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Questions And Answers June 16




State-owned Assets—Crown Equity in Energy Companies and Air New Zealand

1. Hon DAVID PARKER (Labour) to the Minister of Finance: What was the combined increase in the value of the Crown’s equity in Meridian, Mighty River Power, Solid Energy, Genesis and Air New Zealand for each of the last five years?

Hon BILL ENGLISH (Minister of Finance): According to the Crown financial statements, the combined value of the Crown’s equity in these five entities was $11.1 billion as at 30 June 2010. This figure compares with $7.1 billion 5 years earlier. If the member wants the year-by-year numbers, they are $7.1 billion in 2005, $9.6 billion in 2006, $11.1 billion in 2007, $10.1 billion in 2008, $10.4 billion in 2009, and $11.1 billion in 2010.

Hon David Parker: Was the $3 billion increase in value of the State-owned enterprises that the Minister has just told the House about additional to the dividends received, which were accounted for as revenue?

Hon BILL ENGLISH: Yes, because they are two different things. One is a cash payment to the Crown; the other is an increase or change in the value of the company. Of course, as the member will know, there is a process that sits alongside what is recorded in the Crown accounts, and that is the commercial valuation.

Hon David Parker: Was the increase in value also additional to the over $1 billion of capital distributions during that period?


Hon Members: Oh!

Hon BILL ENGLISH: Well, not quite, in the sense that a fair bit of the $1 billion of capital dividend actually came from the sale of some energy assets to foreigners.

Chris Tremain: What factors account for the increase in State-owned enterprise values, and what actions has this Government taken to improve State-owned enterprise governance?

Hon BILL ENGLISH: Probably a major contributor to the lift in value was the fact that electricity prices increased quite dramatically through the period of the early 2000s, so it is hardly surprising that the value of the generators increased. The Government believes that the extraction of revenue from consumers by State-owned enterprises whose actions are not fully transparent, operating in a market that is short of competition, is not a good way for the Government to get revenue. That is why we have restructured the electricity market to make it more competitive, and taken a range of measures to make State-owned enterprise performance more transparent.

Hon David Parker: Is the reason the Minister continues to downplay total returns from Stateowned enterprises the fact that he knows how unpopular his plans are to sell these profitable companies, because the vast majority of New Zealanders know they will be worse off?

Hon BILL ENGLISH: No, and New Zealanders will be better off if the Government is able to follow through on its proposal. That is partly because as the Government will retain 51 percent at least, and therefore will have control of these organisations, it will receive the benefit of any uplift in value; consumers will get a better deal from companies operating transparently in a competitive electricity market; mums and dads will get the opportunity to invest in their own economy; and, finally, we would rather pay dividends to New Zealanders than interest to foreigners.

Hon David Parker: Are the State-owned enterprises his Government is planning to sell, poorly performing with low rates of return, as he was trying to convince the House earlier in the week, or do they represent a fantastic opportunity to invest, as John Key is saying?

Hon BILL ENGLISH: Well, they are in the process of changing from the first to the second. They have been poorly performing entities paying very low dividends for the amount of capital that has been invested in them—and that is capital that comes from people who pay their power bills; it does not drop out of the sky. We are in the process of improving their performance and turning them into very good investments.

Budget 2011—Government Economic Programme

2. SIMON BRIDGES (National—Tauranga) to the Minister of Finance: How did Budget 2011 continue the Government’s programme to build faster growth, higher incomes and more jobs?

Hon BILL ENGLISH (Minister of Finance): It did that by specifically continuing a heavy investment in productive infrastructure, continuing to grow investment in research and development and innovation, providing opportunities for greater savings from New Zealanders—to which they are responding positively—and setting a credible path back to surplus, so that we can have sound Government finances and, at the same time, protect the vulnerable at all stages.

Simon Bridges: Following the Budget, what reasons are there to be optimistic about the economy’s prospects over the next few years?

Hon BILL ENGLISH: Just more good news. I have seen a number of reports that show the economy is making good progress. Specifically, I heard some statements this morning from the chief executive of Westpac bank, Gail Kelly, pointing out the difference between the positive approach to the future in New Zealand and the increasing negativity in Australia. Despite the challenges of the earthquakes, we have had the highest terms of trade since 1974, the lowest interest rates in 45 years, and 40,000 new jobs created in the last year, and we are becoming increasingly competitive, particularly with Australia, through a favourable exchange rate.

Simon Bridges: What other reasons are there to be optimistic about the economy?

Hon BILL ENGLISH: Well, another reason is that average after-tax wages continue to rise faster than prices. Although everyone’s circumstances are different and there are many challenges for New Zealand families, after-tax wages grew by 7.1 percent in nominal terms, and by 2.5 percent in real terms, in the year ended March 2011.

John Boscawen: How much higher would growth, incomes, and job levels be if Government spending, as a proportion of GDP, had been capped at 29 percent, as it was under Labour in 2004, and as it was recommended to be by the 2025 Taskforce?

Hon BILL ENGLISH: I think it is likely that the New Zealand economy would have performed better and we could have had higher incomes if there had not been a splurge in Government expenditure from about 2005 onwards, which was then compounded by the effects of the New Zealand recession and the global recession. However, that is the past. We are getting Government finances back in order and putting in place a programme to help to lift incomes across the board.

Hon David Parker: Does the projection in his Budget show New Zealand’s net investment position—that is, New Zealand’s total debt to the world, less our assets overseas; the measure he until recently said was the most important one—show New Zealand is projected to get more indebted each year, from negative 78.6 percent of GDP this year to negative 85.3 percent of GDP in 2015?

Hon BILL ENGLISH: Yes, the projections show that—with two qualifications. One is that all measures of New Zealand’s external transactions will be affected by the very large insurance flows coming into New Zealand. Secondly, there are differences of opinion about whether New Zealanders will go back to their old habits of spending more than they earn and borrowing to cover the difference. I am optimistic. I do not believe that New Zealanders will go back to the way that they were behaving in the last 10 years.

Hon David Parker: Can the Minister confirm what he said in his last answer: that reinsurance proceeds are not already shown in those figures?

Hon BILL ENGLISH: I made the general comment that insurance flows will affect all our external measures of financial transactions, including, for instance, the current account deficit, which for the first time in 30 years will have a surplus—apparently. That is mainly because of the insurance inflows, but we do not expect that to last.

Hon David Parker: Is the lack of credibility of his Budget projections, which are premised on asset sales he has no mandate for, service cuts he cannot name, and rosy growth forecasts he has failed to deliver on in the past, the reason why Standard and Poor’s has his Government’s credit rating on negative outlook?

Hon BILL ENGLISH: No, that is not true. We have made some balanced judgments about the future, and they are a lot more credible than Labour’s promises in Te Tai Tokerau to lift incomes, spend billions, and give people more jobs, when it have no way of doing that.

John Boscawen: Why did he continue with the splurge in Government spending that he has just referred to in his first 2 years as Minister of Finance and take until now, in his third Budget, to make minor changes to the interest-free student loans and the massive incentives for KiwiSaver?

Hon BILL ENGLISH: Because this is a careful, considered, and balanced Government. On the one hand we have advice from the ACT Party to rip into Government spending, regardless of the consequences for people. On the other hand Labour wants to spend a whole lot of money that New Zealand simply does not have. The Government is taking a balanced position of protecting the vulnerable, supporting the economy in a recession, but being fiscally responsible.

Simon Bridges: How is the Government creating an environment that supports higher incomes and more jobs?

Hon BILL ENGLISH: This is an interesting question, because when we hear concerns expressed about the cost of living the answer to those, of course, is to achieve higher incomes. But there has to be some kind of plan to assist the growth of incomes. The Government has focused on doing everything it can to provide the confidence that will stimulate investment and employment in the private sector, so that it will create more jobs and have the ability to pay more. I could go through a long list of the steps the Government has taken, but that is our response—a constructive response to the pressures of the cost of living.

Dr Russel Norman: Does the Minister agree that a knowledge-based economy is one of the foundations for higher incomes in New Zealand; and hence, how does it make sense that the Government cut the spending on research and development in the last Budget?

Hon BILL ENGLISH: We did not, and we would be happy to take the member through what has happened with regard to increases in research and development spending. In each of the previous two Budgets we lifted the spending on research and development, and in this Budget it has continued to go up, even though we did not appropriate more money. But as the member will know, we focus more on getting value for the money that we are spending, not just on the total amount of money, because that is not a measure of anything in particular.

Dr Russel Norman: Is it not the case that other OECD countries that are doing better than us, in terms of producing high-income jobs, have a higher proportion of Government spending on research and development than New Zealand does, and in fact that New Zealand is down at the bottom of the table for Government spending on research and development?

Hon BILL ENGLISH: Some countries do spend more than us. I think it would be difficult to generalise these days that they are all “doing better”, because many OECD countries are loaded up with public debt and are in the middle of slashing public services, slashing pensions, and slashing what public servants are paid, to try to get on top of their public debt. New Zealand is not in that position, because we have taken reasonable and balanced decisions. The member’s contention is arguable, and we would be happy to have the discussion with him.


3. Hon MARYAN STREET (Labour) to the Minister of Foreign Affairs: Have all recent actions of New Zealand’s diplomats been consistent with Government policy?

Hon CHRISTOPHER FINLAYSON (Attorney-General) on behalf of the Minister of

Foreign Affairs: I suppose that depends on what the member’s definition of “recent” is. It could, for example, refer to Jonathan Hunt, when High Commissioner in London, in which case—

Mr SPEAKER: I do not think that was quite called for.

Hon CHRISTOPHER FINLAYSON: I raise a point of order, Mr Speaker. In an endeavour to be helpful I refer to Wikipedia, the free encyclopaedia—

Mr SPEAKER: The Speaker does not need lectures on what “recent” means. It is almost ancient history.

Hon Maryan Street: Does the Government then stand by its decision to support the freedom of expression on the internet statement, delivered by Sweden at a meeting of the Human Rights Council on 10 June 2011, and is that recent enough?

Hon CHRISTOPHER FINLAYSON: I do not know that a statement made by Sweden constitutes New Zealand Government policy.

Hon Maryan Street: Did the Minister receive advice from the Ministry of Foreign Affairs and Trade about endorsing the Swedish statement, and did he approve New Zealand’s support of it, even though the UK and France, which have similar copyright infringement laws, did not support it?

Hon CHRISTOPHER FINLAYSON: That is a very particular question. The Minister is overseas, and I am the acting Minister.

Grant Robertson: Oh!

Hon CHRISTOPHER FINLAYSON: If the member wants that degree of particularity, I say to Mr Robertson, she should ask the right kind of question.

Hon Rodney Hide: I raise a point of order, Mr Speaker. I ask you to consider that supplementary question in light of the primary question that was asked, and ask you whether it follows. The primary question was about recent actions of New Zealand diplomats. I can imagine the Minister preparing for that. But the supplementary question actually related to the Government’s position on Swedish policy to do with something—heaven knows what.

Hon Trevor Mallard: I raise a point of order, Mr Speaker.

Mr SPEAKER: I do not think I need any assistance on this matter. The member makes a perfectly valid point. Where primary questions are vague, there is no way Ministers can be expected to have particular information; rather than the Speaker ruling a question out as not relating closely enough to the primary question, the Minister obviously is perfectly entitled, as the Minister did, to say that he does not have that particular information, and no Minister can be criticised for that when the primary question is so vague.

Hon Maryan Street: Does he agree with the statements of the Swedish Minister for Foreign Affairs made on behalf of a number of countries, including New Zealand, that “We call on all states to ensure strong protection of freedom of expression online in accordance with international human rights law.”, and that “Cutting off users from access to the Internet is generally not a proportionate sanction.”?

Hon Rodney Hide: I raise a point of order, Mr Speaker. I suggest that that supplementary question is out of order, because it is actually a question without notice. The primary question was about the behaviour of diplomats. The supplementary questions have nothing whatsoever to do with the behaviour of diplomats, and, in fact, if that supplementary question is allowed, I think we should go back to hearing about Jonathan Hunt.

Mr SPEAKER: The member has a valid point that these questions are a long stretch from the primary question, but we have always had a tradition that imprecise primary questions, or primary questions that leave a wide field of supplementary questions, are in order. But the risk the questioner faces is that he or she will then ask a question that the Minister cannot be expected to have the information to answer. This particular question asked whether the Minister agreed with the Minister for Foreign Affairs of another country. I could almost rule that question out on the basis that the Minister has no responsibility for that, whatsoever, but we accept questions that seek opinions. The Minister is entitled to give his opinion on whether he agrees with a particular Foreign Minister, but I certainly will not be looking for any particular answer. The Minister has a lot of licence in answering a question such as that.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. My point of order goes to your response. This question is a very specific one, which goes to whether New Zealand diplomats have been following New Zealand Government policy. It the absolute right of—

Mr SPEAKER: No, no. The member is now debating with the Speaker about my ruling. If the member asking the questions had a particular concern about this issue relating to a Swedish position being taken, whether that covered New Zealand, and these kinds of issues, it would have certainly been helpful if the primary question had indicated the general subject matter of the questioning. The Minister could then have been prepared to answer them. But to have a general primary question covering all of the recent actions of New Zealand diplomats is a very wide primary question. The remedy is in members’ own hands. They cannot expect Ministers to have detailed information on specific cases when a question is as wide as that.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. I can understand that, and Ministers are quite often not across the details of their portfolios, but you should not be telling members—

Mr SPEAKER: I will not tolerate any more of that. The member has used a point of order to criticise Ministers. The member has just used a point of order to say that some Ministers are not across their portfolios. That is unacceptable. A Minister cannot be blamed for not having detail on a particular case when the primary question is as wide as that. You will notice today that when a specific question has been asked, Ministers have answered them, because they know I will insist that they answer them. But when a primary question is as wide as this, there is no way I can expect the Minister to have detail. As I have said, asking an opinion about the statement of another country’s Foreign Minister is on the limits of the Standing Orders anyhow. But I have acknowledged that Ministers can be asked for their opinions, and if the Minister has an opinion on that matter he is certainly entitled to give it in answer.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. Can I ask that you review the tape on this matter, because the member, in fact, asked not about the Minister’s opinion on the Swedish Minister but about the Minister’s opinion on the New Zealand diplomats putting New Zealand in a position in which they supported a Swedish statement.

Mr SPEAKER: The member is debating the substance of the issue. Whenever there is controversy, I always look at what transpired. I am happy to do that, but I am pretty certain that I have not erred on this issue, in accepting that the Minister cannot be expected to have the details of this matter at his fingertips. But he is welcome to answer. I invite the member to repeat her question, because it has been so long that I want members to be aware of what the question was.

Hon Maryan Street: Does the Minister agree with a statement by the Swedish Minister for Foreign Affairs, on behalf of a number of countries, including New Zealand, signed up to by diplomats representing New Zealand opinion, that “We call on all states to ensure strong protection

of freedom of expression online in accordance with international human rights law.”, and that: “Cutting off users from access to the Internet is generally not a proportionate sanction.”?

Hon CHRISTOPHER FINLAYSON: I refer to that part of the question by the member that refers to the statements by the Swedish Foreign Minister, and say that the Swedish Foreign Minister is not a New Zealand diplomat.

Hon Maryan Street: Mr Speaker—[Interruption] I am just trying to select which of the many supplementary—

Mr SPEAKER: No, no.

Hon Maryan Street: Having effectively endorsed the report of the special rapporteur by having a diplomat sign New Zealand’s signature to a statement given on behalf of New Zealand, which finds that disconnecting users on the grounds of violating intellectual property rights law is disproportionate and a violation of the International Covenant on Civil and Political Rights, will he now acknowledge that the ability by Order in Council to terminate internet connections, contained in our current Copyright Amendment Act 2011, is a breach of human rights, and pledge to remove it?

Hon CHRISTOPHER FINLAYSON: I dispute the underlying premise of the question when the honourable member says “effectively endorsed”.

Hon Trevor Mallard: Why does New Zealand say overseas that it is a breach of human rights, but does it here?

Hon CHRISTOPHER FINLAYSON: I dispute the underlying premise of the member’s question.

Hon Maryan Street: I seek leave of the House to table the freedom of expression on the internet cross-regional statement made on behalf of the Minister for Foreign Affairs of Sweden on behalf of a number of countries, including New Zealand, dated 10 June 2011.

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

Dialysis, Access—Auckland and Waitematā

4. Hon TAU HENARE (National) to the Minister of Health: What reports has he received about improved access to dialysis for patients in Auckland and Waitematā?

Hon TONY RYALL (Minister of Health): There has been $9.2 million invested in the new, state-of-the art dialysis centre on the North Shore, which opened yesterday. At the opening I met one woman who has spent 14 years travelling from the North Shore to central Auckland by taxi for up to 6 hours of dialysis three times a week. Now she will walk 100 metres to the clinic. This is a very significant advance for the people of the Waitematā and the public health service in general.

Hon Tau Henare: What other work is under way to bring dialysis services closer to home in Auckland?

Hon TONY RYALL: The Auckland District Health Board is moving to establish more comprehensive dialysis services for patients closer to home. It is on track to establish three comprehensive community-based dialysis centres, most likely co-located near primary care clinics, with the first one planned for east Auckland by next year. We are facing an increasing demand for dialysis services because of the growth of diabetes and hypertension. A new dialysis service opened in Kaitāia last year, another is planned to open in Whakatāne, and we are investigating improved services for Wellington.

Earthquakes, Christchurch—Government Borrowing

5. Dr RUSSEL NORMAN (Co-Leader—Green) to the Minister of Finance: Will the Government have to borrow further to pay for the latest Christchurch earthquakes?

Hon BILL ENGLISH (Minister of Finance): We will not have a clear idea of that until we know the likely costs and where they fall. However, it does appear that the damage as a result of the most recent earthquakes has occurred largely in areas that already required substantial repair. The member will be aware that the Government set aside a fund of $5.5 billion in the last Budget, and that allowed for considerable uncertainty around the estimates of costs. So it could be some time before we know whether that particular event will require more money to be allocated to that fund.

Dr Russel Norman: Will the Minister reconsider the case for raising an earthquake levy, given that the most recent earthquakes have thrown into doubt what the final cost might be?

Hon BILL ENGLISH: No, we do not plan to reconsider it. The Government, as we indicated in the Budget, has the capacity to fund its share of the Christchurch rebuilding costs. There are other, more significant issues at the moment that need to be resolved to allow the rebuild to continue. Our funding is not the main one.

Dr Russel Norman: In light of his earlier comments that the Government is very keen to reduce Government borrowing, would an earthquake levy not be one way to reduce Government borrowing?

Hon BILL ENGLISH: In a technical sense I suppose it would, as would putting up taxes, raising GST further, or whatever else. The Government has come to what we believe is a pretty balanced approach whereby we are constraining Government spending and we have done a reorganisation of the taxation system, which we believe will be beneficial to the economy. Now we just want to get on with growing the economy, having resolved those issues.

Dr Russel Norman: Is he aware that the Christchurch City Council proposes to raise an earthquake levy on ratepayers, and is it not a cruel paradox that the very people who are least able to pay a levy—the ratepayers of Christchurch—may have to pay a levy, when the rest of the country does not?

Hon BILL ENGLISH: Certainly, the burden of the earthquake falls by far the most heavily on the people of Christchurch. That is why I think the rest of New Zealand will effectively be paying for the rebuild. We have borrowed the money now and it has to be repaid later, with interest. All New Zealanders will be contributing to that. The Government is working very closely alongside the city council to work out the best division of the burden of costs, including those costs that fall on the council.

Dr Russel Norman: Does the Minister stand by his earlier argument that an earthquake levy is the wrong way to pay for the earthquake rebuild when the economy is weak or in recession, in light of the fact that Treasury now predicts an average of 3.1 percent growth over the next 5 years?

Hon BILL ENGLISH: Yes. We considered all these issues in the period between the February earthquake and the Budget, and the Government believes it has struck about the right balance between, on the one hand, generalised fiscal constraint to assist the progress of the economy and get the Government’s books into order, and, on the other hand, our ability to fund the earthquake rebuild. Had the costs been larger, or had it been more difficult to get the deficit under control, of course it is possible that we could have looked at either a levy or a tax increase. In the end, we decided that that was not a good idea.

Health Services—Auditor-General’s Statement

6. GRANT ROBERTSON (Labour—Wellington Central) to the Minister of Health: Does he agree with the statement of the Auditor-General, “Despite the encouraging improvements made in the last 10 years, we do not yet have a system for scheduled services that can demonstrate national consistency and equitable treatment for all”?

Hon TONY RYALL (Minister of Health): Yes. As the Auditor-General says, we are making progress and there is still more to do with this complex and longstanding issue of nationally consistent clinical prioritisation.

Grant Robertson: Will the Minister now correct the statement he made in February to the New Zealand Herald that only 2 to 3 percent of patients are treated after 6 months, when the Auditor- General’s report shows that the figure is in fact 10 percent?

Hon TONY RYALL: I do not recall that comment, but I can say that, certainly, what the Auditor-General’s report shows is that consistently about 10 percent of the patients in their sample over some years were treated after 6 months.

Mr SPEAKER: I was not shaking my head because of anything—the member interjected why have you said something, and the Speaker had not said any such thing.

Grant Robertson: Does the Minister of Health recall saying to the New Zealand Herald on 17 February 2011 that only 2 to 3 percent of patients are treated after 6 months, and why will he now not correct that statement?

Hon TONY RYALL: I do not recall saying that, but what I may have been referring to—if that was in fact the case—was the fact that the elective surgery performance indicators show that the number of people who are on the waiting list after 6 months is more in that vicinity. That is not the number of people treated after 6 months, which is indicated in the Auditor-General’s report.

Grant Robertson: Did Ministry of Health officials request the removal of any paragraphs or specific language from the version of the report that he acknowledged in this House they had in February?

Hon TONY RYALL: I cannot answer that question, because I have not seen the draft report. But I know there was quite some discussion between the ministry and the Auditor-General, I think, around some of the numbers that were used.

Grant Robertson: Why, then, did the Minister say in the House on 17 February in reference to the February version of the report “I have the report.”?

Hon TONY RYALL: I did not have the report. If that is what is in Hansard, then it is incorrect.

Grant Robertson: I seek leave to table the February version of the Auditor-General’s report Progress in Delivering Publicly Funded Scheduled Services to Patients.

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

Earthquakes, Canterbury—Resource Consents for Lyttelton Port

7. AMY ADAMS (National—Selwyn) to the Minister for the Environment: What steps has the Government taken to facilitate resource consents for work required at the Lyttelton Port to ensure it is able to recover quickly from earthquake damage?

Hon Dr NICK SMITH (Minister for the Environment): Recovery of the port is critical to the economies of Lyttelton, Christchurch, and Canterbury, so the Government has streamlined the process for 10 resource consents, to enable rubble to be used for a new, 10-hectare reclamation— enabling some of the 8 million tonnes of earthquake waste to be put to good use. This decision was influenced by the advice I received last month in Kobe, Japan, on their recovery efforts after the 1995 quake. They noted that the Kobe port had been the eighth-busiest port in Japan prior to their quake, then dropped to 30th, and has not recovered since. Their strong advice for us in terms of our Christchurch recovery effort was to make a priority of economic infrastructure.

Amy Adams: What consultation was there on the consents, what conditions are there to ensure that the reclamation does not cause environmental problems for the country, and what reaction has there been to the consents?

Hon Trevor Mallard: I raise a point of order, Mr Speaker. We are allowed two but not three legs.

Mr SPEAKER: A number of supplementary questions have a number of parts to them, and I have never ruled them out in the past. The Minister is required to answer only one of those parts of the question.

Hon Dr NICK SMITH: The decision required specific consultation with key affected parties. Specific conditions on the consents from Environment Canterbury and the Christchurch City Council cover issues of dust, vehicle movements, noise, and stormwater management, and ensure that only clean rubble is used. The decision has been broadly welcomed, although I was disappointed that Opposition parties wanted the consent to go through—

Mr SPEAKER: The question was from the member’s own colleague. We do not need to go into what the Opposition parties might or might not have done.

Job Creation—Statement Made on Behalf of Prime Minister

8. CHRIS HIPKINS (Labour—Rimutaka) on behalf of JACINDA ARDERN (Labour) to the Prime Minister: Does he stand by the statement made on his behalf that “this Government is focused on improvements within the economy in order to create the platform on which business and New Zealanders can invest and grow jobs”?

Hon BILL ENGLISH (Deputy Prime Minister) on behalf of the Prime Minister: Yes.

Chris Hipkins: How does his Government putting over 2,000 New Zealanders out of jobs in the public sector contribute to his Government’s commitment to create jobs?

Hon BILL ENGLISH: In the next 10 years this economy will need to grow by earning a living selling things to the rest of the world, whereas in the last 10 years it grew by borrowing money and increasing Government spending. So the Government has to contain its growth. New Zealanders have stopped borrowing, and now we are all focused on earning a living in the world. That is the only way we will get higher incomes. It does mean that the real estate sector and the Government sector will have to contain their growth and perhaps shrink in places. I know that earning a living instead of borrowing is not how Labour sees the world, but it is how the rest of New Zealand sees it.

Chris Hipkins: If his Government is truly committed to creating more highly skilled jobs in the New Zealand economy, how does National’s decision to buy trains and carriages from China while laying off skilled workers at the Hillside and, possibly, Woburn workshops contribute to that goal?

Hon BILL ENGLISH: The background to that decision has been covered by the Minister of Transport in this House over the last week. The best opportunity for those workers would be to be able to move into an export-oriented industry, such as the one near the Hillside workshops that sells very high-value gas-powered fireboxes to the top end of the market in the US. It is an expanding business, with new investment, and exporting, and a business that actually took a number of the workers from Fisher and Paykel Appliances when it took its factory to Mexico. We want to create the opportunity for those workers from Hillside to get new, better-paid, and more sustainable jobs.

Chris Hipkins: If his Government is truly committed to creating more highly skilled jobs in the New Zealand economy, why has it cut industry training funding by $100 million, and overseen thousands of students being turned away from university and a drop in the number of Modern Apprentices of over 1,000?

Hon BILL ENGLISH: The member should get his facts right. In fact, there are more places in tertiary education than there have ever been, particularly in universities. In respect of industry training, the Labour Government used it as a political scheme to make it look like it was attached to skills. In fact, it was a scheme that was badly run, and tens of millions, if not hundreds of millions, of dollars were wasted on industry trainees who got no credits or qualifications at all. The Minister for Tertiary Education is cleaning up yet another Labour mess of extravagance and waste.

Chris Hipkins: If his Government is truly committed to building a skilled workforce that will meet our future needs, why is he encouraging skilled tradespeople from overseas to come here to help with the rebuild of Christchurch, rather than ensuring we train more tradespeople locally,

particularly given the skills shortages we are likely to face in the future as baby boom retirement reaches its peak?

Hon BILL ENGLISH: If the member was doing the very basics of Opposition—that is, getting to know his subjects—he would know that the Government announced a training package for Christchurch some weeks ago that provides literally thousands of places for the training that can go with the rebuild of Christchurch.

Health Sector—Cultural Competence

9. TE URUROA FLAVELL (Māori Party—Waiariki) to the Minister of Health: Does he agree that under section 118 of the Health Practitioners Competence Assurance Act 2003, the Medical Council has a responsibility to ensure the cultural competence of doctors, and what support has the Government provided to the health sector to ensure cultural competence is achieved across the health sector?

Hon TONY RYALL (Minister of Health): Yes. Under the Health Practitioners Competence Assurance Act, one of the functions of registrations authorities, including the New Zealand Medical Council, is to set standards of competence for practitioners that include cultural competence. There continues to be improvement work done in this area—for example, the Ministry of Health advises that it has funded an online cultural competence training tool, which will be widely available by the end of the year.

Te Ururoa Flavell: Does he agree with Professor Mason Durie that “Cultural competence is about the acquisition of skills to achieve a better understanding of members of other cultures”; if so, what professional development is available in the health workforce to assist the sector to be more in tune with its patients and to overcome bias?

Hon TONY RYALL: Yes. Most professional groups require practitioners to be culturally competent, and in a multicultural society like ours, we would expect that. In the case of doctors, both the Otago and Auckland medical schools specifically teach cultural competence to undergraduates. Health Workforce New Zealand has recently introduced a programme to help overseas doctors achieve registration in New Zealand, and cultural competence is a specific part of that 12-week programme.

Te Ururoa Flavell: Is the Minister aware of research that reports that Māori receive fewer referrals, fewer diagnostic tests, and less effective treatment plans from their doctors than do non- Māori patients; that they are offered treatments at substantially decreased rates, interviewed for less time, and prescribed fewer secondary services such as physiotherapy, chiropractors, and rehabilitation; and, in light of such research, will he instruct the Ministry of Health to make cultural competency a key national health target; if not, why?

Hon TONY RYALL: I am aware of some of that research. I am confident that the work undertaken by the Ministry of Health and, very importantly, by professional groups in regard to cultural competence will support medical practitioners and others, and will improve services for patients.

Science and Innovation—Professor Sir Paul Callaghan’s Statement

10. DAVID SHEARER (Labour—Mt Albert) to the Minister of Science and Innovation: Does he agree with Professor Sir Paul Callaghan’s statement on science and innovation “it’s clear that the Minister of Finance and the Prime Minister have not really seen this as a top priority”?

Hon Dr WAYNE MAPP (Minister of Science and Innovation): No, the Prime Minister himself said in his statement to Parliament earlier this year: “Over time we have prioritised science and innovation as a target for increased investment, which is why over 3 years we have lifted Vote Science and Innovation from $689 million to $773 million this year.” On top of that, of course, we have $190 million in the Primary Growth Partnership to help farmers, not penalise them. I also say I was somewhat surprised that the member did not use the full quote from—

Mr SPEAKER: Order!

Hon Dr WAYNE MAPP: —the Radio Live interview—

Mr SPEAKER: Order!

Hon Dr WAYNE MAPP: —which said: “I think Wayne Mapp has done a fabulous job.”

Mr SPEAKER: Normally a Minister, of course, can put a quote into context, but it should be done in a rather different way from that. I think we have heard sufficient on that.

David Shearer: How could he say that they have used science—

Hon Trevor Mallard: Sorry, Mr Speaker. I raise a point of order, Mr Speaker. Part of the problem is that although that answer was an egregious breach of your rules about speaking, unfortunately some of the members heard it and some of them did not. We understand that it was an amusing quote.

Mr SPEAKER: I appreciate the member’s attempt to bring some humour to the situation, but I think the House has seen a little bit of humour in it anyhow.

David Shearer: How could he say that they view science as a top priority, when Vote Science and Innovation recorded a $14 million drop in funding between 2011-12 and 2010-11?

Hon Dr WAYNE MAPP: As the member actually knows, the vote has two parts to it: the capital grant and the operating grant. Last year’s vote had a $16 million capital grant to Research and Education Advanced Network New Zealand. Of course, that funding was expended last year and is not repeated this year. So the operating vote actually went up, as indeed it does in subsequent years.

David Shearer: Does he agree with the Prime Minister’s statement in May last year that investment in science “will not only keep New Zealand competitive, but is at the heart of our strategy to boost economic growth.”; if so, does the drop in funding this year mean that science is no longer considered to be part of that strategy?

Hon Dr WAYNE MAPP: No, I do not agree with that proposition, because there was no drop. I also say that statistics indicate that manufacturing has climbed to its highest level in nearly a year, and that comes from a BNZ - Business New Zealand survey released today.

David Shearer: What does he say to the 60 percent of companies, many of them leading-edge innovative companies, that applied for his technology development grant but have been refused, and why are they not a priority for funding?

Hon Dr WAYNE MAPP: The technology development grant actually ranks at up to $22 million last year, $45 million this year, and $60 million next year.

David Shearer: Given that the Government has chosen to fund other areas such as the Customs Service and Veterans Affairs this year, and not science and innovation, has he simply failed to make the case for science and innovation to the Prime Minister and the Minister of Finance?

Hon Dr WAYNE MAPP: In each of the years the appropriation actually increases in the operating appropriations.

Hon Pete Hodgson: In the lead-up to the May 2011 Budget, how much extra money did the Minister of Science and Innovation ask for in his portfolio?

Hon Dr WAYNE MAPP: Obviously, there are always discussions. One of the issues here, of course, is the high-value manufacturing review, which is not yet released. The Government will be considering its response to that soon enough. Of course, there is a Budget next year.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. We are getting fairly close to the end of question time and of our supplementary questions. Rather than our having to use another supplementary to get an answer about how much the Minister asked for, I ask you to ask him to answer the question that was put to him.

Mr SPEAKER: The member’s point is reasonably well made. The answer did not really—the question was pretty simple. It asked a question that the Minister presumably must know the answer to: how much money he asked for in the Budget process. He may argue that it is not in the public interest to reveal that, but he should attempt to answer the question, in my view.

Hon Dr WAYNE MAPP: Referring to the answer, it is my understanding that the discussion—

Mr SPEAKER: Is this a point of order, not an answer?

Hon Dr WAYNE MAPP: I suppose it is a point of order, in fact.

Mr SPEAKER: I will hear a point of order from the Minister.

Hon Dr WAYNE MAPP: It is my understanding that discussions between Ministers relating to the Budget are kept confidential.

Mr SPEAKER: I will hear briefly from the Hon Trevor Mallard.

Hon Trevor Mallard: Why, then, were the Minister’s papers to Treasury released under the Official Information Act?

Mr SPEAKER: We are now getting into debate, rather than points of order. It is my fault; I accept the blame for that. It is an interesting little issue. A reasonable question was asked: how much funding did a Minister seek in his portfolio? It may be that this information is public knowledge through the release of papers, and a Minister may feel perfectly happy to answer it. It may be that the information is considered to be confidential, and a Minister may say it is not in the public interest to answer it. Either of those are answers. All I am asking is that the question be answered, and not some other question answered. That is all I am asking.

Hon Dr WAYNE MAPP: Yes, there were discussions between Ministers, as the documents indicate. It was considered that the issues relating to the high-value manufacturing review were not mature yet, and thus that matter was left over to 2012. That would have required an increased appropriation, over 4 years, of approximately $100 million.

Hon Trevor Mallard: Point of order, Mr Speaker.

Mr SPEAKER: I do not think I need to do that. I will invite the Hon Pete Hodgson to repeat his question. It appears that it may not have been heard.

Hon Pete Hodgson: In the lead-up to the May 2011 Budget, how much money did the Minister of Science and Innovation ask for in his portfolio?

Hon Simon Power: More than he got.

Hon Dr WAYNE MAPP: As my colleagues have pointed out, more than I got. As I said, the issue was over the high-value manufacturing review, which was a request, over 4 years, for in the region of $100 million.

Hon Pete Hodgson: I raise a point of order, Mr Speaker. We are all trying to coach the Minister, and I suggest to you that the possible answers are: “I cannot remember.”, “It is not in the public interest.”, or “X number of dollars”.

Mr SPEAKER: We have given the member the opportunity to pursue this question, and I think the House should move on now.

Hon Trevor Mallard: Was the centre to which he referred, the decision on which has been deferred to the next Budget, the only item that was not funded for which he requested funding in this Budget?

Hon Dr WAYNE MAPP: That was the principal item; there were some other issues, as well.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. Again, I refer you to the answer: “That was the principal item; there were some other issues, as well.” Is that an answer to that question?

Mr SPEAKER: I do not think we should take more time on this. I have given the Opposition a lot of opportunity to question the Minister; I think I have been pretty reasonable on it. That was an answer. The Minister indicated that the main difference between the funding received and the funding sought was the particular item that he had mentioned, and I think that is a pretty reasonable answer. Admittedly, he has not given exact dollar figures, but I still think it is a reasonable answer to the question that was asked.

Referendum on MMP—Preparations

11. CHESTER BORROWS (National—Whanganui) to the Minister of Justice: What progress is being made on preparations for the referendum on the electoral system to be held in conjunction with this year’s general election?

Hon SIMON POWER (Minister of Justice): Good progress. The Electoral Commission has recently launched an independent and neutral public information campaign to educate voters on the referendum process. All voters have recently been sent an enrolment pack, which includes information about the questions in the referendum and the consequences of each option for further reform.

Chester Borrows: What additional resources, if any, have been allocated to the public information campaign to help voters to make an informed choice at the referendum?

Hon SIMON POWER: There has been $5.4 million budgeted for the public information campaign over the 2010-11 and 2011-12 financial years. The campaign will use a variety of media: television, radio, newspapers, an 0800 helpline, and the internet, as well as printed brochures with translated versions.

War Pensions Act Review—A New Support Scheme for Veterans

12. Hon RICK BARKER (Labour) to the Minister of Veterans’ Affairs: When can veterans expect to have a full response from the Government in response to the Law Commission’s report “A New Support Scheme for Veterans”?

Hon JUDITH COLLINS (Minister of Veterans’ Affairs): Work is ongoing, but the Government remains committed to providing a piece of legislation that meets the needs of our older veterans from World War II, and the needs of our current and future veterans of modern-day deployments.

Mr SPEAKER: The question was a primary question. It did ask “when”. Although there may be no specific answer, I would have thought that some reference to that in a primary question would be appropriate.

Hon JUDITH COLLINS: It is difficult to give a date when the work is ongoing.

Mr SPEAKER: That would have been a very good answer.

Hon Rick Barker: Does the Minister agree with the Law Commission’s two principles—that veterans should be supported in a way equivalent to other New Zealanders, and that those injured when serving their country in a war or an emergency should be supported in a way above that of other New Zealanders; if so, when will this be given effect to, and how long will the National Government deem it acceptable for ACC claimants to be better supported than those veterans who have served their country and been injured in the course of that service?

Hon JUDITH COLLINS: The previous Government had 9 years to address this issue. Instead, it sent it off to the Law Commission in the last year of its term. Frankly, we are addressing this issue. It is a very complex issue, and we are not going to rush it and get it wrong.

Hon Rick Barker: What does it say about the National Government’s priorities when veterans have been waiting for a year or more for an answer to the Law Commission’s report while South Canterbury Finance’s wealthy investors were attended to immediately by having their cash and interest paid out, which cost over a billion dollars?

Hon JUDITH COLLINS: It says an awful lot about the Labour Government’s priorities—

Hon Rick Barker: I raise a point of order, Mr Speaker.

Mr SPEAKER: I say to both members that I am on my feet. The Minister could see I was on my feet, and she did not resume her seat. She may be grumpy with me for pulling her up over the first answer, but we do not start an answer like that. I accept that the question had a political dimension, and, therefore, I was not expecting from the Minister a purely benign answer. However, to start the answer with something to do with the Labour Government is barely attempting to answer the question asked. The Labour Government cannot be anything to do with the Minister’s

responsibilities. I can accept that in the fullness of an answer there may be issues that spill over from the previous Government, but to start the answer that way is not very helpful. Because time has passed, I invite the Hon Rick Barker to repeat his supplementary question.

Hon Rick Barker: What does it say about the National Government’s priorities, when veterans have been waiting for a year for an answer to the Law Commission’s report while South Canterbury Finance’s wealthy investors were attended to immediately by having their cash and interest paid out, costing the taxpayer over a billion dollars?

Hon JUDITH COLLINS: It says an awful lot about the priorities the previous Government had put in place—the legislation that required the current Government to pay back South Canterbury Finance investors straightaway. But it also says a lot about the fact that the member raising this question did not even bother to raise this issue with the select committee this morning—

Mr SPEAKER: No, no. That is not acceptable. The first part of the answer was perfectly fine.


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