QUESTIONS TO MINISTERS

Economy—Reports

1. JONATHAN YOUNG (National—New Plymouth) to the Minister of Finance: What recent reports has he received on the economy?

Hon BILL ENGLISH (Minister of Finance): Statistics New Zealand this morning released the GDP data for the quarter ended June 2012. It showed that the New Zealand economy grew 0.6 percent in the 3 months to 30 June. This took growth to 1.6 percent for the first 6 months of the year. It brought annual growth to 2.6 percent, compared with June 2011. This indicates that the economy is picking up some momentum, because it is the highest rate of annual growth since 2007. So we are making progress, and on track to moderate growth of 2 percent to 3 percent per year.

Jonathan Young: What were the main components of GDP growth in June?

Hon BILL ENGLISH: We do have to be careful not to read too much into components of growth for just 3 months, because from one quarter to another they can change significantly. Agriculture was a significant contributor, up 4.7 percent, reflecting the end of a good growing season. Construction was up, indicating that the Canterbury rebuild, maybe, is now picking up momentum. Manufacturing was up 0.8 percent. Investment in fixed assets was up to 3.1 percent, due to increases in plant machinery, equipment, and construction of infrastructure such as roads and residential buildings.

Jonathan Young: How do the latest New Zealand growth figures compare with growth in other developed countries?

Hon BILL ENGLISH: The New Zealand economy continues to perform along with the betterperforming developed countries, despite uncertainties in Europe and the US. In the first half of 2012 New Zealand grew by 1.6 percent, which was higher than the US, Japan, Canada, the UK, and the euro area. Our quarterly growth is now in line with that of Australia. The fact that we are in a somewhat better position than a number of developed economies is one reason why our exchange rate remains relatively high.

Hon David Parker: Has the Minister read the report from Bernard Doyle of JBWere that by doing nothing about our overvalued exchange rate we are “importing other countries’ problems.”?

Hon BILL ENGLISH: I have, and I disagree that the Government is doing nothing. We are focused strongly on the competitiveness of our businesses. It is difficult, if not impossible, to manage our exchange rate to a significantly lower level, so we are focusing on helping our exporters to be profitable, regardless of what the exchange rate is.

Jonathan Young: Given the Government’s focus on creating a more productive and competitive economy, how will its economic programme build on the moderate growth confirmed by the latest GDP figures?

Hon BILL ENGLISH: Well, we will continue to focus on those factors that will protect us from the worst aspects of something going wrong in the global economy—so we will continue to focus on the financial stability of our banks and on getting the Government’s finances back in order. We will also press on with the wide-ranging economic programme that is focused on the long-term competitiveness of New Zealand, because that is what will help households get their debt down, and help export businesses generate the jobs and incomes that we would all like to see.

Police—Confidence

2. GRANT ROBERTSON (Deputy Leader—Labour) to the Minister of Police: Does she have confidence in the New Zealand Police?

Hon GERRY BROWNLEE (Minister for Canterbury Earthquake Recovery) on behalf of the Minister of Police: Yes.

Grant Robertson: Does she have confidence in the police to be the best people to make an assessment in the first instance as to whether someone has complied with the law?

Hon GERRY BROWNLEE: That would be an operational matter for the police. The police are independent. The member knows that.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. I do not think you could get a simpler or a straighter question: does he have confidence in the police in a particular matter?

Mr SPEAKER: Order! I think the question should be repeated. It did seek an opinion but I am not sure the opinion being sought was totally an operational matter.

Grant Robertson: Does she have confidence in the police to be the best people to make an assessment in the first instance as to whether someone has complied with the law?

Hon GERRY BROWNLEE: Yes. Might I say that I was momentarily distracted there when I heard Grant Robertson refer to me as “she”.

Hon Member: You’ll be lucky.

Grant Robertson: Exactly. Do not push your luck, Gerry. See if you can stay calm through this one. Does she have confidence in the integrity of Detective Inspector Mark Benefield’s investigation that concluded that John Banks’ election expense return did not comply with the law, as it was wrong in content, and that the donations from Skycity and Kim Dotcom should not have been recorded as anonymous?

Hon GERRY BROWNLEE: Section 16 of the Policing Act makes it abundantly clear that the New Zealand Police is an independent organisation. It is completely inappropriate for a Minister to express a view about an operational matter of that type, but I do have confidence in the New Zealand Police.

Grant Robertson: Does she think that the Prime Minister should accept the police’s view that John Banks did not comply with the Local Electoral Act, as outlined in their investigation report, or should he rely on Mr Banks’ assurance that he did?

Hon GERRY BROWNLEE: It is beyond the portfolio brief to have an opinion about what the Prime Minister should think.

Grant Robertson: Does she think it is appropriate for the Prime Minister to make judgments on the police investigation and decisions about prosecution of John Banks without giving the police the courtesy of reading their report into the investigation?

Hon GERRY BROWNLEE: It is inappropriate for a Minister to second-guess the Prime Minister’s activities. What I would say is that he has a right to accept the police’s final conclusions. They are an independent body.

Grant Robertson: Was she or her office briefed by the police on when the public release of the file on the John Banks investigation would happen?

Hon GERRY BROWNLEE: I am unable to give a clear answer to that.

Grant Robertson: Given the answers to the supplementary questions, has the Minister now changed her position, when she used to say she always agreed with the Prime Minister?

Hon GERRY BROWNLEE: Far from it. I am sure that she does always agree with the Prime Minister. But the question asked for an opinion about whether or not the Prime Minister’s position was correct. That is not a question that is within the portfolio bounds of the Minister of Police.

Grant Robertson: If the police’s independence is so important to the Minister, will she speak to the Prime Minister about the opinions he has been giving on police reports such as that on Bradley Ambrose and now that on John Banks?

Hon GERRY BROWNLEE: No. But I would note that when people do stray into these things, as the previous Government discovered, it never goes well.

Youth Unemployment, Limited Service Volunteers—Letters to Employers

3. ALFRED NGARO (National) to the Minister for Social Development: What announcement has the Government recently made on the Limited Services Volunteer programme?

Hon PAULA BENNETT (Minister for Social Development): Today the Prime Minister and I announced an initiative that will see more graduates of the Limited Services Volunteers course get work opportunities. We are asking employers to take on motivated young people who have done the Limited Services Volunteers course and are ready to work. The Limited Services Volunteers programme is a free 6-week course held at the Hobsonville, Trentham, and Burnham military camps, for 18 to 25-year-olds who are on a benefit. Young people are referred to the Limited Services Volunteers programme by Work and Income, and the course is run by the New Zealand Defence Force. Here young people learn respect, discipline, and teamwork through a programme that focuses on getting them work ready.

Alfred Ngaro: How can employers offer a young person a job?

Hon PAULA BENNETT: Employers can take on our Limited Service Volunteers graduates and there are employment subsidies available through the Government’s Job Streams initiative, which can help. I would encourage employers to get in touch with Work and Income. They can just ring 0800 778 008 and offer those young people a job. Sixty-two percent of those who go through this course do not go back on to benefit. We think we can do better by them for that.

Alfred Ngaro: What results has the Limited Service Volunteers programme seen to date?

Hon PAULA BENNETT: I know that the House has difficulty sometimes with good news for young people, but we have had truly encouraging results. For example, I know of one manufacturing employer who recently was looking for just one staff member. He interviewed four graduates from the Limited Service Volunteers, and he ended up taking two. He then went out of his way to get the other two a job with his mates in businesses around him because he saw that they were motivated young people. The number of young people on unemployment benefit has gone down by over 10,000, by 20 percent, in the last year. We are seeing encouraging results, and we would like to see more.

Exchange Rate—Effect on Export and Import Substitution Jobs

4. Hon DAVID PARKER (Labour) to the Minister of Finance: How many export and import substitution jobs does he estimate have been destroyed in 2012 as a result of the exchange rate, which has been at 70 or above on the Trade Weighted Index for every month of this year?

Hon BILL ENGLISH (Minister of Finance): There is no officially accepted measure for what the member is asking for. What I can tell him is that total goods and services export receipts have increased 15 percent, from $52.9 billion in the year to March 2010 to $60.9 billion in the year to March 2012, and a net 57,000 more people have jobs than 2 years ago. The economy is dynamic, and jobs are constantly shifting as innovation, investment, and demand change. I would be suspicious of any measure that attempted to pick out one factor, when there are many factors in a company making a decision to export or to hire another worker.

Hon David Parker: Does he agree with the Prime Minister’s statement of January 2012: “We are concerned at the level of the exchange rate because we think that above $0.75 [U.S.]it’s very difficult for our export sector.”?

Hon BILL ENGLISH: Yes, I do agree with that. The export sector has shown itself to be very resilient and capable of increasing exports and production when it is backed by stronger policies on competitiveness. If the member is suggesting that there is some way to choose an exchange rate, then I would be keen to hear from him on that, but of course he needs to keep in mind that even if he could choose the exchange rate, reducing it would reduce the standard of living of all New Zealand households.

Hon David Parker: Does he agree with the Prime Minister’s statement of August 2012 that continued currency appreciation would make the economy at some point “splutter and stutter and probably stop”?

Hon BILL ENGLISH: It is possible that that could happen. As it has turned out in New Zealand, although we have had a high exchange rate now for a number of years, a relatively high exchange rate, our export sector has continued to expand. I think the member is getting at the issue of whether we can choose an exchange rate. It would be nice if we could, but there is no known method for picking the right exchange rate in the first place, and, secondly, there simply are not the tools to hold the exchange rate at whatever desirable level there is.

Hon David Parker: If China is running a programme of competitive devaluation of its currency, as are the US, the UK, and the EU, if Switzerland is defending a cap on its currency, which is the opposite of what the Minister just said could be achieved, if Singapore is managing within a range, if Brazil and Chile are intervening in capital flows, and if Japan is printing money too to protect its exporters, why should New Zealand exporters be slain and New Zealanders lose their jobs because his Government refuses to move on the primacy given to inflation targeting? [Interruption]

Mr SPEAKER: Order! It is a serious question.

Hon BILL ENGLISH: The member’s analysis is simply wrong. We could go through all those countries, but the countries that are actually defending a fixed rate, Singapore and Switzerland, both have very large reserves, and, in the case of Switzerland, they are building up huge imbalances in defending that rate, and one has yet to see whether the experiment is going to work. In the case of the UK and the US, they are printing money because they have zero interest rates. The fact that they are printing money is a sign of deep distress in their economies, not success. I would not like to be in that position. It would be bad for New Zealanders, bad for their incomes, and bad for their job prospects.

Rt Hon Winston Peters: Given his professed concern and that of his Prime Minister about real employment and real growth, has he asked Treasury and the Reserve Bank to calculate the damage, as the primary question asked, in terms of jobs and exports from an overvalued exchange rate; if he has not, why is he giving answers that say that nothing can be done about it or nothing can be quantified?

Hon BILL ENGLISH: Well, the calculations on damage would depend entirely on your assumption about what the alternative was. Would the alternative be, you know, the Zimbabwe exchange rate, or the Japanese exchange rate, or the Aussie dollar exchange rate? I mean, it is a meaningless calculation. I mean, members of the Opposition are—

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. The question asked him as to why he has not asked the Reserve Bank or Treasury to do these calculations. I am not interested in his ideological views; I am interested—

Mr SPEAKER: No, no. Order! I have heard the member’s point of order. He is now going on to debate it. The Minister is answering the member’s question absolutely explicitly. The member asked why he has not asked Treasury to carry out these calculations. The Minister is explaining why he has not—that he believes such calculations are meaningless because of the difficulty in establishing the base level for the dollar to commence the calculation. That is his answer as to why

he has not asked Treasury to do that. [Interruption] Order! He has answered the question. Does the member wish to ask a further supplementary question?

Rt Hon Winston Peters: Well, whilst most other Ministers of Finance in the developed world, in countries doing far better than New Zealand, are implementing policies to manage their exchange rates—policies endorsed by the IMF and leading international economists—why do he and his colleagues keep on saying again in the House today, as they have for months, that they can do nothing?

Hon BILL ENGLISH: We have not said we can do nothing. What we have said is that we can use the tool that is likely to be effective and sustainable for New Zealand, and that is to improve the competitiveness of our exporters. There is no free lunch around the exchange rate. Any attempt to move it comes with large costs and large risks. New Zealand has been down that path before. It found that it was not sustainable, and for the last 25 years it has maintained a policy of a floating exchange rate, with the capacity to intervene in extreme circumstances. We do not intend to change that policy, because we have not yet seen from the members a viable alternative way of managing an exchange rate.

Hon David Parker: Does he agree that the—[Interruption]

Mr SPEAKER: Order! I want to hear the Hon David Parker.

Hon David Parker: Does he agree that the current policy settings, which give primacy to inflation targeting over the exchange rate, are not working, and is he ready to conclude, after a fourdecade- long current account deficit, that inflation is not the pressing problem for growing jobs in the economy—it is the exchange rate?

Hon BILL ENGLISH: No, I am not going to agree with that. The challenge here would be that even if you could change the Reserve Bank of New Zealand Act to tell the Reserve Bank to target the exchange rate, no one knows how it could do that in a sustainable manner that would significantly shift the exchange rate track. Oh, it is all in the book the member is waving about; it is all in the little red book. The fact is if the member looks at those countries which say they are doing it, such as Chile, Brazil, and Japan, it is highly arguable whether they are making any headway at all, given the large risks they are taking.

Emissions Trading Scheme—Effect of Proposed Changes

5. Dr KENNEDY GRAHAM (Green) to the Minister for Climate Change Issues: Is he confident that, in drafting the latest Emissions Trading Scheme amendment bill, he has sufficiently taken into account recent scientific concerns over dangerous and man-made climate change?

Hon SIMON BRIDGES (Acting Minister for Climate Change Issues): Yes.

Dr Kennedy Graham: Why is the Minister attempting to weaken the Government’s emissions trading scheme further, when leading British and Norwegian scientists are now warning of a “global disaster” unfolding, with the final collapse of the Arctic ice cap within the next 4 years—several decades ahead of what had been expected—with “terrible implications” in terms of methane release causing accelerated global warming?

Hon SIMON BRIDGES: Well, what we are doing is, effectively, potentially a short-term response to very fragile economic conditions globally, so that—as that party says it cares about— there are jobs for people and we remain competitive in this big world that we live in.

Dr Kennedy Graham: I seek leave to table two documents pertaining to that question: an item from the Guardian of 17 September, which quotes the British scientist, and a news item from BBC News of 1 September, which quotes the Norwegian scientists.

Mr SPEAKER: Leave is sought to table those two media releases. Is there any objection? There is no objection. Documents, by leave, laid on the Table of the House.

Dr Kennedy Graham: Is New Zealand doing its fair share, given that, per capita, New Zealand’s gross emissions are more than three times those of China and we are the fifth highest of the countries that signed up to reduce gross emissions under the Kyoto Protocol?

Hon SIMON BRIDGES: We are absolutely doing our fair share. We are 0.2 percent of global emissions, so we are never going to solve this problem on our own. Actually, a concerted global effort is required, and on that front we provide huge leadership when it comes to the Global Research Alliance on Agricultural Greenhouse Gases and many other things. In fact, the Minister is overseas right now, doing great work in negotiations on climate change.

Mr SPEAKER: Dr Kennedy Graham. [Interruption] Order! I want to hear the question.

Dr Kennedy Graham: Why is the Minister, who is overseas doing great work at the moment, weakening the emissions trading scheme further when he is back home, when recordings in Alaska this month show methane levels as high as 2,500 parts per billion, and separate evidence shows methane gas now bubbling out of the seabed in the Arctic?

Hon SIMON BRIDGES: Because we are concerned about the New Zealanders the Green Party says it is concerned about. We want them to have jobs. We do not want to be uncompetitive. And, actually, on a world stage, we are doing more than our fair share. We are seen as leaders in this area.

Mr SPEAKER: Dr Kennedy Graham. [Interruption] Order! I want to hear—[Interruption] Order! I want to hear Dr Kennedy Graham.

Dr Kennedy Graham: I seek leave to table two more documents. One is pertaining to observations recorded at Barrow, Alaska.

Mr SPEAKER: Whose document is this?

Dr Kennedy Graham: It is an Arctic News blog by the scientist who recorded the observations in Alaska, University of London, the Centre for Polar Observation and Modelling.

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

Dr Kennedy Graham: I seek leave to table a document in Nature Geoscience by MacDougall, Avis, and Weaver, which depicts “Significant contribution to climate warming from the permafrost carbon feedback”.

Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is no objection. Document, by leave, laid on the Table of the House.

Dr Kennedy Graham: Will the Minister, when he is back, change his mind about further weakening the emissions trading scheme, given the comment by a senior European Union negotiator on 11 September that the world should recognise that the 2-degree threshold is not enough, yet the chance of achieving it is rapidly diminishing, plus the comment by the International Energy Agency chief economist that “Under current policy, we are heading for 6 degrees.”?

Hon SIMON BRIDGES: No. We are doing the right thing for New Zealanders at this time, and we are doing our fair share in relation to climate change.

Dr Kennedy Graham: I seek leave of the House to table two documents. The first is an AlertNet release of 11 September, citing Mr Betts in the quote that I just gave, plus footnote 7 of the World Energy Outlook report of November 2011, which quotes the International Energy Agency chief economist.

Mr SPEAKER: Leave is sought to table those two documents. Is there any objection? There is objection.

Dr Kennedy Graham: In the name of democracy! When he was drafting the amendment bill did the Minister keep in mind the warning by Nobel Prize winning economist Paul Krugman that “if the consensus of the economic experts is grim, the consensus of the climate experts is utterly terrifying.”?

Hon SIMON BRIDGES: As an international figure himself, the Minister knows that person, but the truth of the matter is that we also have to take into account a whole range of factors like the New Zealand economy and what is happening globally in making sure that the New Zealanders the Green Party says it cares about have jobs in this country.

Dr Kennedy Graham: Does the Minister feel an obligation when he is back to alert New Zealanders to the fact that annual global emissions of carbon dioxide rose 3.1 percent in 2011, the highest on record?

Hon SIMON BRIDGES: No.

Dr Kennedy Graham: How can the Minister, whether he is overseas or back in New Zealand, argue that New Zealand is doing its fair share—

Hon John Banks: I raise a point of order, Mr Speaker. There is a well-known precedent in the Standing Orders that you cannot continually refer—in fact, you cannot refer—to a member being away or to when he is back. [Interruption]

Mr SPEAKER: Order! I do not think the House needs to spend more time on this issue. I am not sure that the member asking the question specifically referred to a member’s absence. He asked the question whether or not the member was away, and he was not saying the member was actually away. That is why I have not intervened.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. The paradox here is that the first person who mentioned that the Minister may not have been here was his Acting Minister, and Mr Banks clearly missed that one as well.

Mr SPEAKER: Order! I think the House should just proceed with the question.

Dr Kennedy Graham: How can the Minister, when he is punching above New Zealand’s weight, overseas or at home, be sure that New Zealand is doing its fair share to combat climate change and fulfil its obligation to future generations when the amended emissions trading scheme will do nothing to discourage pollution or incentivise clean technology, and has this Government not turned the emissions trading scheme into an emissions trading scam?

Hon SIMON BRIDGES: I utterly reject that. What we are doing is maintaining current settings in the short term while the economy worldwide is incredibly fragile. We need to protect New Zealand jobs, but when the time is right we may well ramp things up. We are doing our fair share on climate change in comparison with, really, most other countries the member might like to mention.

Emissions Trading Scheme—Effect of Proposed Changes on Greenhouse Gas

6. MOANA MACKEY (Labour) to the Minister for Climate Change Issues: What advice has he received about the impact of the Government’s proposed changes to the Emissions Trading Scheme contained in the Climate Change Response (Emissions Trading and Other Matters) Amendment Bill on forestry, and what impact will these changes have on the Government’s ability to meet its stated target of a 50 percent reduction in New Zealand greenhouse gases emissions from 1990 levels by 2050?

Hon SIMON BRIDGES (Acting Minister for Climate Change Issues): I have had a broad range of advice in various forms, including the regulatory impact statements, and meetings with officials and foresters. In general terms the introduction of offsetting in this bill will be highly beneficial for foresters. It is also true that in the short term some of the proposed changes may reduce incentives for forestry, especially where we are proposing to mitigate costs and burden on households and business, but forestry is a long-term game so I am advised that changes in the bill are unlikely to have a significant impact in terms of a 2050 target.

Moana Mackey: Is he aware that, as a result of the current low, cut price of carbon of less than $5, not only is no new planting being planned, but deforestation is accelerating as carbon foresters exit the emissions trading scheme; if so, why is New Zealand the only country that has not restricted

or banned removal units from our emissions trading scheme to stop us becoming a dumping ground for hundreds of millions of these cheap units?

Hon SIMON BRIDGES: In fact, units and the price of units worldwide are a product of the global response and what is happening. The fact of the matter is that the member is wrong in her assertion. Even those who are critics of the Government are saying that the forestry industry is not going to fade away, that replanting will occur, and that it is long-term gain that is here to stay.

Moana Mackey: How can he claim that the price here in New Zealand is as a result of the global response, when even an increase in the European carbon price would not stabilise the price in New Zealand, and when the cheap international units, which are or will be banned in every other scheme, will have nowhere to go but New Zealand, thereby collapsing the value of our carbon price, evidenced by the fact that thanks to these restrictions Europe currently has an effective carbon price of $11 compared with $3 in New Zealand?

Hon SIMON BRIDGES: The Government recognises that the current low global carbon prices may affect incentives in this area. It is important to note that these low carbon prices—as I have already said—reflect the current level of global effort. The Government could intervene in the short term to raise carbon prices to affect these incentives, but it has made the decision that now is not the time to raise costs to businesses and households during this period of economic recovery.

Moana Mackey: Was the reason he backed down on the commitment he made in April to restrict cheap international units done to secure the vote of John Banks, who issued a press release claiming credit for the back-down, saying that he had convinced the Minister to change his mind by explaining that “such a restriction on imported units would mean that no matter how low the price of carbon fell in other countries, New Zealanders would have to pay the NZU price, currently set [by the Government] at $25.”?

Hon SIMON BRIDGES: No.

Moana Mackey: Did he then explain to Mr Banks that there is no fixed New Zealand Unit price of $25 set by the Government, and that Mr Banks appears to be confusing the price cap with the carbon price, or are we passing a bill that will kill off the very sector we are hugely reliant on to meet our emissions targets based on the confused demands of a man who can add the Climate Change Response (Emissions Trading and Other Matters) Amendment Bill to the growing pile of documents he clearly has not read?

Hon SIMON BRIDGES: No.

Kenepuru Hospital—Proposed Closure of Overnight Accident and Medical Centre

7. BARBARA STEWART (NZ First) to the Minister of Health: What reports, if any, has he received regarding the proposed closure of Kenepuru Hospital Accident and Medical Centre overnight?

Hon JO GOODHEW (Associate Minister of Health) on behalf of the Minister of Health: I have been advised by the Capital and Coast District Health Board that it is exploring the option of replacing the Kenepuru Accident and Medical Clinic overnight service, which sees around 1 patient per hour, with a more effective model, the urgent community care model, which was been trialled in Kāpiti and Horowhenua since 2009. In Porirua it is only a concept at this stage. It is being explored by a working group that includes community stakeholders, general practitioners, Wellington Free Ambulance, Porirua City Council, Pacific groups, Kenepuru Hospital Consumer Committee members, and district health board staff. Should the concept exploration result in the development of a proposal, full community consultation will be undertaken next year.

Barbara Stewart: Has he been made aware of how the proposed changes for Kenepuru Accident and Medical Clinic would improve services in the Porirua-Kāpiti area; if so, how will these services be improved?

Hon JO GOODHEW: What I have been advised is that in the Kāpiti area the urgent community care model that I spoke of has successfully met the needs of the 5,000 patients in Kāpiti for 3 years. It provides an urgent and medical response by sending specially trained—

Hon Trevor Mallard: I raise a point of order, Mr Speaker. We seem to have a problem with the cross bench.

Mr SPEAKER: Sorry?

Hon Trevor Mallard: Oh no, it is all right. He is alive.

Mr SPEAKER: Order! That is not helpful to the order of the House. The member interrupted a Minister’s answer, and that is not helpful.

Hon JO GOODHEW: The member has asked about improvements in the Kāpiti and Porirua area. I am advised that in terms of the needs of the 5,000 patients in Kāpiti over the last 3 years, the model has provided an urgent and medical response by sending specially trained advanced care paramedics in really well-equipped vehicles to the patients, providing treatment in their own homes. In terms of speculating on what the improvements would be in the Porirua area, I would have to say first of all that what it would mean is that the treatment would be free. At the moment, the patients who attend the accident and medical centre have to pay between $34 and $60, unless they are under 6. So, first of all, it would be free. Secondly, the treatment would be in their own homes, which in the Kāpiti area they have said is certainly what the patients prefer.

Barbara Stewart: How can the Minister ensure that Capital and Coast District Health Board in the Porirua-Kāpiti area is providing quality care if Kenepuru Hospital goes ahead and closes its accident and medical overnight service, replacing it with roving paramedics with far less training and experience than doctors?

Hon JO GOODHEW: These are specially trained paramedics, not just the paramedics who currently staff ambulances. They have actually had specific training over and above those of paramedics who staff ambulances. The Kāpiti model does give us some confidence that this has been working well. But, in fact, where the paramedics arrive at the person’s home and find that treatment by a doctor is required—and I am told that currently about one or two of the 10 or 12 who are seen each night would go to the emergency department in Wellington—then they will still go to the emergency department in Wellington, where they will actually have medical care. This is another option that is seen to be a better, sooner, and more convenient option for the patients of the region.

Barbara Stewart: Are the proposed changes at Kenepuru Hospital Accident and Medical Clinic the forerunner for a widespread change of health service delivery nationwide, in a bid to save money?

Hon JO GOODHEW: Absolutely not. What these are are options that have already been used in Kāpiti for a better, sooner, more convenient system. In fact, 4 years ago the Capital and Coast District Health Board was in serious difficulty. This Government has put $100 million extra over the last 4 years into that district health board, and $200 million more into deficit funding. This is not about cutting costs. This is about a much better, sooner, more convenient health care model for the patients of the region.

Teachers—Problems With Novopay Payment System

8. CHRIS HIPKINS (Labour—Rimutaka) to the Minister of Education: When was she first informed of problems with the Novopay system for the payment of teachers, and was she given a date for when problems with the system would be solved?

Hon HEKIA PARATA (Minister of Education): As the member will know, given that it was his colleague the Hon Chris Carter who approved the contract with Talent2 to develop Novapay in 2008, it is the largest and one of the most complex pay systems in Australasia. I am pleased to note that over 89,000 school staff were paid in each of the last two pay cycles, since Novapay went live. As with any new IT system there have been some teething problems. I have been kept informed

about how the system is performing since it went live. I appreciate the patience of school principals and payroll administrators as the new payroll system is rolled out.

Chris Hipkins: I raise a point of order, Mr Speaker. I appreciate that the Minister is having a go at the Labour Party in her answer, but could she actually now address the question? It is—

Mr SPEAKER: Order! I think I can assist the member. Indeed, the question did not ask for all that information; the question asked when the Minister was first informed of problems with the system, and whether she was given a date when they might be remedied. It would be helpful if that was answered.

Hon HEKIA PARATA: 20 August. There were different problems in each of the pay cycles, each of them is being sought to be dealt with, so there is no fixed date.

Chris Hipkins: Can she give the 85,000 teaching and support staff relying on the Novapay system an assurance that they will receive their correct pay in the next pay round; if not, why not?

Hon HEKIA PARATA: It is actually 89,000 permanent teachers.

Grant Robertson: That makes it better?

Hon HEKIA PARATA: Well, it attests to the complexity and size of the payroll. There have been problems in each cycle, and the Novapay team is working really hard to overcome them. I am advised that up to 250 known errors occurred each month under the previous system.

Chris Hipkins: I raise a point of order, Mr Speaker. My question was relatively specific, notwithstanding the fact that the Minister disputed the figure I quoted in it. It was whether she could give teachers an assurance they would get their correct pay in the next pay round. She has not actually addressed that question.

Mr SPEAKER: I suspect she has not because, I suspect, she cannot, but the Minister may like to correct that impression, given her answer.

Hon HEKIA PARATA: The reason I corrected the first part of the member’s question was because I know that we all want to deal with facts. There are 89,126 teachers being paid, so that was why I was correcting it. We are aiming, of course, at that—that is the intent of the payroll system. For each one of them we are working hard to make sure that that occurs, yes.

Chris Hipkins: Will any employees who have incurred late-payment penalties or defaulted on any automatic payments—for example, mortgage repayments—receive any compensation, either from the payroll provider or from the Government as their employer; if not, why not?

Hon HEKIA PARATA: My understanding is that for both of the last two pay cycles since the system went live, those who were not paid in the first run were either paid within 24 hours or arrangements were made with their schools.

Chris Hipkins: I raise a point of order, Mr Speaker. That was not actually my question. I did not ask what time frame they were paid in. In fact, only a couple of hours’ difference can result in somebody defaulting on their payments. I asked whether somebody who defaulted on their payment because they did not get their pay on time will be compensated, either by the payroll provider or by the Government as their employer. That matter has not been—

Mr SPEAKER: That is, indeed, the question the member asked, and I accept that absolutely. Maybe the Minister could answer that question, because the answer she gave was not to that question.

Hon HEKIA PARATA: It is not my expectation that that would be the case, because arrangements have been made with each school in respect of the particular errors in each of the two pay cycles.

Chris Hipkins: Is she therefore suggesting that if any teachers have in fact incurred latepayment penalties or defaulted on any automatic payments, the responsibility for remedying that in fact rests with the school, and not with the payroll provider or with the Government as the employer of the teacher or support staff member concerned?

Hon HEKIA PARATA: I will have to take advice on this and come back to the member, but my understanding is that the way that some of these errors has occurred has been as a result of the inputting of the data.

Aviation—Air Transport Policy Statement

9. JAMI-LEE ROSS (National—Botany) to the Minister of Transport: What progress is the Government making in implementing an “open skies” air transport policy?

Hon GERRY BROWNLEE (Minister of Transport): On 30 August 2012 the Government announced its new international air transport policy. Under the policy New Zealand will continue to pursue reciprocal open skies agreements except where it is not in its best interests to do so. It will recognise the benefit to the country of new or additional services by foreign airlines while ensuring that New Zealand airlines have a fair and equal opportunity to compete. In particular, the new policy directs officials to give favourable consideration to granting extra bilateral approval to any airline seeking to operate to Christchurch until 2017. This recognises that a new international air service would provide a significant boost to the Christchurch economy at a time when many businesses and tourism operators are struggling to recover from the 2010-11 earthquakes.

Jami-Lee Ross: Can the Minister tell the House what has been the response to the new open skies air transport policy?

Hon GERRY BROWNLEE: The response has been very favourable. Christchurch International Airport said: “We congratulate the Ministry and the Minister on their common sense approach in considering the many submissions from aviation and tourism industry groups, then confirming a policy which puts emphasis on connecting New Zealand to global markets.” The Chief Executive of the Tourism Industry Association, Mr Martin Snedden, made similar comments. The New Zealand Airports Association made similar comments again. Air New Zealand made no comment.

Jami-Lee Ross: Can the Minister tell the House what the benefits are of an open skies air transport policy?

Hon GERRY BROWNLEE: Liberalised air services arrangements make it easier for airlines to enter or expand in the New Zealand market. As additional airlines enter the market air fares, cargo rates, etc. are likely to fall. New airlines coming to New Zealand to enhance our connectivity with additional parts of the world provides additional opportunities for New Zealand travellers, and, in particular, for our traders to do business with those people. The Government has already negotiated a number of new or enhanced air services agreements with Turkey, South Africa, Papua New Guinea, Niue, the Netherlands, Japan, and China, and negotiations with Qatar, Brazil, Thailand, and the United Arab Emirates are under way. The agreements so far will triple the amount of travel between New Zealand and China, and that is a good thing for our traders.

Rt Hon Winston Peters: I seek leave for Jami-Lee Ross to ask that question he just asked—the third question, that is—again, because during the whole answer—

Mr SPEAKER: Order! The member knows there is no Standing Order that provides for that. It can only be grandstanding that would cause a member to do that.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. I would like to challenge you. There are very clear Standing Orders and Speakers’ rulings requirements for people to address the Chair.

Mr SPEAKER: That has got me whacked.

Schools, Canterbury—Proposed Closures and Mergers

10. Dr MEGAN WOODS (Labour—Wigram) to the Minister of Education: Is she satisfied with her handling of the education renewal plan for Christchurch, Selwyn and Waimakariri; if so, why?

Hon HEKIA PARATA (Minister of Education): In the context, yes. In the context of multiple earthquakes, 215 schools, and 69,000 learners, the challenge to the education sector has been immense. Under these circumstances it was always going to be difficult to have one approach that

meets everyone’s needs. Eighty percent of schools are not affected by the proposed closures or mergers. We cannot go back, but we can do better, and that is why we are investing $1 billion into the education sector and into raising educational achievement across the entire network.

Dr Megan Woods: Given principals’ concerns over the accuracy of the information in relation to roll numbers, the number of buildings, and the presence or otherwise of facilities such as swimming pools, which is being used to determine the future of schools, does the Minister have faith in the data that she has based her decisions on; if so, why?

Hon HEKIA PARATA: Yes, I do have faith in the data and the information that the Ministry of Education has used. It has been collected over a period of 2 years, but if schools have other additional information that they would like to contribute, I invite—and, indeed, encourage—them to do so in the meetings that have been set up.

Dr Megan Woods: I seek leave to table four documents. The first document is an email from the principal of Woolston School to me detailing that the information that she has received from the ministry has errors in the number of classrooms, no mention of the Canterbury District Health Board dental hub, and errors in the roll numbers.

Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is no objection. Document, by leave, laid on the Table of the House.

Dr Megan Woods: The second document is an email from Manning Intermediate School to me that details concerns it has with the information it has received from the ministry over the number of buildings claimed to be on its site, claims that it does have a dental clinic, which was removed in 2009, on its site, and claims that it does have a swimming pool, which was removed in 2009, on its site.

Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is no objection. Document, by leave, laid on the Table of the House.

Dr Megan Woods: The third document is an email from Branston Intermediate School to me that spells out concerns over the ministry’s claims of the building utilisation on its site.

Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is no objection. Document, by leave, laid on the Table of the House.

Dr Megan Woods: The fourth document is an email from Greenpark School to me detailing concerns it has over the ministry’s information of the building count on its site and the roll data that has been used.

Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is no objection. Document, by leave, laid on the Table of the House.

Dr Megan Woods: Why was there a 17-day delay between Cabinet’s approving the educational renew plan for greater Christchurch on 20 August and invitations being issued to the announcement meeting on 13 September, which was 25 days after Cabinet had made its decision?

Hon HEKIA PARATA: Invitations were issued on 5 September and followed up on subsequent dates. The delay was as we prepared individual school packs and cluster packs—to have them ready to go.

Dr Megan Woods: Does the Minister consider that her treatment of principals and board of trustee chairs at last Thursday’s announcement meeting afforded them the respect and courtesy they deserve; and does she consider the issuing of colour-coded name badges an appropriate way to inform a principal that their school is to be closed?

Hon HEKIA PARATA: I think that the colour coding of cards was unfortunate. In terms of being able to brief 500 people around a complexity of issues, it would always have been difficult to present it in a way that met everyone’s needs.

Health Care—Quality and Safety Markers and National Patient Safety Campaign

11. Dr JIAN YANG (National) to the Associate Minister of Health: What recent announcements has she made regarding new initiatives to improve quality and safety in the health sector?

Hon JO GOODHEW (Associate Minister of Health): Today I announced that the Health Quality and Safety Commission is developing a set of quality and safety markers for the health sector. The markers will track progress in reducing health-care acquired infections, surgical harm, medication errors, and in-patient falls. These are major causes of the serious and sentinel events. A patient safety campaign and regular public reporting against the markers will encourage sector-wide performance improvements.

Dr Jian Yang: How will the patient safety campaign work?

Hon JO GOODHEW: The campaign will reduce the number of patients affected by falls, health-care acquired infections, surgical harm, and medication errors. In fact, this campaign will save lives in our health system. This will be achieved by raising awareness and increasing the use by clinicians of internationally proven interventions to help improve patient safety in this area. It will be launched at the beginning of next year, and reporting will start from midway through next year.

Schools, Canterbury—Criteria for Proposed Closures and Mergers

12. CATHERINE DELAHUNTY (Green) to the Minister of Education: What educational achievement criteria were used to choose the schools proposed for closure or merger in Christchurch and Canterbury?

Hon HEKIA PARATA (Minister of Education): Educational achievement criteria were one of a number of factors in determining the proposals. The Ministry of Education has also considered demographic shifts and demographic projections, viability of land, and compromised infrastructure. Educational achievement information included Education Review Office reports and the cycle of return review, the level of student engagement, and National Certificate of Educational Achievement (NCEA) data.

Catherine Delahunty: How can educational achievement data be relied upon when Christchurch principals say that ministry data provided to them under her supposed renewal plan is fundamentally wrong, including NCEA results being out by up to 30 percent, stand-down rates being completely incorrect, and even the number of buildings at schools being wrong?

Hon HEKIA PARATA: I am not aware of the data being incorrect. We rely on the New Zealand Qualifications Authority and the Education Review Office to provide us with that data.

Catherine Delahunty: Will all New Zealand schools now be assessed for survival based on their educational achievement?

Hon HEKIA PARATA: We have always been focused on the educational achievement of schools. That is why Governments invest in schools, so that students achieve.

Catherine Delahunty: I raise a point of order, Mr Speaker. My question asked whether the schools would now be assessed for their survival.

Mr SPEAKER: Indeed. I hear the point the member is making. The member actually asked whether schools remaining open or closed would be based on that matter.

Hon HEKIA PARATA: In the context of Christchurch, not only are we interested in how we repair and renew the network there, we are also interested in how we make the system better. So the proposals are in that context, and whether educational achievement is part of that, the answer is most unashamedly yes.

Catherine Delahunty: I raise a point of order, Mr Speaker. I asked the very specific question of whether all New Zealand schools—

Mr SPEAKER: I will save the member’s time. The member was not asking about Christchurch schools. The member was asking about the rest of the schools in New Zealand, and whether educational achievement data that the member mentions was used in Christchurch would be used to decide whether other schools in New Zealand would remain open or closed.

Hon HEKIA PARATA: When we are considering the status of schools across the country, a range of factors are taken into account, and that includes educational achievement.

Catherine Delahunty: Will she be using the same achievement criteria to close other schools around the country, and should kids in schools that tend to have lower “achievement” because of the complications of poverty be preparing to lose their schools too?

Hon HEKIA PARATA: This Government is investing considerably in raising achievement across the country—this year, $9.6 billion. I think that is a testimony to this Government’s commitment to raising achievement wherever there are learners.

Catherine Delahunty: I raise a point of order, Mr Speaker. I understood what she was saying but it did not relate to my question.

Mr SPEAKER: Order! I invite the member to repeat her question so that everyone can hear it again.

Catherine Delahunty: Will she be using the same achievement criteria to close other schools around the country, and should kids in schools that tend to have lower “achievement” because of the complications of poverty be preparing to lose their schools too?

Hon HEKIA PARATA: No.

Catherine Delahunty: What would the Minister say to children in Christchurch who have lost family members, have lost their homes, and are now facing the loss of their school?

Hon HEKIA PARATA: What I would say is that we are committed to ensuring that there is educational provision across the network, and to that end we are investing $1 billion in 16 new schools, five new schools, and some new concepts about integrated whole-of-life provision including the provision of health and guidance support.

ENDS

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