Questions for Oral Answer
Questions to Ministers

Accident Compensation Corporation—Rehabilitation Policy

Rt Hon WINSTON PETERS (Leader—NZ First) to the Minister for ACC: Is she satisfied with ACC’s rehabilitation policy; if so, why?

Hon RUTH DYSON (Minister for ACC): The accident compensation legislation puts heavy emphasis on rehabilitation—the strongest emphasis ever. Rehabilitation is a dynamic process, and the Accident Compensation Corporation is constantly working towards improvements for better quality and timely outcomes for claimants. This includes finding better ways to work with those claimants. The corporation’s philosophy is consistent with the legislation, and on that basis I am satisfied that its approach is well founded.

Rt Hon Winston Peters: Is the Minister aware that Accident Compensation Corporation rehabilitation programmes, such as the work preparation programme provided by Alpha Consultants in the Waikato, require accident victims to undertake a nasal enema by pouring water into their noses, sit cross-legged on the floor with their thumbs in their ears, humming, and also being forced to stand in a paddock and laugh at each other; if so, how can she have any confidence whatsoever that such seemingly pointless exercises provide any genuine rehabilitative qualities or effect?

Hon RUTH DYSON: It is a temptation to say that is quite enough information, but it is new information to me. It is information that I find very interesting, and I will be following it up with some vigour.

Hon Mark Gosche: What proportion of accident compensation claimants are successfully rehabilitated within a year of their injury?

Hon RUTH DYSON: I am advised that over 90 percent of claimants are successfully rehabilitated, measured by a combination of the rate of return to work, and positive assessments of claimants gaining maximum independence. By world standards this is a first-class achievement.

Rt Hon Winston Peters: What checks are undertaken by the Accident Compensation Corporation to ensure that people who are delivering these rehabilitative programmes are sane, and subject to appropriate scrutiny, thereby ensuring that accident victims are not captured by PC evangelists, intent on preaching their own non-scientific feel-good nonsense theories, at the expense of the taxpayer, and how would that help a woman with a shoulder injury?

Hon RUTH DYSON: The purpose of the work preparation programme is to ensure that claimants have assistance, particularly those claimants who have been away from work for some time and may be having difficulty re-entering the workforce. I am not sure that there is any psychiatric evaluation of the individual providers, but I am confident that the contracts the Accident Compensation Corporation issues to those providers have a very high outcome measurement, and I will be reporting to that member on the outcome measurements for the particular provider that he raised in the earlier supplementary question.

Rt Hon Winston Peters: When the Minister is providing us with this information, can she also inform the House as to how many people are forced to attend such rehabilitative programmes, and is this an example of the systematic nationwide scheme in action, or is it a case of one fruit loop having slipped through her inept quality control systems?

Hon RUTH DYSON: I understand that the work preparation programme is a 6-week course, which is being run by a variety of providers nationwide.

Hon Mark Gosche: Has the Minister received any reports recently on the satisfaction rates of accident compensation claimants?

Hon RUTH DYSON: Yes, I have. I can report to the House that the percentage of claimant satisfaction, as used in a measure through an independent survey, has increased from 71 percent in September 2001 to 83 percent in June 2003.

Rt Hon Winston Peters: I seek leave to table a synopsis of the aforementioned treatment delivered to a constituent, which included her viewing One Flew Over the Cuckoo’s Nest.

Document, by leave, laid on the Table of the House.

Genetically Modified Organisms—Community Management

2. JEANETTE FITZSIMONS (Co-Leader—Green) to the Minister for the Environment: Has she received a copy of the report “Community Management of GMOs” and what advice, if any, has she received on its contents?

Hon MARIAN HOBBS (Minister for the Environment): Yes, my office has received a copy of the report. I have been advised that appendix 1, the interim opinion of Dr Roydon Somerville QC, does not differ materially from the Crown Law advice to the Government.

Jeanette Fitzsimons: When she was quoted by Morning Report this morning as warning that councils wanting to use the Resource Management Act to create GE-free zones may face an expensive legal battle, was she threatening councils with a legal challenge to their plans and rules by central government agencies, or was she merely warning them that the international GE industry has very deep pockets, and might bankrupt their ratepayers?

Hon MARIAN HOBBS: No, I have never issued a threat. I have never said that local authorities cannot exercise their Resource Management Act powers to regulate GMOs locally. However, the legal advice is clear that there are high hurdles for councils doing so, which might expose them and their communities to legal expense.

David Parker: Is the Minister aware of any reports indicating local government attitudes to local control of GMOs?

Hon MARIAN HOBBS: Today, Morning Report reported that many councils appeared satisfied with leaving central government to make the hard decisions, rather than see local authorities take a piecemeal approach. Local Government New Zealand has yet to consider the matter.

Jeanette Fitzsimons: Why is it straightforward under the Resource Management Act for councils to prohibit the growing of pine trees in certain areas as a land-use control, but not GE crops?

Hon MARIAN HOBBS: That is interesting, because one can take the hypothetical example that should the Environmental Risk Management Authority give approval for a Crown research institute to grow genetically modified pine trees in Northland under certain conditions, and the Northland Regional Council attempts to oppose controls under the Resource Management Act, the council’s controls will have to be science-based and effects-based, just like those of the Environmental Risk Management Authority, and the Crown research institute will probably take them to task if they are not.

Jeanette Fitzsimons: Is she aware of a report to the European Parliament last year that stated: “The GMO-free region of upper Austria has become a magnet for seed firms and has attracted foreign investment, because strict business rules can be complied with here. In such a situation, retaining GMO-free status may represent the most economic and effective measure for co-existence.”, and does she support the right of New Zealand councils to exploit such economic potential for their regions?

Hon MARIAN HOBBS: No, I am not aware of that Austrian report.

Foreshore and Seabed—Crown Title and Mâori Customary Title

3. Dr WAYNE MAPP (National—North Shore) to the Associate Minister of Justice: Will she rule out Mâori customary title co-existing with Crown title, given her statement yesterday that “confusion has arisen” because of the term customary title?

Hon MARGARET WILSON (Associate Minister of Justice): The confusion has arisen because there are two systems to record land titles in New Zealand: the land transfer system, and a separate system devised and run by the Mâori Land Court. Underlying those two systems of land title, there are also common law rules relating to customary title, which is also known as aboriginal or native title. The term “title” is often used interchangeably, but it does have different legal meanings. As to the specific provisions of the legislation, the member will have to wait until the bill is introduced to Parliament.

Dr Wayne Mapp: If the Government has given away public domain and customary title, and is retaining the High Court’s jurisdiction, what is actually left of the Government’s 17 December policy?

Hon MARGARET WILSON: As I said, the member will have to wait until the bill is introduced in the House to see how those matters have all been addressed.

Mahara Okeroa: Will the acknowledgment of an ancestral connection to the foreshore and seabed affect the public’s right of access to the foreshore and seabed?

Hon MARGARET WILSON: No.

Dail Jones: When will the Minister draw to the attention of the National member Mr Mapp the well-stated principle set out in Adams’ Land Transfer Act at page A1115 that a Mâori title, ordinarily speaking—it quotes land over which the Mâori title has not been extinguished—is for “land beneficially owned by Mâori in respect of which, either by Crown grant or otherwise, no estate in fee simple has been created.” That law was simple until the Te Ture Whenua Maori Act was concerned, and will she also confirm that that Act was introduced by National?

Hon MARGARET WILSON: I agree with the member. I think he has just made the point that this matter is not for amateurs. It is, in fact, quite complex. The answer is that he is right.

Hon Peter Dunne: Will the Minister also confirm that if no action is taken to clarify issues relating to customary title, customary rights, Crown title, public domain, etc., then the status quo that remains will be the situation as ruled upon by the Court of Appeal in June last year—namely, that those matters can in part or in whole be determined by the Mâori Land Court—which most New Zealanders expressed themselves to be unsatisfied with and unhappy about at that time?

Hon MARGARET WILSON: The member is correct. Of course, one of the remedies under the legislation that that court can award would be a fee simple title, which would mean an exclusive title.

Dr Wayne Mapp: How will the Government’s new proposals incorporate customary rights, and in what way will they differ from existing customary usage of mâtaitai and taiapure?

Hon MARGARET WILSON: The matters are different, as the member has indicated. As I have said before, he will have to wait until the bill is introduced to see the detail that will address that matter.

Hon Richard Prebble: Will the Minister rule out Mâori having rights to the foreshore that are not available to other New Zealanders; if not, why not?

Hon MARGARET WILSON: Those matters will be addressed in the bill that will be introduced into Parliament in the near future.

Hon Richard Prebble: I raise a point of order, Mr Speaker. Maybe at some time in the future all sorts of things will be addressed. I mean, in the end we will get to Judgement Day. But today is question time, and I think I asked a perfectly reasonable question. The Minister is prepared to answer questions from members on the Government side of the House and is prepared to answer questions from parties that support the Government. I do not support the Government, but I was asking a perfectly reasonable question: will the Government rule out Mâori having special rights? That is a pretty simple question, so why can she not answer it?

Mr SPEAKER: The member makes a reasonable point and asked a reasonable question. The Minister gave a reasonable answer, addressing the question.

Dr Wayne Mapp: What form of co-management will Mâori have of the seabed and foreshore, in light of her statement yesterday that that idea promoted by the Minister of Mâori Affairs will be incorporated in the legislation?

Hon MARGARET WILSON: That matter will be addressed in the bill that will be introduced into Parliament in the near future.

Dail Jones: I seek leave of the House to table Adams’ Land Transfer Act, page A-1115.

Document, by leave, laid on the Table of the House.

Kiwibank—Success

4. CLAYTON COSGROVE (Labour—Waimakariri) to the Minister of Finance: What reports has he received on the success of Kiwibank?

Hon Dr MICHAEL CULLEN (Minister of Finance): Kiwibank has met or beaten all its financial and performance targets since it opened for business in February 2002. It can now boast 290 outlets and more than 200,000 customers.

Clayton Cosgrove: What risks, if any, are there to Kiwibank’s future?

Hon Dr MICHAEL CULLEN: Not indeed competition, because Kiwibank faces enormous competition from very much larger-funded, Australian-owned banks. The greatest risk would be a change of Government, given comments on Holmes last night that indicate that Dr Brash would definitely want to sell Kiwibank.

John Key: If Kiwibank is so successful, why does it need to be propped up with revenue from New Zealand Post’s red ticket arm and bill-paying services to the tune of $35 million a year, and does he agree that redirecting this revenue from one arm of New Zealand Post to another is just a snow job to hide much larger losses?

Hon Dr MICHAEL CULLEN: No, not at all. Indeed, Kiwibank is clearly on target for making a profit next year, as its business plan indicated. One of the reasons—[Interruption] The chairman is a former National Party Prime Minister who, having made the same mistakes as Dr Brash and sold a New Zealand-owned bank, has since seen the error of his ways and chairs Kiwibank.

Rt Hon Winston Peters: Can the Minister of Finance advise the House and the country as to whether he knows of any OECD nation where, in the last 7 years, the trading banks have made the same size of profits as the banks operating in New Zealand, and is that his idea of competition—as espoused by Dr Brash on television last night?

Hon Dr MICHAEL CULLEN: The member is correct that foreign-owned New Zealand banks have made exceptionally large profits in recent years. One of the achievements of Kiwibank has been to lead to quite a reduction in the fees being charged by those overseas banks, which means that from the Government’s perspective Kiwibank has succeeded in its first objective.

John Key: Why would the Minister think that a bank with total assets of well under 1 percent of the total assets held in the New Zealand banking system would have any material impact at all on the provision of banking services for New Zealanders, and why does he not just admit that the people most happy with New Zealand Kiwibank are the other banks in the New Zealand system, which have managed to give that bank the poorest, most unprofitable, worst accounts?

Hon Dr MICHAEL CULLEN: That was certainly a very revealing question. New Zealanders who do not have large wealth and large incomes—according to the National Party’s deputy finance spokesperson—are people not worth having in one’s business.

Mr SPEAKER: For some reason there seems to be a little bit too much noise at this moment.

Dr Don Brash: I raise a point of order, Mr Speaker. The Minister in no sense even attempted to answer the question Mr Key asked. There was no reference to the question at all in his answer.

Mr SPEAKER: I thought the Minister did address the question.

Rt Hon Winston Peters: In respect of the Minister’s first answer, is it his view that when a spokesperson on finance talks about competition in banking, the clear inference is that it is of benefit to the consumer, not just to shareholders, who may extract massive profits from New Zealand; and would that explain why the “great debater” has not asked a question in the House today?

Mr SPEAKER: The first question only can be answered.

Hon Dr MICHAEL CULLEN: I think the member is correct to suggest that the purpose of competition is to drive down costs, not simply to exist for its own sake. Of course, discretion is always the better part of valour.

Hon Trevor Mallard: I seek leave for an additional supplementary question to be granted to the National Party today, on the basis that the Leader of the Opposition, the finance spokesperson, use it forthwith.

Mr SPEAKER: If the member knew the Standing Orders, he would know that he cannot do that. [Interruption] The member will stand, withdraw, and apologise. I have made a ruling.

Hon Trevor Mallard: I withdraw and apologise.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. I realise that one cannot seek leave on behalf of another member, but with the House being the master of its own destiny, I think that it is quite possible for someone to seek an opening for one further question to be asked. I so seek leave now.

Mr SPEAKER: To be asked by the member himself?

Rt Hon Winston Peters: No, by anyone—hopefully the “great debater”.

Mr SPEAKER: The member can seek leave for that.

Hon Richard Prebble: I seek leave for Mr Peters to ask a further question. I know that he sought leave to go on the Holmes show and was ignored, and I know that Helen Clark very wisely did not turn up. The reason they are really upset is because Don Brash actually cleaned them up last night.

Mr SPEAKER: This is an interesting question, and I have been given accurate advice. Leave can be sought for an additional question, but then anyone can compete for it. I have to make the judgment. Is there any objection? There is not. One additional question can therefore be asked on this topic today. [Interruption] I call the Rt Hon Winston Peters.

Rt Hon Winston Peters: I want to hear from “Fearless”. Come on!

Mr SPEAKER: I have called the Rt Hon Winston Peters. He is entitled to ask a question if he wishes.

Gerry Brownlee: I raise a point of order, Mr Speaker. Of course we will let him ask it, but I heard Mr Peters say he wanted the House to hear from “Fearless”. Is he referring to himself? That would be far too humorous a description of himself.

Mr SPEAKER: The member’s attempts at wit are often only half successful.

Rt Hon Winston Peters: Has the Minister done a comparison of some the trading banks’ profit rates at the time when the economy was growing at 1 percent—when National was in charge—and the banks were making between 26 and 32 percent per annum, even without the marginal growth rate; and what sort of economic commentator would advocate that as being competition?

Hon Dr MICHAEL CULLEN: The member makes a very fair point. It is quite clear that to some extent competition existed more in terms of the number of banks than customers receiving a good deal from the services those banks provided. He also makes a fair point about the size of those profits. The Inland Revenue Department has been discussing with the banks the fact that their tax papers do not seem to reflect the amount of profit they have been making.

Mr SPEAKER: I am about to send somebody out.

Dr Don Brash: Can I ask the Minister why, if this—

Hon Richard Prebble: I raise a point of order, Mr Speaker. I apologise to the member, but I think I should raise this as a point of order now. We just heard the Minister of Finance give out confidential Inland Revenue Department information. To say that the department is investigating anybody appears to me to be a very serious matter for the member to be mentioning. Maybe I misheard him, but I would like him to clarify that, because it would appear to me to be a major breach of the security provisions of the Inland Revenue Department, and a misuse of the privileges of this House—if that is what I understood the member to be doing.

Hon Dr MICHAEL CULLEN: I am certainly debarred from giving taxpayer-specific information. That was not specific to any bank. It was about the banks in general.

Mr SPEAKER: All I can say is that that is not a matter on which I can rule.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. I specifically asked for one further question to be opened on this issue, and to leave it open, and I sought leave. Having given Don Brash the chance to balance— [Interruption] No, no, members should listen and they will learn. You have closed off question time for this question. [Interruption] Oh yes, he had, and Hansard will demonstrate it. I then sought leave for one extra question. Not just me—Mr Prebble did first. I sought it specifically in a way that could be granted, and it was granted. That question has been answered, and we should pass on to the next question and not give “Deputy Don” the chance to rise now.

Mr SPEAKER: No. I just want to say that the member should read the Standing Orders. The extra question was granted. The House can give leave. That is the 61st question and it does not count in the sums. Any member from any party in the House that has not used up its quota can still have supplementary questions to No 4.

Dr Don Brash: Why, if Kiwibank has been so successful over the last 2 or 3 years, does it still make up a banking system no bigger than Taranaki Savings Bank?

Hon Dr MICHAEL CULLEN: Kiwibank started from scratch with a capital of $83 million. Although that sounded huge to members opposite when it was being proposed, it is tiny for setting up a bank. It has captured well over 200,000 New Zealand customers in the space of 2 years.

John Key: Given the enormous interest in Kiwibank from Mr Mallard and other members, and given our desire to ask questions on this side of the House, I seek leave for another question on Kiwibank.

Mr SPEAKER: The member does not need leave. He can ask a question. [Interruption] All right. The member has sought leave for an additional question. This is a 62nd question. Is there any objection? There is, but the member is perfectly entitled to have a supplementary question.

John Key: If he is so keen on competition, and believes in the success of competition from Kiwibank, why has he asked to redirect into Kiwibank $35 million worth of original revenue that was never in the bank’s business plan, to prop up what is otherwise a failing institution?

Hon Dr MICHAEL CULLEN: It is certainly not a failing institution. It is, in effect, outperforming on forecast in terms of profitability. The synergies that Kiwibank achieves in terms of the internal business of New Zealand Post is one of the reasons why it has been able to offer reduced fees. For Mr Key, reduced fees for people on low incomes, with modest cheque accounts, may not seem important, but they are very important for ordinary New Zealanders—the people that party opposite is not interested in, in terms of banking.

John Key: I raise a point of order, Mr Speaker. I know the Minister wants to rant and rave about his position, but I would just ask you—

Mr SPEAKER: What is the point of order?

John Key: I asked him a very specific question. The amount of $35 million has been redirected from New Zealand Post into Kiwibank. It was not in the original business plan, and I asked the Minister to tell the House why he allowed that redirection to take place if Kiwibank is such a successful organisation. I would like an answer to the question, if I may.

Mr SPEAKER: The member did put in a comment about failing banks, and the Minister certainly addressed that part of the question. I heard him.

Contact Energy Ltd—Resource Management Act

5. Hon KEN SHIRLEY (Deputy Leader—ACT) to the Minister for the Environment: Why did she grant requiring authority status to Contact Energy Ltd in August 2000 as a network utility operator under section 167 of the Resource Management Act 1991, and in so doing what actions did she take to ensure that she complied with her statutory obligations?

Hon MARIAN HOBBS (Minister for the Environment): I approved Contact Energy Ltd’s application for requiring authority status because it satisfied the criteria in section 167 of the Resource Management Act. I assessed the application against the criteria in the Act and the advice of the Ministry for the Environment.

Hon Ken Shirley: Why did the Minister call for reports from officials to ensure that the interest of tangata whenua were protected, when she failed to consult or take any measures to protect the interests of the private landowners who are directly impacted by mile after mile of large, above-ground pipelines?

Hon MARIAN HOBBS: There are two points to that question. In answer to the last one, the environmental effects of miles and miles of pipeline are not considered when giving over requiring authority status. Instead, that goes before the Environment Court, as would any other consent. That is the normal process. I asked about the tangata whenua consultation because 2 weeks earlier to granting this, I had received correspondence querying the ability of another requiring authority to consult. One of the things I must take into consideration is that a requiring authority must show it can give proper regard to the interests of those affected.

Dave Hereora: As a requiring authority, would Contact Energy still have to apply for regional council consents for work on a designated site?

Hon MARIAN HOBBS: Yes. That would apply to the pipelines going across the land. Resource consents are still needed for all matters that fall within the control of a relevant regional council, such as approval for any discharges that might be required. Those consents would go through the normal assessment processes, including public notification, hearings, and rights to appeal.

Heather Roy: How can the Minister claim that she gave proper regard to the interests of those affected and the interests of the environment, as required by the Act, when the proposal involves a network of large, above-ground pipes that cross private property injecting large volumes of polluting waste water directly into the ground in a manner likely to damage the geothermal field—what was she thinking?

Hon MARIAN HOBBS: In considering an application for requiring authority status the Minister does not assess the environmental affects of any proposal. The proposal to inject steam back into the ground has to go through a consent process in the normal manner.

Hon Ken Shirley: On reflection, does the Minister still consider it appropriate to have granted this requiring authority status to a private company when the criteria in the Act for consideration of that deliberately require the Minister to gauge the impact on landowners and on the environment, and, clearly, there is an adverse impact in both those instances?

Hon MARIAN HOBBS: I have to consider that the applicant is likely to satisfactorily carry out all the responsibilities of a requiring authority, and will give proper regard to the interests of those affected and to the interests of the environment. I have to show that applicants will give proper regard; then they apply as normal to the Environment Court to get consents for the environment activities they will undertake.

Rates—GST Removal

6. PAUL ADAMS (United Future) to the Minister of Local Government: Does he stand by his statement to the House yesterday that “the removal of GST would not lead to a significant fall in rating bills, because local authorities would have to recoup their lost revenue in other ways.”; if so, why?

Hon CHRIS CARTER (Minister of Local Government): I stand by my statement that the removal of GST would not lead to a significant fall in rating bills. Exempting rates from GST would mean that the cost incurred by councils, in providing goods and services to their communities, would increase as they would no longer be able to recover the GST they paid on goods and services. This cost increase would have to be recouped by collecting additional revenue through rates. This answer clarifies, I think, my reference to revenue yesterday.

Gordon Copeland: I raise a point of order, Mr Speaker. We find ourselves in a degree of difficulty with the answer to this question, because, for the second day in a row, the Minister of Local Government has seriously misled the House in stating that the removal of GST would not actually affect the revenue of local bodies. It is a technicality, but that is achieved by zero rating—

Mr SPEAKER: Could the member tell me what the point of order is.

Gordon Copeland: I think the point of order is bound up with the convention that ignorance of the law is no excuse, and we are getting an incorrect answer, for the second consecutive day, and in a way that is misleading the House on this issue.

Mr SPEAKER: Well, the member does not like the answer, I presume from the comment he is making. The Minister was asked specifically whether he stood by his statement, and I heard him say that he did. I could not have thought of a clearer answer to the question. Whether it is the answer the member wants, is another issue.

Paul Adams: I ask again, does the Minister concede that he was embarrassingly wrong to assert, yesterday, that removing GST from rates would have little effect on rates bills, when every small-business man in the country knows that, by zero rating GST on rates, local authorities could still receive GST refunds on expenses; and, if he does not know that, may I offer the Minister a briefing on this, following question time?

Hon CHRIS CARTER: No, and I inform the House that I invited this member this morning to come to my office to talk about it, and I am happy still to do that.

Mita Ririnui: Why has the Government not removed GST from rates?

Hon CHRIS CARTER: GST is designed to apply to the widest range of goods and services supplied in New Zealand. This ensures that the tax is as fair and equitable as possible. The GST regime works best with few exemptions, as they can create distortions and extra compliance costs.

Paul Adams: Will the Minister reconsider his policy regarding GST being removed from rates, after we have our meeting after question time, as it would provide a big saving to ordinary residential ratepayers, because I fail to see any reason why he could not?

Hon CHRIS CARTER: Clearly, I am happy to talk about this further with the member on another occasion.

Corrections, Department—Iwi Consultation

7. Hon TONY RYALL (National—Bay of Plenty) to the Minister of Corrections: What is the total cost over the past 4 years for iwi expenditure for each of the Northland, Spring Hill, Auckland women’s, and Otago regional corrections facilities, including payments for cultural advisory services, tikanga advice, iwi communication, and other cultural assessment or management activities?

Hon PAUL SWAIN (Minister of Corrections): The total cost of iwi expenditure over the past 4 years is Northland, $467,985; Auckland women’s facility, $133,747; Spring Hill, $1,313,000.01; and Otago, $49,668. I am advised these payments are not broken down according to the categories the member has described.

Hon Tony Ryall: What limits will he place on this public largesse, and how do we know that anything will change, when the Minister says the spending is excessive but his department denies that and says the costs were appropriate?

Hon PAUL SWAIN: Firstly, it is still my view that the spending is excessive. That is the reason why I have called for the report. The second thing I will say is that, as the member knows, I have asked for future commitments to be brought to me for justification. I think, as far as largesse is concerned, it has to be said that approximately $277,000 was spent by the previous National Government on consultation over the Northland prison between 1997 and 1999, before any concrete was actually poured.

Martin Gallagher: Can the Minister outline to this House why we are building four new prisons?

Hon PAUL SWAIN: Yes. My colleague the Minister of Justice has recently released new prison forecasts that show a 20 percent increase in the prison population in the next decade to 7,400 inmates. This is in part due to the Government being tough on crime by changing the Bail Act, the Sentencing Act, and the Parole Act. This has resulted in longer sentences for the worst offenders and fewer offenders being granted bail. This means that four new prisons are needed.

Rodney Hide: When investigating this excessive spending by his department, will he include an investigation of the Department of Corrections payments to the company Jagcon over 4 years of $1,860,514—a company owned by John Hamilton, the project manager for the prisons—or is he just worried about excessive Mâori spending?

Hon PAUL SWAIN: I will be looking at that matter, but I can say that Mr Hamilton is an engineer and a former Department of Corrections person, so he is well qualified to look across the four sites as part of his brief.

Dr Paul Hutchison: Does the Minister agree with the guarantee that the Hon Matt Robson gave this House on 15 May 2002 that the $245,000 annual contract offered to the Waikato Raupatu Lands Trust to consult over the Spring Hill Corrections Facility would be “used wisely”, and in the light of recent revelations does he now have a different view?

Hon PAUL SWAIN: I have never said that some of this consultation is not justified. In fact, consultation, as the member will know, is required under the Resource Management Act. I am looking into some of the individual figures that, as I have said before, I consider to be excessive.

Hon Tony Ryall: I raise a point of order, Mr Speaker. My colleague Dr Hutchison asked a very specific question as to a ministerial undertaking given by the Minister’s predecessor. The Minister did not answer that question.

Mr SPEAKER: I am sorry; I thought he did address that question.

Rodney Hide: Does it concern the Minister that over $11 million has been paid out to Mr John Hamilton in just 4 years without a tender process and with no accountability measures in place, or does he not know about that either?

Hon PAUL SWAIN: There are most certainly accountability measures. The member has to realise that these four prisons are the biggest expenditure on corrections facilities that New Zealand has seen for a long period of time. They are complicated projects, and it is important that they get up and under way as quickly as possible. From what I have seen, Mr Hamilton has done a good job.

Dr Paul Hutchison: Does he regard it as wise standard practice to pay a Tom Moana $131,000 for consultation services, which includes $120 an hour plus mileage for driving to Waitangi and back, and $120 an hour for reading and research, given that he was the same man who, in the same year as he was collecting the money, was convicted of 53 counts of fraud?

Hon PAUL SWAIN: I am aware of the things that member has said, and that is one of the things I will be looking into extremely closely.

Drugs—Antidepressants

8. SUE KEDGLEY (Green) to the Associate Minister of Health: When was he first advised that some antidepressant drugs can trigger dangerous side effects, such as suicidal thoughts, in adolescents?

Rodney Hide: That was 2 years ago!

Mr SPEAKER: That is Mr Hide’s final warning. The member had started the question.

Hon JIM ANDERTON (Associate Minister of Health): Neither I, as Associate Minister, nor the Minister of Health, has been briefed, although there is nothing unusual in that. But I am advised that Medsafe’s expert advisory committee on medicine safety—the Medicines Adverse Reactions Committee—has been reviewing data on the safety of antidepressants, in particular the selective serotonin reuptake inhibitor, known as SSRI, antidepressants, since June 2003.

Sue Kedgley: Will the Government be following the example of the British Government now that it has this information, in stopping general practitioners from prescribing most of these SSRI antidepressants for adolescents and children, because these drugs have been shown to have few, if any, beneficial effects, and considerable risks; if not, why not?

Hon JIM ANDERTON: I can advise the member, and the House, that the UK has not banned these drugs. Rather, it has contra-indicated, or in normal language strongly warned, against the use of them in children under 18 with major depressive disorder. The products are still on the market and doctors can still use them at their own discretion. Contra-indication is a warning, not a ban. Doctors are being warned against the use of SSRIs without specialist advice. Similarly, the United States and Australia have also issued statements and a warning to doctors, but no attempt has been made to ban continued prescribing.

Steve Chadwick: What action has been taken in relation to advising prescribers of these drugs?

Hon JIM ANDERTON: As information on particular SSRIs showed in 2003 that they should not be used in the treatment of children with major depressive disorder—that is, those under 18—letters were sent to doctors at that time. When the UK Committee on Safety of Medicines strongly warned against the use of all but one SSRI in children under 18 in December 2003, the Medicines Adverse Reactions Committee in New Zealand reviewed the UK reports. Based on that review Medsafe issued advice this month to doctors that the risk was, in its view, still unclear, and further data was being sought, but that doctors should only consider using the products for adolescents on the advice of psychiatric specialists.

Dr Lynda Scott: As these drugs have become more widely available in the last 4 years, why do we not have updated data on suicide rates—the last data being available for 1999-2000—to compare whether New Zealand still has the second-highest rate of suicide for males and the fourth-highest rate for females in the OECD?

Hon JIM ANDERTON: There are two separate issues really—one is the reporting of suicides. This is a complex issue because our suicide statistics are among the most accurate in the world and depend on reports from coroners’ inquiries, inquests, and so on. The latest reports will be released next month, which will take us up to 2001. That is far too long, and this Government has taken steps to improve the coroner’s position in New Zealand, and to professionalise it further, and to improve, through a variety of electronic means of data records, the way in which we report.

The second issue really is about the impact of these drugs on suicide, and as the member almost certainly knows, suicide is a very complex issue and cannot be pinned on one or other cause. If it could be, most of us would be very happy to see that solution followed.

Barbara Stewart: Does he believe that rather than focusing solely on the drugs themselves, those who have the authority to prescribe these drugs also need to be scrutinised, with a move towards limiting this authority to mental health experts, rather than local general practitioners, who are currently freely able to prescribe such drugs?

Hon JIM ANDERTON: I think we have to be careful not to jump to conclusions. One of the reasons that drug use in this area has increased is that there has been an improved diagnosis of depression in adolescents. Most of us of a vintage age can recall when this was probably not recognised by anybody. Now that it is recognised, there are modern drugs available—and these drugs that we are talking about are modern drugs. They are better than the drugs of, say, 10 years ago. Counselling and one-on-one discussion is still the front-line treatment for this kind of illness in adolescents, but drug therapy is there, and on advice—in the case of these particular drugs it is suggested to general practitioners that it be on advice of specialists—it is a back-up treatment that is obviously being more used by general practitioners now because of the nature of the new drugs that are available.

Judy Turner: When was he first advised of dangerous side effects, such as harm to the central nervous system, neurotoxicity, cognitive decline, psychosis, exacerbation of schizophrenia in vulnerable individuals, and damage to the respiratory, immune, and cardiovascular systems from cannabis use by adolescents, and is he surprised that the Greens do not support the banning of this drug?

Hon JIM ANDERTON: I do not, unless I request specific advice, get that kind of advice from committees, quasi-Government committees, that are set up with professionals to examine these kinds of issues. That is why Ministers do not normally get briefings or advice—because these committees act on the information and professional advice that comes through the literature and through the experience of doctors, and they act independently of the Government. It would only be on request or if a change of policy were indicated that Ministers would be informed or involved.

Sue Kedgley: Does it concern the Minister that recent evidence shows that Glaxo Smith Kline, the manufacturer of the antidepressant Aropax, knew as long ago as 1998 that Aropax had no beneficial effect on children with depression, but held back its data in order to “minimise any negative commercial impact”, and would the Government have acted earlier if it had had access to that data?

Hon JIM ANDERTON: The Government sets up these specialist committees so that the best information and the best advice can be followed in the use of these drugs, and in the advice to doctors and clinicians and so on. I can say that I regret reading the press release of the Green Party on this matter where there is some suggestion that the Government, or its advisers, is following this course of action only because it wants to protect drug companies. That is outrageously wrong, and I suggest that the facts should actually be checked out a lot more clearly by the Greens before they issue such releases.

Sue Kedgley: Does the Associate Minister agree that consumers as well as doctors have a right to know the side effects of these drugs, and will the Government therefore be warning the thousands of unsuspecting New Zealand parents whose children are taking these drugs unaware of the potentially serious side effects of them?

Hon JIM ANDERTON: Yes, of course I do agree that patients, ordinary New Zealanders and others, need to know and have a right to know the side effects. They are usually quite complex—and there are side effects from everything. I suggest to the member that this applies both to chemical drugs and natural remedies, as well.

Sue Kedgley: Does the Minister consider that an acceptable way to treat depressed children in New Zealand is for Glaxo Smith Kline to suppress the information about the lack of beneficial effects of Aropax on children while general practitioners were prescribing Aropax to children, presumably in complete ignorance of the true data?

Hon JIM ANDERTON: Politicians are well advised to rely on specialist advice in those areas; they are complex. If anyone wants to stand up in this House, or anywhere else in New Zealand, to propose themselves as experts on depression and suicide, they should take a 7-year course in it before they even begin.

Sue Kedgley: I seek leave to table an internal document from Glaxo Smith Kline that shows that the company was not intending to table negative data.

Document, by leave, laid on the Table of the House.

Corrections Bill—Management and Rehabilitation Plans

9. RON MARK (NZ First) to the Minister of Corrections: Has he received any advice regarding the liability risks posed by legislating within the Corrections Bill that the Department of Corrections must devise individual management plans and rehabilitation programmes for prisoners; if so, what information has he received?

Hon PAUL SWAIN (Minister of Corrections): I am advised that some liability risk was identified in the early stages of the development of the Corrections Bill. However, those risks have been addressed by the inclusion in the bill of a requirement for the department to provide rehabilitative programmes “when reasonable and practicable in the circumstances, and within the resources available”.

Ron Mark: Is he aware that clauses 49, 50, and 51 of the Corrections Bill have increased the risk to the Department of Corrections of litigation from not only a released offender but, potentially, from any ensuing victim of a released offender; if so, what is he doing to alleviate those identified risks?

Mr SPEAKER: The Minister cannot be asked to give a legal opinion, but he may comment on the issue if he wishes.

Hon PAUL SWAIN: I shall not be offering a legal opinion. However, I can say that those matters were addressed as part of the development of the bill. The inclusion of the words I have read out substantially addresses those risks.

Russell Fairbrother: Why is the new corrections legislation required?

Hon PAUL SWAIN: The current Penal Institutions Act is now 50 years old and does not reflect modern policies and practices—in particular, that rehabilitation and reintegration have a place alongside containment and security. It also needs to be compatible with other criminal justice reforms passed recently—for example, the Sentencing Act, the Parole Act, and the Victims Right Act. The current Penal Institutions Act has been frequently amended, and is now in need of major revision.

Marc Alexander: What evidence can the Minister provide to back up his claim in Parliament yesterday during question time that “… the reality is that the integrated offender management system is proving to be very successful,” when reoffending rates have shown little signs of movement from an 87 percent recidivism rate within 5 years, and increased use of home detention is obscuring the real rate of reoffending?

Hon PAUL SWAIN: One of the sources of information is page 36 of the department’s annual report. If the member would care to look at that, it would tell him that, allowing for a 1-year follow-up period after release from prison, reconviction rates have declined from 43.5 percent of all offenders in 2000-01 to 39.7 percent in 2001-02. I think the Department of Corrections is doing a fabulous job in very difficult circumstances.

Ron Mark: Does he realise that the Corrections Bill in its current form potentially creates a liability risk that could be described as “notoriously uncertain”, and that the bill lacks predictability in its application of broadly framed rules to particular cases, and therefore “materially increases the chances of successful claims against the Crown”; if not, why not?

Hon PAUL SWAIN: No, I do not accept that. I have already advised the member that those issues were looked at in the development of the bill. It has been through the select committee process, which the member might have been a part of. Wording has been added, and we now have legislation that should stand the test of time.

Marc Alexander: Can the Minister advise the House whether, given the implied legislative right of prison inmates under clauses 49, 50, and 51 of his Corrections Bill to receive prompt assessment, individualised management plans, and rehabilitative programmes, he would consider returning the bill to the Law and Order Committee to reassess these liabilities; if not, why not?

Hon PAUL SWAIN: No. The select committee had a long period of time looking into this, and I am satisfied with the work that has been done. I hope the member will support the fact that a lot of work goes into rehabilitating offenders when they are in prison, in order to be able to reduce their reoffending when they come out. I hope the member will support that. After all, it is one of the things he has been calling for.

Ron Mark: I seek leave to table a legal opinion from Chapman Tripp on the Corrections Bill—specifically, on assessment, management plans, and rehabilitative programmes.

Document, by leave, laid on the Table of the House.

Literacy—Assessment Tool

10. Dr ASHRAF CHOUDHARY (Labour) to the Minister of Education: Is it the Government’s intention to expand the use of the asTTle assessment tool beyond years 5 to 7; if so, why?

Hon TREVOR MALLARD (Minister of Education): Yes. The assessment tool for teaching and learning (asTTle) allows teachers to assess students’ ability in core skill areas like literacy and numeracy, and to compare those results with national standards. It lets parents and teachers know learning strengths and gaps. The Government has just begun the development of version 3 of asTTle. It will include numeracy for students in years 8 to 10, and will be trialled in 55 secondary schools across the country this year. Version 4 will include literacy tests for years 8 to 10 and will be available from the beginning of 2005. This is part of this Government’s commitment to achievable high standards.

Dr Ashraf Choudhary: What advice has he received on the value of the asTTle assessment tool?

Hon TREVOR MALLARD: I am advised that asTTle is now becoming firmly embedded as a valuable resource for principals and teachers in New Zealand schools. It is also beginning to be used to evaluate professional development programmes, and to calculate achievement gains for various teaching and learning programmes. For example, asTTle will be used to gather, analyse, and evaluate project-wide data on student achievement in the literacy professional development project this year. It is a key part of improving standards, and has gained international recognition.

Community Employment Group—Hip-hop Study Grant

11. KATHERINE RICH (National) to the Minister for Social Development and Employment: What were the reasons that the Community Employment Group gave $26,000 to a woman to “do a whole lot of travelling for hip hop” when she admitted that she was “green” on her knowledge of hip hop, “Nothing major came of the trip, apart from seeing it all happen.” and that the Hawaii and Fiji leg of the trip was “basically to chill out.”?

Hon RUTH DYSON (Acting Minister for Social Development and Employment): The grant was given because the selection panel was satisfied that the application met the fund’s criteria, including the applicant having a proven track record as a social entrepreneur and the worth of the application to the community. As a result of recent statements on aspects of how the grant was used, I have asked the Community Employment Group to undertake a full review of the circumstances of the approval of this grant, of what it was spent on, and of the results that were achieved. I can also advise the House that the Social Entrepreneur Fund has been frozen since November last year.

Katherine Rich: Can the Minister tell the House whether any taxpayers’ money went towards any aspect of the couple of days in Paris that was undisclosed to the Community Employment Group, or towards the “chill out” in Fiji and Hawaii?

Hon RUTH DYSON: That information will be provided to me in the report that I have asked for, as referred to in the answer to the primary question.

Moana Mackey: Is she satisfied that the objectives of the social entrepreneur scheme are being met; if not, what changes is the Government proposing to make?

Hon RUTH DYSON: The Minister for Social Development and Employment has had a concern that grants made from that fund were not sufficiently directed to its purpose, which is to improve the social and economic well-being of disadvantaged communities by supporting key people who are working to make a positive difference in their areas. In August of last year he asked officials to undertake a review of the scheme. That review has been completed, and has recommended revised grants criteria. Those recommendations are due to be considered by Ministers shortly.

Dr Muriel Newman: Does the Minister believe that taxpayers got more value for money from spending $40,000 to create a bibliography of the spiritual make-up of Mâori or from giving $15,000 to Robert Reid, the failed Alliance candidate for Wellington Central, to complete a first-year course for a graduate diploma in economic development; and is that an indication that social entrepreneur grants are being given as a payback to political cronies and mates?

Hon RUTH DYSON: The irony of the example used is tragically wasted on that member, frankly. But I can confirm, as I did in the answer to the previous supplementary question, that the Minister for Social Development and Employment has had a concern about the application of grants made from that fund. That is why he asked for a complete review in August of last year, and that is why the fund was frozen in November.

Judy Turner: Is the Minister concerned about the value of such a trip, when the applicant herself has stated that: “I asked them for the money, told them what I wanted to do, and if the people wanted to buy into that, then that’s fine.”? In light of that, can she confirm that the actual number of jobs resulting from this junket is likely to be not many, if any?

Hon RUTH DYSON: Yes, I can confirm that I share the member’s concerns.

Katherine Rich: Does the Minister agree with Charlie Moore, the head of the Community Employment Group, who, after being asked on National Radio whether the hip-hop grant money was well spent, replied: “I certainly think it is. Yes, I do.”; if not, why not?

Hon RUTH DYSON: Not on first information, no.

Prisoners—Forecast Trends

12. TIM BARNETT (Labour—Christchurch Central) to the Minister of Justice: What trends are shown in recent Ministry of Justice forecasts of the prison population, and what reasons are given for these trends by the Ministry of Justice?

Hon PHIL GOFF (Minister of Justice): The Ministry of Justice’s annual update of forecasts of prison population predicts a rise of about 20 percent in the prison population by 2010, up to 7,400. The main reasons given for the increase are tougher sentencing legislation for serious crimes, and other policy initiatives that crack down on crime, including more police and higher rates of crime resolution.

Tim Barnett: What legislative initiatives are referred to in research as being responsible for serious offenders serving longer in prison?

Hon PHIL GOFF: Three pieces of legislation have resulted in tougher action against serious offenders. The research shows that the Sentencing Act of 2002 has resulted in longer sentences being imposed for serious crimes. At the same time the research predicts that the Parole Act of 2002 will increase the proportion of sentences that inmates actually spend in gaol, and under the Bail Act of 2000, it found that more high-risk, recidivist defendants were being denied bail. All of those Acts are good legislation.

Ron Mark: Has the Minister discussed the predicted increases of up to 20 percent with the Minister of Corrections, in particular with regard to the demands that will be placed on the Department of Corrections’ much-vaunted integrated offender management system, which it is currently failing to keep up, and over which it is likely to be exposed to undue fiscal risk?

Hon PHIL GOFF: I have discussed the projected increases with the Minister of Corrections, and he would advise the House that the four new prisons under construction or planned will cost over $600 million for capital expenditure, with operating costs of about $120 million a year. That is a huge investment. Most of us would rather spend that on health or education, but at the moment and in the short term the only way to keep offenders and recidivists off the streets is longer sentences. That is what we have done.

Ron Mark: I raise a point of order, Mr Speaker. I seek your assistance. I specifically asked not about capital development, bricks and mortar, or new prisons, but about the impact on the integrated offender management system. The Minister did not once mention those words in his answer. I ask him, through you, to answer my question.

Mr SPEAKER: Would the Minister like to make a brief comment on that?

Hon PHIL GOFF: I did mention the extra expenditure on operating costs, including the integrated offender management system. All of the material I have read on that indicates that it is a huge advance on what went before it.

Nandor Tanczos: How many more non-violent offenders does the Minister expect to lock up over the next 7 years, and does he really think that locking non-violent offenders in jail is the best way to rehabilitate them or keep them from a life of crime?

Hon PHIL GOFF: Prison is not good as a rehabilitative measure. I will acknowledge the point made by the member immediately. But I think he should realise that 60 percent of the inmates in prison are there for violent offences—in particular, homicide, sexual violation, grievous assault, and robbery. The property offenders there are not there because they have committed their first, second, third, fourth, or even fifth burglary; they are people who, every time they are let out of jail, are back breaking into your house and my house and other people’s houses in the community. The only thing that can be done with those sorts of people, unfortunately, is to take them out of circulation, and we are doing it.

Nandor Tanczos: I raise a point of order, Mr Speaker. While I appreciate the comments the Minister made, my question was how many more non-violent offenders does he expect to lock up over the next 7 years? I am genuinely interested to know what those projections are.

Hon PHIL GOFF: I am not sure what the projections will be. The property offenders currently in prison make up about 20 percent of the prison population. What the new legislation will do is ensure that people who are the most serious property offenders will spend longer in prison—as recent burglars did, getting 12 and 13½ years’ imprisonment after their 182nd offence.

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