Questions and Answers – July 24

by Desk Editor on Tuesday, July 24, 2012 — 7:37 PM


Economic Programme—Progress

1. MAGGIE BARRY (National—North Shore) to the Minister of Finance: What progress is the Government making in building a more competitive and productive economy?

Hon BILL ENGLISH (Minister of Finance): Good progress. Household saving is positive and expected to increase further. Household debt has fallen from 155 percent of disposable income 3 years ago to 140 percent, although debt levels are still too high. The economy continues to grow moderately. Inflation is at a 12-year low, interest rates are at a 45-year low, and the Government is on track to surplus. The Government is also continuing to focus on the competitiveness of New Zealand businesses, to encourage them to invest and create jobs.

Maggie Barry: What measures has the Government taken since 2008 to build a more competitive economy?

Hon BILL ENGLISH: There are a very large number of measures, but I will mention a few: increasing taxes on consumption and property speculation, and reducing taxes on work and on savings; improving the quality of regulation that affects every business and every organisation in New Zealand; a multibillion-dollar infrastructure programme of investment in rail, roads, ultra-fast broadband, and electricity transmission; as well as consistently increasing investment in science and innovation, and many more.

Maggie Barry: What is the focus of the Government’s business growth programme, and how will it contribute to building a more competitive economy?

Hon BILL ENGLISH: The focus of the Government’s business growth programme is on doing whatever the Government can to encourage businesses to create more jobs, and you can have more jobs only by actually doing things. The Government is going to focus on export markets, on infrastructure, on skilled and safe workplaces, on developing our natural resources responsibly, on growing our capital markets, and on innovation and ideas. So the Government can lend a hand, but in the end a new job occurs when a business actually decides to employ somebody.

Hon David Parker: Are exports down, is immigration to Australia up, and are New Zealand’s net international liabilities projected to grow every year for the next 4 years?

Hon BILL ENGLISH: Exports have been a bit flat, and that is because—

Hon Members: Ha, ha!

Hon BILL ENGLISH: Well, exporters are actually doing their best, and they need all the help they can get from a Government that is actually in favour of exporting and investing, rather than Opposition policies intended to stop people from creating jobs, businesses, and exports.

Maggie Barry: What are some of the issues affecting New Zealand’s productivity and competitiveness?

Hon BILL ENGLISH: There is any number to pick from, but one that is important is housing affordability. The Government has a strong interest in making housing more affordable, because a lot of taxpayer support goes to housing, but we are particularly concerned that there is almost no new building of houses for people with lower-quartile incomes—that is, incomes in the bottom 25 percent. That is very unfair to New Zealanders who aspire to homeownership, and we believe that by working with local bodies we can increase the supply of housing and reduce the excessive burden of the cost of housing on New Zealand families.

State-owned Assets, Sales—Loyalty Bonus Scheme for Shares

2. DAVID SHEARER (Leader of the Opposition) to the Prime Minister: Does he stand by his statement that $360 million is “a possible number” for the cost of the loyalty scheme for asset sales?

Rt Hon JOHN KEY (Prime Minister): I stand by my full statement, which was: “I don’t know the details because they’re not agreed yet, and what the loyalty bonus might look like, but yeah, that’s a possible number. I haven’t seen their workings, so I wouldn’t want to agree with that at this point.” Now having had a chance to look at it, I understand the $360 million number came from Russel Norman and that there were gross errors in the way it was calculated. Officials are working through the details of the loyalty bonus with Mighty River Power, but even if there was a loyalty bonus across the entire programme, the costs would not be anywhere near $360 million, let alone the $500 million reported in the New Zealand Herald today.

David Shearer: Given that yesterday he talked about a figure of less than half of $1.3 billion, he thought that $360 million was “a possible number”, and today he is indicating $60 million to $80 million, what is the actual figure, and will it change tomorrow?

Rt Hon JOHN KEY: The final number at this stage is not known. The final number is not known. I did not agree with the $360 million yesterday; I said that it is—

Grant Robertson: You said it was possible.

Rt Hon JOHN KEY: —possible, depending on how it was calculated and by whom. Frankly, what we are seeing in this debate is that Labour and the Greens just make up all sorts of numbers. According to Labour, selling shares to New Zealanders is a Ponzi scheme. Well, I do not know, but there are certain things that are a Ponzi scheme, but selling shares to New Zealanders is not one of them.

David Shearer: Did the Prime Minister announce the loyalty scheme to the National Party conference on Sunday without actually being aware of the cost of it?

Rt Hon JOHN KEY: What I indicated to New Zealanders on Sunday is that there are a number of elements of the mixed-ownership model that we were able to get out there and confirm. One is that the minimal parcel would be $1,000. The second thing is that there would be an unscaled amount of $2,000 for direct investment, and that there would be a loyalty bonus that applied. And had I known that there were going to be only 79 protestors outside, I would have gone and had a chat to them as well. I was expecting tens of thousands, the way the Greens and Labour were talking about it.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. That was a straight, direct question about whether the Prime Minister’s announcement was costed.

Mr SPEAKER: Well, if that was the question, it is a shame that that was not what was asked. If the member had asked “Was the Prime Minister’s statement costed?”, that would have been an interesting question, but that is not what the question—

Hon Trevor Mallard: Was he aware of the costing?

Mr SPEAKER: Order! The question was not as the member indicated. Also, if questions are to be taken seriously, the level of interjection has to come down, because the Minister—the Prime Minister in this case—is able to latch on to interjections and respond. If questions are to be serious, then the House has to listen to the answer.

David Shearer: Did he announce the loyalty scheme to the National Party conference without being aware of the cost?

Rt Hon JOHN KEY: I announced the intention to have a loyalty scheme. I do not know the exact cost at this point, but what I do know is that there may be no cost. I was taking this morning to listen to Morning Report. On Morning Report this morning, if I can quote from a stockbroker heavily involved in the Queensland Rail float, which had the loyalty bonus, he said that the amount the Government receives for its 49 percent may actually increase, and that the incentive increase for the float from locals and paid by itself is driving up the price institutions may pay—

Mr SPEAKER: Order! I think, given the question asked, the Prime Minister has given a sufficient answer.

David Shearer: What proportion of shares will have to be set aside for the loyalty bonus, the settlements with iwi, to pay brokerage fees, advertising, and public relations fees?

Rt Hon JOHN KEY: In terms of the first point, it will be the amount of the calculation done by those New Zealanders who buy direct shares up to their $2,000 limit applied by the loyalty number yet to be set. That will be calculable. In terms of the others, what the Government is doing is releasing capital under the mixed-ownership model to buy other assets. We have never argued that we are getting the absolute maximum price. If we wanted to do that, we would have followed Labour’s model of flogging the lot off to foreigners.

Te Ururoa Flavell: Tēnā koe mō tō karakia i tēnei rā. Does the Prime Minister believe it to be fair, just, and moral to be giving away hundreds of millions of dollars to investors for asset sales, when the redress for Māori for 135 or so years of Treaty breaches is capped at $1 billion, and how can he justify this?

Rt Hon JOHN KEY: Firstly, we would reject the first proposition of giving anything away. As I said, if you look at some of the financial advisers this morning, the argument is, in fact, actually that the Government’s return could increase, not decrease. Secondly, I utterly strongly, strongly reject the notion that the Treaty breaches will be capped at $1 billion. That is a 1995 number. As the member knows, there is the relativity clause and others, and I would0 strongly suggests that the number at the end will be considerably greater than that.

David Shearer: Will the money to pay for the share loyalty scheme be coming from debt or from reduced funding available to schools and hospitals?

Rt Hon JOHN KEY: The net proceeds from the mixed-ownership model will be used to buy other assets for the development of New Zealand. So under a National Government $1 billion will be put into 21st century schools, and under Labour nothing will be put in. Under National $1 billion will be put into 21st century schools without debt. Under Labour—

Mr SPEAKER: Order! The answer is interesting, but I am not sure it is actually an answer to the question asked. The question asked whether the cost of the scheme would be picked up through extra debt, or reduction in spending on health and education, from memory; whereas the Prime Minister’s answer talked about what the Government planned to spend money on. So I bring the Prime Minister back to the question asked, and ask him whether he could focus on that.

Rt Hon JOHN KEY: There is a net proceeds number, and those net proceeds will go into schools.

State-owned Assets, Sales—Loyalty Bonus Scheme for Shares

3. BARBARA STEWART (NZ First) to the Minister for State Owned Enterprises: How many “mum and dad investors” does he believe will benefit from the loyalty bonus shares under the Mixed Ownership Model?

Hon TONY RYALL (Minister for State Owned Enterprises): Securities legislation prevents me from commenting directly on the expected level of demand for shares. However, in answer to the member, all everyday New Zealand investors who meet the conditions of the loyalty scheme will get the appropriate loyalty shares. The Government is very confident that all 4.5 million New

Zealanders will benefit from a successful float, because this will help control New Zealand’s debt as the world debt crisis deepens, and allow us to invest in building schools, roads, and hospitals, without having to borrow from foreign banks.

Barbara Stewart: Is he aware that the result of the Queensland Rail share float meant that of the 80,000 local mum and dad investors, 50,000 sold their shares in the company before the loyalty share bonus eventuated; if so, how does he believe that the proposed share floats in New Zealand will be any different?

Hon TONY RYALL: I would have to check those figures before I am able to confirm them. What I can tell you is that the share floats in New Zealand—the share floats that the Government is planning—are different in the sense that this Government is maintaining 51 percent New Zealand control of those companies as a minimum, with a cap of 10 percent on any other shareholder. That is legislated in the law.

Hon Clayton Cosgrove: Given that the Prime Minister has said, and this is a direct quote: “We could say one hundred percent of shares to New Zealanders, obviously we could say less, but we are targeting that eighty five to ninety percent and I’m confident we’ll reach it.”, is the announcement of a loyalty bonus share scheme not an admission of defeat, that these shares will not be held by Kiwis in the long term, and that they will eventually be sold predominantly to foreign interests, in the same way that Contact Energy shares were predominantly sold to foreign interests?

Hon TONY RYALL: No, because the Government is determined that there will be a successful float, because that is in the interests of all New Zealanders. I have to tell the member that the use of loyalty shares is not unusual. When a Government across the Tasman sold Qantas shares, they had bonus shares of one for every 25 held to a cap of 800 bonus shares. Telstra 3 saw a bonus share of one for every 25 held, to a cap of 8,000 shares for the general public. And in Queensland Rail, it was one bonus share for every 20 shares for Australians, and one for every 15 shares for Queenslanders. I think this is quite a mainstream approach, part of keeping everyday New Zealanders at the front of the queue, and I would like to thank the Opposition for the great publicity it is giving the Government’s loyalty share proposition.

Barbara Stewart: Has he received any advice or reports indicating that mums and dads account for more than 7 percent of the population; if so, how does he reconcile this with the fact that based on Treasury forecasts, only 7 percent of New Zealanders will purchase shares in mixed-ownership model programmes?

Hon TONY RYALL: The Government has made it clear that this is a programme that seeks to engage support from everyday New Zealanders, and, of course, those who are able to participate will. That is why we have got the low entry-level minimum figure of $1,000. Many everyday New Zealanders are saving in KiwiSaver, and certainly in the superannuation fund, and they will get the opportunity to participate in these floats. And, of course, other everyday New Zealanders will benefit from the proceeds, which will be reinvested into schools, roads, and hospitals without increasing our foreign debt. As the member will know, debt markets have become more uncertain, with the announcement this morning that Moody’s has put the German economy on negative watch, and that is part of why we need to control our debt here in New Zealand.

State Housing, Auckland—Tāmaki Transformation Programme

4. SIMON O’CONNOR (National—Tāmaki) to the Minister of Housing: What recent announcement has he made about the Tāmaki Transformation Programme?

Hon PHIL HEATLEY (Minister of Housing): This morning I had the pleasure of joining Mayor Len Brown to announce the creation of the Tāmaki Redevelopment Company, which is New Zealand’s very first urban redevelopment company. The company will be jointly owned by the Government and the Auckland Council, and has been created to take the lead in transforming the area over the next 15 to 25 years. Initiatives will include strengthening the local economy, optimising land use and existing housing stock, and creating safe and connected neighbourhoods. I

would like to acknowledge, and take the opportunity to thank, the mayor, his council, and the Tāmaki community.

Simon O’Connor: What role will the community have with the company and the programme moving forward?

Hon PHIL HEATLEY: The people of Tāmaki have told us that they are keen to see the Tāmaki Transformation Programme vision progressed as quickly as possible. After examining a range of options, the Government and council agree that the new company is the best vehicle to make this happen. It will be tasked with engaging and working closely with the community, as it is critical to the success of the work. A comprehensive appointment process for a full board of directors is now under way, and the Government and council will be seeking to appoint experienced directors, some with links back to the Tāmaki community, which is very, very important because we need their voice.

State-owned Assets, Sales—Loyalty Bonus Scheme for Shares

5. Dr RUSSEL NORMAN (Co-Leader—Green) to the Prime Minister: Does he stand by his statement in relation to the share give-away as part of his asset sales programme that “If the member wants to go to the Budget, he will see quite clearly laid out the Government’s programme, the anticipated return that the Crown will get, and the costs likely to be associated”?

Rt Hon JOHN KEY (Prime Minister): The words before the quote are “the members”, but I stand by my statement, which I made on 20 June. The Budget does set out the returns and costs from the mixed-ownership programme. Ministers have since made the decision in principle to offer a loyalty bonus. We are taking advice on how to treat this in the Government’s books—for example, whether we need to make a separate appropriation for it.

Dr Russel Norman: So is the Prime Minister confirming that in his answer to that question, when he referred to the costs likely to be associated with the asset sale programme, he was not accounting for the cost of the share give-away?

Rt Hon JOHN KEY: Firstly, I would reject the term “give-away”. In terms of the loyalty bonus, Treasury is working out exactly where that might be accounted. Overall, what it has said is that, for the total costs, the best estimates are about 2 percent of the proceeds, but that includes a lot of other factors. It will come back to us with advice on how it should be appropriated.

Dr Russel Norman: Given that the Government has previously said the cost of the asset sale programme would be about 2 percent of proceeds, or about $120 million, is he now saying that the cost of the share give-away, or the bonus scheme, will be a further 2 percent, or $120 million, on top of that?

Rt Hon JOHN KEY: No, I am not.

Dr Russel Norman: Does the Prime Minister understand that under our constitutional system Governments have to ask the permission of Parliament to spend money, and that Parliament has the right to expect that the full costs of the asset sale programme, including the share give-away, would have to be included in the Budget, or another appropriation, or a piece of legislation before this House?

Rt Hon JOHN KEY: The member is making some assumptions that may be incorrect.

Dr Russel Norman: Which assumptions are incorrect?

Rt Hon JOHN KEY: The way that the loyalty scheme will be paid for. At the moment we are taking advice on that, but there are a number of ways that it may be paid for.

Dr Russel Norman: Given that in his earlier answers to David Shearer he said that the way he planned to pay for the loyalty scheme was to hold some shares back from the asset sale programme then use them for the loyalty scheme, why would he not need parliamentary approval to give away those further shares, given that giving away shares is the same as spending money, and the Government needs parliamentary approval to spend money?

Rt Hon JOHN KEY: The member is making some assumptions that may not be correct, like so many things he has said about the mixed-ownership model. But I can assure the member that the Government will follow the law. We always do on this side of the House.

Mr SPEAKER: Dr Russel Norman.

Dr Russel Norman: Supplementary—

Hon Trevor Mallard: Tell John Banks that! Tell John Banks that!

Dr Russel Norman: Yeah, tell that to “Banksie”!

Mr SPEAKER: Order! [Interruption] Order! Goodness me! Dr Russel Norman.

Dr Russel Norman: In light of his comment on the weekend that “we don’t favour one group over another.”, why is his Government planning to make the 95 percent of New Zealanders who will not buy shares in these companies subsidise the 5 percent who might?

Rt Hon JOHN KEY: Again, that is where the member is just talking rubbish, and has been the whole way through. For a start-off, there are 1.8 million KiwiSaver accounts around New Zealand. My guess is that a great many of those will probably participate. Secondly, the New Zealand Superannuation Fund is likely to be a buyer, along with ACC. They may well buy in these shares. But, most important, the proceeds from the mixed-ownership model will be used to buy other assets for the benefit of New Zealand. When we go and build a billion dollars’ worth of 21st century schools, that member will want to be associated with that, I am sure.

Environment—Funding of Mackenzie Sustainable Futures Trust

6. GRANT ROBERTSON (Deputy Leader—Labour) to the Prime Minister: Does he stand by his statement in relation to the funding of the Mackenzie Sustainable Futures Trust, “I’m sure someone will have a cursory look at it”; if so, has he or his office investigated the funding?

Rt Hon JOHN KEY (Prime Minister): As I said yesterday, my office and the Minister for the Environment’s office had a quick look at the matters involved. We did not find anything that raised concerns to us.

Grant Robertson: As part of the investigation by his office, did they ask the Deputy Secretary for the Environment to explain her comment about the trust: “We remain deeply concerned at the level of professional fees being paid into this process; some of the costs charged also have us concerned.”; if not, why not?

Rt Hon JOHN KEY: I am not sure if that question was directly asked. I think it is important to understand what happened in this process. I will tell you what happened in this process: a few hundred thousand dollars were paid to a trust so that the collaborative process could be used to sort out the problem. Actually, the estimated cost for the Environmental Protection Authority to have dealt with it would have been $2.6 million. By the way, Labour funded a $2.2 million contract with exactly the same organisation, Ecologic Foundation, for exactly this—environmental dispute resolution through MORS—and if you did not use it for that instance, what would you? By the way, $2.2 million trumps $200,000.

Grant Robertson: Can the Prime Minister confirm that the $2.2 million contract he has just referred to went through a full, open tender process, unlike the money paid out to this trust?

Rt Hon JOHN KEY: No, I cannot confirm that. What I can confirm is this. This is a comment from Peter Wilson, the vice-president of Federated Mountain Clubs in relation to this issue—

Mr SPEAKER: Order! The question simply asked if the Prime Minister could confirm something, and he said that he could not. Really, that should be the end of the answer.

Grant Robertson: As part of his office’s investigation, did they review the decision by the independent panel of the Community Environment Fund to turn down funding for this trust on the basis of “high costs” and having “no clear strategy, and no clear process”, and did this cause him to question the decision of the then Minister for the Environment to directly fund the trust from ministry baseline funding, knowing that?

Rt Hon JOHN KEY: No, and I would reject that assertion. If one goes and actually looks at what has taken place, and one goes and looks at Peter Wilson, the vice-president of Federated Mountain Clubs, he said: “I personally attended every single Mackenzie Forum meeting over a year and a half on behalf of my organisation … and I must say that the price of Guy Salmon’s … involvement … would have been cheap at twice the price.” And by the way, it was about one-tenth of the cost of going through a court process. That is why the collaborative process works. I know lots of people who support the collaborative process, because when it was set up for the law, Grant Robertson said: “The success of the Land and Water Forum has been that it has used a collaborative process that sees all players at the table … This will be a big challenge for local and central government, but offers the prospect of a whole new way of policy making that will be inclusive and durable.” What wise words from Mr Robertson!

Grant Robertson: As part of his office’s investigation, did they read the statement about the trust made by a Ministry for the Environment official “Now they are looking to get more cash from the Community Environment Fund and pressure us into a quick decision.” in relation to a trust chaired by Jacqui Dean, and does Government officials being pressured by a trust chaired by a National backbench MP give him any concern at all?

Rt Hon JOHN KEY: I think when it comes to pressuring officials to spend money unwisely, that member should go back and look at the whole history of the pledge card. But anyway, going back to that for a moment, the view of the Minister and many of those involved was quite clear: a collaborative approach was a much better way of going, because it cost one-tenth of what going through a court process would have cost.

Michael Woodhouse: Has he seen any other reports in relation to the work of the Mackenzie Sustainable Futures Trust?

Rt Hon JOHN KEY: Yes, I have seen a report from Peter Wilson, vice-president, when he said this morning—

Grant Robertson: You’ve already done that one.

Rt Hon JOHN KEY: No, this is something different. You should enjoy the whole transcript. He said “This is utter tripe, and a good example of why someone should check their facts before spinning stories. I’m disappointed that Grant Robertson took to grandstanding before factchecking,”.

Grant Robertson: Does the Prime Minister think—[Interruption]

Mr SPEAKER: Order! I apologise to the honourable member. He has got a good voice, but the level of noise was too high.

Grant Robertson: Does the Prime Minister think that a trust launched at a National Party Bluegreens conference, chaired by a National MP, and directly funded by one of his Ministers after it was rejected by an independent panel meets the standards of transparency and accountability for spending taxpayer money?

Rt Hon JOHN KEY: Yes, and I think the member should check his facts. Let us understand what has taken place. In Otago there has been a substantial environmental issue about cubicle farming. There has been widespread community interest—as I understand it, 5,000 submissions. This was a process that collaboratively got all members of the community round the table at one time, and did that for one-tenth of the cost of going through the courts. That is a lot cheaper and a better way of going than through a court process.

Hon Dr Nick Smith: Would he advise local MP Jacqui Dean that instead of working with her local mayors on the Mackenzie Sustainable Futures Trust, she should have introduced a bill to Parliament overruling the Resource Management Act and local councils to allow a friendly developer to pick up millions in windfall gains, and then pick up a $17,000 political donation for her services—an approach endorsed by Grant Robertson in the style of Clayton Cosgrove?

Rt Hon JOHN KEY: No, that is not my advice.

Grant Robertson: I seek leave of the House to table several documents. The first of those is an email from the Deputy Secretary for the Environment to a staff member at Environment Canterbury saying “We remain deeply concerned at the level of professional fees being paid into this process; some of the costs charged also have us concerned.” This email was released under the Official Information Act.

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.

Grant Robertson: I seek leave to table an email from the Deputy Secretary for the Environment to another official at the Ministry for the Environment outlining the reasons why the Mackenzie Sustainable Futures Trust was not funded under the Community Environment Fund, including its high costs and that it had no clear strategy and no clear process.

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.

Grant Robertson: I seek leave of the House to table an email from a Ministry for the Environment official to other Ministry for the Environment officials saying about the trust “Now they are looking to get more cash from the Community Environment Fund and pressure us into a quick decision.”

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.

District Health Board—2012 Community Pharmacy Services Agreement

7. Dr PAUL HUTCHISON (National—Hunua) to the Minister of Health: How many of New Zealand’s 947 pharmacies have signed up to the new Community Pharmacy Service agreement, and what does this mean for their patients?

Hon TONY RYALL (Minister of Health): I am advised all 947 pharmacies have accepted. Under the past agreement pharmacies were funded based on the number of medicines they dispensed, so dispensing medicines was it. Under the new agreement we are rewarding our skilled pharmacists for providing support and advice to patients. In particular, around 200,000 people with long-term conditions will get support to better manage their health with the support of their pharmacist. They are a highly valued part of our health workforce and the new approach means we will be able to make much greater use of their expertise, and patients are the real winners from this big step forward in primary care for patients.

Dr Paul Hutchison: Te Minita o Health. What other reports has he seen on this new patientfocused approach where pharmacists will better manage their patients?

Hon TONY RYALL: Although I am advised all 947 pharmacies have accepted the new approach and it is supported by the Pharmacy Guild, I saw a lone statement that the pharmacy sector was in “chaos” and that the new contracts are “ill-conceived”, and, not only that, they were— get this one—“dangerous”. Who would say this? Of course it was the New Zealand Labour Party, scaremongering again. This agreement marks a significant step forward in the delivery of pharmacy services for patients and pharmacists, and demonstrates this Government’s commitment in health to “Better, sooner, more convenient care” for New Zealanders.

Hon Maryan Street: To the Minister o Health. Does he intend simply to ignore the pharmacists who say that they have signed “under duress”, that the new agreement was “problematic for rural pharmacies because of the change in funding model”, and—quoting pharmacists—that “Patient

safety could be at risk … because pharmacists are being forced to focus on revenue-gathering,”; if he is not going to ignore their concerns, what does he intend to do about them?

Hon TONY RYALL: All issues have been considered as part of drawing up this agreement. What that member needs to realise is that although she spent several days in this House standing up trying to make all sorts of claims about this scheme, all 947 pharmacies have agreed. We are on track to a much better pharmacy service than that member’s failed crowd ever offered New Zealanders.

Barbara Stewart: Is the Minister aware of the many pharmacists who believe that the long-term condition eligibility will not include the patients who need it most; if so, what is he doing to ensure the patients receive—

Mr SPEAKER: Order! I apologise to the member. I say particularly to the Labour front bench that the noise level is totally unfair. Barbara Stewart deserves the courtesy of being able to ask her question in a reasonable House. I accept that it is not the very front bench on the Labour side that is the cause of the problem; it is perhaps a little further back. But I would just ask—

Hon Trevor Mallard: What about on your right, Mr Speaker?

Mr SPEAKER: Order! I have been, if anything, a little harder on the team on the right today. The noise on my left has been a little excessive and I do want to hear Barbara Stewart’s question. Barbara Stewart, please start again.

Barbara Stewart: Thank you, Mr Speaker. Is the Minister aware of the many pharmacists who believe that the long-term eligibility criteria will not include the patients who need it most; if so, what is he doing to ensure the patients receive the funding for the care they need?

Hon TONY RYALL: I am aware that one or two have expressed that sort of concern, but we have got the Pharmacy Guild working so closely with the New Zealand health service in delivering that, that we know we are going to achieve something positive. I think the lesson to the member opposite is that although she might have had correspondence from one or two disaffected people, the vast majority of pharmacies believe the changes that are being made are appropriate. The member should actually get in behind the changes that are going to be so positive for patients in New Zealand.

New Zealand – Australia Migration—Minister’s Statements

8. Hon DAVID PARKER (Labour) to the Minister of Finance: Does he stand by his statement in relation to New Zealanders leaving for Australia, “What’s the point of standing in the airport crying about it?” given that 158,167 have left since November 2008, 53,763 left in the last year, and 4,361 left in June?

Hon BILL ENGLISH (Minister of Finance): Yes, I stand by my full statement, which included the additional comment “We’ve just got to compete.” I think that is pretty obvious. If our younger people want to go to Australia to higher-paying jobs, at the very least in New Zealand will need to create some new jobs, in particular in the minerals and resources sector, which that member’s party is quite opposed to.

Hon David Parker: Then does he stand by his statement on Agenda on TV in November 2008, when he was asked “And What about this idea of people leaving to Australia … have you got a goal to reduce that?”, and he replied “Well we certainly do want to reduce it”, and “that was a demonstration I think of the kind of political leadership you’ll see from John Key which is aspirational and taking a run at winning the competition between us and Australia for talent.”; if so, has he achieved that goal?

Hon BILL ENGLISH: Yes, I certainly do stand by those statements; and judging by the opinions given in Australia when the Prime Minister visited there a few weeks ago, they would prefer to have him running Australia, as well.

Hon David Parker: Has he received any reports of any member of Parliament telling the Minister of Finance in this House that the reason for New Zealanders leaving for Australia is, and

again I quote, “because of a self-absorbed … Government that cannot manage any political issues and does not care about the future of the country”; if so, can he confirm that this is the current reason people are leaving in the view of the person who made that very statement, the Hon Bill English?

Hon BILL ENGLISH: I do stand by that statement, certainly. What New Zealand is doing is actively compete for the talents of its younger people by helping businesses to create new jobs that can pay more. In the absence of new jobs that can pay more, more of them will leave. I think it is important we get on and support those businesses, whereas Labour and the Greens believe it is important to try to stop anything happening in New Zealand, which will guarantee our young people have to leave.

Hon David Parker: Does he agree with Massey University professor Paul Spoonley’s observation that the number of young New Zealanders now heading for Australia are so high that it is making New Zealand’s ageing population problem worse?

Hon BILL ENGLISH: No, I do not agree with that statement. We are getting on with the one thing that will make a difference to those young New Zealanders, and that is creating new and better opportunities here in New Zealand. One of the major obstacles to that is the attitude of Labour and the Greens, who believe that any kind of enhanced or profitable business activity is somehow wrong and that we should rely on the Government to do all this.

Andrew Williams: Will the 1,000-plus New Zealanders leaving each week to live in Australia be entitled to keep their purchased $2,000 State-owned enterprise share parcels, and will they still receive the loyalty bonus shares after 3 years?

Hon BILL ENGLISH: If they meet the definitions, of course they will.

Oil and Gas Exploration—Seabed Depth of Tendered Permit Areas

9. GARETH HUGHES (Green) to the Minister of Energy and Resources: What depth is the seabed in the areas covered by tendered petroleum exploration permits 12PEG2 off the coast of Wellington and 12GS2 off the coast of Otago and how does this compare to the depth of the deepest producing well in New Zealand?

Hon PHIL HEATLEY (Minister of Energy and Resources): The deepest well ever drilled in New Zealand was the Wakanui-1, at 1,467 metres. The deepest currently producing well is the Tūī at 125 metres. 12PEG2 covers depths ranging from 1,000 to 2,750 metres, and 12GS2 depths ranging from 1,250 to 2,250 metres. I would like to note that the exploration permits for 12GS2, which we have just released, were also tendered by the previous Government, which was supported by that member’s party. We thank Labour and the Green Party for their foresight.

Gareth Hughes: So, pretty deep, eh. How will New Zealand’s identified 5,500-tonne oil spill response capability be sufficient to deal with a leak from an exploratory deep-sea well at these depths, given that the 1,500-metre Deepwater Horizon exploratory well in the Gulf of Mexico leaked more than 600,000 tonnes?

Hon PHIL HEATLEY: Because, first of all, at the front end the goal of the exploration companies, of this Government, of the Environmental Protection Authority, and of all consenting bodies, including the Ministry of Economic Development, is to make sure that does not happen. If it does happen, Maritime New Zealand has equipment onshore in New Zealand and on call internationally, including in Australia, to make sure that a response can be undertaken. Those are the assurances we are given by those bodies.

Gareth Hughes: Given that the Gulf of Mexico disaster was stopped only when a second rig drilled a relief well, and it can take 4 to 6 weeks at best—at best—for a relief rig to arrive in New Zealand, will the Minister require a second rig to be on standby during deep-sea drilling operations?

Hon PHIL HEATLEY: No. The exploration companies, which are experts in this field, are best placed to put a response plan in position. It will be run over by experts within various Government

departments. I do not think it is wise to take the Green Party’s advice on how you would respond to an incident like that. I would prefer to hear from the experts.

Gareth Hughes: Given the Government does not have the resources to deal with an oil spill, and the economic impact would be catastrophic, will he listen to the more than 140,000 New Zealanders who signed Greenpeace’s petition calling on him to prohibit deep-sea oil drilling, and the experts around the world who are saying a second relief rig is the only way to stop a deep-sea blowout?

Hon PHIL HEATLEY: I disagree with what the member is implying.

Gareth Hughes: I seek leave to table the Greenpeace technical report Out of our depth: Deepsea oil exploration in New Zealand.

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

Transport Funding—Auckland Council Proposal

10. PHIL TWYFORD (Labour—Te Atatū) to the Minister of Transport: Does he stand by his statement that it is “ridiculous” for Auckland Council to try and go ahead with plans to charge motorists to use the city’s roads?

Hon GERRY BROWNLEE (Minister of Transport): Yes, because the Crown owns the State highway network, which carries 35 percent of the vehicle kilometres travelled in Auckland. I note also that last week the member said it would be an unfair imposition on ordinary working Aucklanders.

Phil Twyford: Why did he rule out even considering Auckland’s ideas to making up his Government’s shortfall in transport funding when the Government’s own response to the plan in February this year said: “The Auckland Council faces similar fiscal constraints to the Government, and so it would also make sense for the Council to consider new … approaches to funding … the infrastructure … required to deliver Auckland spatial plan objectives.”?

Hon GERRY BROWNLEE: The member should not assume that his own knowledge of these things puts the limits around my thinking about the way in which the Auckland Council might look to fund these things. What I would note, though, is that the member himself has previously said that such charges would be an imposition on ordinary working New Zealanders. He also just a week or so ago suggested that the increases for motorists when it came to road-user charges were inappropriate. I think what the Labour Party members need to do is say what they will do rather than what they will not do.

Phil Twyford: Why did he rule out even listening to Auckland’s alternative funding options for funding infrastructure like the additional harbour crossing over the Waitematā, when the Government’s own transport agency says that it will be one of this country’s most expensive infrastructure projects, and this means that a range of options beyond the National Land Transport Fund should be considered?

Hon GERRY BROWNLEE: I think that far from ruling anything out, I have simply made it clear that the idea that Auckland Council would impose charges without consideration of Government was not appropriate—ridiculous, in fact. I want to report to the House that we had a very good meeting last week with the Auckland Council. A number of Ministers attended, transport was obviously on the agenda, and we do have agreement to continue dialogue on how Auckland’s long-term problems might be solved with some better roading projects.

Phil Twyford: Is it not arrogant to be ruling options in or out when it was his Government that abolished the regional fuel tax, which would have funded much of Auckland’s transport plans, when it forced Auckland Council to borrow half a billion dollars to pay for the electric trains, when it went cap in hand to Auckland Council asking for bridging finance, because the Government’s own funding for Auckland’s roads ran out, all the while refusing to support the popular and essential city rail link?

Hon GERRY BROWNLEE: I take big issue with the suggestion that the city rail link is useful or popular.

Health and Safety, Workplace—Progress

11. CHRIS AUCHINVOLE (National) to the Minister of Labour: What recent progress has been made towards improving safety in the workplace?

Hon KATE WILKINSON (Minister of Labour): I am pleased to report that the newly appointed health and safety task force recently met for the first time. The independent task force is reviewing the wider health and safety system to come up with innovative ideas and fresh thinking to help achieve a 25 percent reduction in serious workplace injuries by 2020. We are also supporting this target with an extra $37 million in investment in health and safety over the next 4 years. Having attended this inaugural meeting, I am happy to report an air of real excitement at this great opportunity to make a real and much-needed difference to the well-being of New Zealand workers.

Chris Auchinvole: What are the next steps for the health and safety task force?

Hon KATE WILKINSON: It is important that the task force is given the time it needs to do its job. My expectation is to see a discussion document released by the task force later this year to kick off a public consultation process. This will, of course, give due consideration to the royal commission report into Pike River, which is due to be released in September. The task force is then likely to deliver a final package of recommendations to the Government early in the new year. I have often said that the safety of New Zealand workers should not be a political issue, and I can confirm to the House that when this package is reported back, I plan to consult with all parties, and I welcome feedback before final policy decisions are made, and, indeed, at any time before the package is reported back.

Housing Quality and Availability—Effect on Health of Christchurch Residents

12. Hon ANNETTE KING (Labour—Rongotai) to the Minister of Housing: Does he agree, with Canterbury District Health Board medical officer, Alistair Humphrey, that cold, damp and overcrowded housing in Christchurch has “contributed to general sickness”; if not, why not?

Hon PHIL HEATLEY (Minister of Housing): Yes. It is widely recognised that there is an association between poor-quality housing or overcrowded living conditions and a greater risk of some infectious diseases, not just in Christchurch but anywhere. That is why the Government has seen over 160,000 houses insulated to date, and also why the Housing New Zealand Corporation will have insulated every State house where practicable by the end of next year, as well as having commenced a significant reconfiguration of the State housing stock portfolio to make sure we have got the right-sized houses in the right conditions in the right places in New Zealand.

Hon Annette King: Does he stand by his statement that there is no housing crisis in Christchurch; if so, would he change his mind if he read the recent report from the Canterbury District Health Board, which said the shortage of rental houses has worsened in recent months, and people with mental illness, physical disabilities, and terminal illnesses are struggling to find accommodation, and it is now a major issue?

Hon PHIL HEATLEY: Well, the member might like to drum up the idea that there is a crisis. The reality is that there are housing challenges in Christchurch. That is why there is a rebuilding programme, that is why the Housing New Zealand Corporation is upgrading its State housing stock, and that is why the Housing New Zealand Corporation is looking at redevelopments in order to build another 250-350 houses in Canterbury. We need to address these challenges. We recognise that they are there, and we are doing the work that is necessary.

Hon Annette King: Has he seen the report last week from KidsCan, a welfare organisation funded by the Government, which states that people in Christchurch are living in one room in damp and mouldy houses, which is ideal for the spread of disease, and that children are now suffering

from poverty-related illness; and should not such a report make him rethink his statement that there is no housing crisis in Christchurch?

Hon PHIL HEATLEY: I have seen a number of reports, and probably the most significant one was when I first came into Government and discovered that many thousands of State house tenants in Christchurch and elsewhere were living in cold and mouldy houses. That is not restricted to just Christchurch. The fact of the matter is that the State housing stock was left in a serious state of disrepair, and we have to insulate it. I think it is a shameful thing that Labour never insulated every—

Mr SPEAKER: Order!

Denis O’Rourke: What real evidence does the Minister have that there is no short-term shortage of affordable housing in Christchurch?

Hon PHIL HEATLEY: Well, I have never said there is real evidence to say there is no shortterm shortage of housing in Christchurch. What I challenge is the Labour Party’s continual use of the word “crisis”—it does not matter whether it is housing, or health, or oil and gas exploration. Labour members sound more and more like the Greens every day, and I cannot distinguish between them.

Hon Annette King: What is the average weekly market rent in Christchurch, according to the average weekly market rent report he receives each week, and have rents gone up in Christchurch in the last 6 months?

Hon PHIL HEATLEY: I do not have that exact figure on hand, but I am more than happy to pass it to the member if she puts the question on paper.


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