(uncorrected transcript—subject to correction and further editing)

THURSDAY, 17 JUNE 2010

QUESTIONS FOR ORAL ANSWER

QUESTIONS TO MINISTERS

Economy—Reports

1. AARON GILMORE (National) to the Minister of Finance: What reports has he received on the economy?

Hon BILL ENGLISH (Minister of Finance): The Westpac: McDermott Miller Consumer Confidence Index released yesterday shows an improvement in consumer confidence. It shows that the Budget tax cuts have generally exceeded expectations, and that a growing number of people believe they will be better off as a result of the changes. It is important, though, that despite growing consumer confidence, New Zealanders are choosing to save and pay down debt, rather than embark on another retail spending binge.

Aaron Gilmore: How does Budget 2010 make New Zealanders better off?

Hon BILL ENGLISH: The GST - income tax switch initially sees an average family with two children about $25 a week better off, a typical average-wage worker about $15 a week better off, and a superannuitant couple about $11 a week better off. Even when the emissions trading scheme, a small rise in rents, and other forecast general inflation are taken into account, the benefits of the tax switch increase over time. That is because after-tax incomes are forecast to grow more quickly than price increases in the 4 years to 2014.

Aaron Gilmore: How do the benefits of Budget 2010 tax changes increase over time?

Hon BILL ENGLISH: The benefits of the tax switch do increase over time. Taking into account all the forecast factors I have referred to, the benefit for an average two-child family increases to about $28 a week by October 2011, and then rises to about $41 a week by 2014. A typical wage earner is still about $15 a week better off in October 2011, rising to about $23 a week by 1 October 2014. Once the 170,000 new jobs forecast in the Budget are taken into account, total household disposable income from all sources, after tax, will increase by over 25 percent by 2014.

Hon David Parker: Why did he break his promise to New Zealanders by borrowing for tax cuts, and was it to increase Government debt to justify his privatisation agenda?

Hon BILL ENGLISH: No. As the Government pointed out at the time of the Budget, because we could not implement all the tax changes on 1 October 2010 there is about a $400 million cost that arises because of the timing difference, with the remainder of the package implemented on 1 April 2011. Over 4 years, though, the package is broadly fiscally neutral, and does not add to borrowing.

Hon David Parker: Has he seen the repeated statements by many of the main participants in the electricity industry, that the electricity industry bill will increase electricity prices in New Zealand rather than reduce them, and is he willing to intervene?

Hon BILL ENGLISH: The Government has been through a pretty thorough process reviewing the operation of the electricity market. There is a range of views about what impact it is going to have. The Government believes that the changes in the bill will lead to greater competition.

Aaron Gilmore: Has he seen any reports that sum up the intended effects of Budget 2010 tax changes?

Hon BILL ENGLISH: Yes, I have. In particular, I have seen a report from one individual who, when he was asked how he would use his tax cuts, said: “Pay down my mortgage and help my kids out a bit.” I can confirm that that quote came from Labour leader Phil Goff a day after the Budget. I can confirm that that is probably a view that most New Zealanders are taking, that they will use their tax cut to reduce their debt, and they will be pretty careful with their spending.

Pacific Economic Development Agency—Minister of Finance’s Meetings with Representatives

2. Hon ANNETTE KING (Deputy Leader—Labour) to the Minister of Finance: Was the Minister of Pacific Island Affairs correct when she said the Minister of Finance had met with the Pacific Economic Development Agency “on several occasions”; if so, who did he meet?

Hon BILL ENGLISH (Minister of Finance): I have a slightly longer answer. The answer is yes. I had a series of discussions with Pacific community groups that shared the Government’s deep concern about the effects of the recession on Pacific people, including 14 percent general unemployment, and probably higher among young people. Those meetings included ministers of churches, local government people, business owners, and the Pacific Island Chamber of Commerce. Discussions focused on following up on the Auckland Pacific Economic and Social Transformation Agenda—APESTA—conference held in October 2008 under the previous Government, which was sponsored by Government agencies, and was opened by the Auckland Regional Council chairman, Mike Lee. In December 2009, I addressed a public Pacific business forum in Māngere jointly hosted by the Pacific Economic Development Agency and the Pacific Island Chamber of Commerce. In February 2010 I attended a meeting hosted by the Pacific Economic Development Agency. I am advised the agency was represented by J R Pereira and Mose Saitala. People who are active in the Pacific community wear many hats, and I may have met with members of the Pacific Economic Development Agency in other capacities at other meetings. We need to remember that this is all about providing job and training opportunities for Pacific communities, which are facing 14 percent unemployment, and probably higher for young people.

Hon Annette King: Was the Minister of Pacific Island Affairs correct when she stated on Radio New Zealand this morning that the Minister of Finance had been in discussions with Mr J R Pereira, the contact person for the Pacific Economic Development Agency, about the project over a “fairly extended period of time”, and when did he first discuss this project with Mr Pereira?

Hon BILL ENGLISH: There was no project until about February this year. Prior to that, I had met with a range of people who were frustrated that there had been endless talk about economic development in the Pacific community but actually not much had occurred. Existing providers do their best, but, as that member will know, the resources available in the Pacific community are not extensive. When someone is proactive and takes an initiative, a Government should take that opportunity.

Hon Annette King: I raise a point of order, Mr Speaker. I quoted from the Minister of Pacific Island Affairs, who said that the Minister of Finance had been in discussions with Mr J R Pereira for an “extended period of time”, and I asked when he had first met with him. The Minister did not answer that question.

Mr SPEAKER: I will hear the Hon Bill English.

Hon BILL ENGLISH: As I have pointed out, people wear a lot of different hats in the Pacific community. I can go back and check when I first met with Mr J R Pereira. I expect that it was when I first met with the Pacific Island Chamber of Commerce. In my capacity as Minister of Finance I meet with chambers of commerce all over the country, and I was requested to meet with that one.

That may have been the first occasion, and it would have been in early 2009, although I cannot be sure.

Mr SPEAKER: This was a most unusual situation, and I took that further answer from the Minister as being helpful.

Chris Tremain: The Minister having attended a number of meetings with Pacific Island leaders, what measures did Budget 2010 take to improve the prospects of Pacific people?

Hon BILL ENGLISH: In a general sense, the tax switch involved in Budget 2010 will promote investment and employment, and the forecasts include 170,000 new jobs. That will make a big difference to a community that has been the hardest hit by unemployment.

Hon Annette King: When he said that it was critical that the Government continued to “responsibly manage public finances on behalf of taxpayers. We can’t take our eye off the ball.”, did he apply that standard to the funding proposal he received from the Pacific Economic Development Agency—a proposal that is 6 pages long, with two of the pages containing nothing more than statistics straight from Statistics New Zealand, and that seeks close to $4 million of taxpayers’ money?

Hon BILL ENGLISH: I am not sure just which proposal the member has seen, but that is— [Interruption] No, I am not, actually. That is not a description of the proposal that I received. Like every other proposal that is put to the Government, it will go through a thorough process of a purchase agreement, accountabilities, and good care of taxpayers’ money. I must say that is not unusual. The Budget includes tens of millions of dollars of contingency, where the accountabilities and the contracts are going to be negotiated over the next few months.

Hon Annette King: What other agency has had a project approved by him by simply writing a proposal that is 57-words long that has not been through any open and transparent process, does not have one word of detail, was emailed from Honiara, and seeks $1 million a year, as in the proposal to him for the Pacific Skilled Employment scheme?

Hon BILL ENGLISH: The member is simply wrong. I do not know what document she is referring to. It is certainly not the one that is being worked through now by Treasury and the Ministry of Pacific Island Affairs in order to come to a conclusion about appropriate contracts. We do not intend to let petty party politicking get in the way of making vital progress for a community whose young people are in desperate need of action after years of talk from the previous Labour Government.

Hon Annette King: Pretty words. Does he have any more written material from the Pacific Economic Development Agency, other than the 6 pages provided that were addressed to him and that the Minister of Pacific Island Affairs talked about on the radio this morning, to back up a proposal that he is prepared to hand out millions of dollars to; if he does have more material, would he please give it to the Minister of Pacific Island Affairs, because she has made it clear that she seen only the particular proposal that I am holding?

Hon BILL ENGLISH: Of course there is more written material than that member’s misrepresentation of it. As I said before, that is what is being discussed. Not one dollar will be paid out unless all the accountability is met. This initiative has arisen because the Pacific Island community is tired of the endless talk and no action that they got from the previous Labour Government. It is time to do something for young Pacific Island people, and not just sit around talking about them.

Hon Annette King: Was the Minister of Pacific Island Affairs correct when she affirmed on Radio New Zealand this morning that the Pereira family had been involved in brokering appearances or endorsements by members of the Pacific Island community during the election campaign; if so, did he know that before agreeing to $4.8 million for Mr J R Pereira’s project?

Hon BILL ENGLISH: I resent that implication. [Interruption] If the member really wants to know, the only Pereira I knew before was Tino Pereira, whom I understand was very close to the previous Labour Government. That does not mean he did not have something to contribute to the

welfare of Pacific Island people. That member will know that I have my own connections with that community by blood relationship. The motivation of the Government has been to deal with a problem that I know that party understands well, which is young Pacific Islanders who have low skill levels and no attachment to the workface, and who have been the group in New Zealand hardest hit by the recession. When that community produces a proactive initiative with sound business principles, it is an opportunity to take, not a problem to dismiss.

Hon Annette King: As Minister of Finance, why has he not insisted on an open, transparent process that allows other Pacific Island providers to have a go at $4.8 million, if he is serious about wanting to improve the lot of Pacific Islanders, because they are outraged at the process that he has allowed to take place?

Hon BILL ENGLISH: I actually do not think the Pacific Island community is outraged at a Government putting more money in a tight Budget into helping young Pacific Island people get jobs. If the member wants an explanation, I am a bit familiar with the matter, having been through these processes in Government before. There is not a depth of providers of business-related services in the Pacific Island community. There is one other one, the Pacific Business Trust; it was mismanaged by the previous Labour Government for the last decade, so it has had to be restructured several times. This proposition will enable more to be done by helping existing providers, and no dollar will be paid out until, or unless, all the purchase agreements have tight accountabilities and have annual signposts along the way.

Hon Annette King: I seek leave to table the funding proposal to the Minister of Finance of the Government of New Zealand, which is 6 pages long.

Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is objection.

Waste, Plastic—Farm Recycling Scheme

3. JOHN HAYES (National—Wairarapa) to the Minister for the Environment: What steps is the Government taking to reduce the amount of rural plastic waste being burnt, buried, or ending up as countryside litter?

Hon Dr NICK SMITH (Minister for the Environment): The Government is working with farmers and their support industries to recycle and reuse the plastic waste generated from, mainly, silage wrap. The nationwide Plasback scheme was one of the first accredited product stewardship schemes, and yesterday, at the Agricultural Fieldays in Hamilton, I announced the first grant from the Waste Minimisation Fund to support the programme.

John Hayes: What advice does the Minister have on what is currently happening to this plastic waste, and what will be achieved by the new scheme?

Hon Dr NICK SMITH: I have been advised that the bulk of the 7,000 tonnes a year of plastic farm waste is currently burnt, which results in the release of toxic chemicals into the air. A further portion is buried. The ambitious goal of this scheme is to establish a network of on-farm recycling facilities throughout New Zealand, with the aim of recycling 2,400 tonnes by July next year. The Government is working to lead the same sort of culture change that has occurred over the past decade or two with households, which now extensively use kerbside recycling, albeit the logistics of distance make the farm-based recycling of plastics more challenging.

John Hayes: What provision has been made to ensure that there are economically viable uses for the collected rural plastic waste—because I am aware that some recycling schemes have got into difficulty because they have not been able to use the collected waste economically?

Hon Dr NICK SMITH: Of course, it is important, as the member says, not just to collect the waste but also to have a practical use for it. The proposal that the Government is backing involves a recycling facility in Christchurch that is able to use the waste, including the dirty silage waste, and is able to remanufacture it into products that can be used, such as piping and bins. The scheme also

provides for the reuse of agricultural chemical containers, which, if left on farms, can result in pollution. This scheme involves the containers being reused, which I think is a good outcome.

Charles Chauvel: Can the Minister assure the House that none of the 966 tonnes of e-waste collected at last year’s eDay will end up in New Zealand landfills, and when, if ever, will he approve a product stewardship scheme to allow computer buyers to recycle their old computers at the point of purchase, so as to reduce the 80,000 tonnes of e-waste that ends up in New Zealand landfills each year?

Hon Dr NICK SMITH: I am quite concerned about what has occurred with regard to e-waste. Currently, a prosecution is before the court where a subcontractor to the 2020 trust was involved in the unlawful export of e-waste. I have asked my ministry to work with the 2020 trust to establish proper systems to ensure that e-waste is properly dealt with. A preferred option would be to have a recycling facility in New Zealand that is able to deal with the different waste streams, and the ministry is exploring whether there are possibilities to use funds from the Waste Minimisation Fund to support that.

Charles Chauvel: I raise a point of order, Mr Speaker. I wonder whether the Minister might address the question relating to the product stewardship scheme in this area—

Mr SPEAKER: I think that the Minister gave a pretty reasonable answer to a question that actually did not have a lot to do with rural plastic waste.

Pacific Economic Development Agency, Proposal—Ministry Advice

4. SU’A WILLIAM SIO (Labour—Māngere) to the Minister of Pacific Island Affairs: Did she receive advice from her ministry in relation to the Pacific Economic Development Agency proposal; if so, when?

Hon GEORGINA TE HEUHEU (Minister of Pacific Island Affairs): Yes, on 25 March 2010.

Su’a William Sio: Was the description on Morning Report wrong when it said the Pacific Economic Development Agency’s flimsy application had no budget, no delivery mechanism, no management structure, and no outcomes; if so, why?

Hon GEORGINA TE HEUHEU: Mr Speaker—

Mr SPEAKER: I just want to make sure that I heard the question correctly. The Minister has no responsibility for what a news agency might say. I may have misunderstood the question.

Hon Darren Hughes: I raise a point of order, Mr Speaker. The member asked whether the description that was aired was correct.

Mr SPEAKER: I accept the point the honourable member makes. I invite the member to therefore repeat his question.

Su’a William Sio: Was the description on Morning Report wrong when it said the Pacific Economic Development Agency’s flimsy application had no budget, no delivery mechanism, no management structure, and no outcomes; if so, why?

Hon GEORGINA TE HEUHEU: Yes.

Su’a William Sio: When she stated on Morning Report today that the Pacific Economic Development Agency appropriation is now multi-year and contestable, will groups have to apply through the Pacific Economic Development Agency or can they apply directly to her ministry in future financial years?

Hon GEORGINA TE HEUHEU: No.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. I know you will not rule that we must have yes or no answers, but when a Minister gets an either/or question, he or she cannot just say no.

Mr SPEAKER: I am always commending Ministers when they give brief, concise answers. The Minister said no, and I presume she meant that no, it was not contestable. If it was different, the Minister had better correct that impression.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. I think she was directly quoted as saying that it was going to be contestable. The question was whether it was contestable through the Pacific Economic Development Agency or contestable through the ministry.

Mr SPEAKER: To avoid confusion I ask Su’a William Sio to repeat his question and we will let the Minister hear it again to make sure she is satisfied she has given the House the answer she has intended.

Su’a William Sio: When she stated on Morning Report today that the Pacific Economic Development Agency appropriation is now multi-year and contestable, will groups have to apply through the Pacific Economic Development Agency or can they apply directly to her ministry in future financial years?

Hon GEORGINA TE HEUHEU: No, they do not have to apply through the Pacific Economic Development Agency.

Su’a William Sio: When will she admit to the New Zealand public and the Pacific community that this deal was forged in October 2008, committed to in 2009, stitched up in March 2010, and announced in May this year?

Hon GEORGINA TE HEUHEU: I have no responsibility for anything that was forged at the time that he said. I was not even a Minister of Pacific Island Affairs at that time.

Child Abuse—Victim Support Initiatives

5. KANWALJIT SINGH BAKSHI (National) to the Minister of Police: Can she provide a report on any recent initiatives to improve the support provided to victims of child abuse?

Hon JUDITH COLLINS (Minister of Police): Sadly, for too many children in this country, home is not a loving, supportive, or even a safe place. I am very pleased to report on the opening of a new multi-agency centre in Counties-Manukau. The centre has been specifically designed to be victim focused. It will enable police, Child, Youth and Family, and health professionals to work together in one self-contained facility to provide a coordinated service to victims of abuse. An important feature of the centre is that no suspects or offenders will attend the facility. This will help provide a safe and supportive environment for victims. The centre will also investigate sexual assaults against adults, and assess and coordinate the need for intervention with the families of these victims.

Kanwaljit Singh Bakshi: Can she explain the background behind the development of this innovative centre?

Hon JUDITH COLLINS: Yes. The centre is a joint initiative between Counties-Manukau police, Child, Youth and Family, and the Counties Manukau District Health Board. Community groups and local agencies have been working towards the establishment of this centre since 1997 and I would like to commend them for their sustained efforts. More than 12,000 family violence incidents were attended by Counties-Manukau police in the 2008-09 year. This accounts for nearly 40 percent of all calls for service in the district. This new centre represents the commitment of the local community and the Government to cut through the barriers and help repair the broken lives left behind by offenders.

Lynne Pillay: Can the Minister release reports or updated figures on victims of sexual abuse crimes who have been denied Accident Compensation Corporation counselling since November 2009, or ask the Minister for ACC, as he seems unable to do this and I am hearing from hundreds of victims of crime who are asking whether reports like this are being suppressed?

Mr SPEAKER: The Minister can answer insofar as she is responsible for those matters.

Hon JUDITH COLLINS: I am not responsible for accident compensation. I am sure that if that member would like to address the question to the correct Minister who has responsibility, he will be able to answer it.

Lynne Pillay: I raise a point of order, Mr Speaker. The Minister has been asked by written question, and he responded that he is unable—

Mr SPEAKER: We will not enter into that matter. The problem was that the member asked a question of the Minister of Police about matters relating to Accident Compensation Corporation claims, and she has indicated that that is not her responsibility. I do not think it was, and that is where the matter lies. If she indicates that it is not her responsibility, then that is the end of the matter.

Kanwaljit Singh Bakshi: What other steps are being taken to provide better protection for victims of family violence?

Hon JUDITH COLLINS: I am pleased to report that police safety orders will be coming into effect on 1 July. The police will be able to issue orders on the spot to ensure the immediate safety of the victim and any children by removing the alleged violent person from the home for a period of up to 5 days. These orders will be issued in situations where there is insufficient basis to arrest, but where police believe there is a likelihood of family violence occurring. This will provide a period of safety in which victims can consider their future options, including whether to seek a protection order from the courts. These orders will provide another important tool in helping to protect victims, while sending a clear message that family violence will not be tolerated.

Rahui Katene: Is she aware that it is not only the Wairarapa in which there were inaccurate files kept, but also an audit of files in the Bay of Plenty revealed that there were an additional 111 child abuse files that had not been recorded in the police national intelligence application, and what steps is she taking to ensure the shortcomings in the way child abuse cases are being received, prioritised, and investigated is being managed properly across all districts?

Hon JUDITH COLLINS: Yes, there was a very unfortunate situation between 1999 and 2006, when a range of child abuse cases were not properly investigated in the Wairarapa. Following that, police have undertaken a review of all of their districts and there were some cases in the Bay of Plenty, to which the member referred, that also had not been properly dealt with. I am very pleased to say that I have recently visited a Child, Youth and Family and police initiative, which is very similar to what I have just talked about in Counties-Manukau. Child, Youth and Family and police are now working very, very well in the Bay of Plenty to deal with these issues, so I am very pleased to say that.

Accident Compensation—Consultation on Hearing Loss Regulations

6. Hon DAVID PARKER (Labour) to the Minister for ACC: Is he satisfied with the 4-week hearing loss regulations consultation time frame?

Hon Dr NICK SMITH (Minister for ACC): There was a legal requirement for a 28-day consultation period in the accident compensation legislation, but that was repealed by the previous Government, of which the member was a Minister, in 2008. The then Government argued that 28 days or 4 weeks was too long, and that a lesser period should be allowed. The Government has chosen not to take advantage of this law change. The proposals on how to apportion industrial and age-related hearing loss claim costs were released on 24 May and, given the quite narrow issues involved, I am quite satisfied that 4 weeks is sufficient time for organisations and individuals to have a fair say on them.

Hon David Parker: Does the Minister not see that his consultation period, which the media is reporting as being inadequate, could lead to the same sort of shambles and injustices that his changes to counselling for sexual abuse victims have caused?

Hon Dr NICK SMITH: I remind the member opposite that in 2008 his Government repealed the requirement for a 28-day period and argued in this very Parliament that 28 days was excessive. We do not take that view; we are providing for a period of 4 weeks in which people can give proper consideration to, and submissions on, these particular changes.

Hon David Parker: Why does the Minister keep insisting that the current rules for workplace hearing loss cannot be afforded by employers, when it is proven that accident compensation levies

for New Zealand employers are already lower per $100 of earnings than similar levies in Australia, so their levels should not be used to justify cuts to worker entitlements?

Hon Dr NICK SMITH: During the time of the previous Government hearing loss claim costs grew hugely, such that we have a projected liability around hearing loss claim costs of $1.3 billion. I think it is fair to say to employers that they must meet the full cost of hearing loss that is work induced, but I do not think it is fair to say the costs for age-related hearing loss should fall on employers. I do not think that that is a fair approach; that is why the apportionment approach is recommended in these regulations. The only issue in the regulations is whether the apportionment should be an individual percentage or be in bands.

Michael Woodhouse: Given the cost pressures the Minister has described that the Accident Compensation Corporation (ACC) is under over hearing loss claims, does he have any examples of wastage in this area?

Hon Dr NICK SMITH: The cost for hearing claims has increased from about $20 million per year to nearly $80 million per year. An example of the sort of practical waste in this area is over hearing aid batteries. Those used to be sent out automatically, and their cost was simply billed by audiologists to ACC. I have dozens of examples of constituents who have built up batteries galore. This sensible Government has changed the system by providing batteries on request, and that has reduced costs in that one area by more than 45 percent.

Hon David Parker: Does the Minister accept what health professionals like the New Zealand Audiological Society are saying: “Those less able to afford these co-payments, such as older people and those from lower socio-economic groups, would simply not be able to get hearing aids and would simply go without.”?

Hon Dr NICK SMITH: No, I do not. In fact, the bulk of people are receiving hearing aid support for non - work induced—age-related—hearing loss. They are able to receive support through Judith Collins and her ministry for veterans’ affairs, which has grants available; and from the Ministry of Health, which provides support. The key issue here is the principle—and I am not surprised by Labour’s approach—that the cost of age-related hearing loss should somehow be dumped on to employers. I do not think that is fair, and that is why we are making the change.

Catherine Delahunty: Has he sought advice from the Minister for Disability Issues as to whether his proposed changes breach New Zealand’s commitment under the United Nations Convention on the Rights of Persons with Disabilities to promote assistive technologies and make them available at an affordable cost?

Hon Dr NICK SMITH: The key word there is “affordable”. I do not think that an increase from about $20 million a year to $80 million a year is fair on those who pay the accident compensation levies. I note that members opposite have raised concern about the extent to which the accident compensation levies have increased. It is this Government’s view that ACC has a very important responsibility to meet the costs of those persons who have work-induced hearing loss. For those where it is age related, then that is properly dealt with by the other agencies, such as the Ministry of Health, the Ministry of Social Development, and, in the case of veterans, Veterans Affairs.

Catherine Delahunty: I raise a point of order, Mr Speaker. My question asked whether he had sought advice on this matter from the Minister for Disability Issues.

Mr SPEAKER: I think the member’s question did not just ask that; it went on to other matters. I seem to remember it related to UN conventions, etc. The Minister picked up on the latter part of the question and answered it, I believe.

Hon David Parker: I seek leave to table a copy of the letter from the Audiological Society to the Prime Minister, which made the comments that I referred to earlier, and called these cuts “unfair and unscientific”.

Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is no objection. Document, by leave, laid on the Table of the House.

Primary Sector—Reports

7. COLIN KING (National—Kaikōura) to the Minister of Agriculture: What reports has he recently received on the state of New Zealand’s primary sector?

Hon DAVID CARTER (Minister of Agriculture): On Monday the Ministry of Agriculture and Forestry launched its annual flagship publication, Situation and Outlook for New Zealand Agriculture and Forestry, often known as SONZAF. This report looks at issues facing the primary sector, and both current performance and forecast performance over the coming 5 years. The report shows that our primary producers are at the forefront of New Zealand’s export-led recovery and, despite a number of challenges, can look forward to a mainly positive outlook over the next 5 years.

Colin King: What are the key findings of the report and what significant trends does it pick for the sector in coming years?

Hon DAVID CARTER: The report identifies a robust economic outlook for our primary sector on the back of an increasingly strong demand from developing economies, most notably China. Higher prices are predicted across the sector from forestry to dairy, with general conditions for our food exporters expected to be far less turbulent than what we have endured over the last 12 months. This is great news not only for our rural producers and our rural communities but, in fact, for all New Zealanders.

David Shearer: Has he seen the report issued this week from Statistics New Zealand that shows that innovation in the agricultural sector dropped in 2009 and is now 15 percent below that of other business sectors; if so, does he believe that this drop is a result of the long delays to Primary Growth Partnership funding?

Hon DAVID CARTER: I have not seen that report, but I was very pleased to see the member yesterday at the Mystery Creek Fieldays, which is the premier agricultural event of our calendar. In fact, innovation is the major theme of those Fieldays. It is a wonderful event.

David Shearer: I seek leave to table the Statistics New Zealand business operations survey.

Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is no objection. Document, by leave, laid on the Table of the House.

Colin King: How is the Government moving to address the key challenges raised in the Situation and Outlook for New Zealand Agriculture and Forestry 2010 report?

Hon DAVID CARTER: The two key issues raised in the report this year are environmental performance and water storage. Those are two major areas of focus for the Government, and are certainly a priority of mine as Minister. That is why we have developed things like the Global Research Alliance on Agricultural Greenhouse Gases. We are funding a major carbon footprint programme, and we are totally committed to removing the regulatory roadblocks to water storage and getting more reliable irrigation to rural New Zealand.

John Boscawen: Does he agree with the Prime Minister’s statement made to primary producers at Fieldays yesterday when referring to the emissions trading scheme: “I don’t think that New Zealand should be doing more than the rest of the world.”; if so, does that mean agriculture will not have to incur any costs of the emissions trading scheme, including diesel, until farmers in other parts of the world are also included in an emission trading scheme?

Hon DAVID CARTER: I always agree with the Prime Minister. Yesterday I had the opportunity of spending at least 3 hours with him as he wandered around the Mystery Creek Fieldays. He had much opportunity to talk to the farmers of New Zealand. Not one farmer raised the issue of the emissions trading scheme with the Prime Minister during the time I spent with him.

John Boscawen: Does he agree with the Prime Minister, who told protesting farmers at Fieldays yesterday that the emissions trading scheme would cost them 3c per kilogram of milksolids; if so, is that 3c cost from 1 July this year or from 1 January 2015?

Hon DAVID CARTER: I certainly agreed with the Prime Minister when he mentioned the 10 protesters that the ACT Party had assembled, and when he pointed out to those 10 protesting ACT supporters that they had been fed a gross amount of misinformation by the ACT Party.

Social Development and Employment, Minister—Statements

8. Hon NANAIA MAHUTA (Labour—Hauraki-Waikato) to the Minister for Social

Development and Employment: Does she stand by all her statements?

Hon PAULA BENNETT (Minister for Social Development and Employment): Yes.

Hon Nanaia Mahuta: Given her statement “Community Max has been a great success” why has she not extended that programme instead of cutting it—by doing so, she will leave people out of work and no better off because her Government has not created any jobs?

Hon PAULA BENNETT: I certainly do stand by Community Max. It has been a fantastic programme. In fact—[Interruption]—Sorry, does the member Carmel Sepuloni not agree that it has been a fantastic programme? That is all right. Sorry, so it is not a fantastic programme. So Labour members do not like Community Max; Labour members do like Community Max—they cannot quite make up their minds on it. They want us to extend it, but they think that it is not any good. It gets a bit—

Hon Nanaia Mahuta: I seek leave to ask the question again, because she is clearly not answering it.

Hon Member: Mr Speaker.

Mr SPEAKER: No, I do not need assistance on this matter. If the member had not added the last statement in her question it might have been treated a little differently. We have heard enough answer to that question. Does the member have a supplementary question?

Carmel Sepuloni: What target has she set for reducing youth unemployment, particularly for the 37 percent of 15 to 19-year-old Māori boys who are not currently in education or in employment; if no target has been set, how can she possibly stand by her statement: “We want every single one of them to be engaged in education, training, or employment.”?

Hon PAULA BENNETT: I think the member just answered her own question: it is that we would like every single one of them to be engaged in education, training, or employment.

Mr SPEAKER: Before we go any further, I ask the Minister to answer the question again. Because of the interjections going across in front of me I just could not hear that answer. I ask the Minister to start that answer again.

Hon PAULA BENNETT: Certainly, Mr Speaker. What I was saying was that I thought that the member answered the question herself when she said “I would like to see every one of them engaged in education, employment, or training.”

Carmel Sepuloni: I raise a point of order, Mr Speaker. My question asked whether she had set a target with regard to reducing youth unemployment. She did not give me an answer with regard to that. I would like an answer please, Mr Speaker.

Mr SPEAKER: Before we get into an exchange of points of order, I say that if the member had asked just that question we would have got an answer to it. But there was a whole lot more stuff in the member’s question that the Minister picked up on. The remedy lies in the member’s hands. If she had asked just that question I would have done my best to help her get an answer to it. But I cannot insist on the Minister answering a particular part when there is whole lot more in a question.

Hekia Parata: Does she also stand by her statement to a select committee yesterday that “We have invested an extra $285 million in responding to the recession.”?

Hon PAULA BENNETT: Yes, I do. A large proportion of that money went to young people. Of that $285 million, $91 million was spent on young people. That delivered 1,200 job opportunities, more than 3,000 Community Max places, and 2,500 places on the Limited Service Volunteer programme. A figure of $17.4 million went to the Job Support Scheme, helping to save jobs. A figure of $17.5 million was given to ReStart. There was extra employment assistance of $12.6

million. There were summer jobs for students. Of course we set aside $104 million to help nongovernmental organisations ride out the recession.

Hon Nanaia Mahuta: Will the Minister continue to go down the track—

Mr SPEAKER: I apologise to the honourable member. I just ask Government backbenchers on this occasion to be reasonable with interjection levels; I cannot hear the question.

Hon Nanaia Mahuta: Will the Minister continue to go down the track of short-term training schemes like Job Ops, when young people want to work but there are no jobs, or is she developing these sound-good schemes to make her statistics look good?

Hon PAULA BENNETT: To give the House an update on where we are at with job opportunities, I tell members that we have 5,656 young people on Job Ops at the moment. Of the number who have completed their Job Ops at this time, we have seen that 94 percent of them have not gone on a benefit—94 percent of those who finished Job Ops have not gone on a benefit. I think that is fantastic; yes, we will back it.

Jacinda Ardern: If the Minister’s target is that 100 percent of young people are in training, education, or employment, will she concede that she is failing, on her own measure, given that 60,000 young people are not?

Hon PAULA BENNETT: Obviously I am not the Minister of Education. I am also not the Minister for Tertiary Education, who actually plays a part in that. I am a Minister who is part of a team that is directly focused on our young people, and that is making a real difference in their lives, leading to real jobs and real opportunities.

Hon Nanaia Mahuta: I seek leave to table an article showing young people who were on Community Max, but who are now out of work and not able to get a benefit.

Mr SPEAKER: I inquire from the member the source of that document.

Hon Nanaia Mahuta: The New Zealand Herald.

Mr SPEAKER: We will not be doing that.

Work and Income Vouchers—Fraudulent Use by Traders

9. JO GOODHEW (National—Rangitata) to the Minister for Social Development and

Employment: What reports has she received about traders acting fraudulently when presented with Work and Income vouchers?

Hon PAULA BENNETT (Minister for Social Development and Employment): An undercover investigation has confirmed that some second-hand dealers are abusing Work and Income vouchers. Nine second-hand traders were visited in the May sting, and five of those traders illegally offered cash or other goods in exchange for the vouchers. Those traders have received warnings, and have been referred to the police. Following our investigations, one trader has shut down his shop. This trader relied heavily on the profits from this unethical activity.

Jo Goodhew: What is the Government doing to crack down on dodgy second-hand traders?

Hon PAULA BENNETT: We are sending all traders a strong message. We will continue to carry out undercover checks. We will take action against those operating unethically. We will blacklist them and we will inform the police. This unethical behaviour does not only rip off the taxpayer; it also leaves beneficiaries significantly disadvantaged. These vouchers are loans, made as a benefit advance, and at the end of the day they have to be paid back. When an unethical dealer sets an item at a higher price, that cost is ultimately paid by the beneficiary.

Labour, Minister—Effect of Policies on New Zealand Workers

10. DARIEN FENTON (Labour) to the Minister of Labour: Are her policies aspirational for New Zealand workers?

Hon KATE WILKINSON (Minister of Labour): Absolutely. We are a Government that rewards hard work, effort, and success, rather than the previous Government’s relentless focus on mediocrity.

Darien Fenton: If the Minister is aspirational for New Zealand workers, why did her Government not support the development of an International Labour Organization convention to protect the rights of domestic workers?

Hon KATE WILKINSON: The Opposition has been somewhat mischievous. The New Zealand Government supported a recommendation rather than a convention, and that was the right procedural step to take.

Darien Fenton: When the Minister said, as her excuse for not supporting the convention, “the question is whether there is any point in another convention that would only be ignored ...”, was she referring to that convention, which countries that sign up to it must actually implement, or to the UN Declaration on the Rights of Indigenous Peoples, which the Prime Minister has described as aspirational rather than binding?

Hon KATE WILKINSON: In relation to the International Labour Organization convention for domestic workers, I was advised that there are already conventions that cover domestic workers, but they are ignored by the countries that exploit those workers’ labour. Developing another convention that would be ignored serves little purpose.

Darien Fenton: Why did she draft legislation that would enable employers to require workers to work for nothing during their unpaid meal breaks, and that would allow a muffin to replace a meal break or a rest break; is that one of her aspirational policies for New Zealand workers?

Hon KATE WILKINSON: The meal breaks legislation as drafted by the previous Government had provision for unpaid meal breaks. We followed that. The bill that is currently before the select committee makes it less prescriptive and more flexible. But I would expect proper scrutiny of it by the select committee to ensure that workers are not exploited.

Air Quality, National Environmental Standard—Effect of Changes and Delays

11. DAVID CLENDON (Green) to the Minister for the Environment: How many additional people, if any, would die prematurely or be hospitalised if the National Environmental Standard for Air Quality is changed and delayed according to his preferred options?

Hon Dr NICK SMITH (Minister for the Environment): There would be additional premature deaths or hospitalisations from the proposed changes only if it were the case that the standard could actually be met by 2013, but I am advised that it will not be met in 10 airsheds covering 1.6 million New Zealanders. Although the technical advisory group recommended a delay to 2020, my preferred option is 2018, so as to keep maximum pressure on councils to improve air quality at the fastest practical rate, to minimise harm, and to protect the public health.

David Clendon: Can he confirm that if he enforced the standard in 2013 as planned, he could save 482 lives, as noted in the New Zealand Institute of Economic Research report that he has previously cited?

Hon Dr NICK SMITH: No. The member is incorrect for this reason: the only enforcement measure under the standard is to stop any industrial consents. Industrial consents make up only a very small portion of New Zealand’s air pollution problem. The bulk of New Zealand’s air pollution problem is caused by cars in Auckland. In the vast bulk of our centres where air quality is poor, the problem is home fires. That is why this Government has substantially ramped up the amount that we are spending to help convert home fires to cleaner heat technologies, and has made the decision to improve the standards for motor vehicles so that we can reduce pollution from those sources.

David Clendon: Is he concerned that children under 5 years old living in areas with high particulate pollution are more than twice as likely to be hospitalised with a respiratory condition? How many children would need to be at risk for him to uphold the standards in 2013?

Hon Dr NICK SMITH: It is not a matter of upholding the standards; it is a matter of the advice that the standards are not going to be met. What we are—

Keith Locke: You’re rewarding polluters.

Hon Dr NICK SMITH: The member who interjects was in Government for 9 years, during which time little progress was made in improving air quality. I am very proud of the fact that in last year’s Budget we committed tens of millions of dollars to help the practical impact of improving air quality by converting home heaters and by putting regulations in place to make our cars cleaner.

Nicky Wagner: What perverse incentives are there under the existing air quality standards that make them unworkable?

Hon Dr NICK SMITH: The key penalty in the existing standard is that no new industrial consent or renewal of an existing one can be issued if an area is non-complying by 2013. That penalty has very serious implications for 233 businesses that employ more than 17,000 people, because even if those enterprises radically reduced their emissions, they simply would not be allowed to operate. The unfairness is that industry makes up less than 10 percent of New Zealand’s air pollution but is the only one to be punished if it does not meet the standard. It is like having a speed problem on a highway and banning the bicycles. That unfair regulation was symptomatic of the previous Government’s anti-business culture.

David Clendon: What is the Minister’s response to economic analysis from Southern California that finds that even the strictest mandatory air quality regulations do not result in a loss of jobs, but actually increase labour demand, contrary to scaremongering industry claims in that place?

Hon Dr NICK SMITH: If we had some sensible regulations like they may have in California, that would make sense. But the regulation we have at the moment puts a penalty only on industry, when all the research shows that the primary cause of our air pollution problem, particularly in the South Island, is from home heating systems—open fires and old log fires. That is why this Government is putting some serious money into helping change those heaters so that the air will be clearer.

Nicky Wagner: What practical steps has this Government taken that will improve air quality?

Hon Dr NICK SMITH: The Government has spent more in 18 months on improving air quality than the previous Government spent in 9 years. The $340 million package that was announced in last year’s Budget provides practical grants so that people in those air catchments can convert their dirty heating systems—open fires and the like—to cleaner systems. That is exactly the sort of thing we need to do if we are to clean up New Zealand’s air and improve those standards.

David Clendon: What evidence does the Minister have for analysis that supports the claim by self-interested industry players here that regulations would result in the loss of hundreds of jobs?

Hon Dr NICK SMITH: I refer the member to the technical advisory group that prepared the report, which includes both health specialists and air quality specialists, and their recommendations of changes. They concluded that the current regulations are unfair, and any person looking at them would say it is nonsense that the group that produces the least amount of pollution is the only one to be punished in the event that there is non-compliance. I also note that the Government has taken a firmer line in terms of meeting the standards than was recommended by the technical advisory group, for the very reason that we want to make as rapid progress as possible on cleaning up New Zealand’s air.

David Clendon: Does the Minister stand by his claim, as reported in the Sunday Star-Times of 13 December 2009, that the Government intended to strengthen air quality standards, and Solid Energy was mistaken if it believed the review would water down standards?

Hon Dr NICK SMITH: Yes, I stand by that claim. We are setting up some practical rules that will actually work. The Ministry for the Environment advised the previous Government against the particular standard that it adopted, and I think history has proven that the ministry’s advice was robust: the standards that were adopted by the previous Government were not practical. That is why we are responding to the good advice from the technical advisory group. The member is welcome to make a public submission, as are all New Zealanders, to ensure that we get this important environment standard right.

Question No. 2 to Minister

Hon BILL ENGLISH (Minister of Finance): I seek leave to table a document from an occasion I referred to. It is the Auckland Pacific Economic and Social Transformation Agenda.

Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is no objection. Document, by leave, laid on the Table of the House.

Drinking-water Standards—Minister’s Responsibility

12. BRENDON BURNS (Labour—Christchurch Central) to the Minister of Health: What responsibility, if any, does he accept for the continuing exposure of one in six New Zealanders to unsafe drinking-water?

Hon Dr JONATHAN COLEMAN (Associate Minister of Health) on behalf of the Minister

of Health: Under the Health Act, the Local Government Act, and the Building Act, the relevant territorial authority has overall responsibility to ensure that every dwelling house or building has a safe and adequate drinking-water supply. The Minister’s officials in the Ministry of Health administer the Health Act, and the Minister makes sure they take their responsibilities seriously.

Brendon Burns: Can the Minister confirm that more than 9 months ago he froze the $80 million balance of the $130 million Drinking-water Assistance Programme, which was introduced by the previous Labour Government to assist small communities to make their drinking water safe, and why is he in no hurry to help New Zealanders have safer drinking-water?

Hon Dr JONATHAN COLEMAN: In answer to the first part of the question, that fund was frozen because some work needed to be done to make sure that the money went to the communities that needed it, rather than it going to communities on a “first-in, first-served” basis. We are determined that the money will go where it will have the greatest effect. That is why that happened.

Brendon Burns: Is the Minister aware of public warnings in recent weeks from the medical officer of health in Canterbury that a South Island - wide system is needed to alert mothers to the risk of blue baby syndrome because of rising nitrate levels in groundwater, and will this warning prompt him to change from his current Pontius Pilate approach to taking responsibility for safe drinking-water?

Hon Dr JONATHAN COLEMAN: What I can tell that member is that a report recently released by the Office of the Auditor-General on the quality of drinking water across the country looked at eight territorial authorities. The report looked at Canterbury, and it said that the water supply there was actually safe, and that the people of Canterbury are well-served in terms of their drinking water.

Brendon Burns: Is the Minister actually aware that the Auditor-General’s report, in terms of Canterbury, assessed Christchurch only, and that it found that even in Christchurch some of the city’s drinking water is graded D, which is not acceptable?

Hon Dr JONATHAN COLEMAN: What I can tell that member is that the Canterbury water supply is actually safe. The report from the Office of the Auditor-General focused on forecasting ability to provide for the needs of communities into the future. I believe that Canterbury scored pretty well on all counts.

Brendon Burns: If the Minister has confidence that all local authorities are meeting his ministry’s requirements to deliver safe drinking-water, would he drink a glass of water from the bottle I have here, which is from an unsafe supply in the Kaikōura electorate?

Hon Dr JONATHAN COLEMAN: If you would like to have a glass, I would be quite happy to follow you.

Brendon Burns: I raise a point of order, Mr Speaker. I believe that the Minister did not actually answer my question.

Mr SPEAKER: In fairness, the only mistake the Minister made was to say that if the Speaker was prepared to have a drink of the water, he would have one too. I hope he did not actually mean that! I think he meant that if the member was prepared to drink some of the water, then he would too, so he indicated that he would be prepared to drink the water.

Hone Harawira: Tēnā koe, Mr Speaker. What advice is provided to district health boards about the effects of fluoride in drinking water, including the effects on the thyroid, the brain, the joints, and fertility, and how did this information influence the Northland District Health Board in considering fluoridation of the water supply in Kaikohe and Kaitāia?

Hon Dr JONATHAN COLEMAN: Local authorities in New Zealand determine whether to have fluoride in their water, so that is a decision for the local authority up there.

Brendon Burns: Supplementary question to the Minister—[Interruption]—when I have his attention.

Mr SPEAKER: I apologise to the honourable member for interrupting. I ask members at the front on both sides to show a little courtesy to the member asking a supplementary question. It is the last one of the day.

Brendon Burns: How can—[Interruption]

Mr SPEAKER: Have some of those members down the back had a swig out of that bottle? I ask them to show a little courtesy, please—I mean it.

Brendon Burns: How can the Minister continue to assert that the safety of drinking water is the responsibility of local government, when he has instigated a 3-year moratorium on meeting the World Health Organization’s minimum guidelines for drinking-water quality?

Hon Dr JONATHAN COLEMAN: Because it is.

Brendon Burns: I raise a point of order, Mr Speaker. I again ask the Minister to answer the question.

Mr SPEAKER: The member asked how the Minister could assert something, and the Minister answered by saying “Because it is safe.” The quality of the answer might not have been to the member’s satisfaction, but it was an answer to that question, and the public can judge the adequacy of it.

Brendon Burns: I raise a point of order, Mr Speaker. Do I take it from your comments that the Minister has said that drinking water is safe across New Zealand?

Mr SPEAKER: Well, I am not here to interpret the Minister’s answers but I heard the Minister say “Because it is safe”. [Interruption] Does the Minister want to correct his answer?

Hon Dr JONATHAN COLEMAN: Yes. My actual answer was “Because it is.”

Mr SPEAKER: Due to the confusion that has arisen I invite the member to repeat his question.

Brendon Burns: How can the Minister continue to assert that drinking-water safety is the responsibility of local government, when he has instigated a 3-year moratorium on meeting the World Health Organization’s minimum guidelines for drinking-water quality?

Hon Dr JONATHAN COLEMAN: Because it is.

Mr SPEAKER: I heard the answer, and it was indeed a fair answer

ENDS

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