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Questions And Answers Feb 16

(uncorrected transcript—subject to correction and further editing)




Question No. 1 to Minister

Rt Hon WINSTON PETERS (Leader—NZ First): I seek leave to have this question moved down to below question No. 12 so that the Prime Minister will have a chance to answer it.

Mr SPEAKER: Leave is sought to have question No. 1 relocated to below question No. 12. Is there any objection to that course of action? There is objection.

Overseas Investment Rules—Judicial Decision on Sale of Crafar Farms

1. Rt Hon WINSTON PETERS (Leader—NZ First) to the Prime Minister: Has he had time to read and digest the judgement of Justice Miller regarding the Crafar farm deal; if so, does he stand by his comments made in the House yesterday?

Hon GERRY BROWNLEE (Leader of the House) on behalf of the Prime Minister: He has read the judgment and he stands by his comments.

Rt Hon Winston Peters: To which law was the Prime Minister referring when he claimed in the House yesterday that the law—and to use his words—“does not allow Ministers to reverse OIO advice”?

Hon GERRY BROWNLEE: I think what the Prime Minister was referring to was the requirement that all Ministers act within the law, and that the expectation that the advice coming from the Overseas Investment Office would, in fact, be within the law.

Rt Hon Winston Peters: That was worse than yesterday.

Mr SPEAKER: Order!

Rt Hon Winston Peters: Why did the Prime Minister yesterday argue that the Ministers Jonathan Coleman and Maurice Williamson should rely on the same view as the Overseas Investment Office?

Hon GERRY BROWNLEE: The expectation of all Ministers is that they should be able to rely on the advice of their officials. In relying on that advice, they come to their own conclusion, within the law.

Rt Hon Winston Peters: Do the two Ministers not have their own officials? That being case, what scrutiny independent of the Overseas Investment Office—

Hon Christopher Finlayson: Stupid question.

Rt Hon Winston Peters: Well, I will say it again very slowly for the so-called learned gentleman down there—

Mr SPEAKER: Order!

Rt Hon Winston Peters: But you heard what he said.

Mr SPEAKER: Order! I am on my feet, and that will be the end of any further interjection. I get to my feet to stop this childish backwards and forwards across the House. I say to the honourable gentleman on my right that such interjections do not exactly help with good order in the House.

Rt Hon Winston Peters: What scrutiny independent of the Overseas Investment Office did his Ministers apply to the Overseas Investment Office report on the Crafar purchase?

Hon GERRY BROWNLEE: The Prime Minister would expect all Ministers to exercise their judgment based on the advice that is put in front of them. It is patently obvious that all those decisions are reviewable. That is why we are in this situation now.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. We are not going to get anywhere if we are going to get that sort of answer. I asked whether the two Ministers concerned had got independent advice, independent of the Overseas Investment Office. That is what I want to know.

Mr SPEAKER: In the circumstances I will allow the Rt Hon Winston Peters to repeat the question he asked, to make sure everyone understands exactly what it is.

Rt Hon Winston Peters: What scrutiny independent of the Overseas Investment Office did his Ministers apply to the Overseas Investment Office report on the Crafar purchase?

Hon GERRY BROWNLEE: I doubt that is the first question word for word. However, what I would say again is that the Prime Minister expects all Ministers to exercise their judgment based on the information that is provided to them by their officials. Their officials, in many cases, are not aligned to the Overseas Investment Office.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. I got the Prime Minister’s answer, but the question asked of him was did they receive, or did they seek, any advice independent of the Overseas Investment Office. That is pretty simple.

Mr SPEAKER: The member is correct; his question did exactly ask that. In his answer the Minister referred to advice from the officials. Although he did not specifically say the Ministers received advice from their own, independent officials, I picked up that from his answer. But if I am wrong there, he had better correct me. It seems that that is what the Minister intended.

Hon David Parker: Did the legal test always require the benefits from overseas ownership to be substantial and identifiable?

Hon GERRY BROWNLEE: What I understand is that is the case, but it is the way in which that conclusion was reached that is the contention, and, ultimately, the judgment that has come down. So instead of that test—better before or after—it is now with or without. It is a fine technical point. The judge makes that clear. He has also invited Ministers to reconsider it on that basis, which they will do.

Rt Hon Winston Peters: Why did the Prime Minister ignore section 17 of the Overseas Investment Act in response to a question in the House yesterday asking how he had arrived at the view that his two Ministers, to use his words, had no discretion at all?

Hon GERRY BROWNLEE: Well, the first point is the Prime Minister has no responsibility in this case directly, and he was correct in saying that his Ministers were appropriately following advice given to them by their officials, assessed and judged by themselves. The point is that the decision, in any event, has been reviewed by the court, and the court has made a recommendation about a reconsideration, and that will take place.

Hon David Parker: Is the reality not that the court did what his Minister failed to do: it applied the economic benefit test and found no identifiable evidence that the overseas buyer would produce any substantial benefit to New Zealand?

Hon GERRY BROWNLEE: The test applied by the Overseas Investment Office was the same test that they used to advise a former Minister, the Hon David Parker, in his decisions on these matters. The question is should the test be applied on a before or and after basis, or on a with or without basis? The court has ordered it is with or without, and has invited Ministers to reconsider, and that is what they will do.

Dr Russel Norman: How were the Ministers able to exercise their judgment in this case, while at the same time following the Prime Minister’s direction that they had no discretion?

Hon GERRY BROWNLEE: I think the point is that all of these decisions are reviewable, and, on the evidence put in front of the Ministers, it was patently clear, using the before or after test, which has now been decided is inappropriate, they had—[Interruption] It was decided that, on the before or after test, asking the questions that are required through the four points inside that particular part of the more than 20 points that have to be considered in the test, they had exercised their judgment appropriately.

Rt Hon Winston Peters: Can I ask the Prime Minister as to why the public should not assume that the two Ministers in question took the view that the Prime Minister keeps on defending, which is that they had no discretion at all, and therefore applied no independent thought or judgment at all, and just rubber-stamped the Crafar deal?

Hon GERRY BROWNLEE: The Ministers have acted totally appropriately. They were entitled to believe that the advice they had got from their officials was consistent with the advice that had been offered over the previous 7 years. For a large number of those years the member himself was supporting the Government in those decisions. It was never a problem when he was supporting the Government; apparently, it is now.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. He cannot go on to a personal attack of me when it is well known that he and others got rid of New Zealand First and Winston Peters because we were stopping their—

Mr SPEAKER: Order! The right honourable member knows that is not a point of order, under any guise whatsoever. It was successful, though, in stopping the Minister’s answer. I presume the Minister, therefore, has finished his answer. Yes, he has finished his answer.

Dr Russel Norman: Does the Prime Minister have any other concerns about the way the Overseas Investment Office is carrying out its functions, in light of comments this morning from the director of the Overseas Investment Office that in applying the economic benefit test they never take any account of the economic downside or economic detriment that might result from foreign investment, such as an increase in the current account deficit?

Hon GERRY BROWNLEE: No. They have applied the law appropriately for 7 years, and have got to a point where one small aspect of the tests that were put in place all those 7 years ago does need to be reconsidered in a different light—so going from before and after to with or without. I would ask why it is that after, you know, 7 years of this Act being operative, suddenly those who were party to passing it are so very concerned—

Mr SPEAKER: Order! That is sufficient.

Dr Russel Norman: Does the Prime Minister now accept that those of us who have opposed the operation of this system all along, such as the Green Party, have been absolutely correct to oppose it, because the Overseas Investment Office has been incorrectly applying the test, as Justice Miller pointed out in the judicial review?

Hon GERRY BROWNLEE: Justice Miller has made that point, and Ministers will act within that judgment for any future applications and for the reconsideration of this application. Other than that, the Overseas Investment Office has operated inside the bounds that were prescribed in the law by a previous Government.

Overseas Investment Rules—Sale of Crafar Farms

2. Hon DAVID PARKER (Labour) to the Minister for Land Information: Does he believe he and the Government have conducted themselves competently and appropriately in relation to the decision to approve the purchase of the Crafar farms by a foreign buyer; if not, what did they do wrong?

Hon MAURICE WILLIAMSON (Minister for Land Information): Yes.

Hon David Parker: Why did the Minister say on several occasions that he had to approve the sale of the Crafar farms to Shanghai Pengxin under the New Zealand - China free-trade agreement, when the High Court found that the Overseas Investment Office’s written advice to him was the opposite?

Hon MAURICE WILLIAMSON: Because, as I think the Hon Gerry Brownlee told the House a few minutes ago, for 7 years under both a Labour and a National Government the before and after economic benefit test was the test that the Overseas Investment Office used—on the James Cameron application or the Shania Twain application or any of the others that have gone through it.

Hon David Parker: I raise a point of order, Mr Speaker. Very interesting, but my question was why he used the cover of the Chinese free-trade agreement—

Mr SPEAKER: The member may repeat his question.

Hon David Parker: Why did the Minister on several occasions say that he had to approve the sale of the Crafar farms to Shanghai Pengxin under the New Zealand - China free-trade agreement, when the High Court found that the Overseas Investment Office’s written advice to him was the opposite?

Hon MAURICE WILLIAMSON: Because we were applying the test we believed to be appropriate—the one that had been used. The fact is that Ministers’ decisions are subject to judicial review, just like the Hon Chris Carter lost in the courts over the Whangamata waterways, and—

Hon David Parker: I raise a point of order, Mr Speaker. The Minister has still not addressed the issue—

Mr SPEAKER: I hear what the member’s concern is. The question specifically asked why the Minister had said, allegedly on more than one occasion, that he had to approve the deal because of the New Zealand - China free-trade agreement, which has nothing to do with the previous practice under the Overseas Investment Office, because the New Zealand - China free-trade agreement is relatively recent. That is the bit, I think, because the question covered only that issue.

Hon MAURICE WILLIAMSON: I can be helpful.

Mr SPEAKER: If the Minister can be helpful, I will be very—[Interruption] Order! If the Minister can be helpful to the House, that is great.

Hon MAURICE WILLIAMSON: I said in the House in question time on Tuesday that this application and its processes went through, regardless of whether we had a free-trade agreement with China or not.

Hon David Parker: Why did it take 9 months from the time of Shanghai Pengxin’s application to his erroneous decision? Was it because it took that long for the Government to stitch up a deal involving Landcorp?

Hon MAURICE WILLIAMSON: It took that long because the Overseas Investment Office wanted to get all of the relevant information it needed, and it went back to the applicants on a number of occasions to further get that information. I am pleased that the office took the right amount of time, and did not try to rush it.

Hon David Parker: Can the Minister give an assurance to the House that at no stage did any Minister of the Government or any official from the Overseas Investment Office tell any party that they were delaying their decisions until after the election?

Hon MAURICE WILLIAMSON: Well, that is not what happened, and I most certainly did not say that; I do not think I can speak for every other human being there is.

Rt Hon Winston Peters: Supplementary question, Mr Speaker—

Mr SPEAKER: What has happened here is that I have just been told by the Hon Trevor Mallard that the Labour Party is giving a further supplementary question to the Rt Hon Winston Peters. These are meant to be advised to the Speaker prior to the start of question time. However— [Interruption] Order! I do not want to be difficult, but I just ask members in the future, please, to make sure that the Speaker is advised of these things a little more in advance than at the moment that members get to their feet.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. I apologise for the late notice. It will be obvious to everyone that the answers are the reason for—

Mr SPEAKER: Order! That is not an acceptable point of order either. It was barely much better than the one we heard not so long ago. It was just being used to criticise another member of this House, and that is not allowed under the point of order process.

Rt Hon Winston Peters: I apologise, Mr Speaker. I will get you notice, next time, much earlier, but it was the nature of the question. I want to ask the Minister this: if he is explaining the proper due diligence done by the Overseas Investment Office on the issues he talks about as taking 9 months, why then did it take over 12 months for the same office to determine that May Wang and Jack Chen were of good character, when one phone call to the Shanghai or Hong Kong stock exchange would have told them otherwise?

Hon MAURICE WILLIAMSON: I do not know whether I can ever comment on the process that the Overseas Investment Office goes through. It took its time to make a determination about the bid. And in the case of Natural Dairy—the member will be pleased—the Overseas Investment Office recommended that the Government not approve it.


3. JONATHAN YOUNG (National—New Plymouth) to the Minister of Finance: What reports has the Government issued on the economy?

Hon STEVEN JOYCE (Associate Minister of Finance) on behalf of the Minister of Finance: The Government has today issued the Budget Policy Statement for 2012. It confirms the Government’s clear and comprehensive economic plan for the next 3 years, which will make our economy more competitive so it can fulfil its potential. Within this plan the Government has set out four main priorities to help achieve this. They are to continue to responsibly manage the Government’s finances by returning to surplus and keeping debt under control; to continue to implement economic policies that build a more competitive, export-focused economy; to deliver better public services to New Zealanders within a tight fiscal Budget; and to rebuild our secondbiggest city, Christchurch.

Jonathan Young: How will the Government’s economic plan be reflected in Budget 2012?

Hon STEVEN JOYCE: As the Budget Policy Statement says, Budget 2012 will be, first and foremost, about sticking to the Government’s economic plan. It is important that we do that to build a stronger, more competitive economy that supports more sustainable jobs and higher incomes, and ensures that New Zealand starts to pay its way in the world. Indeed, the Government’s Budget priorities throughout this parliamentary term will be about sticking to that plan.

Jonathan Young: What does the Budget Policy Statement say about the outlook for the New Zealand economy?

Hon STEVEN JOYCE: The Budget Policy Statement sets out some updated forecasts from Treasury. They show that New Zealand’s economic outlook, although somewhat weaker than forecast in the pre-election update in October, remains positive. Our terms of trade are expected to remain high. Our largest trading partners, particularly China and Australia, are among the strongerperforming countries in the world. And the rebuilding of Christchurch will provide impetus to the economy in coming years. However, there is a risk that events offshore, particularly in Europe, could have a negative impact on the New Zealand economy. The Government continues to monitor those events closely.

Hon David Parker: Does the Budget Policy Statement show a rising current account deficit, as well as higher Government debt and lower growth in the coming years than were promised by National during the election?

Hon STEVEN JOYCE: The Budget Policy Statement does show a worsening economic situation, which has a negative impact on the balance of payments and one or two of the other matters the member raises. And that has effectively caused, as stated in the Budget Policy

Statement, a delay to the Canterbury rebuild, brought about by the additional seismic activity and also the more troubling clouds in Europe in the economies over there. So those things all have an impact on the predictions in this particular statement.

Jonathan Young: And how is the latest economic outlook expected to impact on the Government’s finances?

Hon STEVEN JOYCE: The Budget Policy Statement forecasts show that the Government remains on track to post a $370 million surplus in 2014-15, to keep net debt below 30 percent of GDP, and to reduce this to 20 percent of GDP by 2020-21. Given the events in Europe and the weakened outlook for global growth, this forecast is understandably smaller than was forecast in the pre-election update, but the Government does remain on its fiscal track to surplus. It will, however, require disciplined control of spending and tight management of our capital allocations. For example, we have conferred net zero capital allowances for each of the next five Budgets, requiring new investments to be funded from capital freed up from the balance sheet rather than by additional borrowing.

Work and Income—Case Management Approach

4. JACINDA ARDERN (Labour) to the Minister for Social Development: Does she have confidence that Work and Income meets their own “case management approach” expectations?

Hon CHESTER BORROWS (Associate Minister of Social Development) on behalf of the

Minister for Social Development: Yes. Work and Income deals with 147 million transactions a year. That is 2.8 million transactions a week and 403,000 transactions a day. The Minister believes Work and Income staff work very hard and she backs them.

Jacinda Ardern: Does she believe the level of support a sole parent on the domestic purposes benefit can access in order to move into work or education is sufficient?

Hon CHESTER BORROWS: Yes; there are a number of benefits and assistance packages that women on the domestic purposes benefit, or anyone on the domestic purposes benefit, can access in order to get into education. It depends on which level of education they wish to access as to how those benefits will be applied. But they are available, for instance, for university study in the form of student loans and allowances; for lower-level qualifications—levels 1, 2, and 3—that they are seeking, they can still receive the training incentive allowance.

Jacinda Ardern: How much can someone on the domestic purposes benefit who wants to move into education, and who has one dependent child and no income, receive per hour per child to assist with childcare?

Hon CHESTER BORROWS: It is a very precise question, given the primary question, but as I understand it a person on the domestic purposes benefit with one child is able to receive the normal domestic purposes benefit. She may well be entitled to accommodation supplements on top of that. She is also entitled to early childhood education and childcare allowances on top of that. She is able to receive student loans in respect of meeting the fees for each paper, and also a $1,000 grant for course-related costs.

Jacinda Ardern: I seek leave to table the details of the childcare subsidy, which states that the mother shall be—

Mr SPEAKER: Order! Before we go into that, what is the source of this document?

Jacinda Ardern: It is available publicly, but given the Minister was unable to answer the specific question—

Mr SPEAKER: Order! That was just grandstanding; we do not do that under a point of order. Silly me! Let me reword that. We should not do that under a point of order.

Jacinda Ardern: What is the difference in support a solo mum with one dependent child and no income will be eligible for if she wishes to study and approaches StudyLink versus if that same solo mother went to Work and Income, and why is there such a difference?

Mr SPEAKER: I call the Hon Chester Borrows, in so far as he is able to give an answer, in the breadth of the primary question.

Hon CHESTER BORROWS: I would draw attention to the breadth of this question away from the primary question, which related to expectations of people approaching a case manager at Work and Income.

Jacinda Ardern: I raise a point of order, Mr Speaker. The original question obviously relates to an issue of the day, where Work and Income have given inadequate advice to a domestic purposes benefit mum, and part of that was her getting very different advice from both StudyLink and Work and Income. So all of this does relate to the adequacy of the advice that Work and Income staff—

Mr SPEAKER: Order! My advice to the member is if she wants Ministers to have that kind of detail available to answer questions, make the primary question more clear. With all respect, this primary question is very broad and it is not reasonable to expect the Minister could have that level of detail, given that primary question.

Jacinda Ardern: To what does she attribute our status as having one of the highest rates of unemployment for sole parents in the OECD, next to Turkey and Malta: a lack of willingness to work, as her welfare reform package implies, or the barriers to work, as the reality suggests?

Hon CHESTER BORROWS: The finding of New Zealand’s provision of services to people wishing to study who are in receipt of a domestic purposes benefit, in respect of other OECD countries, was not made by the Minister but in fact by an independent organisation. It is interesting to note that there is lots of assistance available to sole parents. Even without the training incentive allowance, there is extensive support available for domestic purposes benefit recipients studying at tertiary level, including interest-free student loans, student allowances, childcare subsidies, the accommodation supplement, out-of-school care and recreation subsidies, 20 hours’ free early childhood education, temporary additional support, special-needs grants, and so on, and these are not available in many other countries.

Benefits—Effect of Training Incentive Allowance Changes

5. JAN LOGIE (Green) to the Minister for Social Development: Does she have concerns that changes to the eligibility for the Training Incentive Allowance are causing single parent beneficiaries to consider working in the sex industry?

Hon CHESTER BORROWS (Associate Minister of Social Development) on behalf of the

Minister for Social Development: No.

Jan Logie: Does she think it is fair that single-parent beneficiary Tania Wysocki is reluctantly considering sex work to cover the cost of travel and childcare associated with her high-level veterinary nursing degree, whereas these costs would be covered by the training incentive allowance were she studying for a lower-level course?

Hon CHESTER BORROWS: I find it very difficult to accept that somebody is forced into prostitution in order to study. People may have to choose between earning an income through work, and studying. There are no easy options for a solo parent, but there is considerable support available, as outlined in answer to the previous question.

Jan Logie: Does she accept that the childcare subsidy offered to Tania Wysocki does not cover the full costs of childcare, whereas the training incentive allowance would meet the additional costs beyond the subsidy?

Hon CHESTER BORROWS: Ms Wysocki was quoted in an article from the New Zealand Herald, and the subsidies available to Ms Wysocki are not those quoted in the New Zealand Herald. The reporter was given an indication of those subsidies orally; he chose not to write them. It is important to note that Ms Wysocki receives the equivalent of a salary of $43,000 a year plus her entitlement to 20 hours’ early childhood education. I think most New Zealanders would find that an equivalent salary of $43,000 is sufficient, or at least reasonable.

Jan Logie: Does it concern her that it took a visit with Tania’s local MP, Paul Hutchison; a letter to John Key; unanswered correspondence with the Minister’s own office; multiple conversations with Work and Income; and, finally, media attention for Tania to receive her full benefit entitlements, and that even then this offer of assistance is not enough to keep her from considering sex work as a way to make ends meet while studying?

Hon CHESTER BORROWS: I refer to my answer to the previous supplementary question as to the level of assistance Ms Wysocki is getting. I also need to indicate that a Work and Income employee, in giving out advice as to what level of assistance an applicant can be given, is constrained by the information given by that applicant. We understand that once the full details were known as to the hours of study that she needed to do, her ability to obtain childcare was raised from the 9 hours originally offered.

Jan Logie: Do you accept—

Mr SPEAKER: Order! No, no, questions do not ask “do you accept”; they—

Jan Logie: Oh, OK—sorry. [Interruption] No, I am just—[Interruption]

Mr SPEAKER: Order! Be reasonable.

Jan Logie: Does the Minister accept that Tania is financially worse off studying without receiving the training incentive allowance?

Hon CHESTER BORROWS: The training incentive allowance has been redirected to those people most in need. What we do know is that half the women on the domestic purposes benefit have not achieved a level of education of National Certificate of Educational Achievement level 1 or foundation course skills. So we have redirected the training incentive allowance to those people to get the best results for the investment of the taxpayer’s money.

Jan Logie: I raise a point of order, Mr Speaker. It was a direct question: is she financially worse off without receiving the training incentive allowance—a yes or no question. [Interruption]

Mr SPEAKER: Order, I say to members! Please, I am on my feet. If I heard correctly, the member asked whether or not the Minister believed the person in question was worse off without the training incentive allowance. That is seeking an opinion. But it would be helpful if the Minister did refer to the difference between someone in her position having, in theory, a training incentive allowance and not having a training incentive allowance, rather than giving the reasons why. The Minister is giving the reasons why the Government chose, it seemed to me, to redirect the training incentive allowance; that was not what the question asked. It is seeking an opinion, there is no precise answer, and we will not insist on yes or no. But it would be helpful if the answer did refer to the question asked, which is to do with whether the person is better off or not. It was even hypothetical—whether they would be better off or not with the training incentive allowance. Some reference to that would be helpful.

Jan Logie: I raise a point of order, Mr Speaker. Just to clarify that my wording was “to accept”, and I do think there is a differentiation between “believe” and “accept”—and it is around a point of fact.

Mr SPEAKER: I apologise. But it is still seeking an opinion. The member asked whether the member accepts that someone is worse off. That is not what she said when she repeated her question. When she repeated her question she said: “Is such-and-such worse off?”, whereas she acknowledges now that her original question was: “Does the Minister accept …” and that is seeking an opinion. But it would be helpful if the opinion did bear some relationship to the question asked.

Hon CHESTER BORROWS: The Minister does not accept that this particular applicant is worse off under the new rules in respect of the training incentive allowance. The Minister believes that the Government assistance she receives and the assistance she could apply for leave her in a very healthy position in terms of extending her own education.

District Health Boards—Results of Collaboration

6. Dr CAM CALDER (National) to the Minister of Health: What improvements have there been to services for patients as a result of greater collaboration between District Health Boards?

Hon TONY RYALL (Minister of Health): The Hutt Valley District Health Board and the Capital and Coast District Health Board have been working together to provide faster access to magnetic resonance imaging for their patients. In March last year, I am told, there were 760 patients waiting longer than 6 months to have routine magnetic resonance imaging at Wellington Regional Hospital. That waiting list has now been completely cleared and no one is waiting longer than 4 months. More scans are now being done at the Hutt Hospital and an after-hours radiology registrar has been provided there instead of relying for services from Australia. This is a very good example of what can be achieved when neighbouring district health boards work together.

Dr Cam Calder: What improvement has there been to waiting times for ultrasounds in Wairarapa?

Hon TONY RYALL: The Hutt Valley District Health Board and the Wairarapa District Health Board have worked together to reduce the waiting time for ultrasounds from 9 months last year to less than 2 months today. Additional clinics provided at Hutt Hospital have cleared the backlog, and now a sonographer is travelling from the Hutt Valley to Masterton for a clinic 1 day per week. This more efficient service sees fewer cancellations, less rebooking, and more certainty for patients, and is a very good example of district health boards working together to provide faster services for patients.

State-owned Assets, Sales—Government Policy

7. Hon CLAYTON COSGROVE (Labour) to the Minister for State Owned Enterprises: Does he still intend to sell 49 per cent of the four State-owned energy companies?

Hon TONY RYALL (Minister for State Owned Enterprises): The Government’s position has always been that it would sell up to 49 percent of the companies and so would retain at least 51 percent ownership. The Government’s intentions remain subject to market conditions.

Hon Clayton Cosgrove: Will the Minister now give an absolute guarantee to New Zealanders that the Crown’s stake in the four State-owned energy companies up for sale will never fall below 51 percent?

Hon TONY RYALL: I think we can give more than the guarantee of the Minister. That is the intention of the legislation that the Government intends to introduce—to give an assurance that the Crown’s ownership will not fall below 51 percent.

Hon Clayton Cosgrove: In light of that answer, could he outline whether, in the event of the companies needing more capital, the Government would borrow and/or use additional taxpayers’ funds to ensure that the Crown’s stake never falls below 51 percent?

Hon TONY RYALL: That would be the Government’s intention: if there was additional capital required for the company and it made sense for that capital to be raised, the Government would bring forward its contribution.

Hon Clayton Cosgrove: If the revenue from the asset sales is less than the Government’s estimated $6 billion, which its stated intention is to use for the so-called Future Investment Fund to offset debt, will the Government be forced to borrow additional funds to make up that difference?

Hon TONY RYALL: The member is asking whether if the sales proceeds do not reach $6 billion, we would borrow money in order to make up the difference to pay back the money and the debt that we are trying to reduce? No, the Government is expecting, and has been working within, a range of $5 billion to $7 billion resulting from the asset sales.

Hon Clayton Cosgrove: Why has the Government only now woken up to the fact, via Mr English’s comments in the media in the last 24 hours, that there is a high risk of its 51 percent controlling interest being diluted, when a Treasury report entitled Extending the Mixed Ownership Model, dated 4 March 2011, warned that if the Government wants to keep its majority stake then

“any further raisings will require Government participation to avoid dilution”? Does that not fly in the face of the Prime Minister’s comments that the reason for the asset sale float was because the Government could not afford to put in extra capital in?

Hon TONY RYALL: There is nothing new in this point. I was in a select committee and Mr Norman from the Green Party asked me that question, I think, in the middle of last year.

Local Authorities—Rates Increases Since 2002

8. JAMI-LEE ROSS (National—Botany) to the Minister of Local Government: What analysis has he received on rate increases across New Zealand’s 78 councils following the enactment of new local government legislation in 2002?

Hon Dr NICK SMITH (Minister of Local Government): The analysis shows that the national rates bill has increased quite dramatically, from $2.3 billion a year to $4.2 billion a year, or by 7 percent compound per annum. Inflation over these years has increased 3 percent per annum. The increases range from as high as 13 percent compounded per year for some councils, to the lowest of 4 percent compounded per year for others. None of the councils were able to keep the increase over that decade to the rate of inflation. The fact that these rate rises dramatically increased under the enactment of the new local government legislation in 2002 raises questions about the negative impacts these reforms have had for both households and businesses.

Jami-Lee Ross: Has the Minister seen any reports from 2002 where the Government assured businesses, farmers, and householders that the changes to the purposes and principles of local government would have no impact on rates or costs, and given what has transpired since, what economic impacts have these changes had?

Hon TONY RYALL: Yes, I have seen reports. Strong assurances were given by the previous Government, in fact, that there would be big cost savings from those changes in 2002. The fact is that the average rate rise in the decade since has been 6.8 percent, as compared with the decade previous of 3.9 percent per annum. If the rate increase had continued at the previous rate, rates would be costing the New Zealand economy today $1 billion a year less, or a saving of $500 per household. As a consequence of these figures, the Government is reviewing those 2002 changes, because ongoing cost increases of this order are not affordable and will negatively impact on New Zealand’s economic prospects.

Earthquakes, Canterbury and Christchurch—Extension of Red Zone Offer to Retirement


9. Hon LIANNE DALZIEL (Labour—Christchurch East) to the Minister for Canterbury

Earthquake Recovery: Does he stand by the part of his statement of 27 January, announcing the extension of the red zone offer to retirement villages, that letters of offer would be sent to each resident and CERA would work with village owners as quickly as possible to ensure the residents are assisted; if not, why not?

Hon GERRY BROWNLEE (Minister for Canterbury Earthquake Recovery): It was always the Government’s intention that red zone offers would go to residents. Receivables from the sale of retirement villages to the Crown must be applied to exit payments to residents via a statutory supervisor as a priority over any other person, including the owners, so that the residents’ interests are protected.

Hon Lianne Dalziel: Why was the wording of the media statement, which said a letter of offer would be sent to each resident, changed to the one now on the Beehive website, which says that an offer to each owner will follow, and was that designed to cover up the humungous blunder, as one person has described this communication of this policy?

Hon GERRY BROWNLEE: No, it is because the legalities around this mean that the owners of the rest home own the property—have the title to the property. The residents, in the cases we are generally talking about, have a licence to occupy. So by law—by one law—the settlement is with

the owners, but, as I said before, receivables from the sale of retirement villages to the Crown must be applied to exit payments to residents as a priority over any other person, including the owners, so that the residents’ interests are protected.

Hon Lianne Dalziel: How has he responded to the son-in-law of one of the former Kate Sheppard Gardens residents, who was advised by his colleague Kate Wilkinson that the Government was not about to make Lance Bunting a rich man, and that the Government was going to look after the residents, in light of the statement from his own office to Kate Sheppard Gardens’ statutory supervisor that there is no wider policy decision providing for top-ups above contractual obligations for residents?

Hon GERRY BROWNLEE: My advice is that the rest home that is mentioned by the member in this question has effected exit payments with all of its residents bar a few, who are still waiting to have their situation reviewed, and that it is currently—my advice is—a matter between the residents and the owner. But by and large the particular owner you mention has settled with his residents, unlike another owner, who has the expectation of an $8.712 million settlement from the Crown and $5.2 million worth of obligations to his residents, but is enlisting the help of some MPs to see whether he can wheedle more out of the Crown.

Hon Lianne Dalziel: Can the Minister confirm the advice that I received from the Canterbury Earthquake Recovery Authority that residents do get the first call on any money that legally goes to retirement village owners—that it is like being a preferred creditor, as they get first call on any money that is passed to the rest home owners—and will he actually apologise to all of those people whose hopes have been raised and dashed again with the announcement that he will not provide for the residents to be looked after in this matter?

Hon GERRY BROWNLEE: I repeat for the third time: any payments made by the Crown for the sale of rest homes or retirement villages must be applied to exit payments to residents via a statutory supervisor as a priority over any other person, including the owner, so that the residents’ interests are protected. That is exactly what the member has asked for, it is what we are doing, and there is nothing to apologise for.

Hon Lianne Dalziel: I seek leave to table a number of documents. The first is the press statement from Gerry Brownlee referring—

Mr SPEAKER: Order! We do not table—

Hon Lianne Dalziel: Excuse me, there have been changes to the wording from the website— [Interruption] I am sorry, Mr Speaker, but I am not putting it—

Mr SPEAKER: Order! We do not table press statements in this House. The member has other ways of getting her information out in the public if she wishes to. Tabling documents in this House is to provide members with information, and press statements are not part of that package. There are plenty of other mechanisms for the member to get her points out in the public, if that is what she wants to do. But the procedure for tabling documents is not a procedure for making political points. It is a procedure for providing information to members that they would not otherwise have available to them.

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

Mr SPEAKER: Point of order, the Hon Gerry Brownlee—I am sorry, the Hon Trevor Mallard. [Interruption] Order! I apologise, indeed.

Hon Trevor Mallard: It is not the worse thing that’s happened today. [Interruption]

Mr SPEAKER: Order! I want to hear this point of order.

Hon Trevor Mallard: I think it is a relatively important point, and I think you outlined very clearly the reasons that press statements are not tabled in this House, and that is because they are otherwise available. The point that my colleague was beginning to make, and was about a sentence off finishing, was that this press statement is no longer available, because it has been taken down and changed on the Minister’s website.

Mr SPEAKER: Presumably the press statement was available to all members.

Hon Trevor Mallard: But it is not now available to members.

Mr SPEAKER: Well, I will leave the matter for the House—


Mr SPEAKER: No, the House can decide. I will leave —

Hon GERRY BROWNLEE: I would like—

Mr SPEAKER: I will hear the honourable Leader of the House.

Hon GERRY BROWNLEE: I am prepared to put my original press statement up on TradeMe with a “buy now” price.

Hon Trevor Mallard: Speaking to the point of order—

Mr SPEAKER: No, no. I am not going to have any. I guess several members have got away with points of order today that are not points of order, and I blame myself, but I guess there has been some humour around all of them. I will leave the matter for the House to decide. I will let the member describe the documents.

Hon Lianne Dalziel: The first is the original press statement, dated 27 January 2012, which referred to a letter of offer going to each resident. The second is a summary of the SMS text messages with the Canterbury Earthquake Recovery Authority where I was trying to get details of the red zone retirement village announcement, as the advice I had had from the press was different from the statement I had received from the Minister’s office. The third is a letter to the Hon Gerry Brownlee, dated 6 February 2012, making him aware of the frustration their family feels at having a family member resident at Kate Sheppard Gardens, and the last document is the email from Peter Orpin, statutory supervisor for Kate Sheppard Gardens, explaining that he had spent several hours researching the matter and regretted to inform that the additional funds would not be forthcoming.

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

Overseas Investment Office—Meeting with Chinese Consul

10. Dr RUSSEL NORMAN (Co-Leader—Green) to the Minister for Land Information: Did Overseas Investment Office officials meet with Chinese political consul Cheng Lei late last year; if so, did they discuss Shanghai Pengxin’s bid for the Crafar farms?

Hon MAURICE WILLIAMSON (Minister for Land Information): I am advised that officials from Treasury and the Overseas Investment Office met with Mr Cheng Lei on 8 August 2011, which could hardly be described as late last year. Officials did not discuss the Shanghai Pengxin bid for the Crafar farms. The purpose of the meeting was to provide Mr Lei with an understanding of New Zealand’s overseas investment laws.

Dr Russel Norman: Does he consider that his officials should have alerted him to the fact that a senior Chinese Government official was meeting with the Overseas Investment Office, the very body that is tasked with providing recommendations on bids like the Shanghai Pengxin bid?

Hon MAURICE WILLIAMSON: If those Chinese officials had raised any one specific bid with the Overseas Investment Office, I would have expected it to have informed me. But given that the briefing was just on our general overseas investment regime, so that the Chinese delegate could be well versed on it, there is simply no need to be briefing anybody.

Dr Russel Norman: Is the reason why the counsel for the Overseas Investment Office raised the issue of the New Zealand - China free-trade agreement and the implications of the Shanghai Pengxin bid for that agreement connected with the meeting with the Chinese consul?


Peseta Sam Lotu-Iiga: Does the Minister have any examples of other high commission or embassy staff requesting such briefings from the Overseas Investment Office?

Hon MAURICE WILLIAMSON: I do, and, more important, can I say that under section 31 of the Act, which is headed “What regulator does”, it is actually made clear that the Overseas Investment Office must make itself available on request to explain the regime. I am very happy to say that on 8 June of last year some people from the Australian Senate, from the country where Russel Norman originated, made a request for it to do it, and then some of his countrymen from the Australian bureau of agriculture requested such a briefing on 21 June last year, as well.

NZ On Air Board—Papers Related to Documentary Funding Decision

11. CLARE CURRAN (Labour—Dunedin South) to the Minister of Broadcasting: What is the name of the documentary which was withheld in the papers released publicly by NZ On Air titled “Records of decisions made at working group meeting”?

Hon CRAIG FOSS (Minister of Broadcasting): I understand the documentary in question is still under development with the broadcaster, and decisions are still to be confirmed about whether it will proceed or receive funding from New Zealand On Air. I have not been made aware of the details of this documentary, and it would not be in the public interest for me to provide details because of the commercial sensitivity around decisions still to be confirmed by the board of New Zealand On Air.

Clare Curran: Who made the decision to withhold the name of the documentary?

Hon CRAIG FOSS: As pursuant to this question, I will just repeat my first answer. If the member is referring to the Official Information Act request tabled the other day, that Official Information Act request was to New Zealand On Air, I believe.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. It was a really simple question: who made the decision to withhold? It had nothing to do with the OIO.

Mr SPEAKER: The OIA. The member still makes a valid point. [Interruption] Order! This is an important issue. The Minister has indicated that there are issues of public interest around this. However, the member asked who made the decision to withhold the name of the particular programme that was deleted from a document. The Minister may not have that information, but it would be helpful if he made some reference to it in his answer.

Hon Gerry Brownlee: I raise a point of order, Mr Speaker. I would just like you to reflect on the line of questioning that has been going on on this for some days now. Increasingly those questions are starting to require the Minister to have ready knowledge of operational issues. That is simply inappropriate. I think to uphold questions that need answers that would require the Minister to have such operational detail is quite outside the understandings of how the separation between Governments and the entities themselves work.

Mr SPEAKER: Order! I appreciate the concern of the member, but Ministers in relation to entities like New Zealand On Air do have a responsibility to answer questions. Although they are not accountable necessarily for operational matters, they have a responsibility that enables them to be questioned on those matters. I accept that in this case the Minister may not actually have that information. If he does not have that information, there is no reason why he would necessarily be expected to have that information, because it is an operational matter presumably. He may not have that information, and that would be a perfectly reasonable answer if he did not have that information. If he did have the information, he may consider it to be delving into a matter that is still commercially sensitive. When you have a range of commercial programmes under consideration by New Zealand On Air, there may be commercial sensitivities around releasing any information about those. As to whether that is a matter of public interest, the Minister is the best person to judge that. There are a range of answers that are available to the Minister, but I think the question was in order.

Hon Gerry Brownlee: I raise a point of order, Mr Speaker. I would ask you to perhaps review that offering to the House at a later point, and, if necessary, come back to us, because I do not think it would be appropriate for members of this House to be able to ask details of police operations, or,

for that matter, some military operations, or, perhaps, about the Security Intelligence Service, or any range of other things. It also would mean that many Ministers would need to know quite considerable and extensive details about the operation of State-owned enterprises, for example. So there are sort of bounds under which ministerial responsibility is exercised, but it does not go right down to the daily operation—

Mr SPEAKER: I apologise to the member, but I disagree with what he is asserting here. I refer him to Speaker’s ruling 157/4: “There is no convention that Ministers are not answerable for operational matters;”. The Minister may not information on operational matters, or he or she may consider it not in the public interest to give detailed information on operational matters. But that does not preclude members from asking questions about operational matters, and, as I outlined before—I am trying to be helpful to that House—there are a range of answers available to the Minister. He must, of course, be truthful to the House, but if it is not in the public interest to reveal certain information, operational information, that is the Minister’s judgment, and the House cannot second-guess that. But to preclude members or prevent members from asking questions is not within the Standing Orders at all. So much time has expired, so I invite Clare Curran to repeat her question.

Clare Curran: Who made the decision to withhold the name of the documentary?

Hon CRAIG FOSS: If it is referring to the point in the primary question, that was a document released under the Official Information Act by New Zealand On Air, so I presume the answer would be pursuant to whoever signed out of that Official Information Act request to the member or whoever requested it in the first place. I do not know who that person was.

Hon Annette King: He doesn’t know much at all.

Mr SPEAKER: Order!

Clare Curran: Given the four documentaries released under that Official Information Act request from New Zealand On Air are listed together, who makes the decision to fund documentaries from New Zealand On Air? Is it the board that makes the decision to fund documentaries; if so, why is it that the name of the withheld documentary cannot be released?

Hon CRAIG FOSS: In respect of my primary answer, the general construct is that the Crown funds New Zealand On Air, the board of New Zealand On Air; New Zealand On Air has longstanding working groups and processes that decide themes and contestability, etc. for national programmes. They call them working groups. It is within that process that the members and those they engage with from the sector decide the content or the general direction of whatever programmes they end up funding.

Clare Curran: I raise a point of order, Mr Speaker. I have been trying to get the Minister to answer direct questions for a number of days. He gives—

Mr SPEAKER: Order! It is not an appropriate way to start a point with: “I have been trying to get the Minister to answer direct questions ...”. Forgive me, but I did not observe the last question to be a particularly direct question. But the Minister did answer the question. The Minister pointed out that these working groups are involved in making decisions, and he is not involved in them, and he did not go as far as, perhaps, to identify the final decision-making person, but I think it was an answer to the question. The quality of it can be judged, but then the quality of the question can also be judged by members of the House. The member has further supplementary questions available.

Hon Trevor Mallard: Would it be ethical for Mr McElrea, the chair of the Prime Minister’s electorate committee, who works closely with MediaWorks on these four documentaries, to tell the Prime Minister the topic of the documentary?

Hon CRAIG FOSS: I have full confidence in the board, the members of the board. They all operate under the Crown Entities Act 2004. I note that I also operate under the Broadcasting Act 1989, which prohibits me or any Minister to give any direction in respect of any programme or content.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. I think it was a pretty direct question—would it be ethical for the board member working with MediaWorks to tell the Prime Minister, whose electorate he is the chair of, the name of the documentary?

Mr SPEAKER: The member is really making an allegation—it is either a hypothetical question or an allegation, I am not sure which. But there are no precise answers to hypothetical questions, and let us assume it is a hypothetical question—let us put the best interpretation on it. The Minister has indicated that he has absolute confidence in the board and its members. I presume that confidence includes that it will behave ethically. As it was a hypothetical question, I do not think we can press the Minister too much further on that.

Hon Trevor Mallard: The point I am trying to work out, Mr Speaker, is whether it is ethical or not, and we cannot tell from that answer whether it is the Minister’s view that passing it on—

Mr SPEAKER: Order! The member though is, I presume, posing a hypothetical question: were a member of the board to do that. The Minister is indicating that he has confidence in the board, and I presume that includes that it will behave ethically. Clearly, the Minister is not prepared to get involved in the detail of what might be, in his view, ethical behaviour, compared with the requirements of the board under the Act. I do not think I can press the Minister further on that.

Clare Curran: How many conversations or representations has he had with the chair of the board on this matter, have they discussed the content of the documentaries, and was the name of the documentary that has been withheld mentioned during those conversations?

Hon CRAIG FOSS: I think there were three questions in there. I have regular meetings. I met with the chair initially as an initial meet and greet. I think we have had an update since then. Pursuant to the point of the primary question, I have not had discussions with the chair of New Zealand On Air, but let me just take this moment to thank the chair of the New Zealand On Air board—

Mr SPEAKER: The question was three separate questions. The Minister can answer any one of them. The first one, if I recollect correctly, asked how many conversations he had had with the chair of the board of New Zealand On Air, the second asked whether he had discussed the nature of these documentaries with the chair of New Zealand On Air, and the third asked whether the name of this particular documentary was mentioned in those discussions. The Minister can answer any one of those, but he should be able to answer that question, because the Minister would know whether he has talked about those matters, and the Minister has responsibility for what he talks about with the chair of the board.

Hon CRAIG FOSS: I have normal conversations with the chair of the board, as normal, on a range of matters about New Zealand On Air. We might have had a general discussion about this particular issue, but there would have been one or two conversations—nothing particular to this particular issue whatsoever.

Events, Major—Volvo Ocean Race Stopover

12. Hon TAU HENARE (National) to the Minister for Economic Development: What progress has he made declaring the Volvo Ocean Race Stopover a major event under the Major Events Management Act 2007?

Hon STEVEN JOYCE (Minister for Economic Development): Very good progress has been made. A paper has been approved by a Cabinet committee, and I expect the Government next week to endorse the declaration of the Volvo Ocean Race stopover next month in Auckland. Major events such as these are a significant contributor to New Zealand’s economy, so there are a number of protections in the Major Events Management Act. For example—and I pick a random example—as the author of the Act said at the time it was passed, “The bill … prohibits the on-sale of tickets at above their face value. As recent events show, those who buy up tickets and then seek to sell them at an unfair profit have deprived many Kiwi … fans of the opportunity to attend big events.”

Hon Tau Henare: Why are these kinds of protections under the Major Events Management Act necessary?

Hon STEVEN JOYCE: Event organisers need to be confident that their investment and marketing are not undermined. As the author of the Act said at the time, organisers and sponsors make huge financial commitments to make these types of events a reality, and clearly they do not want others to free-ride on their investments and trade off their goodwill. Indeed, there are those who would advocate these protections be extended to regional events, such as—I do not know, speaking hypothetically—Wellington’s Homegrown festival, although presumably not, in this case, the original sponsor of this Act.

Hon Tau Henare: What reports has the Minister received that suggest ongoing behaviour contrary to the intent of that legislation?

Hon STEVEN JOYCE: I have received a report as late as this morning highlighting the problem of ongoing ticket scalping for upcoming events, taking place in this case, apparently, from a red-painted ticket sales office in Naenae, which is possibly part of a chain of such offices all across Lower Hutt. Notwithstanding that the alleged perpetrator has been quoted in the paper as saying “It’s not what it looks like.”, I think in this case it is what it looks like, and what it looks like is a clear case of “Do as I say, but not as I do.”

Point of Order—Wording of Supplementary Questions

Hon GERRY BROWNLEE (Leader of the House): I raise a point of order, Mr Speaker. It is a serious point of order. Standing Order 170/8 refers to the way in which people may begin a supplementary question. I wonder whether you might reflect on that, and come back to us on it. It is not a big matter, but it is something that has come up three times today in supplementary questions.

Mr SPEAKER: Does the honourable Leader of the House mean Speaker’s ruling 170/8?

Hon GERRY BROWNLEE: Yes, Speaker’s ruling. It is not necessary to talk about it now.

Mr SPEAKER: Once I see what the matter is about, I will—

Hon GERRY BROWNLEE: That is fine. Thank you.

Mr SPEAKER: Members are aware that I have not been too strict on that issue. I am aware that previous Speakers have ruled that out, but the reason I have not followed that pattern is that I find it helpful if members listen to answers given, and then, in asking a further supplementary question, say “Given that answer” or “Given [something the Minister said]”, bringing focus to their question in that way. That is why I have not ruled out that kind of preface to a question.

Hon GERRY BROWNLEE (Leader of the House): I raise a point of order, Mr Speaker. That would be fine if, on all of the occasions, the word “given” did, in fact, refer to something that was immediately spoken, and not, in fact, to an assertion that was made in the first question. It is just one of those things that sometimes can creep in here, and makes question time a little difficult. I know the efforts you have made to get better answers to questions.

Mr SPEAKER: I am aware of the point the Minister is making. Of course, rather than ruling out questions that do that, I have allowed Ministers to use that alleged statement at the start of the question, and simply refute it. That is, to me, the discipline on members asking questions, because they do not get any answer if they do that sort of thing.


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