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Questions and Answers - September 3



State-owned Assets, Sales—Estimated Revenue

1. Hon CLAYTON COSGROVE (Labour) to the Minister of Finance: Does he stand by his statement regarding the estimated proceeds of asset sales that “I just want to emphasise that it is not our best guess; it’s just a guess”?

Hon BILL ENGLISH (Minister of Finance): Yes. I think the member is referring to a discussion over Treasury estimates required by law of the proceeds of the Government’s share offer programme, where it picked the mid-point in a range of $5 billion to $7 billion, and it picked that mid-point simply because it was the mid-point. That is what I was referring to. It was not possible then to be more precise, because there were so many variables—for instance, how much of the companies would be sold, how much people would be willing to pay for them, and, potentially, variable market conditions several years ahead of when that estimate was made.

Hon Clayton Cosgrove: Why is he still using his “guess” of $5 billion to $7 billion to be raised from asset sales, as noted in Budget 2013, given that since the estimate for his “guess” was made, his Government has driven Solid Energy into the ground, rendering it unfit for sale, and many analysts say that the value of Meridian Energy could be up to $2 billion less than it was a couple of years ago, when he made his “guess”?

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Hon BILL ENGLISH: A couple of years ago there was an estimate made of $5 billion to $7 billion, and, as I pointed out before, the reason for that range was the unpredictability of the market interest in the shares and commercial risks to the companies, because since that time, for instance, there is now a clear understanding that electricity demand in New Zealand has stopped rising and may well be falling at a time when supply generation is growing. That is why we have stuck with that estimate. If and when there is better information, then Treasury will be required by statute to take that information into account in the half-year update due in December.

Hon Clayton Cosgrove: Given that, by his own admission, he is guessing how much money will be raised from asset sales, and given that 2 weeks ago he said he did not know how much it would cost to sell Meridian Energy assets through the buy now, pay later scheme, does he understand why 86 percent of the public has absolutely no interest in purchasing Meridian Energy shares?

Hon BILL ENGLISH: I simply disagree with the member’s assertions. One thing we do know is that when we sold Mighty River Power, the proceeds to the Crown were $1.7 billion. That money is now safely in the Crown bank account, and the Government is pursuing its plan to invest that cash in other public assets. The Government does not apologise for banking significant proceeds from the sale of these companies. If the member disagrees with the policy, he should promise to buy them back. The money is in the bank; he can promise to buy the shares back.

Hon Clayton Cosgrove: Does he agree with the Prime Minister that the assets sales petition of 327,224 signatures that was certified by the Clerk of the House today is “dodgy” and was “signed

by children and tourists”; if so, why does he think attacking the democratic rights and integrity of 327,000-plus New Zealanders is acceptable or appropriate for him and his Government?

Hon BILL ENGLISH: I think the Prime Minister was attacking the reliability of the Greens’ signature-gathering process, which was financed by taxpayers’ money. In terms of democratic rights, this Government showed full respect for New Zealanders’ democratic rights by campaigning all election year in 2011 on this policy, and we have followed that policy precisely. As the Leader of the Opposition at the time said, the 2011 election was a referendum on asset sales. This Government was elected and we proceeded with the policy.

Hon Clayton Cosgrove: Will his Government accept the Labour Party’s offer to hold the asset sales referendum alongside the next general election, thereby substantially reducing the cost, with one condition: that he immediately halt the asset sales programme?

Hon BILL ENGLISH: It is not untypical of the Labour Party to offer something that is not within its power; its potential leaders are doing that all over the country right now. I understand the Greens want the referendum petition acted on much more quickly than that, and I suggest the Greens and Labour try to sort out just when they do want that referendum to happen.

Hon Clayton Cosgrove: Why has his Government criticised the estimated $9 million cost of the referendum, which amounts to roughly 6 percent of the $150 million he and his Government have spent on asset sales to date, including on such items as brokerage fees, advertising, consultancy costs, bonus shares, legal aid, court costs, interest-free loans to investors, and increased director fees and chief executive officer salaries, or is it because once the referendum votes are counted, he and his Government will have lost any moral authority they believed they had in respect of the sale of State-owned assets?

Hon BILL ENGLISH: No, we do not agree with that. The Government’s moral authority to move on with the asset sales hinged on the fact that even the Opposition said that the 2011 election was a referendum on asset sales. We outlined our policies in detail and campaigned on them transparently. It was the dominant issue of that election campaign, and we have proceeded with the sales. At the end of the sales process, tens of thousands of New Zealanders will have had the opportunity to invest in quality assets, the Government will have billions of dollars less debt, and we will have better-performing companies as a result of it.

Question No. 2 to Minister

Hon TREVOR MALLARD (Labour—Hutt South): I raise a point of order, Mr Speaker. I would like to refer you and question No. 2 to Standing Order 377(1)(b). I ask you to rule that the tail part of this question is an argument or an expression of opinion and, therefore, should not be allowed.

Mr SPEAKER: I thank the member for his point. The question has been accepted. The question was authenticated at the time that it was accepted. I will be watching carefully the answers that flow from the question to make sure that the Minister responds in a way for which he has ministerial responsibility.

Hon TREVOR MALLARD (Labour—Hutt South): I raise a point of order, Mr Speaker. Given that ruling, I would now like to refer you to Standing Order 377(1)(a) and ask you—as you have ruled that this has been authenticated and is, therefore, a statement of fact—whether, in fact, it is necessary in order to render the question intelligible, and I ask you to rule that it is certainly not.

Mr SPEAKER: Well, I have ruled that the question is in order. The member can refer to any number of Standing Orders that he wants to. The question has been authenticated. The question has been accepted. The question is, therefore, ruled in order. I will wait now, carefully listening to the answers.

Economy—Government Financial Position and Better Public Services

2. JAMI-LEE ROSS (National—Botany) to the Minister of Finance: What steps is the Government taking to responsibly manage its finances and deliver better public services, following fast-rising government spending of the mid-2000s?

Hon BILL ENGLISH (Minister of Finance): We have followed some fairly basic rules that any prudent household or organisation would follow. We make sure that spending commitments are costed and that there are funds available to pay for those spending commitments, at the same time as balancing the need to support New Zealand families through uncertain times. The Government is on track for surplus next year. We have been able to deliver better results in health, education, welfare, and justice at the same time as reducing a very large surplus due in part to the Christchurch earthquake but also due in part to the policies of the previous Government. We intend to continue to deliver better results, in many cases for less funding.

Jami-Lee Ross: What are the benefits for New Zealand families of the Government’s responsible economic and fiscal management?

Hon BILL ENGLISH: The main benefit for New Zealand families has been that they have had a degree of security about their income support and their jobs through some of the more difficult times that this economy has endured in the last 30 years. The cost of living is rising at less than 1 percent a year—a 14-year low. The export sector has been growing in the last 2 or 3 years, despite a high dollar. New Zealand’s 2.5 percent growth in the last year puts us among the faster-growing economies in the Western World. Business and consumer confidence is at, or near, a multi-year high. The Government’s disciplined spending is taking pressure off exchange rates and interest rates.

Jami-Lee Ross: How does New Zealand’s current economic performance compare with the position that the Government inherited in 2008?

Hon BILL ENGLISH: The Government inherited the triple problems of domestic recession, which began early in 2008; the global financial crisis; and the unfunded spending commitments of the previous Government, which saw public spending increase by 50 percent between 2003 and 2008. The New Zealand public is being treated to a display of all the attitudes that led to that, in listening to the Labour leadership contest—

Mr SPEAKER: Order! [Interruption] Order!

Hon Trevor Mallard: I raise a point of order, Mr Speaker. I think you may have come to the same conclusion that I had, and that is that the member is offending under Speaker’s ruling 176/1.

Mr SPEAKER: Sorry, could the member repeat which—

Hon Trevor Mallard: Speaker’s ruling 176/1.

Mr SPEAKER: I thank the member for referring to a very helpful Speaker’s ruling. The Minister, at the very tail end of his answer, was moving into an area that I do not accept was his responsibility, and I certainly called him to order at that stage. Further supplementary question, Jami-Lee Ross.

Jami-Lee Ross: I will try this one, Mr Speaker. What alternative policies has he seen, and what are the differences between those alternatives and the approach being taken by this Government?

Hon BILL ENGLISH: The Government has set out on a plan to protect the most vulnerable through difficult times, to return to surplus, and to build a more competitive economy. Our policies have been directed at enabling businesses, in particular, to make the decision to invest another dollar, employ another person, and pay a better wage. There are alternative approaches that involve reckless spending promises with no credible plan to fund them, and policy proposals where the Government uses its regulatory powers as well as its cheque book to buy votes. That is the approach we saw through the mid-2000s. But to give credit where it is due, the Labour leadership candidates are promising to spend—

Mr SPEAKER: Order! [Interruption] Order! The Minister has no responsibility for that.

Hon David Parker: After Labour ran nine Budget surpluses and reduced net Government debt from 18 percent of GDP to zero, did he say in 2008, when the global financial crisis and recession hit: “This is the rainy day that Government has been saving up for.”?

Hon BILL ENGLISH: I did say that because we were presented with a pre-election update showing 10 years of deficits ahead of us and ever-rising public debt—that is, public debt that never stopped increasing—in those forecasts. I am pleased to say that we have turned it round, but I am worried to think that the Labour leadership candidates think that they could do it all again.

Mr SPEAKER: Order!

Hon David Parker: Why does he repeatedly blame the global financial crisis and the Canterbury earthquakes for his record borrowing of more than $50 billion in the last 5 years, and if the Government’s spending track was left in such bad shape, how was it that he could responsibly cut taxes?

Hon BILL ENGLISH: Well, it is just hard to know where to start there. The fact is that the tax packages were revenue-neutral—

Hon David Parker: 40 percent to the top 10 percent.

Hon BILL ENGLISH: No, they were revenue-neutral, and I am proud to say that we are the only developed country that has been table to increase GST and cut income taxes. No one else has actually been able to pull that off. In respect of the Government finances, well, as I said to the member, we were presented with 10 years of ever-growing deficits and ever-growing debt and with public services that were a complete shambles. We are proud to have been able to fix up that mess and do better.

Hon David Parker: Why is it that he finds corporate welfare so easy to justify, yet the idea of supporting the working New Zealanders, who keep this country going, through decent labour laws and fair wages seems to get him into a cold sweat and in need of a lie-down?

Hon BILL ENGLISH: The member is simply wrong. This Government has ensured, with regard to the people whom he is referring to—the people who go to work every day, work hard, and pay their taxes—first, that they get taxed at a fair rate, not a ridiculously high rate; secondly, that when they pay their tax, they actually get public services that work; and, thirdly, that they get an economy managed in a way that they can have some security that when they go back to work the next day, they will still have a job. We are very proud of our record in supporting working people in New Zealand through tough times.

Businesses—Subsidies and Incentives

3. Hon DAVID PARKER (Labour) to the Minister of Finance: What is the difference between a “one-off incentive payment” and a subsidy?

Hon BILL ENGLISH (Minister of Finance): One of the differences is that a one-off incentive payment happens once. I think the member is referring to a payment made to New Zealand Aluminium Smelters, and, as I have suggested to him before, he should go to Invercargill and tell the 800 people directly employed and the 3,000 people depending on it that the Government made a mistake.

Hon David Parker: Why does he not realise that he undermines his own credibility as Minister of Finance when he stands up and he pretends that the $30 million payment was not a subsidy?

Hon BILL ENGLISH: We have not pretended that it is anything other than what it was, and that was a payment to New Zealand Aluminium Smelters to ensure that the contract was signed. What I cannot understand is that Labour is in Northland promising subsidies to everybody, and in Southland saying that keeping the smelter open is a bad idea.

Hon David Parker: Does he believe that the electricity market is competitive; if so, did his Government’s interference by providing a $30 million taxpayer subsidy to the smelter have the effect of holding up power prices for other consumers?

Hon BILL ENGLISH: In answer to the first question, yes. New Zealand would be the only country in the world retreating from a competitive market if it followed Labour’s policy. The answer to the second question is that no one can quite tell.

Hon David Parker: Why is his Government interfering in the broadband market for the benefit of Chorus at the cost of its competitors and Kiwi consumers, or does he think that corporate welfare to Chorus, Skycity, and the smelter does not need to be justified, it just needs a cute name?

Hon BILL ENGLISH: No, I do not agree with the member. The reason that the Government is in the broadband market—and it does have its challenges, that is for sure—is that we formed the view, and, actually, I think the Labour Party formed the same view, that ultra-fast broadband infrastructure would not arrive in New Zealand for every household for about 10 years. So we took action, which we believe has been effective and focused, to bring forward the roll-out and implementation of ultra-fast broadband. If the member disagrees with that, then he is free to go out and rip it up, in the same way that he is free to buy back the assets that the Government sold, but I notice he is not promising that.

Hon Trevor Mallard: Was it part of the Skycity deal that Skycity would be protected from appearing before a select committee to give its version of the development of the contract?

Mr SPEAKER: The Hon Bill English, in as far as he has ministerial responsibility.

Hon BILL ENGLISH: I do not know what the member is talking about.

New Zealand Security Intelligence Service—Legality of Activities

4. Rt Hon WINSTON PETERS (Leader—NZ First) to the Prime Minister: Is he satisfied that the New Zealand Security Intelligence Service has always operated lawfully under his leadership?

Hon BILL ENGLISH (Deputy Prime Minister) on behalf of the Prime Minister: As far as I am aware, yes.

Rt Hon Winston Peters: If that is the case, why was there a raid in July of last year on the Fiji Democracy and Freedom Movement in New Zealand, an organisation promoting, by lawful and peaceful means, the restoration of democracy in Fiji?

Hon BILL ENGLISH: The member is referring to an operational matter, and, consistent with the practice of all New Zealand Prime Ministers, on the Prime Minister’s behalf I am not going to answer that question.

Rt Hon Winston Peters: As the Minister in charge of the NZ Security Intelligence Service, is it not a fact that the SIS acted on the pretext of a fictitious assassination plot against the Fiji military regime, yet claimed there was credible evidence of the plot?

Hon BILL ENGLISH: I do not intend to answer that question.

Rt Hon Winston Peters: As the Minister in charge of the NZ Security Intelligence Service, and the Prime Minister, can he let us know why the SIS claimed credible evidence of an assassination plot when the New Zealand Government later backed down when sued in the High Court for matters arising from the raid?

Hon BILL ENGLISH: In respect of SIS operations, I will not answer that question, and any issues related to the court will be a matter of public record.

Rt Hon Winston Peters: As the Prime Minister and Minister in charge of the NZ Security Intelligence Service, why, a week before the Minister of Foreign Affairs, Murray McCully, visited Fiji, did his Government engage in an illegal raid at the behest of the dictatorial regime in Fiji, if it was not an attempt to ingratiate itself with the Fiji military regime?

Hon BILL ENGLISH: I will not be answering a question on any operational matter, but—

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. I am not asking about what happened; I am asking “Did it happen?”. I have sat here for three supplementary questions, and he has been allowed to get away with saying he is not going to answer to this Parliament or the country. It is the nature of the question that either affords him shelter or not, and I do not believe

that I have couched those questions in such a way that he can escape by saying “I refuse to answer anybody.”

Mr SPEAKER: It is indeed the nature of the question, and the issue is around the New Zealand SIS, and the Minister, in this case answering on behalf of the Prime Minister, has said that he does not think it is in the public interest to answer that question. That is a satisfactory answer as far as I am concerned. I certainly accept it is not a satisfactory answer from the member’s point of view, but if that is the way the Minister chooses to answer the question, that is his choice.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. Are you seriously telling the House and the country that if there is an illegal raid by an agency of the State, then a Minister can get up and say—and I can prove that it was an illegal raid—“Well, I’m not answering at all.”? That cannot be the way this democracy has been conducted in the past, and I hope it is not the way it is going to be done in the future.

Mr SPEAKER: That is exactly what I am saying to the member. In this particular case it is for the Minister to accept responsibility for the answer that he or she wants to give, and in this case the Minister has chosen to say it is not in the public interest to talk about an operational matter concerning the New Zealand SIS.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker.

Mr SPEAKER: Well, is it a fresh point of order?

Rt Hon Winston Peters: Yes, it is a fresh point of order, because the essence of the matter is that I am not asking how the operation was conducted—who did it, when it happened, and on what day, and in what form. I am asking “Did it happen?”. That is not an operational matter—it goes to the fact.

Mr SPEAKER: For the final time—because that is not a fresh point of order; that is simply relitigating the earlier points of order, which I have answered—the Minister can choose how he decides to answer the question. In this case the Minister has, on all occasions, said he does not want to answer any further detail, because he does not consider it to be in the public interest. That is the prerogative of the Minister, and that is the course he has taken.

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

Mr SPEAKER: Before I start, can I also clarify that this is, again, a fresh point of order and not any attempt to relitigate the point of order I have just ruled on.

Hon Trevor Mallard: Well, it goes back, I think, three supplementary—

Mr SPEAKER: Order! Is it a fresh point of order or not?

Hon Trevor Mallard: It does ask you to look at your ruling in the context of the answer that was given by the Minister acting on behalf of the Prime Minister to, I think, the second supplementary question from the Rt Hon Winston Peters.

Mr SPEAKER: Well, I will accept that point of order. It is, in fact, asking me to reconsider an earlier ruling. I will certainly be looking very, very closely at the questions that were asked and the answers that were given, but at this stage I am not changing my ruling.

Research and Development—Internships

5. Dr CAM CALDER (National) to the Minister of Science and Innovation: What progress has been made in the Government’s plan to provide internships for students in New Zealand’s research and development intensive industries?

Hon STEVEN JOYCE (Minister of Science and Innovation): In Budget 2013 the Government provided funding for the research and development student grants scheme to give science, technology, engineering, and design students the opportunity to work with some of New Zealand’s top commercial research and development facilities. Today I am pleased to announce to the House that $3.5 million has been allocated by Callaghan Innovation to successful research and development - active businesses, enabling them to employ nearly 300 undergraduate and postgraduate students. The student grants will give New Zealand’s future innovators a head start in

their careers by enabling them to develop their technical skills working in a commercial research environment. It will also be beneficial for industry by helping to speed up businesses’ research and development work, thanks to the contribution of bright young minds with the latest knowledge and a fresh perspective.

Dr Cam Calder: What are some of the projects that have been funded through the student research and development grants scheme?

Hon STEVEN JOYCE: High-calibre proposals were submitted by some of our most innovative high-tech companies, as well as a great number of ambitious new start-ups. One hundred and fifty companies will benefit from the programme this year. It is great to see those companies recognising the value of innovation and the need to provide career development opportunities for our future innovators. Some of the funded projects include developing a pest control tool kit and applying biodegradable plastics to advanced trapping systems, market-driven product development for the health sector, and improving road surfaces through the application of novel materials.

Dr Cam Calder: What other steps is the Government taking to boost science and innovation in New Zealand?

Hon STEVEN JOYCE: This Government recognises that science and innovation are the key drivers of economic growth and are making New Zealand businesses more internationally competitive. We have increased total funding for science, innovation, and research across government to $1.36 billion in the current financial year, after $1.24 billion last year and just over $1 billion 4 years ago. In Budget 2013 we allocated an additional $75 million over 4 years for business research and development grants, and $31 million over 4 years for repayable grants for start-up businesses. And, of course, we have established Callaghan Innovation, our new high-tech headquarters for business research and development.

Hon Trevor Mallard: Does the funding for the internships include funding for air travel for interns who will work on projects previously done at Ruakura Research Centre or at KiwiStar Optics, which are now going to be done in Melbourne and Sydney?

Hon STEVEN JOYCE: I think the member does not understand the way the research and development student grants work, so let me take him through it. The students are working in private sector companies that are already established and operating their own businesses, doing research and development. You get a young undergraduate or postgraduate at a university—let us say for example, at the University of Auckland’s engineering school—who wants to get out and actually do some work in a business environment before they qualify and before they graduate. They can go along and work at this business and build business relationships, and get an understanding of what it is like to work in the real world. I think all of those are great things.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. It was a very specific question about whether there would be airfares available for interns to work with companies—KiwiStar Optics being an example—that were previously based—

Mr SPEAKER: Order! It sort of was, but if the Minister could help by focusing on the essence of the question, which was whether the funding include airfares.

Hon STEVEN JOYCE: I do not believe that the funding does include airfares, and I would point out again to the member that I thought he already understood that KiwiStar Optics was not a private sector firm in that regard, and, therefore, it answered the question. I think the premise of his question is simply incorrect as well.

State-owned Assets, Sales—Citizens Initiated Referendum

6. Dr RUSSEL NORMAN (Co-Leader—Green) to the Minister for State Owned

Enterprises: Will the Government suspend its asset sales programme until a referendum on the issue has been held, given the Clerk of the House has certified that 327,000 New Zealanders, or more than 10 percent of voters, have signed a petition triggering that referendum?

Hon TONY RYALL (Minister for State Owned Enterprises): No.

Dr Russel Norman: Does he agree with John Key’s comments of 25 June 2008 in support of the public’s right to have citizens initiated referenda like this one, where John Key said: “I actually have respect for the New Zealand public’s right to express their views …”, and went on to say that a Prime Minister who opposes that is “arrogantly out of touch with New Zealanders”?

Hon TONY RYALL: Of course I would have to agree with the Prime Minister.

Rt Hon Winston Peters: You always do.

Hon TONY RYALL: I always do. But I am not able to necessarily confirm the quote that the member has given to the House.

Dr Russel Norman: Can he confirm that if the Government proceeds with its privatisation programme before the referendum is held, this will mark the first time a Government has actively implemented a policy that is the subject of a valid citizens initiated referendum petition without giving the public a chance to vote in the referendum?

Hon TONY RYALL: The Government has already begun to implement its policy in respect of the mixed-ownership model. We have already sold 49 percent of Mighty River Power. As a result of that, we have $1.7 billion of cash, which is earmarked for important public services like Christchurch Hospital. I would draw the member’s attention to the fact that even though 87 percent of New Zealanders who voted in the anti-smacking referendum opposed that legislation, that member opposite said that people should ignore that referendum.

Dr Russel Norman: Is he aware that contrary to that referendum, which actually happened after the policy was implemented, this Government has an opportunity to suspend the sale of Meridian Energy and the other energy companies while waiting for the people of New Zealand to give their opinion on the issue of asset sales through a referendum, which has now been initiated?

Hon TONY RYALL: I do not agree with that member’s statements, because this Government announced in January 2011 its proposals around the mixed-ownership model. They were then detailed in the Budget of 2011, which I think was in May. The model was then the centrepiece of the 2011 general election. The Leader of the Opposition at the time described the election as a referendum on asset sales in New Zealand, and the National Party received by far the largest number of votes of any party. The Labour Party received the lowest number of votes that it had ever received in a general election in recent times. It is clear from that election that this Government has the support to implement its policy. If we were not implementing our promises, the Opposition would be complaining.

Dr Russel Norman: Well, with regard to the Minister’s answer, which addresses the question of mandate, I believe, is he aware that 51 percent of voters in the last election voted for parties that are opposed to the asset sales programme, and that on every poll that has been done on the issue since, more than 60 percent of New Zealand voters have opposed the asset—[Interruption]

Mr SPEAKER: Order! I am going to ask the member to repeat that question, because I had trouble hearing it.

Dr Russel Norman: In light of the Minister’s answer, which goes to the question of mandate, is the Minister aware that at the last election 51 percent of votes cast were cast in favour of parties that opposed asset sales, and that since that election every poll has shown that more than 60 percent of New Zealanders are opposed to his asset sales programme; hence, why will he not test his mandate by putting it to a referendum?

Hon TONY RYALL: Actually, what matters is that more people voted to enable National to form a Government than to enable any other single party to form a Government. What the member needs to know is that once you are in Government, you are expected to honour the pledges of your campaign. We had one of the highest results in our party’s history, and we are proceeding to implement our policies. They are important because we need that money in order to invest in important social assets like the Christchurch Hospital rebuild, and important schools through the 21st century schooling project. The money is vital to that social investment and is, actually, of greater benefit to New Zealanders.

Dr Russel Norman: Will the Government accept the Green Party’s offer, along with Labour’s from earlier in question time, to allow the referendum to be delayed until the next election in exchange for the Government suspending the asset sales until we have that debate at the next election, alongside the referendum, where the people of New Zealand will get to decide whether the asset sales proceed?

Hon TONY RYALL: No, because the Government wants to proceed with its programme. It is fundamental to two important areas. One is that it helps New Zealand control debt, and the second is that it provides us with the resources to invest in important social infrastructure: Christchurch Hospital, roading projects, the 21st century schools project, and the justice precinct in Christchurch. They are important investments that will benefit New Zealanders, and that is why we are determined to keep on with our programme.

Dr Russel Norman: Is the Minister aware of Treasury’s projection that the Government’s operating balance is worse off by about $100 million a year as a result of asset sales; and, hence, why is the Government determined to go ahead with these asset sales in spite of the blowout in the cost—well over $100 million—the ongoing loss of net profits, overwhelming public opposition to it, and the failure of the Mighty River Power float, which attracted fewer than half of the Minister’s predicted retail investors?

Hon TONY RYALL: I really would dismiss that member’s characterisation of a number of issues. The Mighty River Power sale has actually been quite successful. The Government has $1.7 billion in cash and 113,000 shareholders, despite the economic sabotage of the members opposite. The important reason why we are doing this is that it not only helps control debt, it provides us with the resources to invest in important social infrastructure like Christchurch Hospital. If that member is opposed to the Christchurch Hospital rebuild, I invite him to go to Christchurch and tell them that. I invite him to also say why he is opposed to investing $1 billion in 21st century schools. That is of real benefit to New Zealand families.

Aged Care, Residential—Malvina Major Retirement Village

7. Hon PETER DUNNE (Leader—United Future) to the Associate Minister of Health: What specific “corrective actions” will the Malvina Major Retirement Village be required to undertake, following the recent Ministry of Health spot audit?

Hon JO GOODHEW (Associate Minister of Health): Ryman Healthcare Ltd, the owner of the Malvina Major Retirement Village, is required, after an unannounced inspection on 30 July this year, to undertake corrective actions to ensure improvement and compliance with the Health and disability services (general) Standards in the following areas: management and documentation of complaints; quality and risk management; processes for infection prevention and control; assessment of residents; care planning specific to individual residents; and the overall standard of care provided to residents. These corrective actions must be achieved within the specified time frames set out in the provider’s certification schedule. The first due date for corrective actions is 5 September 2013, but the provider may implement corrective actions ahead of the required time frame. The Ministry of Health and the Capital and Coast District Health Board are monitoring progress. The full list and detail of corrective actions are contained in a six-page document, which can be found on the Ministry of Health’s website.

Hon Peter Dunne: How will the actions that have been agreed to be monitored to ensure that they are actually achieved within the time frames that have been specified in the audit that the Minister referred to?

Hon JO GOODHEW: The Ministry of Health will be closely involved in monitoring the changes required of Ryman Healthcare in light of this distressing case. The distressing events were found by inspection to have been substantiated. Steps to ensure improvements and a time frame for change have been made clear, and the district health board will work with Ryman Healthcare to ensure their implementation. The ministry also keeps a close eye on progress. If the corrective

actions are not achieved, the ministry may take action under the Health and Disability Services (Safety) Act 2001.

Hon Peter Dunne: In light of this distressing case, will the Ministry of Health be making any changes to its overall auditing procedures to ensure that these types of situations can be prevented from recurring in future instances?

Hon JO GOODHEW: Since National came to Government back in 2008, we have taken a number of initiatives, including the publication of audit summaries online, introduction of spot audits, and third-party accreditation of auditors. We are also rolling out a comprehensive assessment tool. It would be fair to say that despite all of that, when a certification audit happens and midway between that—the audits can in fact be given a 1-year certification, right up to a 4-year certification; that will give you an idea of how many actions need to be changed. Midway, there is a spot audit as well. Despite that, things can still go wrong in rest homes; therefore, we very much rely on the public to contact the Ministry of Health or their district health board if they are concerned about anything, because something could go wrong the day after an audit is conducted. So this is very much a partnership between the public and the audit and regulatory environment.

Primary Industries, Minister—Statements

8. Hon DAMIEN O’CONNOR (Labour—West Coast - Tasman) to the Minister for

Primary Industries: Does he stand by all his statements?

Hon NATHAN GUY (Minister for Primary Industries): Yes.

Hon Damien O’Connor: Does he stand by his statement on Television New Zealand’s Q+A on Sunday that “the budget is up this year by $35 million for MPI. At the end of the day, the merger has helped the MPI to respond in this particular situation, because you’ve got a lot more technical resources there available, whether it’s scientists, whether it’s compliance officers, whether it’s policy guys.”?


Hon Damien O’Connor: I seek leave to table a paper from the Parliamentary Library that outlines departmental output expenses from 2008-09 to 2013-14. It identifies a $26 million cut to the budget.

Mr SPEAKER: Leave is sought to table that table prepared by the library. Is there any objection to that course of action? There is objection.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. My colleague the Dr Nick Smith said that the member was misrepresenting the Parliamentary Library. He is not allowed to accuse a member of the House of misrepresenting anyone.

Mr SPEAKER: Order! That is not a point of order.

Hon Damien O’Connor: Point of order—sorry. Supplementary question, Mr Speaker.

Mr SPEAKER: Supplementary question, the Hon Damien O’Connor.

Hon Damien O’Connor: Thank you, Mr Speaker. I apologise. I sometimes cannot the member over there. Thank God. Why did the Minister choose to caution me last week when he must have known full well that his ministry had failed to certify meat from the Alliance Group meatworks in Pukeuri for export to China?

Hon NATHAN GUY: To put the record straight, the Alliance Group plant in Pukeuri had two separate problems. The first in early July related to it incorrectly exporting a small part of consignment to China from facilities that were not listed by the Chinese authorities. That is the first point. The second, later problem arose due to Alliance Group not labelling product in accordance with Chinese requirements. In both cases the Ministry for Primary Industries had to suspend certification. The plant has now been processed through an audit, and the Ministry for Primary Industries and the Chinese authorities are now working on lifting the export listing suspension. I fully appreciate the difficult situation the workers have found themselves in.

Hon Damien O’Connor: Will workers from Alliance Group’s Pukeuri plant be able to claim compensation for lost wages from his ministry stuff-up and the 3½ weeks it took the company and his ministry to sort it out?

Hon NATHAN GUY: If the member was listening, I have just told him that this was an error as a result of the Alliance Group plant.

Hon Damien O’Connor: Has the merger at the Ministry for Primary Industries led to confusion as to what is fish and what is livestock, or might it, in fact, be that either the samples provided to EcoGene were incorrect or that the technology available to it to correctly differentiate sheep DNA from fish DNA was simply not adequate?

Hon NATHAN GUY: The DNA testing was conclusive: three out of four samples conclusively indicated that the material was from a sheep leg. The fourth test was done using poor quality material and came up with a false result. If the member wants to walk outside and tell everyone that fish have legs, I welcome him doing that.

Hon Damien O’Connor: I seek leave to table two reports. The first from EcoGene identified that five—not four—samples were actually provided to it and that it identified four of them—

Mr SPEAKER: Order! Leave is sought to table the EcoGene report. Is there any objection? There is none. Document, by leave, laid on the Table of the House.

Hon Damien O’Connor: I seek leave to table another report from the Ministry for Primary Industries that is an assessment of the limb found in palm kernel expeller—

Mr SPEAKER: Leave is sought to table that Ministry for Primary Industries report. Is there any objection? [Interruption] Order! I am putting the leave as to whether people want that document tabled. It is a Ministry for Primary Industries analysis. Is there any objection to that being tabled? No, there is not. Document, by leave, laid on the Table of the House.

Hon Damien O’Connor: Has the failure of his ministry to differentiate between—[Interruption]

Mr SPEAKER: Order! A bit of silence from both sides of the House would be helpful to the Hon Damien O’Connor to—[Interruption] Order!

Hon Damien O’Connor: Has the failure—[Interruption]

Mr SPEAKER: Order! I have just cautioned members to be quiet and that includes the Hon Clayton Cosgrove, who continues to interject. If he does that again, I will be asking him to leave the Chamber for the rest of the day.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. My colleague responded to Anne Tolley and you did not admonish her.

Mr SPEAKER: I did not hear that, but I heard Clayton Cosgrove and—[Interruption] Well, I can tell the member now that his interjecting while I am on my feet will get the same sort of reaction that the Hon Clayton Cosgrove has lined himself up for.

Hon Damien O’Connor: Has the failure of his ministry to differentiate between a sheep and a fish led to his new-found oversight by the Hon Steven Joyce MP, BSc in zoology, or is this oversight, in fact, a result of his incompetence in growing and protecting New Zealand’s primary industries?

Hon NATHAN GUY: If the member wants to argue with independent science from EcoGene— DNA science—well, I welcome him to step out there and do that, because he is wrong.

Education System—Reports

9. SIMON O’CONNOR (National—Tāmaki) to the Minister of Education: What recent announcements has she made on how the education system is performing at a local level?

Hon HEKIA PARATA (Minister of Education): New Zealand has a world-class education system, and one of the ingredients to keep it that way is a data-rich environment that enables parents and communities to work with their schools to ensure all our children succeed. It is important to make public achievement information as meaningful and as helpful as possible. For that reason, we have already released national and regional education profiles, and, today, school-by-school data, which is being released for a second time. In addition, I am releasing for the first time education profiles at territorial authority level. Together, this data tells us how our education system is performing at national, regional, and local levels. This information allows parents and communities to have a fuller picture of how their children are doing at school and provides valuable data that helps to engage the entire community in how to support our early childhood educators and schools to be effective in raising achievement. Five out of five children and young people succeeding in education is in the interests of all New Zealanders, and we can all work together to ensure that.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. The question that was asked by Mr Simon O’Connor was: “What recent announcements …”. The Minister has had tons of time to announce whatever those announcements were or to repeat them, but not to go on and on, trying to sell them, which was not part of the question. That is the issue here.

Mr SPEAKER: The member makes a reasonable point. It was a very long answer. I was about to get to my feet, as the member did, to say that it was long enough.

Simon O’Connor: How does the education data at the regional council and territorial authority level contribute to lifting achievement in education?

Hon HEKIA PARATA: This Government has an unrelenting focus on raising achievement for all children and young people. Making public achievement information available at different levels is about rallying people around a focus on raising achievement. Lifting this achievement must not be left as the sole responsibility of individual teachers in schools; we must all make a contribution.

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

Hon HEKIA PARATA: That includes—

Mr SPEAKER: Order! I apologise to the Minister. There is a point of order from the Hon Trevor Mallard.

Hon Trevor Mallard: The question was about data. We have now gone, I think, about half a minute into an answer, and data has not been mentioned.

Mr SPEAKER: I am certainly hopeful that the question is about to be answered. Would the Hon Hekia Parata please continue with her answer.

Hon HEKIA PARATA: Yes. Public achievement information includes a range of data at local, regional, and national level, and it is important that that is available so that schools alone are not left with the responsibility, but so that community leaders, business owners, and parents can also help. For some this will be challenging, as our pictures of achievement do not show uniform success everywhere. The driver for providing this information is to empower all of us to take action to raise achievement for five out of five of our children and young people.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. I know I complained about the answer to the question sort of going on at the beginning, but I am now going to ask whether the Minister can answer the question again so that there is actually an answer to the question that was asked. I know—

Mr SPEAKER: Order! I have heard enough from the member. I am calling for a supplementary question from Simon O’Connor. But in the meantime, the point has some validity, so if the member wants to sharpen up and think of a supplementary question, I am going to give him one.

Hon Trevor Mallard: A spare one?

Mr SPEAKER: Yes, a spare one.

Simon O’Connor: Why is the ministry releasing financial information about individual schools?

Hon HEKIA PARATA: This Government has increased its investment in Vote Education every year for the past 5 years. Schools received $5.8 billion this year—

Hon Annette King: That’s not the question asked.

Hon HEKIA PARATA: —an increase of 30 percent, which is financial information. Parents also contribute further to the education of their children and young people through donations. In 2010 and 2011, the amount schools—

Hon David Parker: I raise a point of order, Mr Speaker.

Hon HEKIA PARATA: —received in donations—

Mr SPEAKER: Order! [Interruption] Order! I have a point of order. I am sorry to interrupt the Minister.

Hon David Parker: It is a very similar one to those raised by the Rt Hon Winston Peters and the Hon Trevor Mallard. The answer is not addressing the question that was asked by her member of her.

Mr SPEAKER: Well, to be honest, I think that as the member rose to his feet we were starting to get an answer to the question. Could the Minister please continue with the last part of her answer.

Hon HEKIA PARATA: Yes. I wanted to confirm to the House that the Government is releasing financial information about schools because it reflects the overall investment this Government has made—including, in this year, $5.8 billion—and, in addition, from parents and donations, about 1.8 percent of that total amount.

Hon Trevor Mallard: What is the difference between data and information?

Hon HEKIA PARATA: Data is individual bytes that when put together create an information picture. Data and information can be used in different ways in different contexts, but unless the person receiving them understands them, it is quite difficult to make that distinction.

Health, Minister—Statements

10. Hon ANNETTE KING (Labour—Rongotai) to the Minister of Health: Does he stand by all his promises in health?

Hon TONY RYALL (Minister of Health): Within contexts, and this includes providing more front-line staff, including 2,500 more nurses across our district health boards compared with 2008, and investing an average extra $500 million a year over the past 5 years into the New Zealand public health service.

Hon Annette King: Does he recall saying just a few minutes ago that in Government you are expected to honour the pledges of your campaign; if so, why has he not honoured the pledge to continue Labour’s health spending growth track made by him after the global financial crisis had started and after the pre-election fiscal update, and does his broken pledge account for district health boards now cutting important health services?

Hon TONY RYALL: I think the member will find that Labour’s spending path was certainly replicated in the 2009 Budget, when we had a $750 million increase. But what the member has to remember is that this party pledged to continue investing strongly in the New Zealand public health service and we have had $500 million a year, on average, during the most difficult economic times.

Hon Annette King: I seek leave to table health policy part 1, which says that they will continue funding the current health spending—

Mr SPEAKER: Order! The source of the document?

Hon Annette King: This is the National Party’s pledge that the Minister seems to have forgotten.

Mr SPEAKER: No. No, if members want to look that up, they can certainly find it.

Hon Annette King: Is he aware that the chief executive officer of Hawke’s Bay District Health Board said last week that his board is getting its lowest funding for “many years”, it is going to be “a tough year”, and the standard of some services will have to be adjusted, and access to some modified, with $16 million to be shaved off this year’s budget to meet the Minister’s expectations, and is that what he promised the people of Hawke’s Bay in 2008 and 2011?

Hon TONY RYALL: What I promised the people of Hawke’s Bay in 2008 is that I would restore their democratically elected health board that was summarily dismissed by the Labour Party health spokesman whom that member is actively campaigning against presently.

Hon Annette King: I raise a point of order, Mr Speaker. My question had nothing to do with sacking a district health board in 2008.

Mr SPEAKER: Order! I invite the member to go back. She asked a long question and the Minister has chosen to quite adequately address the second part of the question that was asked.

Hon Annette King: Is he aware that the Hawke’s Bay District Health Board intends to cut nearly $700,000 in funding for Māori health over the next financial year in a region where Māori have the lowest life expectancy at birth of any health districts, where the prevalence of diabetes is twice that of all New Zealand enrolees, where the Māori mortality rate is twice that of non-Māori, and serious mental health illness is 25 percent higher than the national average, and is that what he promised his coalition party the Māori Party?

Hon TONY RYALL: What I know is that the Hawke’s Bay District Health Board has received an extra $9 million in this year’s Budget; that is $73 million under this Government. And what I can say is that the Hawke’s Bay District Health Board’s Māori immunisation rate is now, I think, the same as the Pākehā immunisation rate. That was something that that member could never achieve. The work that they are doing on heart and diabetes checks is a significant lift in the level of service being provided to Māori there, and there is a very significant improvement in smoking cessation rates amongst Māori in Hawke’s Bay. So we are putting more money in. We are delivering better services for Māori and all other New Zealanders, and in particular the people of Hawke’s Bay.

Hon Annette King: I raise a point of order, Mr Speaker. If you were listening carefully to the question, I asked whether he was aware that nearly $700,000 was being cut out—

Mr SPEAKER: Order! [Interruption] Order! The member will resume her seat. It was a very long-winded question and I think the member adequately addressed parts of it.

Hon Annette King: Is he aware that Hawke’s—

Hon David Parker: I raise a point of order, Mr Speaker. I would ask the Speaker to reflect on his tone when he dresses down an Opposition member—he calls them long-winded. When the Minister of Education gave repeatedly long answers, he did not use language that was nearly as critical of Government members. I would ask that there be a bit of equality shown across the sides.

Mr SPEAKER: I will certainly endeavour to do that, but I remind members, and I have attempted on many occasions to assist members, that, when they ask supplementary questions, if they make them short and pithy, then they and I can assist to get them a far better quality answer.

Hon Annette King: I seek leave to table a fact sheet from Ngati Porou Hauora 2013 that sets out all the appalling health statistics that I have just said in a question that the Minister then on went on to totally ignore in his answer.

Mr SPEAKER: Leave is sought to table that Ngati Porou health facts sheet. Is there any objection to that being tabled? It can be so tabled. Document, by leave, laid on the Table of the House.

Hon Annette King: Is he aware that the Hawke’s Bay District Health Board intends to cut over $1 million from mental health funding this financial year to local service providers and out-ofregion services, and $795,000 from the disability support budget, which is funding that is provided to community organisations?

Hon TONY RYALL: The information that I have been provided about mental health spending in the Hawke’s Bay is, in fact, that the district health board does expect to spend more in terms of the mental health ring fence this year compared with the previous year. Of course, it will be moving its funding within its various spending priorities, but what I can assure the member of is that we have given it more money this year. The Hawke’s Bay District Health Board’s budget is the highest it has ever been, and I have got to say that I think it is providing very good services for the people

of Hawke’s Bay. It has been backed up by significant capital investments that we are making in terms of improved mental health services and the Wairoa integrated family health centre.

Hon Annette King: I seek leave to table page 35 of the district annual plan of the Hawke’s Bay District Health Board showing that $1 million is to be cut from mental health funding.

Mr SPEAKER: Leave is sought to table that particular page, page 35. Is there any objection to it being tabled? There appears to be none. It can be tabled. Document, by leave, laid on the Table of the House.

Television, Switch-over to Digital—Progress

11. KATRINA SHANKS (National) to the Minister of Broadcasting: What progress has been made on the regional rollout of the digital switchover for New Zealand television viewers?

Hon CRAIG FOSS (Minister of Broadcasting): Excellent progress has been made on the digital switch-over, which is a key part of the innovation work stream of our Business Growth Agenda. Hawke’s Bay and the West Coast were the first regions to go digital in September 2012, and the rest of the South Island followed in April this year. The lower North Island, including Taranaki and the Gisborne district, go digital on 29 September 2013—just 26 days away—and the rest of the North Island follows on 1 December. Out of the 1.2 million homes in the North Island with TVs, it looks like there are about only 87,000 homes that are yet to go digital.

Katrina Shanks: How can people find out more information on whether they need to go digital?

Hon CRAIG FOSS: The good news is that—[Interruption]

Mr SPEAKER: Order! [Interruption]

Hon CRAIG FOSS: May I start again, Mr Speaker?

Mr SPEAKER: You may.

Hon CRAIG FOSS: The good news is that viewers watching this programme right now, live, have already gone digital, but I urge people to check that their friends, families, and neighbours are sorted also. Anyone needing information about going digital, go check out and talk to some of the representatives in the community, or go to or call 0800 838 800.

Syria, Internal Conflict—Government Response

12. Dr KENNEDY GRAHAM (Green) to the Prime Minister: Will he support a parliamentary debate and vote on any Government decision to give moral support for a United States - led military strike on Syria; if not, why not?

Hon TIM GROSER (Minister of Trade) on behalf of the Prime Minister: I will repeat what the Prime Minister said yesterday. Should action be taken against Syria, it is the intention of the Government that a ministerial statement will be given to the House at the appropriate time. As the member knows, that would then allow the House and the member to make any statement that they wish to make.

Dr Kennedy Graham: What issue would justify a democratic parliamentary vote, if not one in which New Zealand gives support to an unauthorised military strike by the US?

Hon TIM GROSER: In this evolving situation I would not wish to speculate on what kind of action might or might not be justified.

Dr Kennedy Graham: Does the Prime Minister agree that it is essential to wait for the evidence supplied to the United Nations Security Council by the UN weapons inspectors on the use of chemical weapons in Syria, given the debacle over evidence supplied by the US back in 2003 over Iraq’s weapons of mass destruction?

Hon TIM GROSER: Clearly, the weapons inspectors’ reports will be a crucial ingredient in the matter. All of our focus at the moment is to try to work with the Security Council to try to get the Security Council to come together and take decisive action. That is the immediate focus.

Dr Kennedy Graham: Does the Prime Minister recognise that the legal justification that the US is preparing for a strike, pertaining to the “responsibility to protect” doctrine, is designed to apply only to the protection of civilians, not for punitive strikes?

Hon TIM GROSER: All of our attention is on trying to ensure that the UN Security Council comes together at this hour of great need. There are a number of legal questions, about which I think it would be highly irresponsible to enter into speculative discussion.


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