakeholder consultation, that was carried out in April and June of this year, I am advised.

CHLÖE SWARBRICK (Green—Auckland Central): I also wanted to ask the Minister about paragraph 12 in the regulatory impact statement—of course, everybody’s favourite document in this committee of the whole House stage—at page 8, paragraph 12. It states—and I quote—“Kāinga Ora predicts that there will be 5 to 10 percent of properties still to comply on 1 July 2023. This estimate does not account for any further issues in relation to trades constraints and supply of materials due to supply chain issues. This, of course, is part of the rationalisation of this extension, particularly for Kāinga Ora.” So, given that there is only a breakdown for Kāinga Ora and how many properties would be outstanding with compliance at that date as currently in the legislation for 1 July 2023, I’m wondering if the Minister or officials can perhaps share with us whether there was any estimation or prediction about how many private landlords would still be needing to comply at the time frame as outlined in the legislation as it stands prior to this amendment passing tonight.

Hon Dr MEGAN WOODS (Minister of Housing): The paragraph that the member is referring to, paragraph 12, talks about the number of tenants that will be outstanding at the July 2023 deadline. This goes to a point that I made in an earlier stage in this Chamber—that many of these, and a proportion of these, are not because of supply chain constraints. They’re not about the inability to get hold of a heat pump. It’s not about the inability to get hold of batts. It’s not about the fact that there might not have been enough tradespeople to install them or that those resources were stretched. It’s about the number of our tenants in Kāinga Ora homes who are some of the most vulnerable in our communities. There has been reticence for people to allow tradespeople in their homes in the time of a global pandemic. And that’s something that we are highly attuned to as a landlord, something we are respectful of—the wishes of our tenants. So while we have been approaching our upgrades on an area-wide or a street-wide approach, but with escalation services of it, we have been cognisant of the wishes and fears of many of our tenants around allowing tradespeople into their homes.

We are working through that. We have tenancy managers who are working with tenants to get them to a place where they feel safe; they don’t feel they are being put at risk—bringing a tradesperson into their home puts them at greater risk of contracting COVID. And that is something that we will always do. We always will put the welfare needs of our tenants first, and that may be conversations about whether or not the tenant needs to move. But that will be a critical thing and that is what that paragraph is referring to.

So we could have kept that July 2023 date. We could have pushed on through—we’re doing between 600 and 700 houses a week—but what we do know is that would have required an approach with our tenants that, as a landlord, we’re not prepared to take, given that we are a landlord to some of our most vulnerable in this country.

In terms of how that translates, in terms of what the delta will be for private landlords, of course that is slightly different. We know that the turnover of tenancy for private properties is much higher than it is for public landlords. We have usually, roughly, some caveats around the fact that it’s going to include multiple houses and multiple people within it, but you’d see about a 30 percent turnover in the private rental market, which, of course, is a trigger for needing to institute the healthy homes. So it is impossible to model. What you can see is that, at the moment, in terms of the starting and completing, we’ve got roughly the same. So you’d probably have to say there’d be similar figures. But it is very complicated.

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

RICARDO MENÉNDEZ MARCH (Green): Thank you, Mr Chair. Just following up on those comments around putting the welfare of Kāinga Ora tenants at the forefront, I want to get an understanding if, at the point of developing this legislation and setting the new time frame, there was any analysis done around the potential impacts on the interrelationships between the wellbeing of tenants in Kāinga Ora homes—some of whom, as the Minister has acknowledged, are living in precarious situations or with health conditions—and how this exemption of the deadline may put additional pressures in the healthcare system as a result of people continuing to live in unhealthy homes, and what are some of those costs that may be incurred as a result.

Secondly, were there any considerations about additional support provided for Kāinga Ora tenants who may still be living in unhealthy homes while this compliance is moved forward? Because while I do note that acknowledgment—and that is true that many tenants in Kāinga Ora homes are living in particularly vulnerable situations—I’d have concerns about the fact that without additional support being provided while those homes are being made healthier, some of those tenants may end up facing worse health outcomes. So I’m just wondering whether there was any analysis around any additional support required to support those tenants while the deadline is met.

CHLÖE SWARBRICK (Green—Auckland Central): Thank you, Mr Chair. In addition to the comments and the questions of my learned colleague and mate Ricardo Menéndez March—that is, in reference to an earlier point in the debate from the member of Tāmaki, for those who are not following along at home and the officials who are having to listen to this debate. I heard from the Minister that the rationale, or one of the core parts of the rationale, for this extension, and particularly in relation to paragraph 12, was the fact that, apparently, the kind of 5 to 10 percent of properties still outstanding, or predicted to still outstand, to comply at that 1 July 2023 deadline is largely because the tenants in those Kāinga Ora properties are kind of particularly hard to reach, for lack of a better kind of definition.

To that effect, I did really want to drill into whether there were alternative approaches that were considered beyond just extending the time frame, because I think, as we’ve already canvassed in this debate quite thoroughly, as also identified in the regulatory impact statement, there’s not really all too much in the way of a penalty for a lack of compliance, even if you get to that Tenancy Tribunal stage, if you can demonstrate as a landlord that you’ve attempted to comply. So I’m just wondering what kind of consideration was given to those alternative supports around, for example, trying to support those Kāinga Ora tenants to perhaps understand that these things are part and parcel of a healthier outcome for them with regard to their homes.

But also, and the countervailing point, if this is kind of part of the rationale, then how is it that the Government can be certain that with these tenants who are concerned about the spread of COVID-19, a pandemic that is not going away anytime soon, an extra year on the time frame is going to get us there? Why were there not other ways of attempting to get that compliance up considered or contemplated or included in this legislation?

Hon Dr MEGAN WOODS (Minister of Housing): Just in regard to—I think I’ve already addressed the issues around compliance and penalties that the member who’s just taken her seat has raised, in earlier answers to questions. But in regards to questions that were raised in the contribution before that, in terms of whether or not there were considerations given to different approaches, whether or not there were considerations for further support for those tenants that were in these homes, one of the things I do want to make clear is that all of that 5 to 10 percent isn’t vulnerable tenants; I said a component of that 5 to 10 percent, so I wouldn’t like any member in this Chamber to misinterpret that.

But one of the things that we are operating is an escalation service. Obviously, our tenancy managers have intimate knowledge of tenants—their vulnerabilities, their needs, their requirements, what their health concerns may be—and I think many of us who are constituent MPs know that we’re often communicating with Kāinga Ora about the needs of particular tenants and what their needs may be. I know that it’s something that my office has—since all the time I’ve been an MP, it’s been one of the critical pieces of work that has continued through, and I know for many colleagues that that will be the bread and butter of their constituent clinics as well.

In terms of the compensation, I think that we always work with tenants on their particular needs. This wasn’t a consideration, and the modelling wasn’t given to that in terms of what the additional health costs would be. I think we kind of need to give probably some pause for thought on exactly what we’re talking about. We’re not talking about a 0 percent compliance; we’re talking about the fact that in the time since we’ve been in Government, we’ve gone from a requirement to have 0 percent of Kāinga Ora homes compliant with some kind of healthy homes standard to the fact that we now have 84 percent of our public houses either compliant or having the builders working on them at the moment making them compliant. And by the time we get to July of next year, given we’re doing 600 to 700 homes a week, we’ll be getting pretty close to 95 percent of those homes that will be compliant.

But I’m not content as a Minister to say 95 percent is near enough. If I now know that we can’t meet that target—I’m hearing from private landlords they’re not going to meet those targets—I think we have to do something. I don’t want to knowingly put people in the position of breaking the law, given that what we’re dealing with is not people just choosing not to comply with these standards. These are standards that people have got into the 80 and 90 percents in the midst of the fact that we have had a global pandemic that had lockdowns that went with it and supply chain constraints of some of the critical pieces of equipment that were required to make these homes compliant.

HELEN WHITE (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 97

New Zealand Labour 64; New Zealand National 33.

Noes 22

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

Motion agreed to.

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

Ayes 107

New Zealand Labour 64; New Zealand National 33; ACT New Zealand 10.

Noes 12

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

Part 1 agreed to.

Part 2 Amendments to secondary legislation

CHAIRPERSON (Greg O’Connor): Members, we come now to Part 2. This is the debate on clauses 5 to 11 and the Schedule, “Amendments to secondary legislation”. The question is that Part 2 stand part.

CHRIS BISHOP (National): This falls into the realm of niche question—

Chlöe Swarbrick: Give it to us.

CHRIS BISHOP: Here we go. Why does clause 7 amend the Schedule and replace the definition of “community housing tenancy”? Why does it replace the “Housing Restructuring and Tenancy Matters Act 1992” with “Public and Community Housing Management Act 1992”? It feels to me like this is a change where officials have suddenly figured out that they’ve had the wrong Act in the existing primary legislation for a while—

Hon Member: All along.

CHRIS BISHOP: —all along—and we’re just going to take the opportunity of this legislative vehicle which has sort of come about at the sort of tail end of the year and there’s a legislative vehicle that’s come available, so we’ll just slip it through. That’s what it sort of feels like to me. It’s just quite an odd thing to do. I have to admit I haven’t looked up the 1992 Act, and I haven’t even looked up the Public and Community Housing Management Act 1992. I suppose I just want to know what the reason for the change is and if anything turns on it. Yeah, thank you, Mr Chair.

Hon Dr MEGAN WOODS (Minister of Housing): Happy to oblige with an explanation. So the legislation that we are amending, the Healthy Homes Guarantee Act, was enacted in 2017. It was one of the very early pieces of legislation that we brought in when we came into Government. Of course, we weren’t content with just one piece of housing legislation; there were subsequent pieces of legislation, in particular the Kāinga Ora bill of 2019—it’s a consequential amendment that resulted from a piece of legislation that was passed after the Healthy Homes Guarantee Act, so it led to change because of that.

CHLÖE SWARBRICK (Green—Auckland Central): I just wanted to ask the Minister, given that we’ve been talking about submitters, in particular, and those property managers, the landlords, and Kāinga Ora, who were all consulted with, and throughout the regulatory impact statement, again, in particular, it consistently refers to statements that were in support of the extension, my question to the Minister is: were there any submitters that were opposed to the extension or that expressed any concerns with that extension? To that effect, what rationale was given by them about those potential concerns that may have existed out there? Because I do find it quite difficult to believe that there is a complete consensus amongst all of those property managers and all of those landlords for an extension, particularly when we consider, based on the survey—which, again, we’ve already canvassed is not statistically significant—that 85 percent of private landlords are already in compliance. So were there any of those submitters that were opposed to this legislation outlined in this legislation?

Hon Dr MEGAN WOODS (Minister of Housing): I will note that the questions the member is asking relate to Part 1 of the bill, not Part 2, the consequential secondary legislation amendments that we’re talking about here.

In terms of how it goes through, the House was given the option to debate this all as one part, but that was not a choice that was taken up by the House. But I will be liberal in my responses—

CHAIRPERSON (Greg O’Connor): The Chair will decide where it departs, but carry on.

Hon Dr MEGAN WOODS: Thank you. I will be liberal and answer, even though the ball correctly belongs to Part 1, that there weren’t submissions. I think it makes it clear in the regulatory impact statement: it wasn’t a select committee process where submissions were called for, so I think the member’s probably mischaracterising that. Of course, there were a range of views when stakeholders were consulted, around whether or not some people could fulfil it and others couldn’t, but there was no one who was opposed to it, per se.

CHRIS BISHOP (National): Thank you, Mr Chair. I have a question about Part 2, Subpart 1, and it’s this: it’s quite unusual for Parliament to amend secondary legislation, which is what we’re doing here.

Hon Chris Hipkins: No, it’s not.

CHRIS BISHOP: So Subpart 1 makes—well, it’s not under this Government. Subpart 1—

Hon Chris Hipkins: It wasn’t under your Government either.

CHRIS BISHOP: Yeah, yeah. OK. [Interruption] It’s 11.25 p.m.

CHAIRPERSON (Greg O’Connor): If members would like to take their conversation out into the lobbies that’s fine. Other than that, we’ll just deal with this as—

CHRIS BISHOP: The question is this: why are we using legislation to amend a regulation? Because regulation 7(2)(a) replaces 90 days with 120 days, why do we need legislation to do that? I accept the legislation around Part 1, which is the dates, which is fine, but why do we need legislation to amend the regulations?

CHLÖE SWARBRICK (Green—Auckland Central): I completely acknowledge the comments of the Minister before around how we’re on Part 2 of this legislation and state that we sought to continue the debate of Part 1, but, of course, members of the Government decided to try and close that part of the debate. I’d also say, as the Minister outlined in her response around public submissions—

CHAIRPERSON (Greg O’Connor): Sorry, was that a commentary on the Chair?

CHLÖE SWARBRICK: No, Mr Chair; it was a—

CHAIRPERSON (Greg O’Connor): I believe it was. The member was quite repetitive in her questioning, but carry on and avoid commentary on previous decisions by the Chair, please.

CHLÖE SWARBRICK: Thank you, Mr Chair. So, of course, as the Minister has outlined, we didn’t have an opportunity for public submissions, because we didn’t have a select committee phase of debate and public scrutiny with this legislation. And I guess that’s the core point here. Again, it needs to be restated time and again because we have less than a few hours to consider and to scrutinise this legislation when, in the normal course of events, it takes several months of—

CHAIRPERSON (Greg O’Connor): Sorry, if the member can hold, I’ll stop the clock, and I’ll just allow the Minister—there’s a conversation taking place on my right here. Feel free to consult, Minister, and we’ll carry on. I can’t do two things at once, so I’ll just do one. OK, Minister?

Hon Dr Megan Woods: I’ve finished.

CHAIRPERSON (Greg O’Connor): OK, right. So we’ll start the clock.

CHLÖE SWARBRICK: Thank you, Mr Chair. So the point that I was making is that I completely acknowledge the point from the Minister that what we’re referring to here are stakeholders who were proactively solicited, and their opinions were solicited, and they were consulted with in the process of making the policy decisions and, obviously, informing the regulatory impact statement. We didn’t have the opportunity for a select committee stage. We didn’t have the opportunity for those public submissions. So this is the only opportunity that we have in these few hours to discuss and to publicly scrutinise this. And this is the point which I think needs to continually be made.

The part that we are debating, of course, extends the time frame for compliance from 90 days to 100 days. And I would note that, again, in the regulatory impact statement at paragraph 8—but also listed throughout the regulatory impact statement—we have the point, time and again, that—and I’ll quote here—“90 days is very ambitious in the current environment.” And I guess I just kind of invite reflections on the fact that the clock didn’t start when the pandemic arrived; the clock started, as the Minister herself noted, at the point that we passed the healthy homes legislation back in 2017. If I remember clearly that was within the first hundred days. The Minister is shaking her head, and I believe that she will go on to say that it’ll be with the regulations in 2019, which, of course, this part is also seeking to amend. But the point remains that landlords and Kāinga Ora have had several years to comply. The clock started several years ago, and what we are doing now is, effectively, extending the time frame at the end of the race, at the point in time when many should have expected to already be up to date and already had years to get up to scratch prior to the advent of the global pandemic.

Hon Dr MEGAN WOODS (Minister of Housing): I’ll just address the issue in clause 6 of the legislation, which amends the regulation to replace “90 days” with “120 days”. This is a very pragmatic decision. I don’t know if the member has tried to engage the services of a tradesperson in the current climate. The ability to actually get work done within a 90-day period is challenging. People with the best will in the world could procure the hardware to do this—whether that be the batts or the heat pump—but, actually, the ability to get tradespeople to do it has also been a challenge. And that is the reason for extending that out.

There was a subsequent question from another member about why we are using legislation to amend the regulation—that particular clause that he’s talking to. In terms of us being able to do all of the changes that we needed to do at the same time, it required legislation. Believe me, if there had just been a regulatory fix to this, the Government would have taken it.

CHLÖE SWARBRICK (Green—Auckland Central): Just to respond to the point as raised by the Minister, the Hon Dr Megan Woods, and, I guess, to kind of elaborate on the point that I was trying to make: I wasn’t stating that it is easy to get a tradesperson or materials in the kind of shortage that we all know we’re currently experiencing as a result of the global pandemic. The point that I was making is that the clock started several years ago. While I totally take on board that there is the need, currently, in the legislation to comply within 90 days of a new tenancy, what we’re looking at doing, here, is extending that to 120. That that upgrading of a home doesn’t necessarily have to occur at that starting point, it can occur while a tenant is living in a home that is not currently healthy homes standards compliant. The landlord could choose to undertake improving that property. So the point remains that you don’t have to wait for a tenancy to end in order to start this process of updating to the healthy homes standards.

HELEN WHITE (Labour): I move, That the question be now put.

BROOKE VAN VELDEN (Deputy Leader—ACT): Mr Chair, thank you for allowing me to take a call on Part 2 of this piece of legislation, the Residential Tenancies (Healthy Homes Standards) Amendment Bill. I was specifically looking into clause 7(4) and I just had a question about—in regards to the consultation that’s taken place and the changes to the deadlines. And there seems to be one group of houses or house tenancies that doesn’t get an extension, and I wondered if the Minister could elaborate on what went into that, because it appears—you know, Kāinga Ora, they can get an extension now to 1 July 2024; community housing tenancies are 1 July 2024; any other tenancies, there’s a whole range of rules about extending the 90 days to 120 days, and otherwise up to 1 July 2025.

But boarding house tenancies don’t appear to have any form of extension; it’s just that we’re replacing the table with the start date of 1 July 2021. So I’ve looked at what is actually the standard for a boarding house, and it says that it’s a rental property that’s intended to be rented by at least six tenants, each tenant rents their own room in the property, and they share communal facilities, and the tenancies last for 20 days or more. Is it possible that there are boarding houses that would not have had to comply yet because of this? And I’d just be curious as to the answer.

Hon Dr MEGAN WOODS (Minister of Housing): So clause 7(4), in terms of the schedule of the dates that are in there, the principle that underlies all of these dates, of course, is that we don’t pass retrospective legislation. So the time frames that the member is pointing to are, of course, times that have passed. So when you look to boarding houses, they were required already to comply by 1 July 2021, so we can’t retrospectively change that. And I think I made the point in one of my earlier contributions that this is not a time extension for landlords that should have already complied—so if that tenancy has turned over in that time, before those dates, and that is the principle of not having retrospective legislation.

WILLOW-JEAN PRIME (Junior 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 97

New Zealand Labour 64; New Zealand National 33.

Noes 22

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

Motion agreed to.

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

Ayes 107

New Zealand Labour 64; New Zealand National 33; ACT New Zealand 10.

Noes 12

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

Part 2 agreed to.

Schedule

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

Ayes 107

New Zealand Labour 64; New Zealand National 33; ACT New Zealand 10.

Noes 12

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

Schedule agreed to.

Clauses 1 and 2

CHAIRPERSON (Greg O’Connor): Members, we come now to our final debate, clauses 1 and 2. This is debate on clauses 1 and 2, “Title” and “Commencement”.

CHLÖE SWARBRICK (Green—Auckland Central): I guess, in the final remarks on this debate, the final little bit of scrutiny and the opportunity to question the Minister in the chair, Megan Woods, we’ve canvassed as much as we possibly can, I think, in the limited time frame that we’ve had to get across all of the documents and the Cabinet paper and the regulatory impact statement as released. Unfortunately, as the Minister herself has put, we haven’t had the opportunity to hear from members of the public, and, I will just reiterate, we also haven’t had the opportunity to hear from members of the public who the regulatory impact statement notes are going to be the most impacted by this legislation, that being tenants—renters; the 1.5 million New Zealanders who live in rental properties across this country, who were not consulted with.

This legislation, is, however, titled the Residential Tenancies (Healthy Homes Standards) Amendment Bill, and, I guess, just in my final contribution in this committee of the whole House stage, if I could proffer an alternative title, one that perhaps is a little bit more explicit about the fact that this is a piece of legislation that kicks the can down the road on the entitlement that all New Zealanders have to the right—the human right that Aotearoa New Zealand recognises—to an adequate home, that subsequent Governments have recognised, that this is an extension to compliance for landlords and for Kāinga Ora to tenants having that adequate housing recognised as a human right and fulfilled through the healthy homes standards. So, perhaps, a title that is all the more adequate: something along the lines of, perhaps, “Residential Tenancies (Delay of Healthy Home Standards) Amendment Bill”.

BROOKE VAN VELDEN (Deputy Leader—ACT): Oh, thank you, Mr Chair. It is an absolute pleasure to take a call on the clauses 1 and 2 part of the debate on the Residential Tenancies (Healthy Homes Standards) Amendment Bill.

I think a lot of landlords, up and down New Zealand, will be scratching their head wondering why it was that they were struggling and forking out thousands of dollars to make sure that their homes could get up to scratch within the deadlines that the Government had set for themselves. And yet the Government is here, tonight, passing a law to give themselves an extension under the guise that it’s for private landlords when it wasn’t. It’s for the Government’s own homes, not the private landlords, up and down New Zealand, who knew that they had deadlines coming up and they did the best that they could to reach them.

This is a bill that I believe should be named the “Residential Tenancies (Double Standards) Amendment Bill” because this bill is about the double standards that this Government puts through in Parliament—having one rule for a class of people that the Government quite often paints as villains, and having a different rule for themselves. You see, landlords do their best to open up their doors and their homes to other people in our communities every day and provide them a stable, warm, dry home. You know, lots of people do that. They give up their homes and open their doors so that people have a place to live, and I think that’s wonderful. And it’s wonderful that our communities are there to support each other and that we do have rental accommodation—private rental accommodation—where people are able to have individual contracts that work for both parties. It’s a community getting around each other to provide accommodation for each other.

But, on the other hand, we have a Government that says that they can do better—they know best!—and they can use our money, our taxpayer money, to build homes up and down New Zealand, and they think they can do it cheaper and faster, but it turns out that they can’t, and they’re wasting our money. But not only are they wasting our money, they are doing new laws and new extensions because they know that they can’t meet the same standards that they set for private landlords who are opening their own homes to other members of the community.

And so I put that we should change the Residential Tenancies (Healthy Homes Standards) Amendment Bill to be the “Double Standards Amendment Bill”, because that’s what this Government is putting through tonight. They’re putting it through without really consulting with the members of the public that they say that they’re advocating for—because we haven’t seen a select committee. We haven’t given landlords and people who will be affected by this bill the opportunity to come to Parliament and actually voice their own opinion about how this law affects them and how they may not actually wish to have an extension. They may actually wish to voice that they believe that this is a facade and that the Government is simply passing this law for themselves, not for them, not for the people it says that it’s advocating for. Unfortunately, they haven’t had that opportunity.

Instead, we’re rushing this through. We’re rushing through a change and an extension. All it really speaks to is the fact that, originally, when we passed this law, it was a double standard in the first place. And it’s a double standard now that’s being brushed over with a little bit of a façade saying that it’s for the private landlords, when we know it’s for the Government and it’s for Kāinga Ora, who can’t meet the high standards that it expects of everybody else.

So these double standards are throughout our legislation. They’re throughout the laws that this Government passes, especially when it comes to building houses and when it comes to renting houses in New Zealand. But this Government should try to do better. It should try to at least get to an adequate result, especially with the healthy homes standards that it expects of everybody else. And so we should change this bill to call it the “Double Standards Bill”, rather than the “Healthy Homes Standards Bill”.

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

Ayes 107

New Zealand Labour 64; New Zealand National 33; ACT New Zealand 10.

Noes 12

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

Clause 1 agreed to.

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

Ayes 107

New Zealand Labour 64; New Zealand National 33; ACT New Zealand 10.

Noes 12

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

Clause 2 agreed to.

Bill to be reported without amendment.

House resumed.

CHAIRPERSON (Greg O’Connor): Madam Speaker, the committee has considered the Residential Tenancies (Healthy Homes Standards) Amendment Bill and reports it without amendment. I move, That the report be adopted.

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

Ayes 107

New Zealand Labour 64; New Zealand National 33; ACT New Zealand 10.

Noes 12

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

Motion agreed to.

Report adopted.

Third Reading

Hon Dr MEGAN WOODS (Minister of Housing): I move, That the Residential Tenancies (Healthy Homes Standards) Amendment Bill be now read a third time.

What we have in front of us is a piece of legislation that is not about whether or not New Zealand should have healthy homes standards. This is a question that we, as a Government, made a priority in our first weeks of Government to progress. We saw that we had an inadequate level of measures in our rental properties to ensure that these were for their benefit of New Zealanders and their health. Whether that be around insulation standards, whether that be around the provision of ventilation, whether that be around the provision of efficient and affordable heat sources. From the very beginning of our Government, this was a cornerstone project that we put into play. I think it’s really important that we understand that that is not what we’re debating.

What we are debating is about the ability of landlords, whether they be from the public sector or the private sector, to comply with deadlines that were set in 2019, before the world had even heard of the global pandemic that was coming. I don’t think it’s fair on landlords to say they should have completed it by the time COVID arrived; this had an end date of 2023 or 2024, so I think that is unreasonable. What landlords, whether they were public or private, were gearing up for was compliance in 2023 or 2024, depending on whether or not they were a public or private landlord. Of course, if they were a public landlord, they were required to have an earlier finish date than landlords in the private sector.

What we are saying, in the face of a global pandemic that caused the world to shut down, that caused our cities and towns and centres around New Zealand to go into lockdown periods, that has caused global supply chain issues, whether or not we should extend out by 12 months the ability for our landlords to comply or whether or not we should just leave the status quo and knowingly put landlords—both community housing providers, Kāinga Ora, and private landlords—in the position of breaking the law. Turning a blind eye to that is not an option for me as a Minister. It is our job to make sure that we are making laws that do not put New Zealanders in the position of knowingly breaking the law.

I think we need to also pause and think about what we have achieved. In the face of a global pandemic, we have our public landlord Kāinga Ora 84 percent compliant or having the builders in the houses doing the job, as at the latest data. We think, by the end date, it will probably be around 95 percent compliant. This is something for us to celebrate. Would I have liked it to have been 100 percent? Of course I would. Would I have liked there to be no COVID, no lockdown, no interruptions to supply chains? I think all of us would wish that for our world, but that has not been the case.

We have 85 percent of private landlords, in the best data that we have, who either have complied or are in the process of complying. I don’t think it’s correct, and we shouldn’t set this up as some kind of Olympic sprint between the public and the private sector, as some members of this House have tried to do. I want to congratulate those private sector landlords who have complied, but to claim that they have done better than the public sector is nonsense and wrong. If you look at that data, 15 percent of our private landlords had complied and 70 percent of those were in the process of starting to comply. It simply isn’t correct to say that, and I don’t think it’s useful.

What we need to do is make sure that we are working towards our rental properties in New Zealand being warm and dry and being something that is for the wellbeing of New Zealanders. We make no apologies for taking a pragmatic approach and saying that when we do see that there is going to be an issue with compliance, given what we’ve all been through in the last 2½ years, that we might have to take some of those pragmatic approaches, we will do that. Thank you very much, Madam Speaker.

CHRIS BISHOP (National): Thank you very much, Mr Speaker. I was just wondering whether or not the Minister was going to get to 5 to 12, in which case I’d have to come back tomorrow. But I’m pleased I get to finish my contribution on this debate at 10 minutes to midnight—such is the life of a parliamentarian.

We support this legislation, as we’ve indicated right the way through, because it’s a pragmatic response, but—

Hon Priyanca Radhakrishnan: That’s right.

CHRIS BISHOP: “That’s right.”, she says, straight up. But, of course, we have noted, as indeed others in the House on this side have noted, throughout the debate tonight that this is really about giving Kāinga Ora (KO) a leave pass. It’s not really about the private sector, because, largely, they have been compliant or are in the process of complying, and KO is some way behind—and I acknowledge what the Minister says about how there are thousands of homes in the process. But the simple reality is there’s a disparity between the State landlord and the private sector. So this is about bailing out—well, not bailing it out, but about giving them a leave pass.

Now, in relation to some comments I made earlier through the committee stage of the debate, I raised the issue of the Ministry of Housing and Urban Development (MHUD) website having the law as being changed before the law had actually been changed, and we are somewhat closer to that change than we were when I raised it. The MHUD website has been updated, so that’s great. I’m sure that the officials are listening—well, they probably aren’t, to be fair, and I don’t blame them, to be honest.

Hon Dr Megan Woods: They were during the committee stage.

CHRIS BISHOP: Yeah, I know, but they’re not any more, is my point.

Hon Dr Megan Woods: No, they wouldn’t be.

CHRIS BISHOP: Yeah, yeah—well, I’m sure they’re listening now. They were here before. They’re not here any more. So they’ll probably listen tomorrow. But I wanted to say thank you to them for fixing the website. I’m sure the IT guy at the MHUD website did not really appreciate a call from someone on a Wednesday night at 9 o’clock or whatever time it was. But that’s good. These things do make a difference, and they are—well, these things are important, anyway.

I don’t have much more to add. Everything I wanted to say about this bill I have said in the first and second readings. I accept what the Minister said in response to my question in the committee stage around the amendment to the regulations. It’s not ideal, although I have some sympathy for the argument that it’s just cleaner to do everything all at the same time through primary legislation. From a purist point of view, it is better to change regulations via regulation rather than coming over the top with the primary legislation. The Government can, through Order in Council, pass a regulation to amend the dates, but there’s some merit in the simplicity of just having it all in the one spot and saying, “Righty-o, here are all the changes.” Fair enough. As Chris Hipkins rather rudely, I have to say, pointed out in my question, parliaments can do that, obviously, and various Governments have in the past, including ours, although we should always try and avoid it. So with that, I will commend the bill to the House and hope for better days in the future.

CHLÖE SWARBRICK (Green—Auckland Central): Housing is a human right, and more than that, adequate housing is a human right. National members may be interested to learn that this not some new-age “wokeness” or whatever the latest culture war - baiting buzzword is.

We signed up to the 1948 Universal Declaration of Humans Rights, drafted and passed without dissent by the UN General Assembly. The UN was created, of course, after some of the world’s most devastating wars and atrocities, in hope of creating peace by enforcing basic standards for member nations and their people. The succeeding 70 years, though, saw basic tenets of that contract broken, however, as elected representatives sacrificed the goals of our shared security and prosperity in favour of individual greed and gain. We instead saw the gaming of the system to procure untold wealth for a handful of people at the expense of a large transient population around the time that we were signing the Universal Declaration of Humans Rights, around 70 years ago. In Aotearoa New Zealand, that wealth comes in the form of owning houses—in many instances, multiples of them.

Housing, or rather, human rights—and housing, it turns out—is for everyone. You don’t get human rights only if you are good, if you wear a nice suit to an open home, or if you don’t complain about the mouldy bathroom for fear of being kicked out of your rental. You have human rights because you are human. That is kind of the point. Rights are not meant to shift and change with whoever is in power changing the definition of who is worthy and who is not. We all have these rights, regardless of whether we rent or own our home.

The Government has a duty to protect the human rights of all of us to adequate housing. Despite how much less oxygen it’s given than it deserves in our Parliament, and we gave it a real good thrashing attempt tonight, as desperate leaders try to evolve polling numbers with fearmongering and culture wars, our material reality remains the biggest concern for most of us.

The Minister herself, actually spoke in her contributions earlier tonight on how adequate housing and secure housing is the basis of good mental health. Of course, that was reflected in He Ara Oranga, the mental health and addiction inquiry. If we do not have a safe, stable home, it is very difficult to build the basis for a good life.

An off-air chat with a talkback radio host cemented for me that most politicians would prefer to keep dishing out the sugar high of “whataboutism” than play—to continue with the metaphor—the stoic dentist, rectifying generations of neglect and enforcing healthier new behaviours. We don’t need UN Special Rapporteur Leilani Farha’s report, tabled in February 2021 in Geneva, to know that housing in our country has long been treated as a speculative asset instead of a home, the core ingredient to upholding that human right. Along with renters’ rights, rent freezes, and regulation, Farha suggested courageous tax changes to transform our economy from “A housing market with a few bits [tacked] on”, as defined in a 2011 tweet from a former Labour backbencher MP, now of course, the Rt Hon Jacinda Ardern.

In 1997, the UN Committee on the Economic, Social and Cultural Rights defined “adequate housing”, that human right, by breaking it down into seven standards. Of course, this was referred to in the departmental disclosure statements. We are so obviously failing on the first basic four—that is, security of tenure; habitability; accessibility; and affordability—that even paying heed to the final three—services, materials, and infrastructure; location; and cultural adequacy—feels farcical, as has been kind of demonstrated in this debate tonight.

All of us agree that we’ve got to build more homes, and in this thematic space in this debate—in the many debates that we’ve had in this Chamber over the past five years that I’ve been here—we have seen consensus on that, although not necessarily on where those homes should be built. However, what it seems that we are most unwilling to civilly discuss—again, perhaps reflected in this debate tonight—is whether we are comfortable to continue treating housing in Aotearoa as a game of Monopoly.

We have to acknowledge that this crisis of adequate housing, this human rights crisis, didn’t come from nowhere, but from a series of decisions made by successive Governments. We can’t continue to side with and consult only with those who profit from the status quo and somehow expect that that is going to result in representation of the needs of those who are not currently benefiting from it.

DEPUTY SPEAKER: One of the needs of this House is for you to talk about the bill at some stage. You’ve had five minutes now, so could you just start to steer towards the actual bill itself.

CHLÖE SWARBRICK: Mr Speaker, if I may, this legislation is about the healthy homes standards.

DEPUTY SPEAKER: We’re also talking about the bill tonight, too. So at least have some reference to it, please.

CHLÖE SWARBRICK: Mr Speaker, the bill—

DEPUTY SPEAKER: This is not a general debate speech. Let’s just talk about how it relates to the bill, please.

CHLÖE SWARBRICK: The departmental disclosure statement makes explicit that there is consideration of international treaties—

DEPUTY SPEAKER: The bill—the bill.

CHLÖE SWARBRICK: —with regard to the legislation and the bill that we are debating tonight, and that is core to housing or adequate housing as a human right.

DEPUTY SPEAKER: Relatively narrow bill—let’s just talk about the bill.

CHLÖE SWARBRICK: All right, Mr Speaker. My written questions from earlier this year show that the Government has no idea how many private rentals are currently up to scratch when it comes to healthy homes standards, nor does it know how many landlords have excluded themselves from verifying or reaching those healthy homes standards, nor does it know how many companies are holding themselves out as capable of verifying those healthy homes standards. This is not a recipe for a system that works for anyone.

The Greens have continued to call for a warrant of fitness, and that is, of course, reflected in the Cabinet minutes and documents that have been released proactively throughout this debate. We have seen that these, effectively, voluntary healthy homes standards are not working for far too many people. The Government now seems intent on restarting the clock.

So the question that we’ll leave with the House tonight is: who does that benefit? It’s not the 1.5 million New Zealanders who rent in this country that Statistics New Zealand show are more likely to spend more of their income on inadequate, mouldy housing. In fact, it is only the landlords and Kāinga Ora and the property managers who the Government chose to consult with throughout this process.

The Greens oppose this legislation because we have well-canvassed throughout this debate tonight that it delays the human rights that all New Zealanders are entitled to.

DEPUTY SPEAKER: The time has come for me to leave the Chair. The House is suspended, and I will resume the Chair at 9 a.m. tomorrow. Good night, everyone.

Debate interrupted.

Sitting suspended from 12 midnight to 9 a.m. (Thursday)

TUESDAY, 22 NOVEMBER 2022

(continued on Thursday, 24 November 2022)

Bills

Residential Tenancies (Healthy Homes Standards) Amendment Bill

Third Reading

Debate resumed.

ASSISTANT SPEAKER (Hon Jacqui Dean): The House is resumed. Good morning, everyone. When we finished last night, and I left the Chair, we were considering the third reading of the Residential Tenancies (Healthy Homes Standards) Amendment Bill. I’m advised the next speaker is a National call.

SIMON O’CONNOR (National—Tāmaki): Thank you very much—a good chance to stretch one’s legs. It’s always good to be out in front of ACT, but no offence to my ACT colleagues.

We continue to support this bill—we continue to support this bill at third reading. I think the main caveat or aspect we wanted to note is that when this legislation first went through the House before we had to amend it, we noted at the time that the time frames for both Kāinga Ora and the private sector were out of whack, and the fact that Kāinga Ora was given more time than the private sector. And the other aspect too was we knew it would not be enough, the high standards which the Government were intent on pressing upon the industry. So we sort of feel a little bit vindicated, for want of a better word.

Hon Gerry Brownlee: It is a good word.

SIMON O’CONNOR: But, as we say, we are happy. It is a good word for 9 o’clock in the morning—“vindicated”. I won’t give you the etymology; it’s just far too early. But we are happy to support this bill to the House.

Dr LIZ CRAIG (Labour): Thank you, Madam Speaker. I’d like to start my brief call by acknowledging all those landlords who have ensured their properties are complying with the healthy homes standards and the huge impact that that’s going to have on people’s lives. But I also acknowledge the impact COVID’s had in terms of supply chain disruptions, workforce shortages, and difficulties getting heat pumps into the country.

I think this bill takes a pragmatic approach by extending the time by a year but also ensuring that healthy homes standards are all in place by 1 July 2025. I commend this bill to the House.

BROOKE VAN VELDEN (Deputy Leader—ACT): Thank you, Madam Speaker. It’s quite remarkable to be standing here on a Thursday morning—but, really, in Parliament time, we’re still on Tuesday evening—and we’ve somehow managed to get through two speeches already within two minutes. But we are proud, as the ACT Party, to truly represent the people of New Zealand and bring their voices to this Chamber to represent them, and that is what we will be doing throughout urgency, because while the Government wishes to pass through 24 laws within one week, which would usually take four weeks—and it appears that many of our National Party colleagues can’t be bothered to do their jobs either and just want to go home—the ACT Party is committed to actually representing the people of New Zealand and making sure that laws don’t get rushed through Parliament without some scrutiny. We want to make sure that these laws have scrutiny and that we don’t just pass them through without looking through them in detail.

On this particular bill, this is about the healthy homes standards. We had a lot of debate last night about the healthy homes standards and we’re continuing it this morning. But for this bill, it really goes to the heart of the divisive nature of this Government, where we’re passing laws that have had one rule for everybody else and one rule for Labour. We see that in a lot of laws that have passed—in particular with housing, we’ve seen it with interest deductibility law changes, where the Government said, “If you’re a private landlord, we’re going to limit your ability to deduct your interest from your residential accommodation, but we are the Government and we believe that we are different and we are better and we should be allowed to provide housing, rather than private landlords.”, and so they had a different rule for themselves.

That goes to the heart of why we’re here today debating this law, because when the healthy homes standards were written, we had a deadline for private landlords that said that by 1 July 2021, all private landlords, within 90 days of a new tenancy or a renewed tenancy, would have to abide by the healthy homes standards. But for the Government, they had another two years. It turns out that even with that extra amount of time, the Government acknowledges that they won’t be able to bring their own homes up to the healthy homes standards. They won’t be able to meet the high standards that they expected of everybody else. So we’re here in the Parliament today to give them another extension.

I think it’s shameful that we constantly hear from this Government that the Government can do better and the Government knows better and if only the Government provided another service and if only the Government took a few more dollars out of your own pocket and provided a service for you, they would do a better job. Well, case in point, they can’t, because they don’t know better and they can’t do better. Even with the economies of scale of the massive Government and all of our money in taxes, they can’t do a better job of getting their own homes up to scratch than a private landlord.

We know that a lot of private landlords have spent a lot of time and a lot of effort and a lot of money getting their homes up to the healthy homes standards last year. We heard from statistics last night that 85 percent of private landlords last year had brought their homes up to the healthy homes standards or had actions to do so. Yet it’s only this week that that same number of Kāinga Ora homes have either been brought up to standard or are on track to be brought up to standard. So it’s not a case of the Government knows best and it’s not a case of the Government can do better—in fact, they’re failing on both.

We constantly hear that private landlords are the villains. We hear it in all of the rhetoric that comes from this Government: that the Government can do better, that they know better, and that they should provide this service, and if only the Government were more involved, we’d have better standards for living and better standards for all New Zealanders. Well, unfortunately, the Government looks after the most vulnerable tenants in our country—people living in Kāinga Ora homes—and, unfortunately, they have not taken the steps to get those homes up to the healthy homes standards for the most vulnerable tenants. But, at the same time, they’re happy to paint landlords as slumlords and say that they are the ones who are creating the housing problems and the housing crisis and they’ve got terrible water and they’ve got heating problems, and all the things that you can think about, but it’s really the Government.

I’d like to thank the landlords who have done a really good job of not only meeting the costs that have been associated with this law but by doing everything that they can to provide another home for somebody in their own community. Over the last few years, as housing spokesperson, I have heard from many people—through emails, from going to public meetings, from having one-on-one discussions with landlords and people from the Property Investors Association—that people have been really struggling and doing it tough, especially those landlords who have intentionally held their rents low because they have somebody living in their home that they genuinely care about and want to provide a safe, stable environment for. But with all the changes and all the taxes and regulations that this Government puts on them, they have become stretched to capacity and, in some cases, have needed to end tenancies for some vulnerable members of our communities.

Now, one family comes to mind in Porirua. I had a landlord reach out to me and say that they had wanted their tenants to be able to go all the way through high school at that same house and be able to give that family stability, but because of all the tax changes and all the regulations and all those added costs, it had become unsustainable for them to keep this tenancy. So they had to put their home on the market, and the result is that this family that they’d tried to give stability to had to move out and they couldn’t find a home that was that cheap in the same area and so their kid had to change schools. Isn’t that a tragedy that the Government’s policies have actually made some families’ lives less stable than they would have been?

We’ve heard from some landlords that with these changes, specifically to the healthy homes, they’ve gone into debt to try and bring their homes up to the standard that the Government expects of them. Some landlords have had to pass on that cost, the cost of up to $10,000 per home to bring these homes up to standard.

The ACT Party says that if we truly cared about some of the most vulnerable people in our community, we would make sure that they have a home, rather than an expensive home—any home at all. We see the emergency housing wait-lists skyrocket. We see the number of people in motels increase and continue to grow. We have people still living in cars and garages and living permanently in motels. Yet we’re saying to landlords, “I don’t care if you can provide a stable environment for someone. Unless you meet all of our very high standards that we can’t meet ourselves, you shouldn’t be allowed to give your home to another member of your community, because we don’t believe it’s safe enough for them.” Well, I would say that it’s better for a person to live in a home than not be able to live in one at all and need to move into emergency housing.

We need to see more residential accommodation be built and be developed and be let out to members of our community. We’re not going to see that if we keep saying that landlords are the bad guys and we need to put another cost, another tax, another regulation on them. In fact, if we did the opposite and we allowed for more investment, growth, development, and a stable environment for people to get into the building industry, we would see more housing development, and that can only be good for those most vulnerable of our tenants—the most vulnerable of our tenants—who are now reliant on the Government for emergency housing, for living in a motel, or for living in a Kāinga Ora home that isn’t even up to their own code yet, but not in a private landlord’s residence.

I think we can do better as a society. We need to solve the housing crisis. We need more warm, dry, and affordable housing. But it’s not through more taxes, more regulations, and more costs, but through allowing New Zealanders to get on and provide accommodation in the form that they want it to other New Zealanders. Thank you, Madam Speaker.

ANAHILA KANONGATA’A-SUISUIKI (Labour): Thank you, te Mana Whakawā. The name of the bill is Residential Tenancies (Healthy Homes Standards) Amendment Bill. Common sense told us in 2017—as a party, as a Government—that healthy homes standards are needed. Common sense is action; we put it into practice in 2017. COVID came along, so common sense was saying, “Give people another year to enable this Act.” I commend the Residential Tenancies (Healthy Homes Standards) Amendment Bill to the House. Mālō.

ASSISTANT SPEAKER (Hon Jacqui Dean): Order! Penny Simmonds—five-minute call.

PENNY SIMMONDS (National—Invercargill): Thank you, Madam Speaker. If we were an uncharitable lot, we would say that this Residential Tenancies (Healthy Homes Standards) Amendment Bill was a “get out of jail free” card for five years of failure by this Government. However, we are not so uncharitable; we are pragmatic people, and so we support this bill to help our valuable landlords. So I commend this bill to the House. Thank you, Madam Speaker.

ASSISTANT SPEAKER (Hon Jacqui Dean): Making a remote contribution for the Māori Party, Rawiri Waititi.

RAWIRI WAITITI (Co-Leader—Te Paati Māori) (remote): Tēnā koe e te Pīka. Tēnā koutou e te Whare. Well, I take this short call for a third reading speech on the Residential Tenancies (Healthy Homes Standards) Amendment Bill that’s being passed under urgency. Like I said last night in the first reading, this is a terrible bill. It is being passed only to let landlords at Kāinga Ora homes off the hook by giving them an extra year to comply with the healthy homes standards.

I want to open with a kōrero by the late Dr Moana Jackson—not the early Willie Jackson but the late Dr Moana Jackson. And I quote, “Māori have been homeless since 1840. Because Māori were deprived of the right to be at peace at home, the problem today is around houselessness. If we can solve the problem of houselessness, then we make it easier for people to feel at home. Part of the solution to houselessness is to remedy homelessness, which colonisation has caused, and the answer lies in Te Tiriti.”

What this bill sets out to do is keep house owners—and in particular Kāinga Ora, formerly known as Housing New Zealand—from ensuring that their tenants do not feel a right to feel at peace at home, to the point where they feel afraid to speak up or out about their Third World living conditions of their situation or run the risk of being kicked out, thus becoming houseless or even homeless. The reality is that more than 50 percent of Māori are renters. If the average house price is $850K and the bank requires a 20 percent deposit and interest rates for repayment of debt at 6 percent, how many Māori will be able to afford their own home? Hence the reason why many of our people are renters, and they have the right to immediately feel peace in a healthy home. But this bill does not do that. What it does is it gives Kāinga Ora and house owners the leeway to delay. This is a terrible bill.

We also know that Māori make up 50 percent of the social housing waiting list. Surely the Minister knows that the State subsidisation of the market rent, of $2.6 billion per annum, distorts the true state of social housing provision. How many private speculator dwellings are subsidised by the market rent subsidy? So it’s leeway and subsidies for the rich and the upper class, and it’s damp, cold, unhealthy homes for the most vulnerable whānau in our society. This bill should be called the “Leeway for the Government and Rich People (Double Standards) Bill”.

Let’s put another spin on this. Over 4,000 vulnerable whānau are living—not staying but living—at emergency addresses in motels; 1,000 of those are in my electorate, Waiariki, alone. Some have been there for over two years, going on three, with no end in sight. What accountability do the motels have, who are making millions of dollars of taxpayers’ money, to ensure their rooms are of a healthy home standard? Or is it money in the pocket and more leeway for the rich?

What this bill lacks is the ability to punish those who don’t get their houses up to healthy homes standard. In particular, the Government is passing under urgency the leeway to allow them another year to get houses to the healthy homes standards. There are no penalties of substance. I agree with the member last night who said it would be like getting slapped with a wet bus ticket whilst 30,000 tamariki will be hospitalised because they are living in unhealthy homes. Cold, damp, and rundown houses are literally killing our people. This is absolutely disgraceful.

Like I said in the first reading, these changes speak to the double standards that the State applies to those with power and wealth who don’t comply with the law and those without, as tangata whenua know too well. I reiterate that rather than further weakening protections with this bill, the Government should be strengthening the standards, which were watered-down to lobby the property class. We are strongly and wholeheartedly opposed to this legislation, and again call on this Government to withdraw it and do what’s right by renters in Aotearoa. Kia ora tātou.

TERISA NGOBI (Labour—Ōtaki): Thank you, Madam Speaker. This bill continues to support the Labour Government’s plan to support people. That includes tenants, that includes landlords, that includes our tradies, that includes our building sector, and that is what this bill does. We acknowledge the global supply chain issues due to COVID, and that’s why this extension’s in place. We want to make sure that everyone has a warm, healthy, dry space and place and whare to be in, and that’s what this Labour Government does. We continue to support the people of New Zealand.

Hon SCOTT SIMPSON (National—Coromandel): Well, thank you, Madam Speaker. I’ve been listening with intent to the debate on this piece of legislation—both this morning as the House sits in urgency, but also last night, as the midnight hour approached, and the debate has been proceeding at pace. So I just really wanted to confirm that, on this side of the House, we’re supporting this piece of legislation.

Dr ANAE NERU LEAVASA (Labour—Takanini): Fa’afetai lava, Madam Speaker. It’s a real opportunity to speak on this bill, and I thank the Minister for bringing it to the House and also for her answers to last night’s committee stage as well. I just want to acknowledge the work of our local healthy homes provider, Wati Waru, who represents the Auckland-wide Healthy Homes Initiative providers that do the work and that engage with our whānau, our private landlords and our private owners, and the work they do to provide insulation, ventilations, and so forth.

It is a huge job to try to protect our whānau. Healthy homes, healthy families, healthy tamariki—we lessen the issue of sore throats and rheumatic fever, skin conditions, and respiratory issues as well. That’s why we acknowledge the delay in materials, and that’s why I support this work to the House.

A party vote was called for on the question, That the Residential Tenancies (Healthy Homes Standards) Amendment Bill be now read a third time.

Ayes 107

New Zealand Labour 64; New Zealand National 33; ACT New Zealand 10.

Noes 12

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

Motion agreed to.

Bill read a third time.

Bills

Land Transport (Clean Vehicles) Amendment Bill (No 2)

First Reading

Hon Dr AYESHA VERRALL (Minister for COVID-19 Response) on behalf of the Minister of Transport: I present a legislative statement on the Land Transport (Clean Vehicles) Amendment Bill (No 2).

ASSISTANT SPEAKER (Hon Jacqui Dean): That legislative statement is published under the authority of the House and can be found on the Parliament website.

Hon Scott Simpson: Where’s Michael Wood? Where’s “Napoleon”?

ASSISTANT SPEAKER (Hon Jacqui Dean): Order! [Interruption] Order! Ayesha Verrall.

Hon Dr AYESHA VERRALL: I move, That the Land Transport (Clean Vehicles) Amendment Bill (No 2) be now read a first time.

On 22 February this year, the Land Transport (Clean Vehicles) Amendment Bill received the Royal assent. This amendment represented a major step towards decarbonising our transport system and our economy. The amendment established the clean vehicle standard, which requires vehicle importers to progressively reduce carbon dioxide emissions of the light vehicles, both new and used, that they bring into New Zealand. It does this by setting carbon dioxide targets which get more ambitious year by year. The standard is critical to reducing transport emissions because emissions from our light vehicle fleet are the single largest source of transport emissions. Emissions from road transport have also been New Zealand’s largest source of emissions.

One of the reasons for that is because, before we intervened, there was no legislative or regulatory leadership in the area of vehicle fuel efficiency and carbon dioxide emission reduction. Before the bill was passed, New Zealand was one of only three countries in the OECD, alongside Australia and Russia, that did not have a vehicle emissions standard. As a consequence, light vehicles entering our fleet are more emission intensive than most other developed countries.

There is clear evidence that in the absence of a regulated carbon dioxide emission standard, overseas vehicle manufacturers have not supplied the cleanest, most fuel-efficient vehicles. New Zealanders have paid, and are still paying, the cost for the lack of regulatory oversight in higher vehicle running costs. Vehicles with higher emissions burn more fuel and cost more at the pump.

We have moved quickly to establish the clean vehicle standard because it is a critical policy to transition our vehicle fleet to be low emission. It also lowers the cost of living because it lowers fuel bills. It was very clear that if we did not regulate in a world where countries focus on bringing cleaner cars into their fleets, we will become, even more than we are now, the dumping ground for the dirtiest vehicles in the world.

Hon David Bennett: Oh, that’s rubbish.

Hon Dr AYESHA VERRALL: It’s true.

Hon David Bennett: What a load of rubbish.

Hon Dr AYESHA VERRALL: It’s true. Already, we are seeing that the wider clean car programme is working well. Due to the Clean Car Discount, record numbers of electric vehicles and hybrids are being imported and bought by New Zealanders. The standard will reinforce the discount by improving the supply of low- and zero-emission vehicles, giving New Zealanders more choice in the variety of vehicles available.

Now, with this bill, we are moving to ensure the implementation of the standard is as successful as it can be. Key to that is making the commencement of the standard’s obligations as smooth as possible for the vehicle industry. To simplify compliance, the bill will provide a six-month phase-in. It will also exclude mopeds and motorcycles from the standard carbon dioxide account in reporting requirements.

The standard’s requirements start on 1 December 2022. From this date, all vehicle importers must hold a carbon dioxide account where the carbon dioxide emissions ratings of their vehicles will be recorded. Without this information, vehicles will not be able to complete entry to New Zealand and be registered. From 1 January 2023, the carbon dioxide emissions ratings of vehicles will start to count towards the achievement of carbon dioxide targets. For vehicle importers complying on a pay-as-you-go basis, each vehicle will incur a charge or a credit based on its carbon dioxide emissions. Credits can be used to offset charges or be transferred to other importers.

The bill provides a six-month phase-in that’ll defer, from 1 January 2023, the first requirement to pay charges to 1 June 2023. Charges will still be incurred from 1 January 2023, but will not be payable until 1 June 2023. Second, the ability to transfer emission credits from 1 June 2023. Credits will still be accrued from 1 January 2023. Third, the requirement for a publicly available record of account holders to apply from 1 June 2023. Between 1 December 2022 and 31 May 2023, importers and the public need to apply to Waka Kotahi to access information from the record of account holders. The purpose of these phase-ins is to give vehicle importers time to become accustomed to operating with the new requirements and online system run by Waka Kotahi. It makes it less likely—[Multiple members interject]

ASSISTANT SPEAKER (Hon Jacqui Dean): Order! That’s enough.

Hon Dr AYESHA VERRALL: —that vehicle importers are penalised by charges because they were unfamiliar with the requirements of the standard’s carbon dioxide emissions targets.

The bill also corrects the Ministry of Transport’s inadvertent inclusion of mopeds and motorcycles in part of the requirements of the standard. Without this change, importers of motorcycles and mopeds would need to unnecessarily hold carbon dioxide accounts and record emissions.

The amendments in this bill seek to make it easier for the vehicle industry to comply with the clean vehicle standard.

Hon David Bennett: What’s the bill called?

Hon Dr AYESHA VERRALL: Compliance is key to achieving emission reductions from the standard. I commend the Land Transport (Clean Vehicles) Amendment Bill (No 2) to the House.

ASSISTANT SPEAKER (Hon Jacqui Dean): The question is that the motion be agreed to.

SIMEON BROWN (National—Pakuranga): National will support this bill, but it’s a stuff-up by the Government—an absolute stuff-up that we’re here, again, this year, in Parliament, fixing legislation that this Government rushed through Parliament earlier this year, and it’s a clean car stuff-up. And I just want to congratulate Minister Verrall for her promotion as the “new Minister of Transport”, who managed to make it down to the House to read the speech and not to express any apology to the New Zealand taxpayer, to the car industry, or to the people who are being affected by this piece of legislation for this absolute stuff-up by the Government.

We were told that the Government was rushing the clean vehicle legislation through earlier this year; the industry told us that was what was happening. The regulatory impact assessment made it incredibly clear: one of the big issues was whether the New Zealand Transport Authority would be able to be set up in time; whether they would have the ability to be able to actually implement the legislation. This was told to us back at the time and we made it clear: this is being rushed. And now we’re here in Parliament fixing up their mistakes, because they on that side—with their woke virtue signalling—always talk about “It’s a climate emergency. We need to rush things through. We need to do it quickly.”, and here they come, down to Parliament, and they’re like, “Well, actually, we can’t implement it that fast, so we’re going to have to delay things—delay it by six months.”, and that’s exactly what they’re doing. This is a clean car stuff-up. If only this Government actually took a little bit more time to get the details right, we wouldn’t be wasting this Parliament’s time pushing legislation through in urgency to try and clean up their mistakes.

So this bill does a few things. The first thing is it delays the implementation of their Clean Car Standard, which, as we’ve already discussed, is something which should have been delayed right from the start, to give the agency time to actually get itself set up and do the work that was needed—and to allow the industry to be able to prepare for it, as it is a significant change; the Clean Car Standard is a significant change to how the clean car importation business works in New Zealand.

But the bill also exempts, now, motorcyclists, because, oops, motorcycle importers were not meant to be—this was the Clean Car Standard, not the clean motorcycle standard. But the legislation—and we raised this at the time as well, we made it clear that this is going to have unintended consequences. Lo and behold, no, we have to rush this through; we can’t take too much time. Well, here we are; we’re now making it clear that motorcycle importers were not meant to be included all the way along. So, oops, we’re back here to clarify the legislation for motorcyclists. But, again, it comes back to a Government which just rushes legislation through Parliament and expresses its woke virtue signalling to try to say that “We’re amazing; we’re doing all these things”.

But let’s just get back to the basics of what this legislation’s actually doing—it’s doing two things: it’s got the Clean Car Discount and it has the Clean Car Standard. And so the Government passed both of those pieces back in back in February. The Clean Car Discount “feebate” system—this is a reverse Robin Hood scheme by this Government, the Government which says they’re here to help low income, the party of workers. The party of workers has become the party supporting Elon Musk’s Tesla, because tens of millions of dollars have been taken off the working-class people in New Zealand through the “feebate” scheme and have been handed out to millionaires who can already afford their $75,000 Teslas—already afford to buy them—and who are now getting these discounts. The people of Ponsonby, Parnell, Remuera, and Wellington Central are getting millions of dollars in discounts for their Teslas, which are being paid for by the working-class people of New Zealand, who are working hard, trying to get ahead, and are being punished by this Government who does not care about them, who does not care about the hard-working people of New Zealand.

This is a Government that’s putting reverse Robin Hood policies in place: punishing the poor to pay the rich. It’s absolutely disgusting. Their heads are hanging in shame. How disgusting. They know how bad this is—they know how bad this is—and they know that voters out there in the real world will punish them for it at the next election. And the National Party will get rid of the Clean Car Discount “feebate” reverse Robin Hood scam.

But what we have said is we will support a Clean Car Standard. We do support delaying its implementation, because we do need to reduce emissions of vehicles coming into the country over time, but we do need to make sure that those standards are achievable; we do need to make sure that they’re implemented in an achievable way. What we know from the submissions was that where they’re currently set is not going to be achievable. It is going to put significant risk on the fact that there will not be the amount of vehicles needed to come into the country, the stock availability won’t be there, there aren’t the options around utes and those vehicles that are needed for our farmers and tradies. So there will need to be changes made to that standard, to make sure that New Zealanders can still get the vehicles they need for their work and the things that they do, whilst, at the same time, making sure that we do reduce the emissions of our fleets coming in over time, because the risk is—and this is the very real risk that this Government has now set up for New Zealand—talking to car importers, that they will not be able to get the supply that is needed, and so New Zealanders will hold on to their dirtier vehicles for longer, and that is going to mean that our emissions stay higher for longer. So that is the—they say it could be an unintended consequence—

Hon David Bennett: It was obvious.

SIMEON BROWN: —but that is—exactly: it’s an intended, obvious consequence with the standards set where they are currently set.

So there will be change needed. We will work with the industry, if we’re privileged enough to win the next election, to fix that issue to make sure that we reduce our emissions over time but that we are also able to make sure that New Zealanders can still get the access to the vehicles that they need and that we don’t end up with this issue of people holding on to dirtier vehicles for longer. It’s a very serious issue and we will fix it. We support this bill because it fixes their stuff-up—

Hon Member: We’re fixing the stuff-up.

SIMEON BROWN: We’re fixing their stuff-up, we’re supporting fixing their stuff-up, but they need to stop doing these stuff-ups, take time, listen to the industry, and actually get it right the first time.

SHANAN HALBERT (Labour—Northcote): Thank you, Madam Speaker. It’s my privilege to speak on the Land Transport (Clean Vehicles) Amendment Bill (No 2). I just want to acknowledge my Transport and Infrastructure Committee colleague Simeon Brown for his support on this particular bill. At the same time, I did note that he called this side of the House disgusting, and just ask that the member consider perhaps more respectable language in a professional sense within this wonderful House that we work within.

As the chair of the Transport and Infrastructure Committee, it’s important to me that we get this right—47 percent of our emissions in this country are made up of our transport fleet. In Tāmaki-makau-rau, Auckland, in particular, we need to ensure that we have better modes, better options, and better tools available to us. This particular bill amends the Land Transport Act 1998 to support the clean vehicle standards in Part 13: “The Standard sets annual targets that require light vehicle importers to progressively reduce the carbon dioxide emissions of the vehicles they import.”

Just going back to the transport spokesperson of the Opposition, last week I noted that his leader actually did a bit of a U-turn on this particular piece of work. He wasn’t sure at the time if he supported clean car standards, the clean car discounts, and my friend and colleague Simeon Brown had to tidy up his leader and get clear on what the Opposition is thinking in this particular space.

It is important that we continue the work of reducing emissions, responding to the climate change challenges that are in front of us. For us that are congested in Auckland, we need to ensure that we have alternative modes of public transport but also that the fleet that we bring into this country is the best quality and cleanest fleet that we can possibly have moving forward.

We’ve heard the request from the industry, in particular, for a delay and have worked together to confirm a time frame that strikes the right balance between a successful implementation and, at the same time, the need for particular action. So, without further ado, I’m really proud to commend this bill to the House.

Hon SCOTT SIMPSON (National—Coromandel): Thank you, Madam Speaker. Listening to the chair of the Transport and Infrastructure Committee, one would have thought that this was something that they had not been warned of previously. He said that they have been listening to the industry. Well, the industry was telling them that this piece of legislation was poorly timed, hopelessly inadequately prepared for, and would not be suitable for purpose. The industry was telling them, at the time, that this legislation, that the principal Act, was passed in a rushed, hurried way without the detail clear, and we warned them as well on this side of the House. And here we are now, in urgency, having to come back to this House, without the scrutiny and benefit of a select committee process, to correct and make good this clean car stuff-up of the Government’s.

Make no mistake, this is a retreat of Napoleonic proportions—literally Napoleonic proportions. Only someone with the grand planning of a Napoleon could have made such a massive tactical mistake. And I think that what will happen here—

Simon O’Connor: It’s like Russia all over again.

Hon SCOTT SIMPSON: Well, it is. My colleague Simon O’Connor says, “It is like Russia all over again.” Massive retreat, having made the grand statements, the grand visionary proclamations, and then thinking, “Oops, we got it wrong. We got it wrong.”

Hon Member: Is this a Waterloo moment?

Hon SCOTT SIMPSON: It’s a Waterloo moment. It’s a Waterloo moment for Napoleon. And, as I say, it’s a retreat of Napoleonic proportions.

So the original legislation was rushed. It was incomplete. It was against the advice of the sector and the industry. It included motorcycles, when it was never intended to include motorcycles. And, now, for the Government to have to pass this amending piece of legislation under urgency, without the scrutiny of a select committee process, without further input from the sector or from people who are affected, is an admission that they got it so horribly, horribly wrong.

So, notwithstanding all that, we’re going to support it because it’s the practical, prudent thing to do now that they are, if only belatedly, recognising the practical hurdles that the industry and the sector are going to have to overcome, let alone the unpreparedness of the New Zealand Transport Agency. They’ve got an army, a Napoleonic army - sized communications team—

Simon O’Connor: La Grande Armée!

Hon SCOTT SIMPSON: La Grande Armée of communications people—but they haven’t got, it seems, the people who can actually do the detail work in advising the Minister of Transport on the pitfalls of the piece of legislation originally, and, if they did advise the Minister, then the Minister clearly took no notice and pushed on regardless.

So we are going to support this piece of legislation. But, in doing so, I want to ask some of the same questions that my colleague Simeon Brown has asked. Where is the equity in providing free money in a reverse Robin Hood scheme that provides wealthy people, who do have choices about the kind of vehicle they drive, with free money, while, at the same time, taking from hard-working New Zealanders who have little choice and often little capacity to pay? Where is the equity for that? And colleagues on this side of the House were asking the question, where is the Labour Party of Mickey Savage? Where is the Labour Party of the workers? Where is the Labour Party of common, ordinary, hard-working New Zealanders? Well, these days, increasingly, those people, those hard-working, ordinary New Zealanders, they’re voting National. They’re voting National because they know that it’s National and the centre-right political side of this Parliament that has their back. It’s not the “Labour” Party any more. They want to imbue their friends, their small number of friends in Grey Lynn and Ponsonby and the leafy suburbs of Wellington with expensive Teslas. This piece of legislation could actually, probably, be renamed and recalled as the “Let’s Make Elon Even Richer” piece of legislation, because that’s, effectively, what it does.

So, on that thoughtful note, I’ll conclude my comments on the initial first reading debate of this bill, but we’ll come back and have another go at it during the second reading and the committee stages under urgency.

TERISA NGOBI (Labour—Ōtaki): Thank you, Madam Speaker. Always, it’s an honour and a privilege to take even a brief call on this bill, especially as a member of the Transport and Infrastructure Committee. Really good to hear our Opposition colleague on the transport committee Simeon Brown support the Clean Car Standard, and go the electric vehicles (EVs)! Nice work, Simeon Brown.

We know that we were the only country to not have a clean car standard, which, of course, meant that we became a dumping ground for dirty cars all around the world. Of course, the more dirty cars we imported, the more readily available and affordable they became. That’s not the case now. Even in that short period of time that this Labour Government put in the Clean Car Standard, we’ve already started to see an uptake in terms of people being able to afford EVs and hybrids.

My family is also one of those families that were able to purchase a hybrid. I would say “us”—we purchased it, but, actually, I had to get a loan from the bank, so the bank probably owns most of it, but we have one. What we did notice is the massive amounts of money it saves in our family budget in terms of our petrol. But, also, what that shows us is that the uptake is making EVs and hybrids more readily available and, therefore, more affordable as well. But we know that not only is this saving our budgets, it’s also saving Papatūānuku. So, for me, it’s a win-win.

This six-month phase-in responds to the concerns and the delivery and the time and the flexibility that we heard from our importers. We know our importers also want to make sure that they can make those EVs and hybrids readily available for our whānau but also to make sure that they are able to support us in lowering our emissions, and that’s what this phase-in does. Again, this is—I spoke earlier on another bill—the Labour Party or Labour Government’s plan of showing what we’re doing to support our people, what we’re doing to support climate change, and making sure that everyone has access to good, clean EVs and hybrids. So thank you again to Simeon Brown for supporting that initiative and supporting the Labour Government’s plan, and, for that, I commend the bill to the House.

Hon JULIE ANNE GENTER (Green): Tēnā koe, Madam Speaker. Responding to the climate crisis means giving New Zealanders options about moving around the country in lower-carbon ways, and that’s something that for decades has not happened. I was just conversing with my colleague over here Simon Court, who was a civil engineer before coming into Parliament—unfortunately, the decisions made by engineers and transport planners in the second half of the 20th century led to a situation where people only had the choice to rely on private cars. That means we have to buy many more cars, and that has a cost to New Zealanders of not having the money to do other things, and it excludes those who can’t drive, for whatever reason, from getting around.

So, anyway, the point is that there’s a huge opportunity here, that, right across the House, we could all agree on, which is providing people with more choices—low-carbon choices like frequent public transport, like safe walking and cycling and using e-bikes and e-scooters, and those things being all joined up. Of course, there will still be a need for cars for some journeys, and that’s where the Clean Car Standard and discount come in.

Now, New Zealanders have been disadvantaged for quite a while by not having fuel economy standards like almost every single OECD country. Indeed, they were intended to come in in 2008, 2009, but the then National Government’s Steven Joyce cancelled those fuel economy standards. As a consequence, New Zealanders have been paying more money on fuel than they needed to travel a given distance because we don’t have a competitive market. In the absence of fuel economy standards, the car companies and car manufacturers were sending us their least-efficient cars because they make more profit off those, because other jurisdictions had fuel economy standards and price incentives, and, therefore, New Zealanders were missing out on the choice of fuel-economic options when it comes to cars.

So the Clean Car Standard and discount together were our just ideal policies to change the type of vehicles that are provided to New Zealanders in a way that makes it easier for them to get more fuel-efficient cars. Even the most fuel-efficient utes, because there were double-cab utes, or single-cab utes that didn’t—work vehicles that wouldn’t have attracted a fee, but they weren’t being supplied to our market because we had no incentives and we had no standards. So how these policies work together is that you set a standard and you say that vehicle importers need to meet an average standard over time, and that means they look to bring in the more fuel-efficient models to meet the demand for those particular cars. They, of course, are still bringing in some that are above the average, which is the target, but they offset that with more low-emissions vehicles.

For second-hand vehicles, it’s not such an issue because Japan, which is the main market we import second-hand vehicles from—95 percent at least—has had very stringent and ambitious fuel economy standards. And so, in the absence of an age limit on the second-hand vehicles we’re importing, it is possible that we could be importing 20- or 30-year-old vehicles from Japan that were slightly polluting. But, the truth is, if you look at the second-hand market, the average fuel economy was much better than even the standard, so it’s not a huge negative impact at all on the second-hand vehicle market.

What was not coming down, in terms of fuel economy, were the brand new vehicles. That’s because of the proliferation of inefficient, gas-guzzling sports utility vehicles, double-cab utes, and Range Rovers. And, look, to be honest, the vast majority of those are being driven in the very suburbs that Simeon Brown was castigating earlier in his speech. I mean, they’re in the wealthiest suburbs. Why? Because the wealthiest people are the people who buy brand new vehicles—

Simon Court: Tow boats, they tow boats.

Hon JULIE ANNE GENTER: —and they tow boats, and they tow their jet skis—they need the double-cab utes for the jet skis.

So, far from being for work purposes, the reality is that these are lifestyle vehicles that are expensive. And that is why the Clean Car Discount is a fair policy, because it says we—so we’re going to import more fuel-efficient vehicles, but it was the industry itself which asked for the Clean Car Discount, and so I find it so interesting that the National Party members are saying, “Listen to the industry—listen to the industry.” The industry wanted the Clean Car Discount because they knew it would help them sell vehicles to achieve the fuel economy standards that were being brought in and the Clean Car Standard. And so, clearly, the National Party hasn’t been talking to the industry, because they have no clue that they want the Clean Car Discount.

The Clean Car Discount has been phenomenally successful. Because of these two policies working together, we have massively increased the fuel efficiency of the vehicles coming into New Zealand. That’s what we knew, that every country in the world that had increased fuel efficiency or reduced emissions from their fleet had done it through policies like this—a price incentive and a standard working together to just shift the balance of the vehicles that were coming into the market and, indeed, give people more choice.

That is the key thing. If you don’t have these policies, you’re actually reducing the option for New Zealanders to even be able to buy those fuel-efficient vehicles. I have some friends who are looking at a brand new electric vehicle (EV), and before the Clean Car Discount was announced, the importer—Hyundai, I believe—said, “Oh, there’s no way you’re going to get this. It’s a wait-list of at least six months.” And the day after the Clean Car Discount was announced, they rang them up and said, “We’re going to be getting a bunch of these in.” So the reality is: these policies aren’t just about influencing the choices of New Zealanders; they’re influencing the vehicles they can choose from. So it helps improve the market for fuel-efficient vehicles.

So, as I said, New Zealanders have been disadvantaged by a lack of fuel economy standards—this is down to decisions by the National Government in 2009. The cars sold here use more petrol and diesel to drive the same distance as cars sold in the UK or Japan. It means we have higher emissions. We spend more money importing oil, which is bad for our economy, really. The Clean Car Standard and discount have started to change this, but we should be accelerating change, because the reality is that Aotearoa New Zealand is way behind in this space and we’re not really doing anything ambitious at all to reduce emissions from agriculture. Certainly, the National Party wouldn’t change that; they would slow it down even more. So we have to do it in transport.

I’m sorry to say that, despite some marginal increases in investment in rail to keep it from completely falling over, there’s been no substantial investment that would create a step change in people’s ability to use public transport or rail to get around the country. And that’s because, sadly, the Labour majority Government is still spending the vast majority of money on a few urban motorways, just like that the last National Government would have done—it’s slightly worse, to be honest. Of course, that’s going to make traffic worse; it’s not going to make it possible for people to get around not using a car. So the one thing we could be doing is bringing in the Clean Car Standard on time. So the Green Party won’t be supporting this bill because it delays the implementation of the Clean Car Standard.

I just want to note that, of course, everywhere the efficiency standards have been brought in—whether it’s for buildings or for vehicles—the industry always pushes back. That’s just what they do. They’ll see how far they can go to avoid complying. And, ultimately, most other Governments bring it in and things don’t fall over; it works perfectly fine, because when there’s a will, there’s a way. But if they can push back and delay, they will. And if every industry keeps pushing back against climate action—like the farming sector, like the vehicle sector—then we are not going to make the changes that we need to make. What’s the consequence of that? Well, we’re going to have a destabilised climate that is going to be bad for everyone. It’s not like a choice that we have either the environment or the economy—you know, if we have an unstable climate, if we have worsening conditions for growing food, if we have droughts or floods, all of that, it’s going to come back to human wellbeing and it’s going to be a negative impact. So that makes it harder to trade; it makes it harder for us to live good lives.

The whole point of the economy is simply a system of trade, and that’s part of what we rely on to make sure that people have what they need. But, right now, it’s not working for everyone. The economy is not working for many people. It’s just being abused by those who already have a lot of power and wealth to get even more power and wealth. To what end? It’s unclear, because money in the bank account isn’t going to mean anything if we don’t have food, clean water, and a stable climate in which we can raise our children and live good lives.

Simon Court: But, with enough money, you can build a decent bunker!

Hon JULIE ANNE GENTER: Oh, all right, yeah. So there’s the plan for the really rich people: they’re going to build bunkers. But that’s really not going to help them if they don’t have access to food and water.

So the Green Party won’t be supporting this bill. The Clean Car Standard and discount are excellent, evidence-based policies that are already making a difference. And, quite to the contrary of what the National Party says, it is the wealthiest New Zealanders who buy Range Rovers, who are paying the fees that lead to the rebates on the moderately priced EVs.

SIMON COURT (ACT): Thank you, Madam Speaker. Look, the ACT Party won’t be supporting this bill, but not because we don’t share the concerns of the industry, who have said, “Look, this bill’s not ready; the regulations aren’t ready to implement. The New Zealand Transport Agency has had to hire 80 more pen-pushers to try to do manual processing.” We really appreciate the fact that the industry was going to have to start complying and paying a fee on new vehicles and used vehicles arriving on the wharf from 1 January. I mean, who in their right mind would pass a piece of legislation that forces an entire industry to prepare for and report on compliance on 1 January? Doesn’t the Minister of Transport know that New Zealand shuts down and has a Christmas holiday for just a few weeks a year?

Before we get into the real problems with the piece of primary legislation and this amendment, I just want to respond to the member the Hon Julie Anne Genter. I understand it was one of her thought bubbles that led to this piece of legislation in the first place. Julie Anne Genter described some of the problems that have caused climate change. She said that civil engineers caused climate change because of our need to build roads and our need to build things, apparently, out of concrete and steel and non-renewable materials, and she said that if you build roads, you’ll make the traffic worse. Well, I’ve got a different perspective to the Green Party’s Julie Anne Genter, and probably quite a different perspective to the current Minister of Transport, Michael Wood, who’s just joined us here in the House to hear what ACT thinks. Thank you, Minister Wood, for joining us.

Now, let’s just address traffic congestion first. What causes climate emissions? It’s sitting in traffic, being stuck in traffic, for up to five days a year, for Aucklanders—just waiting at the lights, stuck in traffic, instead of moving at the posted road speed. Now, that’s bound to cause more emissions than just driving your vehicle at an efficient speed and getting to your destination on time.

The Green member the Hon Julie Anne Genter said that building roads makes traffic worse. Well, I want to offer a perspective on that. Near where I live in West Auckland, there’s a little town called Kumeū, and it’s a lovely little town. It’s on State Highway 16. About 20 years ago, the council at the time—and, since then, the new Auckland Council—zoned that area of Auckland to take tens of thousands of homes. Since then, about 12,000 have been built—since about 2007—and that means about 30,000 people have moved to the area. Now, on State Highway 16, between Kumeū and the north-western motorway, they have 36,000 vehicles a day using what is primarily a two-lane, rural road. That’s a 45-minute journey which should be a 10-minute journey. There are 36,000 vehicles a day crammed into a two-lane, rural road, and 36,000 vehicles a day is the number of vehicles that pass through the Takanini interchange, which is six lanes wide, on State Highway 1.

So when the member Julie Anne Genter—and, no doubt, Minister Michael Wood will stand up to defend his transport policy at some point—says that building roads isn’t the answer, well, tell that to the people of Auckland, who have responded logically. Where councils have zoned for people to live and they’ve bought homes there and they live there, it’s a surprise to them when a Government or its support partner, the Greens, say that building roads isn’t the answer. Frankly, they thought that the road would be delivered, because that’s where the zoning said that they should live. So there’s another issue there, which is the fundamental disconnect between urban planning and infrastructure provision.

Now, I want to come to the major problems with this bill. The bill, apparently, is going to help us meet our climate targets. The Clean Car Discount is a separate piece of legislation which taxes utes and vans and people who want to buy petrol and diesel vehicles, and it then gives a subsidy to those who would prefer to buy and can afford to pay some extra money to buy an electric vehicle or a low-emissions vehicle like a Tesla.

Now, it seems remarkable that a Government that purports to support the lowest-income people and to stand up for the workers—as well as being the Minister of Transport, he’s also the Minister of Immigration and Minister for Workplace Relations and Safety who has introduced the fair pay agreements to the House and is so proud of all his achievements in standing up for workers. He doesn’t seem to think that applying an additional tax on people who have large families and who need to buy a larger petrol or diesel vehicle, tradies who need to take the tools to the job site, or courier drivers and other people who need to buy a Toyota Hiace van or something similar—by taxing them, it might be at odds with all of this Government’s stated position on how much they care for working people. I think we know that they don’t really care, Minister.

Then I want to come to some of the other problems with this policy in the bill. There’s no point in having any policies that cost the taxpayer and consumers money to reduce climate emissions when all the emissions are already capped under the emissions trading scheme. The Minister knows that this doesn’t reduce emissions any more than they would be reduced by paying an emissions trading scheme charge and paying for your carbon, and every Kiwi who fills up at the pump with petrol or diesel currently pays 20c a litre for their emissions. This policy doesn’t reduce emissions at all.

Then we come to the problems with the bill. Well, when the car manufacturers came to select committee, they told the Labour, Green, National, and ACT MPs sitting on the Transport and Infrastructure Committee that it didn’t matter a darn if this Government taxed utes and vans arriving on the wharf, if they applied a clean car standard and a clean car discount, because not a single extra electric vehicle would be manufactured in a factory in Europe, Japan, South-east Asia, or Korea because of this policy. The car companies that make cars have a production line that is maxed out, and it doesn’t matter whether New Zealand taxes utes, subsidises Teslas, or taxes new or used vehicles arriving at the wharf, because there is no factory in Japan, South Korea, or Europe that’s going to make a single extra car that will have the effect of reducing global emissions because of this policy.

This is bad policy, and that’s why ACT doesn’t support the primary legislation and it’s why, even though we feel very strongly that the motor vehicle importers, new and used, have been hard-done-by by the provisions of this legislation, which requires them to start taxing vehicles as they arrive at the wharf on 1 January—they’ve been hard-done-by. We won’t be able to support this amendment, because we think that the bill and the presumptions behind the bill are absolutely flawed.

So then people say, “Well, what would ACT do? Does ACT care about the climate and does ACT care about emissions in the environment?” Well, of course we do. I trained as an environmental scientist because I cared about the climate, and I wanted to make sure that, in the work that I did and the companies that I worked for, we protected and enhanced the environment.

I’ve got children. I care about intergenerational issues. I want them to enjoy the same kinds of experiences in the environment—

Shanan Halbert: Just not willing to do anything about it.

SIMON COURT: —whether it’s hunting, whether it’s swimming at the beach, or whether it’s being able to dig in the garden and plant fruit and vegetables, knowing that the site is not contaminated. That’s what I want for my children.

You say, “What would ACT do about climate change—what would ACT do?” Well, we say that the emissions trading scheme is the way to price emissions, and, if you have a cap on emissions, no other policy is necessary. The $1.5 million to $2 million that’s collected under the emissions trading scheme from people who put diesel in the ute, from people who put diesel in the truck and in the digger, and from people who fuel up their petrol-powered vehicles, like my Subaru Outback—we pay for our emissions every time we fill up and drive.

ACT says the emissions trading scheme is the best way to incentivise people to use less fuel and reduce their emissions because it puts a price on emissions. But because climate change is a global issue, we would also modify the emissions trading scheme to allow New Zealand businesses—people who emit carbon—to engage with other countries and businesses and communities in other countries to actually reduce emissions in their country. Imagine being able to restore mangroves or restore a forest where orang-utans live, claiming the carbon credits, and actually enhance global biodiversity. That’s ACT’s climate policy.

ASSISTANT SPEAKER (Barbara Kuriger): Thank you, Mr Court.

HELEN WHITE (Labour): Thank you. It’s a pleasure to take a call on this bill, the Land Transport (Clean Vehicles) Amendment Bill (No 2). I was one of the people who was quite sceptical at the beginning of this legislation and became increasing persuaded that it was the right way to go. And it has proved utterly successful. Just for people out there who are trying to get their heads around this, this is about moving the fleet from one that is dirty to one that is clean. So it’s not about the first owner of the car; it’s about the rest of us who usually buy second-hand vehicles. It means that, over time, we will actually have an option we never had before. And that’s incredibly important if you live in the outer suburbs of Auckland, because, at the moment, we have not got enough mass transport, and those people need to be able to move around, and those are the families, those are the workers, and they need those vehicles, and this is their way in.

This scheme has been incredibly successful. There is obviously a balance to be struck, which is making sure that we are being fair on everyone in terms of how we implement this. This makes three minor changes to a situation where I don’t think anybody in New Zealand is going to regret this decision, because we are going to have a cleaner fleet that is better for our air and that is better for our missions—that is substantial change in our society. We need these vehicles. I am pleased to support this bill.

SAM UFFINDELL (National—Tauranga): Thank you, Madam Speaker. As we have noted, we are going to support this bill. We’re standing up here to talk on the amendment to the stuff-up that was made. It’s completely unnecessary. We’ve got an urgency week, and here we are, rushing through, cleaning up Labour’s mess. I don’t know how we managed to include motorbikes and mopeds on this, but we did, and that’s what happens when you generally don’t consult or listen to the feedback.

I do support the general provision that we want to bring cleaner cars into New Zealand, and I think that’s the right way to be going about it. We probably should’ve listened a bit more about when we wanted to implement that starting date. I take note of my colleague Simeon Brown, who made some excellent points about the reverse Robin Hood scheme. The way this Government thinks that your ordinary Kiwi out there can just go out and buy an electric vehicle (EV) is completely ridiculous. The only people who are buying EVs are highly privileged people living in leafy inner city suburbs. Your normal Kiwi is not going to buy an EV.

That’s my problem with the Labour Party, that you guys have forgotten your roots. You’re not the party of the working-class people anymore. If you go out there and you talk to small-business owners, they can’t stand you guys because you’re completely out of touch with them.

Hon Scott Simpson: Just playing to the privileged elite.

SAM UFFINDELL: Just playing to the privileged elite—that’s right, the Hon Scott Simpson. But, hopefully, they get a good message next year. I think the people of Northcote will be looking at how they’re being represented by this Government.

Hon Scott Simpson: The people in Northcote are looking for change.

SAM UFFINDELL: They are looking for change, and we’re here changing this today because we are fixing this stuff-up. We are hoping that we do lower our emissions, but I also think it’s important to note that there were some comments made—that what this may do is mean that people hold on to dirtier vehicles for longer, and that feedback probably should’ve been taken on board a little bit more.

I’d also reiterate the fact that there are no EV alternatives for farmers out there. I’m from Tauranga. We have a very heavy horticulture scene. I see a lot of people driving utes; there’s a lot of tradies in our part of town, and there is no EV option. So you are punishing working-class Kiwis to give to privileged New Zealanders, and that, as Simeon Brown has said, is a reverse Robin Hood scheme. Nevertheless, we will support this amendment to clean up Labour’s stuff-up. National supports this bill.

ASSISTANT SPEAKER (Barbara Kuriger): Ginny Andersen—five-minute split call.

GINNY ANDERSEN (Labour—Hutt South): Thank you very much, Madam Speaker. It’s always great to have a lecture from the privileged elite about the privileged elite! So thank you for all those tips on how to reconnect with the working class! I’ll take them all to heart!

The Land Transport (Clean Vehicles) Amendment Bill (No 2) helps smooth the implementation of the Clean Car Standard by providing a six-month phase-in to the standards requirements for importers. It’s a transitional measure, and it’s important that we do that. It’s excluding motorcycles and mopeds from the standard’s carbon dioxide account and reporting requirements, to correct the previous speaker. We support this bill because the amendments assist the successful implementation of the Clean Car Standard and they will make it easier for both vehicle importers and also those who want to purchase a cleaner car to comply and reduce compliance costs. A smooth implementation of the Clean Car Standard makes it easier for the vehicle industry to comply with the standard and it’s also key to achieving our emission reductions from the standard.

The clean car vehicle import standard will mean more climate-friendly cars are available and millions in tonnes of emissions will be prevented. It will give those families better access to electric vehicles, with an estimated saving of around $7,000 over the average life of a vehicle, which is a big deal for a family. Look, I’m looking forward to seeing more New Zealanders take up the opportunity of switching to electric. I know there are a number of benefits for that, for not just economies on a week-to-week basis through saving on fuel but also by making sure that we’re doing the right thing for the environment. I commend it to the House.

IBRAHIM OMER (Labour): Thank you, Madam Speaker. We’ve heard a lot about working people today from the National Party. It’s quite rich coming from the party that vote against every single policy that was designed to help working people—minimum wage, sick leave, and fair pay agreements. None the less, I rise to take a short call on the Land Transport (Clean Vehicles) Amendment Bill (No 2).

We know that car emissions are a major source of pollution, and unless we do something and act now, it will be too late. Every single step, every single action we take now, is going to help in the long term, and this scheme is all about lowering carbon dioxide emissions by encouraging a greater supply of low- and no-emission vehicle imports to New Zealand.

This is a good bill and I commend the Minister of Transport for bringing it to the House. I am on the Transport and Infrastructure Committee, which did some work on this issue. This is a good bill. It’s a good day. I commend it to the House.

Hon DAVID BENNETT (National): Thank you, Madam Speaker. I’m glad that member Ibrahim Omer just mentioned the Transport and Infrastructure Committee, because, when we had the select committee hearing on this bill, we had numerous submissions saying that it’s not going to work; it can’t be done. That was what the submitters actually said, “The time frames will not work.” The Minister of Transport came into the committee and deliberately overrode those submissions and said, “We’re doing it now, we have to do it now. We will make it work.” That was the Minister’s exact attitude to the submitters. He ignored them. He said, “No, we know better. We’ll get it done now.” This Minister has failed completely in everything in transport. He has failed in this area where he overrode the submitters. He has failed in his walking and cycling bridge across the harbour, which is one of the greatest failures in New Zealand political history. He’s failed in cancelling all the roading projects of significance, and then having to rebuild them. He’s failed in his electric transport options for Auckland around light rail. He’s failed in having speed limits of 70 kilometres or lower throughout the country. He is a failure and this is a failure.

The other thing the submitters said—and this is what everybody here needs to understand—is that we are in the Japanese car market. We are not in the European car market. The European car market makes electric vehicles (EVs); the Japanese car market makes hybrids. In the Japanese-Australian car market, the approach has been to reduce the emissions of the vehicle by the use of hybrids and better energy sources; it is not through the use of EVs. There’s only 200,000 EVs in the whole of Japan, and that’s where we get our vehicles. So when the Government talks about looking after low- and middle-income New Zealanders and making a change in our transport emissions, remember we are not in an EV market; we are in a hybrid market—that is, the New Zealand and Australian car makers. That was the other fundamental thing that the Minister ignored when all the car companies said that to him. He said, “No, no, no, we’ll go for the EVs.” And they’ll go on and say, “Oh, look how many Teslas have come into the country in the last year.” Well, OK, there has been an increase, but it’s a very small proportion of the actual cars that come in the country. And the reason you’ve had an increase is because you have given a tax deduction on it for people that can spend over 70 grand, which are wealthy people in New Zealand. The actual real change, if you were looking at doing something about the climate in New Zealand, is looking at the Japanese-Australian car market, where 90 percent of the cars that come into the country are from, and that car market it is not an EV market; it is a hybrid market.

Hon Michael Wood: You actually don’t know how this works.

Hon DAVID BENNETT: I do know how this works, because that’s exactly what the submitters said. The Minister says—he doesn’t know how it works. The Minister overrode the submitters and said he knew better. And six months later, we’re in the House doing exactly what the submitters said. I know what happened in that committee: the Minister was arrogant and overrode the submitters. He’s being arrogant again here today and saying people don’t know how it works. So we’re not—

Hon Michael Wood: No, no. Just the member—just the member doesn’t know how it works.

Hon DAVID BENNETT: Answer this, answer me this, Minister: are we in the Japanese-Australian car market for our manufacture of vehicles? Answer that.

Hon Michael Wood: Yes, and those vehicles are—

Hon DAVID BENNETT: Yes. We are. I don’t know what I’m talking about! How many EVs are there in Japan, Minister? How many EVs in Japan? Answer the question.

ASSISTANT SPEAKER (Barbara Kuriger): Let’s save the questions for committee stage. Debate is fine, but no questions please, Mr Bennett.

Hon DAVID BENNETT: The arrogance of the Minister to come into here and to say that we don’t understand. I asked him the one fundamental question that is about this bill and he said I was right. So, Minister, stand up and take a call. Don’t get some junior Minister to come in and take your call because you don’t want to have your name on this bill; actually come in here and do your job and admit your failings, because you are the worst transport Minister ever. That has been shown time and time again and today is another example.

RACHEL BROOKING (Labour): Thank you. I rise as the owner of a second-hand Japanese electric vehicle (EV). As a person living in Dunedin, Dunedin is full of these Nissan Leafs—all second-hand Japanese full EV imports. In response to one of the first National speakers—Simeon Brown—I’m very concerned about what I am hearing from National about using terms like “woke virtue signalling” in regards to climate change. Climate change is real. It affects us all—poor, wealthy, rural, everyone in New Zealand. We need to act on climate change, and that is what both the Clean Car Standard and Clean Car Discount schemes do. This Land Transport (Clean Vehicles) Amendment Bill (No 2) is going to help that. I commend it to the House.

A party vote was called for on the question, That the Land Transport (Clean Vehicles) Amendment Bill (No 2) be now read a first time.

Ayes 97

New Zealand Labour 64; New Zealand National 33.

Noes 20

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

Motion agreed to.

Bill read a first time.

Second Reading

Hon MICHAEL WOOD (Minister of Transport): I move, That the Land Transport (Clean Vehicles) Amendment Bill (No 2) be now read a second time.

Thursdays at Parliament are well-known by all members as being “Doughnut Day”, the day on which doughnuts are available for all to enjoy at Copperfields. I am very, very pleased to hear that the spirit of “Doughnut Day” has spread to the House, as expressed by members of the Opposition in their new-found support for the Clean Car Standard. I do commend members for that and for the clarity that they have provided in that respect, given the utter lack of clarity we experienced last week when the Leader of the Opposition got into the position of having to speak about the National Party’s policies in respect of the clean car package. We heard that they supported the Clean Car Discount, and then we heard that they didn’t. We heard that they supported the Clean Car Standard, and then we heard they might have supported a clean car standard. So it is somewhat useful, I think, for the House to get clarity from the National Party, today, that they do in fact support this piece of legislation and the Clean Car Standard coming into effect.

It is an important piece of legislation, because this is a House which has declared a climate emergency. This is a House which has voted for the Climate Change Response (Zero Carbon) Amendment Act. This is a House which has established the independent Climate Change Commission and said that we need to get to net zero by 2050. Having done all of those things, it behoves this House and it behoves members of this House to actually do something to get us to that point of substantially reducing our carbon emissions. No member of this House can stand with credibility and say that they support a net zero New Zealand and say that they support emissions abatements without actually having policies to do anything about it.

The thing about the Clean Car Standard is that it is one of the most impactful policies that has ever been brought to this House to reduce emissions in a substantial way. I encourage all members who do take the time to speak on this bill in the debate to go back and read the regulatory impact statement, which was prepared at the time of the primary legislation and confirms that this policy will reduce over 1 megatonne—that is over 1.07 million tonnes—of carbon dioxide emissions in New Zealand by 2050.

And what’s more—and this is an important point, given the crocodile tears and pearl clutching that we’ve heard from the other side of the House in respect of their new-found care for the low-income people of New Zealand—this is a policy, which according to the regulatory impact statement, has its biggest impact on vehicle consumers because it lowers the cost, for Kiwis, of running their vehicles. What’s more, it confirms that the distributional impact—that is the impact on the lowest-income New Zealanders—is a positive one, and I’ll read directly from the regulatory impact statement for the benefit of those members who clearly haven’t and for the benefit of the record in the House. This isn’t the Government speaking; this is a regulatory impact statement from officials: “As we consider the risk of vehicle price rises to be low, we also consider that it will have little negative distributional impact. In fact, long-term evidence from the United States over the period of 1984 to 2014 suggests that the households that benefit the most from carbon dioxide standards, vehicle fuel-efficiency standards, are low-income households. This is because, as a percentage of incomes, savings from improved fuel efficiency are highest for households with lower incomes.” This is not only a policy which is good for our environment and that will lead to a significant abatement in emissions and a real impact on climate change; it is a policy that gives Kiwi consumers more choice, more access to clean vehicles, and more access to clean vehicles at a low price.

I must comment on the most recent speech from the Opposition that we heard at the end of the first reading from the Hon David Bennett. It was once said in this House that “His brains could revolve inside a peanut shell for a thousand years without touching the sides.” Well, the Hon David Bennett did an insult to a peanut in the speech that he gave at the end of his comments, and here is the point: I encourage the members opposite, before they speak on this bill and this policy, to actually understand how it works. That member devoted nearly all of his speech, as other members have opposite, to an obsession with electric vehicles (EVs). Do they not understand that the Clean Car Standard does not just apply to EVs, and that the Clean Car Discount does not just apply to EVs, that both policies pivot around a carbon dioxide emissions standard, that in fact the Clean Car Standard—in respect of the ability for importers to claim credits, not to have, necessarily, rebates—applies to hybrids, and that in fact the top-selling vehicles under the Clean Car Discount are used Japanese imported vehicles? The member, David Bennett, stood up in this House and didn’t seem to be aware of that. He pivoted his entire speech and entire critique of this policy around the fact that, supposedly, it didn’t take account of the fact that most imported vehicles in New Zealand come from Japan where hybrids are the pathway they’ve chosen rather than EVs. The policy does. Both the Clean Car Standard and the Clean Car Discount provide rebates for importers who bring in hybrids, and the biggest-selling vehicles under the discount policy have been Japanese hybrids. So, once again, I ask members opposite who are in a state of flux, given the flip-flops that we have seen on this policy over the last week, to actually understand the policies that they are talking about and that they are debating.

Having said that, I do welcome the most recent change, the most recent doughnut, and the support from the National Party for this policy. Ultimately, it is common sense, and it is a good thing if we can move towards greater support for policies that have a definable impact on emissions reductions in New Zealand.

This bill is a pragmatic one. It is important to note that it actually does nothing to delay the outcomes of the Clean Car Standard. The standard applies from 1 January, and rebates and charges apply from 1 January. There is simply for category 2 importers, who probably import a minority of the vehicles into the country, a delayed implementation of when the charges will apply from and when rebates can be traded from 1 June. So for the benefit of the House, there is, therefore, no reduction in the abatement benefits that we get from this policy and no reduction in terms of the choice benefits that consumers will get.

In fact, one of the things that importers tell me is that even though this policy doesn’t come into effect from the beginning of this year, it is already doing what it was intended to do, which is giving New Zealand importers more ability to go to their head offices and get the stock of cleaner vehicles that Kiwi consumers actually want. Before this policy came into effect, New Zealand was one of only three countries in the world without a carbon dioxide emissions standard—the other two being Australia and Russia. And I’d say, “Watch out”, because I think Australia’s likely to move in this direction in the coming years as well. And because of that, we were becoming a dumping ground for the world’s dirtiest vehicles. Other countries had a standard in place which meant that their importers could go to their head offices in Japan, Korea, or Europe and require the stock of clean vehicles that they needed for their market. In New Zealand, because there was no standard, we were getting dirtier vehicles than other countries were getting. Importers tell me now that having the standard in place, as they put in their forward orders for 2023 and 2024, means that they can negotiate more effectively with their head offices to be able to get that supply of clean vehicles, which is good for our environment, gives Kiwi consumers choices, and will actually lower costs of vehicle ownership to Kiwi consumers as well. So it is good news all round.

As I’ve said, our Government has brought forward this piece of legislation to make sure that the legislation can be implemented as smoothly as possible. The Opposition seems to think, on one hand, that Governments should listen to sectors that they work with, and, on the other hand, is critical of a Government that does actually listen and does work pragmatically to bring in significant policy. The real reason, in the end, that the Opposition and the spokesperson who might get to his feet in a moment wants to focus on that is that they want to do anything possible not to actually debate how we reduce emissions in the transport sector, because they are opposed to virtually everything that we do in that area—they are the new form of climate deniers; they mouth the words about wanting to reduce emissions and then oppose virtually every policy that will actually do anything—and, secondly, they want cover the tracks of the past couple of weeks when they have flip-flopped three or four times on this policy and have had total chaos within their ranks.

This is a practical bill that will support emissions reductions and will support better choices for Kiwi consumers and the vehicles that they buy. It will support the smooth implementation of that policy, and I commend it to the House.

ASSISTANT SPEAKER (Barbara Kuriger): The question is that the motion be agreed to.

SIMEON BROWN (National—Pakuranga): This Minister of Transport is the worst Minister of Transport New Zealand has ever seen, and that was just an absolutely appalling speech. He still can’t even answer the question: why are we here debating this legislation today? It’s because he stuffed things up. He stuffed up the implementation of the Clean Car Standard. He stuffed up the legislation when it came to the House back at the beginning of this year, and now we are here fixing up the mess he created because he didn’t listen to the submissions and he didn’t listen to the advice. So we’re here again passing legislation to fix up his stuff-ups.

The river of insults that comes from his mouth to people who dare to disagree with him is absolutely disgusting—insults from someone who’s ruined businesses up and down this country with his immigration policies. It’s absolutely appalling from the Minister of Transport.

The National Party will support the Government in cleaning up its mess. But we also make the very clear point that there is more mess that needs to be cleaned up in regards to this standard. The standard is something we do support, but we don’t support where the standard currently sits. If you read Newsroom, Toyota have just announced that they will not be supplying new utes to the police. That is something that people might say is a good thing over on the greenie side of the House—less utes coming in—but this is emblematic of a Government that put in policies that have unintended consequences, or intended consequences, which are now going to make it harder not only for our famers and our tradies but also for our police who won’t get the vehicles they need.

That’s why, whilst we support a standard, we don’t support where the emissions standards currently sit, because it is going to punish those people who currently don’t have a choice for the vehicles they need. I quote from this article in Newsroom, where the Inspector Brian Yanko says, “If we were to suffer, God forbid, another Christchurch or Kaikoura-type earthquake …, we will have to be able to respond. We don’t want our fleet incapacitated within 24 hours and staff being grounded—we need to still be able to respond even in those circumstances.” So what this Government is doing with where they have set the standard is they are putting the ability for our police in New Zealand to be able to respond to significant events which happen in our country from time to time—they may not have the ability to respond because they will not necessarily have the vehicles that they need to be able to get to those places. That is something which is incredibly concerning for New Zealanders, and that is what is going to happen if the standard stays where it is.

So it’s good news that the Government is slightly delaying the implementation of the standard. It’s good news that they are removing motorcycle importers, who were never meant to be in it. It’s the Clean Car Standard—it’s not the clean motorbike standard. But, oops, they put the motorbikes in there, intentionally or unintentionally, and now they’re removing them—again, finally. But this is a stuff-up and we’re telling the Government that this is only going to cause havoc because some sectors of our country don’t have the alternative vehicles. The standard, where it is set at the moment, is going to make it impossible for them to get the vehicles they need, and that, as we see from that example with the New Zealand Police, is going to be incredibly concerning. It will need to be fixed and we will fix it.

SHANAN HALBERT (Labour—Northcote): Thank you, Madam Speaker. You know, I feel sad, some days, for my friend and colleague Simeon Brown and his view of the world. Some would say, “all steam, no hāngī”; some would say, “bark and bite”, but the reality is National needs to explain to this country how they are going to reduce emissions. That is the important thing, because by all means criticise the Government, challenge us to do better, but the reality is we’ve all got to front up with policies and initiatives, ideas, but most of all action on how we are going to reduce emissions.

We saw the U-turn last week: Christopher Luxon wasn’t clear on National’s position, whether they supported the Clean Car Standard or the Clean Car Discount or what that was, and my friend and colleague Simeon Brown had to step in and support him to get their position clear. But, again, National needs to be very clear with the New Zealand public on what their ideas are, what their action is on reducing emissions in this country.

When it comes to the Clean Car Discount, it’s very clear on the progress of this particular bill. In 2014, there were fewer than 100 electric vehicles on the road. By 2018, 4,123 were in this country, and, in the first nine months of 2022, that number shot up to 13,000—there was that spike from 4,000 up to 13,000. The goal of this is to clean up our fleet in New Zealand. Yes, it starts with those people who can afford to buy new vehicles—who can afford to buy new vehicles—and, of course, as they are traded out to second-hand, third-hand, the goal here is to clean up our fleet. That will take time; we have to start somewhere, but, most importantly, people need to understand that in transport, it’s not about one initiative. We’ve got to have a number of tools, a number of solutions on how we are going to reduce emissions and how we are going to decongest our roads. I commend this bill to the House.

Hon SCOTT SIMPSON (National—Coromandel): Thank you, Madam Speaker. Well the current and soon not-to-be, I suspect, member for Northcote really needs to understand that it is his party that is currently in Government. It is his party that has the current privilege of deciding policy and policy direction. It is the Opposition’s role to critique and criticise and point out the failings of their legislative and policy agenda. It is full of holes. That’s why we are here today in urgency, passing and amending a piece of legislation without the scrutiny of a select committee process to fix up a stuff-up made by the Minister of Transport who is also the Minister of Immigration and has become the most notoriously inept Minister in the Labour Government’s administration. The person who will almost single-handedly be the cause of so many of those Labour backbenchers leaving and exiting this Parliament at the next general election because of his inept, his arrogant, and his “I know best” approach to everything that clearly does not work. That’s why we are here, because we are fixing up a mistake of his that is of Napoleonic proportion. When the principle legislation was first introduced, he was advised and warned not only just by us here in the Opposition but by the sector and the industry themselves, that what he was imposing upon them was unworkable, that the time frames were too tight, and that there would be perverse outcomes as a result of his arrogant, stubborn determination to push on with his ideological approach that bears no resemblance to pragmatic and practical approaches that exist in reality.

Now, on “Planet Labour”—we know that on “Planet Labour” they operate in a little hermetically-sealed bubble of self-congratulation, self-affirmation, and self-supporting. They don’t mix with ordinary New Zealanders; they don’t understand how the economy works. They have no regard these days at all for their traditional base: the working people. The trades halls are empty these days because so many of those people that used to be the champions of the trade hall now sit in this debating chamber. They now sit in this debating chamber distant, aloof, out of touch, arrogant, and soon to be out of Government.

So this Minister, who is often referred to as being a potential successor to lead the Labour Party, is going to be the cause of their demise. Now, we know on this side of the House that it’s in his personal best interests to bring down the Government, and by crikey, he’s doing a wonderful job at doing that. He’s making everything he possibly can do happen to bring down this Government. One has to ask—and certainly those members that sit on the backbenches of the Labour Party in this House, they must be questioning what his motivation is, because clearly it is not to support them or their political or electoral success. It is his own.

So what’s happening here is a retreat of Napoleonic proportions. We are going to have to support this piece of legislation because it was a stuff-up in the first place. It was a mistake in the first place. The industry and the sector told the Government it was a mistake. We told them it was a mistake. It included a whole range of vehicles like motorcycles that were never intended to be part of it. Now they want us—now they want us—to provide them with the solutions to their conundrums and their problems. Well, they will just have to wait. But trust me, there are better solutions.

The parties of the left in this Parliament don’t have a monopoly on climate policy, and they don’t have a monopoly on ideas about how to better bring a decarbonised economy to New Zealand. The political Labour Party is imbued with their own ideological mantras that are so distant from reality and practical application that they simply are out of tune and soon to be out of office. So here we are in urgency in the second reading of this piece of legislation, having to support them, because it’s the right and prudent thing to do to dig them out of a hole of their own creation, of their own making. An arrogant, out-of-touch Minister who comes to this House, talks about doughnuts, and by crikey, he’s had more than his fair share of doughnuts, and it’s very obvious to see that. But he is the Minister that is single-handedly causing the most anguish, hurt, and pain in this Parliament. So thank you, we’ll support this legislation because we understand the need to dig them out of a hole.

TERISA NGOBI (Labour—Ōtaki): Thank you, Madam Speaker. I just forgot where I was for a moment; I thought—after the last speaker took their seat and what they were saying—I was at a comedy show. But, anyway, it’s always really interesting to hear those whose suits probably cost more than most people’s cars talk about being in touch with New Zealanders—especially, as I know, with my second-hand hybrid that, as I said, I had to get a loan for, and the money that saves me in petrol: five bucks over Transmission Gully. Five bucks is not a lot to you guys over the other end of the House, but lots to us.

Anyhow, as the Minister of Transport said, the Clean Car Standard is about giving New Zealanders options. It’s about supporting New Zealand’s budget and reducing the cost of petrol—something that they wouldn’t really care about; just bubble gum change, but to us it’s a lot of money. So giving people money back into their family budget.

This is about taking real action on climate change and supporting New Zealanders, including our importers, who we are sure you would wish to support as well, to reduce their carbon emissions. This is our Labour Government supporting New Zealanders, and our Labour plan to tackle climate change. It’s a no-brainer. Thank you, Madam Speaker. I commend this bill to the House.

RICARDO MENÉNDEZ MARCH (Green): Thank you, Madam Speaker. Climate change is impacting us right now, and it shouldn’t take much of a Google to realise that many communities are already facing displacement and major disruption to their lives because of the effects of a change in climate. Responding to the climate change also requires bold action, particularly in the transport sector, where we know that domestically so many of our emissions are being produced. And in order to do that, we should be discussing how we can ensure that we can take bold action while supporting people instead of just taking jabs across the House on who’s going to lose their jobs and who’s going to retain their jobs, and just making political hot takes about who’s the most useless person here. Because, ultimately, if we’ve got people who are still climate deniers who are, effectively, more interested in political hot takes rather than doing the best for our communities, they are doing a disservice to the future generations who are going to be displaced.

In order to take bold action, we should be focusing on how we can better support people into cleaner vehicles, how we can invest into free public transport services that are frequent and the workforce in the sector that is well-supported and well-paid. While this Government may be moving in the right direction—in a direction opposite to where National would be heading—it is definitely not moving fast enough. We as the Greens have been pushing Labour to do the right thing and to take the climate crisis with the seriousness that it deserves.

New Zealand has been historically disadvantaged by a lack of fuel economy standards that support people into cleaner vehicles. That is one part of the puzzle but an important one, considering that historically in New Zealand we’ve been the dumping ground for high-emissions vehicles. The Clean Car Standard and Clean Car Discount have started to change the types of cars that people are driving. It will have a major impact later on. This is why this Government should be moving faster instead of delaying this action. This is why the Green Party cannot be supporting this bill.

The Green Party will continue standing for bold action on climate, rather than delays. We’ve seen a bit of a conflicting trend over the past 24 hours, because it is not just delays on things like clean cars that we’re seeing; it’s delays on healthy homes. Right now, when we know that so many people are facing massive pressures on the cost of living, people are struggling to access the healthcare system. We should be moving faster, not slower. So the Green Party cannot be supporting this bill. Kia ora.

SIMON COURT (ACT): It gives me great pleasure to be in Parliament speaking on this bill introduced by transport Minister Michael Wood under urgency—the Land Transport (Clean Vehicles) Amendment Bill (No 2). Now, ACT will be opposing this piece of legislation for completely different reasons than the Green Party.

Firstly, we don’t think that any policy, like ute taxes, subsidising Teslas, or taxing vehicles as they arrive on the wharf in New Zealand is necessary to actually reduce carbon emissions. And I want to give you an example about bad Government transport policy or climate policy or social engineering policy that doesn’t reduce emissions. I’m just going to refer, as a comparator, to the car scrappage scheme. The “cash for clunkers” scheme also proposed to reduce carbon emissions, which, for $569 million, will only reduce 4,500 tonnes of emissions—it’s $126,000 per tonne of carbon reduced.

Now I’d be interested to know—and maybe this is a question we can wait until committee stage—for the cost of this policy, how much carbon will be reduced and what will the cost per tonne be? Because if the clean car scrappage scheme, the “cash for clunkers” scheme promoted by Michael Wood as a carbon reduction scheme—if that can reduce carbon from $126,000 a tonne, how on earth is that justified when you can buy a carbon credit on the emissions trading scheme today for about $85 a tonne, put it through the shredder so no one else can use it again. Eighty-five dollars a tonne, or $126,000 a tonne for “cash for clunkers”.

And I wonder where this scheme fits in. Is it somewhere in the middle? Is it maybe that we can reduce a tonne of carbon for $60,000 or is it $20,000 or is it $10,000? But who would know? Because when the Government makes polices like the clean vehicle bill, which ACT opposed at primary legislation, what they do is they say, “We’re going to help shift the dial. We’re going to pull a whole bunch of levers in the economy so that New Zealand meets its carbon emissions reduction targets.”

But what this Government fails to tell New Zealanders is that not a single policy lever will reduce carbon emissions because we already have a cap on emissions under the emissions trading scheme. And if Minister Michael Wood wanted to reduce carbon emissions, then he would go to his buddy climate Minister James Shaw, assuming he’s back from an Egyptian resort or wherever he’s been—

ASSISTANT SPEAKER (Barbara Kuriger): Can we please go back—

SIMON COURT: —where they have dates and figs—

ASSISTANT SPEAKER (Barbara Kuriger): Order! Can we please go back to the Clean Car Standard. Thank you.

SIMON COURT: Yes. So if the Minister of Transport wanted to reduce carbon emissions, he’d go to the Minister of Climate Change and say, “Could you please reduce the cap on emissions under the emissions trading scheme?”, because that’s the only cap that matters—the only cap that matters. None of these other policies reduces emissions.

Then we have to ask ourselves, what is the point of this policy? Well, ACT asked that at the Transport and Infrastructure Committee last year and officials were in a spin, because when you ask an organisation like the New Zealand Transport Agency (NZTA), whose responsibility is safe and efficient road networks, actually building highways to connect communities to workplaces and recreation and schools, for example, and you say, “Oh, by the way, could you please design a scheme?”—because the scheme wasn’t designed when the bill was presented to select committee last year. The scheme wasn’t designed, and they said, “We’ll have a crack at that, but we don’t know if there’ll be enough time to do it.” So that was advice that NZTA gave to the Minister, and then it turns out that not only was NZTA right, but the industry was also right.

The industry also pointed out that this legislation, when it was passed last year, had the potential to capture motorcycles and mopeds. And, of course, who could imagine that a motorcycle or a moped is a high-emissions vehicle that needs to be taxed at the wharf? Well, the ACT Party asked the Minister in written parliamentary questions whether the legislation would in fact capture motorbikes and mopeds, and he acted like there’s nothing to see here. “Everyone move along. These are not the motorbikes you’re looking for.” And then he introduces a bill correcting the errors in the legislation.

But it’s wonderful the Minister’s finally decided to listen to the industry. They’ve been crying out for months the system wasn’t ready and would wreak chaos on the imported vehicle industry. The entire New Zealand motor vehicle industry relies on imports. We don’t make cars here, and the Clean Car Standard, which this legislation sets up, is actually designed to incentivise the production of clean vehicles at the factory gate in Europe. The EU first produced a standard of this type to incentivise or penalise the likes of Volkswagen and others who produce cars in a factory in Europe to produce cars with lower-emissions values. And if they went over the limit, then they had to pay a tax to the EU, but if they were under the emissions limit, then they got a credit. And, overall, the likes of Volkswagen can kind of balance things up so they produce a combination of high-emissions and low-emissions vehicles.

Well, that doesn’t apply to New Zealand. It couldn’t possibly apply because we don’t make cars here, and that is exactly what the Transport and Infrastructure Committee was told by submitters last year. That’s what Julie Anne Genter was told in her role as a former Associate Minister of Transport who proposed this. That’s what Michael Wood was told, the Minister of Transport, but, of course, they ignored all the advice, and here we are today trying to work through why this bill should be amended.

The ACT party won’t be supporting this amendment because we don’t support the primary legislation. We voted against the zero carbon Act. We voted against a climate emergency. As a civil and environmental engineer, calling something an emergency does not help solve long-term problems. A hurricane is not a long-term problem to be solved; it’s a real emergency. A tsunami is a real emergency. The climate emergency is a problem to be solved that requires long-term and considered solutions, but it can’t be solved by Government, clearly—certainly not by this one.

Now the Minister’s listened to the industry, but now he’s kicking the can down the road by just six months. This is going to be a huge burden on importers who will still be liable for the charges under this scheme when those vehicles—about 200,000 a year—arrive on the docks in New Zealand. They’ll still be liable for the charge, but they won’t get an invoice for six months. Can you imagine operating a business knowing you’re incurring a cost for which, if you don’t pay it, you could be not just penalised but potentially bankrupted, and not knowing the costs that you’re racking up on a weekly, monthly, and daily basis? You’ve got to remember: a thousand cars a day come across the wharves in New Zealand. A whole lot of importers who import a few hundred or a few thousand cars a year, they won’t know what their actual liability is until six months after that car has landed on the wharf.

What an appalling thing to do to New Zealand businesses, but that’s what this Minister is now proposing. Rather than saying we’re going to delay the whole legislation, and we’re going to delay the implementation date, he’s just saying we’re going to delay the due date for invoices. What a terrible thing to do to New Zealand businesses. But rather than a 1 January date for having to reconcile your costs, he’s pushed it back by six months, so at least some of the importers get a Christmas holiday back that the Minister was intending to take away with the original 1 January implementation date.

But, you know, as I mentioned, this Minister, he’s like a bad Santa, giving vehicle importers a break on the one hand, but making sure that he’s got a terrible, terrible present boxed up for them six months down the track. The importers will pay the price later. They’re going to pay the price with stress, uncertainty, and, of course, everybody who buys a vehicle that comes across the wharf in the next six months is also going to face the uncertainty of, “Did I pay the right carbon price? Did I pay a carbon price I shouldn’t have paid? And will they come to me later and say, ‘When you go to register your vehicle again, you’ll be liable because the vehicle didn’t pay enough carbon tax.’?”

Now, this is terrible law. There is no doubt that this, again, represents a net transfer of wealth from one group of people to another at the direction of the State. Now, if the State knew better how to invest in things, then maybe we could trust them. But under this Government, there’s been absolutely no evidence that the State knows better how to invest your money. So telling you that they’re going to be encouraging you to purchase a lower-emissions vehicle by taxing utes at the border—they’re already taxed at the dealer’s lot with the ute tax. What they call the clean vehicle discount is just another tax on Kiwis; ACT will oppose it.

HELEN WHITE (Labour): First of all, I just want to say congratulations on your new role. It’s lovely to see you in the Chair. The part of this that I want to just focus on for a couple of minutes is the success of this scheme and the context of these changes. We have had a scheme that has meant, so far, that there’s been this huge uptake in these vehicles, and these minor adjustments are absolutely par for the course when you are actually changing things. And that’s my challenge to the Opposition. This is about changing things and being sensitive to people when you’re doing it so there isn’t a giant backlash. This is a pragmatic Government. This is also a visionary Government.

I was in the submissions when I had people tell me, for example, that they were never going to see heavy vehicles in this area, that it wouldn’t happen—things like vans wouldn’t be able to be brought in, we couldn’t because we were a tiny place in the world. We’ve done it. It’s extremely successful. One of the examples of this was that one of the vans that was $100,000 before the scheme went down to $80,000 so it could get the subsidy. So it actually reduced the cost of those vehicles.

Simon Court: Point of order, Madam Speaker. The bill we’re debating is the Land Transport (Clean Vehicles) Amendment Bill (No 2), which relates to the Clean Car Standard. The policy that the member was discussing was the Clean Car Discount, which is a completely different policy and regulation. Madam Speaker, I just urge you to ask the member to come back—thank you.

ASSISTANT SPEAKER (Barbara Kuriger): Stick to the bill, please. Thank you.

HELEN WHITE: Thank you. It’s an interesting and rich statement given the speech that we’ve just had from the member. But what I would say is that this particular change, these little minor changes, are the stuff of actual real big change, that we’ve got to be prepared to adjust things when we need to. And actually, the kind of barking that we get about this is really the result of people not liking success. This is a successful, good policy for New Zealanders. I look forward to one day being able to afford to own an electric vehicle, and I look forward to those who are bringing in vehicles which are not so environmentally friendly being sheeted home with the cost of that. Thank you.

Simon Court: Madam Speaker, I seek the call.

ASSISTANT SPEAKER (Barbara Kuriger): Look, no. Sam Uffindell was actually on his feet, so I’m going to take Sam Uffindell—five minutes, thank you.

SAM UFFINDELL (National—Tauranga): Thank you, Madam Speaker. Look, I note that I support efforts to improve mitigation of climate change and to bring cars into this country that are going to reduce our emissions. I think that’s a really important thing that we do as a country. I support initiatives in that favour. I, too, would like to have a couple of hybrids; they’re pretty punchy at the moment. But my plan is to put solar on my roof and to then have some hybrids. It is a bit frustrating that we’re here having to clean up this stuff-up. It would have been good to have got that sorted out earlier; we didn’t—we’re here, we’re amending it, and we are supporting these amendments.

I will take a bit of exception to how the Minister had a crack at of my colleague earlier. I thought it was pretty disrespectful. I think if you look back over the Minister’s record, he’s had a terrible time as Minister of Transport, whether it be a $30 billion light rail project, whether it be all the pot-holes, whether it be the speed signs, whether it be the cycle bridge—next month, it will be a cycle tunnel; I don’t know what his next initiative is. Don’t get me started on how bad he’s been on immigration; he’s causing so much damage to families and businesses out there. He’ll do damage to you guys as well, and you know it. I support this bill.

ASSISTANT SPEAKER (Barbara Kuriger): Thank you. Just before I call Ginny Andersen, I will say that there have been some comments going both ways, so it’s not been all one-sided this morning. It’s a tense topic. I call Ginny Andersen—five minutes.

GINNY ANDERSEN (Labour—Hutt South): Thank you, Madam Speaker. Well, that was an enlightening contribution, again, from that side of the House. Look, climate change is a challenge. We’re not putting our heads in the sand like National are. You know, they’d be quite happy to go on driving big cars, churning through the gas, and doing that without really making any lifestyle changes to make sure that we mitigate climate change. They’re the first to complain about the effects of climate change, when you look at pot-holes—first to complain about that—but don’t want to do anything about the increasing environmental factors that New Zealanders are facing.

This bill actually does something to address those issues that are going on around our country. This bill is about taking your head out of the sand and about making it accessible and available to everyday New Zealand families to make clean choices and to convert to having an electric car.

The Government’s Clean Car Discount scheme has been a roaring success, with more than 57,000 light electric and non - plug-in hybrid vehicles registered in its first year of operation. We’re seeing that pick up and we’re seeing people make those changes, and people are also making those changes not just for environmental factors; they’re making them also because it’s a cheaper way to run the family car. With the rest of the world moving to phase out petrol vehicles, we’ve kept with our ambitious targets to stop becoming a dumping ground for the world’s dirtiest cars.

I’m proud to be part of a bill that’s progressive. I’m proud to be pushing forward a bill that makes electric vehicles more accessible for New Zealanders, and I commend it to the House.

RACHEL BROOKING (Labour): Thank you, Madam Speaker. I was remiss not to acknowledge your presence in the Chair in my last contribution, so thank you for taking up this role for us all.

Now, as we know, this bill is about this Clean Car Standard. The Clean Car Standard is to improve both the health of the community and also the climate by reducing emissions. It’s important to note that this idea of a clean car standard has been around for some time. It was put to the previous National Government and they did nothing. That is a theme.

We’ve just heard from the Hon Scott Simpson in his contribution. I think he was saying that we need to do things for climate change, but when challenged on this, he said he had no examples of what should be done differently from what this Government is doing. His speech was full of imagination. So I was disappointed not to hear any examples from him.

People watching at home would have seen Simon Court’s contribution. I agree with the part where he says that climate change needs some long-term planning. It certainly does. It also needs short term actions, and this is one of those. I commend the bill to the House.

Hon DAVID BENNETT (National): Thank you, Madam Speaker. Wow! What did I say to the Minister to upset him? I don’t know what I said. Was it because he had failed on Auckland light rail that upset him? Was it because the cycle bridge has been a complete failure? Was it because he cancelled major roads throughout the country and then had to reinvent them? Was it because he was reducing speed limits around the country because he can’t fix the pot-holes? Was it because of his incompetence around this bill, where he deliberately, arrogantly came to the committee at the start of the year and overrode submitters, saying, “We will get it done.” And, actually, they are coming back now because he couldn’t get it done. Which of the failures upset him so much that he had to engage in “little man syndrome” and go out and attack other speakers? What is so sensitive about that man that he can’t handle criticism? Why can’t he handle the actual fact that he is the worst Minister of Transport that we’ve ever seen in this country?

Now, I made the very valid point that in New Zealand we are in the Australian-Japanese car market, which has hybrids as the solution for the environmental concerns—not the European car market, which uses electric vehicles (EVs). The whole point of the submissions that came in front of the select committee at the start of the year, were two things. First of all, the rules you’re setting in place won’t work, and the Minister said, “No, I can override that” and “they will”, and here we are today doing the opposite. The second thing they all said was “You’re using the wrong standards for the market of the cars that come here—you’re using EVs as the crucial thing.”

The Minister interrupted me rudely in my speech and said that I didn’t know what I was talking about basically, and so I asked him: is it the European standard or is it the Japan standard? He said it was the Japan standard, which backs up what I was saying. Then he had the gall to come and use his speech at the start of this reading to say, “Oh, he doesn’t understand the difference between hybrids and EVs.” Well, I’ll give you submissions here that show that in 2026 hybrids actually pay—they pay under this legislation. Hybrids don’t get a free ride like the Minister tried to indicate to the House. EVs are the ones that get a free ride, but we are not in the EV market. We are in the hybrid Australian-Japanese market. There will be a certain percentage of EVs that are imported but it’s very small. But if you really want to do the environmental change, you go for what our market is.

The Minister has deliberately misled this House. He’s got an opportunity in a few moments to come in and actually change that. Now, when you deliberately mislead the House—

ASSISTANT SPEAKER (Barbara Kuriger): Order! During the first reading I said there will be the opportunity to ask the Minister questions during the committee stage. Please come back to the second reading.

Hon DAVID BENNETT: We will ask him that question.

Hon Dr David Clark: Point of order, Madam Speaker. The member accused another member of deliberately misleading the House. He cannot do that.

Hon DAVID BENNETT: Point of order. It’s a matter of truth. The reality is that he deliberately misled. It’s not that I’m making it up. The truth is that he deliberately misled.

ASSISTANT SPEAKER (Barbara Kuriger): No. Order! Mr Bennett shall stand, withdraw, and apologise. He is not to accuse another member of misleading the House.

Hon DAVID BENNETT: I withdraw and apologise. He deliberately misled the House, though, and there’s nothing wrong with saying that.

ASSISTANT SPEAKER (Barbara Kuriger): Mr Bennett, your speech is completed.

ANGELA ROBERTS (Labour): It’s wonderful to see such strength and kindness from Taranaki-King Country in the Chair. It is wonderful to stand and take a call on this bill. This Government is ambitious and progressive, and that means that we do new things. The original bill was evidence-informed, and it also meant that we’re required to continue to be nimble by working with industry to make sure that we have the best way to effect this in this House and make sure we’ve got sustainable change.

Mr Halbert talked about a suite of changes that we need to reduce emissions, a suite of changes to reduce transport emissions. Madam Speaker, as you well know, public transport isn’t an option in the part of the country I live in. I don’t live in a leafy suburb; I live in a very damp part of Taranaki, and I cannot catch a bus to work. I and my neighbours aren’t in the market for a Tesla, and I and my neighbours are really pleased at what this Government is doing to build a solid second-hand market for clean vehicles. It is a great example of how we’re ensuring a just transition, something the other side of the House knows nothing about. They don’t know about giving access to all New Zealanders so they can play their part in reducing our emissions. I’m really disappointed, and I feel like I’ve got my full economics teacher voice on here—really disappointed. It’s really obvious that no one on the other side of the House passed level 1 economics and understands the basic concepts of supply and demand and the part that this bill plays in ensuring that the supply that we need is going to be effective.

This Government is proven to be able to lead and to navigate in times of immense change. We are not scared to go where it is difficult to be. The planet deserves it, my neighbour deserves it, and our kids deserve it. I commend this bill to the House.

A party vote was called for on the question, That the Land Transport (Clean Vehicles) Amendment Bill (No 2) be now read a second time.

Ayes 99

New Zealand Labour 64; New Zealand National 33; Te Paati Māori 2.

Noes 20

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

Motion agreed to.

Bill read a second time.

Introduction of Bill

Introduction of Bill

ASSISTANT SPEAKER (Barbara Kuriger): I understand it is the intention of the Government to introduce one bill.

CLERK: Accident Compensation (Access Reporting and Other Matters) Amendment Bill, introduction.

ASSISTANT SPEAKER (Barbara Kuriger): This bill is set down for first reading presently. The Land Transport (Clean Vehicles) Amendment Bill (No 2) is set down for committee stage immediately. I declare the House in committee for consideration of the Land Transport (Clean Vehicles) Amendment Bill (No 2).

Bills

Land Transport (Clean Vehicles) Amendment Bill (No 2)

In Committee

Part 1 Amendments to Land Transport Act 1988

CHAIRPERSON (Greg O’Connor): Members, the House is in committee on the Land Transport (Clean Vehicles) Amendment Bill (No 2). Members, we come first to Part 1. This is the debate on clauses 3 to 8 and the Schedule, “Amendments to Land Transport Act 1988”. The question is that Part 1 stand part. I might just let members know that one advantage of having this bill heard consecutively is the ability to have more wide-ranging speeches is met. When we come, of course, to the committee stage, we will be focusing on those aspects of the bill, just to let the members know.

BARBARA EDMONDS (Junior Whip—Labour): Point of order. I seek leave to debate all parts as one.

CHAIRPERSON (Greg O’Connor): Leave is sought for that purpose. Is there any objection? There is none—there is objection. The question is that Part 1 stand part.

Hon MICHAEL WOOD (Minister of Transport): I’m very pleased to speak briefly in the debate on Part 1 in the committee stage of this piece of legislation. The bill, as members of the committee will see, is a relatively short one, and Part 1 is the substantial part of the bill that makes the key changes that the Government has brought to the House through this piece of legislation.

I refer members first to clauses 5 to 7. This is a piece of the legislation which deals with the issue around motorcycles and mopeds. The main way that it deals with this issue is that the amendments replace references to light vehicles with references to type A or type B vehicles. This is quite an important point for members to be aware of. The existing legislation does not require motorcycles and mopeds to pay charges or make them eligible to receive rebates under the legislative design. They’re not covered by that part of the scheme, but what it does require them to do is to set up carbon dioxide accounts. So, effectively, what this piece of the legislation does is remove that requirement to set up carbon dioxide accounts so that there are no requirements for importers of motorcycles or mopeds under the legislation. And that’s because those two terms are defined differently in the legislation. Type A and type B vehicles do refer to cars, whereas the broader term of “light vehicles” can be defined as to mean motorcycles and mopeds. And that is not the intention of the legislation to put any requirements on importers of those kinds of vehicles. So that’s a simple clarification.

Clause 8, which amends Schedule 1 of the principal Act, is important in terms of putting in transitional provisions that have the effect of deferring until 1 June 2023, the date on which charges for vehicles imported by category 2 light vehicle importers between 1 January and the 31 May are payable; similarly, the date from which a light vehicle importer may transfer carbon dioxide credits—their carbon dioxide account—to the account of another light vehicle importer. It’s just important to explain clearly what that means. This piece of legislation, the parent piece of legislation, is about putting an obligation on importers to account for the carbon dioxide emissions of vehicles that come in. And then there is a carbon dioxide standard which they are asked to meet. Now, it’s not a standard by which they cannot import vehicles if they are above that standard. It’s, effectively, a market mechanism. For category 1 importers, they will generally be the bigger importers who, for the most part, are importing new vehicles. They’ll operate that on an annual basis, so they’ll look at all of the vehicles that they import over the course of a year—some may be above the carbon dioxide standard; some may be below the carbon dioxide standard. The requirement is that, at an average level, they meet that carbon dioxide standard. If they’ve imported, overall, a fleet that is above that carbon dioxide standard, then a fee will apply. If they’re below that standard, then they’ll have a rebate which they can effectively trade with other importers. That has the effect of effectively using a market mechanism to incentivise importers to bring in vehicles that are cleaner and will drive down emissions. And that’s been very effective internationally. Most countries already have it.

So for those category 1 importers who will probably import the majority of vehicles, including most new vehicles, they’re entirely unaffected by this bill—that’s done on an annual basis; they’ll, effectively, look at what they’ve imported over the course of the year at the end of 2023; nothing changes for them. It’s the category 2 importers, which tend to be the smaller importers and tend to be more weighted towards used importers, who will be required to comply with this scheme and the carbon dioxide standard on a consignment by consignment basis. And it’s the engagement we’ve had with the industry there which suggests that it will be potentially more challenging than would be ideal for them to do that in the first half of this year. A little bit more time is needed for them to be able to do that. In that interim period, under the changes that are proposed here in clause 8, the obligations are still there. So they will still, effectively, on a consignment by consignment basis, be accruing credits or charges on those vehicles. I do note there was a comment earlier in the debate—I think from Mr Court—to say that importers would not know what rebates or charges they were incurring. That is not correct; it will be very clear. It is set out in the legislation what the carbon dioxide level is and what the charges are that are applied. They will be aware of what they are incurring.

But, effectively, under this change in Part 1, the obligation to then pay, or the ability to use rebates to enter them into the system and to trade with other importers, it’s only that bit which gets deferred until 1 June. So in terms of the totality of the scheme, the impact of the scheme, the emissions abatement function of the scheme, nothing actually changes. It’s simply the point moving from 1 January into June at which the obligation to either pay—if they’ve brought in vehicles over the carbon dioxide level, or the ability to engage in trading with rebates—it’s just that that bit gets delayed until 1 June under this change in Part 1. So those are the two substantive that are made in the bill that are reflected in Part 1, and I’m very happy to take any questions from the committee about them.

SIMEON BROWN (National—Pakuranga): Thank you, Mr Chair, for the opportunity to take a call. Of course, in normal times, this would have had the opportunity to go through the select committee stage, and submitters would have been able to have their say. In fact, they have had their say when this went through the law back in February, and, of course, they said that this was being rushed, and now we’re here at this stage where we’re actually having to fix, in Part 1, one of the stuff-ups the Minister’s caused in regards to motorbikes and mopeds. Of course, officials advised him about the rush—the submitters certainly advised about the rush—and so the question now will be whether this actually fixes it and that we’re not actually going to be back here in six months’ time sorting out more problems because we’re rushing this legislation through under urgency.

So my question in regards to Part 1, in regards to the definitional changes, effectively, of which vehicle importers must hold carbon dioxide accounts, which replaces the words “light vehicle” with “Type A” or “Type B” vehicles—I ask the Minister when was he first advised that this was going to be an issue, and when did officials advise that this was something which would require a law change? When was draft legislation provided to the Minister? When did industry tell him that this was going to be an issue? What did they tell him and why is it being rushed through now rather than having been fixed earlier? Because the reality is we’re using urgency to fix a problem, which, from my understanding, has been known about for some months. And now we’re here in late November, with the carbon dioxide accounts required to be opened by 1 December, fixing a stuff-up which he knew about for some time.

So I’d like the Minister to be transparent, because if we had had a select committee stage, we would have had the ability to ask officials a lot of questions, to get answers to those questions. Now all we’ve got is the Minister from the most open and transparent Government in New Zealand’s history, apparently, here, and this is our only avenue and our only opportunity to actually get answers to these questions. So I look forward to a bit of openness and transparency and maybe a little bit of an apology to the Parliament and to New Zealanders that we’re having to spend this time fixing up a stuff-up.

There’s been no acknowledgment from this Government and from this Minister that there’s actually been a mistake made. If he just stood up and just said, “We made a mistake.”, a lot of New Zealanders would go, “Well, thank goodness someone’s acknowledged they made a mistake. And, yeah, we understand.”, and move on. But there’s been no acknowledgment that he’s been talking high and mighty about climate change and we have to do this, and his aspirations and his woke virtue signalling. But he can’t just say, “I’m sorry. I got this wrong. We stuffed this up. We made a mess. We didn’t listen. We rushed it and here we’re back.” Just an acknowledgment of a mistake, I think, would go down extremely well with many New Zealanders. But the arrogance of this Government has seeped right through to the top.

We’ve seen it in the comments earlier. The river of insults that have come from the Minister’s mouth earlier towards my colleague David Bennett I thought was an absolute low blow—

Hon Member: Disgraceful.

SIMEON BROWN: Disgraceful and demeaning for the man who aspires to be the next Prime Minister of New Zealand and something which I think is just something which he should apologise for as well. So I ask those questions. This is our one opportunity to get answers around when he was advised. What advice was he given? When was the bill drafted? When did the industry tell him this was a problem? Why did we not have this legislation earlier? And why will he just not apologise to the House and to New Zealanders for a stuff-up?

Hon MICHAEL WOOD (Minister of Transport): This is the committee stage of the debate. It’s an important part of the parliamentary process to examine, in detail, parts of legislation that have been brought to the House. I’m very happy—I don’t think this is the time to engage in political speeches, so I’ll keep to the issue and respond to the questions that Mr Brown has asked.

Mr Brown is, effectively, correct that the definition around light vehicles versus categories 1 and 2 is, effectively, an error from the legislation. It has meant that there has been a lack of clarity around whether motorcycles or mopeds have to set up carbon dioxide accounts. Again, I’ll just repeat that there’s actually no fundamental issue here in respect of whether motorcycles and mopeds have fees or rebates that apply to them. They don’t. There’s never been any lack of clarity around that. So that’s something that the Government owns and that I own, and that’s why we brought a change to the House in order to correct that error.

I do note that this was not actually a rushed legislative process. The original legislation went through a full legislative process, a full select committee process, a full committee of the whole House stage, and actually wasn’t an issue that was picked up by anyone at that time, including submitters and including our noble Opposition, who had the ability to examine the legislation at select committee and in the committee of the whole House. It is an error in a complex piece of legislation, and we’re fixing it now. That is the state of it.

When was I first advised of this? A few months ago, around about July, August. It was probably first brought to my attention through engagement with industry. Since that time, I sought advice from officials to try to determine whether there are other ways of managing the issue, and we determined that the best and most appropriate way of providing clarity was to change the legislation so that there were absolutely no doubts about the requirement to set up a carbon dioxide account. That’s what we’re doing today.

SIMON COURT (ACT): Thank you, Mr Chair, and, Minister, thank you for coming to the Chamber to engage in this discussion around the proposed amendments. I’ve already stated clearly that ACT won’t be supporting this proposed amendment because we fundamentally disagree with the premise of the original bill. It won’t be possible to reduce New Zealand’s carbon dioxide emissions any further with this policy or with this regulation, because all of our emissions are already capped under the emissions trading scheme, Minister. So that leads me to a number of questions that I have.

We’ve heard you articulate that vehicle importers—because New Zealand only imports vehicles and we don’t make cars here. We’re entirely reliant on motor vehicles manufactured in the European Union, Great Britain, Japan, Korea, and other places around South-east Asia, and, to a limited extent, the United States, which actually makes some fantastic petrol and diesel vehicles, particularly the Dodge Ram and some of those other really, really big utes that people who have big tools and need to carry their big tools around in.

But, Minister, I want to ask you about the unders and overs first. So if, for example, I’m importing, say, just Dodge Rams, a very large petrol or diesel vehicle, and that’s my specialist market—I only import those vehicles. Or, say, for example, I’m an importer and I specialise in importing used utes and selling them to tradies and farmers. A one-year-old or even a three-month-old ute that was first registered, say, in Japan or Thailand, like a Toyota Hilux registered in Thailand, is regarded as used when it comes to New Zealand, even though it might have the same kilometres on the clock as, say, a dealer demonstrator model that’s been imported as a new vehicle. So when we’re thinking about used vehicles, if I just specialise in importing, say, utes to sell to farmer and tradie customers, I’ll only have overs. I’ll only be liable for cost. I won’t have any unders. I won’t have any savings. So that’ll be all cost that gets passed on to my customer.

Then we think about the opposite. Say, I’m a motor vehicle importer, new or used, and I specialise exclusively in low-emissions vehicles. Of course, that would help to reduce New Zealand’s carbon profile, not the world’s though, because once that car’s left the factory gate, it doesn’t really matter where it’s driven. It’s a low-emissions vehicle. Imagine if I’ve got credits under this scheme. So we’re talking about the unders and overs component. Now, if I want to, as you pointed out, sell those credits to another dealer, say my alter ego that wants to import Dodge Rams, will those trades in these carbon credits under the schemes be subject to GST, to income tax, and to the anti - money-laundering requirements? Because there has been some concern expressed by industry representatives that, actually, while this sounds good in principle, if you import tens of thousands of vehicles a year and you can balance it because you’re a big importer, that’s fine, but if you’re importing, say, just tens or a few hundred vehicles a year, this is going to be very difficult to administer, and there is an opportunity for potentially big tax liabilities or even the risk of money-laundering through the way that these credits are managed.

Then I want to ask you a further question about the delay in the time that this bill allows for the payment of the charges that might be incurred by an importer. Minister, you’ve stated that importers will—they know there’s a schedule of carbon dioxide emissions and they will know which vehicles accrue certain costs. So I understand from that that you expect the importers to account for their own liabilities. But my second question that I would like you, potentially, to seek advice from officials on, is: will the New Zealand Transport Agency (NZTA) or the organisation administering the scheme be sending out an accrual or a statement on a monthly basis, even though it’s not liable for payment until that six-month delay? Because there is considerable concern from importers that many of the smaller importers do not understand the scheme sufficiently well to carry out their own assessment of the costs they’ll be liable to pay. So they would desperately like, if there’s going to be a scheme, that they understand what NZTA or the agency administering it thinks they’ll be liable to pay for, even if there are some unders and overs and wash up. So will these importers get a statement monthly starting in January or February?

Then I just want to come back to some of the other issues raised in the regulatory impact statement, which I’m assuming applies to the initial clean vehicle standard regulations as much as it does to this amendment, because it’s voluminous. In fact, it’s a much more significant document than the three-page amendment bill that was tabled. So I just want to come to the regulatory impact statement and ask you some questions about the costs and benefits of this policy, Minister. Because it’s not clear who gets the benefit but it’s certainly clear with the clean vehicle standard who will pay the costs, and that will be people who import petrol and diesel vehicles, and those costs will be faced by individuals who import petrol or diesel vehicles, or importers, motor vehicle dealers, who import mainly petrol or diesel vehicles.

But let’s look at the benefits. So what criteria—3.2 of the regulatory impact statement—in addition to monetary costs and benefits have been used to assess the likely impact of the options under consideration, the options which produced this piece of legislation, which we’re now proposing to amend? Number one is leadership at home and internationally; this includes placing primary reliance on domestic measures to reduce emissions. Now, leadership at home and internationally: the advice we got at select committee last year was that the imposition of the Clean Car Standard at the wharf was years ahead of when the same standards would apply in the European Union and Japan. The motor vehicle manufacturers, like what you call your original equipment manufacturers, said, “This doesn’t make any sense to us because the standards in the home country where we actually make these vehicles won’t apply for some years, and yet you’re telling us we have to comply with them from 2023?” That makes absolutely no sense. That’s just going to be a tax, a tax on people who purchase or need these vehicles because we can’t do anything about it. Like, the standards we manufacture to, if there’s going to be a standard, should at the very least simply be a cut and paste from the standard where the vehicles that are imported to New Zealand are made. So, Minister, I’d like you to respond to that. Why on earth wasn’t the standard and the time frame of the countries where these vehicles are manufactured simply adopted?

Because the ACT Party’s proposed—when it comes to building products, for example—we just adopt standards from other countries, instead of making up our own. So, Minister, would you please respond to that? Because the leadership we expect from Government when it comes to climate change or any other policy is not to be leading in a way that is completely irrational, based on the advice of people who actually make cars, for example.

Then I just want to come to the next item, which is leadership at home and internationally. Sorry, it’s just expanded—

CHAIRPERSON (Greg O’Connor): OK, Mr Court, we’ve been pretty generous. The bill now. This section, please. You’re very, very broad. The Chair has been very generous. So back to the part, please.

SIMON COURT: So, now, with respect to the carbon dioxide accounts, I just want to bring your attention to item one, extent to which the initiative reduces emissions; this is page 34 of the regulatory impact statement. By what amount will this policy or this regulation, amended or not, reduce emissions? Because it’s not clear. It’s not clear if we look at the parallel legislation, the Clean Car Discount, how much that will actually reduce emissions by on an annualised basis. In response to written questions that I’ve posed to you, you’ve suggested somewhere between 5 million and 6 million tonnes of carbon dioxide equivalent by 2050. I mean, by 2050—I mean, we could have flying cars by then, Minister, to be honest. So, look, what the ACT Party wants to know, will this policy reduce emissions; if so, by how much? What will the cost per tonne be to reduce emissions, given that it looks like all of the costs at the moment are simply being applied to petrol and diesel vehicles like utes and vans and people movers for large families, which are still being manufactured in Japan and other countries, still required by New Zealanders in order to, you know, take their families places and do business? So will this actually reduce emissions; if so, by how much and at what cost per tonne, Minister? Thank you.

Hon MICHAEL WOOD (Minister of Transport): The member’s comments, to a large degree, were quite general and principle-based in terms of the parent legislation and the Clean Car Standard itself. I don’t think many of them particularly pertain to Part 1, but I’ll address those which did appear to. I am happy at the beginning just to confirm, in respect of his final question, that the regulatory impact statement on page 10 is, in fact, very, very clear about the emissions abatement that is achieved under the Clean Car Standard. It’s estimated to save 1.07 million tonnes of carbon dioxide between 2021 and 2050. The member asked what the abatement cost per tonne will be. It’s the opposite if there’s not a cost per tonne; it’s a positive benefit-cost ratio of 2.22, and that’s because, actually, for every tonne that we abate under this policy, New Zealand actually saves money, and that is because of the massive cost over that period of time of imported fuel that we, effectively, reduce out of the system. So it’s not a policy that costs us money to abate carbon dioxide; it’s a policy that actually has a positive economic benefit for New Zealand for every tonne of carbon dioxide that we abate. That’s on page 10 of the regulatory impact statement.

In respect of some of the member’s other questions and points, in terms of questions around the operation of the scheme more broadly—anti - money-laundering, GST, etc.—those don’t particularly relate to Part 1 of the bill, and, as I understand it, they’re being worked through with importers.

In terms of how carbon dioxide accounts will operate, that’s not Part 1 of the bill; that’s covered by Part 2 of the bill, which is really where we can have a good discussion about how carbon dioxide accounts will operate. I’d be happy to address those matters at that time.

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

SIMON COURT (ACT): Thank you, Mr Chair. So, back on Part 1, I just want to come back to the motorcycles and mopeds error—apparently—Minister. When motor vehicle importers and submitters came to the Transport and Infrastructure Committee last year when this legislation was proposed, they identified that motorcycles and mopeds could potentially be captured. This is information that the ACT Party, through written parliamentary questions, was able to obtain in response from your office, along the lines that after some time it was acknowledged that, yes, it would capture motorcycles and mopeds. My concern with this amendment is: what other consequential impacts are there that the industry has told the New Zealand Transport Agency (NZTA) about, potentially your office or yourself, in discussions? Because we can see that there has been some external consultation—sorry, no formal external consultation, but there have been closed-door meetings with the Motor Industry Association and the Vehicle Industry Association, who primarily import used vehicles.

So I’m interested as to what other potential perverse or unintended but likely outcomes have been flagged as a result of the primary legislation and these amendments. Does it include, for example, a matter I referred to previously, that when vehicles are coming across the border and when an importer has to put information into their carbon dioxide account, the distinction between a new vehicle that lands in New Zealand unregistered and is taken to a dealer’s lot and then driven by people on test drives—what we might call a demonstrator model, that might have 15,000 or 20,000 kilometres on it, or even less, 1,500 kilometres on it. By the time it is finally sold and registered in New Zealand for the first time, how is that different to a used car that arrives in New Zealand having been previously registered in, say, Malaysia or Thailand or even Japan which has also travelled only a very few kilometres—maybe, you know, 500, 1,000, 1,500? And why would there be a difference between the way those vehicles are treated at the time of first registration, between an imported vehicle that’s done a few hundred kilometres, or potentially none, and an imported one that’s imported by an independent importer and one that’s imported by an original equipment manufacturer, say directly from the factory? The vehicles have had the equivalent running in the country that they were manufactured and supplied from.

So could the Minister in the chair, Michael Wood, please clarify, given that that’s a perverse outcome of the scheme, that a vehicle is described as used even if it’s been barely used—and, in fact, a vehicle registered in New Zealand for the first time could qualify as new, even though it’s done more kilometres than an import which is defined as used. That’s an issue that the motor vehicle industry has raised with me as the ACT transport spokesman, and I’m wondering if there are other perverse unintended potential consequences from the amendments proposed in Part 1, obviously which correct the accidental inclusion—or supposedly accidental inclusion—of motorcycles and mopeds in the rules.

Then I just want to come to this part with opening carbon dioxide accounts. Now, the ACT Party has heard that there have been significant problems establishing the IT system at NZTA in order to manage carbon dioxide accounts. In fact, like any new IT system that wasn’t fully thought-out when the legislation that empowers it was passed, often these things take much longer and cost a lot more. So, Minister, could you also please give us an idea about what was the original cost and time frame for establishing the carbon dioxide account and accounting system, what was the original cost, and what is the current time frame and likely estimated total cost?

Hon MICHAEL WOOD (Minister of Transport): The member asked whether there are any other potential adverse impacts that have been flagged to me; the answer is no. I’m not aware of any of those. There’ll of course be policy disagreements that you get from the sector about whether they agree or disagree with the scheme, but there are no impacts beyond that that have been raised with me, and, by definition, those things won’t be in the bill if they are other. We’re just here to debate those matters which are in the bill that is before us.

In terms of the question around how vehicles are defined for the purposes of this legislation as new or used, my understanding of that is that nothing in this legislation changes the way in which we assess whether a vehicle is new or used at the point of importation.

When it comes to the opening of carbon dioxide accounts, the most recent reports that I have received have been that, actually, very high numbers of importers have already successfully opened their carbon dioxide accounts. I’m not advised that there is any particular issue with the IT system that enables the establishment of carbon dioxide accounts. But we are wanting to make sure that the system is well set up to enable importers to have clear access as to the way in which fees and rebates may be getting applied and for the trading system to come into effect, and that’s the core need for the extension to 1 June.

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

SIMON COURT (ACT): Thank you, Mr Chair. So I just want to come back to the question that I posed before, Minister—that I asked if potentially you need to get advice from officials on—which is: will motor vehicle importers be receiving a statement on a monthly basis between the time when the standard comes into effect, 1 December, and when they have to pay, which has been delayed by six months? So will they be receiving a statement that shows their current position—their overs and unders, for example—and what their potential financial liability might be? Because I think it’s all very well to come to the House and say, “Look, we’re going to make an amendment; we’re going to give importers, business people”—and the people that actually rely on these vehicles, because we don’t import vehicles into New Zealand just so they can sit in some lot and be polished regularly and so on. They’re actually being delivered at a rate of—you know, up to 200,000 or so vehicles a year, to people who need vehicles; they need them for their business. They need them—like people movers, for example—to get kids and their caregivers to school.

So if we’re going to be debating what seems to be a simple amendment to delay the implementation by six months, I think it’s really, really important that we understand that people who are purchasing a vehicle, that’s, say, being purchased from an auction in Japan and imported to New Zealand, and they expect to get it on a certain date, they will want to know how much they’re going to have to pay when that vehicle arrives here, and it can be between six weeks and three months. I mean I have, personally, ordered a vehicle from Japan a few years ago; a fantastic Subaru Legacy, that was purchased at auction at a reasonable price—

Rachel Brooking: Oh, not as good as the Outback.

SIMON COURT: —and it was delivered to New Zealand, and the member there asks me “Wasn’t it a Subaru Outback?” Well, I’ve had a number of Subarus over the year, Rachel, and I can say they’re fantastic vehicles—

Barbara Edmonds: Rachel Brooking.

SIMON COURT: Yes, Rachel Brooking, thank you very much—and I know that you also drive a Subaru and I understand it’s a turbo diesel—

CHAIRPERSON (Greg O’Connor): No, I don’t, actually, Mr Court.

SIMON COURT: So, Mr Chair, coming back to the point. So for people like myself or the Labour MP Rachel Brooking who might want to order a replacement vehicle to be purchased at auction in Japan, we would want to know not just the auction price, not just the price to ship it to New Zealand or the price to achieve engineering compliance inspection, warrant of fitness, the on-road costs; we’d also want to know what is the carbon charge that we need to pay. So I think it’s absolutely vital, Minister, that we understand—for vehicles that are imported to New Zealand between 1 December and when this delay comes into effect, between when the dealers are liable to pay for the carbon charge associated with these imports, will they know how much each vehicle is going to cost the purchaser, the person like myself, or Rachel Brooking MP who also drives a Subaru, if we order a new one or a replacement one? Because it’s not clear from the amendment that that particular issue has been resolved.

There is a concern also that the industry’s raised that the carbon dioxide database is, in fact, not complete or accurate either—which is another reason which could be behind the delay in implementation, because there’s disagreement between the carbon dioxide emissions factors that apply to used vehicles. For example, you know, is my Subaru Legacy GT model—actually, that’s what I would like to have, you know, the turbocharged model, and potentially that’s the one that Rachel Brooking, Labour MP has: the turbocharged model. Is a new one of those, is a one-year-old vehicle—does it produce the same amount of carbon dioxide as, say, a two-year-old vehicle? And, if it’s a Subaru, it will never, ever degrade in performance over its lifetime; we know that—they’re the best vehicles in the world. But, look, is the carbon database that the carbon dioxide account is on complete or accurate, Minister?

So a couple of questions there. Will the importers get a statement, and is the carbon database complete or accurate? Thank you.

Hon MICHAEL WOOD (Minister of Transport): Addressing some of the questions raised by the member: the member firstly makes a point that it’s important for purchasers to know what the cost of their vehicle will be; of course that’s true. The Clean Car Standard does not establish the cost of any individual vehicle, and if I can just explain, briefly, why that is.

Firstly, it’s the importer and the distributor who will set the price. And it could well be that an importer brings in a particular vehicle—if they’re a category 2 importer—that is significantly above the carbon dioxide standard, and that could incur a fee, but it could be that the following week they import a vehicle that is below the standard and incurs a rebate, and so the importer—and then the distributor—will make their own decisions about how they price their own vehicles. The Clean Car Standard applies either a rebate or a fee—or, in fact, for many vehicles, nothing—to individual vehicles, and that applies to the importer; it doesn’t apply to the purchase price. He does ask an important question, and I’m happy to clarify this in case it wasn’t crystal clear from previous answers—the importers will be able to have clear information between that period from 1 January to 1 June about any fees they have incurred or rebates that are owing to them. They will have established a carbon dioxide account, and it’ll kind of be like looking into a bank account: they’ll be able to see if there’s a fee that applies to individual vehicles or rebates that apply to individual vehicles. Again, I do note that, actually, for many vehicles, neither will apply—there’s a significant band in the middle, but they’ll, effectively, be able to look at that and understand what their position is and therefore what they might owe, or what their net rebate might be from 1 June when those come into play.

The final point he raises—I mean, it does go to a more fundamental question in the Act rather than this part, but just for the sake of clarity, he asks where the carbon dioxide values come from that we assess vehicles against. Those are values that are held by Waka Kotahi. Primarily, those values are supplied by the industry itself. In the event that a vehicle doesn’t have a value that’s applied to it when it comes into New Zealand, the primary legislation gives Waka Kotahi the ability, based on established methodologies, to apply a carbon dioxide value to that vehicle.

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 74

New Zealand Labour 64; Green Party of Aotearoa New Zealand 10.

Noes 43

New Zealand National 33; ACT New Zealand 10.

Motion agreed to.

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

Ayes 99

New Zealand Labour 64; New Zealand National 33; Te Paati Māori 2.

Noes 20

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

Part 1 agreed to.

Part 2 Amendments to other enactments

CHAIRPERSON (Greg O’Connor): Members, we come now to Part 2. This is the debate on clauses 9 to 12, “Amendments to Land Transport (Clean Vehicle Standard) Regulations 2022”. The question is that Part 2 stand part.

SIMON COURT (ACT): Thank you, Mr Chair. So, as the Minister rightly pointed out, matters relating to carbon dioxide accounts and how they must be operated are in Part 2. In Part 2, we have clause 10, which amends regulation 14, so that if a category 2 light vehicle importer imports vehicles between 1 January 2023 and 31 May 2023, before any transfer of credits—in other words, you imported a low-emissions vehicle, you get a credit—in respect of vehicles imported in the period. is given effect to, the account holder must make the credits available for offsetting, and the director may offset the credits against any charges payable by the importer in respect of other vehicles imported in that period.

Now, that’s a very, very interesting amendment. One of the things that I want to bring to the attention of the committee, and to New Zealanders who may be listening to this debate or watching it, is that often it’s the organisations and the individuals directly impacted by legislation who have the deepest and most accurate insights into the way that legislation and regulations are going to affect their businesses and their consumers—their customers. That is why ACT exists. ACT stands for—it’s an acronym—the Association of Consumers and Taxpayers. When it comes to this piece of legislation, ACT firmly believes that taxpayers are getting a raw deal because of the enormous amount of cost and time and waste of human resources that’s gone into establishing the scheme in the first place, particularly taking the priorities of Waka Kotahi NZ Transport Agency, who are tasked with delivering a safe and efficient road system, taking their eyes off the ball at a time when our roading network has severely degraded and is going to take enormous investment, planning, and resourcing to recover—taking their eyes off the ball and forcing them to start looking at how to reduce New Zealand’s emissions when we already have the emissions trading scheme.

So, Minister, and for the people at home listening to this debate or watching it, the reason ACT exists—the Association of Consumers and Taxpayers—is because we fundamentally believe that when it comes to things like importing vehicles and measuring their carbon dioxide emissions, actually, unless there’s a benefit to doing that, why on earth would you set up a regulatory scheme to do that, and why—

CHAIRPERSON (Greg O’Connor): Mr Court, you’ve previously advertised Subaru; you’re now advertising a political party. Please come to Part 2 of the bill. I’ve been very generous; you’ve been going for three minutes. Part 2 of the bill, please.

SIMON COURT: Thank you, Mr Chair. I must say that when Greg O’Connor, who is in the Chair right now, was the chair of the Transport and Infrastructure Committee, he gave lots of time to the submitters who raised these very issues that the ACT Party is raising about this bill. So we do appreciate your quality chairing of the Transport and Infrastructure Committee at the time this passed through.

Now, I want to come to the transfer of credits. Now, what we’ve heard from the industry—and this is potentially an answer to the problem—is that there’s a risk that organisations that import low-emissions vehicles will get the carbon credits and then hold on to them, because they know that under this Government, which has signalled that the emissions cap has to go down every year, the price of carbon credits under the emissions trading scheme is only going to go up. I mean, it was $20 a tonne when I came to Parliament in 2020, then $25, then $40; now it’s $85 a tonne, and we hear from the Climate Change Commission or climate Minister James Shaw that they fully expect it to be in the hundreds of dollars a tonne in the near future.

So it would make sense, if I was a motor vehicle importer importing low-emissions vehicles, that I might want to save my carbon credits for another year, because like any Ponzi scheme, if you think the value is only going to go up, then you hold on to them until the day before the scheme crashes. The problem is, Minister, like all Ponzi schemes, no one knows who is going to crash—[Bell rung] Mr Chair, I want to come to my question. So before any transfer of credits in respect of vehicles is allowed—

CHAIRPERSON (Greg O’Connor): Sorry, Mr Court; I haven’t given you the call yet. Simon Court.

SIMON COURT: Thank you, Mr Chair. I’ll come to the question.

CHAIRPERSON (Greg O’Connor): That would be good.

SIMON COURT: So does this clause—clause 10(6)—in fact, relate to the concern that some importers raised with me that organisations that import low-emissions vehicles could potentially hoard their carbon credits in the anticipation that some time in the future they’d be able to redeem them or exchange them or sell them and trade them at a much higher price? Because it looks like they’re going to have to reveal and hand over the ability to exchange them or trade them to the Director of Land Transport.

That actually raises another issue, Minister. So, firstly, does this clause address the concern that’s been raised with me about hoarding carbon credits under the scheme? Then it actually raises another question. Some vehicle importers actually might want to hold on to the credits because they get vehicles in batches. They might get a low-emissions batch, and then at another time of the year, they’re going to get high-emissions vehicles, and so they may want to hold on to their credits to balance them out. But it looks like, in this clause here, these credits that they might accrue are going to have to be offered to the director to offset against any charges payable when it might make more sense for that importer simply to hold on to the credits and if they have sufficient working capital to pay the charges. So, Minister, I would like to know, does this clause, 10(6), which amends regulation 14, address the risk of hoarding carbon credits under the scheme? And will importers actually be required to offset charges in any given month?

Then I want to come to clause 11, which amends regulation 28, about information being publicly available, and that any person who wishes to apply for information must apply to the director on the agency’s internet site. So, Minister, could you please explain also the intent behind clause 11? Thank you.

Hon MICHAEL WOOD (Minister of Transport): In respect of regulation 14—and this is in subsection 6, in clause 10—which eventually got to a question, no it is not primarily about hoarding. It is simply about giving the Director of Land Transport the ability to let out at that period. As I’ve explained earlier in the debate, generally speaking for category 2 importers, charges will be paid at the time. They won’t be held on to for a period of time. So, given that that won’t occur between January and June, we want the process to be as efficient as possible when there’s, effectively, a wash-up in June. So this simply enables the director to net out any charges versus any rebates that have been incurred through that period. So instead of going through an inefficient process, perhaps, of a fee of $10,000 having to be paid when there is actually rebate of $12,000 in the system, we can actually net that out and have a much smoother process both for the agency that is overseeing it and also for importers as well.

When the member gets to the question around hoarding, he draws an illusion to the emissions trading scheme (ETS) as just a market mechanism and market behaviours around carbon credits. It’s quite different in this case, because, of course, the ETS, effectively, has a market price for carbon. In the case of this legislation, this scheme, the price is set in the legislation. There’s a price that is set now, and there was a price that was set that comes into effect from 2025. There’s much less opportunity, effectively, for gaming behaviour, if you want to term it in that way. This really just is about getting out and having a smooth process once the January to June period concludes, and from that point onwards category 2 importers will then carry on in the way that was envisaged under the original legislation.

The member’s second question—the member might want to remind me what that was, and I’ll quickly answer it.

SIMON COURT (ACT): Thank you, Minister. So just in terms of clause 11, which amends regulation 28 and which says, “Before the information described in subclause (1) is made publicly available, any person who wishes to receive that information must apply to the Director via the Agency’s Internet site”, could the Minister just please explain the relevance of that clause for the committee and for people who might be listening or watching at home?

Hon MICHAEL WOOD (Minister of Transport): Oh, it simply means that the importer can approach the director to get access to that information.

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

SIMON COURT (ACT): So, Minister, you make the point that the scheme—the way it values carbon credits under the scheme—is different from the emissions trading scheme, which you described as a market. One of the challenges with the emissions trading scheme, and, I think, this legislation as well, is that the price is, essentially, set by a Minister’s expectation. So if the price of a carbon credit is set in legislation here, and we know the Minister and other Ministers who are either part of the Government or support parties have extremely ambitious climate targets which they tell us often we haven’t met yet—we haven’t fulfilled, we should be more ambitious, that there’s more that could be done, there are more levers to pull—is it likely that a Government that this Minister was a part of would increase the carbon charge under the scheme? Because if that was the case, then not only would it put up the price of vehicles being imported, it would also indicate that organisations which held on to the carbon credits were quite rational in doing so, because they could expect—like, would there be an annual increase, for example, Minister? Would there be an increase in parallel with the cost of a carbon credit under the emissions trading scheme?

Minister, I think it’s really important we understand that. Is this a one price forever, fixed in the legislation and the regulations around it? Or is this carbon price—which will apply to the emissions from these vehicles or to the vehicle based on its emissions intensity factor—likely to change? Who will have the power to change it? And should vehicle importers, customers, and people who need these vehicles actually be concerned that they need to get in really quick and buy a petrol or diesel vehicle because the price might go up?

And that brings me to a further question, thank you, Mr Chair, which is: look, isn’t the risk with this legislation and with this regulation, amended or not, delayed or not by six months, that actually imposing costs of thousands of dollars on petrol and diesel vehicles for which there is currently no substitute, Minister—we’re not talking about people, individuals and businesses, that necessarily have a choice. Currently, no substitute for a large people mover at a reasonable price, or a second-hand ute for somebody, a tradie, somebody just starting off, or a young farmer, a sharemilker who’s not going to go and buy a brand new $60,000, $70,000 ute—

CHAIRPERSON (Greg O’Connor): We’re well off Part 2 with this question.

SIMON COURT: But, Minister, this—

CHAIRPERSON (Greg O’Connor): Mr Court, indulging the Chair.

SIMON COURT: I’ll come to the question. So isn’t it likely that the sum of all of these policies, whether the implementation date is delayed or not, will be—it will actually delay, because of cost, new vehicles coming into the fleet because people won’t be able to afford them. That’ll be the few thousand dollars extra they won’t be able to afford, and it will actually make our fleet older and more emissions-intensive than it otherwise would be without this intervention.

I think, Minister, it would be helpful if you give us your perspective on that because we’ve heard about the cost-benefit analysis—frankly, I don’t think that stacks up. So if you just tell us a little bit about: will the Government make changes to the price of carbon under this scheme, and, if so, will that put up the cost of people—importers and organisations—importing vehicles? And will the sum effects of this policy, which adds cost to petrol and diesel vehicles, even lower-emissions ones, second-hand ones that are currently in the fleet, will it make our fleet actually older and dirtier?

Hon MICHAEL WOOD (Minister of Transport): I’ve already answered the first question and the answer is no. We’ve already set the initial price with a further price to apply from 2025. No Parliament can bind a future Parliament, but it’s not the Government’s intention to do that.

In respect of the second question that the member asked—which is more an in-principle question about the Clean Car Standard per se than this particular part—the evidence is very clear that countries that apply a carbon dioxide emission standard have cleaner fleets. New Zealand is one of only three countries, along with Russia and Australia, that doesn’t, and we have one of the dirtiest fleets in the OECD. You become a dumping ground for the dirtiest vehicles in the world if you don’t have a regulatory standard. That’s what’s happened in New Zealand, and importers already report to me that having a standard in place, even one that hasn’t kicked in via legislation, makes it easier for them to access cleaner vehicles in the future.

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

Ayes 107

New Zealand Labour 64; New Zealand National 33; Green Party of Aotearoa New Zealand 10.

Noes 10

ACT New Zealand 10.

Part 2 agreed to.

Schedule

CHAIRPERSON (Greg O’Connor): We come to the Schedule. The question is that the Schedule stand part.

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

Ayes 99

New Zealand Labour 64; New Zealand National 33; Te Paati Māori 2.

Noes 20

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

Schedule agreed to.

Clauses 1 and 2

CHAIRPERSON (Greg O’Connor): Members, we now come to our final debate, clauses 1 and 2, “Title” and “Commencement”.

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

Ayes 107

New Zealand Labour 64; New Zealand National 33; Green Party of Aotearoa New Zealand 10.

Noes 10

ACT New Zealand 10.

Clause 1 agreed to.

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

Ayes 99

New Zealand Labour 64; New Zealand National 33; Te Paati Māori 2.

Noes 20

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

Clause 2 agreed to.

Bill to be reported without amendment.

House resumed.

CHAIRPERSON (Greg O’Connor): The committee has considered the Land Transport (Clean Vehicles) Amendment Bill (No 2) and reports it without amendment. I move, That the report be adopted.

Motion agreed to.

Report adopted.

Third Reading

Hon MICHAEL WOOD (Minister of Transport): I move, That the Land Transport (Clean Vehicles) Amendment Bill (No 2) be now read a third time.

I’m pleased to be able to rise on this final reading of the bill after we have worked through the previous readings of the bill over the last couple of hours. I do thank members of the House who did engage in the committee stage debate. I do particularly acknowledge Simon Court for the discussion and questions which he put forward in that debate. We clearly have some disagreements about the importance of there being a carbon dioxide emissions standard to apply to the imported fleet in New Zealand, but I did appreciate some of the questions that he asked, which I do hope, for the benefit of the committee and now for the House and the public, do provide some further detail about the substance of the bill that is before the House.

In general, I think that there has been a good ventilation of views about the Clean Car Standard and this bill over the course of its readings in this House. From the Government’s point of view, we remain committed to urgent action to reduce carbon emissions in our country. Transport is the second-biggest emitter in New Zealand. It emits 40 percent of New Zealand’s carbon dioxide emissions, and, unfortunately, it has the worst trajectory. Transport’s emissions have increased by about 90 percent since 1990, far over and above any other sector. Most other sectors have had small increases, small decreases, and have stayed about flat. Transport’s had the worst increase. The primary driver of that has been the growth of our fleet, the growth of our light fleet, to some degree our heavy fleet, and the fact that our fleet internationally is a dirty fleet. The average carbon dioxide emissions of vehicles in the New Zealand fleet and coming into the New Zealand fleet, until recently, have been amongst the worst in the developed world. There is a very straight line that we can draw between that and the fact that New Zealand is one of very few countries in the world that doesn’t have a carbon dioxide emissions standard. Only Australia, Russia, and New Zealand, in the OECD, to date, have not had a carbon dioxide emissions standard. So this is one of the key moves that we can make to make sure that we rapidly transition New Zealand’s vehicle fleet to being cleaner.

The benefits of that are manifold. We reduce our carbon dioxide emissions. We give Kiwi consumers a greater choice of clean vehicles to be able to purchase. Those people who are able to purchase a cleaner vehicle, whether it is a zero-emissions vehicle like an electric vehicle, whether it is a low-emissions vehicle like a hybrid, or whether it is even a cleaner petrol vehicle, those consumers will benefit from significantly lower lifetime costs for their vehicle as well. So it’s an important piece of legislation.

The reason this amendment has been brought forward is to make sure that it can be implemented as smoothly as possible. There are two key changes which have been canvassed in earlier readings of the bill. The first provides clarity that motorcycles and mopeds should not be captured by the scheme, and for the benefit of the House and those who are listening, as things stand, if there was no change, motorcycles and mopeds would not have to pay charges or receive rebates under the scheme. The requirement simply is that they establish a carbon dioxide account. We, after consultation with the industry, agree that there is not huge benefit in retaining that requirement, and so the simplest and best thing is to remove that requirement to be very clear about that in the legislation. That wasn’t the intention of the original legislation. That’s something I’ve acknowledged in the House today. We try to be pragmatic about these things when we get feedback from the sectors that we’re working with.

The second key change that the legislation makes is for category 2 importers—that is, importers that tend to bring in smaller consignments. So, under the original legislation, they would receive rebates or pay fees on a consignment basis instead of an annual basis. There is a deferral of their obligations to pay fees and to be able to engage in trading of rebates from 1 January to 1 June. So those fees or rebates will continue to occur through that period; that has not changed. But it is simply the obligation to either pay fees or to engage in trading of rebates that is deferred until 1 June. This is quite an important point. I note the Green Party’s position voting against this piece of legislation. It is just important to underscore that this change does not in any way actually affect those obligations, and, therefore, does not in any way reduce the emissions abatement potential of the scheme. It is simply a pragmatic change to ensure that that sector has enough time to be ready to engage with Waka Kotahi’s online system to be able to pay those rebates or to engage in trading to pay the charges or to engage in trading of the rebates. So we get the same outcome but we simply smooth the pathway for the sector.

From my point of view, as Minister, that’s what we should do. We have to make changes in this sector. We cannot keep doing the same things that we have done for the last 70 years which have led to growing carbon dioxide emissions, a terrible impact on our climate. We have to make these changes, but if we can do that in a pragmatic way that brings people along and makes it a bit simpler to comply, then why wouldn’t we do that? That’s the purpose of this legislation. So those are the core reasons why the Government’s brought this legislation to the House and believes it’s an important and good piece of legislation.

As I said, the debate has ventilated views about the legislation. I do want to respond to some of those views that I’ve heard over the course of the debate. The National Party’s position, frankly, is a confused one. They have raged and raised multiple objections to action to clean up our vehicle fleet. But they are finally actually supporting the legislation. This reflects the dialogue we’ve had over the past couple of weeks where they have shifted their position from not supporting and then supporting—I can’t remember quite the order—the Clean Car Discount, eventually saying that they do support a Clean Car Standard, then being a little bit unclear about what kind of Clean Car Standard they do actually support. Either way, it is some progress. They voted against this legislation initially. They spoke against there being a Clean Car Standard in place when this legislation was brought to the House. But they have, through the course of this debate, confirmed that they do support the framework of the standard, and that is a positive move. We will be a dumping ground for the world’s dirtiest vehicles without this policy. So we do need to move it forward and implement it in a pragmatic way.

But further, in respect of the views that have been ventilated in this debate, the problem that we have here is that we have another party in the House, and that is the ACT Party, who is voting against this legislation, that remains trenchantly opposed to any action to reduce emissions beyond the emissions trading scheme mechanism, including the Clean Car Standard.

Simon Court: That’s right.

Hon MICHAEL WOOD: The member confirms that is an accurate conveyance of that party’s views. So what New Zealand needs to understand is that they can rely on this Government to make the policy changes to reduce carbon pollution, but any alternative Government with the National Party and ACT Party working together would pull down all of the progress that we have made to clean up our vehicle fleet—

Simon Court: That’s right.

Hon MICHAEL WOOD: He confirms that’s right. That would be the price of the ACT Party coming into Government. They oppose this very strongly. They even oppose this bill, which is a pragmatic way, which responds positively to what the sector has asked us to do. They are so trenchantly opposed to action—positive action on climate—that they would even oppose this legislation which smooths the way and makes it easier for the sector to comply with the Clean Car Standard. That is how dogmatic they are in their opposition to the Clean Car Standard in any of these policies.

So let’s be clear that under an alternative Government, all the measures that we have put in place to make clean cars more available and cheaper would be gone, and clean cars would become more expensive and more scarce under a National-ACT Government. That has, effectively, been confirmed in the debate today. And what the public can see through the Government’s passage of this piece of legislation is that we do remain committed to cleaning up our vehicle fleet. And let’s just remember the benefits of that: less carbon pollution, more choices for consumers, cheaper lifetime costs for consumers who get into cheaper vehicles, and, actually, much cleaner air for people. The Health and Air Pollution in New Zealand 3.0 report, which was released in July, on the impact on transport emissions on human health, reveals that we have 2,200 New Zealanders who die prematurely each year because of air pollution caused by the transport sector. Around 13,200 cases of childhood asthma are caused by that carbon pollution.

So there are multiple reasons why it is extremely important we move forward with a carbon dioxide standard. That is what our Government is doing. That is what we would not get from an alternative Government. This piece of legislation is a pragmatic way of implementing that to make sure it can be implemented smoothly by the sector. We get all of the benefits—the over 1 million tonnes of carbon abated between now and 2050. We get all of the benefits of that under this bill, but we simply have a smoother way of implementing it for the sector. The sector has welcomed that publicly and I thank them for the pragmatic way that they have worked on that.

I thank all parties in the House who are supporting this legislation. As I said at the beginning of my first reading speech, it’s Doughnut Day in Parliament. The National Party have now “doughnut-ed” on this one, but it’s a positive move that they’re now supporting the Clean Car Standard. I hope they keep making “doughnuts” and actually become a climate-friendly party at some point in the future. I commend the bill to the House.

ASSISTANT SPEAKER (Hon Jacqui Dean): The question is that the motion be agreed to.

SIMEON BROWN (National—Pakuranga): That was the Hon Michael Wood, the worst Minister of Transport that New Zealanders have ever had, and I hope he enjoys his doughnuts—big red zero. But the point is that this Minister of Transport can’t even fix the potholes, and now he’s here, bringing legislation to fix a stuff-up in legislation that he was warned would need to be fixed back in February. What has this Minister actually achieved in transport in New Zealand? How many potholes are peppering the highways? Fifty thousand—50,000 potholes—peppering our highways. Even in Tauranga. Even in the Bay of Plenty. Even in the “Waimak”. Speed limit reductions. He’s wanting to reduce speed limits. That’s about the only thing he’s managing to actually do—reduce a few speed limits. Can’t do light rail, wants to solve the climate crisis with light rail, which embeds more carbon emissions than, actually, if you did it another way. Cycle bridge. You can’t build a cycle bridge to try and cut cycle emissions—cycle emissions or car emissions. Cancels roads.

Then, what he didn’t talk about is how much coal—how much coal—this Government is bringing into the country, three times as much coal as was being imported under National. The Huntly coal-burning power station is going overtime because this Government has not been able to get the investment in renewable energy that is required. And that is the absolute shame of this Government. They’re woke virtue signalling on climate change, trying to tell us and lecture the National Party about what should be done, when they are the ones importing the dirty Malaysian coal to keep the lights on. That’s the reality of this Minister of Transport and his Government’s record when it comes to climate.

So while we support this piece of legislation to fix this stuff-up, we do say to this Government that, actually, we don’t support where the current Clean Car Standard is set at, because what it is doing is it’s actually going to make things go backwards even further. We’ve already heard today that the New Zealand Police can’t even buy utes for their fleet anymore because—

Todd Muller: What about the farmers?

SIMEON BROWN: —none of the importers—and what about the farmers and the tradies? Because the Clean Car Standard to be has been set at such a standard, and such a tight standard, that our farmers, our tradies, and those people who don’t have choices currently will not be able to get the vehicles that they need. So for all that the Minister stands up and talks about how this is going to mean we get cleaner vehicles into the country—well, actually, he forgets two things. One is that he can’t dictate to car manufacturers around the world what type of cars they’re going to produce. We’re a very, very small country. The EU, the Japanese standards—they are the people who will set the standards. We need to make sure we’re actually able to get those vehicles. But, at the same time, we shouldn’t be punishing those who don’t have a choice or where there isn’t the supply available at the moment, like for our farmers and our tradies.

So the message from the National Party is very clear: we will get rid of the “feebate”. The “feebate” which is the reverse Robin Hood scheme which is taking money from farmers and tradies and it’s giving it to people in the inner city leafy suburbs to buy their very expensive Teslas—the Teslas they can already afford to purchase, thank you very much, and that are being subsidised by those who don’t have a choice and from those on lower income. This is the Labour Party, the party of the worker—the party of the worker—they used to be. They’re now the party of the Tesla—they are the party of the Tesla. They’re helping Elon Musk out more than they’re helping the people in South Auckland. That’s what this Government’s track record has been: helping the Malaysian coal industry and helping Elon Musk to bring in more Teslas. They’re not helping the workers. They’re not helping the people doing it tough. They’re not helping our farmers, the backbone of our economy, who got our economy through COVID-19. They’re not helping any of those people, but they’re helping those who can already make those choices.

So we’ll get rid of the “feebate” scheme and we will make sure that the standard is something which is achievable, but which also ensures that those who require vehicles like utes for their work—farmers and tradies—and, now, we learnt, even our police, who are doing it tough enough, thank you very much, who need those type of vehicles to respond to emergencies and can’t wait around—

Hon Judith Collins: What about the dog handlers?

SIMEON BROWN: —and the dog handlers—and actually have jobs to get to and can’t plug their ute in for 14 hours to wait for it to be recharged. Those people actually need to have options, they need to have choices, and this Government is taking those choices away. We will stop that and we’ll make sure that there is accessibility for those people so they can get the vehicles they need, whilst, at the same time, reducing emissions over time in a sensible, pragmatic way. We work with the industry and we don’t keep stuffing it up, bringing legislation to the Parliament every five minutes, and we still don’t get an apology from the Minister—he doesn’t even say sorry. He can’t even say to the Parliament, “I’m sorry, we stuffed it up.” Can’t even say that. That’s the arrogance of the man who wants to be the next Prime Minister of New Zealand.

Well, I can tell you what, New Zealanders won’t accept that level of arrogance. They’re sick and tired of that arrogance. They want change. They want a Government which will actually listen to them, which will actually address the cost of living, which will ensure that we’re not screwing over our car market here in New Zealand, and actually making sure we have pragmatic solutions to address the climate challenges and the issues that we have facing New Zealanders. We will fix this law when we win the next election, but we will support this because it is making a small, tiny, little difference, and we will do anything which helps make a small, tiny, little difference. But we’ll fix it once and for all when we get into Government. Thank you.

SHANAN HALBERT (Labour—Northcote): Thank you, Madam Speaker. That was a disappointing speech from the Opposition spokesperson on transport, Mr Simeon Brown. He continued to tell us what he won’t do, he talked a big game on pragmatic solutions, but the reality is that the National Party has to tell us how they are going to reduce emissions. That is the problem that we are all trying to solve there. And for people that live in the Coromandel, you can see it first-hand, the impacts of climate change.

Coming back to this bill—because it’s important that we acknowledge this piece of work. As the chair of the Transport and Infrastructure Committee, I heard first-hand from submitters their contribution when we put this particular bill through the submission process, and we did hear very strongly from industry the importance of a just transition, enabling them and supporting them to take this piece of legislation on board.

That’s what we achieve by the Land Transport (Clean Vehicles) Amendment Bill (No 2), and I commend this bill to the House.

Hon SCOTT SIMPSON (National—Coromandel): Well, as the member who has just resumed his seat, Mr Shanan Halbert, shakes the dirty coal dust from his hands and blows it away in the notes that he’s been prepared, the reality is that Labour’s dirty little secret about climate change, and this particular policy area that they want to muck around with again, is that coal imports are at record levels under this Labour Government—and they’re burning it to make electricity. We used to use good New Zealand natural gas, but now they use imported Indonesian coal, so that’s Labour’s dirty little secret: that emissions continue to go up under this Government.

So here we are, under urgency, discussing a bill that is a Labour Party stuff-up. It wouldn’t have been so bad if the Minister who aspires to be Prime Minister before the next election and to take over from the leadership of the Labour Party, and he wants to make fewer mistakes—he’s the Minister of Immigration, he’s the Minister of Transport, and he is the Minister for Labour Party stuff-ups.

Here we are, trying to amend a mistake—several mistakes, in fact—that were made during rushed, not-well-thought-through legislation presented by this current Government. They were warned at the time—not only by us in the Opposition—that there were flaws and unintended consequences of their rushed legislation around this piece of legislation. They were warned, more importantly, by the car sector, the car industry themselves, who had made it very clear that the New Zealand Transport Agency would not be able to meet the time frame deadlines that the original legislation had put in place, that they were too ambitious, that they were largely put in to provide some speaking bullet points for the Minister, without any thought about the practical reality of the implications.

Well, now, we are here in urgency making amends for the Minister’s mistake. The Minister didn’t even have the good grace to come to this House and apologise, not even the good grace to acknowledge that the mistake was his, that it was his arrogance and his inability to understand the practical reality of his portfolio area, and he did not even have the good grace to come to this House and apologise—not only to the members of this Parliament but to the people of New Zealand—for his egregious errors, and just another one in a series of egregious errors that that Minister has been making. In fact, what he did do was come to this House and just insult members of the National Party, and particularly my colleague the Hon David Bennett, who, for some reason, seems to have incurred the ire of the Minister. He told the truth about the Minister and the Minister didn’t like it; the Minister didn’t like hearing the truth. Well, in the Labour Party, they don’t like hearing the truth, they don’t like hearing reality, and they just like to stay in their own little echo chamber of self-aggrandisement, self-affirmation, and they don’t stay in touch with the real people these days.

Simeon Brown made the point, “What happened to the Labour Party of the working people? What happened to that Labour Party of Michael Joseph Savage?” Michael Joseph Savage would be rolling in his grave if he could see the impacts of this piece of legislation that has promoted thousands of rich Tesla buyers able to purchase cars using free money that has been collected from people who have little choice, and, by and large, often do not have an ability to pay. Those are the people—it’s a reverse Robin Hood scheme, as my colleague Simeon Brown has mentioned on many occasions. It’s a reverse Robin Hood scheme, and we will put it right.

On this side of the House, we actually do believe in equity of outcome; we do believe that if the State is to be involved in people’s lives, then it needs to be on an equitable basis. That the current Government has no clue how to do that is an embarrassing shame upon them. If they spent a little bit more time actually listening to ordinary New Zealanders, they wouldn’t be in the electoral trouble they are in now. If they spent a little bit more time listening to trade sectors and the industry sector, who give them good advice, they would not be in the electoral trouble that they are now.

Notwithstanding all those matters, we are supporting this piece of legislation. As Simeon Brown has said, it is a small, incremental, beneficial change to a flawed piece of legislation—but it does make it slightly better. On that basis, and that basis alone, we are supporting this legislation, notwithstanding that it’s here, being rushed through the Parliament, under urgency, without any prospect of a full select committee scrutiny and hearings where people could make submissions, where the Minister would have to be accountable for his egregious errors, and where members of the Labour Party backbench—actually, some of their last actions as parliamentarians should have been to sit in a select committee and hear about the mistakes that they’ve made. Well, they have avoided that neatly by rushing this legislation through Parliament, under urgency, without that kind of scrutiny and without that kind of feedback that they actually do need to hear.

So, on that note, we will support the bill, but, by crikey, it would have been very, very helpful if the Minister had come to the House and apologised to the members of this Parliament and to the people of New Zealand for his very gross and obvious mistakes.

TERISA NGOBI (Labour—Ōtaki): Thank you, Madam Speaker. After all the pollution coming from the speaker who just took his seat, the Hon Scott Simpson, it’s really good to hear that they do support the electric vehicles (EVs) and they do support this bill. So thank you for that.

We’ve traversed this bill, I think, to its nth degree. We can all agree that reducing our carbon emissions, and supporting New Zealanders to be able to afford options, including EVs and hybrids and clean cars, is the important message to take away here.

We know that the bill provides three legislative measures: a six-month phase-in to give importers time to adjust to the standards, a clarification around the extension of the standards, and a technical correction to enable the refund of charges imposed. We know that this shows that this Government is listening. We’re nimble. We’re flexible. We’re listening to our importers. We’re able to move when we need to on legislation. This also shows that this Labour Government is continuing to support New Zealanders. For that reason, I commend this bill to the House.

Hon JULIE ANNE GENTER (Green): Tēnā koe, Madam Speaker. In my first speech in this debate, I talked about how important it is that we have meaningful action on climate change and transport, where we have huge opportunities to get benefits right across the board by making it easier for New Zealanders to live and get around in ways that use less carbon and cause less harm to the environment, because the less we use fossil fuels and the more energy efficient our transport system is and the more land efficient it is, we will be taking action on climate change but we’ll also be making it easier for people to get around towns and cities in terms of the financial costs. So it’s one of those areas where what’s good for the environment is good for people and is good for the economy, and we do have to address different market distortions that have led to this situation we’re in.

Now, most OECD countries have had fuel economy standards for quite a while now, and many have had a type of price incentive on cleaner vehicles to help support people to buy vehicles that consume less fossil fuels. And it’s fair and reasonable for those who buy more fuel-inefficient vehicles—gas-guzzling vehicles—that use more petrol and diesel, that they make a contribution to that, because the way that we pitched this or explained it at the time when we went out in consultation on this policy quite a few years ago was that not everybody can get into an electric vehicle or a low-emissions vehicle, but that everybody who’s getting a new - to - New Zealand vehicle can be part of the solution. And the way that they’re part of that solution, if they’re buying a gas-guzzling vehicle, is that they’re helping to chip in to get more low-emissions vehicles on the road. And that’s how we all work together to reduce our emissions as a country. Of course, there is a classic way of pitching this in a kind of individualistic way that says there are winners and losers from the policy. But I think it’s entirely fair that those who are buying more polluting vehicles make some contribution to cleaning up the rest of the fleet, because we’re all responsible.

Now, some people have suggested that we can do everything through the emissions trading scheme (ETS), and that’s really interesting. When it comes to vehicle efficiency, we know from evidence that the only policies that work are fuel economy standards and price incentives at the point of purchase of the vehicle. We can’t do it through ETS on fuel, and that’s why transport fuels actually aren’t in the ETS in Europe, but they lean very heavily on fuel economy standards and price incentives, and that works very well. It’s really because when people are making a choice about purchasing a vehicle, the ongoing cost of fuel is not something they’re thinking about well into the future. And the technology to have more fuel-efficient vehicles is a little bit more expensive for the manufacturers, and so they make bigger profits off less efficient vehicles. And so if you don’t have standards, then they supply less efficient vehicles to the market, and we had clear evidence of that. So, you know, Toyota Corolla—no, wait, what was it? Yeah, a Corolla, or other vehicles of similar nature, consumed more fuel per kilometre in New Zealand and Australia than they did in the UK. Now, left-hand-drive vehicles—wait, it’s right-hand-drive vehicles that drive on the left—that are supplied to the UK or Japan. Those are the big markets and they have fuel economy standards, much higher ones than New Zealand. So there’s really no issue with supply other than that without the standards, we actually struggle to get the supply of low-emissions vehicles in New Zealand for people to buy.

And that’s why the standard’s so important. We’re well behind on bringing standards in, because they were cancelled in 2009, or late 2008, by the last National Government. So New Zealand’s really, really far behind, and if we’re going to address our need to respond to climate change, then we have to do something about the vehicles that are coming in. So the discount and the standard have worked together. We’re already seeing a huge drop in average fuel consumption per kilometre since the discount was brought in. The Green Party is not voting for this bill, because it’s delaying the implementation of the standard, which we think we just don’t have time to do.

But I do feel that there’s a lot of misinformation or disinformation that comes around from the National Party on these topics. They keep talking about coal consumption. If their Government had done something about phasing out coal from Huntly and having a plan for a transition to renewable electricity, then we wouldn’t have had this problem during the dry years. But you can’t magic up that type of storage in just a few years. It’s just not possible. These are huge investments. Huge planning has to go into finding these solutions, and the truth is that the last National Government didn’t care about climate change, didn’t do anything to futureproof our electricity system, partially privatised the energy companies, and then they blame the Government of the day for importing coal, as if we didn’t have, you know, a wholly independent organisation that was responsible for making those decisions. You know, it’s Genesis that makes the decisions about how much coal gets imported. But that’s why we need a national strategy and why the Greens were calling for a plan to phase out coal from Huntly 20 years ago. And this was brought up in the debate, so I just feel I need to correct—it’s very confusing for people at home when they think that the Government is responsible for importing coal or that—

ASSISTANT SPEAKER (Hon Jacqui Dean): Order! David Bennett will just calm down.

Hon JULIE ANNE GENTER: —somehow poor people are paying fees in the “feebate” system, which is ridiculous because the only people buying new - to - New Zealand vehicles, which were the most polluting vehicles, which contribute to the fees, are people who can afford extremely expensive brand-new vehicles. The most polluting vehicles are these luxury sport utility vehicle (SUVs) like Range Rovers and Land Rovers. Those are the most gas-guzzling vehicles. I see a lot of brand-new Range Rovers driving around Central Wellington, carrying one person. It is their choice, and it’s their choice to pay an additional fee to get some more zero-emissions vehicles on the road.

So the truth is that the National Party doesn’t care about equity. If they did, they would have different tax policies and different income support policies. These policies are about reducing emissions, and it’s a fair and empirical way—it’s a way in which we actually have evidence that this is going to work to reduce our emissions as a country. And we can work together to do that. But if the National Party cares about equity and helping poor people, then they might want to look at their tax policies and their income policies and their proposal to make things easier for landlords, and maybe they’d like to look at rent freezes and they’d like to look at their minimum wage policies. There’s all sorts of policies you can do to help working people, and subsidising highly gas-guzzling, luxury SUVs and double-cab utes—which are really, largely, lifestyle vehicles in the leafy, wealthy suburbs—is not the way to get a fairer New Zealand.

They are just misleading about that, because, in truth, they don’t have any policies that are going to work to reduce emissions. And we saw that when they were in Government. Luckily they had lots of rainy years, so they didn’t have to worry about dry-year storage for renewable electricity, but they implemented zero policy to actually increase the uptake of zero-emissions vehicles and low-emissions vehicles, and you can see a clear difference between when National was in power and they did press releases with other people, with private investment installing vehicle chargers but the Government doing nothing about it. You can see, now, we have a huge uptake in low-emissions vehicles. That’s because of policies like the Clean Car Discount and standard, which make it available to people. They make those low-emissions vehicles available to more people, and they provide an incentive to buy them. And so that’s why that is a logical policy.

I remember when Todd Muller said that he supported the policy. He was in a television interview. It was wonderful. There used to be National Party members who were curious about problems and interested in evidence-based solutions, but, sadly, that’s not where we are today, and I think it’s very sad for our country because we do need to work together and we do need evidence-based policies, not ideological claptrap, driving what we’re doing to solve the climate crisis. The people of this country and our children and our future generations deserve politicians across the House who are going to be curious and open to effective solutions and who will work together instead of standing up and misleading and just making things up about how policies work.

Hon David Bennett: Point of order.

ASSISTANT SPEAKER (Hon Jacqui Dean): Point of order, the Hon—

Simon Court: Oh, Madam Speaker.

ASSISTANT SPEAKER (Hon Jacqui Dean): Sorry, I’m dealing with a point of order.

Hon David Bennett: Earlier in the day, the Minister was accused of exactly the same thing, and the member was asked to withdraw and apologise. And that member has actually been proven incorrect in select committee last week—

ASSISTANT SPEAKER (Hon Jacqui Dean): OK. All right. Thank you. [Interruption] No. Thank you. The member—[Interruption]. No. The member—[Interruption] No. The member started out OK and then strayed into a debating point.

SIMON COURT (ACT): Oh, thank you, Madam Speaker. Look, for the benefit of New Zealanders listening to this debate today or watching Parliament TV at 12.45 on a Thursday afternoon, hoping to get some insights into the thinking behind this Government’s and its support partner’s, the Greens’, approach not just to climate policy but to policies that they believe are for the betterment of New Zealanders, I want to quote a French philosopher—Albert Camus—who said, “The welfare of humanity is always the alibi of tyrants.” That’s how New Zealanders feel about not just one ute tax but ute tax 2.0, which is what this Government is imposing through this piece of legislation. Now, this French philosopher was known as an absurdist because he used to write stories, essentially, looking at the futility of searching for meaning in an incomprehensible universe.

What we’ve experienced today in Parliament is the futility of searching for meaning in an incomprehensible policy and regulation, because the Minister of Transport was right: the ACT Party firmly believes that the emissions trading scheme, the market-based scheme which puts a price on carbon emissions, is, in fact, the only logical and rational way for New Zealanders to pay for emissions, and creates an incentive to reduce the amount of carbon they emit, and that no other policy is required. We know that because the Climate Change Commission said that in their advice to Government: no other policy is required except an emissions trading scheme, and they even set a price of about 50 bucks a tonne of carbon that will be enough for New Zealand to reach its net zero carbon goals by 2050.

What we have today is an emissions trading scheme price of $88.40 a tonne—I know because I’ve just looked that up—and if you fill up your car, your ute, your truck and trailer unit, or your digger, or your boat, for that matter, with diesel right now, you’ll be paying 23.5c a litre for your emissions under the emissions trading scheme, because when you buy diesel, you pay for your emissions. And if you’re buying petrol for your car or if you’ve got a really fast V8 ski-boat or a jet-ski, then you might be paying 20c a litre for your emissions. So not just car drivers; even people who use boats recreationally pay for their emissions under the emissions trading scheme. We think, at about 20c or 23c a litre, that’s enough of an incentive to use less fuel.

We know it must be about the right price because the Labour Government recently reduced the fuel excise duty by about 25c because they said that was hurting Kiwis too much. Well, I’ll tell you what: 23.5c a litre on the emissions trading scheme for diesel—that’s enough of an incentive to use less. Buy a more efficient truck, buy a more efficient digger, and actually decide whether we’re going to take a sailboat out today or whether we’re going to put diesel in the big launch and go out cruising.

Now, look, the Minister said that without this piece of legislation, New Zealand will suffer greater expense and a scarcity of low-emission vehicles coming to New Zealand—a scarcity. Well, it’s simply not true. The vehicle manufacturers who came to the Transport and Infrastructure Committee last year made it very clear. They said, “Here’s the scenario you face, New Zealand: between 2015 and 2018, the car manufacturers built a whole lot of factories around the world to produce things like the current model of Toyota Camry, for example, which is actually—some of them are hybrid. All of those current models that come out of factories in South-east Asia, Japan, Korea, and Europe were built in factories that had a 10-year model design life.” What these manufacturers told us is that between 2025 and 2028, all of their factories will be retooled to make, pretty much exclusively, battery and hydrogen electric light vehicles. By 2030, you won’t be able to buy anything except an electric vehicle of some kind, coming to New Zealand as a new vehicle. So the scarcity that the Minister warned about is a false flag. It’s fake news. It’s not just misinformation; it’s disinformation, and the people of New Zealand need to know that.

Now, what will this tax at the wharf do? Well, it’s going to put hundreds of dollars, if not thousands, on to the price of a new or used vehicle—like a ute, like a courier van or an SUV or a people mover, which large families depend on—when it hits the wharf. That’s on top of the tax that you pay at the dealership now under what the Minister calls his Clean Car Discount—what ACT calls the “ute tax”, which takes money from people who need to buy larger petrol and diesel vehicles and hands it to the wealthiest New Zealanders so they can buy Teslas.

Now, what the Minister said was without this charge, actually we won’t get all of these low-emissions vehicles—complete nonsense. We can only get the vehicles we can get because there’s a worldwide shortage of supply. Taxing New Zealanders twice now—this is ute tax 2.0—won’t make another single battery or hydrogen electric vehicle pop out of a factory miraculously in Japan with this tax. It’s complete nonsense—the policy doesn’t work.

The Minister also pointed to pollution. He mentioned that thousands of people die every year in New Zealand because of petrol and diesel vehicles. Well, I didn’t see that as a problem in his Road to Zero policy, where he proposes to reduce speed limits and stop New Zealanders driving. He doesn’t mention pollution, but, if he did, this is what I’d say. Since I got my driver’s licence back in the 1990s, New Zealand’s removed lead from petrol. That caused brain damage and did kill people. We don’t have lead in our petrol anymore. We’ve removed sulphur from diesel. Sulphur in diesel used to cause heart problems as well as lung problems; we’ve removed it. If you drove around New Zealand, in any of our major cities on any given day, you wouldn’t be able to see, let alone smell, any pollution whatsoever. Another false flag disinformation hashtag fake news Minister Michael Wood.

So what are the options? The Government could intervene in markets like they are. They could subsidise like they are with ute tax 1.0, subsidise Teslas. They could tax people’s vehicles. Well, they’re doing that with ute tax 1.0, ute tax 2.0—this bill we have here in the House today. That’s what Governments could do—they could intervene. Or they could do what ACT proposes. Get your hands off the wheel, Minister. Let New Zealand drivers decide their own destiny.

Now, the emissions trading scheme, which I mentioned before, you already pay for your emissions if you put petrol or diesel in your car, truck, boat, bus. That raises about $1.5 billion a year, and that’s the money that this Government, with the help of climate Minister James Shaw, sees fit to allocate to all their pet projects. I’m talking about the Energy Efficiency and Conservation Authority Government Investment in Decarbonising Industry fund, which hands out hundreds of thousands of dollars—millions of dollars, in fact—to big businesses like breweries and dairy companies, to upgrade their energy systems, converting from, say, coal to electricity. Sounds great. Who knew that breweries and dairy companies need the help of the taxpayer in order to replace old equipment with new equipment? But that’s what this Minister in this Government thinks is helping save us from climate change.

This is what ACT says: take that billion and a half dollars that this Government is currently handing out to pet projects, buying political favours, engaging in corporate welfare, and give that money back to Kiwis. ACT would give the revenue, the one and a half billion from the emissions trading scheme, back to New Zealanders in the form of a carbon tax dividend. About $250 per person—that’s $750 to $1,000 per household. Every year, the emissions trading scheme sets a cap on emissions; no other policy tool is required. The emissions trading scheme has a price on emissions; no other policy scheme is required. The revenue from that scheme, Kiwis have paid it. They paid for their emissions, and what ACT says is give the money back to New Zealanders so they can decide whether they want to invest in low-emissions vehicles, buy a heat pump for the home, or simply pay the bills like putting diesel or petrol in the family car.

That is what ACT would do. New Zealanders will agree with us—2023 election can’t come soon enough. Thank you.

HELEN WHITE (Labour): Thank you. I want to actually reply to Mr Court’s latest statement that, in fact, it was fake news when there was a discussion about the deaths caused by the emissions from the vehicles that we’re trying to change over by this policy. I just googled—if you look at the Otago Daily Times from 7 July 2022, that study is reported as saying that 3,300 people are killed each year by that. Those are often people in a city. The highest one in this particular study was Invercargill. But I’ve been concerned for a long time that in our cities we get places where people live, particularly children, and they get killed by this kind of thing. Yes, we got rid of lead, and absolutely we should. Yes, we got rid of toxins, and absolutely we should. Now we must do this, Mr Court—we must do it—and we are doing it and we are proud of doing it. Yes, we will respond to the needs that the industry has for us to slow down a little, if it’s to keep everyone in the camp. But I’m certainly absolutely rejecting the idea that it is fake news to consider clean car emissions as an issue that we are making up. We are not making up climate change and we are not making up this. Thank you.

ASSISTANT SPEAKER (Hon Jacqui Dean): Members, the debate is interrupted and will resume this afternoon. The House is suspended and will resume at 2 p.m. for oral questions.

Debate interrupted.

Sitting suspended from 12.57 p.m. to 2 p.m.

Oral Questions

Questions to Ministers

Question No. 1—Finance

1. INGRID LEARY (Labour—Taieri) to the Minister of Finance: How is the Government responding to changing economic conditions in New Zealand and globally?

Hon GRANT ROBERTSON (Minister of Finance): The Reserve Bank, in its Monetary Policy Statement, is forecasting the economy will grow robustly in the second half of 2022 and the first quarter of 2023 by a collective 1.8 percent, for a period of negative growth totalling 1 percent GDP. Global growth forecasts continue to deteriorate, and the IMF is expecting economies either to be in recession, or be in conditions that feel as if they are, next year. We have consistently acknowledged that 2023 is going to be a tough year for New Zealanders facing global cost of living pressures and rising interest rates. As we clearly signalled in May’s Budget, we are cutting our cloth on the pathway back to surplus. Government spending as a percentage of GDP is forecast to fall considerably over the coming year, from 35 percent to 31.6 percent.

Ingrid Leary: What does Budget 2022 say about the impact of Government spending on the economy?

Hon GRANT ROBERTSON: The Treasury’s measurement of the impact of Government spending is the fiscal impulse—this is forecast to turn negative in 2022-23 and remain so throughout the remainder of the forecast period. This indicates that the Government is forecast to contribute less to aggregate demand each year than in the previous year. It is clear that 2023 will be a difficult year. Our approach has put New Zealand in a strong position to deal with the challenging global environment and its impact on New Zealand. We will continue to strike a balance of responsibly managing our finances, targeting support to where it is needed the most, and investing in a resilient economy.

Ingrid Leary: How else is the Government responding to the changing economic landscape?

Hon GRANT ROBERTSON: We continue to prioritise our spending so we target support to where it is needed most without exacerbating inflation. For example, we’re easing cost of living pressures for a number of New Zealand families by improving access to, and the value of, childcare assistance. Over one-half of all New Zealand families with children will now be eligible for subsidised childcare assistance, and over 10,000 additional children eligible for support.

Ingrid Leary: What approach is the Government adopting in regard to fiscal policy as economic conditions change in New Zealand and globally?

Hon GRANT ROBERTSON: We will continue to take a long-term and careful approach to fiscal policy. More than ever, a consistent and balanced response is important to provide the certainty that is needed in a volatile environment. This is what got New Zealand through the one-in-100-year economic shock of COVID better than most, and puts us in a strong position to deal with the challenges ahead. This is the time for calm heads and measured responses. It is not the time for knee-jerk responses and policy U-turns which leave New Zealanders confused and unsure and lowers trust on the path forward as we navigate this challenging time.

Question No. 2—Finance

2. NICOLA WILLIS (Deputy Leader—National) to the Minister of Finance: Does he agree with the Reserve Bank Governor, Adrian Orr, who said yesterday that “we’ve got too much home-grown inflation”; if so, what additional steps, if any, is the Government considering to reduce pressure on home-grown inflation?

Hon GRANT ROBERTSON (Minister of Finance): I agree with the statement in its full context. It was in an exchange where the Governor said, in relation to Government spending, that “Over recent times, it’s been broadly neutral if not slightly negative fiscal impulse.” To answer the second part of the question: the Government is taking a number of steps to both reduce pressure on inflation and reduce the pressure on households from inflation. This includes running a contractionary fiscal policy while making sure we are targeting investments to where they are needed most, such as increasing childcare assistance, the family tax credit, benefit levels, superannuation, and the minimum wage. We will of course continue to look at our fiscal policy to ensure that it does support monetary policy, while balancing that with taking pressure off New Zealand households as we all face this global inflation crisis together.

Nicola Willis: Will he be heeding the Reserve Bank Governor’s call for the Government to spend more sensibly this Christmas, or is it just Kiwi families that will have to do without?

Hon GRANT ROBERTSON: As I said in answer to the primary question and, indeed, in answer to question No. 1, the Government understands the importance of disciplined fiscal policy. That is why there is a contractionary fiscal impulse into the future and why our spending as a percentage of GDP returns to the long-run average of 30 percent.

Nicola Willis: Was Adrian Orr right to suggest this morning that the Government’s immigration settings are a handbrake on our economy?

Hon GRANT ROBERTSON: I’m not sure that’s a completely fair depiction of that. But what I would say is that immigration is an area where I know that New Zealanders are looking to see some improvement in terms of the number of people who can come in for jobs. That’s the reason why the Government did the immigration reset that we did. I note, within that immigration reset, currently the job-check process of that has seen 85,943 New Zealand positions approved, but work visa applications sit at 24,031. What that indicates is that employers have been given the right to bring someone in on a visa but they are in a very competitive global employment market that makes it tough. We will continue to look at our immigration settings so that they can support the workforce that we need in New Zealand.

Nicola Willis: Does the Minister understand that a job check and a visa process does not amount to a nurse working in a hospital, a worker on a farm, or someone helping a small business through the cost of living crisis?

Hon GRANT ROBERTSON: I absolutely understand the importance of getting people here into New Zealand to fill the skill gaps we’ve got. The point that I was making in that answer was to be clear that there is, everywhere in the world, global labour shortages. What New Zealand is doing is competing in that market. We have a process now that is far more effective and efficient than what we have had. But, as I said, we will always continue to look to ways to tweak our immigration settings to make sure they can fulfil their goals.

Nicola Willis: Does he agree with economist Brad Olsen, in reference to the Reserve Bank, that “They’re quite clearly saying there that the Government is contributing to inflation”, or will the Minister continue to dodge responsibility and keep playing the blame game?

Hon GRANT ROBERTSON: Again, I don’t think that’s a fair depiction of what the Reserve Bank has been saying. Yesterday, in the press conference, they also discussed the issue of the fiscal impulse, and the chief economist at the bank talked about the fact that it shows that, basically, the fiscal impulse has been flat as far as consumption goes, and that is what they feed into their model. It is a challenging time in terms of how we can contribute and manage within fiscal policy. I do note that the member’s party consistently over the last couple of years, as the Reserve Bank has been increasing the official cash rate (OCR), have been calling for stimulus. In October 2021, they did this, then again in late 2021, then again in February 2022. As the OCR was being increased, the member’s party was calling for more stimulatory activity in the economy. The member cannot have it both ways.

Chlöe Swarbrick: What specific fiscal policy, if any, will the Government undertake to support low-income New Zealanders who will be disproportionately impacted by the upcoming recession that the Reserve Bank Governor admitted they were engineering in response, triggering questions this morning?

Hon GRANT ROBERTSON: What we have done is what we will continue to do: make sure that our middle-income New Zealanders are properly rewarded. That includes the changes we’ve made to childcare assistance and the increases that are happening with the family tax credit. As we have shown over the last couple of years, we will seek to find opportunities to support low and middle income people while not unnecessarily exacerbating inflation.

Nicola Willis: Why should New Zealanders trust his assertion that Government spending will fall one day in the future—maybe—when that Minister has blown every single operating allowance he has ever set in a Government Budget, and will he confirm that the operating allowance he will announce in a few weeks will be the same as he projected in the Budget?

Hon GRANT ROBERTSON: I challenge the assertions that the member has made because the way that we measure our Budget and our fiscal policy in New Zealand is whether or not, for example, we keep debt under control. We have debt at one of the lowest levels in the OECD. We have a pathway back to surplus; we have seen economic growth. New Zealanders know that in difficult times—and in a crisis—this is the Government that has their backs and takes a balanced approach. That is what we will continue to do.

Nicola Willis: Will he follow the lead of the Reserve Bank Governor, who today apologised to New Zealanders for the role the Reserve Bank had in allowing inflation to be higher and to persist longer than it might have otherwise, and to therefore contribute to the interest rate rises we’re experiencing, or does that Minister continue to believe he has nothing to feel sorry for?

Hon GRANT ROBERTSON: I heard what the Reserve Bank Governor said this morning, and I join with him in saying that I am very sorry that New Zealanders are in the circumstances they’re in. What I also know is that we have worked very hard as a Government to ensure that those circumstances are significantly better than those of people in other parts of the world. I would much rather be facing this particular crisis with unemployment at 3.3 percent, with an economy where our debt is among the lowest in the OECD. They are the things that we have done to prepare ourselves for this moment. We do not need knee-jerk reactions, because we have taken an approach that is balanced and careful and puts New Zealand in one of the strongest positions of any country in the OECD to deal with this situation.

Nicola Willis: Why, when domestic inflation is forecast to keep climbing to 7.4 percent early next year, does he persist in trying to hoodwink New Zealanders into believing that this is all global factors?

Hon GRANT ROBERTSON: The point I was making in that answer—and obviously I reject all of the assertions in the member’s question—was that this is a difficult and challenging time for every country in the world. What New Zealand is in the position of is being able to face that with unemployment low, with people in work, and with wages rising. It doesn’t stop it from being a challenging time; it doesn’t stop it from being a time in which we as a Government have to take seriously our fiscal responses. But what I’d invite the member to do is think about the fact that every central bank in the world is needing to deal with this. Every Government in the world is needing to deal with this. We, as a country, have got ourselves to a strong position. It will be tough, but at least the country knows that they’ve got a Government that will back them.

Question No. 3—Immigration

3. RICARDO MENÉNDEZ MARCH (Green) to the Minister of Immigration: Does he consider that current immigration policies are fair and equitable towards migrant families?

Hon MICHAEL WOOD (Minister of Immigration): Yes, I do, noting that there are always balances to be struck with an immigration policy. I note that last week I announced that Immigration New Zealand will be prioritising 2021 resident visa applications from applicants who are currently separated from their offshore partners and/or dependent children. In addition to this, the Government has a number of other policies which are making a positive difference for migrant families, including reopening and updating the settings of the parent category visa, which were closed in 2016; reopening the skilled migrant category; doubling the refugee quota; and forming a migrant community reference group. I’m committed to pursuing an immigration policy that treats our migrants with respect and dignity, and that’s exactly what our Government is focused on.

Ricardo Menéndez March: Does he believe migrant nurses and teachers earning less than $86K a year should qualify to bring their parents to live in New Zealand on the parent residency visa; if not, why not?

Hon MICHAEL WOOD: The member is referring to the parent residency visa pathway that our Government did recently reopen after it was closed by the previous Government in 2016. As a part of that policy, we increased the cap over what had previously been proposed to 2,500 per year, we reduced the income thresholds, and we also made it more flexible to reach the income thresholds by enabling siblings to join their incomes together to reach those thresholds. The reason that the thresholds are in place, however, is about striking a balance whereby we do not want a situation where elderly migrant parents might come into the country but not have sufficient support to look after their welfare when they are potentially unable to support themselves. That is a balance that we try to strike. It’s a balance that most countries have. I do note that we do have other visa pathways that do enable families in New Zealand to connect with parents from other countries on a more temporary basis.

Ricardo Menéndez March: Has he heard concerns that migrants experiencing visa delays or, potentially, rejection of their visa as a result of accessing mental health services face increased stigma and ill mental health; if so, what steps are being taken to address this?

Hon MICHAEL WOOD: I haven’t directly heard of any of those concerns, but what I would assure the House is that in respect of the “acceptable standard of health” policy, which has been a longstanding part of our immigration policy, there is no differentiation between physical illness and mental health conditions. We do believe that it is reasonable that, as most countries do, there is an assessment as to whether there might be significant health costs that would fall to the public purse as a result of migration. Our Government has recently increased the “acceptable standard of health” threshold from $41,000 to $81,000 and removed a number of conditions. So we do always look to ensure that it’s as facilitative and as reasonable as possible, but, ultimately, I don’t think it’s unreasonable that any Government does have that basic assessment within the immigration system.

Ricardo Menéndez March: What further advice or work is he awaiting, if any, before making decisions following his comments that “The Government does not have a closed mind” on a regularisation initiative for overstayers?

Hon MICHAEL WOOD: The question of regularisation is one that has been raised in a number of quarters over the course of the last year, and the member is correct that I have said that it’s not one that I have a closed mind on. It is, however, a complex area. Any Government that does want to consider that policy will need to be mindful of precedent, mindful of how such a policy could be operationalised, mindful of equity issues between people who might benefit from such a policy and people who have already voluntarily self-deported. Those are the sorts of complex issues that any Government would have to work through before it made a decision in that area, and, as I indicated to the member last week, it is an area where I have asked for advice from officials. It’s one that I will work through very carefully.

Teanau Tuiono: Is the Minister concerned that under-aged, undocumented migrants aren’t able to fully participate in their communities, and, if so, will he introduce an amnesty for overstayers?

Hon MICHAEL WOOD: I refer to my previous answer, which is that the Government hasn’t made a decision to that effect, but it’s one that I have sought further information and advice from officials on.

Teanau Tuiono: Why are Pacific countries such as Tonga and Samoa not on the visa waiver list?

Hon MICHAEL WOOD: As we’ve canvassed in the House, New Zealand operates an immigration system whereby some countries are subject to visa waiver. In many countries in the Pacific and elsewhere, residents do need to have a visa to enter New Zealand. That has been a part of our immigration system for a long time. It is a part of the assurance that we seek to ensure that people are going to—when they are planning to come to New Zealand, they are doing so on a bona fides basis, and I’m reasonably satisfied with that policy at this stage. I note that the vast majority of people from the countries that the member references do successfully receive their visas after they have applied for them.

Question No. 4—Education

4. ANGELA ROBERTS (Labour) to the Minister of Education: What reports has he seen about trends in the number of New Zealanders in apprenticeships?

Hon CHRIS HIPKINS (Minister of Education): I’ve seen a report that the number of Kiwis learning on the job as an apprentice has increased from 29,965 to 57,105. That’s an increase of 91 percent or over 27,000 more apprentices training today than there were 5 years ago.

Angela Roberts: Has the number of women apprentices kept pace with the overall increase?

Hon CHRIS HIPKINS: Actually, no. The growth for women has significantly outpaced the growth for men, albeit from a low base. The number of women in apprenticeships has more than tripled—a 224 percent increase from 2,540 to 8,240.

Angela Roberts: What industries have seen the largest growth in apprenticeships?

Hon CHRIS HIPKINS: The construction sector has been the biggest contributor to overall apprenticeship growth. Construction apprentices have increased by 105 percent from 12,755 to 26,150. That’s more than 13,000 more construction apprentices. Another significant area of growth has been healthcare and social assistance, which has had 400 percent growth from 455 to 2,275 apprentices, 74 percent of whom are women.

Angela Roberts: Has the growth in apprenticeships been primarily amongst young people?

Hon CHRIS HIPKINS: No. There has been a 78 percent growth in the number of apprentices under the age of 20, but there has been even bigger growth in older age groups. There has been a 189 percent growth in the number of apprentices aged 40 and above.

Question No. 5—Immigration

5. ERICA STANFORD (National—East Coast Bays) to the Minister of Immigration: Does he stand by all of his statements and actions?

Hon MICHAEL WOOD (Minister of Immigration): Yes, I do, in the full context that they were made. In particular, I stand by my statement last week welcoming the significant increase in working holiday visas that have arrived in the country ahead of summer. I can inform the House that, as of today, 18,737 such people have now arrived in the country, and that has been supported by changes that the Government has made to increase—to double, in fact—the Competence Assessment Programme (CAP) scheme numbers for the coming summer. I look forward to seeing this strong trend continue as we prepare for a bumper summer tourism season.

Erica Stanford: Why, after Treasury’s economic update in October 2021, which stated, “Labour shortages continue to pose barriers to growth and will keep inflationary pressures elevated.”, did the Government not move more quickly to allow skilled workers to apply for the accredited employer work visa (AEW visa) in March rather than July?

Hon MICHAEL WOOD: Because, through the first part of 2022, New Zealand was still dealing with a significant COVID-19 outbreak, and one of our primary measures of defence was to have protections at our borders. It may have escaped the member’s recollection but during that period we faced the biggest outbreak of COVID that our country has seen. Our Government has moved forward this year with the reconnection strategy, which saw all of our main visa categories open up as of July, and, as the year has gone on, we have moved forward to open up the skilled migrant category, to increase the number of people coming through the working holiday visa scheme, to increase the Recognised Seasonal Employer (RSE), the CAP scheme, to open up the Green List, and other changes that show our commitment to making sure that we do reconnect with the world.

Erica Stanford: In light of that answer, does he agree with the Prime Minister, who said on 16 March, “The major issue here is not a question of safety but a question of the ability to process those new visas in a timely way.”, and, if so, is it the case that his department’s inability to process AEW visas in March this year has exacerbated labour shortages and elevated inflationary pressures?

Hon MICHAEL WOOD: Well, to some degree the member points to a statement of the obvious in respect of every country around the world, which is that as every country used border protections to keep safe from COVID-19, it was challenging to access international labour. What we have done since July is open up all of our major categories. We have provided over 85,000 job check approvals, which are approvals for employers to be able to recruit temporary labour offshore. We have provided approvals for over 13,000 work visas to enable those people to come into New Zealand, and, as I just said in my primary answer, over 18,000 working holidaymakers have now arrived in New Zealand, following on from about 38,000 of those applications having been approved. So I do believe that our immigration system is providing approvals to workers to get into New Zealand, but the member does need to reflect on the fact that every single country around the world faces these challenges because of a global labour shortage. The member can wave her hands around and point to some of these challenges; what we actually need are practical policies to actually help New Zealand employers and workers, and the member and her party offer nothing in that regard.

Erica Stanford: Given that only 2,569 AEW visa holders have arrived to 11 October, what does he say to a business owner who called me yesterday and said, “By the time we get workers in the country next year, according to the Reserve Bank we’ll probably already be in recession and will have wasted the opportunity we had this year to get workers we desperately needed.”?

Hon MICHAEL WOOD: What I would say is that Immigration New Zealand has approved work visas for over 13,200 workers to enter New Zealand. Once that work visa has been provided, there is obviously some time for that worker to get themselves ready, to uproot their family, to make a plan to come to New Zealand, and then to come to this country. The immigration system has to have the right policies in place. It does need to ensure that it processes applications in a reasonably timely way, but there are some factors within the system that are actually down to the people involved, and one of those will be the time it takes for someone to come to New Zealand after a work visa has been issued.

Erica Stanford: Given that answer, then, why is it that the Government didn’t move more quickly at the end of 2021 to get businesses accredited and get job checks done so that we could get workers in the country from March, rather than waiting until July, giving them much more time to enter the country?

Hon MICHAEL WOOD: Well, I’m quite sure that we could have a fine old time going through statements made by members on that side of the House about when our borders should be open and when our borders should have been closed as we were dealing with the COVID-19 pandemic. But our Government makes no apologies for the fact that we put the health of New Zealanders first as we were dealing with the global outbreak at its peak. During that period, we continued to fill critical skill shortages through the critical purpose visa, which enabled workers to come to New Zealand, in areas where there were particular needs, in a controlled way. And we have then moved forward this year to open up other visa categories through the immigration rebalance. We do need to have policies that make a real difference in this area, but going back and relitigating history and pretending we didn’t have a global pandemic to deal with isn’t a sign of anyone who’s ready to make good policy.

Erica Stanford: Who is right, then, the Minister who’s telling us today that everything’s fine and dandy, or the Reserve Bank Governor, Adrian Orr, who, this morning, on Mike Hosking Breakfast, said, “It is a handbrake. More labour would be better without [a] doubt, [it’s] loud and clear … and everyone has told the Government that.”

Hon MICHAEL WOOD: As I said before in an answer to a question, it’s all very well to point to challenges that we face, and no one is saying that there are not challenges that we face. We have a record-low unemployment rate, which is a good thing, that does create challenges in certain parts of the labour market, and we need to access international labour to fill some of those gaps. What our Government has done over the course of the past year has been to put in place an immigration system that helps us to do that, and I’ll go through some of those steps again. We’ve opened up the accredited employer work visa system. We’ve got the skilled migrant category reopened. We’ve reopened the parent category, which makes it more attractive for people to come to New Zealand, which a previous Government closed. We’ve got the green list system open. We’ve increased RSE numbers. We’ve increased working holiday visa numbers. Those are the practical steps that we have taken in dealing with a global labour shortage that every country is trying to deal with. One thing I’ll say that’s a positive difference between the ACT Party and the National Party is they’ve actually put out some ideas for things that we could do in the immigration system today—I think many of them are terrible, but at least they’re putting forward some ideas for debate, unlike that lot who just complain with no solutions at all.

Hon Gerry Brownlee: I raise a point of order, Mr Speaker. What was it in the question that was asked of Mr McAnulty—of, sorry, they look similar, Mr Wood.

Hon Kieran McAnulty: Take that back.

Hon Gerry Brownlee: Sorry. That was—quite right—

SPEAKER: This is a point of order.

Hon Gerry Brownlee: —I withdraw and apologise, Kieran. My apologies. It was a genuine mistake. What was it in the question that was asked of Mr Wood that meant that you were prepared to tolerate the sort of answer that he gave to the House?

SPEAKER: No, no, you’re absolutely right. He shouldn’t have brought the ACT Party into it on a question from the National Party. I will give the ACT Party one extra question, and the National Party one extra question.

Erica Stanford: Why haven’t his immigration settings responded to the nine consecutive official cash rate (OCR) hikes that referenced critical labour shortages, including, yesterday, when the Reserve Bank said that businesses remain held back by severe labour shortages that are unlikely to ease in the near-term.

Hon MICHAEL WOOD: We have responded to those challenges. One of the differences about being in Government and the member’s position in Opposition is that we actually have to come up with solutions and policies to deal with the challenges that are in front of us. That is something that that member has not ever been able to bring herself to do. I’ve outlined to the House on multiple occasions the significant policies that our Government has put forward to deal with those challenges. They are challenges faced by every country around the world, and we will continue to work with employers to make sure that we do have good policies in place to address some of these challenges.

Nicole McKee: Thank you, Mr Speaker. Is the Minister supportive of ACT’s immigration policy, announced earlier today, whereby we state that all immigration policy decisions will be subject to a regulatory impact analysis, and, if not, why not?

Hon MICHAEL WOOD: I’ve only briefly seen the policy’s proposals that the ACT Party put out previously. I can assure that member that every significant policy that our Government does develop in the immigration area does go through that process and that now that we have come out of the COVID emergency period, we have put in place a commitment to have full consultation and normal policy processes around all of our significant policy areas. What I don’t agree with in the ACT policy is their policy to do away with any process of employers needing to check if there are New Zealanders who are available to do a job, and their policy of doing away with any controls around the wages that are paid to migrant workers, which we believe is an important thing to ensure that migrants aren’t exploited.

Barbara Edmonds: Is the Minister aware of the comments made by the Reserve Bank Governor this morning on the OCR uplift hearing with the Finance and Expenditure Committee that workforce shortages are a global issue and that other Reserve Bank Governors across the globe are asking where the people are?

Hon MICHAEL WOOD: Yes, I do agree with that assessment, and anyone who is serious about understanding immigration policy understands that these are global issues that are faced by virtually every developed country around the world. Our focus is on making sure that we have policies that do support employers in that area. That’s why we’ve given out over 85,000 job checks that give employers the ability to recruit internationally. That’s why we’ve made those increases to the RSE scheme and to the working holiday visa scheme. That’s why we’ve opened up the parent category that the National Party closed last time they were in Government. We have a record of actually putting in place practical policies, and we’ll keep doing that.

Question No. 6—Conservation

6. ARENA WILLIAMS (Labour—Manurewa) to the Minister of Conservation: What announcements have been made about supporting community-led conservation projects?

Hon POTO WILLIAMS (Minister of Conservation): Earlier this month, we announced that the Department of Conservation Community Fund—Pūtea Tautiaki Hapori opened for applications. The fund will support community-led efforts to protect threatened species and to promote Te Mana o te Taiao by providing community groups with grant payments. These payments will enable grassroots projects to continue their work in helping us resolve the biodiversity crisis and help us achieve our conservation commitments. Applications are open until Tuesday, 31 January 2023, and I encourage anyone who wants to help us support our conservation estate to apply.

Arena Williams: How much funding is being made available?

Hon POTO WILLIAMS: This round of community fund will make a record $9.2 million available for community groups, iwi, hapū, and private landowners who are supporting our conservation efforts across the country. The grants typically range from $5,000 up to as much as $100,000 for localised projects.

Arena Williams: What type of projects will be considered?

Hon POTO WILLIAMS: This year’s fund is divided into two streams: $7.2 million for biodiversity projects that reduce the extinction risk of priority threatened species or protect priority ecosystems and $2 million to protect cultural sites and maintain visitor infrastructure. Projects funded in the past have included intensive and focused predator control programmes to protect endangered species, significant weed removal projects, as well as fencing and riparian planting on lake edges and in wetlands.

Arena Williams: When will the successful applicants be announced?

Hon POTO WILLIAMS: Applications for the fund close on Tuesday, 31 January 2023. Those who wish to apply can do so via the Department of Conservation website. The Department of Conservation will consider all applications and inform successful applicants in April 2023.

Question No. 7—Police

7. CHRIS BAILLIE (ACT) to the Minister of Police: What changes will the Government make to its response to retail crime, after the fatal stabbing of a dairy worker in Sandringham last night, if any, and will the Government now remove the criterion that a retailer must first be a victim of crime in order for them to access funding from the Retail Crime Prevention Programme?

Hon CHRIS HIPKINS (Minister of Police): I’d like to begin by acknowledging the tragic event in Auckland last night. I commend the efforts of the first responders at the scene, and extend sincere sympathy to the victim, their family, and to the local community. As I’ve indicated previously, I have already been reviewing the criteria to access the retail crime prevention fund. On the information that I have available at the moment, it’s not clear why the particular business concerned didn’t have a fog cannon installed as part of the first stage of the programme, which began back in 2017. I have asked for more information on that—I have not yet received a detailed explanation around that. It isn’t possible for the taxpayer to subsidise security measures at every retail business in New Zealand, and, therefore, there does need to be some criteria that guide who does and who doesn’t get access to those subsidies. However, as I’ve indicated, I am continuing to review them.

Chris Baillie: Why should small-business owners have any confidence in the Government’s response to retail crime, given that only seven businesses have had installations completed under the Retail Crime Prevention Programme over the last six months?

Hon CHRIS HIPKINS: As I’ve indicated previously, I would have liked to have seen faster progress earlier; however, the retail crime prevention fund work has now accelerated, and we are seeing significant progress in areas like fog-cannon installations and upgrades, security sirens, alarms, CCTV, lighting, counter screens, store mirrors, window strengthening, bollards, planter boxes, roller doors, and so on. Of course, I would have liked to have seen some of that happening sooner, but I am confident that that work is now—as we indicated—accelerating.

Chris Baillie: What does the Minister say to the serving police officer who said, “Well, it was only a matter of time before a shopkeeper was killed in the current spate of robberies. If you allow people to offend without the risk of consequences, there will be no fear for the bad people. Shame on those who have allowed things to get so out of control in New Zealand.”?

Hon CHRIS HIPKINS: I’ve not seen that particular quote and I don’t intend to comment on an individual reported comment without knowing the authenticity or the source of it.

Chris Baillie: What does the Minister say to dairy and business association chair Sunny Kaushal, who said, “As for the Prime Minister, we’ve never had a single reply despite asking to meet.”, and does he think the MP for Mt Albert should visit the family of the victim?

Hon CHRIS HIPKINS: I can say that I have personally met with Mr Kaushal and his group, and, as follow-up action, so have the police—they have had at least one in-person meeting and several follow-up interactions to respond to the various proposals and issues that have been raised.

Question No. 8—Environment

8. DEBBIE NGAREWA-PACKER (Co-Leader—Te Paati Māori) to the Minister for the Environment: Will he undertake any specific actions to ensure the resource management reforms have the active consent of tangata whenua, in response to concerns expressed from tangata whenua leaders regarding the Natural and Built Environment Bill and the Spatial Planning Bill; if so, what are those actions?

Hon PHIL TWYFORD (Associate Minister for the Environment) on behalf of the Minister for the Environment: On behalf of the Minister, the repeal and replacement of the Resource Management Act (RMA) will address the longstanding problems with the current system while saving Kiwis hundreds of millions of dollars. Reform is overdue. Everyone is frustrated with the RMA—environmentalists, developers, councils, farmers, home builders, and tangata whenua. Ministers and officials have regularly engaged with Māori throughout the two-year development phase of these bills, and for the year prior to that with the Randerson panel. Tangata whenua, of course, aren’t one amorphous group, and different iwi and hapū have different views on aspects of the reforms. As the member will be aware, the Natural and Built Environment Bill and the Spatial Planning Bill are currently before the select committee for consideration. The Minister for the Environment is not going to cut across the committee’s role in scrutinising and proposing improvements to the bills. However, the Government will be seriously considering all public submissions and the reports of the Environment Committee on the bills, and I encourage tangata whenua and all interested members of the public to make submissions to the committee.

Debbie Ngarewa-Packer: What is his response to the National Iwi Chairs Forum who are urging caution in highlighting that the scale and pace of the reforms cannot be implemented on the ground?

Hon PHIL TWYFORD: On behalf of the Minister, I would just stress that there has been an extensive period of preparation for these reforms, and engagement on a weekly basis between officials of the Ministry for the Environment and the Ministers the Hon David Parker and the Hon Kiritapu Allan, and we now have a full select committee process to consider all of the issues contained in these two bills.

Debbie Ngarewa-Packer: How many post-settlement governance entities or iwi organisations have explicitly endorsed the RMA reforms, if any?

Hon PHIL TWYFORD: On behalf of the Minister, I haven’t been briefed on that precise number, but I’m sure that if the member puts the question in writing, the Minister would be happy to respond to it.

Debbie Ngarewa-Packer: How can he claim environment protection is improved under the reforms when they actually weaken baseline environmental protections by removing the requirement that environmental limits safeguard the life-supporting capacity of ecosystems?

Hon PHIL TWYFORD: On behalf of the Minister, it’s widely accepted, I think, that the RMA—as well as being expensive and slow, stopping our towns and cities from growing—simply hasn’t done a good job of protecting the environment. The new planning system is explicitly designed to strengthen environmental protection, including by having the concept of environmental limits at its heart.

Debbie Ngarewa-Packer: Will he amend the bill so that the environmental limits require the restoration of ecosystems from their current state, rather than preventing ecosystems degrading further from their current state; if not, why not?

Hon PHIL TWYFORD: On behalf of the Minister, the concept of environmental limits is not based on the notion that future degradation is merely prevented; it is about restoring, over time, the ecosystem to its un-degraded state.

Question No. 9—Digital Economy and Communications

9. Dr TRACEY McLELLAN (Labour—Banks Peninsula) to the Minister for the Digital Economy and Communications: What recent announcements has he made about improving rural connectivity in some of New Zealand’s most remote locations?

Hon Dr DAVID CLARK (Minister for the Digital Economy and Communications): More good news. I recently had the pleasure of announcing that the Remote Users Scheme has started taking applications from eligible households. This scheme will target some of New Zealand’s most remote communities and connect them with broadband for the first time. These are places where there is currently only access to voice calling and text services. Homes and communities where the internet is very slow and its use is limited will also be targeted. This is all thanks to an allocation of $15 million in Budget 2022, and was part of a broader $60 million fund for rural connectivity.

Dr Tracey McLellan: How many households will this benefit?

Hon Dr DAVID CLARK: Crown Infrastructure Partners are mailing forms with return envelopes to over 3,000 households with very poor or no coverage. They have also engaged with community groups, who are helping to spread the word and are putting posters up in libraries, supermarkets, Farmlands stores, and other community hubs. Just because you live off the grid, it doesn’t mean you can’t be connected; it’s just that sometimes it takes a bit of tailored thinking.

Dr Tracey McLellan: Why is this scheme important?

Hon Dr DAVID CLARK: As the global cost of living crisis puts pressure on New Zealanders and their families, a reliable connection will make it easier for remote businesses to operate and pay invoices, and to network. From a social standpoint, this scheme will also help connect people to online health services and education tools.

Dr Tracey McLellan: What reaction has he seen following the announcement?

Hon Dr DAVID CLARK: Federated Farmers is urging its members to sign up to the scheme. In fact, Richard McIntyre, the Federated Farmers telecommunications spokesperson, called it a great initiative from the Government and something they’ve been advocating for. This Government knows the importance of having reliable connection in rural New Zealand. We’re listening to communities and delivering solutions.

Melissa Lee: Point of order, Mr Speaker. I seek leave to table the Federated Farmers of New Zealand rural connectivity survey of 2022, outlining the poor state of digital connectivity for rural New Zealand households, which said that only 1 percent of farmers in New Zealand have access to high-speed—

SPEAKER: Is that publicly available?

Melissa Lee: No, sir. You have to literally request the document. There is PR available.

SPEAKER: OK. Leave is sought for that purpose. Is there any objection? There is none. It may be tabled.

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

Question No. 10—Police

10. Hon MARK MITCHELL (National—Whangaparāoa) to the Minister of Police: Does he agree with the Dairy and Business Owners Group, who said, “The country is becoming lawless … Running a business in this country has become very difficult”; if not, why not?

Hon CHRIS HIPKINS (Minister of Police): No, as I don’t believe that inflammatory comments such as that are helpful in these circumstances. I’d also note that some of the proposals put forward by the group, including allowing business owners to take matters into their own hands, could risk further escalation and put more people at risk. While I have sympathy for every victim of offending, I think it’s important that police are allowed to do their jobs.

Hon Mark Mitchell: Why would the Minister characterise a comment like that as being “inflammatory” for a group that has suffered over 430 ram raids this year and has seen a friend and a member of that group killed last night in a fatal stabbing, and does he not actually understand and realise that there’s a very strong feeling out there amongst retailers and their employers that they do not feel safe?

Hon CHRIS HIPKINS: I absolutely acknowledge that there is concern amongst the small-business community—and the retail business community, in particular—around the recent pattern of offending that we have seen. I do want to provide reassurance that the police are working very hard to make sure that every one of those offences is fully investigated and that those who do them are held to account for their offending.

Hon Mark Mitchell: Did the Minister sign off and approve the criteria that allows business owners to have access to the retail crime fund?

Hon CHRIS HIPKINS: The criteria for that was approved before I became the Minister.

Hon Mark Mitchell: What are the criteria?

Hon CHRIS HIPKINS: There is a range of criteria—past victimisation being one of the key criteria. But it will also look at what the most appropriate security intervention is for that particular business. It’ll also look at the overall nature of offending within the community. It will look at a range of different issues.

Hon Mark Mitchell: So the Minister’s standing in the House and can’t tell us definitively what the criteria is for a fund that he’s been overseeing for the last six months and the business in Sandringham had applied for, including the request for a fog cannon that actually would have gone probably a long way towards preventing the tragedy that we saw unfold in Sandringham last night?

Hon CHRIS HIPKINS: As I indicated in my answer to another member’s question earlier, on the information that I have, the business should have been eligible to receive a fog cannon from as early as 2017, when funding was made available by Government for the installation of fog cannons at that time, and therefore I do not yet have an explanation as to why they have not received one.

Melissa Lee: Will the Minister personally join me on Saturday to visit businesses affected by ram raids and violent crime in Mount Albert and Sandringham?

Hon CHRIS HIPKINS: I have visited businesses that have been the victims of ram raiding. I am not in a position to do so this coming weekend. I also think it is important for all members of Parliament, where there is an active investigation under way, to allow police the space to do their jobs.

Question No. 11—Research, Science and Innovation

11. Dr ANAE NERU LEAVASA (Labour—Takanini) to the Minister of Research, Science and Innovation: How is the Government supporting a future-focused research system?

Hon Dr AYESHA VERRALL (Minister of Research, Science and Innovation): As part of the Government’s work to build a future-focused research system, we’re making research more accessible for everyone with a new open research policy. The policy requires all publications from new research projects funded by the Ministry of Business, Innovation and Employment (MBIE) to be made free to access online for everyone. Open access to research increases its impact by enabling more people to access scientific information and engage with research. This, in turn, increases the innovation potential of our research and maximises the return on public investments in science.

Dr Anae Neru Leavasa: Who will benefit from open research?

Hon Dr AYESHA VERRALL: Open research is about making publicly funded research available to everyone that could benefit from it. From our innovators and entrepreneurs to students and research collaborators, there are many people who will benefit from accessing the outcomes of research efforts.

Dr Anae Neru Leavasa: How does this policy change meet international expectations?

Hon Dr AYESHA VERRALL: Open access requirements are increasingly becoming the norm internationally. With this move, we are taking a similar approach to Australia, United States, the European Union, and the United Kingdom.

Dr Anae Neru Leavasa: What other actions will further support researchers?

Hon Dr AYESHA VERRALL: In addition to open research, this week MBIE has launched the option to use a new narrative CV template for funding applications. The alternative approach reflects the increasing diverse range of contributions that researchers bring to their work and provides a more rounded picture of an individual scientist’s career, their achievements, and overall contributions to research, and enables a broader definition of an academic for Māori and Pacific peoples. Scientists applying for grants will be judged on a more meaningful assessment of their skills and experience and, of course, the strength of their ideas.

Question No. 12—Local Government

12. SIMON WATTS (National—North Shore) to the Minister of Local Government: Does she stand by her statement made to the House yesterday that the establishment of the principles of Te Mana o te Wai “included a number of stakeholder groups: rural communities; yes, Federated Farmers; it included industry users; it included horticulturalists, as well as iwi”; if so, why can only mana whenua submit Te Mana o te Wai statements under the Government’s three waters reforms?

Hon NANAIA MAHUTA (Minister of Local Government): Yes, I do. In addition to that statement, I also made another comment yesterday in the committee when I said, “We’ll do that through scale and aggregation separating balance sheets. We’ll do that through ensuring good governance. We’ll do that through ensuring that the Crown’s Treaty obligation is built into the reform process. We’ll do that by ensuring that there is no privatisation.”

Simon Watts: Thank you very much, Mr Speaker. Why can mana whenua submit a Te Mana o te Wai statement on a river that runs through their land, but a farmer who isn’t mana whenua cannot submit one for a river that runs through theirs?

Debbie Ngarewa-Packer: Point of order. I believe that the member is being improper in improperly using w’akapapa.

SPEAKER: The question is in order.

Hon NANAIA MAHUTA: Te Mana o te Wai statements are developed by iwi mana whenua groups, and they’re developed not just for the benefit of Māori; in fact, it’s for the combined benefits of communities, the environment, and the way that we think about the intergenerational challenge of looking after our most precious resource, water—everyone benefits.

Simon Watts: If the goal of Te Mana o te Wai is to improve water quality, why can’t people who aren’t mana whenua but have expertise in water quality submit these statements?

Hon NANAIA MAHUTA: Communities have different ways of being able to reflect their aspirations. Certainly, on private land they can do that, but in the nature of water catchments, they can do that through other groups and other opportunities.

Hon Kelvin Davis: To the Minister’s knowledge, have any of the groups mentioned in the primary question, other than iwi, ever had cause for a Treaty settlement bill, as mentioned in clause 140(1)(b) as a condition for submitting a Te Mana o te Wai statement?

Hon NANAIA MAHUTA: No, but it would be a novel approach.

Simon Watts: If non - mana whenua industry users and rural communities are qualified to have a view on water quality, why are they prohibited from submitting Te Mana o te Wai statements?

Hon NANAIA MAHUTA: Te Mana o te Wai statements are specifically for the purposes of iwi mana whenua groups to reflect their aspirations as they relate to a catchment. It’s for the benefit of the environment and communities, and when those aspirations are reflected well, everyone benefits.

Debbie Ngarewa-Packer: Point of order. The member is deliberately misleading the role of mana w’enua and our customary rights.

SPEAKER: Which member are you talking about?

Debbie Ngarewa-Packer: Oh, this member, sorry—beg your pardon, e te Māngai.

SPEAKER: No, that point of order is out of order, and I’m going to—every member in this House is an honourable member, and to accuse someone of deliberately misleading is out of order, to the point that the member will have to stand, withdraw, and apologise.

Debbie Ngarewa-Packer: I stand, withdraw, and apologise.

Simon Watts: Has she seen the statement from Federated Farmers released today titled “Countering misinformation on 3 waters, Te Mana o te Wai”, and, if so, how does she counter their allegation that the Government has misrepresented their views on Te Mana o te Wai?

Debbie Ngarewa-Packer: Point of order. I would like to seek your advice. I believe that the honourable member is being reckless with his opinion.

SPEAKER: No, and those sorts of points of order are not helpful for the order of the House. It’s likely to cause disorder. The member has the right to ask questions to hold the Government to account on an important policy, and the Minister, I’m sure, is quite capable of answering that question.

Hon NANAIA MAHUTA: In response to that question, I read very carefully Federated Farmers’ submission on the Water Services Entities Bill, and in that submission it was very clear that they asked that the concept of Te Mana o te Wai be fully described in the Act and any subsidiary legislative instruments in order to provide legislative certainty. They also said that they wanted issues around Te Mana o te Wai to be subject to further careful consideration to ensure that there is clarity for the water service entities, councils, and for water users, including how Te Mana o te Wai statements may influence resource under section 104 of the Resource Management Act.

Simon Watts: Point of order. My question was in reference to statements from Federated Farmers, released today. The Minister referenced a submission to select committee, which wasn’t the question I asked.

SPEAKER: Yeah, but it did address—

Hon NANAIA MAHUTA: Point of order, Mr Speaker.

SPEAKER: No. I’m dealing with this point of order. Did you want to speak to the point of order?

Hon NANAIA MAHUTA: Yes. In so far as that the primary question was the response that I gave in relation to submissions of Federated Farmers in relation to the Water Services Entities Bill.

SPEAKER: I did listen carefully to both the question and the response. The response did address the question.

Hon Kieran McAnulty: Does she stand by her statement made in the House that “The changes ensure that the new water entities … [will] keep a lid on … rates. At a time when the cost of living challenges confronting households are real, these reforms help lessen the burden of [rates]”; if so, what does she say to those that believe that the solution to this $185 billion problem is to do nothing?

SPEAKER: The question needs to be relevant to the primary or one of the answers—that was neither.