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Questions and Answers - April 4


Government Financial Position—Reports

1. TODD McCLAY (National—Rotorua) to the Minister of Finance: What recent reports has he received on the Government’s financial position?

Hon BILL ENGLISH (Minister of Finance): Excellent question! The Crown accounts issued today show a deficit of $5.5 billion for the 8 months to 29 February. The deficit is $395 million higher than the forecast of the pre-election update. This is due to a combination of factors. The Crown expenditure is $1.4 billion lower than expected, offset by lower than expected tax revenue tracking $1.2 billion below forecast; and there is also a $500 million increase in Earthquake Commission costs, mostly due to the 23 December earthquake.

Todd McClay: Why have the latest estimates of Earthquake Commission costs increased?

Hon Trevor Mallard: Because there was an earthquake on 23 December.

Hon BILL ENGLISH: Most of it is related to the 23 December earthquake, but alongside that we would expect to see fluctuations in the estimates for the costs of the earthquake to the Earthquake Commission, and, therefore, to the Government, because there is a massive information-gathering exercise going on down there in Christchurch. There is something like 120,000 damaged houses and over 600,000 claims. And as the Earthquake Commission moves through the process of understanding that damage in detail—working out, for instance, where there are duplicate claims— we can expect to see these numbers fluctuate fairly considerably.

Todd McClay: What progress is the Government making in keeping expenses under control?

Hon BILL ENGLISH: The Crown expenses are about $1.4 billion below forecast, at $45 billion for the 8 months to February. Some of those lower expenses will be due to timing issues—that is, expenditure has not occurred yet, but it will occur in the future. However, it does indicate, I think, that the tight focus on expenditure across the Public Service means that we are instilling some disciplines, and maybe we will end up spending a bit less than we expected.

Todd McClay: How will Budget 2012 contribute to the Government’s goal of returning to Budget surplus by 2014-15?

Hon BILL ENGLISH: Exactly how is yet to be finalised, but, as the Prime Minister has indicated, Budget 2012 will include little or no new net spending over the next 4 years. There will, of course, be new funding for health and education, but we would be looking to offset that funding with savings in lower priority areas and by tightening up tax loopholes.

Hon David Parker: Why did Government members of the Finance and Expenditure Committee block Treasury being called in to answer criticisms by the Auditor-General of Treasury’s mismanagement of the Crown Retail Deposit Guarantee Scheme, which added tens of millions of dollars, if not hundreds of millions of dollars, to the Crown’s losses under the guarantee scheme?

Mr SPEAKER: In so far as the Minister is responsible for that.

Hon BILL ENGLISH: That is really a matter for the select committee, but the issues have been thoroughly canvassed. Treasury has acknowledged some weakness in the early stages of the Crown guarantee set up, by the previous Labour Government, now 3½ years ago. Actually, even the Auditor-General has not been able to show that there were other actions Treasury could have taken to reduce the liability.

Budget 2010—Fiscal Neutrality of Tax Package

2. Dr RUSSEL NORMAN (Co-Leader—Green) to the Prime Minister: Does he stand by his statement that “if you go and have a look at the tax cuts, they literally were neutral” and, if so, what is the projected net cost of the first four years of the 2010 tax package?

Rt Hon JOHN KEY (Prime Minister): In terms of the second part of the question, the cost is $415 million, but by the fourth year, and for ever after, the package is strongly positive. In terms of the first part, regarding my quote, I was talking about all the Government tax changes over 3 years, both tax cuts and tax savings. These tax changes, including the 2010 Budget changes, were slightly fiscally negative in 2008-09 and 2009-10, but fiscally positive from 2010-11 onwards. So in the short term, yes, they are fiscally neutral. In the medium to longer term they are actually fiscally positive. They reduce Government deficits and reduce Government debt compared with the situation we inherited on coming into office. If the member wants me to I am happy to table this document that came from the Minister of Finance’s office; what it shows is the cost of the overall tax savings, tax packages, and the likes. If you go from 2008-09, there are these following astounding numbers. There is a cost of $427 million in 2008-09, the following year has a cost of $322 million, and then it is positive $270 million, positive $1.4 billion, and positive $1.83 billion. By 2013-14 it is positive $2 billion—a remarkable achievement.

Dr Russel Norman: Does he dispute the table on page 8 of the Minister of Finance’s executive summary for Budget 2010, showing that the projected 4-year cost of his Government’s 2010 tax cut package was a static $1.1 billion cost to the Crown?

Rt Hon JOHN KEY: Yes, because that measures something different. If you look at the overall tax costs and tax savings, as I said earlier, they are fiscally positive, or to put it into plain English, if we unwind them all we will have bigger deficits and bigger debt.

Dr Russel Norman: Does the Prime Minister dispute the table on page 8 of the year end Crown Financial Statements for 2010-11, which shows that his Government’s 2010 tax cut package has in practice cost about $1 billion in just the first 9 months?

Rt Hon JOHN KEY: Yes. I go back this document, which looks at all of the tax changes and tax savings. I am more than happy to table it if the member wants it, but let me go through it one more time. For 2010-11, for instance, there is a net gain of $270 million; by 2013-14 it is positive $2 billion. So if people want to vote for the Green Party and have these changes reversed, it will have to fund $2 billion per year of extra debt on top of the about $10 billion it wants to spend on other things.

Michael Woodhouse: How much larger would the Budget deficit be this year and for the next 2 years if the Government had continued with the tax settings it inherited on coming to office in 2008?

Rt Hon JOHN KEY: What an outstanding question. If the Government had not made all the tax changes that it did—both tax cuts and tax savings—the Budget deficit would in fact be $1.5 billion worse this year. The next year’s deficit would be $1.8 billion worse, and in the year after, the deficit would be a whopping $2.1 billion worse. So our changes are reducing the deficit and reducing the amount the Government needs to borrow. No wonder the IMF has praised this Government’s economic leadership in the paper this week.

Dr Russel Norman: Can the Prime Minister point to exactly what is wrong with the table produced by Treasury—not the letter produced by the Minister of Finance but the table produced by

Treasury—in the Crown Financial Statements for 2010-11, which shows that the net cost to the Crown of the 2010 tax cuts in the first 9 months was just over $1 billion?

Rt Hon JOHN KEY: The problem with the table is it shows one part of the Government’s overall tax changes. So it is all very well counting one bit, but if you do not count the other bit, you do not get the total package. That was why when the Minister of Finance got up in the Budget debate and announced it, he called it a package. There were lots of things in it, not just one thing.

Dr Russel Norman: Is the Prime Minister actually familiar with table 4 on page 8 of the financial statements of the Government of New Zealand prepared by Treasury, which does not have just one part of the tax package but includes all the different elements of the tax package? The conclusion of all the different elements is that the net effect of the 2010 changes was to cost the Government of New Zealand in just 9 months about $1 billion in lost revenue.

Rt Hon JOHN KEY: It really does not matter how many times the member says it; it does not make it right. The numbers that are right are the ones produced by the Minister of Finance’s office, and would have been supplied by Treasury, and what they show is that the package is net positive for New Zealand.

Dr Russel Norman: Has he read the Crown Financial Statements for February 2012, just released this morning, which show a further $360 million shortfall in GST revenue, a $200 million shortfall in income tax, and a $193 million shortfall in corporate tax, indicating that the costs of the Government’s 2010 tax cut package have blown out even further than indicated by the Crown accounts?

Rt Hon JOHN KEY: Yes, I have seen them. The illogical part of that member’s question is, in fact, that this Government raised GST. If we had not done that in the recent Budget, the number would have been even greater. There are a number of changes that are happening in the economy— and those numbers are against forecast—not the least of them being that there is a positive savings rate in New Zealand, so New Zealanders are consuming a bit less. Quite a lot of the taxes that were paid were around corporate taxes; that has been the big difference. And as a result of the global financial crisis both in investment and in property income there were substantial taxes paid in 2006 and 2007, when basically people were consuming debt. Now those losses are carried forward and it has had quite a big impact on the accounts. That is the big difference, as well as the unfunded tax cuts by the previous Government.

Dr Russel Norman: Is it not true that according to Treasury and the Treasury numbers the tax cut package was projected to cost $1.1 billion over 4 years, when it actually cost, according to the Government accounts, about $1 billion in the first 9 months, and today as a result of the new figures it is likely to cost even more than that when we look at the drop in GST and the other drop in tax takes?

Rt Hon JOHN KEY: In a word, no.


3. DAVID SHEARER (Leader of the Opposition) to the Prime Minister: Does he have confidence in all his Ministers?

Rt Hon JOHN KEY (Prime Minister): In a word, yes.

David Shearer: Does he have confidence in the handling of the Skycity negotiations by Steven Joyce, Nathan Guy, and Amy Adams, who at various times have had relevant responsibilities?

Rt Hon JOHN KEY: Yes, I do. I have considerable confidence in all those Ministers. They are doing an outstanding job of trying to negotiate over the development of a convention centre that would have a substantial impact on the benefit of New Zealand, by allowing conventions to be held that can bring significant economic gains to New Zealand.

David Shearer: Can he give an assurance that as part of the Skycity negotiations, his Ministers will not include an agreement to extend the period of the existing gaming licences?

Rt Hon JOHN KEY: I am not going to go through the individual parts of the package today, but what I can say is I have tremendous confidence that it will be a good package for New Zealand that will not require $350 million. But I must say I am stunned by the new-found objection to casinos from the Labour Party. I say that for this reason—

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. First of all, the Prime Minister said that he would refuse to answer the question. Then he began a tirade against those who know exactly what game he is up to, and I think you should have stopped him a long time ago.

Mr SPEAKER: The reason why I did not stop the Prime Minister sooner—and the member’s question is fair enough—is due to the interjection level from the Opposition. Just as the right honourable gentleman himself has observed when members interject while he is asking a question, I tend to tell the members not to be surprised if the member focuses on their interjections. Likewise, when the Prime Minister or a Minister is answering a question and the Opposition interjects a lot, members should not be surprised if the Minister latches on to some of those interjections and climbs into them. That is way this place tends to work, and the remedy is in members’ own hands. Members are wiser not to interject on questioners, and when answers are being given members are wiser to keep their interjections rare and reasonable. That said, I think the Prime Minister had gone on long enough. He was certainly at liberty to indicate that the question was more detailed, given the very, very broad primary question, than he would be prepared to answer. Given the broadness of that primary question, there is nothing unusual about that.

David Shearer: Can he give an assurance that as part of the Skycity negotiations, his Ministers will not include an agreement to make technology changes—or increase betting limits—that make it easier for people to lose money more rapidly?

Rt Hon JOHN KEY: I am not going to go into the individual parts of the deal, but what I can say is that harm minimisation is a significant issue. As I was about to say earlier, I am amazed that Labour is so concerned about casinos, because—

Mr SPEAKER: Order!

Rt Hon JOHN KEY: —in 1990 they brought them in.

Mr SPEAKER: Order! I am on my feet, and there was not the provocation on that occasion.

Rt Hon JOHN KEY: Oh, there was.

Mr SPEAKER: No. Order!

Hon Gerry Brownlee: Oh! But—

Mr SPEAKER: No, no—there was not the provocation on that occasion. I know the Prime Minister is very keen to get something out here, but this is question time. It is not the general debate; that comes later. The Prime Minister is perfectly at liberty in the general debate to say what he likes, but during question time he will answer the questions where it is in the public interest.

David Shearer: When did he first become aware that casinos returned 2.5 percent of their profits to the community and gaming trusts returned 37 percent, and does he think it is fair to increase casino revenue, while reducing trust revenue, in the light of these figures?

Rt Hon JOHN KEY: I first became aware when Labour brought casinos in to New Zealand in 1990, with the objective of promoting tourism, employment, and economic development.

Mr SPEAKER: Order! I am on my feet. I am not sure that that was the awareness that the questioner was seeking.

David Shearer: Is he confident that his Ministers are firm enough to negotiate a deal with Skycity that is in the public interest, and what differentiates New Zealand from South Australia, whose Minister said “There is no way we are going soft on them” when negotiating on Skycity’s overtures?

Rt Hon JOHN KEY: I can speak authoritatively that Mr Joyce is not only the Minister responsible for this; he is also the campaign manager, and trust me, he is firm enough.

Hon Trevor Mallard: Has he been briefed that that 1990 casino vote was a conscience vote, not a party vote, and will he support members having the right to exercise a conscience vote this year, as well?

Rt Hon JOHN KEY: Yes, and no.

Mental Health Services, Youth—Package

4. Dr PAUL HUTCHISON (National—Hunua) to the Associate Minister of Health: How will young New Zealanders receive better mental health services under the new Government package announced by the Prime Minister today?

Hon PETER DUNNE (Associate Minister of Health): The Prime Minister’s youth mental health project is an extremely comprehensive prevention-based $62 million package designed to provide practical support to young people and their families in dealing with the complex issues involved in adolescent mental health problems. It includes an additional $11.3 million over 4 years, to be made available for primary mental health care, including initiatives targeted at young people with mild to moderate needs. The Ministry of Health will be investigating ways in which primary care can be made more youth friendly. An expert group will be set up to work in partnership with the primary care networks to ensure that happens. Jointly with the Ministry of Social Development there will be the establishment of interim support for youth one-stop shops, ensuring that these organisations have sufficient administrative support and security of funding. Finally, the Child and Adolescent Mental Health Service will be charged with improving waiting times, and, along with primary care providers, ensuring a far more consistent approach to follow-up care.

Dr Paul Hutchison: How will young people and their parents experience better access to youth mental health services as a product of the Prime Minister’s youth mental health project?

Hon PETER DUNNE: The project is designed to work in four different places: in schools, online, in families and communities, and in the health system. There will be nurses and specially trained youth workers added to selected schools to help students who need appropriate care. Existing online mental health resources will be overhauled, and a social media innovations fund will be put in place to keep providers technically up to date. Because it is often difficult for parents to identify mental health issues in adolescents, we will also be providing more funding to nongovernmental organisations to assist them to get more information out to parents about what to look for and how to access health.

Rt Hon Winston Peters: Could the Associate Minister explain why a highly qualified, experienced doctor like Dr Paul Hutchison is not the Associate Minister of Health or Minister of Health—because he has qualifications—yet he, with no qualifications, is, or is that part of the deal he did with John Key before the last election?

Mr SPEAKER: Order! The Associate Minister has no responsibility whatsoever for the allocation of portfolios—no responsibility whatsoever. I do not want to deprive the member of a question, but he needs to bring his question within the responsibility of the Associate Minister of Health. Portfolio allocation is certainly not.

Hon Gerry Brownlee: He’s only a learner.

Rt Hon Winston Peters: Oh, really? We will see who is a learner shortly. I ask the Minister this. Given that Dr Paul Hutchison is a very experienced and highly qualified medical doctor, well renowned around this country for having the abilities to be an Associate Minister of Health—yet he is not—why did the Minister not decline the job when he asked for it and it was offered to him by John Key before the last election?

Hon PETER DUNNE: I accepted the invitation to take up this portfolio role because I believe very strongly in the initiative that has been produced today. In fact, I say to the member that one of the initiatives that it contains—the introduction of youth one-stop shops—is actually part of our confidence and supply agreement.

Dr Paul Hutchison: How will the success of the project be measured?

Hon PETER DUNNE: It will be measured at a couple of levels. Firstly there will be the success, if you like, in terms of uptake and in the improvement in adolescent mental health generally. But also the Prime Minister has made a commitment that will be carried through that the whole project will be evaluated in 2 years’ time to assess how it is working, what changes might be required, and what refinements might be made. The fundamental point that comes through in this is that we have a severe issue in New Zealand. We need to do what we can to boost and improve youth mental health service statistics and performance. In fact, the commitment of this policy is to achieve just that.

Iain Lees-Galloway: Given that one of the key drivers of youth mental illness is childhood poverty, why has the National-led Government allowed the number of children living in poverty to increase by over 34,000 since it came into office?

Hon PETER DUNNE: What the member should draw upon are the answers given earlier today by the Prime Minister, which indicate the significant impact that tax changes have had in improving the living standards of the most vulnerable New Zealanders. But what this package is about is addressing the needs of those who have severe problems, who are currently untreated, and who currently do not have access. By having a comprehensive programme operating across a range of portfolios, we are going to see significant improvement.

Overseas Investment Rules—Sale of Crafar Farms

5. Hon DAVID PARKER (Labour) to the Minister for Land Information: Has he or any other Minister this week sought further information on Shanghai Pengxin’s application for his approval to buy the Crafar farms, and if so, is it coincidence or purpose that this will further delay his decision on the application?

Hon MAURICE WILLIAMSON (Minister for Land Information): The answer to the first question is yes, and the answer to the second part of the question is neither.

Hon David Parker: Can he confirm that the application from Shanghai Pengxin has now been in process for nearly 11 months, and that the Overseas Investment Office said over a month ago that a new decision could be taken within days after the High Court decision found his earlier approval was invalid and illegal?


Hon David Parker: Has he delayed his decision so that it comes out after Mr McCully’s visit to China?


Hon David Parker: Were his approvals of the German purchase of Southland dairy farms and the American purchase of Central Otago dairy farms the largest ever of dairy farms to foreign buyers, and how long did it take him to make his decision on those approvals?

Hon MAURICE WILLIAMSON: I will not have a recollection of the exact time for any one specific application. However, I will point out that during the time in office of the Labour Government—

Mr SPEAKER: Order! The Minister answered the question. That was speech material, not an answer we were going on to there.

Mental Health Services, Youth—Schools

6. NIKKI KAYE (National—Auckland Central) to the Minister of Education: What initiatives is she introducing to help schools tackle youth mental health?

Hon HEKIA PARATA (Minister of Education): As the House is aware, the Prime Minister has just announced a youth mental health package. As part of this we will be investing $12 million over 4 years to expand the positive behaviour school-wide programme across all secondary schools. This will encourage a culture of responsibility and address problems like bullying. Nurses will also work with decile 3 secondary schools to undertake youth development checks, and will make

referrals where necessary. Nurses are already working with decile 1 and 2 schools under the schoolbased health services initiative.

Nikki Kaye: What other initiatives were announced?

Hon HEKIA PARATA: We will also be asking the Education Review Office to include student well-being as part of its regular reviews of schools. We will expect schools to be able to demonstrate what steps they are taking to improve student well-being, and to show improvement over time. Specially trained youth workers will work alongside nurses in selected low-decile secondary schools to further strengthen support for young people in need. They will also trial a new programme called Check and Connect, which targets young people who have disengaged, or who are at risk of disengaging, from schools. We will also pilot the FRIENDS for Life programme in 10 secondary schools. It aims to build students’ self-resilience and esteem in order to help them cope with depression and anxiety—key risk factors for suicide.

State Highway Projects—Affordability

7. JULIE ANNE GENTER (Green) to the Minister of Transport: Has the Government reviewed its highway building programme in light of the warning in the briefing to the incoming Minister that there will be a $4.9 billion funding shortfall if oil prices remain high and economic growth remains low; if not, why not?

Hon GERRY BROWNLEE (Minister of Transport): No; because I read all of the briefing to the incoming Minister, which makes it clear that if oil prices continues to rise, the $4.9 billion shortfall in forecast expenditure might occur in the period 2021 to 2030. It further says that this scenario is in the nature of a risk rather than a certainty. If we reviewed our roading policy every time there was a fluctuation in oil price or someone commented on our growth rate, we would do nothing.

Julie Anne Genter: If he believes that oil prices are cyclical or fluctuating and not rapidly trending upwards, when will oil prices fall back below $68 a barrel, which was the 2012 oil price forecast when the Government first budgeted for the roads of national significance?

Mr SPEAKER: As far as the Minister of Transport has any responsibility for oil prices, I call the Hon Gerry Brownlee.

Hon GERRY BROWNLEE: If I knew that, I would not be in this Parliament—that is for sure.

Julie Anne Genter: Has he seen the Crown’s Financial Statements published today that show that road tax revenue is $66 million below forecast this year, and will the Government be pumping more money from ordinary Crown revenue into his motorway projects to make up the shortfall?

Hon GERRY BROWNLEE: Yes, and no, because the funding for roading projects comes from the road users.

Julie Anne Genter: Has the Government determined conditions under which it would not be fiscally responsible to continue to prioritise the roads of national significance; if so, what are they?

Hon GERRY BROWNLEE: One of the interesting things in the briefing to the incoming Minister is the prediction that there will be more alternative fuel vehicles on the road in the period during which the shortfall may occur. What we do notice is that those alternative fuel vehicles will still need roads, so we will still be building them.

Julie Anne Genter: Do not road users deserve their money to be spent on transport projects that will give the most bang for their buck, that are well supported by evidence, and that protect all New Zealanders from rising oil prices?

Hon GERRY BROWNLEE: Every bit of evidence I have seen suggests that New Zealanders like the roading projects.

Justice, Minister—Statements

8. CHARLES CHAUVEL (Labour) to the Minister of Justice: Does she stand by all the answers she has given to questions asked of her to date?

Hon JUDITH COLLINS (Minister of Justice): Yes, so long as they are in context and I am not being misquoted.

Charles Chauvel: Why did she tell the House on 21 March that the current rate of breaches of police safety orders is “not anywhere near what anyone else would expect”, only to tell the Waikato Times today that legislation was needed this year to increase the penalty for such breaches, and should the House believe that there is a problem, as she told a newspaper today, or that there is not a problem, as she told the House last month?

Hon JUDITH COLLINS: Well, of course, I have been misquoted by the Waikato Times. What I have here is in fact an email from my office to the Waikato Times yesterday, advising it what the correct information was. It misquoted it; it has now retracted it and corrected it.

Charles Chauvel: Why did she tell the House yesterday that the inquiry by the Privacy Commissioner relates to “privacy matters in ACC and what has happened to particular emails and other documents. It is not specifically about my office.”, yet when Andrew Little asked her directly last Thursday questions about her office such as “When was the email she received … from Michelle Boag concerning Bronwyn Pullar … first printed by … her office?” she declined to answer, on the ground that the matter was before the Privacy Commissioner, and should the House believe what she said yesterday, or last Thursday, or both, or neither?

Hon JUDITH COLLINS: Obviously I am right on this matter, because Mr Little’s question was regarding a breach of privacy that has been claimed in relation to something in March. That is part of the terms of reference of the Privacy Commissioner’s review, so I do not know what is wrong with that.

Charles Chauvel: Why did she tell the House yesterday that as Minister of Justice she has no ministerial authority or responsibility for threatening news media and members of this House with meritless defamation proceedings, when she wrote to threaten just such proceedings last Thursday on her official letterhead, which describes her as Minister of Justice?

Hon JUDITH COLLINS: This is too easy: because they are not meritless.

Charles Chauvel: How long will this Minister continue to give inconsistent answers to questions put to her, to give spurious excuses to avoid answering inconvenient questions, and to try to bully the media and members of this House via threats of meritless defamation proceedings, and does she not think that the public expects better from the Minister of Justice?

Hon JUDITH COLLINS: There are four questions there, and most of them insulting. However, what I do know is that the public expects members of Parliament to have integrity and courage, and it is something that member should think about.

Rt Hon Winston Peters: Will the Minister resign if it is found that either she or someone whom she has had authority over was responsible for the leak in question?

Hon JUDITH COLLINS: Of course I would, because I have integrity—something that is lacking for some people. I seek the leave of the House to table the email from my office to the Waikato Times yesterday with the correct information.

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.

Christchurch, Business Recovery—Enterprise Precinct and Innovation Campus

NICKY WAGNER (National—Christchurch Central): What action—[Interruption]

Mr SPEAKER: I apologise to the member. There is no way I can hear Nicky Wagner at the back of the House there. The previous question has now been dealt with, and I want to hear Nicky Wagner on question No. 9.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. The only point is that as you said that, you looked this way. Actually, it was the Minister again who stimulated the interjections.

Mr SPEAKER: Order! The noise I heard coming from my left prevented me from hearing Nicky Wagner, and that is what I was responding to.

9. NICKY WAGNER (National—Christchurch Central) to the Minister for Economic

Development: What action has the Government taken to contribute to the recovery of high-tech businesses in Christchurch?

Hon STEVEN JOYCE (Minister for Economic Development): Yesterday I was in Christchurch to announce the $1.8 million investment by the Ministry of Science and Innovation and New Zealand Trade and Enterprise over the next 3 years for the development of a high-tech business hub in central Christchurch. The centrally located Enterprise Precinct and Innovation Campus, known as EPIC, was developed in collaboration with the private sector, the banking sector, and the Christchurch City Council. It will give 16 high-tech Christchurch businesses, which have been without permanent premises since February last year, a much-needed base for their operations.

Nicky Wagner: How does the Enterprise Precinct and Innovation Campus fit into the Government’s wider economic recovery plans for Christchurch?

Hon STEVEN JOYCE: The rebuild of Christchurch is one of this Government’s four main goals for this term, alongside building competitive businesses, delivering better public services, and, of course, returning the books to surplus. The Enterprise Precinct and Innovation Campus is one of the projects detailed in the draft central city recovery plan as a catalyst to bring people and businesses back to the central city, and is part of our wider support package for businesses that have been affected by the earthquake. I think this is a positive example of a public-private partnership that is not just about recovery; it is about encouraging new economic growth. The initiative will help Christchurch people remain in an attractive place, and, indeed, help the city become an even more attractive place for the high-tech sector and people working there.

Christchurch—Recovery Plan

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

Earthquake Recovery: When will he approve a Recovery Plan for Christchurch’s CBD in light of the Christchurch City Council’s announcement that it will commence its Annual Plan processes next week?

Hon GERRY BROWNLEE (Minister for Canterbury Earthquake Recovery): The central business district is a very small but important part of the Christchurch City Council’s total area. The annual plan covers all of Christchurch, and it is appropriate that the council progress that. Discussions within the Canterbury Earthquake Recovery Authority and with the Christchurch City Council should see the central business district plan approval very soon. It must be enabling, it must give clear direction, and once greater clarity and certainty about its effect is understood, an approval decision will be made.

Hon Lianne Dalziel: Why is he planning to establish a new economic development unit within the Canterbury Earthquake Recovery Authority, which will, among other functions, take over the Christchurch City Council’s planning function in the central business district?

Hon GERRY BROWNLEE: There is an economic development unit within the Canterbury Earthquake Recovery Authority. It does not have the authorities that the member speaks of.

Hon Lianne Dalziel: Is he denying that officials have been working on a Cabinet paper that recommends a new economic development vehicle for Christchurch, which includes the option of a unit in the Canterbury Earthquake Recovery Authority that will take over the planning role of the council in the central business district?

Hon GERRY BROWNLEE: I am not reporting to the House discussions that Cabinet might or might not be having. But what I would say is that we have been having a lot of discussions with the Christchurch City Council, and if the member wants some indication of what those discussions might be about in relation to the central business district, I suggest she reads volume 1 of its plan.

Hon Lianne Dalziel: How long can he continue to make these very important decisions about land use, building demolitions, and, now, taking over a core function of the city council behind closed doors without effectively engaging with the affected communities—nor, now, with the council that was democratically elected to govern this city—or is this what an earthquake tsar actually does?

Hon GERRY BROWNLEE: No, I reject that because in keeping with the sort of international best practice that we are using in Christchurch, we have taken a bottom-up, consultative, and community-driven approach to recovery. The member may now want to assert that that is not what is happening, but it is what she has called for all the time, and it is the doctrine that I have used in my deliberations and reports to Cabinet on these matters.

Overseas Investment Rules—Confidence in Overseas Investment Office and Ministers

Involved in Crafar Farms Sale

11. Rt Hon WINSTON PETERS (Leader—NZ First) to the Prime Minister: Does he have confidence in the Overseas Investment Office and his Ministers, Hon Jonathan Coleman and Hon Maurice Williamson, over the issue of the latest Crafar farms deal; if so, why?

Rt Hon JOHN KEY (Prime Minister): I do not have responsibility for the Overseas Investment Office, but I do have confidence in the two Ministers. I would note that the Ministers are not party to any “deal” with regard to the Crafar farms. They are simply assessing an application, as they are required to do under the Overseas Investment Act, which Labour brought into effect in 2005.

Rt Hon Winston Peters: It seems that the Prime Minister was asked in the primary question about the issue, not the deal; how can he have confidence in either of his two Ministers when a High Court decision has already so sadly demonstrated that they either do not understand or are not prepared to comply with the law they are acting under?

Rt Hon JOHN KEY: When the law was brought in by Labour in 2005 the understanding of the application of the law in terms of the benefits test, as interpreted by Crown Law and the advisers to the Overseas Investment Office, was a “before and after” test, not a “with or without” test. I would note that every application, including ones that were made when that member was a part of that Labour Government, was made with the “before and after” test, not the “with or without” test.

Rt Hon Winston Peters: Does the Prime Minister still not understand that those two Ministers were, on the High Court’s decision, found to have not even read sections of the legislation on which they were meant to act, and what did he mean about New Zealanders not becoming tenants in their own land, when under the agreement that those Ministers are looking at, Landcorp will be paying about $18 million a year by way of an equivalent fifty-fifty sharemilking deal on the propositions before it right now?

Rt Hon JOHN KEY: There are previous Ministers who have been known not to read their papers, but the current ones I have in my administration do.

Rt Hon Winston Peters: Can I ask the Minister why it is that he thinks that that is an adequate answer, when there are sections in the legislation, which the High Court went to pains to point out, that both the two Ministers and the Overseas Investment Office seem to have totally overlooked? What would give anybody confidence that those Ministers are now going to go ahead as they did before, and with the full backing of the Mandarin candidate we have here as Prime Minister?

Rt Hon JOHN KEY: With the greatest of respect, I do not think the member understands Justice Miller’s application of the law. And with the greatest of respect to the member, my mother was Austrian and my father was English. The nearest I have come to China is when I visited Beijing. Outside that, I do not have any Chinese blood in me.

Broadband—Australian Concerns Regarding Huawei Technologies

12. CLARE CURRAN (Labour—Dunedin South) to the Prime Minister: What did he mean when he told the NZ Herald and other media last week that “We are comfortable with the current arrangements we have” with regards to Chinese telco Huawei’s involvement in our national

broadband infrastructure, given that Australian Prime Minister Julia Gillard also said last week that “We’ve taken a decision in the national interest” to ban Huawei from even tendering for its broadband network?

Rt Hon JOHN KEY (Prime Minister): I meant that we are comfortable with the current arrangements.

Clare Curran: How does he reconcile his statement to the media last week that “We received good quality advice and we do the best to protect New Zealand businesses and consumers where we think that’s necessary.” with Julia Gillard’s statement that “We took appropriate advice and used that advice to make our decision.”, a decision that was to ban Huawei from tendering? Was the advice from the same source?

Rt Hon JOHN KEY: As I said to the House yesterday, I am not going to go—as no Prime Minister has—into the practice of commenting on security issues, other than I can say that we have taken into account all issues of network security. I am comfortable that the Government has taken a holistic view on that. And can I say how touched I am that the member has put in an Official Information Act request for Helen Clark’s advice.

Clare Curran: What did he mean when he told the New Zealand Herald last week that “He was aware of Australia’s actions but had a limited knowledge on the reasons for it.”? Had he not been briefed on Australia’s reasons for its decisions?

Rt Hon JOHN KEY: I simply do not get into public discussions about what briefings I may or may not have from Australian intelligence.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. The questioner asked the Prime Minister not what was the subject of the briefing but whether he was briefed. Surely he can answer that question and not offend his so-called self-made rule about not talking about national issues of security.

Mr SPEAKER: Order! The question actually contained much more than that. If I recollect correctly, it asked at the outset what the Prime Minister meant. When questions are framed like that, you cannot expect the Speaker to assist with the answers, because the answers are going to be so difficult to pin down. When members ask what a Minister means, it is a risky approach.

Clare Curran: Was he briefed on Australia’s reasons for its decision?

Rt Hon JOHN KEY: All I can say to the member is we have considerable dialogue with all of our partners in this area. That is about all I am prepared to say.

Clare Curran: Did he read—[Interruption]

Mr SPEAKER: Order! I have called Clare Curran.

Clare Curran: Did he read the report he received from his security agencies in 2010, and did it say that there were no mitigation measures that would totally counteract the compromising of our broadband infrastructure should Huawei be given the contract; and why did he not warn his Ministers accordingly?

Rt Hon JOHN KEY: Firstly, yes, I would have read that report, although it was a couple of years ago. Secondly, it would be worth it, if the member is really trying to ask me a direct question in relation to Huawei, if I could just make this comment. Not only is it one of the three major suppliers of this equipment in the world, alongside Alcatel-Lucent and Ericsson, but also it operates in Australia, it operates in the US, and it operates in the United Kingdom, Malaysia, Singapore, Hong Kong, and Japan. And, by the way, if it is so unwelcome in Australia, I was amazed to find out that it has just become the official sponsor of the Canberra Raiders.


Crown Retail Deposit Guarantee Scheme—Requests for Submissions

1. Hon DAVID PARKER (Labour) to the Chairperson of the Finance and Expenditure

Committee: Is it his intention to call the Treasury to appear before the committee to comment on

the Report from the Controller and Auditor-General on The Treasury: Implementing and managing the Crown Retail Deposit Guarantee Scheme; if not, why not?

TODD McCLAY (Chairperson of the Finance and Expenditure Committee): No; the Finance and Expenditure Committee considered this matter at its meeting on 4 April, and as a result I no longer have authority as chairperson to do so.

Hon David Parker: Is the Finance and Expenditure Committee currently scheduled to meet during any of the next 3 weeks, and if not, what process reason is stopping the Finance and Expenditure Committee using that free time to question Treasury about the Auditor-General’s criticism of Treasury’s loss of tens, if not hundreds, of millions of dollars?

TODD McCLAY: Any further decision about how to progress this item of business is a matter for the committee.

Darien Fenton: I seek leave of the House to have the Local Government (Council Controlled Organisations) Amendment Bill in my name introduced and set down as a member’s order of the day. This will bring transparency and accountability to publicly owned ports.

Mr SPEAKER: Leave is sought for that course of action to be taken. Is there any objection? There is objection. Would some—

Rt Hon Winston Peters: Mr Speaker, supplementary—

Mr SPEAKER: Is this another point of order?

Rt Hon Winston Peters: No, a supplementary question.

Mr SPEAKER: The New Zealand First Party has used its allocation of supplementary questions—

Rt Hon Winston Peters: Not when it comes to questions of the day to members.

Mr SPEAKER: —so there is no further supplementary question available.

Rt Hon Winston Peters: No, no, that cannot be.

Mr SPEAKER: I beg your pardon. I bet the member’s pardon, but traditionally in respect of questions to members there is only one supplementary question. I am unaware of other members of the House being able to ask supplementary questions—

Rt Hon Winston Peters: It is only $500 million.

Mr SPEAKER: Order! Just in case I am wrong, let me check with the Clerk to make sure, because I have not in my time as Speaker seen supplementary questions allowed to other members.

Hon Trevor Mallard: I think you let them run against Mr Bennett early in your time, when you were a very good Speaker, Mr Speaker.

Mr SPEAKER: The traditional practice has been one supplementary question to a member, but if I recollect correctly, when there were more supplementary questions allowed, they were allowed to the member questioning the other member, and that was because the Speaker was not satisfied that the questions had been answered. This would be a most unusual departure, and I do not think I should be allowing the traditional practice to be changed just on a whim. I am happy for the matter to be considered by the Standing Orders Committee, but I am not prepared to allow other members to ask supplementary questions to questions to members. In my time I cannot recollect when that was ever allowed. I am very happy for the Standing Orders Committee to look at it, but I do not think as Speaker I should be changing our practice.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. Just because the last questioner, David Parker, ran out of questions, I am sure he is able to give me a nod and say—

Mr SPEAKER: No, no—order! A nice try, but we are not going to go down this track today.


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