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Parliament: Questions and Answers - Feb 21



Question No. 1—Finance

1. KIRITAPU ALLAN (Labour) to the Minister of Finance: What is the Government's initial response to the independent Tax Working Group report released today?

Hon GRANT ROBERTSON (Minister of Finance): The independent Tax Working Group report was released this morning, and I want to thank the group for its hard work and say that we will now spend some time working through the options and the recommendations it contains. We established the Tax Working Group to examine the structure, fairness, and balance of the tax system. Today's report finds that, overall, our tax system is clear and simple, but there is room for improvement. There is some unfairness that needs to be addressed. We will now work through the ways to do this to make the system as fair and as balanced as possible.

Kiritapu Allan: When will the full Government response be announced?

Hon GRANT ROBERTSON: As I say, we are taking technical advice on addressing the elements identified by the Tax Working Group, and will make further announcements in April on any measures to enhance fairness and integrity in the system, and we look forward to discussing the recommendations with our coalition and confidence and supply partners as we work to find consensus on the best overall package.

Kiritapu Allan: When would any changes arising from the report be implemented?

Hon GRANT ROBERTSON: I would like to reaffirm the commitment made when the Tax Working Group was established that no changes arising from the report will be implemented this term. We also set out some clear bottom lines: in particular, the family home is off limits, increases to income tax will not occur, and there will be no inheritance tax. Finally, as the working group has said, the Government is not bound to accept all the recommendations that have been put forward. There are options to accept some, or to phase or sequence aspects of the packages proposed by the group.

Kiritapu Allan: How does the Tax Working Group report fit with the Government's wider programme to modernise the economy?

Hon GRANT ROBERTSON: The Government's tax reform initiatives that are separate to the work of the Tax Working Group will continue while we consider today's report. We remain vigilant to ways that the current tax system fails to address the global economic and social forces which affect our economic activity. We've already made some moves to restore fairness and balance, including that announced earlier this week where we are taking steps to ensure that companies in the digital economy who do business across borders pay their fair share of tax. A discussion document on the options for the design of a digital services tax will be released in May, and we will continue to work with other countries for a global solution to make sure that multinational companies pay their fair share.

Question No. 2—Prime Minister

2. Hon PAULA BENNETT (Deputy Leader—National) to the Prime Minister: Does she stand by all her Government's statements, policies, and actions?

Rt Hon WINSTON PETERS (Deputy Prime Minister) on behalf of the Prime Minister: Yes.

Hon Paula Bennett: Does she agree with comments by the Rt Hon Winston Peters in regards to capital gains tax that, "They won't work in this country. They won't work in any other country. They never have worked."?

Rt Hon WINSTON PETERS: On behalf of the Prime Minister, the responsibility of the Prime Minister is for comments made by Ministers when they were Ministers, not beforehand. And, on behalf of the Prime Minister, I should not have to tell that member that.

Hon Paula Bennett: Does she agree with comments by the Rt Hon Winston Peters that, "You can't possibly go into an election saying, 'My tax policy will decided by a committee.' "?

Rt Hon WINSTON PETERS: On behalf of the Prime Minister, for the second time now, I am not responsible for comments made by members of Parliament before they held a ministerial warrant under my premiership. That's the substance of the matter and whether she agrees or not here's the fine point about a democratic constitutional Government: that is, we're going to consult with the people of this country in the next two weeks. [Interruption] I tell you what we can trust: somebody that hasn't got a massive vested interest in this case, somebody that hasn't got a massive vested interest in property, and is not now thinking about the country but just her narrow, selfish, egotistical self.

SPEAKER: I am going to remind the Deputy Prime Minister that he is speaking as the Prime Minister.

Hon Paula Bennett: No, no, let him go. Does she agree with the comments by the Deputy Prime Minister just yesterday who said, "The farming community, they are in for the long haul and there is no way a capital gains tax would have any effect on them at all.", when today's report says it will cost farmers $700 million a year?

Rt Hon WINSTON PETERS: On behalf of the Prime Minister, I have read the Deputy Prime Minister's comments on the farming show. I know that he comes from a seriously agrarian background and understands the long-term ownership aspirations and intergenerational aspirations of farming families around this country, and not one of them who aspires to that will be affected by any capital gains tax.

Hon Gerry Brownlee: That's not right. That's not right. Read it.

Rt Hon WINSTON PETERS: No, I've done some work in my time, son, not like you.

SPEAKER: Order! The pair of you.

Hon Paula Bennett: If the Prime Minister is correct in her comments, then why on earth would they be saying that it would cost $700 million a year if a capital gains tax is applied to farms?

Rt Hon WINSTON PETERS: On behalf of the Prime Minister, there is the rub. Who is saying that and what do they mean by "if"? I mean, the criteria would be whether or not this is an expanded tax, and at this point in time it is not. It's merely a report with a number of options—all 99—and what I'd like to know on behalf of the Prime Minister is: how come they had only four hours to study this and yet had already put out their views before the report came over their desks?

Hon Paula Bennett: Does she agree with the comments by the Hon James Shaw recently who said, "The only question we should be asking ourselves is: do we deserve to be re-elected if we don't." with regards to implementing a capital gains tax?

Rt Hon WINSTON PETERS: On behalf of the Prime Minister, that is a fact, and I'm glad about that. This is the first fact I've heard thus far in question time—that Mr Shaw said that. Mr Shaw's a visionary Minister and is looking to the full debate and discussion that's going to take place over the next eight weeks. Why don't we all show some patience and be prepared to consult with the public of this country, the businesses of the country, rather than give your own narrow venal views.

Hon Paula Bennett: Can she confirm that any changes as a result of the recommendations in the Tax Working Group's report will be revenue-neutral?

Rt Hon WINSTON PETERS: On behalf of the Prime Minister, it's very difficult to come to a report—

Hon Paula Bennett: Grant just told you to say that you haven't made any decisions.


Rt Hon WINSTON PETERS: Unlike that member, doesn't need instructions, able to think for himself, doesn't need a speech writer, not embarrassed by being shown up every day—no. On behalf of the Prime Minister, the Prime Minister and her colleagues are not going to come to a decision until they have had the full consultation. And I must say, the most interested person in this is the Minister of Finance—the consultation process—and when that consultation is finished, we will share with the public our findings.

Hon Paula Bennett: You got that right.

SPEAKER: Question No. 3, the Hon Amy Adams—sorry; just before you go, I am am just going to ask Ms Bennett to think about who she's interjecting to.

Question No. 3—Finance

3. Hon AMY ADAMS (National—Selwyn) to the Minister of Finance: Will he commit to ensuring that any changes the Government makes in response to the Tax Working Group's report are revenue-neutral to the Government?

Hon GRANT ROBERTSON (Minister of Finance): In light of the last answer, I could just say "What the Prime Minister said.", but no decisions have been taken on how the Government will respond on any aspect of the Tax Working Group's report released today. I would note for the member that the Government specifically asked the working group to include examples of revenue-neutral packages in the final report, and we are analysing those as we speak.

Hon Amy Adams: Why is he unable to commit to that, given that he has previously said about the Tax Working Group's programme, "We are not setting out in this process to increase or grab revenue from hard-working New Zealanders."?

Hon GRANT ROBERTSON: Because that's entirely true. We set out on this process to ensure that New Zealand has the fairest and most balanced tax system possible, and I would note that the last time there was a Government that had a Tax Working Group—a Government that member was part of—that working group recommended a capital gains tax, and a comprehensive one.

Hon Amy Adams: If this process is not about increasing taxes on New Zealanders, as he has admitted he said, why can't he commit to it being revenue-neutral? It's a simple question.

Hon GRANT ROBERTSON: Because we are working through all of the recommendations in the report, and I'd encourage the member to read the whole report, because when she does, she will see a range of packages that include, yes, some suggestions on expanding capital income and some suggestions on cutting taxes. We're working our way through the whole package.

Hon Amy Adams: Does he agree with the Tax Working Group that a bach, a plumbing business, or a hairdresser's salon should be subject to a capital gains tax but a multimillion-dollar art collection should be exempt?

Hon GRANT ROBERTSON: As I have said in all of my answers, we have not made any decisions about the recommendations of the Tax Working Group. We are working through them to make sure that New Zealand has got the fairest and most balanced tax system it can have.

Hon Amy Adams: Does he agree with the Tax Working Group that it's fair for corporates to be able to set off their capital losses but not families who own lifestyle blocks or baches?

Hon GRANT ROBERTSON: To repeat the earlier answer: we are working our way through the recommendations of the report. I think it would be good to respect the rights of New Zealanders to go through this report, make sure that their views are heard, and then the coalition Government and our confidence and supply partner will come back with a result.

Hon Amy Adams: Can he tell New Zealanders if he agrees with respected tax expert Robin Oliver, who's also a working group member, that the costs of the capital gains tax will far outweigh the benefits, it will discourage entrepreneurship, and have a negative impact on productivity in New Zealand?

Hon GRANT ROBERTSON: I'll be working through Mr Oliver's opinion, which is part of the minority report. I do note that within that minority report, Mr Oliver shares the view of all of the members of the Tax Working Group to extend capital income taxation to residential rental properties. So I presume that is now the National Party's policy, to endorse Mr Oliver.

Hon Amy Adams: Is it fair that someone who works hard all their life to build up a small business, create jobs, and save for their retirement faces losing a third of their assets on retirement, but a wealthy art collector with a multimillion-dollar home would be completely exempt?

Hon GRANT ROBERTSON: I don't believe the member's characterisation fairly represents the recommendation from the Tax Working Group, which we have not worked through, but I am pleased that she is focused on the issue of fairness, because that's why we set up the Tax Working Group, that's why we're prepared to actually answer the hard questions that come up for Governments from time to time, and we'll work through our response respectfully.

Hon Amy Adams: Does he think it's good enough that, having had the report for many days longer than anyone else, he still can't tell New Zealand whether it's his intention to increase taxes overall and still doesn't know, or won't say, what he thinks is fair?

Hon GRANT ROBERTSON: I think what New Zealanders would want from their Government is that that Government works through the report, and I understand why the member doesn't realise this, but actually this is a coalition Government. We're going to work across the three parties here that represent the majority opinion of New Zealanders, and we will come up with the solution for a fairer and more balanced tax system.

Question No. 4—Disability Issues

4. GREG O'CONNOR (Labour—Ōhāriu) to the Minister for Disability Issues: What recent announcements has she made to improve employment conditions for disabled people?

Hon CARMEL SEPULONI (Minister for Disability Issues): Yesterday, Minister Lees-Galloway and I announced a proposed approach to replace the minimum wage exemption to ensure all disabled people in New Zealand are paid at least the minimum wage. The proposal will end the minimum wage exemption scheme, which allows certain disabled people to be paid less than the minimum wage. It would be replaced with a wage supplement system, which both Government and the disability sector agree is the best option to address the needs of both disabled people and employers. The proposed model will ensure that disabled workers can continue to have job security and be in rewarding work, while providing every adult New Zealander with at least the minimum wage.

Greg O'Connor: Why is this important?

Hon CARMEL SEPULONI: Currently, around 900 disabled individuals in New Zealand have a minimum wage exemption permit. Many of these individuals are on extremely low wages; 70 percent of them receive under $5 per hour for their work. The disability sector has argued for some time now for an end to this discrimination against disabled people, and the Government agrees. The minimum wage exemption also conflicts with New Zealand's obligations under the United Nations Convention on the Rights of Persons with Disabilities. By ending the minimum wage exemption scheme, we can better support disabled people to live their lives to their fullest potential and foster more inclusive workplaces.

Greg O'Connor: What are the next steps replace the minimum wage exemption?

Hon CARMEL SEPULONI: We've started a two-month targeted consultation programme to gain insight and feedback on the wage supplement approach. The consultation process will explicitly target the views of disabled people, their whānau, representatives, and employers. This consultation reflects our commitment to "Nothing about us without us". Our two-month consultation is an important step in ensuring both employers and disabled people support the proposed change and have input into the design of the wage supplement approach.

Question No. 5—Regional Economic Development

5. Hon PAUL GOLDSMITH (National) to the Minister for Regional Economic Development: Does he think that increasing the tax burden on productive businesses would help or hinder investment into regional economic development?

Hon SHANE JONES (Minister for Regional Economic Development): The connection between investment and tax is a complex matter, and the introduction of any such tax is something that will be subject to both coalition discussions and widespread consultation with the very sector he's talking about.

Hon Paul Goldsmith: Does he accept that a lot of regional development depends on private sector investment—someone, somewhere, deciding to put their money into starting a new business and building it?

Hon SHANE JONES: Obviously, every day, Kiwis up and down the country, in agribusiness and related industries, are making investment decisions. They are increasing both in pace and sophistication as a consequence of my efforts.

Hon Paul Goldsmith: Does he expect that substantially increasing the tax burden on investment would lead to more investment in the regions?

Hon SHANE JONES: There is a famous song in the regions of New Zealand. It goes: "Go get your marbles, put 'em in the house, get a little dirt on your hands, son."

SPEAKER: No, the member will now answer the question.

Hon SHANE JONES: The man mentioned the word "regions"; I have responded in a very popular regional way. Of course, the regions are making investments all the time, and they will enjoy great consultation by my good self as we move forward on any tax changes. The reference to "get a little dirt on your hands, son" is the inverse relationship between Epsom and the regions.

Hon Paul Goldsmith: Does he think it would encourage entrepreneurship in the regions if the owners of small regional businesses, such as a sawmill in Northland, could build up their businesses over 30 years by reinvesting tax-paid profits only to be taxed again when selling it?

Hon SHANE JONES: Obviously, the travails of privately owned, small milling businesses—obviously, tax considerations are not necessarily uppermost but will be on their mind, which is why, as the Minister of Forestry, as the Minister for Regional Economic Development, I will engage with them, but I will not be taunted and I will not respond to verbal muck. I will respond to facts.

Hon Paul Goldsmith: What advice has he received on the impact on investment into the regions, first, from the uncertainty over the imposition of a capital gains tax or not, and, second, from the imposition of such a tax, if it was introduced?

Hon SHANE JONES: Obviously, over the last 24 hours the veritable Dr Cullen and his committee have released their report. Now that that report is public, I will turn my attention to studying its provisions and, in good time, we will discuss and debate its application to the provinces.

Hon Paul Goldsmith: Does he support introducing a capital gains tax for every business in regional New Zealand?

Hon SHANE JONES: Obviously, as the "First Citizen of the Provinces", I will engage with the regions. I will talk to the stakeholders along with other Ministers and other parliamentary members of the Government. And, in good time, we will arrive at a rational and sustainable conclusion. But we will not respond, as I've said earlier, to verbal mucus. We won't.

Question No. 6—Foreign Affairs

6. CLAYTON MITCHELL (NZ First) to the Minister of Foreign Affairs: Has he seen any reports on international incidents of slavery and human trafficking?

Rt Hon WINSTON PETERS (Minister of Foreign Affairs): [Interruption] Beg your pardon?

Hon Amy Adams: Carry on.

Rt Hon WINSTON PETERS: Can't you wait?

Hon Amy Adams: Not much worth waiting for.

Rt Hon WINSTON PETERS: Well, you're going to wait a long, long time if you keep on behaving like that.

SPEAKER: Order! Can I—

Rt Hon WINSTON PETERS: Well, she's all the time—

SPEAKER: No. The member will resume his seat. The Hon Amy Adams, you should know better than that, and, the Rt Hon Winston Peters, you should know much better than that. Don't take the bait.

Rt Hon WINSTON PETERS: It's like taking candy from a baby, Mr Speaker. This is a very serious issue and one that this Government is dedicated to fighting in each and every way. I've seen reports from Europol and Interpol which suggest that of the one million migrants who entered the European Union in 2015, nine out of 10 paid people smugglers to get them there. There are lessons to be learnt from Europe's experience, and international cooperation is vital in ensuring the inviolability of New Zealand's borders and maximising its national interests.

Clayton Mitchell: Does New Zealand have an issue with international people-trafficking?

Rt Hon WINSTON PETERS: Immigration New Zealand's website acknowledges that there is a lack of accurate information on the scope and scale of global people-trafficking and migration to New Zealand. This is often due to the lack of accurate data recording systems and a lack of information sharing between agencies, both domestic and international. Ultimately, New Zealand is not immune from the scourge of people-smuggling and human trafficking, which continues to affect much of the developed world, but what New Zealand will not tolerate is a degradation, particularly of women and children, while this happens.

Clayton Mitchell: What forms of international cooperation has the Government undertaken to help ensure that New Zealand is best prepared to address the issues surrounding international people-trafficking?

Rt Hon WINSTON PETERS: On 19 December 2018, the New Zealand Government along with 151 other countries voted in favour of the United Nations Global Compact for Migration.

Hon Todd McClay: Ha, ha!

Rt Hon WINSTON PETERS: The compact itself does not enable any party to think it's a joke, because it was the National Party that began the negotiations for it. New Zealand maintains full control of its own borders, retains its sovereign rights around migration policy—explicitly stated in paragraph 7 of the compact itself. It also ensures, in objective one, the collection and utilisation of data to help ensure that women and children remain seen by authorities, thereby reducing the risk that they will slip into invisibility and then, as is seen overseas, into wholesale abuse.

Clayton Mitchell: Is the Minister aware of any senior Government figures previously expressing their support for a Global Compact on Migration?

Rt Hon WINSTON PETERS: That's a very good question. Yes, the UN compact has earned support from figures across the political spectrum. The Speaker at the time realised—and he said—"New Zealand continues to be an open facing country, and to counter any xenophobia and intolerance of migrants", ultimately stating that "We pledge a concerted effort spurred on by the global compact." That was a speech that was approved by the leader of the National Party and the leader in the top echelons of the National Party, as Mr David Carter gave it to an Inter-Parliamentary Union conference in March of last year.

Hon Todd McClay: Can he explain to the House why there was so much confusion at the end of last year before he instructed New Zealand diplomats to go to the UN and sign up to this UN declaration, and can he also confirm media reports that there was one heck of a barney in Cabinet over it and that the Prime Minister got her way?

Rt Hon WINSTON PETERS: That puts me in mind of Geoffrey Palmer's famous warning about people spreading rumour with malice. There were two questions there; the second issue can I deal with first of all. This matter was never the subject of a raging debate in Cabinet. In fact, Cabinet colleagues so entrusted their foreign Minister, they let him handle it all by himself. As to the delay in the UN, it was because we were very cautious to ensure that as we gave our support for this document, all the criticisms that were emanating from the trolls internationally as to what it might mean would be debunked, and debunked they have been.

Hon Todd McClay: Just for absolute clarity: can the Minister, the Rt Hon Winston Peters, confirm that it was he and he alone that made the decision to sign New Zealand up to the UN migration treaty?

Rt Hon WINSTON PETERS: Well, I didn't take that arrogant attitude towards my duties. We approach it with consultative humility as being our central, core operational modus operandi, so to speak. But I can say that it never did go to Cabinet that way. I don't recall us having anything more than a peripheral discussion, because here we were inheriting a National Party - prepared document. We know that now and again the National Party does get it right, and in that sense we didn't have a dispute with them, but we just wanted to make sure—

Hon Dr Nick Smith: It was a sell-out.

Rt Hon WINSTON PETERS: —that the understanding was clear in this document. No, Mr Smith; selling out is your specialty.

Clayton Mitchell: How did the comments of UN migration compact compare to that of the New York declaration agreed to in 2016 by the previous Government?

Rt Hon WINSTON PETERS: Another good question. The reality is that in all respects, the National Party had signed up to this document. They had one of its leading members, a former Speaker, David Carter, give a speech to the IPU—that's a world body—last year bemoaning xenophobic behaviour, and I want to know what happened to the National Party's leadership.

Hon James Shaw: Is the Minister aware of reports that the false claims about the UN migration pact that he's just mentioned, about the right to migrate and limiting domestic legislation, were first popularised on social media by extremist anti-Islamic and neo-Nazi groups based primarily in Europe in September last year, and is he concerned that those false claims have been picked up by New Zealand political parties?

Rt Hon WINSTON PETERS: I am indebted to that member for asking that very pertinent question.

Hon Gerry Brownlee: I raise a point of order, Mr Speaker. There is a very, very unsavoury inference in the question that's been asked by the Green Party, and I think it is very much an unparliamentary question. It could be framed in a different way, perhaps, but not particularly sheeted home in the way it is intended.

SPEAKER: I am going to deal with that because it is a matter which I am separately aware of, the fact that there are international claims that some particular lines originated with the groups that the member referred to and that they are very similar to lines that have been used in New Zealand and overseas by people opposing the particular pact. Therefore I think it is a reasonable question to ask, as long as the foreign affairs Minister does not purport to speak for Opposition parties or to use this as a tool for attacking them.

Rt Hon WINSTON PETERS: I want to say I want to thank Mr Shaw for his question, because, frankly, when you've got debates and discussions and concerns about the involvement of certain interests against democratic outcomes in elections, this becomes a seriously important issue. Then when you see the extraordinary—not coincidence—duplication of the same phraseology, it leads one to suggest that this was what was going on. Above all, it behoves us not just in here but outside of Parliament—and, indeed, the media of this country—to be aware of just what the genesis and origin of some of these attacks might be.

Hon Gerry Brownlee: I raise a point of order, Mr Speaker. I would just challenge the way you've just ruled on, firstly, the reasonable nature of that question and it being parliamentary, and then the response from Winston Peters. There are several countries who moved that motion in the United Nations who did not sign up. Switzerland, for example, did not sign up. Does that mean that they are now branded by Winston Peters as being associated with the very unsavoury elements that Mr Shaw put in front of the House?

Rt Hon WINSTON PETERS: Speaking to that point of order, Mr Speaker. First of all, if there was any right of that member to raise that point of order, he had to raise it when the issue was first in front of the House, not when he feels like it—

Hon Gerry Brownlee: I did.

Rt Hon WINSTON PETERS: —no—not trying to give a ballast—[Interruption]—to an argument he'd lost.

SPEAKER: Order! No, the member will resume his seat. Mr Brownlee, you know that when a point of order is being spoken to, you do not interject. You know it very well, and the member will stop. I'm able right now to rule on Mr Peters' point. He is absolutely correct. While it was taken up directly, if the member had additional information at the time, it should have been taken up then and not afterwards.

Question No. 7—Small Business

7. Hon JACQUI DEAN (National—Waitaki) to the Minister for Small Business: Does he think small businesses in New Zealand are facing higher costs because of this Government's policies and actions?

Hon STUART NASH (Minister for Small Business): No.

Hon Jacqui Dean: Does he think any additional taxes will have an impact on small businesses?


Hon Member: What about GST?

Hon Jacqui Dean: Does he think—

SPEAKER: Order! No, the member can keep going. I just want whoever the member was up the back to be quiet and let her do it.

Hon Jacqui Dean: Does he think small businesses will be more or less productive with the introduction of additional costs, such as a capital gains tax?

Hon STUART NASH: As the Minister of Finance and the Acting Prime Minister have said—I'm assuming that member is referring to the release of the Tax Working Group's report earlier today—this Government has made absolutely no decision whatsoever on the way forward in that.

Hon Jacqui Dean: I raise a point of order, Mr Speaker. I did ask the Minister for Small Business a pretty direct question, which was, "Does he think small businesses will be more or less productive with the introduction of additional costs, such as a capital gains tax?"

SPEAKER: And the member got an answer.

Hon Jacqui Dean: Does he believe a capital gains tax on small business will discourage or encourage investment and innovation?

Hon STUART NASH: That's a hypothetical. I'm not prepared to answer that.

Hon Jacqui Dean: How does tax encourage investment and innovation?

Hon STUART NASH: Well, if you introduce a research and development tax credit like we've done to the tune of a billion dollars, what it does do is it encourages businesses to invest in research and development. If you put GST on online goods and services that are coming across from overseas, you level the playing field, so you help the 26,000 small retailers who employ 61,000 people—just two examples.

Hon Jacqui Dean: Does he think it is a good idea to tax goodwill on a business?

Hon STUART NASH: What I do think it's a good idea to do is to put GST on online goods and services to help mainstream retailers, and that is something that the Opposition refused to support. So could I suggest that if that member was really supporting small businesses, she would support GST on online goods.

SPEAKER: No, that didn't come close to addressing the question.

Hon Chris Hipkins: I raise a point of order, Mr Speaker. Ministers aren't obliged to give opinions. The question clearly asked for an opinion.

SPEAKER: They're not obliged to give legal opinions; they are obliged to give opinions answering questions on policy areas for which they are responsible.

Hon STUART NASH: As the Minister for Small Business, I'm not responsible for tax.

Hon Jacqui Dean: I raise a point of order, Mr Speaker. The question I asked the Minister was pretty straightforward. I asked him, "Does he think it is a good idea to tax goodwill on a business?", and the Minister in no way addressed that question.

SPEAKER: And he has, in that way, given an answer. I don't think it's that satisfactory, but it did address the question.

Question No. 8—Regional Economic Development

8. JENNY MARCROFT (NZ First) to the Minister for Regional Economic Development: What recent announcements has he made in relation to the Provincial Growth Fund?

Hon SHANE JONES (Minister for Regional Economic Development): Recently, the Provincial Growth Fund (PGF) that was announced will loan $7.5 million to support the development of Ōpuke Thermal Pools and Spa complex in Methven. It will create 120 jobs directly and indirectly, and it is fiscal evidence of the meaning of "ōpuke": to expand and swell.

Jenny Marcroft: What announcement has he made to help provide other alternatives to 1080?

Hon SHANE JONES: Naturally, the $19.6 million, which was announced by me and Minister Sage, is an overdue step to enabling the Crown to encourage and incentivise other interventions which go beyond the 1080 practitioners. This will not only lead and reward people who entrepreneurially or technologically come up with alternatives, which either can boost the prospects of ridding the landscape of such pests, but also generate, in time, foreign exchange earnings.

Jenny Marcroft: Can the Minister confirm claims that only 54 jobs have been created so far through the Provincial Growth Fund?

Hon SHANE JONES: I can confirm that the miserable, inaccurate amounts that were flung around earlier this year have now been eclipsed by the truth. The reality is that we are well beyond that figure: 10 times; 560 jobs created, and not only are they rising; they are being counted.

Jenny Marcroft: How many projects has the PGF so far supported?

Hon SHANE JONES: To date, the Provincial Growth Fund has supported 229 projects. Seventy of those, admittedly, are for matters that require further viability and feasibility and business cases, but such a standard is required in order for me to fulfil the good governance stewardship requirements of being the champion of the regions and the steward of the fund.

Jenny Marcroft: What recent updates and feedback has he received about the PGF?

Hon SHANE JONES: Naturally, there is an echo chamber from Murihiku to Muriwhenua, Invercargill to Kaitāia, and nowhere was it seen more vividly than when I was recently in mid-Canterbury, where the list member for Epsom was attacking mid-Canterbury but the sitting member was leaking early the results of our deliberations and celebrating this amount of money given to the Ōpuke thermal pools.

Hon Paul Goldsmith: If the Minister is so sure that he has now created 560 jobs, why did he say in this House before Christmas that he'd created 9,000? And given that wide variety, how can we have any confidence in any figures that he provides?

Hon SHANE JONES: Without a doubt, thousands of jobs have been both identified by my good self and are the subject of high-quality feasibility and viability studies. But as the member knows, the machinery of the State moves, from time to time, painfully slowly, and it requires us to tick all the milestones. But rest assured, the figure of 560 is not only authentic, but it is growing and swelling as we speak. And over the next 18 months, he can celebrate, along with me, the many thousands of jobs flowing from this incredibly important initiative.

Question No. 9—Whānau Ora

9. JO HAYES (National) to the Minister for Whānau Ora: Does this Government believe in the Whānau Ora model?

Hon PEENI HENARE (Minister for Whānau Ora): Yes.

Jo Hayes: How confident is he that all of his ministerial colleagues across Government parties will share his enthusiasm for increasing funding for Whānau Ora in Budget 2019?


Jo Hayes: Does he believe all his ministerial colleagues will be open to expanding and growing the model, as recommended by the panel?

Hon PEENI HENARE: In light of the review, I'm confident that this Government will be working hard to make sure that Whānau Ora as a model will continue to empower families right across this country. That member knows and understands the way that the Budget cycle works in this House, and I hope that in the coming months she will be alert to the announcements of positivity from this side of the House.

Jo Hayes: How long does he expect it to take for Te Puni Kōkiri to report back to him on where Whānau Ora can be implemented in the social sector?

Hon PEENI HENARE: Whānau Ora is already active and implemented in the social sector. I am confident, in light of the review, that this year there will be some significant movement in this space for the prosperity of our people.

Jo Hayes: What guarantees can he give to Whānau Ora providers who feel they've been left in limbo about their futures during the period of the review?

Hon PEENI HENARE: I give all guarantees to the Whānau Ora providers, far and wide, in this country. I want to thank them for their good work in the communities and the work that they do with families, and can I remind providers, the general public, and this House that Whānau Ora as a kaupapa is actually bigger than any one individual or any one part. The kind of fundamental shift that we want to achieve for prosperity for our families is far greater than any single one part.

Question No. 10—Māori Development

10. RINO TIRIKATENE (Labour—Te Tai Tonga) to the Minister for Māori Development: What recent announcements have been made about ensuring Te Reo Māori is a living language in Aotearoa?

Hon NANAIA MAHUTA (Minister for Māori Development): Today, I announced the launch of the Maihi Karauna at Te Matatini ki te Ao. The Maihi Karauna is the Crown's commitment to Te Reo Māori revitalisation, which has been publicly consulted on, as we determine our next steps. One of our goals is that by 2040, 1 million New Zealanders will be able to confidently speak basic Te Reo Māori. This is ambitious, as we take advantage of the momentum we are starting to see across Aotearoa. The Maihi Karauna will form the basis for the Government's strategic focus to protect and promote Te Reo Māori revitalisation across the Te Taura Whiri i te Reo Māori, Te Māngai Pāho, and the Māori Television service in the first instance, and in collaboration and partnership with Te Mātāwhai.

Rino Tirikatene: What initiatives will support the implementation of te Maihi Karauna?

Hon NANAIA MAHUTA: We will be commencing the implementation of this strategy through three initiatives which are focused on rangatahi—young people—and it will support our efforts for the Unesco Year of Indigenous Language 2019: initiatives such as snap Reo, which are micro-lessons; a social marketing campaign to promote the value of Te Reo Māori; and hosting rangatahi regional workshops and a national summit. All Government agencies will also begin to develop their own Te Reo Māori plans so that we can increase the Reo capability of our public sector. A comprehensive implementation plan is currently in development. It will set out what actions will be undertaken to achieve our priorities over a five-year period. The plan will be published in September 2019. I just want to congratulate Te Māngai Pāho, who are supporting a broader range of digital media content, which will extend the reach of Te Reo Māori to a wider audience and to young people, in particular.

Rino Tirikatene: How will the Government know if the Maihi Karauna is making a difference?

Hon NANAIA MAHUTA: That's a really good question. Effective measurement and evaluation will be critical to ensuring the success of the strategy, and we want to know that we're measuring the right things as we work together in collaboration to achieve this. A monitoring and evaluation framework will be developed to ensure that we're tracking these achievements. But, in short, I'm encouraged by the leadership of the Māori Language Commission and Te Taura Whiri i te Reo Māori, who are facilitating collaboration with all sorts of partners to get a better track of what's happening. Also, in the area of language planning, there is the start that has already begun across the public sector to ensure that they can implement the intent of the Maihi Karauna and the Māori Language Strategy.

Question No. 11—Energy and Resources

11. JONATHAN YOUNG (National—New Plymouth) to the Minister of Energy and Resources: What particular error or errors if any, does she believe NZIER has made in its calculations of the impact of her Government's oil and gas exploration ban outside onshore Taranaki, and what official advice, if any, has she received since the NZIER report's publication on what the actual economic impact will be?

Hon Dr MEGAN WOODS (Minister of Energy and Resources): My concerns sheet back to the Ministry of Business, Innovation and Employment (MBIE) modelling on which the New Zealand Institute of Economic Research (NZIER) report is based. As I said in answer to the member's question yesterday, problems with that modelling have been very well canvassed. Some of the concerns with the data are that (1) it does not take into account the 100 square kilometres of permitted area we are honouring and the pragmatic approach we are taking with current permit holders over drill or drop provisions, (2) it assumed that there would be no Government initiatives into alternative energy industries and the creation of associated jobs, and (3) it takes no account of the costs of doing—as the member seems to suggest—nothing. The report is based on a report by MBIE, which was based on a report by GNS Science, who said their own model attempted to quantify that which is almost unquantifiable.

I also pointed out yesterday that the report does not considered new jobs that may be created via the transition of our economy and growth of new industries. A number of studies point out that renewable energy sources create more jobs than fossil fuels. For example, a Pure Advantage report found that with proper investment almost 30,000 jobs could be created in areas such as the geothermal and bioenergy industries. A third report from Business and Economic Research (BERL) said that developing a bioenergy sector could generate up to 27,000 jobs. In answer to the second part of the question, none.

Jonathan Young: Is NZIER—

Hon Gerry Brownlee: It's all rubbish.


Hon Gerry Brownlee: I was spoken to by Dr Webb.

SPEAKER: But the member's response was delayed until his colleague was speaking.

Hon Gerry Brownlee: I was bullied.

SPEAKER: It is your fault, and you'll be more careful in the future.

Jonathan Young: Is NZIER incorrect to conclude that her Government's exploration ban will result in a $20,774 fall in household incomes each year for the next 30 years for every household in Taranaki; and if so, why?

Hon Dr MEGAN WOODS: Yes, because I believe the calculations that the NZIER report have produced are based on a flawed model that was in the original regulatory impact statement (RIS). I've just gone through in my primary answer all the reasons why I think there is a flawed methodology behind the data that is being used.

Jonathan Young: With official data showing less than six years of proved natural gas reserves left, when will the new technologies she believes will mitigate the economic impact, or transitioning away from natural gas, start to come on stream?

Hon Dr MEGAN WOODS: First of all, I don't accept the premise of that member's question. Actually, the latest MBIE projections are that we have 10 years of confirmed gas supplies in New Zealand, which has been the case for decades. It simply moves out. And, in fact, industry are making commercial decisions based on their own comfort with the level of gas we will have in New Zealand. We've had a $500 million investment from OMV in Taranaki. We've had Todd invest $100 million in a peaking plant. I don't think they concur with that member's view that the sky is about fall in.

Jonathan Young: I raise a point of order, Mr Speaker. I did quote from the departmental report from the officials to the Environment Committee when I worded the question of "proved natural gas reserves left", and the Minister's answer—

SPEAKER: Well, no. The member might disagree with an answer and he might even have evidence which shows that he's right, but there's never been a point of order which requires a Minister to change their view in that way. Ministers, believe it or not, in the past have been wrong in their answers.

Jonathan Young: Given that the scenarios used for NZIER's modelling are based on the Government's official analysis set out in their regulatory impact statement which accompanied the Cabinet paper prepared in support of the now enacted Crown Minerals (Petroleum) Amendment Bill, is she now saying that the regulatory impact statement was incorrect; and if so, how?

Hon Dr MEGAN WOODS: I said at the time the legislation was going through the House that I took issue with the data that was in the regulatory impact statement. In fact, the paper that I took to Cabinet refuted a number of the findings of the regulatory impact statement. This is not news, and, in fact, that member asked me questions about it last year in the House, and I gave him the explanations then.

Jonathan Young: What specific inputs to official data that NZIER has relied on does she argue is wrong?

Hon Dr MEGAN WOODS: I spelt this out in my primary answer, but I'll go over it again—

SPEAKER: No. The member doesn't need to—she did.

Question No. 12—Housing and Urban Development

12. SIMON O'CONNOR (National—Tāmaki) to the Minister of Housing and Urban Development: What percentage of homes added by Housing New Zealand in the 2017/18 period were purchased or leased?

Hon PHIL TWYFORD (Minister of Housing and Urban Development): I'm advised that the number of homes leased or purchased by Housing New Zealand reduced by 16 percent in 2017-18 from 67 percent down to 51 percent of the additional homes. During that period, Housing New Zealand built 1,033 homes, purchased 305, and renewed or newly leased 805 transitional and State homes. The percentage of new builds increased from 33 percent to 49 percent in 2017-18.

Simon O'Connor: Can the Minister confirm that Housing New Zealand missed its Auckland Housing Programme targets for the 2017-18 year—building fewer houses in Auckland, while buying and leasing more than planned?

Hon PHIL TWYFORD: What I can confirm is that Housing New Zealand substantially increased their new build numbers in 2017-18 over every build programme over the last five years—substantially—and it will almost double that in the year to come.

Simon O'Connor: Can he confirm—returning to Housing New Zealand's 2017-18 report—that, of the claimed 2,188 additional homes, 1,152 were purchased or leased, making 52.6 percent of all those additional houses being purchased or leased?

Hon PHIL TWYFORD: What I can tell the member is that leasing has increased. I'm advised that of the 805 leases by Housing New Zealand in the 2017-18 year, 795 were renewals of existing tenancies, with three- and five-year terms. All of those renewals—the whole 795—were of leases that were entered into by the previous Government.

Paul Eagle: What reports has he seen on Housing New Zealand's building and acquisition programme?

Hon PHIL TWYFORD: I saw claims yesterday on Breakfast TV that Housing New Zealand were building 1,500 homes in 2016. I was very surprised to learn that, so I did a bit of digging, and it turns out that of those 1,500 builds, two-thirds were not built, but were existing homes that the last Government leased or purchased.

Paul Eagle: Why does Housing New Zealand buy existing homes?

Hon PHIL TWYFORD: In the last financial year, our Government nearly halved the number of existing homes Housing New Zealand buys as we ramp up their build programme. However, Housing New Zealand will continue to buy some homes for a number of good reasons—for example, the need to acquire more homes for development projects or to rehouse tenants while homes are being built and because Housing New Zealand was previously told by the former Government that, in areas where it was planning to sell off State homes, it could not build additional homes—

SPEAKER: Order! Order! We've gone beyond the area of responsibility.

Simon O'Connor: Does Housing New Zealand purchase homes before they enter the open market, consequently removing an opportunity from taxpaying New Zealanders?

Hon PHIL TWYFORD: No. Housing New Zealand buys homes. It has an asset acquisition programme. It buys homes on the open market.

Simon O'Connor: Is the Minister aware of what his advisers and officials said in committee yesterday—that Housing New Zealand is using real estate companies to acquire houses before they reach the open market?

Hon PHIL TWYFORD: Like everybody who purchases homes on the open market, Housing New Zealand uses real estate agents, but they do not have—as the Opposition have been saying—some kind of sweetheart deal with one particular real estate agency.

Hon Gerry Brownlee: Yes, they do.

Hon PHIL TWYFORD: No they do not.

Hon Gerry Brownlee: He's not being told everything.

Hon Ruth Dyson: What about yours with Fletchers?

SPEAKER: Order! Both of you. Look, Mr Brownlee, you're not having a good day.

Simon O'Connor: Is it fair to first-home buyers—who were promised 1,000 KiwiBuild homes by 1 July—that when trying to buy a house they are competing with Housing New Zealand, who is willing to pay above market value, and has a budget of $1.3 billion?

Hon PHIL TWYFORD: First, Housing New Zealand does not pay above market value. It purchases on the open market. But this Government is focused on new builds—for the reasons that I have said—that's why we've cut the number of purchases by Housing New Zealand—

SPEAKER: Order! Order! The Minister has answered the question. He answered it in his first sentence.

Simon O'Connor: Is the Minister aware of what officials and advisers told the select committee yesterday—that Housing New Zealand is prepared to and does buy houses on the open market, up to, and sometimes beyond, 5 percent of market value?

Hon PHIL TWYFORD: Housing New Zealand has said—and I back them—that they buy homes on the open market on commercial terms, just like everybody else does. I want to point out to the member that of the 249 homes that Housing New Zealand bought, that amounts to 0.3 percent of the more than 72,000 homes that changed hands on the market last year. That is hardly likely to make a difference.

Simon O'Connor: Has Housing New Zealand taken six times as many houses out of private ownership in the last 15 months than the 62 houses KiwiBuild added?

Hon PHIL TWYFORD: I reject the premise of the member's question. His facts are wrong.

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