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Questions and Answers - 3 November 2016

ORAL QUESTIONS

QUESTIONS TO MINISTERS

Better Public Services—Results

1. NUK KORAKO (National) to the Minister of Finance: What progress is the Government making in its programme to get better results from public services?

Hon BILL ENGLISH (Minister of Finance): Earlier this week the Government released the latest results update for its Better Public Services programme. These targets were set in 2012 by the Prime Minister and are designed to be challenging targets that may be difficult to achieve. The latest update shows we are making progress in some areas that make a real a difference, and this is the last update we will issue before Cabinet refreshes the targets. Benefit dependency continues to fall, and we have saved up to $3.6 billion of long-term liability over the past 2 years. The total crime rate for the June quarter was up 1.4 percent, but, overall, it has fallen 15 percent since 2011.

Nuk Korako: What progress is being made on targets specifically designed to improve outcomes for children and young people?

Hon BILL ENGLISH: We know that well-focused early intervention can reduce remedial spending later in the lives of those children who have real risks. We chose some quite difficult targets. For instance,Result 4 is about reducing the number of substantiated physical assaults on children, where the headline numbers show that abuse is far too high but has stopped increasing at the same rate that it was several years ago. When you dig in behind that result, it shows that we are starting to connect with the hardest-to-reach children and families—for instance, those children who suffer the worst consequences of poverty, such as preventable diseases like rheumatic fever. Other progress that has been made is on immunisation. Immunisation rates are up from 84 percent to 92 percent this year. The number of rheumatic fever cases has dropped from 177 cases in 2012 to 112 this year.

Nuk Korako: What progress is being made on Result 1: Reducing Long-term Welfare Dependence?

Hon BILL ENGLISH: The latest figures show that around 15,000 fewer people are on a main benefit over the 2 years between 2014 and 2016. Those people coming off benefits are being supported by successful programmes to support them into work and, in particular, to make their exit from benefit sustainable. Historically, getting someone off a benefit often meant that before too long they were back on the benefit. Fortunately, in a stronger economy there are more opportunities for those who are able to work. But I must point out that as we make progress with those who are work-ready, a greater proportion of those still on welfare are not work-ready, and making further progress is going to be more challenging and will require more innovation and lateral thinking.

Nuk Korako: How does the Government's priority of delivering Better Public Services contribute to its other priority of responsibly managing its finances?

Hon BILL ENGLISH: In a couple of ways. One is that we have found that when you get the Public Service to focus on the results for which it is accountable, it is much less likely to come asking for large amounts of money without a particular purpose and much more likely to be very thoughtful about how it uses the money it already has. Secondly, as we develop the tool kit for social investment, including the use of data and analytics, we are finding that well-targeted early intervention can lead, before too long, to considerable savings, simply because we can change lives. When we change lives, particularly those of our children and young people, we can help them avoid a lifetime of misery and the taxpayer a lifetime of cost.

Al-Khalaf Group—Advice

2. JAMES SHAW (Co-Leader—Green) to the Minister of Foreign Affairs: Did he ask for, or receive, any advice or assessment from officials about the stated legal threat of up to $30 million from the Al-Khalaf group; if so, what was the nature of that advice?

Hon MURRAY McCULLY (Minister of Foreign Affairs): I received advice from ministry officials prior to meeting with Mr Al Khalaf, in relation to both legal advice that Mr Al Khalaf was known to have taken regarding a compensation claim and the risks of a claim being in breach of New Zealand's World Trade Organization obligations. These formed part of an oral briefing.

James Shaw: Does he stand by his statement to me in this House on 28 May 2015 that "The Government took advice from very senior officials in the Ministry of Foreign Affairs and Trade, including from the legal division."?

Hon MURRAY McCULLY: I would want to see the full context of any statement, but I would generally be happy to stand behind all of my statements in this regard.

James Shaw: What, then, is his response to the Auditor-General's finding that "There was no assessment by ministry officials of the substance of that legal risk."?

Hon MURRAY McCULLY: I agree with that assessment. I have always been clear, in relation to the Cabinet paper, that we made no such claim, and I repeat what is in the introduction to this piece of the Cabinet paper, where it says: "While the Saudi parties would have preferred to enter discussions on the basis of seeking compensation for commercial loss as a result of Government decisions, it indicated that they had received legal advice suggesting they pursue a claim of between $20 million and $30 million." The Government has made it clear that we would not be a party to such negotiations. Those sentiments are reflected in the report of the Auditor-General.

James Shaw: Now that the Auditor-General's inquiry is complete, will he now give us his response to claims made by George Assaf on The Nation on 3 July that he had "no appetite or intention" of ever suing the Government of New Zealand?

Hon MURRAY McCULLY: I am aware that the member and others wish to cast doubt on what has been said in that respect, and I simply draw his attention to page 8 of the Auditor-General's report, where, as a matter of fact, the Auditor-General found: "The Al-Khalaf group indicated that it considered it should be paid compensation of $24 million."

James Shaw: I raise a point of order, Mr Speaker. My question was whether Mr McCully would answer a claim by George Assaf on The Nation; it was not in relation to what he was quoting from the report.

Mr SPEAKER: I think on this occasion I am going to give the member the benefit of the doubt. I think it has been addressed, but I will allow the member to ask the question again so that we are absolutely sure that it has been addressed.

James Shaw: Now that the Auditor-General's inquiry is complete, will the Minister now give us his response to claims made by George Assaf on The Nation on 3 July that he had "no appetite or intention" of ever suing the Government of New Zealand?

Hon MURRAY McCULLY: I am aware of many different claims that have been made in relation to the history of this matter. The Auditor-General had the opportunity to view all of the paperwork and talk to any parties that she felt she should talk to, and she recorded her finding on page 8: "The Al-Khalaf group indicated that it considered it should be paid compensation of $24 million."

James Shaw: I raise a point of order, Mr Speaker. My question was in relation to a specific claim by Mr Al-Khalaf's business partner George Assaf.

Mr SPEAKER: Order! I have heard quite enough. The essence of the question was "will the Minister now give his response to that statement", and the Minister has certainly given his response—clearly not to the satisfaction of the member, but I think on this occasion, when I hear the answer that has been given, it was actually addressed on the first occasion.

James Shaw: Was Mr Al-Khalaf's business partner George Assaf lying when he said that they had "no appetite or intention" of suing the New Zealand Government?

Hon MURRAY McCULLY: I have no responsibility for what Mr Assaf or anyone else, including various television programmes, might have said about this matter. The member and others kicked up a large fuss, used some very florid language, and made some very strong accusations to provoke an audit office inquiry into this matter. The Auditor-General spoke to everyone she wanted to speak to, looked at all of the paperwork that was available, and made it very clear that the Al-Khalaf group indicated it considered it should be paid compensation of $24 million—that is the direct quote from the Auditor-General's report.

James Shaw: Does he accept the finding in the Auditor-General's report that "settlement of a grievance was provided under the guise of a contract for services"?

Hon MURRAY McCULLY: I have made it clear that I accept all of the conclusions of the Auditor-General's report, including those referred to by the member, and also, in particular, the statement made by the Auditor-General that the contract for services was a fully lawful contract for services and that all of the elements of the contract were discharged in relation to the appropriation granted by Parliament.

James Shaw: Given that response—that he does accept that the deal was a settlement of a grievance—why was it not signed off by the Crown Law Office or by a court judgment, as is required by Cabinet Office circular CO(15)4?

Hon MURRAY McCULLY: The Auditor-General has made very clear her finding as to the legality of the arrangement. The report makes it very clear that the contract for services was a fully lawful contract for services and that it was undertaken in a manner that was consistent with the appropriation granted by Parliament.

James Shaw: I raise a point of order, Mr Speaker. My question was quite specific, outlining a quote in the Auditor-General's report, about the requirement for payments above $75,000 to be signed off by the Crown Law Office or a court judgment. Mr McCully has not responded to that question.

Mr SPEAKER: No, no. Mr McCully, in my opinion, has responded and has addressed it clearly—not to your satisfaction, but he has, effectively, said that it met the requirements. So that is his answer that has been given to the House today.

Housing Market—Property Speculation and Impact on Financial Stability

3. GRANT ROBERTSON (Labour—Wellington Central) to the Minister of Finance: Is he concerned that the New Zealand economy is unbalanced towards speculation in housing given that the value of New Zealand's housing stock is now $998 billion, eight times the total value of the New Zealand stock market, and is that valuation of the housing market a risk to financial stability?

Hon BILL ENGLISH (Minister of Finance): No, not particularly concerned. The Reserve Bank has a series of tools available to ensure financial stability, as it is obliged to by the Reserve Bank of New Zealand Act. So it has, for instance, quite conservative capital requirements on our banks and it also uses loan-to-value ratios as a way of restricting demand for borrowing for housing. I believe that these tools are robust enough to ensure that even if the housing market stops rising and if some households come under pressure because they borrowed a lot at the peak of the market, that does not represent a threat to financial stability.

Grant Robertson: In light of that answer, why, then, has the Reserve Bank Governor described inflated house values as a threat to financial stability in all of his financial stability reports in recent years?

Hon BILL ENGLISH: I would have to go and check exactly what language the Reserve Bank Governor has used. There is no doubt that a housing market rising this quickly can represent a risk. That risk is being well managed by the Reserve Bank. Also, most of these decisions are made by New Zealanders who run the risk of losing their life savings if they get it wrong. So, yes, it is a source of risk, but I do not believe there is currently a threat to financial stability from the housing market.

Grant Robertson: What does it say about the balance of the economy under his watch when the number of renting, hiring, and real estate companies increased by 11.6 percent at the same time as a number of businesses in productive parts of the economy such as IT and manufacturing were dropping?

Hon BILL ENGLISH: Of itself, it probably does not tell us much. I mean, you only have to be a single person to set up a real estate agency—and there has been a fair bit of that on the back of an increase in the housing market. You have to be a larger entity to survive in manufacturing or IT. The fact is that we have record low interest rates, strong population growth, and, therefore, strong demand for housing. This is a challenge of growth and, fortunately, the New Zealand economy is reacting to it with resilience. In time, the housing market will run through and capital will through flow to other parts of the economy.

Grant Robertson: How does he think imbalances in the economy will improve when, according to Statistics New Zealand's latest business demography release, there were fewer new businesses created in New Zealand this year than last year and the number of new businesses created in the last year is 6 percent lower than in 2008?

Hon BILL ENGLISH: Of course, you would have to have a look at that to see what you think that might mean. But if the member is looking for indications of balance in the economy, then he might note that what is often regarded as a measure of imbalance—and that is the current account deficit—is now running at around the rate of GDP growth, which, after 30 or 40 years of fairly significant imbalance, actually shows that this economy is becoming a bit more balanced, gradually, over time, as measured by the current account deficit.

Grant Robertson: Is it correct that since the beginning of 2012, real GDP per hour figures show that we have had no productivity growth at all and that it has, in fact, started to decline in 2016?

Hon BILL ENGLISH: We have discussed at some length in the House here measures around per capita GDP, or per capita productivity. The fact is that New Zealand is going through a pretty substantial population growth. At the same time it has got rapid growth in tourism, which tends to have lower pay and is a lower-productivity sector. So it is not surprising that in this phase we have got relatively low per capita growth compared with some parts of history. But recent figures show it picking up, and in an economy growing at over 3.5 percent—one of the fastest in the developed world—I think the outlook is pretty positive.

Grant Robertson: Is it not actually the case that after 8 years, what economic growth there is in New Zealand is not from the productive economy but, rather, from a grossly overvalued housing stock, record immigration, and record household debt?

Hon BILL ENGLISH: No, actually. The member is not correct. I know he does not like the fact that we have had very high levels of new job creation, a consistent and moderate increase in real incomes for housing, unemployment under 5 percent, inflation still 0.5 percent, households—

Grant Robertson: And yet no growth, Bill.

Hon BILL ENGLISH: Household interest rates are half what they were when Labour left office. The member might not like that, but that is a positive outlook for the New Zealand economy.

Communications, Minister—Announcements on Rural Broadband and Mobile Black Spot Coverage

4. BRETT HUDSON (National) to the Minister for Communications: What recent announcements has she made regarding improving rural broadband and mobile black spot coverage?

Hon AMY ADAMS (Minister for Communications): Last week the Government announced a request for proposals for the $150 million Rural Broadband Initiative (RBI) extension and Mobile Black Spot Fund. Under the RBI extension, improved broadband will be delivered to communities unable to access broadband speeds of at least 20 megabits per second. The Mobile Black Spot Fund will improve the availability of mobile services to areas that do not have coverage from any mobile operator. A long list of State highway and tourism locations has been identified that the Government is interested in seeking proposals for, and other sites may be added by bidders. This is a unique opportunity for national and regional providers to partner with the Government to deliver increased connectivity and improved services to rural communities.

Brett Hudson: What kinds of technologies will be used to deliver the rural broadband extension?

Hon AMY ADAMS: We have intentionally not specified a technology, but instead have set out a list of user outcomes that need to be provided by the service, for example, being able to stream high-definition video without significant rebuffering; carrying out general web browsing, including accessing online banking, cloud-based applications, and education services; and being able to maintain voice and video calls without interruption, including during peak usage times. This technology-neutral approach gives the chance for both large and small telecommunications providers to show what sort of innovative solutions they may be able to offer to deliver enhanced connectivity in rural areas.

Social Development, Minister—Statements

5. DARROCH BALL (NZ First) to the Minister for Social Development: Does she stand by all her statements?

Mr SPEAKER: Is the Minister going to answer this?

Hon ANNE TOLLEY (Minister for Social Development): My apologies. Yes, in the context in which they were made.

Darroch Ball: Does she stand by her statement—[Interruption]

Mr SPEAKER: Order! Sorry to interrupt; I just want to be able to hear the question.

Darroch Ball: Does she stand by her statement "There are no specific plans to increase the number of participants on the Limited Service Volunteer programme."; if so, why?

Hon ANNE TOLLEY: Yes, I do stand by that statement. We have 800 places funded, and as I have said before to the member, we do need to make sure that the right young people go into that course, who are going to benefit from that course, and that is how we intend to continue it.

Darroch Ball: How can she say that there are no plans to increase the number of participants when the Minister of Defence has stated to me, in answer to a written question, that he will be assisting the Ministry of Social Development (MSD) to "increase the number of programme participants"?

Hon ANNE TOLLEY: Well, I have funding for 800 places. We want to make sure that the young people who go on to that course are going to take full advantage of that course, but if the Minister of Defence—I have no responsibility for Defence funding. If it is going to fund more places, we would work with it to do that.

Darroch Ball: How is it possible that two senior Ministers who sit across from each other in Cabinet cannot get together and have a coherent plan that both of them are aware of?

Hon ANNE TOLLEY: As I say, MSD funds this programme for 800 places and works with Defence to provide that opportunity. We think that 800 is currently the right number of young people who are able to take advantage of that course and do well out of it. So that is where we are funded currently by the Minister of Finance.

Hon Gerry Brownlee: Can she confirm that she and the Minister of Defence are lock step in this issue and totally determined to continue offering this opportunity to young people who might otherwise have less advantage in their life; what is more—[Interruption]

Mr SPEAKER: Order! [Interruption] Order! [Interruption] No, Mr Brownlee—[Interruption] Mr Brownlee, your microphone was off from the moment I stood up. The first part of the question is in order. There is only one leg to a supplementary question.

Hon ANNE TOLLEY: Absolutely yes.

Darroch Ball: I seek leave to table the two answers to written questions that show they are demonstrably not in lock step with this programme.

Mr SPEAKER: Just to confirm—are they very recent answers and therefore not published in the last 3 days?

Darroch Ball: One of them is.

Mr SPEAKER: I am certainly not prepared to put leave for the tabling of written questions. They are available to all members. If the member wants to make a case for one under special circumstances where he has received the answer and they have not yet been published, I may consider it.

Darroch Ball: I seek leave to table the answer to a written question that was received from the Hon Anne Tolley.

Mr SPEAKER: When?

Darroch Ball: The second of the 11th.

Mr SPEAKER: On 2 November? On that basis, I will put the leave. Leave is sought to table that particular answer, which has not yet been published. Is there any objection? There is none. It can be published.

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

Hon Gerry Brownlee: I raise a point of order, Mr Speaker. I seek leave to table a remedial comprehension course that may be of use to that member—

Mr SPEAKER: No. Order! [Interruption] Order! It goes to the point that the point of order from Mr Brownlee was not helpful to the order of the House, and I am certainly not prepared to put the leave.

Public Transport, Auckland—Capacity Constraints

6. PHIL TWYFORD (Labour—Te Atatū) to the Minister of Transport: Does he agree with the Auckland Transport Alignment Project that bus improvements can only address capacity constraints in central Auckland for up to 10 years and a higher capacity mode like light rail will be required?

Hon CRAIG FOSS (Associate Minister of Transport) on behalf of the Minister of Transport: The Auckland Transport Alignment Project concluded that the constraints on key corridors in the central isthmus can be best managed through bus efficiency improvements over the next 10 years. A higher capacity mass transit solution, whether it be bus or light rail, will be required in Auckland between 2028 and 2038. As the Minister of Transport said yesterday, officials have not yet determined what the best mass transit solution may be, with light rail being but one of the options amongst others, including a high-tech rapid bus option. It is important that officials do this work before politicians leap in, as Labour already has, because as we have seen overseas recently, light rail projects are highly susceptible to multibillion-dollar cost blow outs.

Phil Twyford: Will he rule out bringing forward light rail on Dominion Road into the 2018 to 2028 decade?

Hon CRAIG FOSS: I will rule in letting the agreed process follow its course, and not having Opposition MPs and Ministers who are running campaigns in various electorates interfere and disrupt good process. This National Government can look taxpayers and rate payers in the eye, given that it takes great care in spending their hard-earned money.

Phil Twyford: Given that his Auckland Transport Alignment Project says that rapid transit is needed on Dominion Road, it has agreed a higher capacity mode like light rail will be needed over buses and that demand would justify it happening in the first decade; why will he not just agree with Labour and Auckland Council that light rail is needed now?

Hon CRAIG FOSS: Well, in fact, I do agree with the Labour member. In fact, the Auckland Council member Michael Wood was exactly right last year when he said that light rail was not a fully formed proposal and he was protesting that we do not yet have any clear information about funding. I also agree with the Auckland Council and the press release that said Auckland and Government must align on transport. I also agree with former Auckland Mayor Len Brown who said: "Auckland's growth means government and council need to put aside politics, agree the facts, design the responses and jointly deliver transport investment across Auckland."

Phil Twyford: Can he confirm that the Auckland regional fuel tax abolished by his Government would have raised more than $900 million by now and if his Government had not spent the last 5 years rejecting Auckland Council's proposals for revenue generation there would be enough money in the fund to build light rail now?

Hon CRAIG FOSS: On the contrary, the funds raised from the excise duties across Auckland have been poured into the roading infrastructure across Auckland—a multibillion-dollar investment. I am quite sure that the around 77 percent of those in the area board of Mt Roskill who use private transport every day are probably enjoying the investment in the roading from this National Government.

Phil Twyford: Can he name one new significant piece of public transport infrastructure that his Government has initiated in the last 8 years that was not planned and signed off by the former Labour Government?

Hon CRAIG FOSS: Off the top of my head, no, but there is a difference between talking and saying, and actually raising the funds, paying for and building billions of dollars of investment in rail and billions of dollars of investment in Auckland roading infrastructure, accounted for, announced, and paid for—

Mr SPEAKER: Order! The Minister answered the question initially; it did not need much more substantiation.

Phil Twyford: Is this not just the City Rail Link all over again—National holding back Auckland's growth and prosperity out of bloody-minded opposition to Labour's policies?

Hon CRAIG FOSS: Labour's policies actually helped lead New Zealand, and Auckland in particular, into recession, albeit 6 or 7 years ago. National's policies have allowed surplus investment in infrastructure such as rail and such as road across Auckland. If Labour were to be able to implement its policies in Government we would see exactly what we saw from 2006 to 2008: an absolute economic shambles.

Trans-Pacific Partnership—Ratification

7. BARRY COATES (Green) to the Minister of Trade: Why is he advancing the Trans-Pacific Partnership Agreement, when it is widely reported that the agreement will not get through the US Congress this year and countries like Canada, Australia, and Vietnam have delayed their ratification processes?

Hon CHRISTOPHER FINLAYSON (Acting Minister of Trade): Because ratification is actually in New Zealand's best interests. I note the question talked about things being "widely reported". It is not the case that other countries are not committed to ratifying the Trans-Pacific Partnership (TPP). Most countries have the process of ratifying the TPP under way.

Barry Coates: Does the Minister agree with Nobel Memorial Prize in Economics Sciences winner Joseph Stiglitz, who called the TPP agreement the "worst trade deal ever"; the founder of Research in Motion, Jim Balsillie, who said it will inhibit innovation; and Professor Dani Rodrik from Harvard, who says the TPP agreement risks a protectionist backlash?

Hon CHRISTOPHER FINLAYSON: No. I much prefer the sentiments expressed by people like Gordon Coates, who said New Zealand never got rich by trading with itself.

Barry Coates: Given that most New Zealanders oppose the TPP agreement, will the Government now change direction and develop a 21st century trade agreement that supports market access and trade for New Zealand businesses without restricting our right to regulate in the public interest and without opening us up to be sued by foreign corporations?

Hon CHRISTOPHER FINLAYSON: It will come as no surprise to the honourable member that I dispute the phrase that began with "given that New Zealanders oppose the agreement …". He is simply wrong.

Barry Coates: Given that most New Zealanders also opposed the way his Government negotiated the TPP agreement in secret, will he follow the leader of the European Union and release New Zealand's proposals to the controversial Trade in Services Agreement currently being negotiated today; if not, why not?

Hon CHRISTOPHER FINLAYSON: I dispute the underlying supposition of that question.

Dr David Clark: Did his Government seek a ban on non-resident foreign homebuyers during the TPP negotiations; and, if not, is it aware of advice from accounting firm EY that says any tax imposed on the purchase of homes by non-resident foreign speculators will breach New Zealand's existing double tax agreements with most TPP partners, unless the tax is also imposed on New Zealand citizens?

Mr SPEAKER: There are two supplementary questions there. The Minister can address either.

Hon CHRISTOPHER FINLAYSON: I will respond to the second one and say, no, I have not read that report. [Interruption]

Mr SPEAKER: Order! That interjection will not help the order of the House.

Saudi Arabia Food Security Partnership—Legal Advice for Cabinet Paper

8. DAVID SHEARER (Labour—Mt Albert) to the Minister of Foreign Affairs: Was the Auditor-General mistaken when she said in her report on the Saudi Arabia Food Security Partnership that "We were told that Ministry legal advisers were not asked for input or made aware of this Cabinet paper or earlier related Cabinet papers"; if not, why did he claim on 27 June 2015 that Ministry legal advisers did provide legal advice for the Cabinet paper?

Hon MURRAY McCULLY (Minister of Foreign Affairs): No. The member is misrepresenting my comments of 27 June.

David Shearer: If there is legal advice, will he now make that advice available to the Auditor-General and to the general public?

Hon MURRAY McCULLY: The Auditor-General has had access to all of the information that her office has sought. In relation to a public release of the legal advice, as the member, as a member of the Foreign Affairs, Defence and Trade Committee, is aware, I think that committee requested the advice. Certainly there have been requests under the Official Information Act. I have made it clear that the legal advice on these matters is the property of the Ministry of Foreign Affairs and Trade. It has chosen not to waive legal privilege. It would therefore not be consistent with the public interest for me to undermine the ministry's position.

David Shearer: Why was the Auditor-General so incompetent that she did not ask for, seek, or see the legal advice that Mr McCully says exists?

Hon MURRAY McCULLY: I have made it clear that I, for one, respect the work that has been done by the Auditor-General, and I would not associate myself with the remarks made by the member in that question.

David Shearer: Why have he and the Attorney-General, Chris Finlayson, both repeatedly claimed, including in the House yesterday, that the Government was exposed to a legal claim by Al-Khalaf Group—or a risk—when the Auditor-General found no evidence of such a claim?

Hon MURRAY McCULLY: In relation to a question earlier today, I referred both to the words used in the Cabinet paper and to the words used by the Auditor-General, and that provides, I believe, absolute clarity that the claims made in the Cabinet paper were absolutely accurate in the eyes of the Auditor-General.

David Shearer: Does he still maintain that the Cabinet paper "wasn't drafted by me. It was drafted by officials across a number of agencies", given that the Auditor-General stated, contrary to that, that "Officials emphasised to us that the February 2013 Cabinet paper was … drafted and revised in Mr McCully's office, with involvement from Mr Groser."?

Hon MURRAY McCULLY: I have answered this question to members in writing on a number of occasions, and I stand by the response provided previously, which states that the drafting process includes consultations amongst the offices of the Minister of Foreign Affairs, the Ministry of Foreign Affairs and Trade, the Minister of Trade, the Ministry for Primary Industries, and New Zealand Trade and Enterprise. The Department of the Prime Minister and Cabinet was aware of the Cabinet paper, and provided advice on it. That response is completely consistent with the information provided by the Auditor-General.

David Shearer: Given that he still believes that paying millions of dollars to a Saudi millionaire is legitimate, will this form of payment of prominent individuals by himself or the Ministry of Foreign Affairs and Trade now become accepted practice in negotiations?

Hon MURRAY McCULLY: The primary finding of the Auditor-General, in the report released yesterday, was that some of the outrageous claims made by the member and his colleagues were simply untrue, and that the contract for services entered into was a lawful contract for services, and that the arrangements were fully compliant with the appropriation.

David Shearer: I raise a point of order, Mr Speaker. That was not an answer to my question. My question—

Mr SPEAKER: Order! I accept that there is confusion in the answer given to the question. I invite the member to ask the question again.

David Shearer: Given that he still believes that paying millions of dollars to a Saudi millionaire is legitimate, will this form of payment to prominent individuals by himself or the Ministry of Foreign Affairs and Trade now become accepted practice in negotiations?

Hon MURRAY McCULLY: I am simply going to repeat that some quite outrageous claims, some quite defamatory claims, were made by the member and others in relation to this matter. The Auditor-General completed a report, which was delivered to the Parliament yesterday, after talking to all of the relevant parties, and has made it clear that the very strong accusations made by the member and others are simply ill-founded.

David Shearer: I raise a point of order, Mr Speaker. That was further from my question than my first attempt. I am not disputing what the Auditor-General said. I am asking whether the Minister considers this to be an accepted practice in future negotiations by his ministry.

Mr SPEAKER: I have listened very carefully to the question on two occasions, and I have listened very carefully to the answer on two occasions. The member may not be satisfied with the answer, but, certainly, in the elaboration of the second answer given by the Minister, he has addressed the question. You can interpret it yourself whichever way you want. But on this occasion that question has been addressed—I accept that it was clearly not to the satisfaction of Mr Shearer.

Grant Robertson: I raise a point of order, Mr Speaker. I invite you to tell the House in what way the Minister addressed Mr Shearer's question.

Mr SPEAKER: Order! The member will resume his seat. That is a direct attempt to criticise the ruling I have given. That is a serious matter. The members might not be happy with my ruling. I am asked to make an instant decision as to whether the question has been addressed or it has not. I have done that. I would be grateful if the member would accept that and we can move on.

Grant Robertson: I raise a point of order, Mr Speaker.

Mr SPEAKER: Before I take the point of order I just want to be absolutely clear. I have made a decision. I have stated it very clearly to the member. If he wishes to relitigate it, I will take a very serious course of action. If he wants to raise a fresh point of order, I am only too delighted to hear it.

Grant Robertson: The Opposition parties are granted a number of supplementary questions on the basis of the proportionality of Parliament. We do not have an unlimited set of questions. It is very difficult for members on this side of the House to undertake the job of the Opposition in question time if Ministers are answering questions in a way that simply does not even attempt to address what we are doing here. Mr McCully has done that consistently throughout question time today.

Mr SPEAKER: Order! The member is now trifling with the Chair. I have given a decision as to the manner in which the Minister addressed the question. The member, in asking his question, may be expecting a yes or no answer. Speakers' Rulings are quite clear—I think it is on page 187—that you cannot expect that. I have interpreted that answer as addressing the question, and if the member wants to go back and relook at the answer given, particularly on the second occasion, I think he has got the ability himself to decipher that it is not going to become accepted practice.

Grant Robertson: I raise a point of order, Mr Speaker.

Hon Peter Dunne: I raise a point of order, Mr Speaker.

Mr SPEAKER: I will take the point of order from the Hon Peter Dunne first, but again, this matter has been—

Hon Peter Dunne: This is a completely different issue.

Mr SPEAKER: Then I am only too happy to hear it.

Hon Peter Dunne: I just want to draw your attention to Speakers' rulings 190/1 and 190/2 regarding the form of supplementary questions. Speaker's ruling 190/1 says: "Supplementary questions must not be prefaced with a statement." Speaker's ruling 190/2 is more specific in terms of the reference to phrases such as "given" or "in the light". In both the last two oral questions the supplementary questions have been prefaced on more than one occasion with "given". I am just seeking clarification as to whether those two Speakers' rulings still hold or whether they have been supplanted by other rulings that permit that type of conduct.

Mr SPEAKER: They certainly have not been surpassed at this stage. They were clearly written. But if I consider the number of questions, and, particularly, there were two supplementary questions—in fact, I think, three supplementary questions—earlier by the Greens member Mr Coates, and on every occasion, he started his question with: "Given that". I have been relatively lenient. If members want me to get far tougher and get down to more specific supplementary questions, as I have said on many occasions, I will do so if that be the wish of this House. But I can assure you that I think it would affect the ability of the Opposition and the tone of the Opposition questions more substantially than it would affect the supplementary questions that come from the Government side.

Dr David Clark: I raise a point of order, Mr Speaker.

Mr SPEAKER: A fresh point of order, I hope. [Interruption] Is it—no, I just need clarification.

Dr David Clark: Yes, it is.

Mr SPEAKER: Great.

Dr David Clark: It is related—

Mr SPEAKER: No, no. I just need to clear, because I am going to take a very severe course of action. So I just want the member to understand. We have discussed the issue about whether Mr Shearer's question was addressed. I have dealt with the matter. If the member raises a completely fresh point of order, I am only too happy to hear it, but if we are going to continue to relitigate, that leads to disorder, and my only alternative then is to be asking a member to leave the Chamber. Does the member wish to raise a point of order?

Primary Sector Development—Initiatives Targeting Young People

9. BARBARA KURIGER (National—Taranaki - King Country) to the Minister for Primary Industries: What reports has he received on Government initiatives to help attract more young people into careers in the primary industries?

Hon NATHAN GUY (Minister for Primary Industries): At this year's Mystery Creek Fieldays the Government launched Growing our future, which is a programme that celebrates and promotes the broad range of careers in the primary sector. We have developed a series of videos with well-known and everyday New Zealanders working in the primary sector, including Richie McCaw and Sir David Fagan. These videos have already been viewed over 27,000 times online. We have also engaged 135 primary industry ambassadors, with more being trained as we speak. These ambassadors go into classrooms up and down the country to raise awareness of the huge range of existing career paths within the primary sector, and they have already made over 500 visits to over 150 schools. It is very good news.

Barbara Kuriger: Why is this initiative so important to the future of the primary sector?

Hon NATHAN GUY: Good question. In 2014 the Ministry for Primary Industries released a report that highlighted that the primary sector will need to attract around 50,000 more people into employment by 2025 if we are to meet our export double-the-value growth target. Over half of these workers will require a tertiary or level 4 qualification. There is good capacity in our education system to meet this need, and over the last three Budgets the Government has increased tuition subsidies for tertiary agriculture qualifications by around 50 percent. There is a challenge for all of us to inspire more young men and women to obtain good qualifications and become the next robotic engineer, food safety scientist, or, indeed, environmental planner to work in the engine room of the primary sector.

Grant Robertson: I raise a point of order, Mr Speaker. I raise a point of order under Standing Order 386, "Content of Replies"—386(2): "The reply to any question must be concise ..." That was not, and has not been.

Hon Gerry Brownlee: Speaking to the point of order—

Hon Annette King: Oh, this will be long.

Hon Gerry Brownlee: Well, I can make it longer, if you need that—

Mr SPEAKER: Order! No, I will just hear the point of order.

Hon Gerry Brownlee: Thank you very much, Mr Speaker. It is somewhat of a contradiction, given the pleading that was put in front of you by Mr Robertson earlier—

Mr SPEAKER: Can I have the point of order.

Hon Gerry Brownlee: —that he now insists that answers are concise.

Mr SPEAKER: Order! [Interruption] Order! Mr Robertson, I ruled, actually, on this matter yesterday. Questions should be concise, answers should be concise, and that was certainly getting to the stage where I was about to rise to my feet to curtail it, but—[Interruption] Order! But at the end of the day, the Speaker is the sole judge as to the length of the answer.

Question No. 8 to Minister

Richard Prosser: I raise a point of order, Mr Speaker. With regard to the discussion earlier and the point raised by the Hon Peter Dunne, looking at the two Speakers' rulings from Speaker Arthur and Speaker Kidd in 1984 and 1999—

Mr SPEAKER: Can I just have the reference, please?

Hon Gerry Brownlee: Page number.

Richard Prosser: 190/1 and 190/2. Certainly, in the time that I have been in this House, Mr Speaker, many questions are prefaced with both those words: "given" or "in the light". I wonder, perhaps, if you might give some consideration, in order to assist the order of the House, to making a further statement clarifying where and when that may be used, because, obviously, if a member begins a supplementary with a statement that introduces new information, that is one situation. But if the Minister has answered the question and a member is then changing tack, perhaps, with a line—

Mr SPEAKER: Order! Bring the point to a conclusion.

Richard Prosser: —of supplementary questions, it may be relevant to that.

Mr SPEAKER: I will certainly have a look at that but my inclination, at the moment, is that the Standing Orders Committee has been called together to review Standing Orders and Speakers' rulings, and that is the opportune time to have a look at it. But, certainly, over time the content and the concept of a supplementary question—over the time that I have been here, which is a little longer than the member's—has tended to broaden. I do not think that is a bad thing. I think it is more colloquial, if you like. It gives the Opposition, I think, more opportunity. But I will raise the matter through the Standing Orders Committee—that is the appropriate time to do it.

Household Labour Force Survey—Young People Not in Employment, Education, or Training

10. JENNY SALESA (Labour—Manukau East) to the Minister for Tertiary Education, Skills and Employment: What is the total number of 15 to 24-year-olds not in employment, education, or training according to the Household Labour Force Survey released yesterday, and is this an increase or a decrease on the last quarter?

Hon BILL ENGLISH (Deputy Prime Minister) on behalf of the Minister for Tertiary Education, Skills and Employment: Yesterday's household labour force survey showed that the number of 15- to 24-year-olds not in employment, education, or training ("neets") increased by 3,000 to 74,000, largely driven by those aged 20 to 24. As the member will see from recent quarterly figures, these numbers move around a lot. For instance, in the previous quarter—when the member did not ask a question—the number of "neets" had dropped by 11,000, which was probably a few too many, actually. In this quarter it has bounced back a bit. The Government has a large number of initiatives aimed at this group, which are increasingly successful.

Jenny Salesa: Why are 15 percent of all 20- to 24-year-olds in New Zealand not in education, employment, or training—which is 11,000 more than in 2008?

Hon BILL ENGLISH: I can assure the member that the Government asks the question about what each one of these people are doing, particularly if they are on welfare. As the member will know, there is a wide range of circumstances, but, increasingly, the Government's programmes are tailored to local needs. For instance, there are parts of New Zealand where that rate is considerably above average, and we need to tailor our initiatives, for instance, through our regional growth programmes where people with local understanding of industry and job opportunities, and of this population of young people, can come up with sustainable solutions.

Jenny Salesa: Why has the number of 15- to 24-year-olds in Wellington who are not in education, employment, or training gone up by 75 percent on his Government's watch?

Hon BILL ENGLISH: I am not sure what starting point the member is using, but I can advise her that in Wellington the Youth Guarantee and the trades academies have been introduced, creating better and clearer pathways for young people into work. Also, we are now growing opportunities like the Ara hub in Auckland, which is taking the lessons from Christchurch, where we develop better methods of connecting young people to job opportunities and transforming those to Auckland. The Government has an increasingly fine-grained view of all these young people, and has every motivation to ensure that where possible they are connected to job opportunities, because that means that they can avoid what could be a lifetime of dependency.

Jenny Salesa: Why has the number of Pasifika youth not in education, employment, or training increased by 20 percent under this Government?

Hon BILL ENGLISH: This is related to the previous question. One reason would be that in 2009-10 there was a significant recession, so the numbers rose fairly dramatically through to 2011, and since then they have been declining. But I am happy to say to the member, and to anyone who is listening: the Government is always keen to hear about more and better solutions for young people who are "neets". I am guessing that this week the Labour Party will announce some sweeping sloganeering about young people in work, all of which has been tried before and most of which would fail if it tried to implement it.

Jenny Salesa: Why did the Deputy Prime Minister label our young people as "pretty damned hopeless", and why did the Prime Minister write off our young people as "lazy and on drugs"?

Hon BILL ENGLISH: The member is not correctly quoting what the Deputy Prime Minister said, but the member can be reassured that the Government and its agencies—in fact, many communities and parents—are making every effort. Of course, this group has a wide range of needs. One cannot generalise. A significant proportion, for instance, are caregivers within their own families, and, of course, the choices for them are different from those who, for instance, have a significant disability. Their choices are different from those who are simply taking a year off—that is, not doing anything—and they may, of course, just re-join the workforce—

Mr SPEAKER: Bring the answer to a conclusion.

Hon BILL ENGLISH: —when they feel like it and when there is an opportunity.

Mr SPEAKER: Question No. 11. [Interruption] Order! I am just trying to get the member a fair hearing.

Business Regulation—Announcements

11. ALFRED NGARO (National) to the Minister of Commerce and Consumer Affairs: What announcements has he made to support the ongoing regulation of the business environment in New Zealand?

Hon PAUL GOLDSMITH (Minister of Commerce and Consumer Affairs): Today I announced a funding increase of $9.8 million per year for the Financial Markets Authority (FMA) and $5.3 million per year for the Companies Office. The increased funding will help these organisations maintain a well-regulated business environment for New Zealand. The FMA's primary objective is to increase New Zealand's confidence in the conduct of financial markets. The Companies Office ensures that appropriate governance standards are upheld. Both organisations play an important role in fostering confidence and growing the economy.

Alfred Ngaro: What does this funding mean in the context of New Zealand's strong economic growth?

Hon PAUL GOLDSMITH: We are now one of a very small group of countries that has the governance books in surplus and a growing economy. We want to build on that success, and well-functioning financial markets that deepen the pool of capital available to New Zealand businesses are an important platform for future growth. Since 2011, the FMA has been developing its core activities alongside the expansion of regulatory responsibilities, mostly due to the recent overhaul of New Zealand securities law. Continued expansion in the capital markets, growing KiwiSaver balances, and strong growth of New Zealand's GDP have seen the market environment in which the FMA operates change considerably since its establishment. This funding increase will help support the Government's long-term economic plan and responsible financial management.

Alfred Ngaro: How are the extra resources being funded?

Hon PAUL GOLDSMITH: The extra resources given to the Companies Office for enforcement will be funded from existing revenue and come in the context of a reduction of overall fees. The extra resources for the FMA will come from an increase in the existing FMA levy on financial service providers. The increase in funding is needed to allow the FMA to be a proactive regulator of New Zealand's financial markets and to fully deliver on its revised mandate under the Financial Markets Conduct Act. A well-regulated environment where the laws are properly enforced by a capable and effective regulator generates benefits for all financial market participants, including financial service providers, investors, and, most importantly of all, consumers.

Accident Compensation Corporation—Standard of Care from Providers

12. BARBARA STEWART (NZ First) to the Minister for ACC: Is he satisfied that clients are receiving a good standard of care from ACC providers?

Hon NATHAN GUY (Acting Minister for ACC): Yes.

Barbara Stewart: Is it acceptable for ACC to force clients to receive a poor standard of care from the New Zealand Artificial Limb Service, his agency's preferred supplier?

Hon NATHAN GUY: The New Zealand Artificial Limb Service is a key supplier to ACC—it is, indeed, the sole provider. Clients can request to use other providers on a case-by-case basis.

Barbara Stewart: Is it acceptable that after 208 visits, one amputee did not receive a leg that she could walk on and subsequently suffered a permanent injury from the limbs provided by the New Zealand Artificial Limb Service?

Hon NATHAN GUY: Unfortunately, I cannot substantiate the claims that the member is making on behalf of the individual concerned. What I can say is that ACC meets with key suppliers on a monthly basis to discuss areas such as their performance, their service delivery, and their contract management. When a complaint is received about a provider's performance, ACC engages with the identified provider to investigate the complaint and the cause and how it can be resolved.

Barbara Stewart: If clients are entitled to "a second opinion from an independent, appropriately qualified Prosthetist." as stated on ACC's website, why are requests for second opinions being refused?

Hon NATHAN GUY: I would have to go away and get some advice on that, because I cannot substantiate the claims that the member is making in the House.

Barbara Stewart: Has ACC issued a directive to case managers to not fund visits to Orthopro; and, if so, why is ACC still backing a provider that has been found to have defrauded it of at least $47,000?

Hon NATHAN GUY: Well, I would need to have those claims substantiated. I am unaware of them. I will be taking the member at her word and in good faith. I am very happy to have the conversation with the member. I would appreciate her giving me the information so I can follow it up.

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