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Questions and Answers - Sept 16

Questions to Ministers

Labour Market—Incomes and Resilience

1. DAVID BENNETT (National—Hamilton East) to the Minister of Finance : How is New Zealand’s labour market supporting resilience and delivering higher incomes for families?

Hon BILL ENGLISH (Minister of Finance): Our economic resilience depends in part on a well-functioning labour market. The current participation rate, at 69.3 percent, is the third-highest on record. New Zealand’s employment rate—that is, the share of the working-age population in employment—is among the highest in the OECD, at 65.2 percent. Our labour market is also delivering higher take-home pay for New Zealand families. Average wages rose 3.2 percent in the year to June, well above the inflation rate of 0.4 percent.

David Bennett : What reports has he received showing how the Government’s tax reforms are supporting more jobs and higher incomes from work?

Hon BILL ENGLISH : Last week Treasury released a working paper looking at the effects of the Government’s 2010 tax package, which reduced income tax and increased GST. Treasury referred to a number of effects—first, that the package increased labour market participation and increased the average hours of work a week; secondly, higher labour supply reduced the annual cost of income tax reduction to welfare spending by up to $230 million. The working paper also found that the tax package was approximately distributionally neutral, as measured by the Gini coefficient.

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David Bennett : Who benefits most from the 2010 tax package through better labour market outcomes?

Hon BILL ENGLISH : Treasury found that the net effect of the tax package was a moderate improvement in labour market participation and a lift in ours by all groups that were examined. The strongest improvements were for single women and, in particular, sole parents, whose participation rate increased by nearly 1 percent as a result of the tax reform, according to the Treasury study.

David Bennett : What additional steps is the Government taking to support more jobs and higher wages?

Hon BILL ENGLISH : We intend to stay on track with our existing policy, and in particular to refresh the Business Growth Agenda, which has proven to be a very successful way of consistently interacting with businesses over what is going to build their confidence to invest another dollar and employ another person. We have already issued a couple of refreshers of the Business Growth Agenda, and we will be issuing more over the coming months.

Grant Robertson : Was per capita GDP negative in the last quarter?

Hon BILL ENGLISH : I think the member has pointed out before that it probably was negative in the last quarter. But, of course, this Government does not focus on quarter-to-quarter numbers, because we cannot influence them. We take a longer-term view about lifting the productivity of New Zealand businesses and the resilience of our economy.

Grant Robertson : If the Minister does not focus on quarterly figures, can he confirm that the Reserve Bank slashed a third of its forecast growth in its report last week for an annual figure?

Hon BILL ENGLISH : The Reserve Bank did reduce the forecast of growth because the signs are that the economy will grow more slowly. It did reduce those forecasts from pretty high levels, and it is showing 2 to 2.5 percent growth over the next 12 months, which is moderate. But in the context of rapidly dropping dairy prices, actually it is not a bad result for this economy, if that is what is achieved, because other parts of the economy are growing—for instance, the manufacturing sector is in its 36th month of continuous expansion.

Mr SPEAKER : Before I call the next question—[Interruption] Order! Before I call the next question, would Mr Seymour please remove that visual aid from his desk.


ANDREW LITTLE (Leader of the Opposition): My question is to the Prime Minister and asks: why did he say—[Interruption]

Mr SPEAKER : Order! The level of interjection—particularly from the far-left corner but not only from the far-left corner—again goes back to the territory we were in last week. After my specific ruling yesterday, members, be warned that I will not be that patient.

2. ANDREW LITTLE (Leader of the Opposition) to the Prime Minister : Why did he say in July last year that “We think unemployment will be down to 4.5 percent in the very foreseeable future”, given unemployment has risen in each successive quarter, and now stands at 5.9 percent?

Rt Hon JOHN KEY (Prime Minister): Because the best information at the time, which was the Treasury 2014 Budget forecast, showed unemployment dropping to 4.5 percent over the forecast period.

Andrew Little : Can he confirm that he predicted 4.5 percent unemployment, which did not happen, but failed to predict the economic slow-down that is happening right now?

Rt Hon JOHN KEY : No. I can predict that Treasury did that.

Andrew Little : Does the fact that there are 13,000 more people out of work today than a year ago suggest that a new economic plan is needed, and if so, is he now working on plan B, or is that Treasury’s job, too?

Rt Hon JOHN KEY : I think the member’s ability to analyse the data is not that good. There are 68,000 more people who have been employed over the last 12 months.

Andrew Little : Does he think that business owners in the ANZ confidence survey are wrong when they say that unemployment will rise in the next year, and if so, what does he know about their businesses that they do not?

Rt Hon JOHN KEY : They may be right or they may be wrong—I mean, they are simply having a forecast. Interestingly enough, if you look at the ANZ Business Outlook survey, when it comes to its own business it is a lot more confident, actually, about its own level of activity than others’. Interestingly enough, I think it was about 6 weeks ago that we came into this House and the Labour Party was doing its very, very best to talk dairy prices down to zero, but, by the way, the prices are up 56 percent in 6 weeks.

Mr SPEAKER : Order! That is actually not relevant to the question that was asked.

Andrew Little : Putting aside his repeated claims that it is the Labour Party that is responsible for everything, and given the Reserve Bank forecasts a further 5,000 Kiwis will be unemployed by March next year on top of the 50,000 more people unemployed since he came to power, what new plans does he have to get Kiwis back into work?

Rt Hon JOHN KEY : The member’s data is wrong. There are hundreds of thousands more New Zealanders in employment now than when this Government came into office. But here is a suggestion: if the Labour Party wants to see more people in work, support the Trans-Pacific Partnership and stop trying to reverse the 90-day probationary period.

Andrew Little : Does he understand that while he buries his head in the sand and promises jam tomorrow, real Kiwi families are struggling with rising unemployment and the fear of losing their jobs?

Rt Hon JOHN KEY : I will take those as crocodile tears from the Leader of the Opposition, because this Government is a Government that has gone out there and cut ACC levies.

Hon Members : Ha, ha!

Rt Hon JOHN KEY : This is a Government that has gone out there and extended ultra-fast broadband—well, yes, that is right. We would have laughed too at the state the Labour Government left ACC in, but it was such a disgrace we had to clean it up for them.

Mr SPEAKER : Order! Supplementary question, Andrew Little. [Interruption] Order! I have called Andrew Little.

Andrew Little : As he enters his 8th year in Government, when is he going to stop blaming an old Government and take responsibility for his own actions?

Rt Hon JOHN KEY : Given the damage that was done in the 9 long years under Helen Clark, it has taken a while to tidy things up. There is a reasonably case to be made that when people come to Parliament in Opposition screaming their lungs out after 9 years of Government that completely and utterly failed this country, they are held to account. By the way, that will probably carry on for many more years to come.

Mt Eden Corrections Facility—Serco’s Management

3. DAVID CLENDON (Green) to the Minister of Corrections : What was the reason for issuing each of the seven performance notices to Serco, which were then withdrawn; and what was the dollar amount for each of those notices?

Mr SPEAKER : Before I call the Minister, my office has been advised this answer may be longer than normal.

Hon Peseta SAM LOTU-IIGA (Minister of Corrections): Performance notices can be issued for many different reasons by the Chief Executive of the Department of Corrections under the contract to hold Serco to account for its performance at Mt Eden Corrections Facility. Since the start of the contract, 55 notices have been issued for that reason. The seven notices that were issued and then withdrawn were for the following reasons: unlawful detention of a prisoner, $25,000; adherence to search plans, $50,000; incident and contingency protocols, $50,000; compliance with programme delivery plan, $50,000; compliance with Parole Board reports, $50,000; rate of serious assaults, $50,000; and compliance with initial health screening, $0. There are serious issues, but I am advised that five of the notices were withdrawn because clause 25 of the contract allows Serco to address the issues raised, improve its performance, and provide mitigating circumstances for the Department of Correction’s consideration. It is then for the chief executive to make a decision on the final outcome of each notice. Five notices were withdrawn as the required improvements had been made, one notice was withdrawn as it was an error of the court, not Serco, and one was withdrawn as it was a duplicate of a previous notice.

David Clendon : Does the fact that the Minister, when questioned in the House yesterday, was not aware of a $100,000 penalty that had been withdrawn indicate a dysfunctional relationship between the Minister and the Department of Corrections?

Hon Peseta SAM LOTU-IIGA : To the contrary, actually, because the member is confusing two different issues: that is, notices that were issued and withdrawn, which I have just alluded to, and notices that were upheld but no specific deduction was made. The former notices—“written notices” means that Serco provided mitigation information and evidence considered to be robust to support the withdrawal of the notice. The notices that Mr Clendon refers to—the $100,000—are performance notices that have been upheld by the department where Serco has been held to account and has rectified the issues and put in place a regime that met the department’s expectations. The two are very separate.

David Clendon : Does the Minister, then, express his support for decisions being made by the Department of Corrections to withdraw financial penalties issued to Serco, even where breaches are being upheld; if so, why?

Hon Peseta SAM LOTU-IIGA : As I have said, the contract provides for Serco to mitigate certain circumstances and situations, for it to present evidence that is contrary to the breach notice. That is under the contract. I do not, as the Minister, stipulate what is in that contract. It is there for both parties to meet the terms of that contract.

David Clendon : Given that 14 of the 55 performance notices issued have been issued in the last year, six of which were upheld, how many more breaches does Serco have to be guilty of before a final warning is issued?

Hon Peseta SAM LOTU-IIGA : As I have said time and time again, in terms of final notices and terminations, it is prudent to wait for the investigation that is currently being undertaken by the chief inspectorate.

David Clendon : Given that Serco is running Mt Eden prison in order to make a profit, why are very serious contract breaches nevertheless being excused and financial penalties withdrawn?

Hon Peseta SAM LOTU-IIGA : That is done on a case by case basis by the chief executive. He makes that call. In terms of the contract, they must follow clause 25 of the contract, and I say to that member that he should go and read clause 25, because clearly he misunderstands it.

David Clendon : In light of recent events, does the Minister agree with former Minister of Corrections Judith Collins, who said in 2010, when Serco won the contract: “I’m confident that the company will bring the high standards of professionalism, safety, rehabilitation, and security expected by the Government to Mt Eden.”?

Hon Peseta SAM LOTU-IIGA : I, like all Ministers of the Crown, have high expectations around contractors that provide services to the Government.

David Clendon : I raise a point of order, Mr Speaker. I am still unsure from the Minister’s answer whether he agrees with the sentiments expressed in that quotation.

Mr SPEAKER : No, I thought the answer addressed the question.

David Clendon : Does the Minister believe that his performance in managing the many problems at Mt Eden will give the public confidence that our prisons are being managed safely and efficiently?

Hon Peseta SAM LOTU-IIGA : Yes. I wish to table a performance notice summary of Mt Eden’s corrections performance notices, for all the notices that have been issued.

Mr SPEAKER : Is it something that is available to members on the internet?

Hon Peseta SAM LOTU-IIGA : No, it is not; it is—

Mr SPEAKER : Then I will put the leave. Leave is sought to table that particular information. Is there any objection? There is none. It can be tabled. Document, by leave, laid on the Table of the House.

Tertiary Education—Study Decisions

4. MELISSA LEE (National) to the Minister for Tertiary Education, Skills and Employment : How is the Government helping students make more informed tertiary study decisions?

Hon STEVEN JOYCE (Minister for Tertiary Education, Skills and Employment): On Monday I announced that from 2017 all universities, wānanga, and polytechnics will be required to publish information about the employment status and earnings of their graduates, broken down by specific degrees and diplomas. The employment status and earnings data is taken from Statistics New Zealand and is gathered by matching information, on a confidential basis, from the Inland Revenue Department with tertiary qualifications. Students and their families consider many things when deciding what to study and where, but we know that most students expect that their tertiary study will get them a job and improve their career prospects. As New Zealand continues to become more highly skilled it is more important than ever for students to consider carefully their tertiary study options.

Melissa Lee : How will the information help students make better decisions?

Hon STEVEN JOYCE : Students have been able to compare earnings by qualification and field of study at a national level since 2013. From 2017 they will be able to compare graduates’ employment status and earnings by provider as well. This will let students see whether employers prefer graduates from particular providers, and let them compare what and where to study in order to improve their employment prospects. That information helps ensure that the skills people develop in tertiary education are matched to the labour market needs. Tertiary education providers are increasingly working with industry to ensure that this happens, and this information will help them do that.

Melissa Lee : What other initiatives are under way to improve information availability for students?

Hon STEVEN JOYCE : We have taken a number of steps to provide students with more and better information to help them with their study decisions. Students can now compare earnings by qualification and field of study on the Careers New Zealand website, and download the occupational outlook app, which gives them an easy-to-use overview of job demand, their likely income levels, and training requirements. Next year we also intend to introduce Rate My Qualification, which will let employers provide direct feedback to tertiary providers and students about the qualifications that they value. These initiatives, taken together, will ensure that students make the most of their very significant investment in tertiary education—for the time and the money they invest in their programmes.

Prime Minister—Statements

5. FLETCHER TABUTEAU (NZ First) to the Prime Minister : Does he stand by all his statements?

Rt Hon JOHN KEY (Prime Minister): Yes.

Fletcher Tabuteau : If the Prime Minister believes that it is good that a Chinese State-owned enterprise is buying half of Silver Fern Farms, how does he respond to Alliance Group chairman Murray Taggart, who said that it was important for New Zealand farmers to retain ownership of their industry?

Rt Hon JOHN KEY : With the greatest respect, he is a competitor, and in the private sector we tend to listen to the shareholders of the company, not the competitors of the company, about whether something is good or bad for them.

Fletcher Tabuteau : How does the Prime Minister respond to concerns that this company has such deep pockets it will outbid New Zealand companies for livestock and very quickly force New Zealand meat processors out of business?

Rt Hon JOHN KEY : I would take all of that with a grain of salt. I did watch the news last night and I think—yes, if you look at Television One’s coverage of the issue, they interviewed what seemed to be an imminently sensible farmer down south, who said she looked forward, actually, to the road shows and to hearing the good things that might happen, and this was a company that had gone from being massively indebted to potentially having cash in the bank and being ready to invest in New Zealand. I would have thought that is good for New Zealand—jobs and opportunities for our farmers.

Fletcher Tabuteau : Who is correct here: is it the Prime Minister saying that the Government was never approached by Silver Fern Farms, or his Minister of Finance, who avoided meeting them for a year on potential investment questions? That sounds like the Government was—

Mr SPEAKER : Order! The question has been asked.

Rt Hon JOHN KEY : I do not think—I never said that. I think the member asked me the question yesterday, and I said that I have not been approached by them on this particular issue. Other Ministers, maybe, but I do not run the diary of every Minister in Cabinet, otherwise I would be very, very busy.

Hon Gerry Brownlee : I wonder whether the Prime Minister would speculate on whether higher competition for stock in New Zealand leads to higher prices for New Zealand farmers.

Rt Hon JOHN KEY : Firstly, can I say that that is the best question I have had in the House all—

Mr SPEAKER : Order! Just answer it.

Rt Hon JOHN KEY : I will answer. The answer, in a word, is yes. I could hold up a sign that would say that, but the expert at holding up signs is in London at the moment—

Mr SPEAKER : Order!

Richard Prosser : I raise a point of order, Mr Speaker. I do believe that it is against the Standing Orders to refer to the absence of a member.

Hon Gerry Brownlee : Mr Speaker—

Mr SPEAKER : I will hear from the Hon Gerry Brownlee.

Hon Gerry Brownlee : Well, unfortunately for that member, the member who is being spoken of is actually considered to be in the precincts of Parliament during this 2-week period, while in fact he is in London swanning around as the media—

Mr SPEAKER : Order! [Interruption]. The question is actually—

Fletcher Tabuteau : If the Chinese Government, through this company, owns half of Silver Fern Farms, can the Prime Minister assure Kiwi meatworkers that they will not simply be replaced by Chinese workers under the Chinese free-trade agreement temporary employment entry criteria?

Rt Hon JOHN KEY : I would have thought that as highly unlikely in the same way that when Bright Dairy and Food came into New Zealand and bought a big chunk of, I think, Synlait, it did not replace New Zealand workers. The last time I looked, actually, under the same free-trade agreement that he is talking about, given that Fonterra has bought a big chunk of Beingmate, I have not noticed a fast track of New Zealand workers going over to work in China. We have had foreign investment in this country for decades. For the most part it has been highly successful in transforming New Zealand and allowing us to have businesses with stronger capital bases. In the end it is for the owners of Silver Fern Farms to decide whether they want this, not the Government. We do not own Silver Fern Farms, although we accept that if New Zealand First had its way, we would own everything in New Zealand. [Interruption]

Mr SPEAKER : Order! [Interruption]. Order! That is the sort of interchange we are not going to see happening in this House.

Building and Construction Industry—Building Consents in Auckland

6. KANWALJIT SINGH BAKSHI (National) to the Minister for Building and Housing : Can he confirm that the 1,116 building consents issued in July in Auckland, and the 8,567 for the latest year, are the highest in 10 years, and what further steps is he taking to ensure the new build rate of houses in Auckland continues to grow?

Hon Dr NICK SMITH (Minister for Building and Housing): Yes, building is at a faster rate than for a decade, and the initiatives that the Government has taken with the housing accord and special housing areas are bearing fruit. The house build rate in Auckland has grown by rates of 29 percent, 31 percent, and 20 percent over the last 3 years, making it the longest and strongest building boom in Auckland’s history. The next hurdle is that the fast-track zoning powers of the special housing area law expire in October next year. It is crucial that we support Auckland in completing the unitary plan by then. That is why today I have announced further legislation to streamline that process and give the Auckland Council the tools to complete the new plan this council term.

Kanwaljit Singh Bakshi : What are the specific problems the Auckland Council and the independent hearings panel are incurring that require a law change to see this process completed in a timely way?

Hon Dr NICK SMITH : The hearing panel is doing a sterling job in preparing the biggest resource management plan covering one-third of New Zealand’s population in the fastest time ever. It has worked through thousands of submissions on the general planning policies but now has over 5,000 separate requests to be heard on site-specific property issues. The bill that I have announced will enable a lesser quorum of two panel members and extra panel members are to be appointed, it will enable multiple hearings to occur simultaneously, and it will also enable the panel to progressively report the plan to the council for its adoption, to ensure that it is completed next year.

Kanwaljit Singh Bakshi : What reports does the Minister have that indicate that the house build rate will continue to grow in Auckland?

Hon Dr NICK SMITH : The National Construction Pipelinereport prepared by the Building Research Association of New Zealand and Pacifecon is projecting a massive investment in new housing over the next 6 years. It projects 80,000 new homes being built in Auckland over that period, as compared with 30,000 over the past 6 years. I am particularly encouraged by the fact that this year’s report predicts a growth rate 26 percent faster than in its report of just 1 year ago. The challenge for the Government and the council is in streamlining the planning, resource, and building consent processes so that we also ensure the new communities and homes that are being built are of good quality.

Phil Twyford : Can he confirm that at the current build rate of only 8,567 consents per year in Auckland, based on the Productivity Commission’s analysis, the housing shortfall will grow from 32,000 last year to nearly 59,000 by 2020? And that is the Productivity Commission.

Hon Dr NICK SMITH : No. No, I do not accept that, and I do not accept the member’s analysis of the build rate. It is interesting to note that when Labour released its housing policy at the last election, it said that it would take it 5 years to grow the build rate to as fast as what we have achieved—i.e., the results that this Government has achieved over the last year. A 20 percent increase in build rate is significantly faster than what Labour’s own policy said that it could achieve.

Building Materials—Tariffs, Anti-dumping Duties, and Cost of Auckland Housing

7. PHIL TWYFORD (Labour—Te Atatū) to the Minister for Building and Housing : How much does the Ministry of Business, Innovation and Employment estimate has been saved on building materials for a standard home by the Government’s suspensions of tariffs and anti-dumping duties on building products, and, since its commencement in July 2014, by how many dollars has the price of the average Auckland home increased?

Hon Dr NICK SMITH (Minister for Building and Housing): The ministry stands by its estimate that the removal of tariffs and duties on building materials will save $3,500 on an average new home construction. The full benefits of this will take time to flow through because it takes time to set up new supply lines, it takes time to change New Zealand standards, and it takes time to become familiar with alternatives in the design of houses. It is simplistic and flawed to link the cost of building materials for new homes to the Quotable Value valuations for all homes, as 98 percent of them were actually built before the change was made. It is no more correct to blame the 20 percent increase in Auckland house prices that has occurred since July 2014 on the National Government than it is to blame the Labour Government for the 29 percent increase in house prices that occurred when Labour was in Government.

Phil Twyford : Can he confirm that the Ministry of Business, Innovation and Employment has advised that the savings from his scheme may be as low as $582 per house and that in general they have made “no discernible impact on prices”, while the average Auckland house price has gone up by over $150,000 in the same period, according to Quotable Value?

Hon Dr NICK SMITH : No, I do not accept the member’s claims. I would note that house prices doubled during the period of the previous Government, and it did not take a single step. The house build rate collapsed during Labour’s period to just 200 houses in a month. We have got over 1,100 homes built in the last month that has been reported.

Phil Twyford : Is he surprised that the consumer has seen none of the estimated savings of $2,500 on plasterboard despite falls in import prices; if so, why is he surprised, given that his own officials warned him that in an overheated market like Auckland, builders and developers would simply pocket those savings?

Hon Dr NICK SMITH : I note that since the Government made the changes, the import of plasterboard from Thailand has more than doubled. Secondly, I note that if we look at the Consumers Price Index around building materials, they grew by an average of 5 percent per year under the previous Government and they have grown by an average of 2 percent per year under this Government, showing that we have been far more successful in keeping building materials costs under control compared with the previous administration.

Phil Twyford : Why did he say: “I don’t have information that builders are being induced to buy a particular product.” when the Commerce Commission found that the Fletcher’s subsidiary Winstone Wallboards has agreements with all the major merchants that include kickback payments and one agreement that outright prevents the largest retailers stocking alternative brands?

Hon Dr NICK SMITH : The Commerce Commission undertook a comprehensive investigation into those allegations. It came to the conclusion that there was no breach of the law. The member’s comments have about as much hot air as similar claims that were made by the Opposition on supermarkets, which also came to naught.

Phil Twyford : Why has he been talking a big game on the high cost of building supplies for the last 3 years, while his main policy has resulted in zero savings for consumers, and meanwhile he has been ignoring the bigger issue, which is anti-competitive rorts in the building supplies market?

Hon Dr NICK SMITH : We should judge by results. Under the previous Labour Government, building materials increased by 5 percent per year. Since we have been the Government, building materials have increased by half that rate. That is what counts.

Phil Twyford : Your policy was a failure.

Hon Dr NICK SMITH : The member says that the policy is not working. Actually, we are building a faster rate of house build—double since I became Minister—and a faster rate that has been going for more than 10 years.

Electricity—Solar Energy

8. GARETH HUGHES (Green) to the Minister of Energy and Resources : Does he agree with the Treasury that solar electricity generation is one of the opportunities with the “most potential” to “reduce our carbon dioxide emissions in the medium-to-long-term”; if so, does he think the current rules are working to give Kiwis going solar a fair go?

Hon SIMON BRIDGES (Minister of Energy and Resources): Yes, I generally agree with Treasury’s full statement that technological advances in electric vehicles, biofuels and fuel switching, and renewable energy—e.g., solar—offer the most potential. I also, in answer to the second part of the question, think the rules are fair. That is why solar photovoltaic rates have skyrocketed since I have been Minister.

Gareth Hughes : So why does a country of only 4 million people have 29 different regional rules, forms, fees, and resource consent processes for someone to just put up a solar panel on their roof?

Hon SIMON BRIDGES : I would have to check those facts. I think, actually, what we have got is an incredibly successful electricity market, with an Electricity Authority and a piece of legislation that are very simple. I appreciate the member wants to wreck with that, but I do not accept that is a good thing to do.

Gareth Hughes : Why is it the case that a household that wants to go solar in Auckland likely faces no charges whatsoever to connect to the grid, while only an hour and a half’s drive down the road to Cambridge it can face $850 to do exactly the same thing?

Hon SIMON BRIDGES : I find that hard to believe. In fact, as I say, it is a very competitive market. In relation to solar, for example, what we know is that there is a range of retailers offering quite a number of buy-back schemes in relation to excess generation. Actually, a number of them are above the wholesale price, and in one case in Auckland it is over double. So I think it is a very competitive market delivering what is required, and, as I say, solar is going up exponentially.

Gareth Hughes : For a Minister who was just recently claiming credit for solar growth in New Zealand and cannot seem to answer particularly many questions, can he answer the question: does the country need a standard, nationwide framework for solar connections to simplify the process and to cut the red tape; and will the Minister respond to my invitation to sit down and talk about the “Fair Go for Solar Bill”?

Mr SPEAKER : Either of those two supplementary questions, the Hon Simon Bridges.

Hon SIMON BRIDGES : I am stung by that personal attack, but can I say that we have an excellent system for solar. That is why people are voting with their wallets and investing much more in it. That is why, actually, quite a number of companies are offering buy-back schemes above the wholesale price. I think it is an excellent system that we should not meddle with.

Child Poverty—Measurement

9. JACINDA ARDERN (Labour) to the Minister for Social Development : If reducing child poverty is a priority for her Government, why has the number of children living in poverty, based on the Household Incomes in New Zealandreport, increased from 260,000 in 2013, to 305,000 in 2014?

Mr SPEAKER : Again, as I call the Minister, I have been advised that this answer will be longer than normal.

Hon ANNE TOLLEY (Minister for Social Development): The member is misrepresenting the Household Incomes in New Zealand report, which uses multiple measures of poverty and hardship. I refer the member to page 131 on the household incomes report, which states that making the sort of claim that the member has just made in her question is not correct and “is misleadingly matter-of-fact.” and “breaches the reports’ multi-level approach to monitoring.” For the benefit of the member, the household incomes report shows that the median household income increased significantly last year, while the earnings of those on the lowest incomes have remained stable. That has increased the number of children living in households with incomes of less than 60 percent of the median income after housing costs despite their incomes remaining the same. Using that member’s logic of relying on a single measure, we would have reduced child poverty if the median income had fallen. This is obviously nonsensical and shows the importance of using a number of measures to assess long-term trends in poverty and hardship.

Jacinda Ardern : Is child poverty too high in New Zealand?

Hon ANNE TOLLEY : As I have just outlined in my answer to the primary question, it is very difficult to use one measure to determine poverty and hardship. However, this Government is determined to address the most severe hardship for our children, which is why in Budget 2015 we increased the benefit rate by $25 a week for the first time in 43 years, and we increased Working for Families for those low-income working families. Again, huge measures have been put in place to address the hardship that the lowest-income families in New Zealand have.

Jacinda Ardern : I raise a point of order, Mr Speaker. I deliberately asked a very short question: is child poverty too high in New Zealand? That was off the back of the Minister’s first answer, which I listened to. I asked for her determination. She did not give me an answer to that question.

Mr SPEAKER : Order! In fact, three of her colleagues interjected through the answer “Answer it—yes or no.” I refer the member to Speaker’s ruling 187/4, which states that you cannot demand a yes or no answer, no matter how clear the question is. [Interruption] Order! I am still ruling. On this occasion the best way forward, I suggest, is that I will give an additional supplementary question to the member Jacinda Ardern.

Jacinda Ardern : Is child poverty too high in New Zealand?

Hon ANNE TOLLEY : I am unable to answer that question. As the household incomes report points out, there is no way on one measure to actually answer that question. I refer the member to the annex to section H, which brings together all the measures relating to low-income and material hardship findings for children, which draws on both the incomes report and the companion report that goes with it. That is what we should be using to determine severe hardship and hardship in New Zealand families.

Jacinda Ardern : If child poverty is a priority, will she use Social Justice Week to set targets to reduce it like the UK has done; if not, why not?

Hon ANNE TOLLEY : As I said again in a previous answer, this Government is determined to address severe hardship for New Zealand families. That is why in Budget 2015 we brought in a package worth $790 million addressed to those families receiving the very lowest incomes. That is about actions that we take, not having special weeks to recognise it.

Jacinda Ardern : I raise a point of order, Mr Speaker. I asked the Minister specifically about whether or not she would set targets. I still did not feel like that question was addressed.

Mr SPEAKER : No. The member also referred to whether child poverty is a priority for the Government, and, without a doubt in my mind, the question was addressed on this occasion.

Jacinda Ardern : Why has the Minister set targets to reduce child abuse but will not set targets to reduce child poverty?

Grant Robertson : What a good question.

Hon ANNE TOLLEY : Well, it is an excellent question, actually. And the answer to the member is that it is very easy to measure the number of assaults on children. That is a very easy thing to measure. However, as the report points out—and, again, I direct the member’s attention to the annex to section H in the report that she is quoting from in the primary question, which brings together a range of measures that is needed to give a true picture of what is happening in those low-income New Zealand families.

Jacinda Ardern : Which elements of Labour’s child poverty bill, which sets five targets for reducing child poverty across five measures, does she disagree with; if she cannot name them, will she support the bill?

Mr SPEAKER : Either of those two supplementary questions.

Hon ANNE TOLLEY : I do not have the bill in front of me.

Avocado Industry—Reports

10. TODD MULLER (National—Bay of Plenty) to the Minister for Primary Industries : What recent reports has he received on growth in the avocado industry?

Hon NATHAN GUY (Minister for Primary Industries): Recent reports show that the avocado industry has experienced record volumes, with 7.9 million trays produced this year. This is up from 4.9 million trays in the previous year. I am sure that New Zealand’s growth will be a topic of conversation at the World Avocado Congress in Peru this week. Also, 90,000 new Kiwi households are now purchasing avocados and record volumes are being exported to priority Asian markets. Average orchard gate returns for growers are now almost $25,000 per hectare, up from $20,700 last year.

Todd Muller : How is the Government supporting this growth in the avocado industry?

Hon NATHAN GUY : That is a very good question. The Government has partnered with the avocado industry in the 5-year, $8.5 million Avocados Go Global Primary Growth Partnership programme. This will transform our avocado industry into a globally competitive, high-value, sustainable export industry, alongside a growing domestic market. The programme will help support the industry to triple productivity to 12 tonnes per hectare and quadruple industry returns from $70 million to $280 million by 2023. Also, the Korean free-trade agreement is hugely positive for the avocado industry.

Pest Control—1080 Use

11. RICHARD PROSSER (NZ First) to the Minister of Conservation : Does she have confidence in all aspects of her department’s use of compound 1080 poison?

Hon MAGGIE BARRY (Minister of Conservation): Yes, I do because 1080 remains the most effective method of controlling predator numbers in difficult hill country, and I strongly support its continued use in conservation efforts. The success of the Battle for our Birds shows how important 1080 really is in protecting our native creatures.

Richard Prosser : If she is satisfied that the department did the right thing with its unusual step of not closing tracks or restricting public access to the Coromandel Forest Park during last Sunday’s 1080 poison drop because it “did not see the bait as a safety risk”, why is she satisfied?

Hon MAGGIE BARRY : There was no need to close the tracks, because there was sufficient warning given to everybody who would be likely to be in that area that there were poison drops. The notification process has been exhaustive—490 landowners have been informed, 53 schools, 12 concessionaries, 12 permitted fur trappers, and three apiarists were consulted by phone 48 hours prior to the drop. And just in case anybody missed that, there were 180 signs of this size all around the main entrance points that were taken along the roads in Coromandel.

Richard Prosser : Is she satisfied that the department met all conditions of resource consent No. 122295, and that the manufacturer’s guidelines on the use of 1080, which, according to Animal Control Products is a deadly poison and ecotoxic, were followed?


Richard Prosser : How does she reconcile that answer with the fact that the bait-processing area was within 100 metres of a perennial waterway, that bait was dropped into a registered drinking-water supply, and that the park was not closed?

Hon MAGGIE BARRY : The park did not need to be closed, and that was in the view of the medical officer who deemed that public safety was not at risk. Ultimately, the resource consents are decided through the councils and the public health safety issues are decided by the medical officers of health. They were both satisfied with the arrangements.

Richard Prosser : Is she satisfied with the fact that members of the public, including three busloads of young Limited Service Volunteers who entered the area at the time, were not informed about the drop and thus denied the choice as to whether they were exposed to deadly poison being dropped on them from the air?

Hon MAGGIE BARRY : I draw the member’s attention to the answer I gave earlier and the signage that was present. If you say that nobody read the 180 signs in the areas around that area—they could easily have seen that, so they needed to have looked at the signs. There were also notices in the newspaper, as well as all of the affected individuals whom I listed earlier being told. In addition to that, there are very strict controls around 80 metre buffer zones as to where these drops can be taken. They were dropped in the appropriate quantities of around 2 kilograms per hectare and the conditions were met. There have been no complaints from members of the public, either to the regional council or to the health authorities.

Tertiary Education Organisations—Minister’s Statements

12. Hon DAVID CUNLIFFE (Labour—New Lynn) to the Minister for Tertiary Education, Skills and Employment : Does he stand by all his statements to the House last week in respect of tertiary education organisations?

Hon STEVEN JOYCE (Minister for Tertiary Education, Skills and Employment): Yes.

Hon David Cunliffe : Does he stand by his statement regarding funding requirements on tertiary organisations that oversight agencies are “entitled to expect that the governors and operators meet those requirements and make representations to the Tertiary Education Commission that are correct.”?

Hon STEVEN JOYCE : Yes, I do.

Hon David Cunliffe : Is he aware that a sitting National MP was a member of that board and oversaw this systemic rorting; if so, has he asked Barbara Kuriger MP why rorting at Taratahi Agricultural Training Centre went on for so long under her watch and what she did about it?

Mr SPEAKER : The Hon Steven Joyce—either of those two supplementary questions.

Hon STEVEN JOYCE : I think the member is being deliberately nasty, and—

Mr SPEAKER : Order! Just answer the question.

Hon STEVEN JOYCE : In relation to Taratahi, there are some issues, as the member knows. I would point out that there is an investigation, from the Tertiary Education Commission and from other agencies. I think we should let those other agencies complete their investigations.

Hon David Cunliffe : I raise a point of order, Mr Speaker. Respectfully, I do not believe that the Minister has addressed the specific question—

Mr SPEAKER : Order! The question was quite long. There were two parts to the question—was he aware that this particular National member was on the board, and the second part was whether he had spoken to her—

Hon David Cunliffe : Had he asked her, yes, and—

Mr SPEAKER : The Hon Steven Joyce, if he could address either of those two supplementary questions.


Hon David Cunliffe : Why was no action taken by the Tai Poutini Polytechnic council in relation to a Protected Disclosures Act investigation, requested by a quality assurance manager in 2013 because of a “failure to maintain an auditable standard of enrolment and credit, and because of health and safety concerns.”?

Hon STEVEN JOYCE : If the member would like to provide the information that he claims to be the case, then I would be more than happy to have a look at it for him. I have looked at the information that he has provided through the media last week in relation to some suggested matters with Tai Poutini Polytechnic and so far have not been able to discern anything that has not already been previously addressed. But, if he has an issue he would like to raise, I am more than happy for him to supply that information and I will address it.

Hon David Cunliffe : I seek leave to table a document showing that allegations of systemic rorting were raised with the Tai Poutini Polytechnic council on 20 December 2013—it being a letter from a then quality assurance manager, dated 20 December 2013, to a then council member.

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

Hon David Cunliffe : I seek leave to table a letter to myself from that quality assurance manager—[Interruption]

Mr SPEAKER : Order! This is a point of order.

Hon David Cunliffe : —and I refer to the fact that the letter is not publicly available—and it asks why the Tertiary Education Commission would investigate and say that the figures for the courses were accurate when evidence—

Mr SPEAKER : Order! The letter has now been described. It does not need to be further described. Leave is sought to table that particular letter to the honourable member. Is there any objection? There is objection.

Hon David Cunliffe : I raise a point of order, Mr Speaker. Just to clarify that, was there objection—

Mr SPEAKER : Order! I ruled that there was objection. I heard objection.

Hon David Cunliffe : How can the public have confidence in the National Government’s oversight of tertiary institutions when more examples of tertiary rorting are coming to light every week and now a member of its own caucus is implicated in this scandal?

Mr SPEAKER : Order! The last part of the question is out of order. I will allow the very first part; the last part is completely out of order.

Hon STEVEN JOYCE : “Detective Sherlock” over there has so far released some information into the public domain—

Chris Hipkins : I raise a point of order, Mr Speaker. [Interruption]

Mr SPEAKER : Order! A point of order has been called.

Chris Hipkins : You have been much more rigid in your application of the Standing Orders and Speakers’ rulings this week, and one of the most basic Standing Orders is that members have to be referred to by their appropriate names or titles.

Mr SPEAKER : I actually did not hear the interjection. I do acknowledge that if there was an interjection, I did not hear it. If the Minister would start his answer again—he was simply asked how New Zealanders could have confidence in tertiary education. [Interruption] No, I do not need any assistance from the member. The member has asked the question, and it has not yet been answered.

Hon STEVEN JOYCE : The member raised some information in the public domain in the last few days, all of which have been raised previously with the Tertiary Education Commission and the New Zealand Qualifications Authority, and thoroughly investigated at the time. From what I can see, the member has got completely the wrong end of the stick, but if he has new information, I repeat my invitation to him. Rather than grandstanding about it, I am happy to read it and see whether it needs acting on.


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