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Questions and Answers - June 26


QUESTIONS TO MINISTERS

Prime Minister—Statements

1. DAVID SHEARER (Leader of the Opposition) to the Prime Minister: Does he stand by all his statements?

Rt Hon JOHN KEY (Prime Minister): Yes. I particularly stand by my statement that was what a ripper of a front page the New Zealand Herald had this morning.

David Shearer: Does he stand by his statement: “They might have to ask themselves if one day there was an equivalent of the Boston bombings in New Zealand, would they be the very same members who would stand up and say they prevented New Zealanders from being kept as safe as they otherwise could be.”?

Rt Hon JOHN KEY: Yes, and I think I can recall also the Rt Hon Winston Peters making very similar comments on television last night.

David Shearer: Has he seen evidence or intelligence that New Zealanders have been at risk of physical or terrorist attack over the last 12 months; if so, what action has he taken?

Rt Hon JOHN KEY: It is not in the public interest for me to outline—[Interruption] It is not in the public interest for me to outline all the threats that New Zealand might face or the intelligence that we gather, but I think I can say at a broad level as the Minister responsible and as Prime Minister that the agencies do collectively actively collect information to protect New Zealand. I think New Zealanders would expect that. That is why when Helen Clark was Prime Minister she did exactly what this law is proposing to do.

David Shearer: In quoting the Boston bombings, is he talking about a real or urgent threat based on evidence, or is he merely scaremongering to get his legislation across the line?

Rt Hon JOHN KEY: The legislation that is being proposed under the Government Communications Security Bureau, as the member knows, is for the bureau to be able to continue to provide agency support with better supervision to our other agencies like the Police, the SIS, and the Defence Force. It does so because from time to time it has concerns about individuals or groups who might pose a threat to New Zealand. If that member seriously wants to get up in this House and try to make himself feel better for taking the position that Grant Robertson has forced down his throat—

Mr SPEAKER: Order! [Interruption] Order! That is a sufficient answer to that question.

David Shearer: At least the polling is not going down as fast as—

Mr SPEAKER: Order! [Interruption] Order! Would the Hon Tau Henare cease from displaying that particular piece of paper. [Interruption] Order! I say to the Hon Tau Henare that if this continues, I will ask him to leave the Chamber.

David Shearer: Given his citing of the Boston bombings and the perceived possible threat to the physical well-being of New Zealanders, why did he not therefore move as soon as he could last year to bring in urgent legislation to keep New Zealanders safe?

Rt Hon JOHN KEY: As the member knows, we did act as quickly as we could to have a thorough review of the Government Communications Security Bureau, so that we could understand completely all of the issues and could propose legislation that would fully reflect what was required. We have now actually determined what is required, and, actually, the member is looking for a way to get out of his position. I would just say one thing to him, and it is this—and this is rather spooky: Mighty River Power is up 5.5 percent today, and that is the same number that Labour has lost in the polls.

David Shearer: Why is he performing such a spectacular U-turn on the Auckland city rail link when he has previously said that “the advice that we’ve had is that it doesn’t stack up.”?

Rt Hon JOHN KEY: What the Government is going to be announcing on Friday is that it will be supporting the construction of the central business district rail loop, and on a slower start date than the one proposed by the council. That will be 2020. The Government will make a contribution, and that is because as a Government we will also be announcing integrated projects that support the infrastructure of Auckland, and, again, maybe that is why we are polling 49 percent and Labour is polling 30 percent. We are thinking about what is important to New Zealand, and Labour is constantly in the gutter, with nothing decent to talk about.

David Shearer: Is he therefore confirming that he and his Government have changed their position on the Auckland city rail link, in line with Labour Party long-held policy?

Rt Hon JOHN KEY: Well, it is not for me to understand Labour’s policies, although I showed in the last campaign that I understood them better than Phil Goff did, but, putting that all to one side, no, I do not think it is on the same time frame. We are suggesting a start date of 2020. I do not think that is what Labour is proposing.

Government Financial Position—Reduction in Debt

2. PAUL GOLDSMITH (National) to the Minister of Finance: What progress is the Government making to ensure future generations of New Zealanders are not saddled with excessive debt?

Hon STEVEN JOYCE (Acting Minister of Finance): The Government is making significant progress in getting debt under control. It is important to remember the situation inherited by the National-led Government in 2008. Back then, Treasury was forecasting never-ending fiscal deficits and Government debt rising, roughly, for ever, and at the time the current account deficit was above 8.8 percent of GDP. That situation was clearly unsustainable. The Government has taken decisive action over five Budgets to get its own books back to surplus by 2014-15, to start repaying debt, and to help bring the current account deficit down from those previously high levels.

Paul Goldsmith: As part of its wider programme, what progress is the Government making in getting its own books in order?

Hon STEVEN JOYCE: Budget forecasts show net core Crown debt peaking at 28.7 percent of GDP in 2014-15 before declining. Longer-term projections show net debt dropping to 17.6 percent of GDP by 2020-21. Projections in 2009 indicated that if the Government had maintained the spending track it inherited, net debt would likely exceed 60 percent of GDP by the early 2020s. Government decisions since then mean that net Government debt will be around 40 percent of GDP lower than projected. That is a difference of more than $80 billion—

Dr David Clark: I raise a point of order, Mr Speaker. I am concerned about the member opposite, who continues to undermine your ruling by displaying the card with his IQ on it across the House there.

Mr SPEAKER: I was unaware that the member was continuing to use that, but if it is raised again, Hon Tau Henare, you will leave the Chamber.

Hon Tau Henare: I seek leave to table—

Mr SPEAKER: No.

Hon Tau Henare: —the No. 30.

Mr SPEAKER: Order! The member will please leave the Chamber for the balance of question time. Hon Tau Henare withdrew from the Chamber.

Mr SPEAKER: Have we got a supplementary question?

Rt Hon Winston Peters: Can I ask the Minister—

Mr SPEAKER: Order! I am sorry; I have a point of order from Gerry Brownlee.

Hon Gerry Brownlee: I raise a point of order, Mr Speaker. I fully accept the ruling that you have just made, but I would ask that when all sorts of signage and other such is displayed on a future occasion by the Opposition, a similar approach will be taken, because it is equally offensive at various times.

Mr SPEAKER: Order! No, there is no need for any further comment. Mr Henare was asked to not show that any further, and he continued to do so. That is defying the Speaker.

Paul Goldsmith: What reports—

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. Before that last point of order, you had indicated that it was going to be my question.

Mr SPEAKER: No. I determine when I take supplementary questions and from where I take them. I did at one stage think the member was raising a point of order. The member tends to stand to his feet and not announce to me whether it is a supplementary question he is seeking or a point of order, which does not make it helpful.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. I am happy to look at the Parliamentary record, but, with respect, that is balderdash. I get to my feet and I ask a supplementary question or I make a point of order, and that sort of criticism will not do.

Mr SPEAKER: And I have accepted a supplementary question from Paul Goldsmith. I will come to the member in due time.

Paul Goldsmith: What reports has he received on New Zealand’s wider national debt position, particularly with respect to the current account and the net international investment position?

Hon STEVEN JOYCE: Statistics New Zealand last week reported the March quarter data on both the current account and New Zealand’s net international investment position. This showed that the current account deficit narrowed slightly, to 4.8 percent of GDP as at 31 March, down from 5 percent as at 31 December. New Zealand has run current account deficits for around 40 years, but the situation became extremely serious in 2006, 2007, and 2008, when the deficit was consistently higher than 8 percent of GDP. The net international debt position also improved a little in the March quarter: it fell to 69.3 percent of GDP, down from 71.4 percent in December. Although that is still high, it compares favourably with the net international debt position of 85 percent of GDP in early 2009.

Rt Hon Winston Peters: How does the Minister reconcile that last answer and the one before that with a current account deficit of $10 billion, heading towards $17 billion—every dollar of which is debt—and the worst borrowing record in over 70 years?

Hon STEVEN JOYCE: I cannot agree with the member’s statements, and I think the first issue is that he is looking at amounts, rather than at percentages of GDP. Of course, if you have a larger GDP, then you can actually have a larger amount of debt—which may be relevant to the member in future. But in terms of the current account, the actual percentage of GDP has actually declined, which is the key point, from 8.5 percent or more of GDP in 2008 down to around 4.8 percent now. That is good progress.

Paul Goldsmith: What contributions are manufacturers making in helping New Zealand build economic growth?

Hon STEVEN JOYCE: A very good question. Manufacturers are making a significant contribution. Since the beginning of 2009 the manufacturing sector has grown by 9.2 percent. That is a very significant turn-round from 2008, when manufacturing shrank by 12 percent in just 1 year. Since 2009—

Dr David Clark: How much of that’s non-primary sector?

Hon STEVEN JOYCE: —wait and it will come, “Mr Parrot”—non-food manufacturing sales have grown by 6.3 percent. In 2008 they fell by 7.2 percent. Since 2009 non-food manufacturing volumes have grown by 1.3 percent. In 2008 they fell by nearly 15 percent, and non-food manufacturing export volumes have grown by nearly 15 percent since 2009. Finally, of course, the manufacturing BNZ-Business New Zealand Performance of Manufacturing Index is currently at 59.2, compared to 35.8 in 2008.

Hon David Parker: Given the Minister did not know the answer to that question yesterday, can he now confirm that manufacturing exports outside the primary sector are down in real terms by 17 percent since 2008 and by 6 percent in the last full year for which there are records?

Hon STEVEN JOYCE: I have checked and, no, I cannot, because the figures I have just quoted—the non-food manufacturing—is the closest information. I appreciate the member may have constructed his own series in terms of reducing it. The other thing is that Mr Parker seems to be trying to use the CPI to deflate the export figures, hence his use of what he calls real terms. Of course, that is simply wrong, as domestic CPI is not the way to deflate export prices and volumes. So, I am sorry, but Mr Parker is just being a wee bit too tricky with these numbers.

Hon David Parker: Is it correct that, according to the Reserve Bank, the level of borrowing for residential housing is at an all-time high of $181 billion; if so, how much additional debt does he expect New Zealanders will take on to buy houses over the next year, with house price inflation in Auckland currently running at 15 percent?

Hon Member: At half what it was under Labour.

Hon STEVEN JOYCE: Well, exactly. I think that record is significantly better than under the Labour Government. I think the issue—

Hon David Parker: I raise a point of order, Mr Speaker. My question was whether the figure that I gave is correct. It was not what the Minister—

Mr SPEAKER: Order! I heard the question, and if we could give the Minister an opportunity to answer, then I will decide whether it has been addressed.

Hon STEVEN JOYCE: Well, I do not have the exact numbers and, given I have just been deconstructing the member’s previous question, I am rather leery as to his numbers.

Hon David Parker: I raise a point of order, Mr Speaker. He says he does not know the answer to that question, so I am happy with that answer.

Mr SPEAKER: I heard that, but that is not a legitimate point of order. We are going to have difficulty—

Hon David Parker: I raise a point of order, Mr Speaker. If the purpose of question time is for the Minister to address the question and the Minister says: “I don’t have that information.”, it is not within his ambit to address another question that was not asked.

Mr SPEAKER: Order! I would—[Interruption] Order! No, I do not need any assistance. The difficulty I want to see cease is a situation where any member asks a question, then decides they are either unhappy with the answer or completely satisfied with the answer, and then raises a point of order that stops a Minister from finishing the answer to the Minister’s satisfaction. If that continues to happen, the best way forward for me is to then move to the next question, because I will assume on that basis that the person who has asked the question is completely satisfied with the answer. Therefore, I see the opportunity for the forfeiture of supplementary questions. I do not want to do that. There will be the odd occasion when it is legitimate for a member to say the question has gone on—[Interruption] Order! I am trying to help the House, particularly after yesterday. But we are

going to get into difficulty if whenever a member thinks he or she has heard enough, he or she raises a point of order to say: “That’s sufficient, let’s move on.”

Grant Robertson: I raise a point of order, Mr Speaker. In the previous Speaker’s term we got into the rhythm in this House that if a straight question was asked, a straight answer would come back. The issue that we on this side of the House have is that when we ask a question that is a straightforward question, the Minister says: “I don’t have that information.”, and then proceeds to go into either a political attack or some other thing. That is where the difficulty lies for us. We would like to see that ruling continue to be in force, and then we will not have the problems that you are suggesting.

Mr SPEAKER: I will—

Hon STEVEN JOYCE: Speaking to the—

Mr SPEAKER: Oh, we will hear from the Hon Steven Joyce.

Hon STEVEN JOYCE: As I recall the question in this particular instance, it asked about a piece of information and then went on to ask some other things, so the question then becomes whether the Minister is entitled to make a response to the broader elements of the question if he or she does not have that particular detail in front of him or her. I think that to suggest that is not possible is perhaps making it quite hard for Ministers to determine how exactly to respond to a question.

Mr SPEAKER: I appreciate—[Interruption] I do not need to hear any more. I appreciate the comments that have come from both sides of the House. With regard to Grant Robertson’s point, the previous Speaker did establish a very good habit of ensuring that where a clear question is asked, it deserves a concise and clear answer. If that answer is that the Minister doesn’t have the facts, I still think that on occasions there will be the opportunity, and there should be the opportunity, for the Minister to explain why he might not have those facts. So I accept the points that have been raised by all members, particularly Grant Robertson, and I will endeavour to see that we get sharp answers to sharp questions.

Hon Clayton Cosgrove: I raise a point of order, Mr Speaker.

Mr SPEAKER: If it is a fresh point of order, I will hear it for certain.

Hon Clayton Cosgrove: Yes, it is. I thank you for your ruling. The only other point I would raise—[Interruption]

Mr SPEAKER: Order! This is a point of order and it will be heard in silence.

Hon Clayton Cosgrove: —and on which I would seek your guidance, because I think you may have inadvertently made reference to the exchange between the Minister and me yesterday, and that is fair enough. But you have ruled, and I think it was quite a new ruling, and you have ruled on a number of occasions over subsequent months, that if a member gets a direct yes or no answer, or whatever, and is satisfied with that ruling—and you have stuck up for our right to do so—we can rise and say we are satisfied with that and move on. You did that with me yesterday, for instance, here.

Mr SPEAKER: That is exactly the point I am raising, so it is hardly a fresh point of order. I am saying to the member, particularly in light of my reviewing the Hansard yesterday, that if he takes the opportunity of doing that, it is not strictly a point of order, and the risk for any member who does that will be for me to immediately move to the next question.

Hon David Parker: Then is it correct that, according to the Reserve Bank, the level of borrowing for residential housing has increased by around $10 billion over the past year; if so, how much additional debt does he expect New Zealanders will take on to buy houses over the next year, with house price inflation in Auckland currently running at 15 percent?

Hon STEVEN JOYCE: Again, I can say that I do not have those specific numbers in front of me, in light of the primary question, but the point that I can—

Hon David Parker: Which was about debt—excessive debt.

Hon STEVEN JOYCE: Well, it was actually about—yes, but not about elements of it. But the point I would make is that in terms of the increase in residential debt that is coming off a period

post - global financial crisis that was significantly lower, but, nevertheless, the Government is concerned about increasing levels of residential debt, which is why we are very, very focused on making sure that we increase the supply of houses in Auckland to ensure that there are opportunities for people to purchase houses at lower levels of debt than they have been able to do in the past.

Hon David Parker: I seek leave to table the Reserve Bank data series to show that the debt figures and increases are as I have said.

Mr SPEAKER: It is available to all members, I think, is it not?

Hon David Parker: Point of order, Mr Speaker—

Mr SPEAKER: Perhaps if the member could tell us the source of the document.

Hon David Parker: It is Table C6 from the Reserve Bank of New Zealand, but—

Mr SPEAKER: Which is available, I presume, on their website. [Interruption] No. Order!

Public Service—Corruption Perception Index Ranking

3. Dr RUSSEL NORMAN (Co-Leader—Green) to the Prime Minister: Does he stand by his statement that “In 2009, New Zealand was rated first on the Transparency International’s ‘Corruption Perception Index’. Out of 180 countries, New Zealand was rated as having the lowest perceived public sector corruption. As a nation, that ranking is something of which we can be very proud”?

Rt Hon JOHN KEY (Prime Minister): Yes. I note that the 2010, 2011, and 2012 indexes all show New Zealand as maintaining its position as first or first equal in the rankings.

Dr Russel Norman: Is he concerned that Transparency International, whose Corruption Perceptions Index he rightly holds in such high regard, has highlighted his own convention-centrefor- pokies deal as raising concerns from both a fiscal transparency, accountability, and a regulatory perspective; if not, why not?

Rt Hon JOHN KEY: No, and the reason for that is that this deal will be in full view for the public. We campaigned on the issue prior to the election. The agreement will be in the public domain when it is fully signed by both parties. The legislation supporting it will go through a select committee process, and the Auditor-General had a thorough look at the process and, for the most part, was happy.

Dr Russel Norman: So is the Prime Minister saying that Transparency International is wrong?

Rt Hon JOHN KEY: Yes, and the Government has been very transparent about its dealings with Skycity. Unlike some political parties, we do not do our negotiations in a box on a Saturday night at the All Blacks game. We do it—

Mr SPEAKER: Order! The question has been answered. [Interruption] Order!

Dr Russel Norman: Does he agree—[Interruption]

Mr SPEAKER: Order! The level of interjections coming now from both sides of the House is unacceptable for Dr Norman to ask his supplementary question.

Dr Russel Norman: Does he agree with Transparency International that the public procurement process in the Skycity project was severely compromised?

Rt Hon JOHN KEY: No, and neither does the Auditor-General.

Dr Russel Norman: Does he disagree, then, with the Auditor-General, when she found that the evaluation process for the convention centre bids was neither transparent nor even-handed?

Rt Hon JOHN KEY: I do not agree with the Auditor-General on that basic point. I think it is worth remembering, if we go through the process one more time, that this is a deal that we campaigned on, this is a deal where the full agreement of all the terms and conditions will be in the public domain for everybody to see, this is a deal that will be supported by legislation that will go through a full select committee process, and this is a deal where the Auditor-General actually found, broadly speaking, she was happy. The point that the Auditor-General did not like was the point that we have traversed in this House many times before. She believed that the officials should have

stopped the process at a point where it was clear that Skycity was the likely preferred candidate, and in fact the Government’s view was we needed to get more information.

Dr Russel Norman: Is it then the Prime Minister’s position that Transparency International is wrong when it said the Skycity project procurement process was severely compromised, and is it his position that the Auditor-General is wrong when the Auditor-General found that the evaluation process was neither transparent nor even-handed, and the Prime Minister is always right, and Transparency International and the Auditor-General are just wrong?

Rt Hon JOHN KEY: I could not put it better myself. Yes, they are wrong.

Dr Russel Norman: Does he intend to ignore all of the different legal and academic voices, such as the Law Society, Transparency International, and the Auditor-General, who have all raised concerns about the way this Government treats the rule of law and the proper procurement process, and is he concerned that he will corrode the good reputation that the New Zealand Government had when he came into office?

Rt Hon JOHN KEY: The Government is always going to be active across a wide range of fronts. We are a busy Government and there will always be people who offer views, and sometimes we will not agree with them. But I point out to the member again that New Zealand ranked No. 1 in its own right or first equal in the years 2010, 2011, and 2012. They happen to be all the years I was Prime Minister of New Zealand. I am not the one who sneaks off to Skycity’s box and has a little—

Mr SPEAKER: Order! The question has been adequately addressed.

Dr Russel Norman: I raise a point of order, Mr Speaker. I wish to raise the issue that you yourself spoke of previously.

Mr SPEAKER: Order! This is a point of order, and it will be heard in silence.

Dr Russel Norman: The point that we have been referring to is Standing Order 383, “Content of replies”, which states: “The reply to any question must be concise and confined to the subjectmatter of the question asked,”. The Prime Minister repeatedly, during the course of these questions, broke that Standing Order. I would ask you what is your remedy to deal with the fact that the Prime Minister consistently breaches Standing Order 383?

Rt Hon JOHN KEY: The member asked me questions about transparency and openness in relation to Skycity. I made the Government’s position very clear. I also contrasted it with the behaviour I saw from other political parties. That is quite legitimate public answering.

Rt Hon Winston Peters: Supplementary question.

Mr SPEAKER: No, I have just got to rule on a point of order that has been raised by Dr Russel Norman. I ask Dr Russel Norman to have a close look at the content of his question in line with Standing Order 377. If he can get his questions concise, he can expect a concise answer.

Rt Hon Winston Peters: Did Skycity donate money to the National Party in 2011; if so, how much?

Rt Hon JOHN KEY: I have no responsibility for that.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. I did not ask the Prime Minister about his responsibilities. I asked him a simple question: how much did Skycity give you in 2011?

Mr SPEAKER: Order! Well, Skycity certainly did not give me anything, but the Prime Minister stood up and said he does not have any responsibility. That was his answer to the question.

Dr Russel Norman: I raise a point of order, Mr Speaker. It is a well-established tradition that if in the answers that the Prime Minister gives he introduces subject matter, then that becomes legitimate for the Opposition to ask questions about. Mr Peters has followed up on Mr Key’s own introduction of political parties’ behaviour with Skycity. Mr Peters simply asked a follow-up question on it.

Mr SPEAKER: That is absolutely correct. I did not rule the question out of order. The question was in order, and the Prime Minister answered it as he saw fit.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. You are correct. You did not rule out the question. But what you did was you disagreed with the point of order that sought to make

him answer it by saying it was not his responsibility. He made it his responsibility when he talked about the Labour Party. Now he says it is not. That is the inconsistency that you are required to address.

Mr SPEAKER: The Prime Minister stood to his feet and answered the question and said he had no responsibility for any donations that were made by any company to a political party. He is entitled to give that answer if he so chooses.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. This is not about whether the Prime Minister has or has not that responsibility, since he put that issue with his reference to Labour not once but three times. The question is whether he does or does not know the answer. He can answer that question, but he refuses to answer on the basis that it is not his responsibility. That is what questions in the House are for.

Mr SPEAKER: It is not the way that the Prime Minister chose to answer the question, and that is a matter for the Prime Minister to decide. I have ruled on the matter. We are moving forward to question No. 4 from Phil Twyford.

Public Transport, Auckland—City Rail Link

4. PHIL TWYFORD (Labour—Te Atatū) to the Minister of Transport: Has he had any reports of an imminent Government U-turn on Auckland’s City Rail Link?

Hon GERRY BROWNLEE (Minister of Transport): No.

Phil Twyford: How much does it stick in his craw to support Labour’s policy on the city rail link, so capably promoted by the popular Labour Mayor of Auckland, Len Brown?

Hon GERRY BROWNLEE: Not at all. In January of this year I met with Mr Brown and made it clear that our position would be determined by the analysis that we did on that proposal.

Phil Twyford: Doe he now agree with Aucklanders that building the city rail link is a nobrainer, and does he now disagree with himself that the city rail link is not viable until 2030; if so, how did he convince himself that he was so wrong?

Hon GERRY BROWNLEE: The member misrepresents what I have said in the past. In black and white it says there that the project becomes more viable towards 2020. But we have looked at the likely demographic of Auckland and decided that we do need to futureproof the city, and therefore we do support the rail loop being built in 2020.

Phil Twyford: When did he tell Steven Joyce that his trenchant opposition to the city rail link was being overridden, and how did Mr Joyce react to being made a complete fool by his own Government?

Hon GERRY BROWNLEE: We are seeing here a clear reason why the National Government is so popular and the Labour Opposition is so bereft of ideas. The reality is that Mr—[Interruption] No—

Hon Member: You stole our ideas.

Hon GERRY BROWNLEE: Not at all—

Mr SPEAKER: Order! I am rather keen to hear the answer.

Hon GERRY BROWNLEE: The fact is that Mr Joyce did agree with the Auckland Council that it should go ahead and protect the route, and that is occurring as we speak. When I inherited that ministry I carried on the position that had previously been taken. That was that we wished to have a closer look at the viability of the project. We have done that very responsibly and Friday’s announcement will be well received by the people of Auckland.

Phil Twyford: Does he stand by his recent statements that the city rail link is “a short little loop” that is neither useful nor popular?

Hon GERRY BROWNLEE: Well, it is a short little loop and in many circles it is not popular. The reality is that by 2020 the demographic of Auckland will have changed and it would be irresponsible for any Government not to futureproof against that. That is what we are doing.

Schools, Secondary—Student Retention

5. Dr CAM CALDER (National) to the Minister of Education: What recent reports has she received on improvements in the retention of students in secondary school?

Hon HEKIA PARATA (Minister of Education): Tēnā koe, Mr Speaker. Speaking of front pages, the front page of the Dominion Post this morning was not bad, either. I am delighted to report that I have seen information from the Ministry of Education showing that the number of young people dropping out of school before the age of 16 is at an all-time low. Early leaving exemptions for students under 16 have declined significantly under this Government from a peak of over 4,000 applications in 2005 to just over 300 last year. That is a decrease of 93 percent. Overall retention has increased under this Government for students staying on until at least their 17th birthday. Provisional data for last year shows an increase in retention rates from 79.3 percent in 2009 to 81.4 percent in 2012. We have more work to do in this area, but I congratulate those schools that are making progress in engaging students and keeping our young people on track for a brighter future.

Dr Cam Calder: What initiatives has the Government implemented to keep secondary school students in learning for longer?

Hon HEKIA PARATA: This Government’s Youth Guarantee provides for a number of great initiatives, with more than 10,000 students involved last year across the country remaining engaged in education and gaining valuable skills. Initiatives such as trades academies and service academies have proved successful for 2,340 students last year alone. I also agree with the Secondary Principals’ Association President, Tom Parsons, who said: “We’ve gotten smarter as educators, and we’re more effective in looking towards [at-risk] learners.” Schools have been able to use an increasing number of supports available to them, including the vocational pathways—

Mr SPEAKER: Order!

Hon HEKIA PARATA: In the words of Andreas Schleicher—

Mr SPEAKER: Order! Order!

Hon HEKIA PARATA: —from the OECD, whom I am looking forward to welcoming to New Zealand—

Mr SPEAKER: Order! It is now becoming a very long answer.

Hon HEKIA PARATA: Oh—

Mr SPEAKER: Order! Any further supplementaries?

Dr Cam Calder: Is the Minister aware of any specific examples of innovative approaches by schools to keep their students engaged?

Hon HEKIA PARATA: Yes, I have seen a number at a number of schools. At Papakura High School, for instance, they have developed vocational pathways in primary industries, construction and infrastructure, and creativity. They have piloted a health and sports science academy—

Hon Trevor Mallard: Oh, that’s new!

Hon HEKIA PARATA: —it is new, as a matter of fact—and are bringing together curriculum and learning. Results to date show that students have significantly increased participation, compared with their cohort previously. The Tāmaki College Trades Academy—

Hon Trevor Mallard: Who wrote that?

Hon HEKIA PARATA: Well, I think these schools and their parents are very proud of their students making progress. Certainly, this Government is. Attendance rates have increased for the students in the academy to an average of 85 percent and achievement rates have doubled, and the overall school result has 90 percent achieving in the academy. I think that is great news.

Health Care—Affordability

Hon ANNETTE KING (Labour—Rongotai): My question is to the Minister of Health—

Maggie Barry: Worst Minister of Health in 50 years.

Hon ANNETTE KING: The best Minister of Health in 50 years. That is wonderful. Thank you, Maggie Barry. I appreciate that.

Mr SPEAKER: Order! That shows you the lack of benefit—[Interruption] Order! That shows you the lack of benefit from an interjection from this side of the House. Would the member now ask her question.

6. Hon ANNETTE KING (Labour—Rongotai) to the Minister of Health: What recent reports has he received on affordability of health care for New Zealanders?

Hon TONY RYALL (Minister of Health): I have received a range of reports, including one from the OECD, the world’s leading economic research and advisory organisation, which advises that New Zealand had the world’s third-largest increase in public health spending. The facts show that we have increased Vote Health operational funding under this Government by an average of $500 million per year, and, despite tight times, we are investing more in the changing needs of our population thanks to strong financial management.

Hon Annette King: What reports did he read before he decided to increase the cost of prescriptions from $3 to $5 per item, and did his reading include the recent Treasury report entitled Health Projections and Policy Options for the 2013 Long-term Fiscal Statement, which states there can be unintended consequences from increasing co-payments?

Hon TONY RYALL: A range of reports were considered in making those decisions in respect of the increase in the pharmaceutical charge, and included in that was advice from Treasury. What we do know is that no family need pay more than an additional $40 a year and they can get a pharmacy subsidy card. Also, if they are having trouble making ends meet in respect of those prescription charges, they can talk to Work and Income.

Hon Annette King: In light of that answer, was it an intended consequence that a growing number of sick older New Zealanders are now unable to receive part or all of their prescriptions, because of—

Hon Dr Nick Smith: It’s $2.

Hon Annette King: It is only $2 to Nick Smith, but it is a lot of money to pensioners in New Zealand, like the pensioner from Flaxmere who had to pay an extra $39 just to pick up the prescription, which was the difference between being able to buy her groceries that week or not.

Hon TONY RYALL: Clearly, I have to look at the facts behind that, because if the prescription charge has gone from $3 to $5 it is hard to rationalise how it would be $39 more when no person need pay more than $40 a year by getting a prescription subsidy card.

Hon Annette King: Why, after all his announcements and reports about increased funding and more doctors, have three medical centres providing services to high-need patients and rural New Zealand been forced to close in the past few weeks, stating their reasons as a lack of funding and a shortage of doctors—they include the Pētone health centre, Te Atiawa Medical Centre, and SouthCare Medical Centre?

Hon TONY RYALL: SouthCare Medical Centre may have closed, but the doctors have opened up next door, but the member does not want to tell people about that. This Government has invested an additional $130 million in primary care, and we have also been the first Government to make after-hours care free for under-sixes.

Rt Hon Winston Peters: That’s rubbish.

Hon Annette King: It is rubbish. Is he aware that the increased funding that a small, low-cost health centre providing services to the poorest, sickest patients got out of his Budget was around $15,000 in total, and how many more medical centres will be forced to close through a lack of funding and a lack of doctors, when he has been telling this House that there are 1,000 more of them—and where are they all?

Hon TONY RYALL: Those 1,000 extra doctors are with the 2,000 extra nurses working in our public hospitals today. They are delivering record elective surgery and more specialist

appointments, and that just goes to show—when that member was the Minister of Health, she doubled the health budget, and fewer people got operations.

Hon Annette King: Where are the extra doctors for primary health care—because in his answer, he mentioned more specialists and more hospital doctors, but where are the extra doctors he promised for primary health care? We are seeing practices around New Zealand that are unable to carry out their work because of the shortage, something he said—

Mr SPEAKER: Order! We are now getting a very long question being delivered to the Minister.

Hon TONY RYALL: I think the member will find that there are actually more general practitioners registered than there were when she was the Minister of Health. We have put additional money into primary care. We are providing more funding. We are getting a very, very good service for New Zealanders, and, in fact, we have put in extra money to have free after-hours visits for under-sixes. When that member was the Minister of Health, she never provided free afterhours general practitioner visits to children under 6.

Brendan Horan: Would the Minister agree that New Zealanders with diabetes deserve accurate and reliable medical devices to measure blood glucose levels, as afforded in previous health budgets?

Hon TONY RYALL: Yes. That is the reason why Pharmac has undertaken quite an extensive and clinically-led process in respect of the new meters that it has brought in.

Housing Supply—Auckland and Christchurch

7. SIMON O’CONNOR (National—Tāmaki) to the Minister of Housing: What initiatives is the Government taking to address housing supply in pressured markets like Auckland and Christchurch?

Hon Dr NICK SMITH (Minister of Housing): We have got initiatives under way that have the Government directly building more houses than any Government in over 20 years. That includes projects like Hobsonville, the McLennan Park development in Papakura, “infill 500” in Auckland, and the 700 New Builds and Rangers Park development in Christchurch. We also have initiatives involving council and community partnerships. This includes the major Tāmaki redevelopment, involving intensification and thousands more homes in this part of Auckland, and initiatives with the Social Housing Fund, which will see the biggest ever growth in the community social housing sector next year. We also have important regulatory changes under way in both Auckland and Christchurch that will streamline the planning process and facilitate thousands more homes being built in the private sector.

Simon O’Connor: What parallel measures will be required to support the Government’s aim of an additional 39,000 homes in Auckland, and initiatives like Tāmaki and Hobsonville?

Hon Dr NICK SMITH: Firstly, the Government recognises that developing Auckland’s infrastructure, in parallel along with housing developments, is critical. We also recognise that redevelopments like Tāmaki are challenging for communities, and work best with a strong level of community engagement. That is why the Tāmaki redevelopment is a partnership with the Auckland Council, and why last week I, along with Mayor Len Brown, released for public consultation a draft blueprint for the regeneration of Tāmaki, of Glen Innes, of Point England, and of Panmure.

Simon O’Connor: Is the Government taking any initiative in other housing markets under pressure to support more affordable housing?

Hon Dr NICK SMITH: Yes, we are. Today I have announced a $1 million grant to the Queenstown Lakes Community Housing Trust to build 10 affordable housing units in Arrowtown. I was appalled to read that some residents were using council processes to oppose this housing, saying they did not want low-income people living in that town. We need to stare down this sort of nimbyism if we are to tackle this issue. The Productivity Commission rightly identified a real problem with our regulatory system that incentivises building homes only for the top quartile, as occurred under the previous Government.

Te Ururoa Flavell: Tēnā koe, Mr Speaker. Kia ora tātou. Has the Minister seen the proposal by the Ikaroa-Rāwhiti Māori Party candidate, Nā Raihānia, that the Government should sell surplus State houses in low-demand areas to low-income families to improve Māori homeownership in places like Gisborne, Hastings, and Wairoa; if so, is he prepared to consider the idea?

Hon Dr NICK SMITH: I appreciate the idea that the Māori Party has put forward and the strong advocacy that the Māori Party has given to homeownership. The Associate Minister of Housing Tariana Turia has exciting initiatives under way to expand the role of iwi in social housing provision and better integrating it with the Whānau Ora services that she is providing. The idea of selling surplus State houses in low-demand areas to low-income earners is an idea—

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. With the greatest respect, you must have heard what he said there. In the Māori world they would be shocked to hear what he said there. But I would like him to have the chance to correct what he said. I am sure he meant not “Whanei Ora” but “Whānau Ora”. Perhaps he could pronounce it properly.

Mr SPEAKER: And the member is abusing the point of order system to interrupt a legitimate answer by the Minister. I will not put up with that sort of behaviour from the right honourable member for much longer. Supplementary question, Brendan Horan.

Brendan Horan: As—[Interruption]

Mr SPEAKER: Order! I have called Brendan Horan for a supplementary question.

Brendan Horan: Thank you. As approximately 3,400 housing resource consents are processed per year in Auckland, and given that town planners there are already working to 100 percent capacity, what training and recruiting for new town planners in Auckland is the Minister aware of to cater for the additional 39,000 consents promised over the next 3 years?

Hon Dr NICK SMITH: My ministry is working closely with the Auckland Council on ensuring that those targets in the Auckland Housing Accord for 39,000 houses are able to be advanced at pace. If the Auckland Council indicates that a shortage of planners is part of its issues, I would be happy to consider what support the Government might be able to provide, in a similar way to the way in which the Government is providing support to the Christchurch City Council to help it address both its resource and its building consent challenges.

Brendan Horan: I raise a point of order, Mr Speaker. Is the Minister saying that he is unaware of any town planners—

Mr SPEAKER: Order! The member is now using the point of order system to effectively try to raise another supplementary question.

Disability Care, Legislation—Attorney-General’s Advice

8. JAN LOGIE (Green) to the Minister of Health: Does he agree with the Attorney-General’s advice that the New Zealand Public Health and Disability Amendment Bill (No 2) unjustifiably limits the right to judicial review; if not, why not?

Hon TONY RYALL (Minister of Health): The Attorney-General gives advice to the House as a law officer in order to inform debate. I am advised that reports under section 7 of the New Zealand Bill of Rights Act by the Attorney-General that legislation appears to be inconsistent with the New Zealand Bill of Rights Act have been issued about 60 times since 1990 under all Governments. Although the Government noted the Attorney-General’s advice, the Government was satisfied that the limitation of any right to judicial review was appropriate in this case, having regard to the need to manage the balance between family and taxpayer responsibilities and to support an effective and fair policy for payment of family caregivers.

Jan Logie: Taking that as a no, on what basis does his view on the rule of law hold more weight than that of the Attorney-General, the Law Society, and many legal luminaries, such as Professor Andrew Geddis?

Hon TONY RYALL: The Government’s view carries weight because it enjoyed the majority of Parliament behind it, and it was because this Government had to deal with the issues raised by the

Atkinson case. Those issues about making decisions about the use of public money are rightfully decisions that should be made by Parliament and not by the courts.

Jan Logie: Is the Minister aware that by removing the right of judicial review, gutting all domestic appeal provisions, family carers can now go straight to the United Nations Human Rights Council to have a discrimination case heard on the international stage?

Hon TONY RYALL: The legislation of New Zealand has a myriad of examples where there is discrimination. New Zealand superannuation discriminates on the basis of age. The jobseeker support allowance discriminates on employment status. In respect of the matter with the family caregivers, the Government had to take action in this way because we need to be able to start paying the carers of family members as quickly as possible, without delay by the courts.

Jan Logie: I raise a point of order, Mr Speaker. That did not answer my question at all.

Mr SPEAKER: I think that is a fair comment on this occasion. Would the member, please, for the benefit of the Minister, repeat the question.

Jan Logie: Is he aware that by removing the right of judicial review, effectively gutting domestic appeal provisions, family carers now can go straight to the United Nations Human Rights Council to have a discrimination case heard on the international stage?

Hon TONY RYALL: Yes, they can apply. I hope those family caregiver case people might actually observe that New Zealand is one of only three countries in the world that will pay wages to family members to care for other family members. Behind the Netherlands and Sweden, New Zealand is one of only three countries in the world taking this action. We are investing $72 million over the next 4 years to support an estimated 1,600 family caregivers to care for their family members.

Jan Logie: Considering that discrimination was proven at the New Zealand Human Rights Review Tribunal, the High Court, and the Court of Appeal, will he admit that as well as entrenching discrimination against some of the most vulnerable New Zealanders, he has also exposed his Government to legal risk and international shame due to the removal of all domestic appeal provisions?

Hon TONY RYALL: I do not agree with that. I think that internationally New Zealand is viewed as one of only three countries in the world that are going to pay wages to family caregivers—$92 million over 4 years. And remember that a party in Government that that member supported expressly decided in 2008 not to pay family caregivers. This Government has.

Canterbury, Recovery—Mental Health Services

9. NICKY WAGNER (National—Christchurch Central) to the Associate Minister of

Health: What is being done to address the mental health needs of people in Canterbury?

Hon TODD McCLAY (Associate Minister of Health): This Government has taken a number of actions, particularly in relation to young people. The Ministry of Health is working closely with the Canterbury Earthquake Recovery Authority and other Government agencies in this area. Although the majority of people who need mental health support following the earthquakes can receive that care from support services such as relationship support, the Government has ensured that additional services are available for those who need them. A range of primary mental health services are available from Canterbury primary health organisations, and this includes screening and brief interventions for alcohol issues, other drug issues, and other mental health issues. The Canterbury District Health Board now also provides specialist support teams for people who require more specialist interventions.

Nicky Wagner: Are there still concerns about people’s mental health?

Hon TODD McCLAY: Yes. Most people recover well from distress caused by the earthquakes. However, international experience tells us that psychosocial recovery generally lags behind immediate physical recovery. Some people, depending upon their individual circumstances, can be expected to take longer to recover from the impact of the earthquakes, and services are prepared to

provide that support over the longer term. This Government has recognised this and continues to monitor and address any mental health and resilience issues in Canterbury on an ongoing basis.

Nicky Wagner: There has been some community concern regarding the impact of the earthquakes on young people. Can the Minister tell the House what he is doing to address those concerns?

Hon TODD McCLAY: Yes, I am aware of this concern. In April of this year, because of concerns about an increase in the number of young people being referred to mental health services, the Government directed that a youth mental health action plan be implemented in the region. That plan is being implemented by the Canterbury District Health Board, the Ministry of Education, and the Ministry of Social Development, and it includes an oversight group to ensure that the agencies work together. School-based mental health services support the involvement of guidance councillors, which is an extension of the Canterbury All Right campaign, with a particular emphasis on youth. Actions being taken as part of the Prime Minister’s Youth Mental Health Project will also increase resilience and assist in responding to concerns about the mental health needs of children and young people in Canterbury.

Intelligence Agencies—Sharing of Information on New Zealanders

10. CLARE CURRAN (Labour—Dunedin South) to the Prime Minister: Does he stand by his statement of 11 June 2013 that “I can assure the House that we do not use our partners to circumvent New Zealand laws”?

Rt Hon JOHN KEY (Prime Minister): Yes.

Clare Curran: How can he justify his statement this week that his new laws will not expand the Government Communications Security Bureau’s powers when three telecommunications network companies, an international service provider, and the New Zealand Law Society all told a select committee today that these powers will be expanded and that they do not support this?

Rt Hon JOHN KEY: Because it is correct.

Clare Curran: How can he continue to deny the expansion of the Government Communications Security Bureau’s powers through his new legislation when the major New Zealand - based telecommunications companies, which invest millions of dollars into our local economy, told the select committee today that this will have a chilling effect on their investment and development in new networks?

Rt Hon JOHN KEY: I think the member is showing her ignorance by confusing the Telecommunications (Interception Capability and Security) Bill with the Government Communications Security Bureau and Related Legislation Amendment Bill.

Clare Curran: Are there comparable protections in his new legislation for the privacy and rights of New Zealand citizens and businesses alongside the expansion of the bureau’s powers to become a domestic spy agency?

Rt Hon JOHN KEY: I reject the member’s premise.

Clare Curran: Given the revelations last week that the Government Communications Headquarters—the British equivalent of the bureau—is attaching intercept probes on to transatlantic fibre-optic cables where they land on British shores, does the bureau intercept the Southern Cross cable or any other transoceanic system that connects New Zealand’s internet to the rest of the world?

Rt Hon JOHN KEY: I do not believe it is in the national interest to talk about those matters.

Clare Curran: Is he aware of the concern raised in Google’s submission to the select committee that requiring global internet companies based outside New Zealand to undertake interception may put them in conflict with statutory privacy and confidentiality obligations in other countries; in other words, enforcing his law might force companies such as Google to break other laws?

Rt Hon JOHN KEY: The member should direct her question to the Minister responsible. She is getting terribly confused between the Telecommunications (Interception Capability and Security)

Bill and the Government Communications Security Bureau and Related Legislation Amendment Bill.

Civil Defence Emergency Management System—Response to June 2013 Extreme Weather

Event

11. PAUL FOSTER-BELL (National) to the Minister of Civil Defence: What reports has she received on how civil defence managed last week’s extreme weather events across New Zealand?

Hon NIKKI KAYE (Minister of Civil Defence): Despite the severity of the storm that hit most of New Zealand, communities have responded very well. Forecasts have been timely and accurate, and people have listened to those forecasts and prepared appropriately. Communities have been very well served by their emergency services and community-based civil defence organisations. Many of these organisations had planned for the impact of this event and were able to maintain essential services while responding to calls for assistance. Emergency services, civil defence staff, and council crews have all worked extremely hard in difficult and dangerous conditions, sometimes with real risks to themselves. I want to acknowledge them and thank them for their service.

Paul Foster-Bell: What lessons does the Minister believe can be taken away from this most recent storm?

Hon NIKKI KAYE: As with all scenarios involving extreme weather, people should pay close attention to advice from local authorities and civil defence emergency management groups. It is also important for people to reach out to neighbours and people in communities who may be vulnerable during these times. The recent response to extreme weather has demonstrated the effectiveness of community-based civil defence organisations and reinforces that our civil defence structure is working well. Local knowledge is vital for effectively responding to local events. I would again commend the emergency services, civil defence staff, and council crews who have all worked so hard over the last week to minimise the impact of the storm.

Prostitution Reform Act 2003—Prime Minister’s Statements

12. Le’aufa’amulia ASENATI LOLE-TAYLOR (NZ First) to the Prime Minister: Does he still stand by his reported statement that the Prostitution Law Reform Act 2003 “hasn’t actually worked”?

Rt Hon JOHN KEY (Prime Minister): Yes. One of the key purposes of the Prostitution Reform Act was to prohibit prostitution for under-18-year-olds. I do not believe it has been effective in doing that.

Le’aufa’amulia Asenati Lole-Taylor: What progress, if any, has his Government made in addressing street prostitution since he stated in December of last year in regard to street prostitution that “the Government is looking to, through the Local Government Act, make other changes that would support local government.”?

Rt Hon JOHN KEY: Well, I think that the member—because she has an interest in this issue, and I accept that—is aware that the matter is before the select committee. I think also that the Government’s view has been consistent in this matter, and it is that the Local Government Act, on the advice that we have had, does empower the territorial authorities to make by-laws for the issues that have been mentioned. The Government’s view, therefore, is that not only do the councils have the capacity to do that through the Local Government Act, but also if there was to be a change to give the local councils even greater powers, then I think the Government’s view would be that that should be spread across all councils around New Zealand, not something specific to Manukau.

Le’aufa’amulia Asenati Lole-Taylor: Given that answer, does he then agree with his National Party colleagues that in regard to the issue of street prostitution “Government has continued to pass responsibility to local councils and as a result is causing ratepayer costs and consequential rate increases.”?

Rt Hon JOHN KEY: Firstly, I think it would be useful if the member were to reference that quote to the member who made it, because otherwise I cannot be sure of its authenticity. But what I can say is that it has been a longstanding practice that in these areas the matters are handled, and rightfully so, by local government. That is why the Local Government Act actually empowers councils to make by-laws to prohibit street prostitution.

Le’aufa’amulia Asenati Lole-Taylor: Given that sad response—[Interruption]

Mr SPEAKER: Order! Would the member please ask the supplementary question.

Le’aufa’amulia Asenati Lole-Taylor: I am getting there. Is the Prime Minister aware of a legal opinion made available to the Auckland Council that advises that enforceable by-laws cannot be made to restrict trading hours or areas for street prostitution because any by-law will both contravene the Prostitution Reform Act and potentially run foul of other Acts of Government, and what does he have to say to residents and ratepayers of Hunters Corner, Papatoetoe, and numerous other communities in South Auckland and across the country who have to deal day after day with the numerous health and safety issues that street prostitution causes in their communities?

Rt Hon JOHN KEY: No, I have not seen that legal opinion. I am aware of Crown Law’s view, which is that the Local Government Act does support territorial authorities to make by-laws. In fact, I would point out to the member that the Auckland Council, when it put out its report in May 2012 called The street prostitution industry in the southern communities of Auckland, at page 12 it actually set out quite clearly how the Local Government Act does support authorities in terms of making those by-laws. I think the point the member is making is that maybe those by-laws need to be widened. That may or may not be a fair point. The point I would simply make to the member is that if that law were to be progressed further, in my view, it should be expanded beyond just the streets of Manukau, and if that were the case, we may well look at it.

ENDS

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