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Questions and Answers - July 11


Prime Minister—Statements

1. DAVID SHEARER (Leader of the Opposition) to the Prime Minister: Does he stand by all his statements?

Rt Hon JOHN KEY (Prime Minister): Yes.

David Shearer: Why does he stand by his statement on the prices New Zealanders are paying for power: “I think that they are paying a price … in relation to the environment we find ourselves in,”?

Rt Hon JOHN KEY: Because it is true.

David Shearer: Did he fulfil his undertaking to the House yesterday to check the figures that show New Zealand households will pay an extra $370 on average for power because his Government insists on taking out $1.16 billion in Transpower dividends?

Rt Hon JOHN KEY: No, but I did two things yesterday. One was that I went and looked on the Infratil website to see how it is bagging the Labour Party for misleading the country—

David Shearer: I raise a point of order, Mr Speaker. That piece of information has nothing to do with the question.

Mr SPEAKER: I think that on this occasion the Prime Minister has adequately answered the question.

David Shearer: Does he accept that pulling dividends out of a company that needs to invest $5 billion to strengthen the network means that family power bills are hit twice, first, to pay for the upgrade, and then, second, to pay for his Government’s dividend; if not, why not?

Rt Hon JOHN KEY: Dividends actually make no difference in terms of the pricing of power. I am surprised the member does not know that. What actually sets the transmission part of pricing is the Commerce Commission’s weighted average cost of capital charging. It has got nothing to do with dividends. Secondly, yes, Transpower has gone through a substantial upgrade. By the way, it started under Labour in 2005 when it invested $252 million and then in 2006 when it invested $288 million. So, yes, it has invested about $3 billion, for which it will get its weighted average cost of capital return, and that obviously has some impact. I suspect that what the Leader of the Opposition should do is that he should go and look this State-owned enterprise and then he should go and look at another State-owned enterprise called New Zealand Post, because it has got a letter waiting for him from the Labour Party caucus.

David Shearer: Does he think it is fair that his Cabinet awarded the chief executive officer of Mighty River Power a 34 percent increase on top of a $500,000 retention bonus at the same time as forcing New Zealand families to pay more than $370 extra in power?

Rt Hon JOHN KEY: Decisions on remuneration are made by the board of Mighty River Power. So the board of directors at Mighty River Power said to Doug Heffernan, their chief executive: “Doug, we love you.” But we know that in the Labour Party no one would go to—

Mr SPEAKER: Order! [Interruption] Order! That is sufficient.

David Shearer: Is he saying, therefore, that his Cabinet did not tick off the approval for the chief executive officer to be awarded a 34 percent pay increase and a $500,000 retention bonus; if not, why not?

Rt Hon JOHN KEY: What I am saying is that decisions of compensation are made by the board. Those decisions are held by the board. They may well tell the Government, under a nosurprises policy, but they are made the board.

Dr David Clark: How about answering the question?

Rt Hon JOHN KEY: Were you on the letter or not? Actually, last night—

Mr SPEAKER: Order! [Interruption] Order! There is no need to bring the Speaker into this debate.

David Shearer: Is he aware that under the Labour Government it did not take dividends from Transpower, and instead invested it back into the company rather than having to take dividends out and then ask consumers to pay for that?

Rt Hon JOHN KEY: Maybe I can answer that question by asking a question.

Hon Members: No!

Rt Hon JOHN KEY: I can see why your caucus meeting went so badly yesterday.

Mr SPEAKER: Order! Could the Prime Minister just address the question that has been asked.

Rt Hon JOHN KEY: OK, I will address the question. Was Labour the Government in 2002? If it was, it took a dividend from Transpower. Was it the Government in 2003? If it was, it took a dividend from Transpower. Was it the Government in 2004? If it was, it took a dividend from Transpower. Was it the Government—

Hon Annette King: I raise a point of order, Mr Speaker. [Interruption]

Mr SPEAKER: Order! [Interruption] Order! I have a point of order from the Hon Annette King.

Hon Annette King: I believe that in question time the members of the Opposition ask the questions and the Ministers answer. What we have had from the Prime Minister is a series of questions back to the Labour Party.

Mr SPEAKER: Order! [Interruption] No, I need no assistance from the Prime Minister. The question was asked and the Prime Minister chose his way of answering it. It was addressed.

Rt Hon Winston Peters: How does the Prime Minister justify paying $1.9 million to the “feed the schools” programmes and then $1.7 million to the chief executive officer of Mighty River Power; how can that possibly be equitable or fair?

Rt Hon JOHN KEY: The two are not correlated. For a start off, the Government spends about $70 billion – odd a year, so you can go and draw any particular thing. But in the end the compensation for the chief executive of Mighty River Power is determined by the board. It might be that he happened to be doing a good job. I know David Shearer is not, but Doug Heffernan—

Mr SPEAKER: Order!

Metiria Turei: Given the Prime Minister’s statement that he opposes a conscience vote on the Skycity convention centre bill, what pressure has he or his office placed on National MPs to vote against their conscience on the first reading of the bill?

Rt Hon JOHN KEY: Well, I never said I opposed that. What I said is that all National MPs will be voting for the legislation. The reason they will be voting for it is that this party went on the campaign trail and campaigned on this issue. Every single member of this party was elected on the back of that policy, just like the members of the Green Party were elected on some of the mad policies that they campaigned on.

Skycity, Convention Centre—Gambling-related Harm

2. HONE HARAWIRA (Leader—Mana) to the Minister for Economic Development: Does he think the Government’s decision to grant 230 new pokie machines, 52 new gambling tables, and a 35-year licence extension is worth the increase in relationship breakdowns, depression, suicide, family violence, increased money laundering, job losses, increased problem gambling and financial problems, as identified by its own Ministry of Business, Innovation and Employment-compiled regulatory impact statement; if not, why not?

Hon STEVEN JOYCE (Minister for Economic Development): I reject the premise of the member’s question for a number of reasons. The first point is to note that the regulatory impact statement states that harm from gambling may include the things the member refers to. It is also important that there are a number of things that mitigate those possibilities in this case. Firstly, it is by no means clear at all that a marginal increase in machines in one casino will increase gambling harm, especially when the total number of machines across Auckland and across New Zealand continues to decline. Also, the negotiated significant additional harm-minimisation measures that apply to all gambling machines across the casino will together act to reduce harm. Once the concessions are in place there is also absolutely nothing to stop the regulatory authorities introducing new harm-minimisation measures over time.

Hone Harawira: When the Minister said yesterday that it is difficult to quantify the potential size of any increased risk of harm, does that mean he did not read the full regulatory impact statement from his own ministry, which said: “an additional 4,779 … people may be at least partly affected by casino machines and an additional 3,600 … by casino tables.”, and does he now accept that the potential size of any increased risk of harm is not only quantifiable but also unacceptable?

Hon STEVEN JOYCE: No. In fact, the same statement—because it is important to get this in context—says that it is difficult to quantify the potential risk of any increased risk of harm. It goes on to say, in relation to the matters the member raises, that this is a hypothesis, and says in paragraph 91: “it is possible to hypothesise”. It then goes on to say: “It is difficult to estimate the additional numbers …” and “Putting a precise cost on this potential increase is also difficult.” So it does record a hypothesis as a possibility, but, as I answered in answer to the primary question, there are a number of things that mitigate that.

Hone Harawira: Does the Minister accept that the decision to grant 230 new pokie machines, 52 new gambling tables, and a 35-year licence extension is evidence that this Government operates on the basis that deliberately harming its own citizens is acceptable, as long as it achieves its own primary goals of allowing its fat cat friends to profiteer from New Zealanders’ misery, and getting free access for themselves; if not, why not?

Hon STEVEN JOYCE: I reject that assertion completely. This Government is focused on jobs and growth for New Zealanders. I appreciate that that member himself is against jobs and growth for his constituents in Te Tai Tokerau. This Government is focused on them. The reality is that many human activities have the potential for social harm, but the important thing is how you mitigate that risk.

Tax System—Improvements

3. MAGGIE BARRY (National—North Shore) to the Minister of Finance: How has the Government made the tax system fairer for New Zealand households and families?

Hon BILL ENGLISH (Minister of Finance): Over successive Government Budgets, the Government has made a number of changes to make the system fairer. It has removed the ability set up by the Labour Party to enable people to shelter their income in trusts, raised the effective tax rate on property investment, increased funding for the Inland Revenue Department to target property speculators and others avoiding tax, prevented people from using investment losses to make themselves eligible for Working for Families and other Government support, and brought in stricter rules to ensure multinational companies contribute their fair share of tax. At the same time, the

Government has reduced income tax rates across the board. Almost three-quarters of taxpayers now face a personal tax rate of 17.5 percent.

Maggie Barry: What changes has the Government made to income tax rates and other taxes to help families get ahead?

Hon BILL ENGLISH: In 2010 our tax package reduced tax on work and savings, and increased taxes on consumption and property speculation. After-tax incomes at all levels of taxable income were immediately increased by more than the increase in GST in 2010. The changes also made the tax system fairer. Two-thirds of the cost of the income tax cuts in 2010 went to reducing the bottom two tax rates. So someone earning $48,000 a year now has a top tax rate of 17.5 percent.

Maggie Barry: How does the income tax system interact with income support provided to lower-income families?

Hon BILL ENGLISH: Despite a recession and significant fiscal deficits, the Government has maintained a redistributive tax and income support system that supports low and middle income earners in New Zealand. At any particular time a large number of households, effectively, do not pay net tax. That is because the amount they pay in income tax is exceeded by the amount they receive from welfare benefits, Working for Families, paid parental leave, accommodation subsidies, and others. This is entirely appropriate to redistribute income from the higher-income earners to those genuinely in need.

Maggie Barry: How significantly do the income tax and income support systems redistribute incomes for New Zealand households?

Hon BILL ENGLISH: When we look at the way the system redistributes income, we can measure that by net tax for income groups—that is, the difference between the tax they pay and the assistance that they receive. For families earning under $60,000 a year, taking into account the income support payments and their income tax, they pay $2.7 billion in income tax and receive $1.8 billion of income support. That is the total for people earning under $60,000. The net effect of that is that for households earning over $150,000 it is 12 percent. The top 12 percent of income earners pay 76 percent of net income tax.

Hon David Parker: Is the Minister aware that his superficial analysis of tax paid by income group, firstly, takes no account of the fact that low and middle income people pay GST on the vast majority of their spending at higher effective tax rates than high-income earners, and, secondly, ignores the advice of the OECD that in New Zealand capital income earned by the wealthiest in society attracts virtually no taxation, which is unfair; if he is not aware of either of these things, does it not show that his latest educational trip to the OECD was a waste of time and money?

Hon BILL ENGLISH: No, that is not true. If he is concerned about the capital gains of the wealthy not being taxed, that is actually part of his policy, because he wants to exempt the family home from his capital gains tax. Secondly, when you look at the distributional effects of GST, in fact, it is relatively neutral. The Labour Party has to get used to the idea that the 2010 tax package reduced inequality in income tax distribution in New Zealand.

Skycity, Convention Centre—Gambling-related Harm

4. METIRIA TUREI (Co-Leader—Green) to the Minister for Economic Development: When he said that gambling-related harm from the SkyCity deal would be mitigated by “negotiated, significant additional harm minimisation measures” did he mean measures additional to those the casino is already obliged to use; if so, how?

Hon STEVEN JOYCE (Minister for Economic Development): Yes. The Government has negotiated a number of significant harm minimisation measures as part of the agreement with Skycity. These include the introduction of the predictive modelling tool, which analyses data to identify players at risk of problem gambling. Skycity is also being required to implement a voluntary pre-commitment system, where players can elect to restrict the amount of time they play or the amount they spend, and this applies to all machines at all times in the casino and will become

part of Skycity’s host responsibility programme. It will also have to introduce player identification requirements when amounts over $500 are being put on to, or cashed from, ticket-in, ticket-out machines in non-restricted areas, as well as, of course, doubling of the number of host responsibility specialists to deliver 24-hours-a-day, 7-days-a-week coverage in the casino.

Metiria Turei: How many of the 13,000 people and 6,500 children whom his advisers say will be harmed by this deal will not be harmed due to the supposedly additional measures?

Hon STEVEN JOYCE: I reject again today the premise of the member’s question. I have reviewed the regulatory impact statement fairly carefully, as you would expect, and it makes it clear that actually being able to determine a level of additional harm is not possible to do. They talk about a hypothesis, and it is very difficult to estimate the additional numbers of people who may experience problems. They also say that putting a precise cost on a potential increase is also difficult.

Metiria Turei: Will the Minister release all the advice he has received on the social harms of the extra gambling in this deal today so that when National MPs vote tomorrow, they are fully informed about the extent of the social harms in his bill?

Hon STEVEN JOYCE: I will check again, but my understanding is we have released most of the information that we have. There is some more information in regards to the negotiations, which will be released in the next little while, but I think particularly the key elements in relation to potential harm have been released and are also very adequately traversed in the regulatory impact statement.

Metiria Turei: Will the Minister explain to his colleagues before they vote tomorrow why the New Zealand Police and the Ministry of Justice were excluded from the discussions to introduce ticket-in, ticket-out technology throughout the whole casino, when his officials knew that those ministries would be concerned about the increased risk of money-laundering?

Hon STEVEN JOYCE: I am not sure that the member is correct on that, but certainly it is fair to say that my colleagues in the caucus of the National Party have had plenty of time, partly with assistance from the member, to assess their level of support for this particular arrangement, including, of course, the ability to assess whether the 230 machines are an appropriate arrangement to make for a very large convention centre, compared to, say, 230 machines for one a quarter of the size under the previous Government supported by the Greens.

Metiria Turei: I seek leave to table an email received by me under the Official Information Act dated 16 March 2012 from an official who says: “As for Justice and Police, they have obviously not been consulted on the details—”

Mr SPEAKER: Leave is sought to table that document. Is there any objection? There appears to be none. It can be tabled. Document, by leave, laid on the Table of the House.

Metiria Turei: Is it not the truth, Minister, that the Minister is frightened of supporting a genuine conscience vote on this bill because he knows that this bill, this deal, is hanging by a onevote thread?

Hon STEVEN JOYCE: I am pretty confident, and I know that the Government is pretty confident, about the votes on this side of the House, but I appreciate there are members on the other side of the House who might like the opportunity to vote for jobs and growth through this bill. I note that the Labour leader, for example, has allowed a conscience vote in this matter, and given the state of the Labour caucus, I expect a few more votes from them.

Hon Trevor Mallard: Is this Minister prepared to rule out using a process similar to this for a convention centre in another city?

Hon STEVEN JOYCE: Well, I can tell the member that there are no plans at all that I am aware of in this respect. What he raises is a hypothetical question, and we would deal with it if it came up at the time, but there has been certainly nothing raised in that regard.

Better Public Services Targets—Infant Immunisation

5. SHANE ARDERN (National—Taranaki - King Country) to the Minister of Health: What is this Government doing, as part of Better Public Services, to ensure that New Zealand children are better protected from preventable diseases such as whooping cough and hepatitis B?

Hon TONY RYALL (Minister of Health): New Zealand’s children are getting a better start in life as a result of progress towards the Government’s Better Public Services results, which include increasing infant immunisation rates so that 95 percent of 8-month-olds are fully immunised by December 2014, and maintaining this through to June 2017. The latest results show 89 percent of 8- month-olds have been fully immunised with their scheduled vaccinations, protecting them from serious diseases such as whooping cough and hepatitis B, and we are on track to achieve the 95 percent target.

Shane Ardern: What other work to protect people from preventable diseases contributes to the Government’s Better Public Services targets?

Hon TONY RYALL: Very early indications from the Government’s programme to reduce the incidence of rheumatic fever by two-thirds show a reduction in the incidence rate for acute rheumatic fever initial hospitalisations, but this is only one set of data, and so needs to be treated cautiously. For the second Budget in a row this Government has doubled its investment in the Rheumatic Fever Prevention Programme, from $12 million, to $24 million, to $46 million in Budget 2013.

Solid Energy—Financial Position

6. Hon DAVID PARKER (Labour) to the Minister of Finance: Given his statement yesterday that “Solid Energy was another example of where the incoming National Government had to clean up a mess left by the previous Government”, what was the level of debt held by Solid Energy on 30 June 2008 compared with the level of debt on 30 June 2012, and what is the total amount of dividends received by the Crown from Solid Energy since he became Minister of Finance?

Hon BILL ENGLISH (Minister of Finance): The amounts are $15 million, $295 million, and $163.9 million respectively.

Hon David Parker: Is the Minister of Finance aware that the Labour Government never approved of Solid Energy’s lignite developments, because of dubious economics and greenhouse gas emissions, and that he, the Minister, turned the first sod on Solid Energy’s lignite plant; and how is that the previous Labour Government’s fault?

Hon BILL ENGLISH: I think the member is mixing up a couple of projects there. One is the briquette plant, for which I did turn the first sod because it created jobs in a community where 400 jobs had been lost. I know, of course, that the Opposition was against the new jobs in Mataura, even though a whole lot of the people in Mataura vote for the Labour Party. Now I am asking them why.

Hon David Parker: I seek leave to table a photograph of Mr English and a sod.

Mr SPEAKER: Order! No, I am not prepared to put that leave.

Hon David Parker: Is the Minister aware that his National Government encouraged Solid Energy to expand its coal operations, take on more debt, and pay out higher dividends, all in the face of a falling coal price, and how is that the fault of the previous Labour Government?

Hon BILL ENGLISH: I have to say that Solid Energy did not need any encouragement. It had very large-scale plans for expansion, which the current Government disagreed with. Of course, we could have moved faster to slow down Solid Energy’s investment, but when we did move, the Labour Party organised a protest on the steps of Parliament, which means that we do not take its complaints about this very seriously.

Hon David Parker: I seek leave to table a document of Mr Brownlee’s—

Mr SPEAKER: Order! I am not prepared to entertain this any further. Would the member continue with his supplementary questions, if he has any.

Hon David Parker: I raise a point of order, Mr Speaker. Is it now out of order to table photographs that are inconvenient to the Government?

Mr SPEAKER: Order! That is questioning a previous ruling.

Hon David Parker: I raise a point of order, Mr Speaker. Is it out of order for members to seek leave to table photographs in this Parliament?

Mr SPEAKER: Order! I have given a substantial ruling on the tabling of documents. If a document is of assistance to members and gives them further, good information, I will allow the leave to be put. In this case, the member is attempting to play politics with a couple of photographs. I told him I would not put that leave. He continued his point of order, which is an abuse of the privilege of a point of order and will lead to disorder.

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

Mr SPEAKER: Order! The member has a right to raise a point of order, and it will be heard in silence.

Hon Trevor Mallard: My point of order is that we have had a Minister denying the promotion of coal, and a member trying to table a document that was promoted by a current Minister of the House and described as “Sexy Coal”. It seems inappropriate not to allow a document entitled “Sexy Coal” to be tabled.

Mr SPEAKER: Again, that member is now disputing a ruling I have already given, and I will take that very seriously if it happens again. Question No. 7.

Hon David Parker: Supplementary question.

Mr SPEAKER: Order! I had called Catherine Delahunty for Question No. 7.

Chris Hipkins: I raise a point of order, Mr Speaker. What happened before was that David Parker was raising a point of order with you when you indicated that you did not want to hear it, so you moved on to the next question.

Mr SPEAKER: That is exactly right.

Chris Hipkins: He had further supplementary questions. He had not at any point indicated to you that he had finished. Are you now saying that if you do not like something that is going to happen, you are just going to discontinue the question and move on? That is wrong.

Mr SPEAKER: No, the member is quite right—that is exactly what I am saying. If we are going to get into a situation—[Interruption] Order! If we are going to get into a situation where I detect that a member is creating disorder, then I will move on. On this occasion I will allow David Parker to finish his supplementary questions.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. You said in your ruling that you had relied upon a previous Speaker’s ruling. Can you tell us what that ruling is, please.

Mr SPEAKER: No, I did not say I had relied on a previous Speaker’s ruling. I said I had given a very substantive ruling some 2 or 3 months ago. I will send a copy to the member so he is fully aware of it.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. I am sorry. If I can just make it clear, it was a previous ruling of the current Speaker, not a ruling of the previous Speaker, that the Speaker was referring to.

Mr SPEAKER: And that is not a point of order. I have allowed David Parker to continue with his line of questioning.

Hon David Parker: Given the Minister of Finance’s statement on Monday about Labour’s criticism of his Government around Solid Energy and the Future Investment Fund, when he said “They need to show us who they’re going to borrow the money off, which foreign bankers are going to lend us the money.”, if his Government provides a loan to Solid Energy that is not from the Future Investment Fund, will the Government borrow for the loan, or is he just going to print the money?

Hon BILL ENGLISH: Just as with student loans, we will be borrowing for it.

Hon David Parker: Which is correct: that Treasury officials made a mistake reading the Cabinet minutes and appropriated $100 million from assets sale proceeds to “Solid Energy recovery facilities”, seemingly without Cabinet authority, and that this $100 million mistake was replicated in multiple Cabinet and Budget documents that he and other Ministers checked over and signed off in the lead-up to the Budget, somehow all missing the $100 million error; or that he is once again covering up for the misrepresentations by the Prime Minister, who feigned ignorance because he did not want to associate the Future Investment Fund with his Government’s mismanagement of Solid Energy?

Hon BILL ENGLISH: The second assertion is nonsense, and the answer to the first one is that Treasury did not describe correctly what Cabinet had decided.

Mr SPEAKER: Just before I call the member, the ruling I gave, for the benefit of the Rt Hon Winston Peters, was given on 19 February 2013. The Clerk has found a copy, and we will pass that to the member for his information.

Mining in Conservation Areas—Permits for Schedule 4 Land

7. CATHERINE DELAHUNTY (Green) to the Minister of Energy and Resources: Why did he grant a mining permit over Schedule 4 land in the Coromandel just six weeks after saying “I do not think there is any ambiguity in our policy. Let me say again that we have a very clear view against mining on Schedule 4 land”?

Hon SIMON BRIDGES (Minister of Energy and Resources): Because the mining permit granted to the Broken Hills Gold Company does not allow mining on schedule 4 land.

Catherine Delahunty: Why does Broken Hills Gold Company require access to 3 hectares of schedule 4 land, split into two distinct areas separated by 150 metres, in order to build the one additional mine exit that this permit requires?

Hon SIMON BRIDGES: Unlike the member I do not have a mining fetish, so it is difficult for me to claim expertise on these matters, but, as I understand it, the reason is that a wider area is needed as they search for health and safety purposes to find where the egress will be, then it would narrow down considerably.

Catherine Delahunty: I seek leave to table a Parliamentary Library - prepared map that shows the two areas—

Mr SPEAKER: Order! What is the source of the map?

Catherine Delahunty: The Parliamentary Library prepared this for me. It shows the two areas, unconnected, of 3 hectares, separated for one exit.

Mr SPEAKER: The easiest way of resolving this matter is that I will put the leave. Leave is sought to table that particular information prepared by the Parliamentary Library. Is there any objection? There appears to be none. Document, by leave, laid on the Table of the House.

Catherine Delahunty: Will the Minister clear up the ambiguity in the permit conditions by removing the word “and” in condition (b) that allows “mining underground and outside of Schedule 4” so that it explicitly states that only mining underground that is outside of schedule 4 will be allowed?

Hon SIMON BRIDGES: I thank the member for her legal interpretative skills and help on that matter, but the fact of the matter is that the permits are very clear. There is no mining on schedule 4 land.

Catherine Delahunty: Will he rule out granting a mining permit over the schedule 4 areas for which Sea Group Holdings Ltd currently has a mineral prospecting permit and Hawkeswood Civil Ltd holds a mineral exploration permit, given that there are no nearby mines that require these health and safety upgrades?

Hon SIMON BRIDGES: Off the top of my head I do not know a lot about the matters that the member refers to, but our policy, as she read out in the primary question, is very clear: no mining on schedule 4 land.

Catherine Delahunty: Will he now be assessing mining permits on schedule 4 land on a caseby- case basis, and is this not an erosion of his unambiguous promise to New Zealanders that he will not allow mining on schedule 4?

Hon SIMON BRIDGES: I think I have been very clear. Our policy is no mining on schedule 4 land.

Question No. 6 to Minister

Rt Hon WINSTON PETERS (Leader—NZ First): I raise a point of order, Mr Speaker. You referred me to a Speaker’s ruling of 19 February 2013 by you. I have read this document. It has two pages. At page 2 is a final paragraph. Nothing on page 1 refers to any substantiation of your ruling here in the House today, and page 2 certainly does not, as well. I am trying to find out why you used this as a precedent to make the decision you made against my colleague Mr Parker. It is not this document, I am telling you now.

Mr SPEAKER: Order! That ruling was very clear and was accepted by the House at the time. Where members seek to table a document that is genuinely informative, then leave will be put. Where a member is simply trying to make a further political point, that is not acceptable, and leave will not be put.

Hon DAVID PARKER (Labour): I raise a point of order, Mr Speaker. I think the point that the Rt Hon Winston Peters fairly makes is that there is no absolute prohibition on photographs. There never has been, and I do not understand there to be one. In the context of a photograph that is 5 years old, which mine was, in respect of a Government Minister promoting the opposite of what a Minister has just said was the Government’s position, I would have thought it is in order for leave to be sought and to be put to the House. The House is free to reject it. But I do not understand there to be a prohibition on political documents; it is just a prohibition on documents that are readily available to members.

Mr SPEAKER: The member now is questioning an earlier decision I made. I will decide whether leave will be put. If I feel the information is truly informative, I will certainly put the leave. If I am in doubt, I will tend to put the leave. But we are not going to have members taking up the time of the House attempting to make political points with the tabling of documents that I do not consider inform the House.

Rt Hon WINSTON PETERS (Leader—NZ First): I raise a point of order, Mr Speaker. We are dangerously into an area where you literally have a parallel where a court says it will not accept a photograph as evidence. This is what the member was seeking to do. If we get ourselves into that situation, we will make ourselves a laughing stock around this country. I hesitate to go any further than to say if you read the last paragraph of your precedent of 19 February, it is not a source of authority for what you have said in the House today—if you would like, I will read it back to you, because it is rather important.

Mr SPEAKER: No. Order! Listen, I have heard enough from the member. I have made a ruling on that particular point and that matter is finished—[Interruption] Order! That matter is finished. The member is now continuing to question a ruling that I have made. I am not prepared to tolerate that in the House today.

Better Public Services Targets—Advanced Trade Qualifications, Diplomas, and Degrees

8. TIM MACINDOE (National—Hamilton West) to the Minister for Tertiary Education,

Skills and Employment: What progress has the Government made on its Better Public Services target of increasing the proportion of 25-34 year olds with a Level 4 or above qualification?

Hon STEVEN JOYCE (Minister for Tertiary Education, Skills and Employment): Very good progress indeed. In 2012, 52.6 percent of all 25 to 34-year-olds had achieved an advanced trade qualification, diploma, or degree at level 4 or above on the New Zealand Qualifications Framework. This is up from 51.8 percent in 2011. That means over 8,100 more 25 to 34-year-olds gained qualifications at level 4 or above last year than in the previous year. The Government is working very hard to meet its target of 55 percent by 2017.

Tim Macindoe: What signals indicate the Government is on track to meet its target?

Hon STEVEN JOYCE: Well, for this target the number of 22-year-olds achieving level 4 or above qualifications is a very important indicator for the progress towards the overall target of 55 percent. That is because, of course, people who were 22 last year will turn 25 in 3 years’ time. In 2012, 34 percent of 22-year-olds had completed a qualification at level 4 and above in that year. That compares with 30 percent 4 years ago, in 2008, so that is encouraging progress. I am particularly pleased with the increase in achievement for Māori and Pasifika students. In 2012, 22 percent of Māori 22-year-olds achieved a qualification at level 4 and above, compared with 15 percent 4 years ago, in 2008. In regards to Pasifika, 26 percent of 22-year-old Pasifika students in 2012 had completed a qualification, compared with only 14 percent in 2008. So we are not there yet, but we are making very good progress.

Tim Macindoe: Why is the Government focusing on increasing the number of 25 to 34-yearolds with a level 4 or above qualification?

Hon STEVEN JOYCE: For several reasons: firstly, level 4 qualifications are the minimum standard of competency for many vocational occupations, and increasing the number of people with level 4 or above qualifications increases the skill levels in New Zealand workplaces and contributes to economic growth. A level 4 or above qualification also has a significant impact on an individual’s income for them and, of course, for supporting their family. For example, the median weekly income for 25 to 34-year-olds in 2011, when they had level 4 to 7 vocational qualifications, was $106 more a week than for 25 to 34-year-olds without those qualifications. And, of course, a higher-level qualification also means people tend to be employed, stay employed, and spend less time on the unemployment benefit than those who do not have qualifications.

Grant Robertson: Can the Minister confirm that the 52.6 percent result he is trumpeting today means that we are now just about back to where the percentage was in 2007?

Hon STEVEN JOYCE: Well, I do not have the percentage that the member has in 2007, but, like most things, tertiary education was running off the rails in the latter half of the previous Government’s job, so we had to turn it round and get some decent results, particularly with the money that was being wasted with all the “bums on seats” programmes.

Grant Robertson: In order to be helpful to the House, I seek leave to table this table from the State Services Commission that shows that it has just about reached the 2007 level.

Mr SPEAKER: Leave is sought to table that. Is there any objection? There is objection.

Hon Shane Jones: [Interruption] Suck it in, Steven.

Mr SPEAKER: Order! The member will just ask his supplementary question.

Hon Shane Jones: Why does he think it is agreeable for members of his department to come to the Māori Affairs Committee after having promised to provide a written briefing about the chief executive officer appointment process of one of New Zealand’s most significant tertiary institutions, only to provide absolutely nothing and to be sent away as an ill-prepared bunch of overpaid officials?

Mr SPEAKER: Order! It is a question that is very wide of the original primary question. That is the difficulty.

Hon Shane Jones: I raise a point of order, Mr Speaker. This is the Minister responsible for a wide-ranging level of responsibility. This is an incident that took place at a significant select committee. It is not unreasonable for us to ask him to give us his view.

Mr SPEAKER: That is not an unreasonable point, but a supplementary question must be related in some way to the substantive question that has been asked. The way the supplementary question was asked seemed to me to be a long distance away. If the member can sharpen up his supplementary question so that it is connected to the primary question, I am only too happy to assist.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. I apologise to my colleague for interrupting. This is one of the broadest primary questions available. What progress has been made and how they are going to do it are clearly going to be a responsibility of a chief executive, about which the questioning is now happening.

Mr SPEAKER: No, I think that particular point is a good try but wide of the mark. I will give the member, the Hon Shane Jones, the—

Hon Shane Jones: The primary reflects the words “Better Public Services”. It is in the context of Better Public Services. How—

Mr SPEAKER: Order! I am trying to assist the member. I am giving him a chance to ask a supplementary question related to this primary question, and I hope it is in order, for his sake and mine.

Tracey Martin: I raise a point of order, Mr Speaker. Kia ora. Just some clarification, Mr Speaker. My understanding of the original question is that it was around the Minister reporting on a university that delivers education at level 4 for 25 to 34-year-olds. If that was the case, would that not make it relevant to the primary question?

Mr SPEAKER: No, I do not think it does, because the second question was then around the employment of a chief executive of a particular tertiary education institution.

Hon Shane Jones: How does the conduct of his officials in preparing for a briefing to the Māori Affairs Committee on one of our significant wānangas contribute to the Government’s progress on Better Public Services targets?

Hon STEVEN JOYCE: My view is that their level of preparation obviously contributes to the targets. I think it is important that they prepare well and that they understand the various institutions and who has what responsibilities in the sorts of questions that they are asked. My understanding is that they may have provided that information to the committee accordingly.

Child, Youth and Family—Resourcing

9. JACINDA ARDERN (Labour) to the Minister for Social Development: Does she believe that Child, Youth and Family have the resources they require to care for the needs of our most vulnerable children?

Hon CHESTER BORROWS (Acting Minister for Social Development): I believe that Child, Youth and Family has been well resourced. This Government has increased its funding by nearly 15 percent over the last 4 years. We now have more social workers—about 250 more social workers— working with a bigger budget and investigating more cases in a more timely way. With the response-based interventions, there will always be times when resources are stretched, but I believe we do have sufficient resources to care for the needs of vulnerable children.

Jacinda Ardern: In light of that answer, how does the Minister explain her response to estimate questions, which shows that the longest wait for a Child, Youth and Family notification classified as “critical”—because the child was severely abused or was in immediate danger of death or harm— was 5 days, when they are meant to be assigned a caseworker within 24 hours?

Hon CHESTER BORROWS: It is important to note that the time frames that are referred to in the estimates questions referred to when recordings were made in respect of allocations, not in respect of the time action was taken or intervention was made.

Jacinda Ardern: How does the Minister explain that the longest wait for Child, Youth and Family notifications that are classified “very urgent”—because the child has been abused or

neglected and there is a risk of further abuse or neglect—was 31 days before a social worker was even allocated the case, when it is meant to happen within 48 hours?

Hon CHESTER BORROWS: I can only repeat the answer given to the previous supplementary question. I do not have specifics around the 31-day matter that the member has raised. I am happy to check it and get back to that member.

Jacinda Ardern: How also does the Minister explain the fact that the longest wait for Child, Youth and Family notifications that are classified as “urgent”—because although the child is protected from harm in the short term, there is an allegation of abuse, neglect, or serious concern— was 67 days, when they should have been allocated a caseworker within just 7 days?

Hon CHESTER BORROWS: Again, the recording of interventions and who case managers are in respect of individual cases is not necessarily consistent with when the intervention was made or when that allocation was made. We can put it this way for the member. As previously said in answer to the primary question, there are 15 percent more funded allocations towards Child, Youth and Family interventions now than there were before. To just make an analogy, in 2006 we had 1,089 unallocated cases. In 2012 there were just 95. This is out of 150,000 notifications to Child, Youth and Family.

Jacinda Ardern: Given these waiting times and the fact that since 2008 notifications to Child, Youth and Family that require further action have increased by 50 percent, or more than 20,000 cases, will the Minister commit to review the adequacy of baseline funding for Child, Youth and Family, as Labour did when it was in Government; if not, why not?

Hon CHESTER BORROWS: It is important to note that baseline funding is reviewed annually and this Government is responding in a very positive and popular way to the care of vulnerable children. A whole new strategy has been designed and is being rolled out currently and we are returning better results than have ever been returned before from Child, Youth and Family— certainly far better, as illustrated in my previous answer to a supplementary question, than that lot over there did.

Better Public Services Targets—Reduction in Reoffending

10. IAN McKELVIE (National—Rangitīkei) to the Minister of Corrections: What progress has the Government made on its target of reducing re-offending by 25 percent by 2017?

Hon ANNE TOLLEY (Minister of Corrections): I am pleased to advise the House that Better Public Services results released this week show that reoffending rates are down 9 percent since June 2011. There are also more prisoners than ever before involved in drug and alcohol rehabilitation, employment training, and education programmes. These results are very encouraging and show that the initiatives this Government is rolling out across the Department of Corrections are having a real impact on reoffending rates and are making our communities safer. To put these figures in perspective, a 9 percent reduction in reoffending means there are over 1,600 fewer offenders and 6,600 fewer victims.

Ian McKelvie: What further initiatives is the Government rolling out to improve offender rehabilitation?

Hon ANNE TOLLEY: This Government is determined to deliver programmes that address the drivers of crime: addiction, lack of employment skills, and poor education. As part of the reducing reoffending programme, every year we will be providing alcohol and drug treatment to 33,100 additional offenders and numeracy and literacy training to an additional 1,200 prisoners. To increase employment training, the Government is establishing full working prisons at Auckland Women’s Prison, Tongariro/Rangipō Prison, and Rolleston Prison. As part of this initiative work is under way to construct a building yard at Rolleston Prison, which will see prisoners repair 150 State houses from the red zone over the next 5 years. Prisoners will, of course, be provided with construction skills and qualifications that will help them find employment in the Christchurch rebuild on their release.

Ian McKelvie: What is the Government doing to reduce the chances of a prisoner reoffending following their release from prison?

Hon ANNE TOLLEY: Prisoners are at a high risk of returning to crime as soon as they are released from prison. Around 50 percent of prisoners are back in prison within 4 years. In addition to the increased rehabilitation that we are providing in prison, Budget 2013 made $10 million available from the justice sector fund to establish the new Out of Gate reintegration programme. This new nationwide post-release service will see prisoners supported as soon as they leave a facility. Up to 4,000 prisoners serving a sentence of less than 2 years will be allocated a dedicated provider who will connect them to social services and help with accommodation, employment, and general living skills.

Transport Planning—Alternatives to Motorways

11. DENIS O’ROURKE (NZ First) to the Minister of Transport: Does the Government believe that the future transport demands of New Zealand’s three main population centres will be less dependent on roading systems and instead utilise a greater proportion of alternatives to motorways?

Hon GERRY BROWNLEE (Minister of Transport): Neither of those positions is the Government position. We believe in an integrated approach to current and future transport needs, involving roads, rail, and public transport options.

Denis O’Rourke: If the Government will not accept the need for alternatives to more road capacity to meet a greater proportion of future demand, upon what basis does it expect to satisfy future demand?

Hon GERRY BROWNLEE: It is a great pity that the member did not hear my answer. I will repeat it for him. The Government believes in an integrated approach to current and future transport needs involving roads, motorways, rail, and public transport options.

Denis O’Rourke: Does the Government accept its responsibility to take a leading role in the development and provision of sustainable urban transport alternatives to roading in all of the main centres in the same way as it does for motorways, or does it expect local authorities to go it alone on this?

Hon GERRY BROWNLEE: In the context of our understanding of New Zealand’s needs, we do.

Denis O’Rourke: Does the Government see a place for much greater use of light rail in the main cities in the foreseeable future, other than just the—[Interruption]

Mr SPEAKER: Order! I am sorry to interrupt the member. Would the member please start again? I had difficulty hearing the question being asked.

Denis O’Rourke: Does the Government see a place for much greater use of light rail in the main cities in the foreseeable future, other than just the completion of the Auckland rail loop, in order to provide an effective and affordable alternative to motorcars and motorways?

Hon GERRY BROWNLEE: I think it is a very, very open question as to whether or not light rail in other parts of New Zealand would be an affordable alternative. The answer at this point is that we do not believe so.

Denis O’Rourke: In evaluating the long-term costs of passenger rail systems against more motorways, will the Government include all of the real costs of motorways, including externalities such as road accidents, ACC costs, air and water pollution, parking, and associated land costs, and for all those reasons does the Government accept the need to give higher funding priority to the alternatives?

Hon GERRY BROWNLEE: In the last measured year, New Zealanders travelled over 40 billion kilometres on the roads. That is not going to stop any time soon, no matter what the member might like to assert.

Mr SPEAKER: Question No. 12, the Hon David Cunliffe. [Interruption] Order! I would be reluctant to be asking a member to be leaving the House at this stage. I have called the Hon David Cunliffe.

Inland Revenue Business Transformation Project—Costs

12. Hon DAVID CUNLIFFE (Labour—New Lynn) to the Minister of Revenue: How much to date has been spent on consulting costs for the IRD Business Transformation programme?

Hon TODD McCLAY (Minister of Revenue): The cost for the period 1 July 2011 to 31 May 2013 for consultants and contractors engaged to assist with the transformation programme is $29.1 million. By contrast, I understand that the Inland Revenue Department has a budget spend on information and communications technology of $162 million over the equivalent period, to maintain support and develop its current legacy systems.

Hon David Cunliffe: Can he confirm that of that $29 million, over $23 million has been paid to one consultant, which is Capgemini, and can he explain what that vast amount of fees has purchased?

Hon TODD McCLAY: The last chairman of the Finance and Expenditure Committee wrote to the Minister and asked for information about that, and all information was given by the new Minister. I can answer that question because I happen to be both of those people. What I can say is that of the $29 million—

Mr SPEAKER: Order! Would the Minister just get to the answer?

Hon TODD McCLAY: Thank you, Mr Speaker. Capgemini is one of the 23 companies that have contracted to the Inland Revenue Department on the Business Transformation programme, and it has provided around four contracts. The member is correct around that amount.

Hon David Cunliffe: Has Capgemini provided an estimated total cost of the Business Transformation project; if so, approximately what is it?

Hon TODD McCLAY: No, I am not aware of whether that is part of the contracts that have been issued. We need to be a little bit careful that we do not get ahead of ourselves around total costs. This is an important project, with appropriate due diligence needed on it. We have around 7 million taxpayers in New Zealand. They have a right to expect value for money, and the due diligence we are going through at the moment will ensure the success of this project.

Hon David Cunliffe: If the Minister’s department has already paid over $21 million to one consultant and has not received an estimate of the total cost of the project, does he consider that good practice, and what action will he take to ensure that the project is properly costed?

Hon TODD McCLAY: That was not the answer that I gave.

Hon David Cunliffe: Have the Minister’s Cabinet colleagues been advised of the total cost of the project; if so, when?

Hon TODD McCLAY: I am not a member of Cabinet, but there are ongoing discussions. Indeed, Cabinet was first apprised of this issue some time ago, and I expect additional papers to go to it later in the year.

Hon David Cunliffe: I seek leave to table a summary list of all consulting spending on the Business Transformation programme, totalling nearly—

Mr SPEAKER: Order! The source of the document, please.

Hon David Cunliffe: It has been compiled from Inland Revenue Department documents by the Labour Party research unit.

Mr SPEAKER: On this occasion I will put the leave. Leave is sought to table that document. Is there any objection? There is.

Hon David Cunliffe: I seek leave to table a full list of consulting expenses from the Inland Revenue Department in relation to both the Business Transformation project and other matters for the last 5 years.

Mr SPEAKER: The source of that document?

Hon David Cunliffe: From the Inland Revenue Department.

Mr SPEAKER: Is it available on the website?

Hon David Cunliffe: Not that I am aware of.

Mr SPEAKER: On that basis I will put the leave. Leave is sought to table that information. Is there any objection? Yes, there is.


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