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Questions and Answers - Feb 16

Questions to Ministers

Budget 2016—Job Creation and Wages

1. Dr JIAN YANG (National) to the Minister of Finance: How will Budget 2016 support further growth in jobs and wages, while maintaining the Government’s fiscal management?

Hon BILL ENGLISH (Minister of Finance): The Budget will be on 26 May. It will continue the Government’s record of fiscal discipline, which focuses on getting better results from spending and managing long-term spending pressures. As a result of that, so far, expenditure has fallen from 34 percent of GDP in 2011, where it peaked, to 30 percent in 2015. We are committed to achieving debt of around 20 percent of GDP by 2020. As we said in the Budget Policy Statement, with the Budget now broadly in balance, the Government will not distinguish between forecasts of small negative balances and small positive balances.

David Seymour: What is the fastest growing item of expenditure over the next 5 years according to the Budget Policy Statement?

Hon BILL ENGLISH: That is likely to be national superannuation, which is rising at around $700 million to $800 million per year. Alongside that, the Government only spends about another billion dollars per year on everything else.

Dr Jian Yang: What recent steps has the Government taken to support growth, delivering more jobs and higher wages for New Zealand households?

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Hon BILL ENGLISH: The most recent and one of the largest steps the Government has taken is to sign the Trans-Pacific Partnership agreement (TPP agreement). This gives equal and fair access for New Zealand exporters to 800 million customers in 11 countries that account for 36 percent of the global economy, including the world’s biggest economy, the United States. It also means that other countries are bound under that agreement by rules that help protect access of New Zealand exporters to overseas markets. So the TPP agreement is important to jobs and incomes in New Zealand; the alternative of not participating would certainly be bad for New Zealand households.

Dr Jian Yang: What is the outlook for economic growth over the next 4 years, and how will this growth deliver more jobs for New Zealand households and families?

Hon BILL ENGLISH: After a relatively soft first half of 2015, recent data suggest the New Zealand economy picked up somewhat in the second half of last year, and the outlook is for continuing, moderate growth. The most recent forecasts expect GDP to grow around 2.7 percent per year each year through to 2020, and what this means in terms of jobs and incomes is that there will be a further 173,000 additional jobs, on top of the 175,000 jobs added in the last 3 years.

Dr Jian Yang: What are some risks to the economic outlook?

Hon BILL ENGLISH: It is fair to say that 2016 has started with, certainly, a perception of greater risk in the global economy. Factors making up that would be weak commodity prices, and slower growth in China, driven by lower investment, even though the consumption aspect of China’s economy is growing pretty strongly. There is uncertainty around the impact of US interest rates and there appears to be some growing risks around European banks. We will continue to focus on New Zealand’s resilience to any of these changes.

Grant Robertson: Is ASB chief economist Nick Tuffley correct when he says: “On a per-capita basis, there has essentially been no growth over the past year.”?

Hon BILL ENGLISH: In fact, he may not be correct. It depends how you measure growth over the last year. It is not surprising that in a growing economy where more and more people are turning up to enjoy the benefits of one of the faster-growing developed economies, that we may get periods where per capita growth is a bit slower, but overall Treasury analysis shows per capita growth has averaged about 1.2 percent per year, if you exclude the Canterbury earthquake.

Rt Hon John Key: What is New Zealand’s unemployment rate, and has he seen any predictions of the unemployment rate going to 7 percent?

Hon BILL ENGLISH: The most recent unemployment number was, I think, 5.3 percent, somewhat below the Labour Party finance spokesman’s forecast, which as usual was based on his wishful thinking that everything will go bad suddenly. He forecast 7 percent.

Grant Robertson: Has the Minister of Finance seen the forecast from Treasury of unemployment being 6.5 percent in 2016 and possibly reaching 7 percent in 2017?

Hon BILL ENGLISH: You have always got to be a bit careful with quarter-to-quarter numbers. It turns out Treasury was wrong, but it is pretty hard to be wronger than the Opposition finance spokesman.

Economic Outlook —Reports

2. JAMES SHAW (Co-Leader—Green) to the Minister of Finance: Has he read recent economic reports from ASB and Westpac and is he planning on doing anything differently as a result?

Hon BILL ENGLISH (Minister of Finance): Yes, and no. Both of the reports make reasonably balanced comments about the economy, although I disagree with some of the negativity in the ASB report.

James Shaw: And in light of his response to Mr Robertson’s question previously, does he agree with ASB’s chief economist, Nick Tuffley, who says that population increases account for much of New Zealand’s economic growth at present? And why, after 7 years of his economic leadership, does New Zealand still lack a strong, diversified export economy?

Hon BILL ENGLISH: In answer to the member’s question, the issue is what the point of the analysis is. A year or two ago, the Opposition parties were saying there is no growth without the dairy industry, then it was saying there is no growth without the Canterbury rebuild, and now it is saying there is no growth without population growth. Well, if you take out all of the things that are growing, you end up with no growth.

James Shaw: In light of that answer, how can he say that the New Zealand economy is strong and it has a diversified export economy when the recent downturn in one sector alone has left a $17 billion hole in the economy?

Hon BILL ENGLISH: It must be a diversified economy if we can have a pretty sharp slump in dairy prices and still have 2 percent growth, a 60,000 net migration inflow, a flourishing tourism sector, and big growth in employment such that the unemployment number has dropped to under 5.5 percent. That tells you we do have a diversified economy that is not totally dependent on dairy prices.

James Shaw: So then does he agree with Westpac economists Dominic Stephens, Anne Boniface, and David Morgan, who recently found that his Government’s exclusion of agriculture from the emissions trading scheme “skews the way resources are allocated in the economy and puts farmers at risk by avoiding the difficult choices that they are going to have to make at some point in the future.”?

Hon BILL ENGLISH: No. I agree with the Government’s approach, which is a pretty practical one, which is that there is not much point in taxing one of our most globally competitive industries when, at the moment at least, there is not the technology available to enable them to reduce emissions. But the Government is investing millions, along with 30 or so other countries, in finding solutions for agricultural emissions.

James Shaw: So then does he also disagree with Westpac, which found that the lack of a proper price on carbon also skews investment even within the agricultural sector, resulting in long-term land use decisions favouring dairying over cleaner alternatives like forestry and sheep farming.

Hon BILL ENGLISH: If you are following through the theory of putting a price on them, that may be the case. But we have decided not to tax them when they cannot take measures to reduce their carbon emissions. What I would say, though, on the agricultural sector is that constraints such as nitrate loadings are starting to have a considerable impact on land-use decisions in agriculture, to the benefit of the quality of our fresh water. I think we should take the opportunity to congratulate the farming sector on the gritty way it is coming to grips with those pretty challenging issues.

James Shaw: Let me be clear: is he disagreeing with the Westpac report on the nature of emissions trading schemes and the exclusion of agriculture?

Hon BILL ENGLISH: No, what I said was if you were putting a price on agricultural emissions, then the lack of the price follows the logic of that criticism. The Government, however, has decided not to do it for the reason that I said, which is that while there is no technology available to the farming community to change its emissions profile, the Government has decided not to pointlessly tax a globally competitive industry.

James Shaw: Let me just repeat the last question—

Mr SPEAKER: Order! We do not need the lead in—[Interruption] Order! It is perfectly OK to repeat the last question, if the member wants to use another supplementary question that way, but we do not need the lead in to the supplementary question.

James Shaw: How can he justify excluding considering agriculture from the current emissions trading system review when it so clearly creates big imbalances in the New Zealand economy?

Hon BILL ENGLISH: We do not believe that it creates large imbalances in the New Zealand economy. The Greens have just got to listen to themselves. They have been complaining that the carbon price is too low—far too low. So even if we had decided to impose carbon pricing on agriculture, it would have had the effect their spokesman pointed out in the select committee this morning—that the price is too low to make much difference. So even if we had followed Green policy, it would not have had an impact.

Rt Hon John Key: Has the Minister of Finance seen any reports on the logic of someone who would argue that they are worried about the economy but want to put a big fat tax on export-orientated parts of the economy but do not want to support the single thing that would make the economy go faster, and that is the Trans-Pacific Partnership and exposure—

Mr SPEAKER: Order! There is no need to answer that. That question was designed—[Interruption] Order!

Rt Hon John Key: It was such a good question.

Mr SPEAKER: Well, it was not such a good question. For a start it was too long.

Prime Minister—Tertiary Education Fees

3. ANDREW LITTLE (Leader of the Opposition) to the Prime Minister: Does he stand by his statement regarding Labour’s fees-free post-school study policy that “the question will simply be that if it is completely free, will there be any control on the quality”?

Rt Hon JOHN KEY (Prime Minister): Yes.

Andrew Little: Given that answer, is he saying that when he went to university for free there was no quality control?

Rt Hon JOHN KEY: There may well have been better control back then, but I tell you what, when Labour got into office and had the sorts of policies it is advocating now, there was an explosion in low-quality, part-time courses with very poor completion rates, and the member knows that is the case.

Andrew Little: Putting aside courses on homeopathy for pets and iridology, which appeared under his Government, is he saying that it is a good thing that some people cannot afford a qualification even though that gives them a chance for the Kiwi Dream?

Rt Hon JOHN KEY: Far from that, what the Government is saying is that if one looks at the current situation with tertiary education, on balance about 70 percent or maybe as high as 80 percent of the costs are actually met by the taxpayers other than the individual. Yet we know that the person, when they go to university and complete their tertiary qualification, actually earns a lot more money. On balance, I do not think it is unreasonable for someone who is going to earn about 46 percent more than the median wage after 5 years should actually pay that 20 or 30 percent. I think that balance is about right.

Andrew Little: Does he not accept that it is just a little bit hypocritical for him, with his free education and no student debt, to claim that people who do not pay fees will not study hard?

Rt Hon JOHN KEY: No.

Tim Macindoe: In light of the primary question, does the Prime Minister stand by his statement regarding Labour’s policy that “Under Andrew Little Labour has become the TPP—the ‘Two Position Party’.”?

Chris Hipkins: I raise a point of order, Mr Speaker. Although the question does in fact open up questions on Labour’s education policy, it certainly does not open up questions on other aspects of the Labour Party policy, which that supplementary question was getting to.

Mr SPEAKER: I need no further assistance. On this particular occasion I agree with the point raised by Chris Hipkins. That question is designed to do nothing else but to attack the Labour Party. I do acknowledge that the original question did mention the policy in the first place.

David Seymour: How much more rapidly has the median New Zealand house price risen than the average student loan over the past 3 years?

Rt Hon JOHN KEY: I do not know, but I suspect it is a terrible amount.

David Seymour: I seek leave to table a back-of-envelope calculation—

Mr SPEAKER: Order! [Interruption] Order! The member will resume his seat. Raising points of order like that leads to more disorder, and I would hate at this early stage of this parliamentary year to be asking the member to leave the Chamber for that reason.

Andrew Little: In light of the analysis out today from Universities New Zealand that when a person goes into a job like IT, engineering, marketing, or science they are going to pay more than 10 times the fees they paid for their education, is it not better to be investing more in people to get qualifications?

Rt Hon JOHN KEY: The member is in serious risk of blowing both of his feet off. That is exactly the point: at the moment, people do go to university, they are not stopped, they get a free student loan—

Hon Members: A free student loan!

Rt Hon JOHN KEY: —they do go out and pay more taxes, and—a zero percent student loan—why the hell should they get somebody on low income’s cross-subsidising? [Interruption] That is exactly the point. The system is working.

Tim Macindoe: In light of the primary question, does the Prime Minister stand by his recent statements about all of Labour’s recent announcements?

Chris Hipkins: I raise a point of order, Mr Speaker. If the supplementary question was specific to the primary question, in relation to the quote that Andrew Little used in his primary question, that question may have been in order. But the Prime Minister has no responsibility for all of the policy announcements that the Labour Party has made.

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

Hon Gerry Brownlee: The primary question asks whether the Prime Minister stands by his statement regarding Labour policies.

Chris Hipkins: No, a specific Labour policy.

Hon Gerry Brownlee: Well, all right, a specific—

Mr SPEAKER: Order! This is a point of order—[Interruption] Order! Can we just be clear. This is a point of order being raised by Gerry Brownlee, and it will be heard in silence.

Hon Gerry Brownlee: Mr Speaker, to be clear, I am speaking to the point of order raised by Chris Hipkins, which was the result of his shooting himself in the foot by lodging the question in the first place. The question says: “Does he stand by his statements regarding Labour’s free post-school study policy”. If the ruling would be that you cannot ask for a general question based off that about Labour policy, then it would assume that we can ask specific questions about specific Labour policy positions. [Interruption]

Mr SPEAKER: Order! [Interruption] Order! If the Minister is keen to stay for the balance of question time, I suggest he also does not interrupt. I am going to allow this question. It was a very general question about the Prime Minister standing by his statements, as I heard it, but if in the answer I detect that it is being used simply as a means of attacking the Opposition, I will then be inclined to close the answer down very quickly.

Chris Hipkins: I raise a point of order, Mr Speaker. Part-way through the Leader of the House’s point of order, I expected you to either interrupt him or ask him to actually come to the point of order. If it is now legitimate for us to insult other members during points of order, we are happy to participate in that process—

Mr SPEAKER: Order! [Interruption] I do not need any assistance from either member. The member might have noticed that I did interrupt the Minister through his point of order, only because I was dealing with a number of interjections from this side. The point of order has been heard; my ruling has been given. I will not ask for the question to be repeated, but I will be listening very carefully to the Prime Minister’s answer. If I see it leading down a path where it is simply attacking the Opposition, I will then deal with it.

Rt Hon JOHN KEY: Yes, I do stand by all my statements, and I think it is worth recapping those. At the moment the taxpayer pays about 70 to 80 percent of the tertiary education of someone who goes on to earn, on average, a lot more in New Zealand. To me, that balance seems about right. Having no controls on the sorts of courses that would be promoted under the sorts of policies we have seen announced in recent times would actually lead to low-quality courses that would largely be part-time, for which the completion rates would be very low. The reality is that it is a dog of a policy.

David Seymour: Can the Prime Minister confirm that the correct answer to my earlier question was a ratio of 2.8, and does he believe that young people should be far more worried about rises in median house prices than rises in student loans?

Mr SPEAKER: Either of those two supplementary questions, the right honourable Prime Minister.

Rt Hon JOHN KEY: On the basis that the member is a very gifted member, whom I offered a warrant—and he turned it down—and it would therefore have only been offered if he had true ability, I will accept him at his word that it is 2.8 percent.

Andrew Little: Is the Prime Minister so out of touch with the real world that he cannot see that student debt is a barrier to people getting post-school qualifications; why would he not want to do something about that?

Rt Hon JOHN KEY: It is an interesting thought to say that student loans are a barrier to people going to university, because thousands and thousands, tens of thousands, of people are. We have seen a lot more people completing high-quality and tertiary qualifications under this Government; the bulk of people who go actually earn more over time; people actually do complete degrees that are worth it; and if the member is saying those things are not true, he is philosophically saying that a policy that was supported for 9 years through a Labour Government was totally and utterly wrong. All he is doing here is trying to change the line between the taxpayer paying 70 or 80 percent, to higher—and, actually, that will be paid for by lower-income New Zealanders, the logic of which defies me.

Mr SPEAKER: Order! The answer is quite long enough.

Andrew Little: Is this not the truth, that he has been penny-pinching, rather than investing in New Zealanders’ future; he is locking New Zealanders out of the Kiwi Dream; and only the Labour Party has the courage and the ideas to fix the problem?

Rt Hon JOHN KEY: The truth of it is that this is a policy that was announced on the Sunday and sank faster than the Titanic. This is the party that told us that all it cares about is the Trans-Pacific Partnership, but it knows it is getting ripped apart on it and does not like it. It has been a horrible start to the year for the Labour Party, it really has. [Interruption]

Mr SPEAKER: Order! That is enough now.

Corrections System—Middlemore Hospital

4. MAHESH BINDRA (NZ First) to the Minister of Corrections: Is she aware that a prisoner escaped from Middlemore Hospital in December 2015; if so, when was she made aware of the incident?

Hon JUDITH COLLINS (Minister of Corrections): I was not the Minister of Corrections at the time of this escape and therefore was not aware then, but I have been made aware of it as of today because I am now the Minister.

Mahesh Bindra: What action was taken to ensure that corrections staff do not fall asleep as a result of fatigue while on duty?

Hon JUDITH COLLINS: The matter is now an employment matter, and I would have to say that that is the correct response. It is an employment matter and corrections is dealing with it.

Mahesh Bindra: How does that action ensure that corrections staff do not fall sleep as a result of fatigue while on duty?

Hon JUDITH COLLINS: I think I have answered that. It is an employment matter. Corrections take it very seriously. I think the threat of losing one’s job would sort of work it out, really.

Mahesh Bindra: Does she still have confidence in the management of Auckland Region Women’s Corrections Facility, or is she planning to hand over management to Serco?

Hon JUDITH COLLINS: I have full confidence in corrections and, in particular, in the management of the women’s prison at Wiri. I am not planning to do anything with it other than to go and visit it again and look at the fabulous Mother and Baby Prison Unit that I set up and the drug units and all those sorts of things that I was privileged enough to be able to be Minister for. Thank you.

Mahesh Bindra: I seek leave to table the Department of Corrections’ incident information report created on 5 December, showing the reasons—

Mr SPEAKER: Order! We do not need a further description of it. I will put the leave. This is a corrections incident report. Leave is sought to table it. Is there any objection? There is none. It can be tabled. Document, by leave, laid on the Table of the House.

Broadband, Ultra-Fast and Rural—Progress

5. JONATHAN YOUNG (National—New Plymouth) to the Minister for Communications: What recent announcements has she made on the progress of Ultra-Fast Broadband and Rural Broadband Initiatives?

Hon AMY ADAMS (Minister for Communications): Yesterday I released the latest quarterly report to December 2015. Halfway through the build period the Ultra-fast Broadband Initiative project is now 60 percent complete and ahead of schedule. Connections have grown by 135 percent over the last year to more than 162,000, meaning uptake has increased from one in nine to almost one in five. Fibre coverage has increased by 54 percent in the last year, with more than 875,000 households and businesses now able to connect. This project is an excellent example of how this Government is delivering greater connectivity for New Zealanders.

Jonathan Young: How is the Government delivering improved connectivity for rural New Zealand?

Hon AMY ADAMS: The Rural Broadband Initiative programme is delivering significant benefits for our rural communities. Over the last year there has been a 32 percent increase in rural New Zealand households and businesses able to connect faster, more reliable broadband, which now reaches around 500,000 New Zealanders. The Rural Broadband Initiative is also extending mobile coverage to rural areas across New Zealand. In the last quarter alone almost 1.8 million devices accessed services on just one network. In addition, more than 200 of the Rural Broadband Initiative towers have now been built or upgraded to 4G services, meaning rural families and businesses now have access to fibre-like speeds, with many experiencing download speeds of 100 megabits a second.

Jonathan Young: How are the Ultra-Fast Broadband Initiative and Rural Broadband Initiative programmes delivering for priority users?

Hon AMY ADAMS: As at 31 December last year, around 96 percent of businesses within the ultra-fast broadband coverage areas can now connect to world-leading fibre broadband—that is, over 200,000 individual firms, stores, and traders who can now compete on the world stage. I have also recently announced that every hospital, every designated family health centre, and every school are now able to access high-speed broadband connectivity under our programmes.

Mental Health Services—Funding

6. Hon ANNETTE KING (Deputy Leader—Labour) to the Minister of Health: Does he stand by his statement last week on Canterbury District Health Board that “I was down there in November announcing the extra $13 million, and that is more than ample to cover the $4 million that Canterbury said was necessary to cover mental health demands”?

Hon Dr JONATHAN COLEMAN (Minister of Health): Yes, and I quote the Canterbury District Health Board chief executive officer. He said in his written update to staff yesterday: “You may recall we received additional funding late last year. This has enabled the DHB to sustain its level of investment in mental health services while at the same time delivering on a financial break-even position.”

Hon Annette King: Was the chairman of the Canterbury District Health Board incorrect when he said at the select committee last week that Canterbury District Health Board had “a deficit in our budget of $17 million and the Government gave us another $16 million to balance our books so actually it was already spoken for; it was actually so we would come in with a zero budget rather than a deficit budget.”?

Hon Dr JONATHAN COLEMAN: Well, you know, I cannot really see what the member’s point is, quite frankly. Canterbury District Health Board said to us it had a $16 million deficit. We said yes, we will fund that upfront, and then it will be able to use that money at its discretion to fund whatever services the chief executive officer thinks is appropriate. He said that some of that money should be used for mental health services and that is what he is using it for.

Hon Annette King: Did Canterbury District Health Board receive $222 per head of population for mental health funding for 2015-16 while the national average was $243; if so, why did he say in Parliament last week that he absolutely disputed the district health board’s claim?

Hon Dr JONATHAN COLEMAN: No, what it received was $147 million of ring-fenced funding—that is a $23 million increase on 7 years ago—and it will receive more in this Budget because the Canterbury District Health Board budget has gone up by $254 million over the last 7 years and it is now at $1.36 billion. That is a huge budget and the chief executive officer gets to decide how he spends it.

Hon Annette King: I would like to table the Canterbury District Health Board chief executive officer’s update newsletter quoted by the Minister. It is dated 15 February, in which they say—


Hon Annette King: —they got $222 per head—

Mr SPEAKER: Order! The member will resume her seat. I will put the leave; there is no need to further describe it. Leave is sought to table that particular newsletter. Is there any objection? There is none. It can be tabled. Document, by leave, laid on the Table of the House.

Hon Annette King: Has the Canterbury District Health Board been told that for the 2016-17 financial year it can expect another decrease of $10 per head for mental health, even less than the 2015-16 funding; and is he still insisting it can live within its budget?

Hon Dr JONATHAN COLEMAN: No, they have not been told that—the member is making it up. Basically, they are getting $147 million this year in terms of mental health. It will go up next year.

Hon Annette King: I raise a point of order, Mr Speaker. I take exception to the Minister saying I am making it up. I have offered to table the information that he quoted, where it says they get $10 less—

Mr SPEAKER: Order! Order! No, order! We are now—order! The member’s answer was not helpful, but it is hardly disorderly to stand up and say that he disagrees with the figures and the member is making them up.

Hon Annette King: What will it take for him to listen to the pleas from staff and the people of Canterbury to take their mental health issues seriously, particularly in light of the latest earthquake and the challenges that they face, like the 20-week wait list for child and family mental health services and a 55 percent increase in suicide-related callouts since 2011?

Hon Dr JONATHAN COLEMAN: Look, I am in touch with the District Health Board all the time. I have been in touch with the chair today. The fact is that we have put in an extra $86 million above the population-based funding formula to support the Canterbury District Health Board through the earthquake period. We have put in a $950 million hospital rebuild programme, $13.5 million in Budget 2014 over 4 years for the psychosocial recovery plan—there is a lot going in there. I will be down there regularly; the Prime Minister is down there regularly. Canterbury is an absolute top health priority for this Government. Sorry, but it is true.

Canterbury, Recovery—Effect of 14 February Earthquake

7. NUK KORAKO (National) to the Minister for Building and Housing: What reports has he received on the issues of rock falls, liquefaction, and building performance arising from Sunday’s earthquake in Christchurch, and what implications do these have for the ongoing rebuild work for the city?

Hon Dr NICK SMITH (Minister for Building and Housing): I am advised that Sunday’s earthquake caused five major rockfalls totalling several thousand tonnes of rock. It was lucky, actually, that no one was seriously injured or killed. These were in areas that were red-zoned as vulnerable by the geotechnical assessments made by my ministry of both the Port Hills and Sumner areas. The areas of liquefaction were consistent with the ministry’s technical advice on the areas that were red-zoned. There has been significant innovation and foundation design on technical category 3 land, and we are using Sunday’s quake to review how these designs performed to ensure that we have got those design standards right. Preliminary assessments at six sites where liquefaction occurred show that these new foundation systems are working well. There were some previously damaged buildings that sustained greater damage as a result of Sunday’s quake, and one cordon has been extended. The processes for managing these have been updated and are much improved on 2010.

Nuk Korako: How has the Government translated into building safety the heightened risk in Christchurch of ongoing earthquakes from the original 2010 event, and is he satisfied that the building code adequately manages this risk?

Hon Dr NICK SMITH: There is a heightened risk of quakes following a major event like the 2010 quake, and that results in a higher probability of quakes for several decades. The Government responded to this in 2011 by increasing the seismic hazard risk factor in Christchurch by 36 percent, i.e., from 0.22 to 0.30. The practical effect of this change is that newly constructed buildings, since 2011, have had to be designed to cope with a significantly stronger earthquake. Initial assessments from the ministry are that new buildings performed well in Sunday’s quake, albeit that it was significantly smaller than the maximum that new buildings are designed for. Seismic events are unpredictable, but the Government is using the very best seismic and engineering advice to ensure the rebuild is as safe as is practically possible.

Nuk Korako: What reports has he received on rockfalls, including the Redcliffs School site, and what conclusions does he draw from these reports?

Hon Dr NICK SMITH: Redcliffs School is an area of near-identical geology and risk profile to those that experienced substantive rockfalls on Sunday. Site inspections yesterday by geotechnical engineers—[Interruption] I would have thought members opposite might be concerned about these safety issues. Site inspections yesterday by geotechnical engineers showed additional damage from Sunday’s quake on the Redcliffs site, with new cracks in the upper third of the rock face and a number of individual boulders dislodged from the face. This school site has previously had five substantive rockfalls from the size of 100 tonnes and one of nearly 50,000 tonnes. Sunday’s events reinforced the correctness of the Minister’s decision to follow professional geotechnical advice and to not reopen the school. I note Ruth Dyson and the Leader of the Opposition—

Mr SPEAKER: Order! [Interruption] Order! The question has been answered. There is no need for the last part of it.


8. RON MARK (Deputy Leader—NZ First) to the Minister of Police: Is she satisfied with Police numbers in New Zealand?

Hon JUDITH COLLINS (Minister of Police): Yes, and I am very proud that since 2009 this Government has boosted the annual police budget by $200 million to increase police numbers by 600, to a record 8,907 sworn officers.

Ron Mark: Does the Minister think that the 90,000 residents of Rodney should be satisfied with the current police numbers when the resolution rates for breaking and entering homes currently sits at 14 percent?

Hon JUDITH COLLINS: I have a tremendous amount of empathy for victims of burglaries, and under this Government burglaries have actually reduced from 60,000 in 2010, to 52,000 last year. The police are making resolutions of burglaries a priority and they want to ensure that they continue to reduce the number. I support them in that.

Ron Mark: With the help of the Ombudsman, could I seek leave to table the police’s Official Information Act reply we received, dated 15 December 2015, which details the number of police on duty over April 2015 in towns throughout New Zealand.

Mr SPEAKER: Can the member assure me that this is not publicly available?

Ron Mark: No, this is not publicly available—

Mr SPEAKER: 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.

Ron Mark: What contact has the Minister received from members of the Rodney Local Board about the activities of the Hell’s Angels in Kūmeu and Helensville, and does she believe the police have adequate numbers to deal with this situation?

Hon JUDITH COLLINS: I cannot recall actually having heard from the members of the Rodney Local Board in relation to that, but I can tell the member that this Government takes organised crime extremely seriously. The members of the Hell’s Angels and other ridiculous gangs are involved in very serious criminal activities and we have a plan to crack down on them.

Ron Mark: Would it concern the Minister to hear comments from a police officer saying that there are now over 70 high-ranking gang members who have taken up residence in Kūmeu and Helensville as a direct result of police under-resourcing, and that gangs are now looking at the spread of police officers and are moving into areas with low numbers?

Hon JUDITH COLLINS: Yes, that would concern me, and I would also, therefore, like to hear that that member would belatedly support the search and surveillance powers that this Government pushed through with the ACT Party for the New Zealand Police. Unfortunately, that member did not support them.

David Seymour: Is the Minister aware that members of New Zealand First objected to Parliament debating my three-strikes burglary bill just last week?

Mr SPEAKER: I will allow the question in so far as there is ministerial responsibility to be aware of that issue here in this Parliament.

Hon JUDITH COLLINS: Well, having been in Parliament on that day, yes, I am aware of that.

Mt Eden Corrections Facility—Prisoner Safety

9. KELVIN DAVIS (Labour—Te Tai Tokerau) to the Minister of Corrections: Why was the Law and Order Committee not told at the Corrections Estimates hearing last year about either the 2009 or 2014 investigations into organised prison violence at Mt Eden Corrections Facility?

Hon JUDITH COLLINS (Minister of Corrections): Putting aside the mistake in the member’s question—the Mt Eden Corrections Facility did not open until 2011—I can inform the member that the 2009 investigation at the old Mt Eden Prison found no evidence of organised violence, so was not escalated by officials to a ministerial level, and that the 2014 investigation was brought to the then Minister’s attention following the publication of video footage that occurred after the estimates hearing on 24 June 2015.

Kelvin Davis: Given her failure to disclose the 2009 investigation into organised violence at Mt Eden Prison, is this the only time she has misled the public about prison management on her watch?

Hon JUDITH COLLINS: I raise a point of order, Mr Speaker. That is an offensive question. That member knows full well that I had no knowledge of any 2009 violence. He needs to withdraw and apologise.

Mr SPEAKER: Order! I am going to allow the member to rephrase that question. If you think about the question, it is directly contrary to the information the Minister has just given in the answer to the primary question. I will give the opportunity—[Interruption] Order! I do not want to have to ask the member to leave, particularly with a question on the Order Paper. Would the member please rephrase his question.

Hon David Parker: I raise a point of order, Mr Speaker. A similar point of order was raised by Annette King in respect of the answer by Jonathan Coleman in respect of his suggestion that she was fabricating data that she had in a report before her. I would ask for consistency.

Mr SPEAKER: The difficulty with the question—it is not in my mind a similar situation at all. The question then referred to the opening of a facility in 2009. The Minister had already answered that that was not the case. She has taken exception to the primary question. I will give the member a chance to ask the question.

Kelvin Davis: Given that the Minister has said that there was a new prison opened, were the prisoners in the old prison also in the new prison?

Hon JUDITH COLLINS: The member might ask when in the last 5 years. The Mt Eden Corrections Facility now is primarily a remand prison. The average length of stay is 28 days. That member is talking about something that apparently occurred, or he thinks it occurred, now 7 years ago. They will not be the same prisoners, 28 days is the average stay, and there are 30,000 prisoner movements, as in, in and out of that prison, every single year.

Kelvin Davis: Can this Parliament expect more openness from her and her officials in the future about prison problems, such as at the annual review hearing for the Department of Corrections tomorrow?

Hon JUDITH COLLINS: Well, really, it is up to that member—for instance, in a select committee inquiry or hearing—to ask questions. Today I have seen a member who has not done his homework, who continues to state as questions things that are of dubious value, and in 2009—

Mr SPEAKER: Order! I have a point of order from Kelvin Davis.

Kelvin Davis: I raise a point of order, Mr Speaker. I asked whether this Parliament could expect more openness from the Minister.

Mr SPEAKER: And the Minister was addressing that question.

Kelvin Davis: Does she believe that Serco’s management of Mt Eden Corrections Facility has lived up to the “high standards of professionalism, safety, rehabilitation, and security expected by the Government” she placed on them in 2010?

Hon JUDITH COLLINS: As that member well knows, the relation of the report into Serco’s management is subject to a judicial review hearing, and it would not be appropriate, I think, for me to comment on a matter that is before the courts.

Kelvin Davis: I raise a point of order, Mr Speaker. I asked her whether she believes they have lived up to the expectations that she expected of them in 2010.

Mr SPEAKER: And the Minister in her answer in addressing that question said she did not want to go further with an answer because it was currently, as I understood it, under a judicial review. That is an answer a Minister can give. It might not satisfy the member, but it still addresses the question.

Kelvin Davis: How many more fight clubs investigations, High Court cases, and bashed prisoners will it take for her to admit that her prison privatisation agenda is a complete mess and a failure?

Hon JUDITH COLLINS: For goodness’ sake! It might shock that member to know that when we get an awful lot of very violent males together in a prison, sometimes they fight each other. None of that is acceptable, which is why when they do—as they do when the Department of Corrections runs the prison or whether Serco runs the prison—strangely enough they are all prosecuted under the prison regulations, and some of them actually get further penalties. So, actually, that happens in every prison. If only that member could actually go to visit someone other than Arthur Taylor, and visit some of the prisoners who are not indulging in that behaviour. [Interruption]

Mr SPEAKER: Order! I want less interjection from my right-hand side.

Mahesh Bindra: Has Serco reimbursed the Crown for any costs incurred as a result of the step-in at Mt Eden Corrections Facility; if so, has the reimbursement covered the cost of the seven managers, 10 principal corrections officers, and 30 officers employed by the Department of Corrections to perform the suspended services?

Hon JUDITH COLLINS: My understanding is that that is a matter that is being dealt with at the moment, and I cannot take that matter further.

Mahesh Bindra: Who, if any, has been covering the normal duties of these seconded staff while they are doing Serco’s job for them, and at what cost, and to whom?

Hon JUDITH COLLINS: As to the cost, that is a matter that is being dealt with, and as to who is doing it, it is other corrections officers.

Prime Minister—Government Policies

10. Dr KENNEDY GRAHAM (Green) to the Prime Minister: Does he stand by all of his Government’s policies?

Rt Hon JOHN KEY (Prime Minister): Yes.

Dr Kennedy Graham: Will the Prime Minister commit not to introduce and pass any Trans-Pacific Partnership agreement-related legislation until the US Congress has ratified the agreement?

Rt Hon JOHN KEY: No.

Dr Kennedy Graham: Why is the Government seeking to pass laws to make it easier for foreigners to buy land, and harder for New Zealanders to access medication, when there is no guarantee that the US Congress will even pass the TPP agreement?

Rt Hon JOHN KEY: We are not.

Dr Kennedy Graham: If the US Congress does not pass the TPP agreement, will he guarantee to reverse all the changes that his Government may have made to our legislation?

Rt Hon JOHN KEY: This might come as a shock to the member, but this is a free-trade agreement between, in this particular instance, 12 countries. One of those countries is the United States—the member is clearly very wound up about that—but if the United States does not ratify the legislation then it is null and void with the United States, in which case we do not have anything to worry about.

Primary Industries—Beef Exports to Taiwan

11. BARBARA KURIGER (National—Taranaki - King Country) to the Minister for Primary Industries: What recent reports has he received on growth in beef exports to Taiwan?

Hon NATHAN GUY (Minister for Primary Industries): Recent reports show that New Zealand’s beef exports to Taiwan increased by 36 percent to $188.6 million last year. Trade with Taiwan has accelerated since our economic cooperation agreement came into force in December 2013. This agreement saw the tariff on New Zealand beef cut to zero from a previous rate of 46c per kilogram.

Barbara Kuriger: What impact is this trade deal having on the competitiveness of our beef exporters?

Hon NATHAN GUY: These latest figures confirm that Taiwan is now our third-largest beef market behind the US and Canada. Taiwan is also taking higher-value meat cuts, with the average value last year at around US$5.68 per kilogram. That compares with US$5.08 for the United States, and US$4.94 per kilogram for China. This has seen our beef exporters move from weaker markets where they face more competition. This shows the importance of trade agreements in both diversifying our export footprint and allowing our exporters to be more profitable and to be competitive in our international markets.

Barbara Kuriger: How will the Trans-Pacific Partnership (TPP) benefit our beef exporters?

Hon NATHAN GUY: Very good question. The TPP will save our beef exporters an estimated $60 million per year when fully implemented. This includes unrestricted access to the lucrative US market after 5 years, and an almost 30 percent reduction in tariffs to Japan over 15 years. This is the lowest beef tariff level Japan has ever agreed to in any free-trade agreement. It will save our beef exporters $18 million per annum at entry into force, and $48 million annually after 15 years. It is well summarised by the Beef and Lamb New Zealand chairman, James Parsons, who said that our negotiators “have secured the best possible deal for Kiwi sheep and beef farmers. The TPP will have a significant impact on the competitiveness of our exports”.

Question No. 12 to Minister

Hon DAVID PARKER (Labour): I raise a point of order, Mr Speaker. Speakers’ Rulings on page 170 make it clear, and I am quoting from Speaker’s ruling 170/2, that “The primary condition of asking a question of a Minister is that the Minister has ministerial responsibility for the subject matter of the question. If there is no ministerial responsibility, there can be no question.” Then making the same point is Speaker’s ruling 170/6, on the same page: “The Minister of Justice [in that case] has no responsibility for the actions of Ministers outside her own portfolio responsibilities. She cannot be asked to confirm something for which she is not responsible.” This question is in respect of New Zealand Trade and Enterprise conduct, for which Minister Joyce has responsibility and the Minister of Foreign Affairs has none. When the Clerk’s Office asked, at the request of the Minister, that this be transferred we made that point, but the transfer went ahead anyway. I ask you, Mr Speaker: is there now a new ruling that overrules Speakers’ rulings 170/2 and 170/6, which I have referred to? Because if there is that has very, very significant implications that the Opposition would very much enjoy.

Mr SPEAKER: I looked very carefully at this matter, because I thought the member might well raise it. The first point I would like to make is that within the Standing Orders there are no particular rulings around transfers. I then refer to a number of other pages of rulings that have been given by various Speakers to the House. The member may want to start with page 167, particularly Speakers’ ruling 167/4: “It is not for the Speaker … to determine which Minister has responsibility for a question.”, or, further, Speaker’s ruling 168/1(1): “The Government has the right to transfer a question,” etc. What I then did is I went back and looked at the number of times this issue has been raised in the House over the last 6 months, approximately. This particular Saudi sheep issue has been the subject of 14 questions to Ministers, seven of which have been answered by the Prime Minister, six of which have been answered by the Minister of Foreign Affairs, and one of which has been answered by the Minister of Trade. In determining whether I would not allow a transfer, I need to consider whether the only reason a Government is seeking to transfer a question is an attempt to dodge giving an answer to the question. I think when you look at where the questions have gone in the past to be answered, and the very fact that the Cabinet paper that was tabled in the House was indeed tabled by the Minister of Foreign Affairs, I cannot conclude that in transferring it to the Minister of Foreign Affairs this Government is attempting in any way to thereby dodge the question that has been asked. The question that has been asked is one that is similar to the other 14 questions that have been asked, so I am quite comfortable with the transfer to the Minister of Foreign Affairs occurring. I do want to conclude by saying that there is a ruling, Speaker’s ruling 168/1(2), that says that once the question is transferred the Minister to whom the question is transferred must be in a position to answer supplementary questions. So if the question is to continue—if the member wishes to leave the question on the Order Paper and ask it—I will be watching very carefully any supplementary questions that flow.

Hon DAVID PARKER (Labour): If I may just speak to that ruling—

Mr SPEAKER: I will allow the member to do so.

Hon DAVID PARKER: —the difference between this question and earlier questions of the Minister of Foreign Affairs and, indeed, the Minister of Trade is that they were going to the nature of the deal and the earlier payments. This is, actually, the administration of a contract by New Zealand Trade and Enterprise. It was New Zealand Trade and Enterprise that were at the select committee last week, and the Minister responsible is the Minister for New Zealand Trade and Enterprise, Mr Joyce.

Mr SPEAKER: If the question was to then be referencing New Zealand Trade and Enterprise, the member might well have a point, but the question simply asks who now owns the abattoirs, I think the Minister of Foreign Affairs can give an answer to that. It similarly asks whether spending has ceased since a particular date. I would be surprised if that cannot be answered. So I suggest the member proceed.

Trade Agreements—Saudi Agri-hub

12. Hon DAVID PARKER (Labour) to the Minister of Foreign Affairs: Who will own the abattoir at the Al Khalaf Agri-hub in the Saudi Arabian desert and how much taxpayer money has been spent on it since further spending was suspended in August 2015?

Hon STEVEN JOYCE (Minister for Economic Development): on behalf of the Minister of Foreign Affairs: Under the funding agreement, when equipment is sent to Saudi Arabia, it becomes the property of the Al-Khalaf Group. However, the ultimate ownership arrangements for the abattoir have not yet been finalised. That is a matter between the Al-Khalaf Group and the Saudi Government. Regardless of the outcome of those discussions, the agri-hub and the abattoir will provide a platform for New Zealand businesses to demonstrate their expertise and explore commercial opportunities in Saudi Arabia, where there is a network of 2,000 such abattoirs. In answer to the last part of the question, there was no active suspension of funding by New Zealand Trade and Enterprise in August 2015.

Hon David Parker: I raise a point of order, Mr Speaker. I would suggest that, on the basis that it was the Minister responsible for trade and enterprise who actually answered the question on behalf of the Government, that that question should have been to the Minister responsible—

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

Hon Gerry Brownlee: I make a contribution simply because the point of the question has been lost, and I may be able to help with that. The point is the Government makes the decision about which Minister can best answer a question. You gave the history of the Minister of Foreign Affairs dealing with this matter, alongside the Prime Minister, over a period of time. You then referred to the fact that should the transferred question go to a Minister who patently could not answer it, that would be an abuse. Quite clearly, the Minister for Economic Development is in a position to answer succinctly and appropriately for the Minister of Foreign Affairs. That is all that has happened here.

Mr SPEAKER: Are there any further supplementary questions? [Interruption] Is this a point of order?

Hon David Parker: Mr Speaker, are you going to rule on my point of order?

Mr SPEAKER: I am going to hear from James Shaw.

James Shaw: I raise a point of order, Mr Speaker. In reference to the Minister’s answer to that question, given that it was a question on notice, he did not actually say how much taxpayer money was spent since August 2015. He said that it was not suspended. And I think that given that it was a substantive question that he would have been able to answer how much taxpayer money has been spent since that date.

Mr SPEAKER: Can address the first point. If the Minister then answers that it has not been suspended, then the question has been addressed. It may not be satisfactory to the member, and I suggest maybe a supplementary question may be useful. With regard to the issue of transfer, we have covered the fact that the Government has the right to transfer the question; it did so. I am then not privy to whether a Minister is in the country, out of the country, etc., and who ultimately might answer it. I do not think that makes a blind bit of difference to the rulings that you have contested, or to the rulings that I have given.

Hon David Parker: I seek leave to table the 20 August 2015 New Zealand Trade and Enterprise memo that said further funding is currently suspended.

Mr SPEAKER: Leave is sought to table that New Zealand Trade and Enterprise memo. Is there any objection? There is none; it can be tabled. Memo, by leave, laid on the Table of the House.

Hon David Parker: Was the Prime Minister correct when he said at the post-Cabinet press conference on 26 January 2016 that the multi-million dollar abattoir being built with New Zealand taxpayer funds will be owned by the Al-Khalaf Group and not the Saudi Government?

Hon STEVEN JOYCE: The Prime Minister is correct in terms of the equipment becoming the property of the Al-Khalaf Group. However, as I said in the answer to the primary question, the ultimate ownership arrangements of the abattoir have yet to be finalised. That is a matter between the Al-Khalaf Group and the Saudi Government.

David Shearer: This is a joke.

Mr SPEAKER: Order! This is a point of order. I need to hear it in silence.

Hon David Parker: I seek leave to table a briefing that was prepared for the Ministry for Primary Industries, it looks like just prior to 1 March 2014, when it said that the Saudi Government owns all 2,000 slaughterhouses in Saudi and that the abattoir was going to be gifted to the Saudi—

Mr SPEAKER: Order! Leave is sought to table that particular briefing. Is there any objection? There is none; it can be tabled. Briefing, by leave, laid on the Table of the House.

Hon David Parker: Can he confirm that that briefing, which I just tabled, stated that the abattoir will be gifted to the Saudi Government, which has been condemned internationally for human rights abuses, including recently mass public executions of its political opponents?

Hon STEVEN JOYCE: To the issue at hand, the Al-Khalaf Group will receive the equipment. It is very keen, I understand, to own the abattoir privately. The member points out that most abattoirs, if not all, in Saudi Arabia currently are owned by the Government. That is a matter of ongoing discussion between the two.

Hon David Parker: Which of the four official versions that we have had recently is correct: the one who said in the memo that funding for the abattoir was suspended; the one yesterday who said that funding was suspended pending clarity about who will own the abattoir; the one who yesterday afternoon said that funding was not suspended, because there is no need to release further funding; or the New Zealand Trade and Enterprise chief executive, who said the “suspension” was not helpful, only going on to describe the suspension of funding?

Hon STEVEN JOYCE: The member is deliberately trying to confuse. The New Zealand Trade and Enterprise Chief Executive, Peter Chrisp, said yesterday—this is the comment that may be of interest to the member, given that he is confused—that in hindsight, the use of the word “suspended” in the board paper was not helpful and was open to be misinterpreted: “The board papers should have said that further payments were [simply] delayed until matters in relation to the abattoir development were resolved in Saudi Arabia. There was no active suspension by New Zealand Trade and Enterprise at any stage.” That was publicly reported yesterday.

Hon David Parker: Is not the truth that these officials are just being forced to cover for National’s disreputable deal, that even his own colleagues are now ducking for cover—

Hon STEVEN JOYCE: I raise a point of order, Mr Speaker. I think that where the member was heading in that question was disrespectful to the Minister of Foreign Affairs. [Interruption]

Mr SPEAKER: Order! [Interruption] I will hear the member when I get a bit of silence.

Hon David Parker: I think it is pretty disreputable to pay bribes to overseas—

Mr SPEAKER: Order! That certainly did not help the order of this House, and on that basis I will rule the question out of order.

Hon David Parker: I raise a point of order, Mr Speaker. Why was my question out of order?

Mr SPEAKER: Because of the tone of the question and then—[Interruption] Order! The member will resume his seat. The tone of the question was going to lead to disorder, as was clearly displayed, and then the point of order raised subsequently was definitely going to lead to further disorder. I have made a decision. The member does not have to like it, but he certainly has to accept it.

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

Mr SPEAKER: Is this a fresh point of order?

Hon David Parker: It is.

Mr SPEAKER: I will hear from the Hon David Parker.

Hon David Parker: Are politicians in the Opposition not allowed to allege corrupt or improper practices on the part of the Government? Is that the ruling, because—

Mr SPEAKER: No, that is not my ruling.

Hon David Parker: —it is a very unusual ruling in any Westminster parliament.

Mr SPEAKER: Order! No, that is not my ruling, and I have ruled, and if the member wants to have a look at Speaker’s ruling 23(5)—[Interruption] Order! If the member wishes to stay for any longer in the House—

Hon David Parker: There’s not much point.

Mr SPEAKER: OK, then the member can stand, withdraw, and apologise for that comment, or leave the Chamber. The choice is his.

Hon David Parker: I withdraw.

Mr SPEAKER: I said stand, withdraw, and apologise for that remark, or leave the Chamber. The choice is the member’s.

Hon David Parker: I withdraw and apologise.

Chris Hipkins: I raise a point of order, Mr Speaker. During his answers the Minister made a number of disreputable references to the member asking the question. If it is therefore going to be out of order to include disreputable references to a Minister in a question, is it therefore going to be out of order to include disreputable references to those asking them?

Mr SPEAKER: I did not detect any disreputable references to the member. I will look closely at the Hansard. I did not hear any at the time. There may not have been any. The member’s interpretation of some of the comments of the Minister might be slightly different from mine. I will certainly have a look at it.


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