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Questions And Answers July 5

TUESDAY, 5 JULY 2011

QUESTIONS FOR ORAL ANSWER

QUESTIONS TO MINISTERS

Pay Equity—Gender Gap 1. CATHERINE DELAHUNTY (Green) to the Prime Minister: Does he stand by his statement about equal pay for women: “The law at the moment actually provides quite clearly that it’s against the law to discriminate on the basis of gender”?

Rt Hon JOHN KEY (Prime Minister): Yes, it is prohibited under the Human Rights Act 1993, the Employment Relations Act 2000, and the Equal Pay Act 1972. Catherine Delahunty: How can a woman take a successful case under the Equal Pay Act without information about rates of pay by gender in her workplace?

Rt Hon JOHN KEY: I am not in a position to advise an individual person when they take a case before the courts, but I am sure they are in a position to gather information by looking at other employment in the same area.

Catherine Delahunty: How can the current law be enforced when employers such as the Bank of New Zealand have refused to release salary data to those who are concerned about gender pay discrimination?

Rt Hon JOHN KEY: I am not responsible for the BNZ’s policies.

Catherine Delahunty: Is it not the case that it is very difficult for a woman to find out whether she is being paid less than a man who does the same job, because there is currently no requirement for employers to disclose that information?

Rt Hon JOHN KEY: For privacy reasons it is not generally possible for any person, irrelevant of their gender, to find out why somebody earns more or less than they do. There are a number of reasons why there is a gender pay gap in New Zealand, which currently sits at 10.6 percent. I should say that at one level New Zealand is to be congratulated because, at least in terms of the gender pay gap, ours is the third-lowest in the OECD.

Catherine Delahunty: Will he consider adopting the Green Party’s Equal Pay Amendment Bill, which requires employers to report on gender pay rates in their workplaces and release aggregated information on gender pay to employees on request; if not, why not?

Rt Hon JOHN KEY: As the bill has not been drawn from the ballot, we have not yet had an opportunity to consider it as a caucus. But I say to the member that there is probably more chance of Happy Feet having a holiday in Honolulu than there is of her bill ever being drawn, because the Labour Party is filibustering its entire parliamentary time to stop the Education (Freedom of Association) Amendment Bill.

Mr SPEAKER: Members have had their bit of fun. We will have some order. Catherine Delahunty: What is his Government’s plan to reduce the gender pay gap and ensure the Equal Pay Act is enforced, apart from more research?

Rt Hon JOHN KEY: I am glad the member asked that question. She will be aware that in 2009 the Government put $2 million into the Ministry of Women’s Affairs. The ministry is doing a number of things, which include conducting research on what employers can do to encourage more women into trades and what works to encourage more women into trades; setting up women in trades networks in Wellington and Auckland; making the case for flexible work within the accountancy sector; conducting research on career choice in the secondary school years, and how this has changed over time—

Catherine Delahunty: I raise a point of order, Mr Speaker. I very specifically asked the Prime Minister what the Government was doing, other than research, on the specific matter of the gender pay gap.

Mr SPEAKER: I think the Prime Minister did outline a range of issues. It was not just research that the Prime Minister outlined.

Catherine Delahunty: I raise a point of order, Mr Speaker. He outlined a range of issues to do with women in unfamiliar trades, and with research. He did not talk about the gender pay gap, in any shape or form.

Mr SPEAKER: The member has a further supplementary question. I cannot judge the quality of an answer. It seemed to me that the Prime Minister did answer the question. The member has a further supplementary question in which to pursue the detail of that answer.

Rt Hon John Key: I raise a point of order, Mr Speaker. Sorry, I have not finished the answer. There is a lot more that the Government—

Mr SPEAKER: I think the Prime Minister outlined quite sufficient initiatives. Catherine Delahunty: Is his comment that he “hoped people were not being paid differently because of their gender” an example of the political leadership women are looking for on this issue?

Rt Hon JOHN KEY: No, it reflects the fact that I hope employers follow the law, as prescribed under the Human Rights Act 1993, the Employment Relations Act 2000, and the Equal Pay Act 1972. I go back to the comment I made earlier that although the gender pay gap sits at 10.6 percent, it is the third-lowest in the OECD. There are a number of contributing factors to why that might be the case, but one of them is that the labour market in New Zealand is highly segregated. About half of all men and women work in occupations where at least 70 percent of workers are of the same gender, so a comparison across the entire workplace provides a misleading number from time to time.

Carol Beaumont: What concerns does the Prime Minister have about the gender pay gap of 27.5 percent in the Department of the Prime Minister and Cabinet at June 2010, as reported by the Equal Employment Opportunities Commissioner, Dr Judy McGregor?

Rt Hon JOHN KEY: We would have to look closely at it. The issue there may be, as it is in a lot of workplaces, that because different people are doing different jobs, it is not an issue of gender; it is an issue of the jobs they perform.

Catherine Delahunty: I seek leave to table a letter from the Bank of New Zealand to the finance sector union, refusing to release salary data from 19 October 2010.

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.

Catherine Delahunty: I seek leave to introduce my Equal Pay Amendment Bill to the House, given that it is claimed it—

Mr SPEAKER: Leave is sought for that course of action. Is there any objection? There is objection.

State-owned Assets, Sales—Purpose

2. Hon PHIL GOFF (Leader of the Opposition) to the Prime Minister: Is his proposal to sell shares in public assets like power companies an essential part of his plan to pay off debt and aid economic recovery; if not, what is it intended to do?

Rt Hon JOHN KEY (Prime Minister): Extending the mixed-ownership model, which was pioneered by the previous Government in respect of Air New Zealand, has a number of objectives. They are to free up capital on behalf of taxpayers to fund public assets like schools and hospitals and growth-promoting investments such as infrastructure and broadband; to broaden the pool of investments for New Zealand savers; to sharpen commercial disciplines, increase transparency, and provide greater external oversight of the companies involved, which we still own a majority of; and to provide opportunities for those companies to obtain more capital in order to grow.

Hon Phil Goff: Is page 28 of the Budget Policy Statement 2011 correct when it states that even after partial privatisation of the public’s most valuable commercial assets—the power companies— net Crown debt in New Zealand will rise from 14.1 percent last year to 28.5 percent in 2015, meaning that under his policies net Crown debt doubles even though he has partially privatised the most valuable commercial assets?

Rt Hon JOHN KEY: Yes, and the reason for that is that, amongst other things, Budget 2011 includes a $5.5 billion provision for Christchurch. So that is to bail out the people of Christchurch. What we do know is that if Labour were in Government, debt would be a lot higher than that—that is, unless it introduced its land tax, or its capital gains tax, or its financial markets tax, all of which would crush everyday New Zealanders. I look forward to campaigning against those things.

[Interruption]

Hon Phil Goff: If only he had a plan of his own. Mr Speaker—

Mr SPEAKER: The House will come to order. I blame myself; I missed that totally. We will not have any more interjections. The honourable Leader of the Opposition will ask his supplementary question. [Interruption] Before the Leader of the Opposition has even started to ask his question there is a barrage from the National Party members. It will cease.

Hon Phil Goff: Is the failure of his Government to curb that rise in debt over the next 5 years— the doubling of Crown debt—one of the reasons that 40 industry leaders interviewed by Jenni McManus said of his Government in last Saturday’s Dominion Post that they had no confidence that the National Government had an economic strategy or vision, and that it had had squandered its opportunity to improve New Zealand’s economy?

Rt Hon JOHN KEY: No. The increase in debt reflects, first, the barrage of policies we actually inherited from Labour that were unfunded, uncosted, unrealistic, and unworkable. It is a little bit like the research and development credit that Labour went out there telling people would cost $800 million, when we all know that it would cost $1.55 billion and would just add more to debt. We do have a plan. The Government is more than happy to table the plan once more. It is called the Budget and it does not include a financial markets tax, a capital gains tax, or a land tax.

Mr SPEAKER: I worry that it is turning into a contest to see who can make the most noise. Question time is not about that. [Interruption] There will not be interjections while I am on my feet. Members know that. I will get serious about that, very soon. Hon Phil Goff: Were the Labour policies that the Prime Minister just talked about the same Labour policies that he promised sincerely before the election he would not change, like “We will not be increasing GST.”, “We won’t change the threshold for KiwiSaver.”, and “We won’t cut KiwiSaver or Working for Families.”; if they are those same policies, why did he promise before the election not to change them, then he dishonours that promise now?

Rt Hon JOHN KEY: It may be lost on the Leader of the Opposition that we are having an election on 26 November, but it is not lost on the Government. The Government will be campaigning on any changes included in Budget 2011. We look forward to having that debate with the public, because I would much rather go to the country with our policies than with a land tax that 05 Jul 2011 Questions for Oral Answer Page 4 of 15 (uncorrected transcript—subject to correction and further editing) will see house prices falling, a capital gains tax that will see New Zealanders fleeing for other countries, and a financial markets tax, which is just a tax on spending, and which last time I looked was a tax very similar to GST.

Hon Jim Anderton: To the Prime Minister—

Mr SPEAKER: I will have some courtesy now. I cannot hear the Hon Jim Anderton. I must be able to hear his question.

Hon Jim Anderton: If selling $19.1 billion of State assets between 1988 and 1999 did not fix the list of unmet needs in the New Zealand economy, which he read out to the House today, why would selling what is left be likely to fix them?

Rt Hon JOHN KEY: The member actually raises a good point: what is the purpose behind this policy? The answer is to give New Zealanders assets that they can invest in, as opposed to the 64 failed finance companies, which emerged under the watch of a Labour Government—when Labour was in office—that that member was a Minister in.

Hon Jim Anderton: What is the principle that the Prime Minister is enunciating to the House and to the country today about selling assets back to the same people who own them now?

Rt Hon JOHN KEY: We want to buy more assets, and the only proposition that that party has is to borrow more money, put more New Zealanders in hock, and give New Zealanders fewer opportunities to invest. I for one want to grow the assets in New Zealand, and the invest opportunities for New Zealand, and make New Zealand a more productive country. What I do not want is a capital gains tax, a land—

Mr SPEAKER: The question was from the Progressive party. The party policies of the Labour Party are irrelevant to that question.

Hon Phil Goff: Was Mr Ryall correct when, speaking to the Finance and Expenditure Committee the week before last, he asserted that the Government had no way of preventing the onselling of individual shares to foreign corporates—that is, the shares that the Prime Minister is intending to privatise?

Rt Hon JOHN KEY: I suspect that the Leader of the Opposition is taking the Minister’s words out of context. For one reason, if Mr Ryall had been asked the full question, he would have said— and probably did say—that majority control is being held by the Government. He may well have read out the Treasury advice that says that widespread and substantial New Zealand ownership is achievable. He probably would have also noted that New Zealand mums and dads will be at the front of the queue, as will the 1.7 million KiwiSaver accounts, as will the Crown financial institutions. That is why New Zealanders will own those assets.

Hon Phil Goff: Was that Treasury advice the same Treasury advice that I have got in my hand, entitled “Crown ownership of commercial entities”, which says on page 30 that partial privatisation will lead to possible cornerstone stakes by energy multinationals in the State-owned enterprises— that is, it will not be the mums and dads; it will be the big, foreign multinationals that own a cornerstone share?

Rt Hon JOHN KEY: The Government has made it quite clear: Kiwi mums and dads are at the front of the queue—not trade sales. But if we wanted to do some trade sales, we would go to the Leader of the Opposition and ask him for advice, because he flogged them off from one end of the globe to the other when he was a Minister in the previous Labour Government.

John Boscawen: What does he think will do more to help pay off debt and aid the economic recovery: the partial sale of power companies, or scrapping the emissions trading scheme—another of the barrage of policies he inherited from the Labour Government?

Rt Hon JOHN KEY: It is quite obvious that that would be the partial sale of assets, because if one looks at the partial sale of assets, one sees that it will generate in the order of $5 billion to $7 billion, if not more. The emissions trading scheme is a net scheme of about $300 million per year.

Hon Phil Goff: Does the Prime Minister accept that assets like the power companies belong to New Zealanders and that they are not his Government’s to sell; if so, why is he privatising shares in those assets when, two to one, New Zealanders say they are against it? Is that sheer arrogance?

Rt Hon JOHN KEY: We are having an election on 26 November. That will be the opportunity for New Zealanders to vote on the policies. Arrogance would be to take a position where one passes the law and carries it out without reference to the New Zealand public. We are having reference to the New Zealand public and they can make a choice. They can vote for a capital gains tax, a land tax, or a financial transactions tax, or they can vote to buy a few shares in companies that I know they want to buy a few shares in.

Infrastructure Programme—Progress

3. AMY ADAMS (National—Selwyn) to the Minister for Infrastructure: What progress is the Government making with its multi-billion dollar infrastructure programme?

Hon BILL ENGLISH (Minister for Infrastructure): More good news. Yesterday we issued—

Mr SPEAKER: Before I invite the Minister to continue, I say to the National backbench that that kind of pathetic behaviour will not continue or someone will be leaving the House. I am deadly serious about it. It is pathetic, in this House, to cheer when a Minister starts an answer like that. A good answer can be applauded, but that was just pathetic.

Hon BILL ENGLISH: More good news. Yesterday we issued the second National Infrastructure Plan, which shows the Government will invest over $17 billion in building productive infrastructure over the next 4 years, and that is excluding the $5.5 billion set aside for Canterbury. It will see the Government investing $7.6 billion in social assets like schools, hospitals, State houses, and prisons; $6.5 billion in roads; and $1.5 billion each in broadband and rail, and doing it all with no new taxes.

Amy Adams: What are the main challenges identified by the National Infrastructure Plan?

Hon BILL ENGLISH: The plan shows that our infrastructure is generally improving, with less red tape and more investment in roading, rail, telecommunications, electricity networks, and specific projects for the Rugby World Cup. The challenges include the rebuilding of Canterbury, managing the taxpayers’ large asset base—currently $220 billion—better, and ensuring that future investment goes into areas that deliver the greatest benefits to the economy.

Amy Adams: What are the Government’s infrastructure priorities for next 3 years as set out in the National Infrastructure Plan?

Hon BILL ENGLISH: I will say that this is the first time that the Government has set out clear priorities, covering the period of the next 5 to 10 years: firstly, rebuilding Canterbury infrastructure; secondly, a comprehensive approach to investment in Auckland; thirdly, improving the management of the Government’s social infrastructure such as schools, hospitals, and State housing; fourthly, focusing transport investment on supporting export-led growth; and, finally, improving the Government’s ability to monitor the performance of all infrastructure.

Amy Adams: What has been the focus of the Government’s infrastructure programme since the election in 2008?

Hon BILL ENGLISH: The Government moved immediately with a multibillion-dollar programme to unclog our economic arteries by boosting investment in productive infrastructure. We have invested in the last three Budgets heavily in schools—the biggest ever education capital programme—and in ultra-fast broadband, which sits alongside record investment in the electricity and State highway networks. As well as that, we have worked on improving the consenting process so that large projects can get through in a matter of months rather than several years.

Child Poverty, Reduction—Priority

4. Hon ANNETTE KING (Deputy Leader—Labour) to the Prime Minister: Does he stand by his statement that “I am prepared to commit Government resources to try to lift children out of poverty”; if so, what priority has he put on the eradication of child poverty in New Zealand?

Rt Hon JOHN KEY (Prime Minister): Yes. In this year’s zero Budget the Government prioritised funding increases to health and education, in part because we recognise the fundamental role these public services play in lifting children out of poverty.

Hon Annette King: If he has done much to reduce child poverty in New Zealand, what is his response to the recently appointed Children’s Commissioner—Dr Russell Wills, a passionate advocate for children—who said at the weekend: “I don’t think it’s OK that we live in a country where children arrive at school because of their poverty … without having their basic needs met.”

Rt Hon JOHN KEY: I agree with him.

Hon Annette King: Did he see the report at the weekend that said that among the 34 countries in the OECD, New Zealand has one of the highest rates of child poverty and one of the lowest levels of investment in the first 5 years of life; if so, why has his Government increased child poverty, not decreased it?

Rt Hon JOHN KEY: No, I did not see the report. But I am pleased that despite its being a zero Budget, the Government put in $44 million extra to support children in State care. That was just one of the many steps the Government took in Budget 2011.

Hon Annette King: If he thinks his Government has done much to reduce child poverty, why did he and the Minister of Finance reject the policy proposal supporting the protection and wellbeing of our most vulnerable children, as revealed by the release of the Budget documents by Treasury last week?

Rt Hon JOHN KEY: I would have to look at the specific piece the member is talking about. What the Government did in the Budget was come up with a number of additional spending items and a number of additional programmes to help our most vulnerable young New Zealanders. That included the $44 million package I spoke of, it included increasing the levels of child immunisation, it included participation of the most needy kids in early childhood education, it included more money going into Whanau Ora, and it included an increase in performance in the education system. Of course, the Government has highlighted the fact that it wants to reform the welfare system.

Hon Annette King: Does he think that Dr Wills may know a little bit more about child poverty and what is happening in New Zealand than the Prime Minister, in light of his comments that the bulk of kids that he sees as out-patients are from the most poor and vulnerable families; if not, why not?

Rt Hon JOHN KEY: I accept that Dr Wills is a specialist. That is why the Government appointed him.

Clare Curran: I seek leave to table a poster made by the children and teachers of St Clair Community Kindergarten protesting the changes to early childhood education—

Mr SPEAKER: We are not going to table posters. The member will take that down. The member does not have the call and cannot use visual aids when she does not have the call. We do not table posters that are prepared for a political purpose, no matter how good they might be.

Schools, Rural—Ultra-fast Broadband

5. CHRIS AUCHINVOLE (National—West Coast - Tasman) to the Minister of Education: What recent milestones have been reached in connecting rural schools to ultra-fast broadband?

Hon ANNE TOLLEY (Minister of Education): Last week I visited Te Kura o Omaio, which is on the east coast of the Bay of Plenty, as part of an event to mark the first three rural schools in New Zealand being connected to ultra-fast broadband. Here we connected via the internet with my colleagues the Hon Steven Joyce at Henderson Valley School, west of Auckland, and Chris Auchinvole, who was at Granity School on the West Coast. It was a fantastic opportunity for these children to meet with other students around the country and to ensure that they have the same opportunities as those who live in urban areas. This is the first step in connecting our rural schools to ultra-fast broadband; 748 rural schools will be connected directly to fibre.

Chris Auchinvole: How did the schools use the ultra-fast broadband in the classroom?

Hon ANNE TOLLEY: When I visited Te Kura o Omaio the children connected live with the other two schools. They started with an astronomy lesson, and then went on to learn and talk about Matariki. It was absolutely great to watch the students from all three of those schools interacting with one another and talking and learning from each other. They were also identifying huge opportunities. In fact, the students at Omaio told me they want to learn Spanish, and they are investigating linking up with some schools in Spain to help them with that. This is a huge leap forward for these schools and provides the tools for much-improved learning in the 21st century.

Question No. 2 to Minister

Hon PHIL GOFF (Leader of the Opposition): I raise a point of order, Mr Speaker. I am sorry to interrupt the next question but I seek leave of the House to table the uncorrected transcript of the 2011-12 estimates for Vote Finance, where Mr Ryall said one could not guarantee, on issues of sale, that the shares would not be onsold to foreign investors.

Mr SPEAKER: A point of order is being heard and it will be dealt with in silence. I am just receiving a little advice on this matter; it is somewhat unusual. Leave is sought for that document to be tabled. Is there any objection? There is objection. [Interruption] Do those members want their colleague to be able to ask his question? The Hon David Cunliffe, question No. 6.

Hon SIMON POWER (Acting Leader of the House): I raise a point of order, Mr Speaker. I apologise to the Hon David Cunliffe, but I want to be clear about what just occurred. I understood that the Leader of the Opposition was seeking to table an uncorrected transcript of a select committee, which presumably belongs to the select committee until such time as the details of that transcript have been confirmed by the select committee, at which point that transcript would become available for the more public matter that has just occurred.

Hon Trevor Mallard: Speaking to the point of order.

Mr SPEAKER: I do not think I need help. I will come back to the member if I get this wrong. It is my understanding that the transcript related to hearings in public, and therefore the information is public anyway. What was said is actually in the public domain anyway. Were it a report of the committee, were it a transcript of a hearing when the committee was in session, not in public, that would be a totally different situation. That was why I sought advice on the matter before seeking leave of the House—to make sure that it was appropriate to seek the leave of the House. In the event, the House chose not to give leave, and that is absolutely the House’s prerogative. But, in my understanding, there was nothing wrong in leave being sought, because it was a transcript of a public hearing and what was said was already in the public domain.

Hon Simon Power: Speaking briefly to that point of order.

Mr SPEAKER: I will hear the Acting Leader of the House briefly, indeed.

Hon SIMON POWER (Acting Leader of the House): I raise a point of order, Mr Speaker. It is just so that we are clear about this from this point on. What I am concerned about is that although the matter described by the Leader of the Opposition may have occurred in public, as to the transcript recording that matter it is for the committee to determine its accuracy as to what occurred when that matter was heard in public. The Leader of the Opposition sought to table that unapproved and draft transcript, regardless of whether or not, in fact, that matter had been heard in public. It is a transcript that belongs to the committee, regardless of how the information came to be in the hands of the committee—whether it was public, or not. It has not been confirmed by the committee, and now we have a situation where a member is seeking to table a transcript uncertified, if you like, or not agreed to, by that committee. That is quite different from a version of what occurred in public being made available to the House. This is a matter that belongs to the committee, regardless of how that evidence was heard.

Hon TREVOR MALLARD (Labour—Hutt South): I think that, as all members are aware, these transcripts are verbatim transcripts, but it could just as easily be a recording made by any member of the committee or any other person there; there could have been a request for those to be tabled, as well. I think people need to look at the history of this. There was an assertion made in question time—

Mr SPEAKER: No, no. This is not relevant to the point of order.

Hon TREVOR MALLARD: Well, I think that members on this side have been looking for ways to correct misrepresentations in supplementary answers—

Mr SPEAKER: No. We are starting to get away from the point of order. It is an interesting issue that I will seek further advice on, because the honourable Acting Leader of the House has put forward an interesting argument. In my view, there is nothing that prevents leave being sought to table this particular document. The House has made a decision not to grant that leave, on the basis that it believes that it is the committee’s right to deal with a transcript. I think that was the basis—

Hon Trevor Mallard: The House doesn’t believe; one member does.

Mr SPEAKER: Well, the House made the decision, under our Standing Orders, because leave was denied. But because of the interesting situation in relation to transcripts—and I know that it is normal practice for select committees to approve the release of a transcript—I want to have a look at that before I make any definitive ruling about whether this should be an acceptable practice. I think that no harm has been done today, because leave was not granted, and I will certainly seek further advice on the appropriateness of leave being sought. It is an interesting issue. I hear what the Hon Trevor Mallard, the shadow Leader of the House, said—that it is in public, and what would be wrong with leave being sought for an electronic record that had been taken to be tabled in the House. Yet the honourable Acting Leader of the House makes the point that transcripts normally are dealt with by a committee prior to their release. I want to have a look at how those issues can be properly resolved. I will hear the honourable Acting Leader of the House further.

Hon SIMON POWER (Acting Leader of the House): I do not mean to delay the House, but Standing Order 236 may assist. Paragraph (1) states: “A report or a draft of the report of a select committee or a subcommittee is strictly confidential to the committee until it reports to the House.” Standing Order 236(2) goes on to state: “Paragraph (1) does not prevent—(a) the disclosure, by the committee or by a member of the committee, of a report or a draft report to a member of Parliament or to the Clerk or another officer of the House in the course of their duties:”. I urge you to consider that Standing Order as part of your deliberations, Mr Speaker.

Hon Trevor Mallard: Mr Speaker—

Mr SPEAKER: No, I do not think I need further help, and I am not going to take up further time right now. All I will say to the honourable member is that a transcript is not a report. I think that Standing Order is intended to cover actual reports of committees, and a transcript, I would argue, is not a report. But I think it is an interesting issue that has arisen, and I will take some time to look at it. Should there be any difficulties around the Standing Order, around this issue, the Standing Orders Committee is meeting at the moment and the matter can be considered there, as well. I do not wish to impede the opportunity of the House to deal with these matters in a way that the House sees appropriate. Today I put the leave as a member had sought leave, and it was declined. I think today no harm has been done, but I will certainly look at the matter further.

State-owned Assets, Sales—Ownership of Shares

6. Hon DAVID CUNLIFFE (Labour—New Lynn) to the Minister of Finance: Does he agree with the analysis by Brian Gaynor in the New Zealand Herald in 1999 that foreign buyers during the asset sales of the late 80s and 90s enjoyed a return of more than $13 billion in the first 12 years following the sales, and would he be happy for similar large profits to once again be lost overseas under the current Government’s asset sales policy?

Hon BILL ENGLISH (Minister of Finance): No, and no, and that is why the Government is doing it differently from Labour in the late 1980s.

Hon David Cunliffe: What measures in his privatisation policy would ensure that the shares sold by the Government would not end up in foreign hands, as they did with Contact Energy and the BNZ, given that Treasury has found “significant participation by foreign investors would be essential ...”?

Hon BILL ENGLISH: As we have said many times in this Parliament, the Government disagrees with the advice. New Zealanders will be at the front of the queue. The New Zealand Government will retain 51 percent. Even in the case of Contact Energy, which was sold down over 10 years ago, a significant proportion of those who initially bought the shares are still on the register, 14 years later. New Zealand shareholders are loyal to New Zealand companies.

Hon David Cunliffe: Is he concerned that his privatisation policy would see energy company boards answerable to foreign shareholders who care about maximising their profits, not the overall economic health of New Zealand?

Hon BILL ENGLISH: No, because the majority shareholder will be the New Zealand Government. Among the other shareholders will be the New Zealand Superannuation Fund, ACC, 1.7 million KiwiSavers, and Kiwi mums and dads. I think Labour members are trying to cover up for the faults in the programme that Labour put together back in the 1980s. We are trying to learn from their lessons when they put the Air New Zealand model together 5 or 6 years ago. Air New Zealand has worked under mixed ownership, and these companies would work under mixed ownership as well.

Hon David Cunliffe: What advice has he received about the rights of minority shareholders, especially substantial minority shareholders, including the right to compensation for lost opportunities or the right to require a majority shareholder to increase their equity or else face a dilution of their shareholding?

Hon BILL ENGLISH: I have not received any detailed information on that, but the advice I do have is that if the Government is a 51 percent shareholder, then it has more rights than all the other shareholders put together. Of course, the Government would exercise those rights.

Hon Sir Roger Douglas: Does he agree that Telecom was sold in 1990 for $4.25 billion, which in real terms is $2 billion more than its recent market capital value, and does this show that Government ownership of assets is not the economic utopia that Labour makes out, when risks involved are taken into account?

Hon BILL ENGLISH: That is a good point. People who buy into any commercial company have to face commercial risk. In fact, the value of Telecom was $16 billion in 1999, and today it is less than $5 billion. Whether the Government owned those shares or private investors owned them does not change the risks of operating in the communications market.

Hon David Cunliffe: In light of his previous answer, which essentially condones asset stripping by the buyers of State-owned enterprises, is he aware that a State-owned enterprise is legally required to exhibit a sense of social responsibility by having the interests of its community in which it operates and to be a good employer, but if energy companies were removed from the State- Owned Enterprises Act, under privatisation, their boards would be legally required to act only in the best interests of the company, regardless of the consequences for the country as a whole?

Hon BILL ENGLISH: If we are talking about asset stripping and price gouging in energy companies, it would have been under the Labour Government when energy prices went up 70 percent in 9 years. Labour sold down billions of dollars worth of assets from those State-owned enterprises and took the cash.

Hon Sir Roger Douglas: In light of his answer about the sale of Telecom, does the Minister believe that the then Deputy Prime Minister took these risks into account when Telecom was sold in 05 Jul 2011 Questions for Oral Answer Page 10 of 15 (uncorrected transcript—subject to correction and further editing) 1990 by the Government, and are these risks part of the reason behind the Government policy to partially sell some assets?

Hon BILL ENGLISH: It is a fact of history that the Deputy Prime Minister at the time was the Rt Hon Helen Clark, who oversaw the sale, and at her right hand was the Hon Phil Goff. A lot of people will not vote for Labour until it apologises for the actions it took then.

Mr SPEAKER: I am unhappy about that, because the question came from the ACT Party and was used to attack Labour. That is not, in my view, a very fair situation. To make up for it I have added one question to Labour’s supplementary questions today.

Hon BILL ENGLISH: I raise a point of order Mr Speaker. The primary question was an unusual one, I might say, but we should look at it. It referred to analysis by Brian Gaynor in the New Zealand Herald in 1999—

Mr SPEAKER: I do not need to have a debate on this matter. The Minister will resume his seat. I took the nature of the primary question into account during a number of the answers given. Considerable criticism was made of Labour in the Minister’s answers, and I accept that as being perfectly reasonable given the primary question. That was taken into account. But the ACT Party asked a question that did not require Labour to be attacked, and I did not think the Minister’s answer was reasonable. The Minister answered it perfectly properly at the start. He did not need to go on to that last attack. It caused disorder in the House, and to discourage that kind of thing I have awarded Labour a further supplementary question.

Hon BILL ENGLISH: I raise a point of order, Mr Speaker. The first point is that if you give me a point of order, then generally the practice has been that the member is allowed to finish their point of order, even if the Speaker wants to rule on it in a way that the member does not agree with.

Mr SPEAKER: Let me be very clear on this: that is not the way I operate, at all. If I do not, as Speaker, hear within a few seconds what the issue of order is—

Hon Parekura Horomia: He’s trifling with you.

Mr SPEAKER: I accept absolutely that that was not the honourable shadow Leader of the House. But if I do not hear within a few seconds what the issue of order is, I sit members down. I have even asked the Prime Minister to sit down, and I am absolutely even-handed on that point. I will not have issues debated by way of point of order. I have made it very clear in relation to this question that I considered that the primary question had some provocation in it. It sought opinion and had some provocation. I gave the Minister a lot of licence in how he answered that question. There was nothing wrong with the third party’s question, and the Minister answered it perfectly well for a start, but he then deviated into attacking Labour, which was where I became unhappy, because attacking Labour was not essential to the answering of the question from the Hon Sir Roger Douglas. The easiest way to me seems to be to give Labour a further question, in order to discourage that kind of answer.

Hon Rodney Hide: I raise a point of order, Mr Speaker.

Hon Parekura Horomia: Who’s this?

Mr SPEAKER: Order!

Hon Rodney Hide: I ask you to reflect on this. I am not challenging your ruling, but I am thinking about it going forward. This is a debating chamber and members are here to debate. It is natural that they debate policies—

Mr SPEAKER: The member will resume his seat, as well. This is actually question time, I tell the Hon Rodney Hide; this is not a debate. The rules for question time are very clear. It is not a time when we have debates. We have questions asked, hopefully, and answers given. That is enough. I have simply decided to give Labour a further question, but I will say to some of the front bench on my left—not the shadow Leader of the House, but some of his colleagues—that when points of order are being heard, they will not interject.

Hon David Cunliffe: Given that the Budget documents and the Investment Statement attached to it show only a $200 million write-down in dividends but project a $6.8 billion sale price, which implies a 3 percent return on assets, can the Minister explain why private shareholders would want to buy shares in electricity companies for a 3 percent return on assets and not push up power prices higher than they have currently been?

Hon BILL ENGLISH: Almost anything will be an improvement on how these assets were run up to 2008, when electricity prices were pushed up by 70 percent in 9 years, but the companies paid minimal dividends, equivalent to a 2 to 3 percent return. So if members want a track record of very high power prices and low returns, they will see them in relation to these assets under the Labour Government.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. Although it was long, that was a relatively simple and clear question that went to why people would buy something for a 3 percent return if they were not going to put up the prices. It was a forward-looking question, not one that looked backward. There was no attempt to address it.

Mr SPEAKER: In fairness, I do not think it is possible to tie Ministers to answer exactly the way that members may wish them to answer. The question asked about dividends and prices, and in answering the Minister went back over a bit of recent history around dividends and prices. I listened very carefully to hear whether the Minister overstepped the mark in my view in terms of attacking the questioner. I do not believe he did. I think the answer to the question was not unreasonable. It may not have been what the questioner wanted, but it was still not an unreasonable answer in my view.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. I do want to litigate. The question was about dividends and prices going forward. The reply was all about dividends and prices going back. It could not—

Mr SPEAKER: Often a way to understand how prices and dividends may behave in the future is to look at the way they have behaved in the past. It is not unreasonable in answering an economic question like that to look at what the history has been in the recent past to better understand how things might be in the future [Interruption]—the member will not interject while I am on my feet.

Roading, Auckland—Western Ring Route Progress

7. NIKKI KAYE (National—Auckland Central) to the Minister of Transport: What progress has been made on the Western Ring Route Road of National Significance?

Hon STEVEN JOYCE (Minister of Transport): I am pleased to report to the House that a giant step towards a fully functioning western ring route was taken today as the board of inquiry assessing the Waterview Connection project released its final decision, granting resource consents for the approximately $1.4 billion project. The Waterview Connection is crucial to completing the western ring route road of national significance. Other components are well under way or complete. The Hobsonville deviation and Brigham Creek extension project will be opened in the next few months, well ahead of schedule. Once completed, the western ring route will provide a 48-kilometre alternative to State Highway 1 around Auckland. It will help to ease congestion across the city, and it will improve travel times for both freight and people.

Nikki Kaye: What are the benefits of the new consenting process for local communities and the Government?

Hon STEVEN JOYCE: This is the first roading project to use the new national consenting process, and the board of inquiry took just over 9 months to reach a final decision. During this process, local concerns have been heard and mitigation measures included, such as moving the location of the vent stacks and providing additional open space. Now that the consent and the mitigation measures have been finalised, I understand that the New Zealand Transport Agency will be in a position to appoint a lead contractor, with construction starting later this year. This quick progress has saved up to a year in construction time, as well as offering significant cost savings.

David Shearer: Given that the Waterview Connection generates benefits of up to $2 for every $1 spent on its construction, will the Minister now review plans for the “Holiday Highway” north of Auckland, which will deliver only 80c for every $1 spent on its construction, particularly in light of rebuilding demands in Christchurch?

Hon STEVEN JOYCE: The member’s numbers are incorrect. I think that project has a 1.1 benefit-cost ratio at 8 percent, and better at 6 percent. Certainly the Puhoi to Wellsford road is acknowledged as crucial for the development of the whole Northland region. Of course, if the member wants to play benefit-cost ratios, I look forward to his view on the central business district rail tunnel, which currently has a benefit-cost ratio on the same measurement of 0.3 or 0.4.

New Zealand Trade and Enterprise—China Beachheads Advisory Board

8. Hon DAVID PARKER (Labour) to the Acting Minister for Economic Development: Did the New Zealand Trade and Enterprise Beachheads advisory board in China resign en masse the week before last; if so, for what reasons?

Hon DAVID CARTER (Acting Minister for Economic Development): Yes; differences of opinion developed over quite a period of time between the Beachheads advisory board and New Zealand Trade and Enterprise, and it was agreed that the best way forward was to start with a clean slate.

Hon David Parker: Did the Minister read the prior warnings in newspaper or other reports quoting David Mahon, the then chair of the Beachheads board, criticising New Zealand’s failure to pursue opportunities under the free-trade agreement with China, in which he said “Trade agreements that are not followed by integrated, commercial strategies are the most empty of political marriages. New Zealand’s free trade agreement, signed with China in 2008, is one such unconsummated marriage.”?

Hon DAVID CARTER: I did read those comments, and I certainly do not agree with them.

Hon David Parker: Why should New Zealanders have any confidence in the Government’s handling of trade and investment opportunities with China, given that the mass resignation of the private sector participants in the Beachheads programme for China is a vote of no confidence by those most closely involved?

Hon DAVID CARTER: I am quite happy to tell the member why we should have confidence in the work of New Zealand exporters and of New Zealand Trade and Enterprise. China has become New Zealand’s second-largest trading partner since 2008. We have observed a 140 percent increase in the amount of trade with that country. That is the fastest rate of growth in the history of New Zealand and of New Zealand Trade and Enterprise.

Hon David Parker: Does the Minister intend to replace the private sector Beachheads board, or is this just another area where the Government has no adequate plan to support the growth of the New Zealand economy?

Hon DAVID CARTER: The Beachheads programme is but one suite of mechanisms used by New Zealand Trade and Enterprise. It is absolutely an operational matter as to how the advisory board’s relationship with New Zealand Trade and Enterprise is managed, and it is over to New Zealand Trade and Enterprise to decide whether to replace the board. The figures speak for themselves. When we can talk about a 140 percent increase in trade over 3 years, for the member to suggest that New Zealand is not trading satisfactorily with China is just a plain nonsense.

Hon Maryan Street: What damage has been done to New Zealand’s reputation with our secondlargest trading partner by the complete collapse of this well-known and defective Beachheads board in the wake of the Government’s intervention?

Hon DAVID CARTER: I do not believe any damage has been done, which will be a disappointment to the Labour Party.

Hon Maryan Street: What does the Minister intend to do to restore any damage to New Zealand’s reputation in China after this very patent debacle?

Hon DAVID CARTER: I do not believe any damage has been done to the New Zealand reputation in China at all. What the member needs to realise is that the Beachheads programme dealt with 12 New Zealand companies working in China; New Zealand Trade and Enterprise works with 183 companies quite successfully, as the trade figures demonstrate.

Children, State Care—Home for Life Numbers

9. TIM MACINDOE (National—Hamilton West) to the Minister for Social Development and Employment: How many foster children now have a “Home for Life”?

Hon PAULA BENNETT (Minister for Social Development and Employment): Since I launched the Home for Life programme in October last year, a total of 329 children have found permanent, stable homes with New Zealand families. In fact, permanency is the best thing we can give those children.

Tim Macindoe: What support is available for families under the Home for Life programme?

Hon PAULA BENNETT: Every caregiver who offers a child a home for life is entitled to reasonable legal costs; a $2,500 upfront payment, paid after the Home for Life orders are granted; a baby starter pack for children under 2; and access to a national foster care training programme. They get to determine how much a social worker is involved in their lives and in their family, and I think that has been really well received.

Rahui Katene: What responsibility does the Government take to ensure that kin care, families, and whanau with a direct genealogical link to the child are promoted as the first option in any care arrangements concerning children?

Hon PAULA BENNETT: Child, Youth and Family takes the responsibility to try to find suitable family and whanau first and utmost as its main priority for these children. As at the end of June, 75 percent of those homes were with family or whanau—that is, 248 children since October. For Maori that figure is even higher, with 85 percent going into permanent placements with whanau.

Housing—Access to Appropriate and Affordable Housing

10. MOANA MACKEY (Labour) to the Minister of Housing: Does he believe all New Zealanders should have access to appropriate and affordable housing?

Hon PHIL HEATLEY (Minister of Housing): Yes, and the overwhelming majority of New Zealanders are able to source and sustain their own housing arrangements. For those who need additional support, we are committed to helping them. Budget 2011 contained $1.85 billion for 350,000 households who are provided with the income-related rent subsidy in State houses or the accommodation supplement for those in private rentals and those with mortgages. This is an increase of $444 million, or 32 percent, above the Labour Government’s 2008 Budget. Moana Mackey: Is he confident that there is enough appropriate and affordable accommodation available for the 5,000 people who have been told they are no longer eligible for a Housing New Zealand Corporation home, and for the many thousands more who will have their tenancies terminated if National wins the election?

Hon PHIL HEATLEY: All people who were on the waiting list, from A through to D, on 1 July are still eligible for a State house—we gave them that certainty. It is those who come on to the housing needs register from 1 July and who are C and D applicants who will not be eligible for a State house. I think the member should get her facts right before promoting such scaremongering.

Moana Mackey: Why is he taking a one-size-fits-all, punitive approach that will achieve nothing other than cause major uncertainty for every family in State housing, instead of letting Housing New Zealand Corporation continue to work with tenants on a case by case basis and move people on when appropriate, given that the actual problem is a lack of affordable housing options and not fictitious millionaire Housing New Zealand Corporation tenants?

Hon PHIL HEATLEY: The problem is that historically no Government has moved anyone on from State houses. That is why we have cases where one person is living in a four-bedroom house, where five or six people in a family are living in a garage—particularly during the previous Labour Government—and where some people in State houses earn $80,000, $90,000, or $100,000 a year while others struggle on the waiting list. We will address that problem. We will be housing the people most in need.

Moana Mackey: When will his Government reveal any kind of plan to deal with the actual reasons that families cannot access appropriate and affordable housing, which are a stagnant economy, rising unemployment, massive cost of living increases, and a desperate ever-worsening shortage of housing supply, which has driven up rents in the private sector, instead of scapegoating poor and struggling families and blaming them for the fact that they cannot find somewhere to live?

Hon PHIL HEATLEY: I have publicly and clearly laid out National’s plan in housing. I have not heard a thing from the Labour Party. Where is its plan?

Arts Funding, New Plymouth—Len Lye Centre

11. JONATHAN YOUNG (National—New Plymouth) to the Minister for Arts, Culture and Heritage: What recent announcements has the Government made about supporting the arts in New Plymouth?

Hon CHRISTOPHER FINLAYSON (Minister for Arts, Culture and Heritage): I recently announced a grant of $4 million over 2 years toward the construction of a Len Lye Centre to be built adjacent to the Govett-Brewster Art Gallery. It will provide a permanent and accessible home for the Len Lye collection and archive, which the Govett-Brewster Art Gallery has held since 1980. It will make the works of one of our most important artists accessible all year round to New Zealanders and foreign visitors. I acknowledge the outstanding work of New Plymouth MP Jonathan Young in advocating for the city’s interests.

Jonathan Young: How will the grant support the people and community of New Plymouth?

Hon CHRISTOPHER FINLAYSON: The centre’s design, by award-winning firm Pattersons, will provide the city with new built heritage to further enhance it as a tourism destination.

Hon Annette King: Marginal seat retention scheme.

Hon CHRISTOPHER FINLAYSON: Well, Harry was very happy. An independent study projected that the economic benefits to New Plymouth will be an extra $6.8 million a year and the creation of the equivalent of 138 full-time jobs. It is a fantastic development, and it may perhaps provide an incentive for Andrew Little to spend a few nights in New Plymouth one day. Question No. 12 to Minister

Hon TREVOR MALLARD (Labour—Hutt South): I seek leave for this question to be set down for tomorrow as the Prime Minister has clearly stepped out. The Prime Minister was here, and it is a question on employment—

Mr SPEAKER: Leave is sought—

Hon TREVOR MALLARD: —which we regard as very important.

Mr SPEAKER: The member should not have added that bit. He is seeking leave to have this question deferred. Is there any objection to that? There is objection.

Job Creation—Prime Minister’s Statement

12. JACINDA ARDERN (Labour) to the Prime Minister: Does he stand by his statement that “Our strategy for job creation is to build the economic conditions that will give businesses the confidence they need to hire new workers”?

Hon BILL ENGLISH (Deputy Prime Minister) on behalf of the Prime Minister: Yes. Jacinda Ardern: Does he believe that his Government is doing everything it can to create and keep Kiwi jobs when last month 40 workers at Hillside railway workshops were told they were being laid off because KiwiRail chose a Chinese bidder for a significant contract?

Hon BILL ENGLISH: We are certainly endeavouring to do everything we can. To put that particular business in perspective, in the average 3-month period something like 120,000 jobs disappear and about 130,000 jobs appear, so there is a very high turnover in the New Zealand labour market. We want to make sure, in particular, that people enter the labour market with good skills out of the education system, and that businesses can see that it will be profitable for them to employ more people in New Zealand. The good news is that confidence is rising and employment is rising. Jacinda Ardern: Is he confident his Budget’s job creation policies are working, given that since 19 May over 1,000 New Zealand workers have been made redundant and a record 3,300 Kiwis have left for Australia and better opportunities?

Hon BILL ENGLISH: We do have confidence in the measures laid out in the Budget. The Budget forecasts, for the next 4 years, 170,000 new jobs, which will be a return to the rate of job creation that this economy enjoyed from 1990 to 2005, when about 35,000 new jobs, on average, were created every year.

Jacinda Ardern: What role did economic conditions play in the loss of 304 jobs at Ovation New Zealand’s boning facility in Waipukurau, and are these the same economic conditions that he believes will create 170,000 jobs?


Hon BILL ENGLISH: Regardless of the economic cycle, industries go through change. The sheep industry has gone through a fairly significant contraction, and around that industry we would expect that because of reduced lamb numbers there will be reduced processing capacity. Our challenge is to make sure that for those skilled workers there are good opportunities, in growing industries, for them to pick up jobs where they can get good pay and a prospect that their incomes will increase. So we are focusing on helping create the new jobs.

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