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Questions & Answers for Oral Answer 26 July 2005

( Uncorrected transcript—subject to correction and further editing. For corrected transcripts, please visit: )

Tuesday, 26 July 2005
Questions for Oral Answer
Questions to Ministers

1. Pharmac—Funding
2. Television New Zealand—“Culture of Extravagance”
3. Iraq—Combat Forces
4. Zimbabwe—Cricket Tour
5. Tertiary Education—Singalong Courses
6. Benefits—Working-age New Zealanders
7. Immigration Service—Investigations
8. Weathertight Homes Resolution Service—Claims Resolution
9. Schools—Unhealthy Food and Drink
10. Superannuation—Mâori Age of Eligibility
11. Transport Spending—Source of Funds
12. Taxation—Proposed Changes

Questions for Oral Answer

Questions to Ministers


1. Hon PETER DUNNE (Leader—United Future) to the Minister of Health: Is the Minister satisfied with the funding of Pharmac; if so, why?

Hon DAMIEN O'CONNOR (Acting Minister of Health): Yes, I am. Pharmac and district health boards have agreed upon a pharmaceutical budget for 2005-06. The budget for that year is $582.86 million, including $3 million for the Cancer Control Strategy. That budget is almost $20 million higher than last year. We are already negotiating a new 3-year budget for the coming years.

Hon Peter Dunne: How does the Minister therefore explain to the sufferers of multiple sclerosis, Alzheimer’s disease, rheumatoid arthritis, Parkinson’s disease, and other debilitating conditions—all of whom cannot get the medications they need—that neither Pharmac nor the district health boards requested any additional funding for those conditions during the last financial year, and that Pharmac managed to underspend its 2003-04 budget by some $20 million?

Hon DAMIEN O'CONNOR: Madam Speaker, to quote the questioner to himself, he has said that we all accept that there cannot be unlimited pharmaceutical spending. Pharmac has a very robust and independent process of assessing every application for new drugs in this country. Labour stands by that independent process, and believes that Pharmac is doing an outstanding job.

Steve Chadwick: Has the Minister seen any information that compares New Zealand rates of subsidised medicines with rates in other developed countries?

Hon DAMIEN O'CONNOR: Yes. The Canadian Institute for Health Information report on drug expenditure in Canada for the years 1985-2004 found that Canada subsidises 37.5 percent of medicines sold, the US subsidises only 19.5 percent, and Germany subsidises 74.8 percent. In comparison, New Zealand subsidises nearly 80 percent of medicines.

Barbara Stewart: Is the Minister aware of any plans that Pharmac may have to introduce the compulsory assessment of new hospital medicines, in effect allowing Pharmac to decide what new medicines will be available in New Zealand hospitals; if so, does the Minister intend to allow that extension of Pharmac’s operations?

Hon DAMIEN O'CONNOR: I am not aware of any intentions in that direction, at all. Pharmac works with district health boards to decide, on an annual basis, through an independent process, which drugs will be subsidised.

Heather Roy: Will the Minister instruct Pharmac to abandon sole supply and to purchase several brands of critical medicines, as it has been forced to do with the flu vaccine and after the public fiasco regarding Ventolin and Salamol, so that New Zealanders can be assured of continuity of supply for essential medications?

Hon DAMIEN O'CONNOR: We do ensure continuity of supply. There are issues that occur from time to time. Following the influenza experience, we will now have two suppliers of those medicines in the future. Ventolin will be subsidised, along with the other product, Salamol. I am very confident in the process we have to ensure that New Zealanders get access to the best possible drugs at reasonable prices.

Hon Peter Dunne: Does the Minister’s confidence extend to our ability to deal with H5N1, the avian bird flu, and to the fact that at the moment we have enough vaccine available from the drug Tamiflu to vaccinate only one in five New Zealanders, should that flu become established here?

Hon DAMIEN O'CONNOR: I understand that that is an international challenge. The Ministry of Health is working through with Pharmac to make sure that we are in the best position possible, should such a terrible outbreak occur.

Rt Hon Winston Peters: Why is the Minister’s administration, like the previous administration, seeking to defy gravity and allowing Pharmac to boast the following: that drug supply in this country costs one-third of the average spent on drug supplies in OECD countries, and 54 percent of that spent in Australia, which is surely testimony to the fact that New Zealanders are getting by on Third World drugs?

Hon DAMIEN O'CONNOR: No, as I pointed out before, we have one of the highest levels of subsidised drugs in the world. Pharmac has been able to negotiate, as sole purchaser, some very good deals with international suppliers of those drugs.

Hon Peter Dunne: Can the Minister confirm that the Australian Government has already taken steps to ensure that any vaccine made available in Australasia would, as a first priority, be available for Australians, and then for people in Singapore; and that Pharmac, the body he lauds so much, has in fact done nothing to order contingency supplies or to ensure that if there is an outbreak of avian flu in New Zealand, we are in line for any supplies of available vaccine from our near neighbours or other parts of the world?

Hon DAMIEN O'CONNOR: I do not accept that Pharmac has done nothing. It is continually updating itself with information from around the world on such possible epidemics. As I said, I have every confidence that we will be in a secure situation, should such a terrible outbreak occur. We work with the Australians in many areas—this one, as well.

Television New Zealand—“Culture of Extravagance”

2. Rt Hon WINSTON PETERS (Leader—NZ First) to the Minister of Broadcasting: Is he confident that he has curbed the “culture of extravagance” in Television New Zealand Limited and addressed issues that were the subject of a select committee inquiry; if so, why?

Hon STEVE MAHAREY (Minister of Broadcasting): Shareholding ministers have made it clear to the board of Television New Zealand Ltd that the Government expects Television New Zealand to manage its expenditure in an appropriate manner consistent with its objective of giving effect to the charter while maintaining sound commercial performance.

Rt Hon Winston Peters: Does the Minister remember these words from the Prime Minister on 14 December 2004, when she spoke of a “culture of extravagance which requires explanation to shareholding ministers”; is it not a fact that TVNZ’s continuing long history of reckless and wasteful expenditure of millions of dollars on perks, golden handshakes, exorbitant salaries, overgenerous wardrobes, unjustifiable credit card spending, and ritzy parties is testament to the fact that he has done nothing since the select committee inquiry of last year?

Hon STEVE MAHAREY: Yes, I remember the Prime Minister’s comments, and I have with me the report from the Commerce Committee on the briefing by Television New Zealand on credit card spending, clothing allowances, contracts, and the principle of transparency. In both cases the chief executive undertakes—or has already acted—to stop things that are inconsistent with the Government’s view.

Mark Peck: Is the Minister satisfied with the way TVNZ is performing financially?

Hon STEVE MAHAREY: I am very satisfied with TVNZ’s financial performance. Even the Minister of Finance is satisfied. Over the last 2 years Television New Zealand has generated record levels of advertising revenue, including $335 million in the year to June 2004 and $196 million in the 6 months to December 2004 alone. This strong advertising revenue has contributed to greater profits for TVNZ, enabling the Crown to reinvest $11.4 million in TVNZ’s 2003 to 2004 dividend as additional funding to implement its charter. I am also satisfied that TVNZ is accounting in a transparent way for every single dollar of its charter funding, which is committed to producing more high quality New Zealand content than ever before.

Hon Georgina te Heuheu: Does the Minister further recall the reaction of the Prime Minister at the time of Judy Bailey’s reported salary increase to $800,000, when the Prime Minister was reported as saying: “I think this was a spectacular mistake, but on balance they should go and fix it.”, and that if Bailey’s salary was as high as $800,000 for “four minutes on air a day,” the directors “have some explaining to do”; in light of furthering the TVNZ board’s considerations of Bailey’s upcoming salary proposals, will he remind the board of the Prime Minister’s strong views on the matter, or are we to regard her statements as just more evidence of the kind of hollow posturing that this Labour Government has become renowned for?

Hon STEVE MAHAREY: That was a strange question from a person who does not have a policy. Yes, I do recall the Prime Minister’s comments and I am confident that the board understands the Government’s expectations.

Rodney Hide: Point of order.

Madam SPEAKER: There is a point of order. The prefacing of that answer was unnecessary, if that is the point of order. The Minister will concisely address the question, please.

Hon STEVE MAHAREY: The answer is yes, and I am confident the board understands the Government’s view on those matters.

Rt Hon Winston Peters: How could the Minister, alongside his Prime Minister and colleagues, be happy with TVNZ’s performance, or attest to the fact that it is “accounting in a transparent way”—his very words 5 seconds ago—when this “culture of extravagance” at TVNZ just saw the taxpayer foot a bill for $52,000 for a midwinter sales party shindig in Auckland; how is that an effective use of moneys that are meant to go to the taxpayer?

Hon STEVE MAHAREY: The sales team of Television New Zealand recently hosted a midwinter function, which it does every year, to thank advertising agencies and major advertisers who use advertising agencies to advertise on Television New Zealand. These are people who provide advertising revenue that makes up 90 percent of the money that Television New Zealand gains in overall revenue, and the sum of money spent on that function would account for 0.06 of that advertising revenue.

Rt Hon Winston Peters: How on earth does the Minister or the Prime Minister justify $52,000 for a midwinter shindig; how long did it go on for, where was it held, and was he there?

Hon STEVE MAHAREY: No, I was invited but I was not there, because I am not one of the advertisers that contributes $335 million to the bottom line of that organisation. This is a common practice amongst organisations throughout the country, and it amounts to about 0.06 percent of the sum gained from advertising by Television New Zealand.

Stephen Franks: I raise a point of order, Madam Speaker. I seek your particular attention for the supplementary question I am about to ask, and draw your attention to Speaker’s ruling 133/2, a ruling by Mr Speaker Hunt: “There is no convention that Ministers are not answerable for operational matters.” I draw it to your attention because the question I am about to ask relates to something I asked on 3 May. The Minister’s response was a written response that simply stated that the question related to an operational matter of Television New Zealand and therefore fell within the responsibility of the Television New Zealand board, not shareholders. I merely ask that you pay particular attention to the way in which the Minister deals with the question, which I would now like to put.

Madam SPEAKER: Thank you, Mr Franks. Would you please put your question.

Stephen Franks: Does the Minister care how Television New Zealand achieves the financial performance that he has just been so pleased about, given that it is an organisation supposed to report facts and not to suppress them, and given that it has supported a Queen’s Counsel in repeated court applications for name suppression for a star so that it can save the programme ratings until the programme ends; if he has not been briefed on this matter, why not, given that I asked him written questions about it on 3 May 2005?

Hon STEVE MAHAREY: Yes; and this is obviously an operational matter for the board.

Stephen Franks: I raise a point of order, Madam Speaker. The Minister has given the excuse that I expected. I can point to other rulings to similar effect—it is not appropriate for a Minister simply to decline to answer on the grounds that it is an operational matter.

Madam SPEAKER: I thank the member for his point. That ruling means that the question will not be ruled out of order by the Speaker if it relates to operational matters. It does not prevent the Minister, however, from providing a reply in whatever manner he or she chooses to do so.

Stephen Franks: What will the Minister do if he finds that the facts are exactly as I have described them; and will he, as shareholding Minister, undertake to try to find out, so that he can assure this House that State broadcasters will not in future collude with a person accused of a serious violent sex offence to maintain the disgraceful secrecy of our criminal justice system, and to hold up broadcasting ratings and profits, of which he is so proud?

Hon STEVE MAHAREY: If any of these accusations are true, of course they would be a matter for shareholding Ministers to become involved in, but I have no evidence of that matter. Of course, the member has opportunities, in a select committee, to ask those questions directly of the board.

Rt Hon Winston Peters: I raise a point of order, Madam Speaker. I heard a comment to my left. The Minister probably did not hear it, but I am bound to come to his defence. He was accused of being a spineless Minister, and that simply—

Hon Ken Shirley: And a wimp!

Rt Hon Winston Peters: He was called a wimp and a spineless Minister. We know that the Minister can be called smarmy, but he cannot be called spineless. That member should be asked to apologise to the House now.

Madam SPEAKER: Does the Minister take offence at the term?

Rt Hon Winston Peters: Yes, I do.

Madam SPEAKER: It is not a prohibited term. You have taken offence. Does the Minister take offence?

Hon STEVE MAHAREY: I cannot take offence. I just feel sorry for the member, because he is leaving soon. That is all.

Iraq—Combat Forces

3. LUAMANUVAO WINNIE LABAN (Labour—Mana) to the Minister of Foreign Affairs and Trade: Would the Government accede to a request to send New Zealand troops into a combat role in Iraq?

Hon Dr MICHAEL CULLEN (Deputy Prime Minister), on behalf of the Minister of Foreign Affairs and Trade: No. The Labour-Progressive Government’s position has been absolutely consistent since before the start of the conflict in Iraq: we would not commit New Zealand to a combat role in Iraq.

Luamanuvao Winnie Laban: Has the Minister seen any reports of other proposals on this matter?

Hon Dr MICHAEL CULLEN: Yes, I have seen four. One was to indicate support for sending combat troops. The second was to refuse seven times in a row to state a position. The third was to state that no final position could be arrived at without official advice. The fourth proposal was to state that under almost no circumstances would combat troops be sent to Iraq. All of those came from Dr Donald Brash—three of them within the space of 5 days.

Gerry Brownlee: I raise a point of order, Madam Speaker. As the Minister is referring to various reports he has received relating to positions that he believes were taken by Dr Brash, perhaps he could explain to the House his extraordinary turn-round in giving such a generous tertiary package today, after saying just a short time ago that no money was available for such things.

Madam SPEAKER: I thank the member, but that is not a point of order.

Keith Locke: Is the Minister concerned that 39,000 Iraqis have been killed since the 2003 invasion and that many of the Iraqis detained by the American forces have been seriously mistreated; and is that the reason why New Zealand will not send combat troops to Iraq?

Hon Dr MICHAEL CULLEN: Clearly the Government is concerned at the number of deaths in Iraq, particularly the deaths of innocent civilians both during the invasion and subsequently as a result of a range of a range of terrorist actions. The reason why the Government has not sent combat troops to Iraq—and will not send them—is that the Americans were never operating under United Nations auspices and the invasion could, in fact, be regarded as illegal, as the United Nations itself has said.

Hon Peter Dunne: When the New Zealand Government committed forces to Iraq in a non-combatant role after the military invasion, was that done as a result of a decision made by this Government, or in response to a request from the United Nations or the United States?

Hon Dr MICHAEL CULLEN: It was a decision by this Government in accordance with United Nations resolutions.

Luamanuvao Winnie Laban: Has the Minister seen any reports assessing proposals to commit New Zealand combat troops to Iraq?

Hon Dr MICHAEL CULLEN: Yes, I have seen two. One stated that this issue has essentially gone and is no longer relevant at all. The second stated that it is too much to expect an answer from the man who wants to be Prime Minister on whether he would send our troops to war. The first assessment was from Dr Brash. The second, after an interview, was from a TV3 reporter.

Dr the Hon Lockwood Smith: Has the Minister seen the reports of the National Party leader, Don Brash, stating that he cannot conceive of a situation where New Zealand would send combat troops to Iraq; if not, would he like a copy of the transcript?

Hon Dr MICHAEL CULLEN: Yes. That was indeed the fourth position that Dr Brash adopted, and the third within 5 days.

Rodney Hide: Does New Zealand have the capacity to send combat troops to Iraq even if it chose to, and is that not the reason why the Minister of Defence said on 14 August 2003, when sending a team of engineers to Iraq, that if shooting was to start, their best option was to run?

Hon Dr MICHAEL CULLEN: That is a misquotation from the member. Of course, he is an expert in hiding rather than running.

Rodney Hide: I raise a point of order, Madam Chairperson. The Minister never addressed my question once, and I am quite happy to read out the full quote from the Minister of Defence in respect of the engineers being sent to Iraq. It states: “Yes to the first three questions. It sounds quite sensible to run away if fired at.” I would quite like my question to be answered.

Hon Dr MICHAEL CULLEN: The Minister has assured me that that is not what he actually said. Of course, whether the member was suggesting they should throw their shovels at them instead is another matter.

Madam SPEAKER: The point of order was not a valid point of order because the Minister did in fact address the question, in the sense that he took issue with the quote itself, which was the essence of the question.

Zimbabwe—Cricket Tour

4. ROD DONALD (Co-Leader—Green) to the Prime Minister: Does she stand by her statement that she “wouldn’t be seen dead” in Zimbabwe; if so, why?

Rt Hon HELEN CLARK (Prime Minister): Yes, because Zimbabwe is a nation in deep crisis, making it inappropriate to visit at this time.

Rod Donald: Does the Prime Minister believe that the resolution passed overwhelmingly by this Parliament today is a clear directive to the Black Caps not to play in Zimbabwe, and would that, therefore, get New Zealand off the hook without penalty; if not, why not?

Rt Hon HELEN CLARK: No, it is not a directive. The motion passed called on New Zealand Cricket to abandon the tour and it called on the International Cricket Council to take a more enlightened attitude to countries where there are gross human rights abuses. That does not amount to a directive in the terms understood by the International Cricket Council.

Rod Donald: Does she still regard my Zimbabwe Sporting Sanction Bill as “Mugabe-style legislation”, in the light of the Russell McVeagh legal opinion that confirms that my bill does not infringe the New Zealand Bill of Rights Act or restrict any individual’s freedom of passage; if so, why?

Rt Hon HELEN CLARK: Two wrongs do not make a right, as I said earlier in the discussion on the motion that the House has adopted. I note that the legal opinion obtained by the member appears to assert that New Zealand Cricket, as a legal person, may not enjoy the rights of a natural person, but even if it did, the legal opinion believed that the proposed restrictions would be a reasonable limit on the right to leave New Zealand. I cannot agree with that. The Government is opposed to the passage of legislation as proposed by the Green Party, which would seek to direct New Zealand Cricket, threaten its funding, and revoke recognition of it as a national sporting organisation if it toured Zimbabwe.

Rod Donald: Does she believe that the Electoral (Vacancies) Amendment Bill, which the Green Party supported and which passed through all stages under urgency without select committee scrutiny, was more important than stopping Robert Mugabe treating our sporting heroes as pawns in his obscene power game; if so, why?

Rt Hon HELEN CLARK: There is no correlation between the two. Plenty of bills are passed in this House under urgency. It so happens that the Government believes that the bill proposed by the Greens, which would purport to direct New Zealand Cricket and place upon it considerable sanctions, including financial penalties, if it did tour, is wrong.

Keith Locke: Does the Prime Minister have any concerns about the safety of the Black Caps if they do visit Zimbabwe; if not, why not?

Rt Hon HELEN CLARK: Personally, I do have concerns, because Zimbabwe is in deep crisis. One cannot rule out a country in such a crisis being a danger to people like cricketers who visit and who can end up in the wrong place at the wrong time, or in a place where there are violent demonstrations. Personally, I consider it unwise to go.

Tertiary Education—Singalong Courses

5. Hon BILL ENGLISH (National—Clutha-Southland) to the Minister of Education: Does he stand by his statements on the Agenda programme, with regard to ending the funding of singalong courses: “Yes … they went I think in 2003 and 2004”, and “Well I’d been briefed it’s off.”; if so, why?

Hon TREVOR MALLARD (Minister of Education): No. I was advised, when following this issue up yesterday, that there will be no further enrolments in these courses other than those being processed this week.

Hon Bill English: Why does this Minister insist on saying things to the public that are not true simply because they sound good in the interview, and when will he tell the public that by the end of this year radio singalong courses will have clocked up $9 million of public funding under his charge?

Hon TREVOR MALLARD: At the time that that member pleads guilty to being part of the Cabinet that put this system in place.

Hon Brian Donnelly: Can the Minister therefore reconfirm that the so-called singalong courses grew out of the “bums on seats” system established by the previous National administration, and that if there is any criticism of this Government it is that it did not move more quickly to eradicate such low-value programmes?

Rt Hon Winston Peters: I raise a point of order, Madam Speaker. Questions should be heard in silence. One does not mind a little bit of chatter, but I could not hear my colleague’s very sound question because of disclaimers coming from my right that I know are not true or correct. Could I hear the member ask the question again, please?

Madam SPEAKER: I thank the member. Yes, there was too much chatter that was bordering upon interjections. Perhaps the member would like to repeat his question quickly, so it can be answered with equal speed.

Hon Brian Donnelly: I thank you, Madam Speaker, and the Rt Hon Winston Peters. Can the Minister reconfirm that the so-called singalong courses grew out of the “bums on seats” system established by the previous National administration, and that if there is any criticism of this Government it is that it did not move more quickly to eradicate such low-value programmes?

Hon TREVOR MALLARD: I think the first part of the member’s question is absolutely accurate, and the second part is quite fair.

Hon Ken Shirley: Does he accept that Twilight Golf and ordinary golf courses fully funded to tertiary level—at university level—is in the same category as singalong courses; if so, will he concede that in the 2004-05 financial year Te Wânanga o Aotearoa received millions of taxpayers’ dollars to run courses in golf?

Hon TREVOR MALLARD: I do not have all those figures with me, but I would not be at all surprised at that.

Lynne Pillay: Has he seen a proposal to immediately abolish all community education courses run by tertiary institutions?

Hon TREVOR MALLARD: Yes, I have. It would, of course, mean the end of all the brilliant—[Interruption] I am sorry?

John Key: I said: “You’re a lightweight.”

Hon TREVOR MALLARD: Oh yes! No one has ever said that before. That was the productivity man. The answer is that yes, I have seen such a proposal. It would mean the end of the university extension work that has been going on in New Zealand for about 70 years. It would also mean that every polytech in the regions in New Zealand would close.

Rt Hon Winston Peters: With regard to this issue of the wânanga, which the National Party has made a huge song and dance about, was it National in 1999, by itself, that opened up the funding to the fiasco that it has become today—yes or no?

Hon TREVOR MALLARD: The answer is certainly yes, but whether the National members did it in anticipation of playing twilight golf through the latter part of 2005, when they have nothing else to do, I am not sure.

Hon Bill English: Has the Minister seen a briefing from the Tertiary Education Commission addressed to him dated April 2004, which sets out the details of a review of radio singalong courses to be completed within weeks, and why is it that he has taken until now to take any action on a course that he knows, and everyone else knows, has been a waste of $9 million of public money; can he explain that?

Hon TREVOR MALLARD: I went after $160 million a year, and got it.

Hon Bill English: Has the Minister seen the Eastern Institute of Technology website dated 26 July 2005, which shows that the institute is, as of lunchtime, still taking enrolments for a course in radio singalong that starts on 1 August and goes through to 23 September, and which, by the end of this year, will have clocked up $9 million of taxpayers’ money, and why should this House believe anything he says when no matter what he says, radio singalong keeps singing along?

Hon TREVOR MALLARD: The first point is that the funding for that area is capped, and, in fact, it is capped at half the level that it was at. The second point is that I have received an assurance from the chief executive of the Eastern Institute of Technology that there will be no further enrolments in that course after Friday.

Hon Bill English: I seek leave to table a copy of the Eastern Institute of Technology website, showing that enrolments are still current in radio singalong.

Madam SPEAKER: Leave is sought to table that document. Is there any objection? There is.

Hon Bill English: I seek leave to table a report of the Tertiary Education Commission to the Minister in charge of tertiary education dated 13 April 2004, and setting out the details of a review of radio singalong courses, on which no action was taken.

Madam SPEAKER: Leave is sought to table that document. Is there any objection? There is.

Hon Bill English: I seek leave to table a set of information taken from a series of parliamentary questions that shows that by the end of this year radio singalong will have cost $9.05 million of public money.

Madam SPEAKER: Leave is sought to table that document. Is there any objection. There is.

Benefits—Working-age New Zealanders

6. MOANA MACKEY (Labour) to the Minister for Social Development and Employment: What reports has he received on numbers of working-age New Zealanders receiving a benefit?

Hon STEVE MAHAREY (Minister for Social Development and Employment): The latest quarterly benefit figures from Work and Income show that the number of working-age New Zealanders on benefits has fallen in every region in the country over the past year, reaching a 17-year low. The number of New Zealanders on the unemployment benefit has reached a 19-year low, falling 26 percent in the last year alone. Domestic purposes beneficiary numbers have also fallen in every region, with the number of sole parents on the domestic purposes benefit now standing at an 11-year low. There are now 81,000 fewer New Zealanders on benefits than in 1999—a 22 percent reduction. There are nearly 100,000 fewer people on the unemployment benefit since 1999—a 66 percent reduction.

Moana Mackey: What have been the key drivers of this fall in the number of people on benefits?

Hon STEVE MAHAREY: There are a number of factors, including a strong economy, but also including the employment assistance policies of a Labour-led Government, such as Jobs Jolt and WRK4U, which the OECD last month confirmed has led to rapid falls in benefit numbers—more rapid—since 2003. The OECD now includes New Zealand in an elite group of countries it calls “job miracles”, where Government policies have contributed to dramatic falls in unemployment. Under the Labour-led Government, hundreds of thousands of opportunities have been created for New Zealanders, with a quarter of a million new jobs added to the economy. We will keep developing policies that will lead, once again, to the OECD identifying this country as one of the leaders.

Judith Collins: Can he confirm findings that in March 2005 60 percent of firms reported difficulties in finding skilled staff, and 49 percent of firms reported difficulties in finding unskilled staff, but that there are still almost 300,000 working-age Kiwis on benefits; and can he also confirm Treasury’s projections that under Labour’s policies the total number on benefits would increase?

Hon STEVE MAHAREY: I can confirm that firms have reported skill shortages and shortages of labour. It is lucky, therefore, that we have doubled the amount of money going into industry training, introduced the Modern Apprenticeships programme, and introduced job partnerships with industries right across the country. This problem would be even worse under National. In answer to the second question, no, I cannot confirm Treasury forecasts of what is going to happen. We have returned $3.3 billion already to Treasury because we have beaten the forecast, year after year.

Moana Mackey: Is the success in lowering the number of New Zealanders on benefits likely to continue?

Hon STEVE MAHAREY: Yes, it is. In the past year alone we have reduced growth in sickness and invalids benefit numbers by over 50 percent, and have begun to provide the most significant reform of the benefit system in 70 years. Our policies will help more New Zealanders move off benefits, into work. But, yes, this success is under threat. In the past week I have seen people advocating a return to the Work for the Dole scheme, which clearly failed; compulsory immunisation of children; and adopting out the babies of people on the domestic purposes benefit, as a way of getting those people back to work.

Judy Turner: Can he confirm that of the 10,406 people on the unemployment benefit at the end of January this year who were over the age of 60, 10,083, or 97 percent, had work-test exemptions; if so, why is he allowing significant numbers of people to spend their final working years on a benefit, when they could be retrained and used to fill labour shortages?

Hon STEVE MAHAREY: I certainly invite the United Future party to campaign on a work test for people who are 64 years of age. What we agreed to do was to introduce a work test for people who are between 55 and 60, but many people who are between 60 and 65 are moving through a transition period towards superannuation as their age moves up. We make available to all those people all assistance to move into a job if they would like to do so, but we are not planning to work test people aged between 60 and 65. We would welcome the member doing that. I would welcome that debate on the hustings.

Dr Muriel Newman: In light of the Minister’s own answers showing that almost 320,000 working-age adults, including spouses and partners, depend on taxpayer-funded benefits, why does he continue to mislead the public by claiming that the numbers dependent on benefits are significantly lower?

Hon STEVE MAHAREY: As at 30 June, the number of working-age beneficiaries in New Zealand was 290,466. When Labour came into Government it was around 400,000, from memory. That is a drop, I think, by my maths.

Dr Muriel Newman: I seek leave to table figures from the Minister that show that almost 320,000 working-age people are dependent on benefits.

Madam SPEAKER: Leave is sought to table that document. Is there any objection? There is.

Immigration Service—Investigations

7. Rt Hon WINSTON PETERS (Leader—NZ First) to the Minister of Immigration: How many files, categorised A, B, and C, if any, were investigated by the special team set up within the New Zealand Immigration Service and described by him on 3 May 2005, and how many files remain unresolved within each category?

Hon PAUL SWAIN (Minister of Immigration): The special team set up within Immigration New Zealand, which I described on 3 May 2005, is known as the immigration profiling group and does not categorise files by A, B, and C. The fraud and investigation unit, in an attempt to clear a backlog of cases in June, does categorise files by A, B, and C. I would be grateful if the member could clarify which one he is referring to.

Rt Hon Winston Peters: I raise a point of order, Madam Speaker. My point of order is very clear, and it is this. The A, B, and C files are categories he is very much aware of, which are to do with a unit he set up especially for that purpose, and he has had 4 hours to answer the details of this question. He knows full well, the moment I use the phrase “A, B, and C categories”, which group I am talking about. But he was the one who made reference to them on 3 May. Can I just have an answer in respect of the section that is handling the A, B, and C files, which is patently transparent from the question?

Hon PAUL SWAIN: Speaking to the point of order, I say that specific reference in the question is to a description of a unit established on 3 May 2005. That was, as I said, the immigration profiling group, which does not categorise by A, B, and C. I have two answers here and I am asking the member to clarify which one he wants, because it is not clear from his question. I cannot help it if he does not ask the question correctly.

Madam SPEAKER: I thank both members. I think this might be resolved if the Rt Hon Winston Peters could re-ask the question.

Rt Hon Winston Peters: The group handling the A, B, and C files—is that clear enough?

Hon PAUL SWAIN: The group handling the A, B, and C files, which was not described by me on 3 May 2005, has looked at approximately 749 files. Of those, 23 A files, 76 B files, and 1 C file require further consideration.

Dianne Yates: What is the role of the immigration profiling group? [Interruption]

Madam SPEAKER: I am sorry. The supplementary question the member asked was not really a supplementary question; it was a clarification. I take the point then—

Hon PAUL SWAIN: I raise a point of order, Madam Speaker. The supplementary question relates to the group that I specifically—

Madam SPEAKER: I am sorry, there is a misunderstanding here. I called Dianne Yates when I should have called the Rt Hon Winston Peters.

Rt Hon Winston Peters: Why were 18, or all, of the people who were engaged in those investigations on the A, B, and C files—which found that 23, 76, and 1 of those files are no longer being investigated and are still gathering dust—hired as part of a special team and employed by the Immigration Service, and then disbanded at the end of the financial year; how did that happen and why did it happen?

Hon PAUL SWAIN: Firstly, those files are not just gathering dust. As I said, if the member had listened carefully, they are under further investigation. The reason why that operation occurred in June was that additional funding was left over from the Immigration Service. They decided to clear the backlog and had the funding for that 1 month. They significantly cleared the backlog, so now, I think, only about 10 percent of the cases are outstanding. That is a significant effort, brought about by good operational policy by the Immigration Service.

Madam SPEAKER: Supplementary question, Dianne Yates.

Dianne Yates: I think my question has been answered.

Rt Hon Winston Peters: Can the Minister tell me, when we have brought in tens and tens of thousands of immigrants—and under his administration as many as 58,000 in 1 year—that the total number the group has been required to investigate since September 11 is 749; and now that we have become witness to the fact that the 18 special investigators, all of whom were high-placed police officers or former police officers, are now no longer doing their job, who on earth is doing the job to secure this country, particularly after the events in London?

Hon PAUL SWAIN: The member is clearly confused. The people—

Rt Hon Winston Peters: Ha, ha!

Hon PAUL SWAIN: The member is, because he is asking two things. He does not know what he is talking about.

Rt Hon Winston Peters: I raise a point of order, Madam Speaker. With the greatest respect, if anybody has been confused about immigration, it is he and his previous Minister—and, in fact, his whole Government. So perhaps he could get up and answer the question and not try to be clever, which is very unbecoming for him.

Madam SPEAKER: Thank you. I ask the Minister to address the question.

Hon PAUL SWAIN: Let me try to deal with it slowly. The immigration profiling group is the group that has been established to look specifically at issues surrounding post - September 11, 2001. That comprises a number of specialist immigration people. It was established a few months ago. It is doing thoroughly good work, and it is specifically looking at people from high-risk countries and people whom we would consider to be undesirable in New Zealand.

Rt Hon Winston Peters: What about this group?

Hon PAUL SWAIN: That is that group over there—a special group looking at that. The group the member is talking about was contracted to try to deal with the backlog of cases under the category of fraud. Those are things like marriage scams, and people telling porkies to the Immigration Service.

Rt Hon Winston Peters: They’re still going on.

Hon PAUL SWAIN: The two things are different. I am happy to give the member a little lesson about it afterwards.

Weathertight Homes Resolution Service—Claims Resolution

8. Hon Dr NICK SMITH (National—Nelson) to the Minister for Building Issues: Is he satisfied that the Weathertight Homes Resolution Service has given good value for the $52 million of taxpayers’ money appropriated to date, given that after nearly three years of operation only 10 percent of claims have been resolved?

Hon CHRIS CARTER (Minister for Building Issues): The Weathertight Homes Resolution Service was established to provide to homeowners dispute resolution services that are quicker and more cost effective than litigation, and it has done that. The service has provided 2,505 free assessment reports to homeowners. Two hundred and fifty-six cases have been resolved through mediation, 25 through adjudication, and 96 through other means. My department is looking at ways to further improve the service. I will outline the details of possible changes within the next week, following a meeting with affected homeowners this Friday in Auckland.

Hon Dr Nick Smith: Can the Minister explain how having a “Sound of Music” theme party on 30 June 2005 here in Wellington, including the cost of flying all staff from Auckland, their accommodation overnight, and food and drink, has assisted the thousands of leaky-home owners facing financial ruin?

Hon CHRIS CARTER: I cannot comment on the party, and I am sad to say I did not receive an invitation. What I can say is that the Weathertight Homes Resolution Service was a reaction to a hopeless situation created by the previous National Government, of which that member was part.

Russell Fairbrother: What has the Government done to avoid a repeat of the weathertightness issue?

Hon CHRIS CARTER: The Government enacted the Building Act to ensure that buildings are now built right the first time. We have fixed the appalling mess in the building sector created by the previous National Government’s hands-off approach.

Brent Catchpole: Will the Minister tell the House, after appropriating $52 million of taxpayers’ money to date to the Weathertight Homes Resolution Service, what the average value of claims to the service is, and what the average value of settlements is; if not, why not?

Hon CHRIS CARTER: The total appropriation—Dr Smith got it wrong, again—is actually $46.3 million, and I have to say that the average settlement has been $45,000.

Hon Dr Nick Smith: Can the Minister explain how having a Pacific Island dancing and kava-drinking cultural extravaganza during work time at the Stamford Plaza Hotel in Auckland on Friday, 17 June—only a fortnight before the “Sound of Music” party—which involved a dozen staff from Wellington, for which the taxpayer met the cost of their airfares, dancing girls, and food and drink, etc., helped the work of the Weathertight Homes Resolution Service?

Hon CHRIS CARTER: I can assure you, Madam Speaker, and the rest of this House, that I am absolutely committed to trying to fix up issues around weathertightness—issues, I remind this House, that were created by the previous National Government’s hands-off approach.

Hon Richard Prebble: I raise a point of order, Madam Speaker. I must come to the defence of the Hon Nick Smith. That can be in no way regarded as an answer. The Minister just told us that he was absolutely committed to fixing the problem. Was he telling us that he went to the party? How are we supposed to know what sort of an answer that was? Was the Minister saying that he did go to the hula party, or that he did not? He was asked a quite clear question, which was about how holding parties helped weathertightness, not about whether or not he ought to be committed to the issue.

Hon CHRIS CARTER: I am happy to comment on the issues raised by the member. I have approached this matter with a certain degree of jest, because it sounds so absurd. [Interruption]

Madam SPEAKER: Quiet, please, so we can hear the Minister.

Hon CHRIS CARTER: I have been responsible for the Weathertight Homes Resolution Service for exactly 26 days. I know absolutely nothing about those two parties. I can assure the member, Madam Speaker, and the rest of this House that I will be asking some very serious questions about them very soon.

Hon Dr Nick Smith: Is the Minister aware that prior to the “Sound of Music” party in Wellington, and the Pacific Island dancing party in Auckland last month, the Weathertight Homes Resolution Service last year hosted a cowboys and Indians party for all staff, with the full cost of staff travelling down from Auckland being paid for by the taxpayer and with food and beverages being provided, and that last year it also held an aeroplane theme party on similar lines; if so, does he stand by his statement that public money entrusted to help leaky-home owners is being very well spent?

Hon CHRIS CARTER: I can assure you, Madam Speaker, and the rest of this House that if the member is correct in his description of those rather jolly parties that have been going on, the entertainment culture of the Weathertight Homes Resolution Service has just come to an end.

Hon Dr Nick Smith: Is the reason this Government is so opposed to tax relief for hard-working New Zealanders because it wants the money for airfares, accommodation, entertainment, food and alcohol, and regular “Sound of Music”, Pacific Island, aeroplane, and cowboys and Indians theme parties for public servants?

Hon CHRIS CARTER: What this Government is committed to is fixing up problems. The problem of leaking homes has profoundly affected the incomes and health of many New Zealanders. That problem was created by that party over there and we are fixing it up.

Hon Dr Nick Smith: Does the Weathertight Homes Resolution Service have a good reason for all that partying when, nearly 3 years after it was established on the Government promise of a quick and cost-effective solution for homeowners, only one in 10 claims have been resolved; and what does he expect the 3,000 claimants to think of his Government partying up while their homes rot?

Hon CHRIS CARTER: If the member is correct, and I am prepared to take him at his word about those parties, which I have heard about for the first time now, I can assure him, Madam Speaker, the rest of this House, and the public of New Zealand that, as a Government, we are committed to dealing with this issue of leaking homes. We have put in place the structures to do so and we are prepared to solve problems that that member’s Government created.

Brent Catchpole: I raise a point of order, Madam Speaker. I have just been advised that my microphone is playing up. I was wondering why the Minister had not answered my question fully, and perhaps that is why.

Rodney Hide: It’s never been used before; that’s the problem.

Madam SPEAKER: That is not a point of order, or a suitable interjection. The problem with the sound system has been noted, but the member’s question did come through, if it was a little wobbly in terms of its sound.

Gerry Brownlee: I raise a point of order, Madam Speaker. I note the answer given by the Minister earlier to Dr Nick Smith and I wonder whether he would be prepared to table the briefing given to him as incoming Minister relating to the Weathertight Homes Resolution Service.

Madam SPEAKER: That is not a point of order. I just remind members that when I am in this position, of course, I am the Speaker.

Schools—Unhealthy Food and Drink

9. SUE KEDGLEY (Green) to the Minister of Health: Does she agree that a survey which shows that 84 percent of people believe that unhealthy food and drink should not be sold in schools gives politicians “the mandate needed to regulate the environment in order to protect children from influences contributing to the obesity epidemic,”; if so, what is she doing as Minister of Health to get unhealthy food and drink out of schools?

Hon DAMIEN O'CONNOR (Acting Minister of Health): The information from the survey is interesting, but one telephone survey of 489 people does not provide a mandate for any Government to bring in heavy-handed regulations at this point. This Government is working across sectors to make healthy food choices easier. For example, the Ministry of Education, Sport and Recreation New Zealand, and the Ministry of Health are working together to improve children’s nutrition and physical activity within schools.

Sue Kedgley: Why, when the Minister’s own ministry found poor diet to be the No. 1 cause of death by risk factor—more so than alcohol, tobacco, and road accidents combined— will her Government not take a simple step to improve the health of New Zealand children by getting unhealthy food and drink out of our schools?

Hon DAMIEN O'CONNOR: We understand and accept that there are growing problems around the eating habits of children, obesity, and diabetes, but we are not prepared to make heavy-handed regulations. I cannot understand that party; on the one hand it wants to decriminalise marijuana, and on the other hand it wants to criminalise things like McDonald’s, fish and chips, and corned beef.

Lesley Soper: What other initiatives are being taken to promote healthy eating and healthy action in schools and in the wider community?

Hon DAMIEN O'CONNOR: Healthy Eating—Healthy Action was launched by the Minister of Health last year. It is an integrated plan to address nutrition, physical activity, and obesity. “HEHA”, as it is commonly known, includes a number of initiatives to improve children’s nutrition and physical activity. Many district health boards and local schools have programmes under way to encourage healthy food choices and a healthier school environment.

Sue Kedgley: Is the Minister aware of a Green Party survey of 50 schools conducted earlier this year, which found that pies, chippies, doughnuts, fizzy drinks, and sausage rolls are standard school lunch fare, and that many of the schools did not sell fruit, or even sandwiches; and why does she allow those sorts of unhealthy foods to be sold in schools in clear breach of her own Healthy Eating—Healthy Action strategy, which she was just touting?

Hon DAMIEN O'CONNOR: We are not in the position where we can tell schools what they should or should not sell in their tuck-shops. One thing I would say, though, is that if the National Party and its “Tax Cuts—Education Cuts” policy ever comes to bear, schools will be forced to sell high-return, high-sugar products in their tuck-shops.

Madam SPEAKER: Gerry Brownlee raises a point of order. He is quite right.

Gerry Brownlee: Thank you.

Madam SPEAKER: These unnecessary asides only waste the time of the House, so would the Minister please just address the question.

Hon DAMIEN O'CONNOR: We are taking a whole-of-Government approach. We are encouraging schools wherever possible to sell healthy food at their tuck-shops. My concern is that if schools are put under severe financial pressure, they will be forced to run cake stalls and sell unhealthy food to many of their own children.

Sue Kedgley: Why was the Government prepared last year to make what the Minister now calls “heavy-handed” regulatory changes that require—tell—all schools that they must give priority to physical education, but is not prepared to make simple regulatory changes to require all schools to sell only healthy food and drink; could it be that her Government is afraid to confront corporations that push junk food and drink into our cash-strapped schools on a daily basis?

Hon DAMIEN O'CONNOR: The problems of obesity and diabetes are caused by both food and exercise—too much of one and not enough of the other. We are encouraging schools to give priority to exercise, and to give priority to healthy food. That is the Healthy Eating—Healthy Action policy, and we are committed to it.

Sue Kedgley: I raise a point of order, Madam Speaker. My question related specifically to why the Government would introduce regulatory change for physical education but not introduce regulatory change for food. The question was very simple, and I would appreciate it if the Minister could address it.

Madam SPEAKER: The Minister did address the question. Is there a supplementary question?

Sue Kedgley: Is the Minister aware of research linking the consumption of high-sugar drinks to obesity and type 2 diabetes; and why is her Government prepared to spend literally thousands of dollars every year buying new dialysis machines for diabetics with kidney failure, but not prepared to tackle an underlying cause of this epidemic, which is the unhealthy food and drink that our children are consuming?

Hon DAMIEN O'CONNOR: I do not accept that food alone is the cause of the problems. We committed $40 million to the Cancer Control Strategy, which encourages action in a number of areas, including healthy food, good exercise, and improved environmental situations. I am very proud of our record in this area, and that member should applaud our efforts also.

Sue Kedgley: I seek leave to table the results of a survey by Fight the Obesity Epidemic, which found that 84 percent of New Zealanders agree that unhealthy food and drinks should not be sold in schools.

Madam SPEAKER: Leave is sought to table that document. Is there any objection? There is no objection.

Superannuation—Mâori Age of Eligibility

10. RODNEY HIDE (Leader—ACT) to the Minister of Finance: What would be the annual fiscal cost, both at present and in 20 years’ time, of paying New Zealand superannuation to Mâori at age 60 instead of 65?

Hon Dr MICHAEL CULLEN (Minister of Finance): I am advised by Treasury that it cannot cost that accurately, because it has no breakdown by ethnicity of New Zealand superannuation payments. As the Government has no intention of introducing such a policy, I do not intend to get Treasury to engage in further work on that.

Rodney Hide: Does the Minister not see the Mâori Party’s policy of having a differential age for Mâori and non-Mâori eligibility for superannuation as just a logical extension of this Government’s closing the gaps strategy, which sees race-based differences in funding right across the board; if not, why not?

Hon Dr MICHAEL CULLEN: No, not at all. The same logic would imply that men should get New Zealand superannuation at roughly 60, compared with women at age 65. It would imply that the unemployment benefit should be higher for Pâkehâ than Mâori, since there are fewer Pâkehâ proportionately on the unemployment benefit than there are Mâori.

Rodney Hide: Could the Minister explain the difference between extra funding for doctors’ visits, university places, and broadcasting—all based on race under this Government—and eligibility for superannuation based on race?

Hon Dr MICHAEL CULLEN: The ethnicity element has been removed from health funding, although there are clear differences in terms of ethnicity in relation to both morbidity and mortality. The other issue is raised because of the differential life expectancy between Mâori and Pâkehâ. The answer to that is to improve Mâori health status over the long term, not to concede defeat and lower the age of eligibility for New Zealand superannuation.

Transport Spending—Source of Funds

11. JOHN KEY (National—Helensville) to the Minister of Finance: How much of the $500 million extra transport spending announced by him on 23 June 2005 is made up of tax currently in dispute?

Hon Dr MICHAEL CULLEN (Deputy Prime Minister): My latest advice is that none of it is tax in dispute from the banks.

John Key: Of the $1.6 billion of tax in dispute from the finance sector, how much has the Crown already received, and does the Minister intend to spend all of that prior to the outcome of pending court cases?

Hon Dr MICHAEL CULLEN: As I have indicated to the member, none of the $500 million is related to tax in dispute from the banks.

John Key: I raise a point of order, Madam Speaker. The question I asked the Minister was in relation to $1.6 billion of tax in dispute from the finance sector.

Hon Dr MICHAEL CULLEN: I am happy to add that I do not have the figure in front of me; all I know is that payments have been made in relation to the $500 million.

John Key: Is it not a fact that if the Crown loses these cases, it will be forced to repay not only the $1.6 billion of principle but also cumulative interest, leaving the Crown owing about $2.1 billion?

Hon Dr MICHAEL CULLEN: Yes, of course, in an extreme scenario, that would be true. That is why it is so stupid to promise already $1.1 billion in tax cuts, when one has yet to announce what one will do with tax thresholds and tax rates—which is what that member has done.

John Key: Is it the actions of a trusted and responsible finance Minister, with over 20 years of experience in Parliament, to spend billions of dollars before he even knows that it is his money to spend?

Hon Dr MICHAEL CULLEN: Yes, because I have not done so—unlike a greenhorn, would-be finance Minister, who has promised billions of dollars of tax cuts, and cannot explain where the money will come from.

Taxation—Proposed Changes

12. DAVID PARKER (Labour—Otago) to the Minister of Finance: What reports, if any, has he received on proposed changes to the tax system?

Hon Dr MICHAEL CULLEN (Deputy Prime Minister): I have seen reports that propose that tax changes would be announced 2 to 3 days within the election date being announced, then that the date for announcing those changes would be announced within 2 to 3 days, and then that the policy would not be announced for something like another 4 weeks. All those statements came from National within the space of 2 weeks, on this occasion.

David Parker: Has the Minister received any further reports on proposed tax changes?

Hon Dr MICHAEL CULLEN: I have seen reports that the tax changes proposed would cost about $1 billion per year—indeed, “$1 billion per year max” was the phrase used. But the same group has already announced tax proposals that would cost $1.165 billion per year, before it has come to the main part of the menu. That, of course, is the National Party, yet again.

John Key: If the Minister thinks that diversification is such a good strategy, as he said last night to the Wellington Property Investors Association, why is he imposing a capital gains tax on foreign shares held by New Zealand residents, which will inevitably result in less diversification for New Zealand investors?

Hon Dr MICHAEL CULLEN: The current tax regime encourages New Zealanders to invest offshore. It differentiates between the destinations of offshore investment. It has four different methods of calculating the foreign investment fund. It is a complex mess that fails to address the fundamental issues. The issue here is how to simplify the system. As usual, the National Party proposes a highly complex tax system, including an array of tax rebates that would recreate the early 1980s tax system.

Gordon Copeland: Has the Minister seen a report that indicates that 325,000 couples with dependent children could benefit from income splitting; if so, why does he continue his opposition to that concept, notwithstanding that the current system greatly overtaxes single-income families?

Hon Dr MICHAEL CULLEN: Yes, I do continue to oppose that system, because the gains to those on higher incomes would be a multiple of those on modest incomes. For example, the single-income family that earns around $40,000 to $50,000 per year would gain very, very little, indeed. For those on $150,000 per year, the gains would be very, very substantial. Again, United Future is yet to explain where the reductions in expenditure will occur to pay for that kind of policy.

Gordon Copeland: Is the real reason for opposing income splitting the fact that it recognises for tax purposes the contribution of the partner who stays at home to raise children, thus jeopardising the Government’s bleak vision of seeing all mums in the workforce, with strangers providing dawn-till-dusk care?

Hon Dr MICHAEL CULLEN: I must say that in a broader social sense, I regard all mums as being in the workforce already. Raising children is a job; it is just that it is often an unpaid one.

Gordon Copeland: I raise a point of order, Madam Speaker—

Madam SPEAKER: The point of order is that the question needs to be addressed. Would the Minister like to have another go.

Hon Dr MICHAEL CULLEN: I thought I had rather explained that by saying that, in my view, women at home looking after children are in the workforce already. At least, in terms of my children I have regarded it as something of a job to bring them up.

Gordon Copeland: I raise a point of order, Madam Speaker—

Madam SPEAKER: The Minister did address the question.

Gordon Copeland: It was rather disingenuous, because I specifically talked about mums in the workforce, with strangers providing dawn-till-dusk care. The question was not about mums staying at home; it was about mums being in the workforce.

Hon Dr MICHAEL CULLEN: What the member is trying to get at is that there is some deep, dark socialist plot to force all women out into paid labour. I might say that there is exactly the same attitude among members opposite, who have been announcing policy that would do precisely that to women who do not have a husband to help support them.

( Uncorrected transcript—subject to correction and further editing. For corrected transcripts, please visit: )

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