Questions to Ministers

Housing New Zealand—Non - New Zealander Tenants

1. PITA PARAONE (NZ First) to the Minister of Housing: Does he stand by his statement to the House that “No tenant of the Housing New Zealand Corporation can be a non - New Zealander.”, and how many of the 1,508 non - New Zealand citizen applicants granted tenancy in Housing New Zealand Corporation properties during the 2005-06 financial year were refugees?

Hon CHRIS CARTER (Minister of Housing): Yes. As I stated to the House on 22 March 2007, a tenant can either be a resident of New Zealand or a citizen. The member may not know that all refugees are granted permanent residency when they arrive in New Zealand as part of our quota. One hundred and fifty refugees were housed in 2005-06, or 1.45 percent of the total number of people we housed that year. New migrants other than refugees must wait for 2 years before they are eligible for either an ordinary benefit or a Housing New Zealand Corporation property.

Pita Paraone: Does the Minister stand by his statement to the House that, with the exception of refugees, Housing New Zealand Corporation’s allocation policy “should look after the needs of New Zealanders first”; if so, why are around 1,000 migrant families who arrived here on points systems being given State houses each year, while thousands of New Zealand families sit on the waiting list?

Hon CHRIS CARTER: I remind the member again that in each of the times I have answered this question from him I have stressed that one must be either a New Zealand citizen or a New Zealand resident to be a Housing New Zealand Corporation tenant. New migrants, even though they are New Zealand residents, must wait 2 years before they are eligible for a Housing New Zealand Corporation house, unless it is an emergency.

Ron Mark: I raise a point of order, Madam Speaker. It might well be that you feel that the Minister addressed the question adequately, but New Zealand First is wanting to know from the Minister why around 1,000 migrant families who arrived here on a points system were given State houses. We have been asking this Minister questions on this line now, I think, for over a month, and we really would like a clear answer if at all possible.

Madam SPEAKER: I thank the member. The Minister did address the question. It may be that that is the question that should be asked.

Russell Fairbrother: How many people were housed by Housing New Zealand Corporation in the 2005-06 financial year?

Hon CHRIS CARTER: Housing New Zealand Corporation housed 10,326 applicants in State houses in the 2005-06 financial year, of which 1,508 were either refugees or other migrants with permanent residency. During the same period we also added a further 1,043 homes to our rental stock, helping, of course, to rebuild our State housing stock, which was decimated in the 1990s by National, which sold 13,000 of our houses.

Pita Paraone: Is it true that the Housing New Zealand Corporation does not record the citizenship status of current occupants of its properties; if so, how can the Minister say “You have to be a New Zealander or become a New Zealand citizen to get a State house.”, when the system does not even record whether foreign applicants become New Zealand citizens after they are given State houses?

Hon CHRIS CARTER: To be eligible for a Housing New Zealand Corporation house I stress again that an applicants must be either a citizen or a permanent resident. A permanent resident is not eligible until he or she has been in New Zealand for 2 years. There can be no question that people who are not residents or citizens are eligible for New Zealand State houses. If the member knows of anybody who has a State house and who is not a New Zealand resident or a New Zealand citizen he should tell me and I will deal with it.

Ron Mark: I raise a point of order, Madam Speaker. How can the Minister’s two different statements be true? I am asking the Minister, through you, how can he say, in one quote, “No tenant of Housing New Zealand Corporation can be a non - New Zealander.”, and then stand there and give the House an answer that says one can be if one is a resident?

Madam SPEAKER: That is not a point of order; the member is starting to debate the issue. The Minister has addressed the question.

Pita Paraone: I seek leave to table an answer to a written question showing that more than 1,500 foreign families were granted State housing in 2005-06.

Leave granted.

Pita Paraone: I seek leave to table a statement by the Hon Chris Carter stating that the reality is that one has to be a New Zealander or become a New Zealand citizen to get a State house.

Leave granted.

Pita Paraone: I seek leave to table a statement about the allocation system by the Minister of Housing stating: “It should look after the needs of New Zealanders first.”

Leave granted.

Hon CHRIS CARTER: I seek leave to table a copy of my full answer to the question the member is quoting—question for written answer No. 5729—which explains that one has to be lawfully in New Zealand, either by citizenship or residency, to get a State house.

Leave granted.

Finance, Minister—Confidence

2. JOHN KEY (Leader of the Opposition) to the Prime Minister: Does she still have confidence in the Minister of Finance?

Rt Hon HELEN CLARK (Prime Minister): Yes.

John Key: Why does the Minister of Finance retain her confidence when the Budget shows that 15 percent of income tax earners—that is, 456,000 people—now pay the top income tax rate of 39 percent, after he initially had assured the nation that only 5 percent of income tax payers would pay that rate; and why does he still have her confidence, given that he has had eight Budgets to fix that position?

Rt Hon HELEN CLARK: Obviously, people’s incomes have risen, so they have gone into that bracket. But I agree with Bill English, who said barely 2 months’ ago that now is not the time to be giving out extensive tax cuts.

John Key: Why does the Minister of Finance retain her confidence when, in the 2005 Budget, he stated unequivocally that personal income tax thresholds would be adjusted, yet in this year’s Budget, miraculously, those adjustments are taken away, robbing New Zealanders of their only hope of ever getting a tax cut under a Labour Government?

Rt Hon HELEN CLARK: Those crocodile tears from the member are totally unconvincing. He was the first to say that that was not enough and no one would notice it. How do people notice it if it is gone?

Darren Hughes: Has the Prime Minister received any reports of business reaction to Budget 2007?

Rt Hon HELEN CLARK: I have seen many, and very positive, reports, starting with a report from the stock exchange, which says that the Budget moves to reduce company tax rates, and the tax-related incentives for New Zealanders to go into KiwiSaver, mean more future certainty for businesses and individuals, and which specifically describes the enhanced KiwiSaver as “strongly encouraging”.

Sue Bradford: Is the Prime Minister concerned that under KiwiSaver the least well-off New Zealanders will be subsidising those who can afford to save; and does she agree that while Labour and National fight it out over middle New Zealand’s votes, the children growing up in our poorest families have yet again missed out?

Rt Hon HELEN CLARK: No, I do not agree with that contention, at all. As the member knows, Working for Families has done wonders for families with children, all over New Zealand.

John Key: Why are low-income working people, who cannot afford to save, being given the triple whammy in this Budget: they do not get a tax cut, they have been told they will not get a pay rise going forward, and, most important, they are having to cross-subsidise, with their taxes, higher-income earners?

Rt Hon HELEN CLARK: Under a Labour Government, low-income people know for sure that New Zealand superannuation is safe, the public health system is safe, support for housing is safe, and public education is safe. A Labour Government is the guarantee that low-income people are looking for.

John Key: Why does the Prime Minister have confidence in her Minister of Finance when he has been receiving reports from Treasury for years indicating that the 50 percent of people who might save under KiwiSaver are already saving; and what is she saying to working New Zealanders who are middle to low income earners, who do not get a tax decrease, who do not get a pay increase, but who do get to give more of their taxes to high-income people, who the Minister of Finance already knows can save?

Rt Hon HELEN CLARK: There was hardly a hard bit of information in that question. I ask when the National Party is going to work out whether or not it is for tax cuts, because we had Mr English on Saturday morning refusing to confirm that he supported them, Mr Key saying the next day that Mr English would do it, and, again, Mr English, as reported in today’s paper, refusing to elaborate. What is their strategy?

John Key: Well, despite the Prime Minister saying there is not a hard bit of information, maybe she needs to read her Minister of Finance’s own Budget speech—

Madam SPEAKER: No. Would the member please be seated. It is important to start questions with a question and not to preface them; to do otherwise leads to a certain amount of disorder.

John Key: Would the Prime Minister care to read her Minister of Finance’s own Budget speech, wherein he says he is taking away the only tax cut that was ever on offer—in 2005—and, for the record, is silent on any future tax cuts, and quite clearly states that there will be a reduction in wage demands going forward, at the suggestion of the Minister of Finance, because of compulsory matching? So, for the record, working New Zealanders are a lot worse off under Labour; no wonder they are voting National in their droves!

Rt Hon HELEN CLARK: I would think that, right now, the National Party is trying to wriggle out of the hole it has dug for itself on KiwiSaver, because at every point in this House that party has voted against it, and the people of New Zealand want to vote for it and for a Labour Government.

Hon Dr Michael Cullen: Can the Prime Minister confirm that the most recent votes in Parliament on tax cuts occurred on Friday afternoon—to cut the corporate rate of tax, to cut the maximum rate of tax on savings in widely held vehicles, and to institute a tax credit for people saving in the KiwiSaver scheme—and that the National Party voted against all three?

Rt Hon HELEN CLARK: I can confirm that the National Party voted against the $20 tax credit for workers. I can confirm that the National Party voted against the business tax cut. I can confirm that National members did indeed fall through the trapdoor constructed for them.

Jeanette Fitzsimons: Does the Prime Minister agree with business commentator Rod Oram, who wrote in the Sunday-Star Times that the Budget will do very little to repair the environment, even though our future wealth depends on its health—and I am sorry that Michael Cullen is so bored—if so, for how long does she think the economy and people can continue to prosper while the economy’s physical base is eroded?

Rt Hon HELEN CLARK: As the member knows, there is $650 million in this Budget for rail, which is very sustainable transport. As the member knows, there is considerable funding in this Budget for energy-efficiency measures and related measures. As the member knows, far-reaching energy and energy-efficiency and conservation strategies are being consulted on, and the Government will be making decisions on them. As the member knows, a “cap and trade” system is being formulated to bring to this House. As the member knows, far-reaching policy for sustainable land management is being looked at. In other words, a Labour-led Government is serious about the environment.

John Key: Why does she think that, when National announced its policy of removing the cap on charitable donations, Steve Maharey described it as Tory charity, the Prime Minister described it as tax cuts for the rich, and Michael Cullen went out and gave a speech in which he said he did not believe in charity, and that only the redemptive power of the State could be trusted, then all of a sudden that policy turned up in Budget 2007—why did that happen?

Rt Hon HELEN CLARK: The member is getting a reputation for never quoting anything very accurately—never. I am happy to say that Mr Dunne and Dr Cullen had already made decisions on this matter before the National Party belatedly woke up and started grandstanding.

John Key: I seek leave to table the newspaper report where Mr Dunne said that, miraculously, they made the statement on the very day I—

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

Fiscal Strategy—Alternatives

3. SHANE JONES (Labour) to the Minister of Finance: Has he received any reports on alternative fiscal strategies?

Hon Dr MICHAEL CULLEN (Minister of Finance): I have seen lots of them, nearly all emanating from the National Party. In particular, I have seen a report suggesting that the Government should have run lower surpluses over the last few years—that is, adopt a more expansionary fiscal approach. This report came from Bill English, who for months has been saying we should be running a tighter fiscal stance.

Shane Jones: Has he seen reports on the impact such alternative fiscal strategies would have on monetary policy?

Hon Dr MICHAEL CULLEN: Yes. Adopting a more expansionary fiscal approach would have increased inflationary pressures and led to high interest rates and a high exchange rate. I have also seen a report stating that the Reserve Bank should have moved sooner and more dramatically on interest rates. These reports all come from Bill English. I do not support his high interest rate, high exchange rate, spendthrift approach.

Hon Bill English: Can the Minister name the current Minister of Finance who is running a high exchange rate, high interest rate, high spending policy?

Hon Dr MICHAEL CULLEN: I can name the current Minister of Finance who has been running a policy of substantial surpluses, leading against inflationary demand. I also note that the same Minister of Finance, Dr Cullen, presented a Budget last Thursday that the financial markets concluded did not place further pressure upon the Reserve Bank. I can name an Opposition finance spokesperson who had two positions on fiscal policy last week, and, when asked what his position was on tax cuts, said: “Well, look, that’s a hypothetical question.”

R Doug Woolerton: Would the Minister be prepared to at least review other nations’ monetary fiscal policies, with a view to amending the Reserve Bank of New Zealand Act to potentially better the economic outlook for exporters and businesses in New Zealand?

Hon Dr MICHAEL CULLEN: My understanding is that the select committee is finalising terms of reference for an inquiry. No doubt that will be looked at. I note that if we look across at Australia, we see that it does have multiple objectives within its relevant legislation, but in practice the Reserve Bank of Australia does actually target inflation as its primary target.

Dr Pita Sharples: Kia ora, Madam Speaker. What work is the Minister aware of in progressing the genuine progress index as a comprehensive measure of the economic accomplishment of our nation?

Hon Dr MICHAEL CULLEN: I am aware of significant work in that regard; in particular, my colleague Maryan Street has shown a very strong interest in this area and has brought proposals forward for discussion. I am aware that under such measures, for example, those countries that are often praised by members opposite as being highly successful have shown very, very modest—in fact, negative—increases in genuine progress over the last 30 years.

Judy Turner: Are the expected benefits from United Future’s business tax cuts (a) better wages for workers, (b) improved international competitiveness with Australia, (c) a more innovative and dynamic economy, or (d) all of the above; and can the Minister confirm that United Future pushed for this package?

Hon Dr MICHAEL CULLEN: I think that all of those benefits can be expected. The package is an outcome of the confidence and supply agreement with United Future, which was also mirrored in the confidence and supply agreement with New Zealand First. It was supported in the House by Labour, Progressive, United Future, and New Zealand First. It was opposed by the National and ACT parties.

Taxation—Personal Tax Rate Projections for 2008

4. Hon BILL ENGLISH (Deputy Leader—National) to the Minister of Finance: What percentage of people with taxable incomes of $1 or more are expected to be paying the top personal income tax rate of 39 percent in the 2008 financial year?

Hon Dr MICHAEL CULLEN (Minister of Finance): I should say that Inland Revenue Department data does not separate $1 from zero in terms of its own data, so the best answer I can give is that 12.9 percent of taxpayers are expected to pay the top income tax rate in the 2008 income year.

Hon Bill English: Does the Minister believe that he has kept faith with all those New Zealanders whom he told back in the year 2000 that 95 percent of New Zealanders would not face any increase in taxes as a result of his policy?

Hon Dr MICHAEL CULLEN: That statement was true at the time it was made. Of course, we also promised people that, unlike under a National Government, they could expect reasonable wage increases, as well.

Charles Chauvel: Has the Minister seen any reports that show how much savers are better off under KiwiSaver tax credits and other enhancements, compared with other tax proposals?

Hon Dr MICHAEL CULLEN: I have seen a report that shows that at every income level, savers receive more in their KiwiSaver accounts from tax credits and employer contributions than from the National Party’s 2005 proposed tax cuts, which Mr English believes were unaffordable at the time and are unaffordable now.

Judy Turner: Is the Minister aware of any immediate impacts of the new charities regime, which was secured by United Future?

Hon Dr MICHAEL CULLEN: Indeed. Jan Cameron, who announced that she had gone to Australia because of the previous charities tax regime, promptly announced that she was coming back to New Zealand. So we look forward to her charitable giving going into New Zealand charities rather than Australian ones in the future.

Hon Bill English: Can the Minister confirm estimates by Treasury and others that up to $1 billion of current tax revenue comes from people moving into higher tax brackets because of the effect of inflation on their incomes?

Hon Dr MICHAEL CULLEN: It depends on how long the period of time is that the member refers to, in that particular regard. I note that in the much-vaunted Australian comparison 20 percent of Australian taxpayers pay their two top tax rates of 40 and 45 percent.

Charles Chauvel: What reports has the Minister seen comparing enhanced KiwiSaver with the proposed indexation of income tax thresholds?

Hon Dr MICHAEL CULLEN: I have seen a report that shows that middle and high income earners will be between $10 and $14 better off by contributing to KiwiSaver as opposed to indexation.

Hon Bill English: Why did the Minister withdraw the tax cuts he had promised for two Budgets, which would have adjusted thresholds for the affected people’s rising incomes, and why did he think that the people who might benefit from that were the ones who should pay for the company tax cut?

Hon Dr MICHAEL CULLEN: I thank the member for his confirmation that National opposes the corporate tax rate cut, and would put it ahead of any personal tax rate changes. It is, of course, the corporate tax rate cut that is more likely to lead to increased economic growth, increased productivity, and increased real wages in the future. The reality is that indexation changes would have delivered very, very little to anybody earning under $38,000 a year. The sum that comes to mind, I think, is 67c a week. That is itself, of course, one-thirtieth of the amount that such people can gain from contributing to KiwiSaver.

R Doug Woolerton: Is the Minister aware of any reports suggesting that most New Zealanders would rather pay higher taxes, provided they have good essential services; if so, what are those services?

Hon Dr MICHAEL CULLEN: There have been many such reports over many long years. Indeed, we need to cast our minds back only some 7½ to 8 years to realise the alternative. In 1999 tax rates were proposed to be cut, and New Zealand superannuation was cut to pay for those tax rates.

Hon Bill English: Can the Minister confirm that he has argued that any tax cut would lead to teachers and doctors being sacked, and how many teachers and doctors will be sacked to pay for the company tax cut he has just announced of over $1 billion?

Hon Dr MICHAEL CULLEN: It would indeed be true that there could have been a personal tax cut instead of the corporate tax cut. It is hard to understand why a right-wing party would choose that particular option when a corporate tax rate cut is more likely to deliver increased economic growth. But if the member cares to come to the next business meeting I have—I had one last night and one this morning—I am sure he can explain his strange views to business people at that point.

Hon Bill English: Why did the Minister not answer the question I asked about how many teachers and doctors would be sacked to pay for his tax cut, or is it the case that a Labour tax cut is one that can be done out of surpluses, while a National tax cut is one that has to be financed out of expenditure—what kind of ridiculous economics is that?

Hon Dr MICHAEL CULLEN: If the member cares to do his numbers, he will find that the corporate tax rate cut has an effect of just over $1 billion a year. That sum includes the money for export subsidies and the money for skills training. The member seems to have forgotten that his party was proposing personal tax rate cuts alone of $4 billion a year.

Hon Bill English: Can the Minister confirm that he has consistently argued that any tax cut will lead to the sacking of nurses and doctors, and will he tell us which nurses and doctors Labour will be sacking, or will he stop running that stupid argument?

Hon Dr MICHAEL CULLEN: I can confirm to the member that I have consistently argued; it is a virtue I recommend to him.

KiwiSaver—Membership by 2011

5. HEATHER ROY (Deputy Leader—ACT) to the Minister of Finance: How many Kiwis are expected to join the KiwiSaver scheme by 2011 and what proportion of the working-age population will this be?

Hon Dr MICHAEL CULLEN (Minister of Finance): The Budget numbers are based on the assumption that some 830,000 workers—about 41 percent of the workforce—will have joined KiwiSaver by 2011-12.

Heather Roy: Why not roll the State-run Cullen fund into KiwiSaver, which by 2011 would give every working-age Kiwi, including those not employed and those at home raising children, at least $8,000 as an endowment fund, which would guarantee an uptake of every New Zealander, and which would provide all Kiwis with a real stake in the country?

Hon Dr MICHAEL CULLEN: For a very simple reason: the New Zealand Superannuation Fund is there to guarantee the long-term viability of New Zealand superannuation. For many people that is the ultimate guarantee of a reasonable standard of living in retirement. I do not think this country wants to return to the days of right-wing Governments threatening, yet again, the future of New Zealand superannuation.

Darren Hughes: What reports has he seen on support for KiwiSaver, particularly on how it will benefit low-income earners?

Hon Dr MICHAEL CULLEN: I have seen very considerable support from the business sector, but particularly there is considerable realisation, as time moves on, that in fact those on modest incomes get substantially greater proportional benefits than those on high incomes. For people on $26,000 a year, for every dollar they save $3 goes into their KiwiSaver account.

Rodney Hide: Would he consider it a breach of the commitment made in schedule 4 of the New Zealand Superannuation and Retirement Income Act 2001 if National, or another party, decided to roll the State-run Cullen fund into the KiwiSaver scheme in order to benefit all Kiwis, including those not in work and on low incomes, and what would be the implication of such a breach?

Hon Dr MICHAEL CULLEN: Schedule 4 is not enforceable. If a future right-wing Government decides to get back, yet again, on the track of cutting future New Zealand superannuation by removing its funding, then in fact the verdict will lie with the people at the subsequent general election, and they will have to start all over, yet again, in building a secure future for future retirees. What people have to remember about KiwiSaver is that it will also significantly reduce the call on the State for income-tested supplementary assistance over and above New Zealand superannuation, because people will be self-reliant. In the future there may be significant calls on that, particularly if we are not able to lift home ownership.

Health Services—Value for Money

6. Hon TONY RYALL (National—Bay of Plenty) to the Minister of Health: Are there any areas in the health system where he is not getting value for money; if so, where?

Hon PETE HODGSON (Minister of Health): Yes, there are. Although the New Zealand health system is one of the most cost-effective in the Western world, seeking better value for money is a continuous process across the sector.

Hon Tony Ryall: Why has the number of first specialist assessments and follow-up assessments provided by the public health system fallen by 28,000 in the past 6 years despite an extra $4 billion a year of health spending?

Hon PETE HODGSON: I would hope that that was the case. I suspect, actually, that it is not, but I hope that one day we can look forward to reduced hospital admissions and reduced first specialist assessments, because this Government is putting so much time, effort, and money into building a primary health care system. We are pretty proud of that, and I think it is the way of the future.

Lesley Soper: Can the Minister justify his assertion that New Zealand has one of the most cost-effective systems in the Western World, and how does he measure cost-effectiveness?

Hon PETE HODGSON: The usual way to measure cost-effectiveness, or value for money, internationally is to compare life expectancy with the annual cost on health per person. For example, the United Kingdom spends more than New Zealand per person, but we in New Zealand live longer. The United States spends about three times per person on health each year than New Zealand does, yet we live longer than people in the United States.

Barbara Stewart: Does the Minister consider that taxpayers are getting value for money for elective surgery when, in 2005-06, public hospitals performed 105,784 elective procedures against Southern Cross’s 126,300; and does the Government have any philosophical objections to making more use of private providers?

Hon PETE HODGSON: This is not a reflection on the member at all, but her public sector figure happens not to include surgery undertaken in an outpatient setting. But, none the less, the member is right to point out that the private sector provides a lot of surgery, both privately and publicly funded. When I increased funding for surgical services recently I made it clear again that district health boards could certainly contract the private sector to undertake that surgery if they wished.

Tariana Turia: Tēnā koe, Madam Speaker. Tēnā tātou katoa. Is the Minister aware that the dental health care of adults in rural Otago is an issue of particular concern, and what response would he give to a woman who sent an email to my office yesterday, advising me that adults, particularly Māori and those from lower or middle socio-economic groups, are not accessing dental care because: “The high cost of dental treatment and the increasing costs of travel are barriers for the marginalised groups.”?

Hon PETE HODGSON: The member is right to raise this matter. It is a matter of fact that adult dental care is not part of the public health system. It is just not part of it, and it never has been. This Government is preoccupied in the first instance with improving child and adolescent dental health. The member will be aware of that; she will be aware also that in the 1990s, we stopped training dental therapists—almost unbelievably, the previous National Government stopped training dental therapists. My predecessor, Annette King, opened two schools. We now have dental therapists again. We have money flowing into dental clinics. They have been put into community settings, not just in schools, so that in the future we can improve care for adolescents and maybe, as the costs allow, we can start looking afresh one day at whether this country can begin for the first time to look at providing adult dental care.

Hon Tony Ryall: How can it be that after 6 years and $4 billion a year extra on health, 28,000 fewer people got an appointment with a hospital specialist last year, compared with 6 years ago, which was the first full calendar year that data was available?

Hon PETE HODGSON: The member continues to mine the hoards of data that are sent to him each week until he finds a figure that suits him. I just remind the member that since 1999 immunisation rates are up, infant mortality is down, 28 new or refurbished hospitals have been announced, breast screening is up, cervical screening is up, mental health services have improved very significantly, there are about 4,000 extra nurses in our system, there are over 1,000 extra doctors, doctors’ fees have come down, prescriptions that used to cost $15 now cost $3, and, interestingly, every year the life expectancy of a woman in New Zealand increases by almost 3 months and the life expectancy of a man in New Zealand increases by almost 4 months. That is the sort of response one gets when one invests in a health system, as we do.

Hon Tony Ryall: Does it surprise the Minister that 14 of the country’s 21 district health boards provided their populations with fewer specialist appointments last year than 6 years ago, and is it acceptable for district health boards like Capital and Coast District Health Board and Whanganui District Health Board to provide 20 percent fewer specialist appointments than they did 6 years ago, despite the hundreds of millions of dollars he shovelled at the health system?

Hon PETE HODGSON: I will just say again that the member is well known for going through data until he can find two data points that give him an attack position. He has been doing that for the last year and a half. I would say to the member that if the health system is getting poorer, why is it that we have a thousand more doctors in our health system, why is it that we have a primary health care strategy that is now starting to get on top of issues before they need to go to a specialist, and why is it that New Zealanders are living longer if we are in so much difficulty? The member must look at the system as a whole. I invite him to try, for the first time, to do so.

Hon Tony Ryall: Why is it that we have those thousand extra doctors in the hospital system but fewer people are getting appointments to see them, and does the Minister realise that to qualify for elective surgery, people need to get a specialist appointment; is it not the case that the Government is making it harder for sick people to get a specialist appointment, as one of the Minister’s sneaky ways of controlling the surgical waiting lists?

Hon PETE HODGSON: We have now moved into the realms of fantasy. The fact of the matter is that the amount of elective surgery in this country is going up, and that does not even include out-patients—it is going up. What is more, it will continue to go up. The member continues to rock up with figures that he chooses very carefully to show his point of view, and fails to look at the overall trend. He should start becoming a little more honest in the way that he phrases his questions.

Dr Jonathan Coleman: Would the Minister explain why in the 2006 calendar year there were 6,000 fewer first specialist assessments performed across the Auckland regional district health boards than in 2001, and should the public be concerned that that number represents a decrease of 8 percent over 5 years when the population of the region actually increased by 12 percent over the same period?

Hon PETE HODGSON: I just gently say again that my hope is that we reach a health system—and we have not yet, frankly—that is so good at the primary level that we can reduce the amount of first specialist assessments. That would be a good aim. The question is whether someone is not seeing a specialist when he or she should, and the member has not asked that question. As far as I am aware, generally speaking there is no particular difficulty across New Zealand, across all specialties, in people getting to see a specialist. Certainly, if anyone has an acute need to see a specialist, this health system is particularly good at delivering it.

Hon Tony Ryall: I seek leave to table a table showing that there were 28,000 fewer specialist assessments in the last 6 years.

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

Hon Tony Ryall: I seek leave to table a table showing that fewer people received elective surgery last year than 6 years earlier.

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

Auckland Passenger Transport—Improvements

7. Hon MARK GOSCHE (Labour—Maungakiekie) to the Minister of Transport: What significant advances are being made to Auckland’s passenger transport network?

Hon ANNETTE KING (Minister of Transport): Aucklanders will see new electric trains that provide faster, cleaner, and quieter trips, with less crowding, by 2013 at the latest, thanks to a joint central government - Auckland initiative to fund $1 billion of Auckland rail electrification. At peak times trains will run at 10-minute frequencies. There will be better links to other public transport, and safe, modern facilities at train stations. There will be integrated ticketing, and additional bus and ferry services to meet the demand of the wider Auckland region, including the north. Also, the northern busway will open next year.

Hon Mark Gosche: What reports has she seen on proposals for a regional fuel tax in Auckland to help fund a range of land transport projects?

Hon ANNETTE KING: I have seen some hugely positive press releases, and let me share some of them with members. The Mayor of North Shore wanted to thank the Government formally for what he called a watershed day, and the Mayor of Papakura has said that the provision is extremely positive for Auckland in the long term. We have had the Mayor of Rodney District saying he is absolutely delighted. We have also had the Mayor of Auckland saying it was a momentous day for Auckland. We have even had the chamber of commerce say the regional petrol tax of up to 10c a litre will kick-start electrification of the rail network, progress the western ring route, and allow long-debated projects like Penlink to get moving.

Hon Maurice Williamson: Can the Minister tell us why her first reaction is always to reach for the “increase tax” lever, even when this Budget shows a $1.7 billion cash surplus, and can she please explain what sort of fuzzy logic she used to come to the conclusion that long-suffering motorists in Auckland—many of whom will never have a railway line even within cooee of their suburbs—who sit locked and blocked in traffic jams, and truckies, taxi drivers, ferry operators, bus operators, and even boaties, will be asked to pay this tax to electrify some mythical railway line in some part of town that they will never see or use?

Hon ANNETTE KING: Can I thank the member for the question. He has explained just exactly why we want to remove off the road the cars, the trucks, the boats, and everything else. The way to do that is to get people on to public transport. When it comes to the member’s question about why we always reach for the tax lever, Mr Williamson has announced that, under National, the people of Auckland could look forward to having all their roads tolled. Is that a tax or not?

Jeanette Fitzsimons: How much of the $600 million over 6 years identified in the Budget for Auckland and Wellington urban rail will be spent in Auckland, and how much of that will be interest and how much will be principal?

Hon ANNETTE KING: It is all principal. Around $500 million will be spent in Auckland and around $100 million in Wellington.

Keith Locke: When the Minister said in her press release last Thursday that the Government will raise infrastructure bonds to pay its share of Auckland’s rail electrification, in round dollar terms how much capital repayment was she envisaging as part of that contribution?

Hon ANNETTE KING: I am unable to provide the member with the answer at this point.

Transport Strategy—Vision Statement

8. Hon MAURICE WILLIAMSON (National—Pakuranga) to the Minister of Transport: Does she stand by the vision set out in the New Zealand Transport Strategy that “By 2010 New Zealand will have an affordable, integrated, safe, responsive, and sustainable transport system.”; if not, why not?

Hon ANNETTE KING (Minister of Transport): Yes, the vision is one this Government believes in, and that is why it has invested so heavily in the New Zealand transport system. For example, we have seen increases in investment from around $1 billion in 1999-2000 to an estimated $2.9 billion in 2007-08. Considerable progress has been made on all the objectives in the New Zealand Transport Strategy and more will be made in our next term of Government.

Hon Maurice Williamson: Can I ask the Minister how she believes that the goals of the New Zealand Transport Strategy could ever be met while her own ministerial advisory group on road costings said that the current system lacks rigour, that projects are exploding beyond their real cost, that no one seems to be being held accountable for value for money, and, in fact, it is a complete indictment on the roading system; that is the opinion of her own advisory group and not the National Party?

Hon ANNETTE KING: The ministerial advisory group report is a very good report that the Government has taken seriously. We will hear an announcement about that in the near future. However, to take one report, which took the member 1 month to even find that it had been released, and it took another month for him to find when we had released the Cabinet committee on Government expenditure and administration reports, is to ignore some of the very good things that have happened in terms of implementing such a strategy. For example, public transport boardings have increased by 16 percent between 2000 and 2005-06, more construction is taking place than has ever been seen in decades in this country, a coastal shipping strategy is being developed, railway networks are being revitalised, and we even have more than 200 walking school buses in Auckland—something we did not have when that member had absolutely no interest in Auckland at all.

Hon Maurice Williamson: How does the Minister believe that the goals of the New Zealand Transport Strategy can ever be met when her own Cabinet committee on Government expenditure and administration internal investigation found that the New Zealand Transport Strategy objectives are set at too high a level, lack specificity and do not contain measurable targets, that there is little sense of interrelationship between the strategy objectives and whether and how they will meet the needs of the industry, that the Ministry is not fulfilling its role of strategic policy advice and leadership, and that there is scope for a dramatic increase in the precision of accountability; this is a second report, on top of the first report by a ministerial advisory group—now an internal Cabinet committee on Government expenditure and administration report says the place is completely dysfunctional?

Hon ANNETTE KING: It is totally overcooked for the member to say that it is totally dysfunctional. In fact, it is absolute nonsense to say it is totally dysfunctional. Mind you, he talks in that very flowery language, but never did anything as Minister of Transport, and let me just say this: was there a transport strategy under Maurice Williamson as Minister of Transport? No, there was not. There was no plan; they were going nowhere, and Aucklanders knew it.

Hon Paul Swain: Has the Minister seen any reports on a proposal to corporatise and ultimately privatise the roads in New Zealand; if she has, how would those help with the strategy of having an affordable, integrated, safe, responsive, and sustainable transport system?

Hon ANNETTE KING: Yes, I have seen such suggestions. In fact, that is the policy of the National Party transport spokesperson—his policy was to privatise the roads of New Zealand. There would have been a backlash around this country like members have never seen before, if he had ever got the opportunity to privatise our roads. It certainly is not our policy.

Hon Maurice Williamson: How does the Minister believe that the goals of the New Zealand Transport Strategy can ever be met when her own chairman of Transit told a select committee 2 months ago: “One of the difficulties is that we are finding we are having to do a lot of things to gain consent under the RMA and the environment court that is adding a lot of cost to each project, and getting consents is now costing Transit a lot more than could have ever been expected, project by project.”?

Hon ANNETTE KING: Yes, I think it is fair to say that there are difficulties in terms of being able to spend all the money the Government has been putting in. For example, National was able to spend a total of $145 million a year in Auckland when it was in Government. Compare that with today, with $1.4 billion spent in Auckland. Transit is finding it difficult to spend; it does have to go through consultation. But put the record of this Government against the abysmal record of a National Government that never cared about transport and still does not today—otherwise, Maurice would not have the portfolio.

Hon Maurice Williamson: Can I just get the Minister to clarify: is she telling this House that in the light of a ministerial advisory group report, which is scathing about the lack of value for money—

Hon ANNETTE KING: It’s not scathing!

Hon Maurice Williamson: If the member would like, later on in the general debate I am really happy to read out what the report says. In the light of the Cabinet committee on Government expenditure and administration report, which basically says the place is dysfunctional and needs a complete redo, in the light of the chairman of Transit saying that costs are now blowing out such that every project they are trying to do is costing way beyond what could be expected, is the Minister telling us that apart from all of that, everything is OK?

Hon ANNETTE KING: No, this Government has said that we can always do better. We have spent the last 7½ years investing money into transport, ensuring that we have projects being implemented, that we have passenger transport taken seriously. We have said that we can always do better, however; therefore, the next step is a review, and I will be pleased to announce to the member very shortly the results of that review.

Hon Member: Oh, another review! That’s what we need!

Hon ANNETTE KING: Oh no, it will be more than any written review we saw out of National. It did not even review anything.

I seek leave to table a document showing that National spent $40 million every year throughout the 1990s on public transport.

Leave granted.

Exporters—New Markets

9. MARYAN STREET (Labour) to the Minister for Economic Development: What steps is the Government taking to support New Zealand exporters to expand into new markets?

Hon TREVOR MALLARD (Minister for Economic Development): Lots and lots of steps, including the extension of the very successful Beachheads programme into South-east Asia and India. Budget 2007 invests $4.4 million over 4 years to give our exporters access to strategic advice and executive networks in those new Asian markets.

Maryan Street: What reports has he seen on increasing New Zealand’s current export capacity?

Hon TREVOR MALLARD: I have received one report stating that there will be an $87.8 million boost to the Market Development Assistance scheme to enable New Zealand firms to export into new markets, including Asia. I saw an alternative report that stated that all New Zealand Trade and Enterprise business development grants would be axed. The first, excellent report was from the Labour-led Government’s 2007 Budget, which was delivered by the Hon Dr Michael Cullen, and the second report was from John Key.

Chris Tremain: Can the Minister please explain how the steps he is now taking will address the current and real problems faced by export businesses such as Design Spun Ltd in Onekawa, Napier, which has been forced to lay off 25 export workers because the Government sends important decisions on monetary policy to select committees and continues to overwhelm businesses with compliance costs?

Hon TREVOR MALLARD: Yes.

Hon Brian Donnelly: How does the appropriation of an extra $87.8 million for the export Market Development Assistance scheme over 4 years complement Export Year 2007, which was secured by New Zealand First as part of its confidence and supply agreement?

Hon TREVOR MALLARD: It extends the very good work that was agreed as part of Export Year 2007—the Market Development assistance scheme extension, which was developed by this Government but fitted very well with Export Year 2007. It extends it out into the baselines, so that under a Labour-led Government—clearly, supported on an ongoing basis by New Zealand First—it will be there for ever.

Benefits—Single Core Benefit

10. JUDITH COLLINS (National—Clevedon) to the Minister for Social Development and Employment: What progress has been made on the implementation of the single core benefit?

Hon DAVID BENSON-POPE (Minister for Social Development and Employment): Good progress is being made. As I believe the member is aware, the job search service has now been rolled out to all Work and Income service centres, as at the end of April this year. Additionally, phase one of the Working New Zealand work focus support package is currently before the House in the form of the Social Security Amendment Bill. As the member knows, these changes are not about just renaming benefit categories; they are about extending support services to clients based on what they can do, not what they cannot do, and on clients needs, not the name of any benefit they might be entitled to. The bill appeared to be supported, indeed, by the National Party at the select committee and in the select committee’s report back to Parliament, but, for reasons that are difficult to understand, National now appears to be opposing extending those support services to all Work and Income clients.

Judith Collins: I raise a point of order, Madam Speaker. The Minister has not addressed the question, which was about the single core benefit, not everything else.

Madam SPEAKER: The Minister addressed the question.

Judith Collins: Does the Minister agree with the comments of his predecessor, Steve Maharey, who said of the single core benefit: “I have been exploring the idea of a single benefit since I first took up this portfolio. It has been a theme for many years.”, and: “The changes are a world first, and would be the most significant reforms of New Zealand’s welfare system since 1938.”?

Hon DAVID BENSON-POPE: Indeed I do. The member will be only too aware of the capacity that now exists in Work and Income because of, in particular, the drop in the number of unemployed from 161,000 under that member’s party in Government to around 25,000 now, and the 35 percent reduction in the number of all working-age benefits. But I say to that member that, as the number of beneficiaries reduces, the people we are working with are New Zealanders who need the greatest amount of support and assistance. We are tackling the hard end of the social problems that are the legacy of that member’s party in Government. This Government does not apologise for investing in the most vulnerable members of society, to give them the assistance they are entitled to.

Lynne Pillay: How are the changes to the upfront work-focus service assisting Work and Income clients?

Hon DAVID BENSON-POPE: In the past 8 months at least 34,648 unemployment benefit, 16,638 sickness benefit, and 484 invalids benefit clients have participated in the new pre-assessment process, and have indicated therein that they want to return to work. and want to engage with planning and support services to help them to that end. Over the same period 59 percent of clients participated in the upfront work-focus service—which is voluntary at this point—and that shows how well-received that approach is. The Social Security Amendment Bill will, of course, make that engagement process a requirement for work-tested clients, and I look forward to National supporting those changes in the House.

Judith Collins: When will the single core benefit, the so-called most significant reform of New Zealand’s welfare State since 1938, be implemented, as promised?

Hon DAVID BENSON-POPE: I thought by now that it would be obvious to the member that phase one of those developments is already in place, and phase two will be introduced when Cabinet makes appropriate further decisions.

Judith Collins: Why is there no detail of the single core benefit in the 2007 Budget, when, apart from its having been a “theme” for many years, Steve Maharey promised Cabinet in 2005, in this Cabinet paper I have here, that it would be implemented this year?

Hon DAVID BENSON-POPE: Because, as I have just said to the member—and I am delighted to repeat it—Cabinet is yet to make decisions about phase two of that introduction.

Judith Collins: Does the Minister stand by his statement that he has received so many reports on the single core benefit that “compiling a list of all these reports would involve substantial manual collation”; if he does, why, after 20 years of “theming”, 7 years of reporting, and the passing of two definite roll-out dates—2002 and 2007—is there still no single core benefit as promised in the Cabinet paper, which was approved in 2005?

Hon DAVID BENSON-POPE: I have twice explained, for the benefit of that member, that phase one includes the Working New Zealand package, which is now implemented, and is mandated by the bill that she and her party refuse to support. Cabinet in due course will make further decisions about further phases of that policy.

Rates Rebate Scheme—Budget Allocation

11. JILL PETTIS (Labour) on behalf of MARTIN GALLAGHER (Labour—Hamilton West) to the Minister of Local Government: What funding has the Government allocated, in Budget 2007, for the Rates Rebate Scheme?

Hon MARK BURTON (Minister of Local Government): [Interruption] Yes, heaps—as the Minister of Finance said. In Budget 2007, in recognition of the growing support for the Rates Rebate Scheme, up to $70 million has been allocated. Since last year’s significant improvements, the scheme has been extremely successful. To date, more than $45 million has been paid to over 102,000 households, which represents an estimated 276,000 New Zealanders.

Jill Pettis: How does the average rates rebate granted to date in the 2006-07 year compare with the average rebate for the 1998-99 year?

Hon MARK BURTON: The average rebate in 1998-99 was $159.32—for the few who got it. We can compare that with the average rebate granted to date in the 2006-07 year, which is $448. That is an increase of more than 280 percent in the average rebate, and a 34-fold increase in the number of recipients since this Government updated the scheme.

Hon Brian Donnelly: Is the Minister aware that many eligible elderly people are not applying for the rates rebate, because they do not like the idea of having to reveal their personal incomes to local council staff, as reported to the rates inquiry panel; if he is aware of this problem, what is he doing about it?

Hon MARK BURTON: I am aware that despite the extraordinary success of the roll-out of the scheme, which is still in its first year, there are some challenges, such as the one the member outlined. I have officials doing a running review of the process, and we are looking at ways to further streamline and further improve the scheme to ensure that those who are eligible and want to make use of that eligibility can do so.

Greenhouse Gas Emissions—Deforestation Levels

12. Hon Dr NICK SMITH (National—Nelson) to the Minister responsible for Climate Change Issues: What reports, if any, has he received on the levels of deforestation this year, and what impact will these have on New Zealand’s greenhouse gas emissions?

Hon DAVID PARKER (Minister responsible for Climate Change Issues): I have received the 2006 Deforestation Intentions Survey, which has long been available on the Ministry of Agriculture and Forestry website. The deforestation that occurs this year will have only a minimal effect on New Zealand’s emissions during the first Kyoto period of 2008 to 2012.

Hon Dr Nick Smith: Can the Minister give a simple answer to a critical question on the minds of foresters, as they contemplate the coming planting season of June, July, and August—that is, will plantation forest owners get the carbon credits into the future for new plantings this year?

Hon DAVID PARKER: The Government’s proposed policy options to control deforestation and to encourage afforestation are well known, and decisions on which options will be proceeded with will be made in the next few months. What is abundantly clear is that Dr Smith’s ideas will not work. Just weeks ago Dr Smith was promoting a “cap and trade” scheme with no cap.

Hon Marian Hobbs: What recent reports has the Minister seen on developments that will impact on New Zealand’s greenhouse gas emissions?

Hon DAVID PARKER: Two stand out. The first came from John Key, trying to pour scorn on New Zealand becoming carbon neutral. His press release was headed “Carbon neutrality—where is it?” Embarrassingly for him, the answer came the very same day from National MP and Environment Canterbury councillor, Nicky Wagner. Her press release championed progress towards Helen Clark’s goal of carbon neutrality through the introduction of biofuels in Christchurch’s public transport system. So, despite John Key’s wish to the contrary, carbon neutrality continues to break out everywhere and is now being promoted by his own MPs.

Hon Dr Nick Smith: What sort of incompetent Government is it when it has been in office for 7½ years and it cannot tell foresters who are about to contemplate planting trees in June, July, and August of this year whether they will get credits for those trees? I say to the Minister that they do not want options or discussion papers but a simple answer: will they get credits or not?

Hon DAVID PARKER: This Government has already devolved carbon credits for permanent forests. Our discussion documents propose the adoption of one of two options. One is the devolution of carbon credits for new production forests; the other is a grants-based scheme of similar effect. Foresters can have comfort that New Zealand is at the forefront internationally of devolving carbon credit benefits to forestry.

Hon Dr Nick Smith: I ask the same question of the Minister so that we might get an answer. This matters, because we have lost 8 million trees since he has been the Minister. Will forest owners, when they go to plant trees in the normal season of June, July, and August, be eligible to receive the credits for those; if he does not know, then why would people bother to plant commercial forests when they can wait until next year and get the credits—and how does that help either the environment or our economy?

Hon DAVID PARKER: The Government’s proposals on this are absolutely clear. The final decisions will be made within the next few months, the Government having already devolved carbon credits for permanent forests and proposed devolution for production forestry. What National needs to come clear on is Mark II of its “cap and trade” scheme. I ask Dr Smith whether it includes the 50 percent of New Zealand’s emissions that come from land use. Does it or does it not?

Hon Dr Nick Smith: Can the Minister explain to the House what is clear—crystal clear to a forester—about a policy that there are options for the next 3 months, when this very day nursery and forestry contractors are making decisions about whether to plant commercial trees this season; why can the Minister not give a simple answer that they either will or will not receive those carbon credits, and can he not see that that is critical to their making investment decisions?

Hon DAVID PARKER: The Government’s proposals have as alternatives the full devolution of carbon credits for production forests, in addition to the devolution that has already happened for permanent forests, or a grants-based scheme that is of similar economic effect for foresters. Foresters are not in doubt as to the direction in which this Government is heading.

Hon Dr Nick Smith: Is the Minister aware that 8 million trees have been felled and not replanted since he became the Minister responsible for Climate Change Issues, and that this has added $200 million to New Zealand’s climate liabilities under the Kyoto Protocol; and why does he not announce today that every tree planted will gain carbon credits for the owner so that we might reverse those appalling records?

Hon DAVID PARKER: The Government has long been aware that 50 percent of New Zealand’s emissions come from the land-use sector. We are proposing a “cap and trade” scheme and other measures that will control emissions from the agriculture sector. National has yet to show its hand.

Darren Hughes: I raise a point of order, Madam Speaker. Recently, National members were on their high horse about the use of swear words in the Chamber. During that exchange of questions, Dr Nick Smith, a National MP, stood at his microphone and clearly blurted out a swear word. I think that if those members are so interested in consistency, then he should withdraw and apologise.

Hon Dr Nick Smith: I used the word “bull”, when the Minister said that National said—[Interruption] I said “bull”. I said it in response to the Minister saying that National promoted an emissions trading system without a cap. I would simply seek the leave of the House to table National’s A Bluegreen Vision for New Zealand document that mentions an emissions trading system and specifically uses the word “cap”.

Madam SPEAKER: We will handle the leave question first, then I will come back to the point of order. Leave is sought to table a document. Is there any objection? There is objection.

Hon Dr Michael Cullen: Maybe the member’s memory is failing him, but I suggest that if he gets the tapes and looks at the play-back on television, he will see that he got four letters of the word he mentioned right. There were another four added on the end.

Ron Mark: This is the same member who went out of his way to bring to the attention of the House my indiscretion, and I can assure that member that I have received a text message stating exactly what he said. So he might like to consider Standings Orders and tell the truth.

Hon Dr Nick Smith: I honestly do not recall which word—

Hon Members: Oh!

Hon Dr Nick Smith: I honestly do not recall whether I used the word “bull” or added additional words to it. But I will apologise to the House so that we can get on with business. I formally apologise for whichever phrase I used.

ENDS

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