Questions And Answers – October 29

by Desk Editor on Wednesday, October 29, 2014 — 7:48 PM



Prime Minister—Statements 1. Hon ANNETTE KING (Acting Deputy Leader – Labour) to the Prime Minister: Does he stand by all his statements?

Rt Hon JOHN KEY (Prime Minister): Yes.

Hon Annette King: Does he stand by his statement “We’ll be coming back over the next weeks and months with concrete policy across a range of portfolios. If we don’t come up with any policy solutions, then I’ll live and die by that criticism.”, which was made in his state of the nation speech in January 2007, in light of the fact that Unicef has said today that the Government’s policies are “ … doing little to protect our most vulnerable citizens from poverty and failure…”?

Rt Hon JOHN KEY: Yes, and I would note a number of things about the Unicef report. Probably the most important of them is that the report shows the importance of economic growth, because the countries that have actually been doing better in terms of improving child poverty are those that have a strong economy, and those that have been doing particularly poorly and have had big increases in child poverty are countries that have had a big recession—

Hon David Cunliffe: Tell us about Australia. Not so flash now.

Rt Hon JOHN KEY: Well, actually, interestingly enough, that is the point, is it not, with Australia—that it did not go into recession, and it did manage to provide more support. I think that is exactly the reason why New Zealanders so roundly rejected Labour’s proposition, because they knew it would be bad for the economy and bad for child poverty.

Hon Annette King: In light of that answer, then, does he realise that Australia, which did not go into recession, as the Prime Minister said, still prioritised children and low-income earners during the global financial crisis, while New Zealand, which did go into recession, instead favoured the wealthy with tax cuts?

Rt Hon JOHN KEY: What is clear is that the member has got amnesia. We were in recession before National even came—

Hon Annette King: That’s not the point.

Rt Hon JOHN KEY: —that is the point; you just said it—in to Government. Secondly, I remember going through an election campaign with one of the Labour leaders—I do not know which; they have had quite a few of them—and that particular Labour leader criticised this side of the House for borrowing money to support the most vulnerable children in New Zealand. That is another reason why Labour got hammered. (uncorrected transcript—subject to correction and further editing)

Hon Annette King: Why did the Government prioritise tax cuts at the height of the global financial crisis, which has given the Prime Minister himself an extra $385 a week, over helping those who were living in the greatest hardship?

Rt Hon JOHN KEY: Again, the member has amnesia, because she forgets that in 2009, despite, actually, the commitment on the campaign trail for tax cuts, the Government actually did not implement that programme. It did so in 2010. [Interruption] It did so in 2010. It did so in a way that was distributionally neutral, as Treasury—[Interruption] Well, interestingly enough, one of the very important parts of that programme was actually the changes made in relation to depreciation on rental properties. What that saw was the Crown’s revenue rising by the order of about $600 million to $700 million. The other thing that was remarkable about that was not only did we know that policy; we could explain it. That is quite different from the capital gains tax that Mr Cunliffe was proposing.

Hon Annette King: Can the Prime Minister please provide today three concrete policies that will reduce child poverty and put food on the tables of families that are in severe hardship, including working families, in the next 3 years of his Government?

Rt Hon JOHN KEY: More work and a stronger economy, and that will certainly be supported by the employment law changes that are going through at the moment, and changes to the Resource Management Act. I hope the members support those. Oh, that is right—you do not need good planning legislation! No. 2: the work we are doing around social housing and making sure that families will have housing to live in. I am more than happy to take an extension of time: if the member wants me to name 10, I am more than happy to do it. No. 3 would be free doctors visits for under-13s—again, the very reason why we are back in Government and Labour got hammered.

Hon Annette King: What is more important to the Government today: announcing $26 million to change the flag or setting some real measures to reduce child poverty that actually put money in their pockets so they can buy the food they need?

Rt Hon JOHN KEY: If the member is claiming, as she seems to be, that the setting of a target is what is going to change the position for young New Zealanders who are in poverty, then that is what is so terribly wrong with the Labour Party. It continues to think that just setting a target, setting up a new committee, having some new little way of looking at things—

Hon Annette King: I raise a point of order, Mr Speaker.

Rt Hon JOHN KEY: No, no, no, you have had your chance. No, no, you have had your chance—

Mr SPEAKER: Order! Is that a point of order? [Interruption] Order! It is a point of order, and it will be heard in silence.

Hon Annette King: My question was what was more important to the Government—whether it was the $26 million to change the flag, or concrete measures. Then the Prime Minister talked about me talking about a target. I had not mentioned one in that question.

Mr SPEAKER: Order! I invite the member to reflect on her question. It was what is more important—the flag or developing some real measures. I think that the Prime Minister in his answer was concentrating on that part of the question.

Cost of Living—Consumer Price Inflation 2. ANDREW BAYLY (National—Hunua) to the Minister of Finance: What reports has he received on recent trends in consumer price inflation?

Hon BILL ENGLISH (Minister of Finance): Last week we had the most recent CPI release. This showed that the cost of living increased by 0.3 percent in the 3 months to 30 September and the cost of living increased by 1 percent in the year to September, down from 1.6 percent in the year to June. This 1 percent annual inflation is less than half of the 2.7 percent increase in average ordinary time weekly earnings in the year to June, so, on average, wages are rising more than twice as much as the cost of living. Inflation is now below the 2 percent mid-point of the Reserve Bank (uncorrected transcript—subject to correction and further editing) target range. This means there is generally less pressure on household and business budgets and less pressure on increases in interest rates.

Andrew Bayly: How does New Zealand’s inflation rate compare with other developed countries?

Hon BILL ENGLISH: We are in about the middle of the pack, bearing in mind that there are quite a lot of developed countries around the world facing the prospect of deflation. In the United Kingdom inflation in the year to September was 1.5 percent, in the US it was 1.8 percent, Canada was 2.1 percent, and Australia was 2.3 percent. They are all comparable with New Zealand’s rate of 1 percent. Price stability through sound fiscal and monetary policy is supporting investment and the growth outlook for New Zealand for real increases in incomes and more jobs. Since 2008 inflation has averaged 2.1 percent per year.

Andrew Bayly: What impact is the lower than expected inflation likely to have on the economy over the next year or 2?

Hon BILL ENGLISH: There will be an update of at least Treasury’s view on that at the half-year fiscal update on 16 December. Economists in general are predicting lower inflation to continue and this could reduce the size of future interest rate increases. Low inflation will also help support continued good conditions for business investment in the creation of new jobs. It will also allow for ongoing real wage increases and help households keep on top of their debt. On balance, low inflation is good for New Zealand and good for the prospects of sustained, reasonable levels of growth.

Rt Hon Winston Peters: If all that is correct, why has the Reserve Bank Governor been starting at shadows and hiking up interest rates all year?

Hon BILL ENGLISH: That is a matter for the governor and I am sure he will have more comments to make in the next week or so. As with most economic policies, it is always easy to see in hindsight where the judgments could have been made differently. In this case, the prospects for the New Zealand economy are reasonably good, and it may be that we avoid the excesses of the last cycle, which that member was party to, where first mortgage rates reached 10 percent and inflation reached 5 percent. We are certainly not going there again.

Andrew Bayly: How could the lower inflation outlook impact on the nominal economy and, by implication, on the Government’s own finances?

Hon BILL ENGLISH: As I have said, detailed forecasts will be set out in the half-year update. However, lower inflation could dampen consumer spending and the size of nominal wage increases, although wages are likely to continue rising faster than inflation. While real annual GDP growth has been strong at almost 4 percent, unusually, nominal GDP growth, which has the largest impact on Government revenue, has been increasing more slowly. It is a very unusual set of circumstances. These trends could have a further knock-on effect on the Government’s books by impacting on the amount of income tax and GST that the Government receives. There have been some signs of this already over the past year. There will be an update on it on 16 December.

Rt Hon Winston Peters: Is that answer shorthand for there is no surplus?

Hon BILL ENGLISH: The impact of the smaller nominal economy on the Government’s books is yet to be seen.

Dr David Clark: Even if the Minister admits he has no new ideas himself, will he accept that monetary policy is broken and out of date, given that inflation is nearly falling below the 1 percent bottom end of the policy targets agreement band, and, yet, the Reserve Bank Governor has been forced to raise interest rates because of his Government’s failure on housing?

Hon BILL ENGLISH: I have got one new idea: maybe Labour should try another leader. That seems to be a new idea that it has regularly—the only new idea that it has. In fact, Government policy has assisted the Reserve Bank in keeping interest rates lower, because we have stuck to pretty tight expenditure growth of around $1 billion a year. As the Reserve Bank has made pretty clear, one thing that would put pressure on higher interest rates would be Government spending (uncorrected transcript—subject to correction and further editing) running out of control, and it is not. So there is a prospect now that households that were concerned that interest rates would continue to increase consistently may find that interest rates do not increase quite as much. They will certainly avoid the excesses of the last cycle under the Labour Government, when first mortgage interest rates reached over 10 percent.

Dr David Clark: When the Governor of the Reserve Bank has had to raise interest rates due to his Government’s failure on housing, why is his Government content to see exporters punished with an overvalued exchange rate, which Treasury says will lead to exports to GDP in 2016 being at their lowest level since Robert Muldoon became Prime Minister—the worst result in 40 years?

Hon BILL ENGLISH: I think we can take a gauge from the fact that the Labour Party is saying there is an export crisis, which probably means exports are really taking off. In fact, there is some evidence that that is the case. The exchange rate has settled back a bit to under US80c. That will assist our exporters, who, by the way, have done a great job over the last 4 or 5 years, increasing their productivity and their resilience. And if it is likely that interest rates will not go as high as expected, that will also assist our exporters.

Bank Deposits—Government Guarantee 3. Rt Hon WINSTON PETERS (NZ First) to the Minister of Finance: Will he introduce a Government guarantee on bank deposits in New Zealand; if so, when?

Hon BILL ENGLISH (Minister of Finance): Depositor protection is in place now through the Reserve Bank’s open bank resolution scheme, which has been thoroughly consulted on and is in place as we speak. This scheme includes a Government guarantee on all depositor funds that are not frozen as part of a bank resolution. Because of recent experience with Government guarantees—that is, the collapse of South Canterbury Finance—and because of the substantial contingent liability associated with any kind of prospect of failure of our large banks, there is continuing work by officials and ongoing discussion with the banking sector around the appropriate level of bank resolution and depositor protection. Managing the risk of bank failure is complex, with potentially large costs to the taxpayer. The Government has to balance the security offered by a Government guarantee to depositors alongside the need for banks to have good incentives to ensure that they are sound financial institutions and will not impose large costs on their depositors, shareholders, creditors, or the taxpayer.

Rt Hon Winston Peters: Why is the Government not following the example of many other developed economies and providing this type of Government guarantee of bank deposits to a reasonable level?

Hon BILL ENGLISH: There has been ongoing discussion about the appropriateness of depositor insurance in our system. The Reserve Bank has implemented what it believes to be a more focused solution—that is, open bank resolution, which includes depositor protection. It really comes down to the matter of the right incentives on the banking system. On the one hand, the reality is that when banks have been threatened with collapse, Governments have provided a guarantee. On the other hand, we do not want to undermine the need felt by the owners and managers of banks to ensure that they cannot play fast and loose with financial risk simply because their depositors will not suffer any losses. The member is pointing, I think, to a pretty finely balanced equation, and because of the significance of this for the Government’s balance sheet, we do make sure there is ongoing testing of the current regime.

Rt Hon Winston Peters: Having regard to this very finely balanced equation, when will the Government or the financiers come to a decision and consider all those countries with a Government guarantee for bank deposits such as Australia, Canada, and the UK to be actually right on this matter now?

Hon BILL ENGLISH: I can assure the member that there is ongoing discussion. For instance, the regime that applies in Australia to our banks is different than that that applies to New Zealand, and those matters are discussed regularly in the Trans-Tasman Council on Banking Supervision. All (uncorrected transcript—subject to correction and further editing) the issues that the member, I know, would want to be raised have been raised in that context. We hope to continue resolving the differences, bearing in mind that each Government has the interests of its own taxpayers and depositors at heart, and they do not always align completely with each other.

Rt Hon Winston Peters: When can we hope that this Government will actually do something, rather than risk another South Canterbury Finance fiasco by not putting a Government guarantee scheme in place before the onset of another financial crisis?

Hon BILL ENGLISH: Again, the member is raising reasonable points. One of the arguments for depositor insurance is that it effectively means that depositors prepay any bailout funds. Of course, that is not costless. That imposes costs on the whole economy, because, effectively, interest rates would have to be a bit higher to achieve that. As I have indicated, the Government has been monitoring both the current regime that is in place—open bank resolution, which does include Government guarantees of depositor funds—and the differences between our regime and, for instance, the Australian one, which is a pretty real-time issue: to have two different regimes applied to the same banks.

Rt Hon Winston Peters: Why is the Government continuing to mull over this issue when it can be seen to be encouraging New Zealanders to put their savings offshore into another country’s bank accounts and have those accounts covered by another Government guarantee, à la Australia?

Hon BILL ENGLISH: Right now I do not think that is the case. As recently as yesterday, Standard and Poor’s, a credit rating agency on which both Governments and bank depositors would rely to assess the soundness of our banks, said that our banks are sound and that the open bank resolution process that is in place is a sound scheme. The member may be referring to events around the implementation of the sovereign guarantees back in 2008-09, and certainly there was a risk then that New Zealanders would remove bank deposits from here and put them in Australia if they believed they were going to be insured there. Again, it is not clear in the future that an Australian Government would tolerate that kind of behaviour either. I am not criticising the member for raising the issues; they are all legitimate issues.

Rt Hon Winston Peters: Could I ask the Minister why this matter is so time consuming to conclude that he is averse to giving guarantees—

Hon Steven Joyce: We don’t guarantee.

Rt Hon Winston Peters: —when, in fact, the Government does guarantee—for that member’s sake—the capital interest held in the Public Trust common fund, for example? Get your facts right, big ears—it does guarantee.

Mr SPEAKER: Order! Just ask the question.

Rt Hon Winston Peters: Well, he wants to chip in. I am telling him—

Mr SPEAKER: Order! This is another example, not different to yesterday, where interjections do not help the order of the House. I am going to invite the member to start his question again.

Rt Hon Winston Peters: That is very reasonable of you, Mr Speaker. Thank you very much. If the Minister and the Government are so averse to giving Government guarantees, why is there a Government guarantee for, for example, capital interest held in the Public Trust common fund?

Hon BILL ENGLISH: At least this member here uses his ears for listening. We could get into the detail of the Public Trust, but it is less than half of 1 percent of the value of banking assets. In fact, it is probably less than about a quarter of 1 percent of the value of banking assets, so we have not paid quite so much attention to the Public Trust. But the member is, I think, rightly raising issues around the nature of the Crown guarantee. In the end, the important thing is that taxpayers are not left with the burden of badly run banks, and that we should have a regulatory regime and a set of incentives to ensure that banks that are large enough to wreck the Government’s books never actually fail. (uncorrected transcript—subject to correction and further editing)

Child Poverty—Prime Minister’s Statements 4. METIRIA TUREI (Co-Leader – Green) to the Prime Minister: Does he stand by his reported statement that “he was proud of the Government’s record in tackling child poverty”?

Rt Hon JOHN KEY (Prime Minister): Yes.

Metiria Turei: Is the Prime Minister proud of his tax policies in light of Unicef’s finding today that his tax cuts for high earners achieved nothing for New Zealand kids in poverty while cash payments to poor families in Australia during the global financial crisis helped to reduce child poverty by 30 percent while also stimulating the economy?

Rt Hon JOHN KEY: I think that the member’s assessment of the report is actually incorrect. Looking at Australia, the reason that its child poverty rates have reduced by 6 percent is that it has actually had a strong economy. I think it is implausible, actually, to claim that a one-off $900 stimulus payment made in one particular year would have an impact on child poverty rates when it was paid after when some of those rates were being measured. So I think the member’s reading of the report is quite incorrect.

Metiria Turei: Why did the Prime Minister cut taxes for the wealthy during the depths of the global financial crisis yet do nothing to improve the outcomes—[Interruption]

Mr SPEAKER: Order! The member has a right to ask the question so it can be heard. Would the member please start—[Interruption] Order! Would the member please start the question again.

Metiria Turei: Why did the Prime Minister cut taxes for the wealthy during the depths of the global financial crisis, yet do nothing to improve the outcomes for New Zealand’s poorest children, something that 18 other OECD countries managed to do despite being hit harder by the crisis than New Zealand?

Rt Hon JOHN KEY: Rather than the member actually criticising the Government’s tax programme, which I think has been at least one contributing factor to a stronger economy, she should, of course, be congratulating the Government, because it is that stronger economy that has seen child poverty rates reduce. It is that strong economy and a continuation of a strong economy that will lift more children out of poverty. And, actually, this Government has done a lot when it comes to making sure that the most needy children get support. That includes borrowing through the financial crisis for Working for Families, for accommodation supplements, and for interest rates relief. It includes expanding the Food in Schools programme—[Interruption]

Mr SPEAKER: As Metiria Turei had a right to have her question heard in reasonable silence, so the Prime Minister has a right to answer the question without the uproar I was experiencing from my left.

Rt Hon JOHN KEY: It has included a wide range of things, like the insulation of homes. A strong economy is the No. 1 way to lift youngsters out of poverty. The Government is exploring a range of different measures it can also potentially implement to help those in the most severe form of material deprivation. But in the end, a strong economy is the thing that will help the most number of New Zealand children.

Metiria Turei: Is the Prime Minister disputing the findings from Unicef’s international report comparing OECD countries and how they managed with child poverty rates over the global financial crisis, which clearly describes New Zealand’s child poverty rates as stagnating under his watch as a direct result of his failure to invest in children, including serious criticisms of his tax cut regime to the very wealthy? Does he dispute Unicef’s findings?

Rt Hon JOHN KEY: What I dispute is the member’s analysis. What the report quite clearly shows, actually, is that child poverty rates reduced under this Government—yes, at not as fast a rate as we would all like, but this country was much more—

Hon David Cunliffe: Stagnated.

Rt Hon JOHN KEY: Well, no one wanted to listen to you during the campaign; I cannot see why they would want to listen to you now. (uncorrected transcript—subject to correction and further editing)

Metiria Turei: Does it concern the Prime Minister that one of the three indicators in the report where New Zealand children are doing worse is food supply—that is, even more New Zealand families report not having enough money from payday to payday to provide enough food for them and their children?

Rt Hon JOHN KEY: Again, what I think you can take from the report is that, firstly, the number of children living in poverty in New Zealand is reducing under this Government. Secondly, if you go and look at the countries that had the biggest increases in child poverty, under the measurements in the report, they were countries like Iceland, Greece, Ireland, Spain, and Italy—countries that follow the kinds of economic plans proposed by the Greens, which is to spend a lot, to tax a lot, and to pretend, actually, that a strong economy is not the solution to helping youngsters out of poverty. This Government is working on a very extensive programme, and it has done so over time, and actually I think, overall, our record, given the circumstances we inherited from the poor economic management of the previous Labour Government, has been quite strong.

Metiria Turei: Will the Prime Minister adopt child poverty reduction targets, given that one of Unicef’s top three recommendations is for the New Zealand Government to implement better data on child poverty, because how can you possibly manage what you do not measure?

Rt Hon JOHN KEY: If the member’s logic is correct, then we should just ignore the Unicef report, because it says that it does not have good information to measure these things.

Social Housing—Initiatives 5. Dr PARMJEET PARMAR (National) to the Minister for Social Housing: What support is the Government providing to help people move from social housing into private rentals?

Hon PAULA BENNETT (Minister for Social Housing): There are around 640 State housetenants who have been paying market rent for more than a year, who could afford to sustain a private rental, and there are people, as we know, who are desperate for those homes. Often the barriers to people moving are around their having to pay a bond, pay moving costs, and, of course, wanting to stay in their community and have their children stay in their schools. All of these can be overcome. Since July this year we have helped 60 tenants by spending a total of $82,000 to help them with the costs of moving and setting up a new home. This not only frees up a State house but stops tenants from getting into unnecessary debt. This is a small cost to the Government but a big help to those individuals.

Dr Parmjeet Parmar: How does this moving support package fit with the Government’s reviewable tenancies policy?

Hon PAULA BENNETT: In July we also began reviewing the tenancies of State house tenants paying market rent, in order to free up houses for others more in need. Many of the people having their tenancies reviewed will get moving costs from the housing support package. More than 200 people are currently in the tenancy review process and there will be more to come. It is proving to be very successful.

Social Housing—Initiatives 6. PHIL TWYFORD (Labour – Te Atatū) to the Minister for Social Housing: What is the “exciting and sexy stuff” she has been considering for social housing?

Hon PAULA BENNETT (Minister for Social Housing): In my desire to liven up an interview on Radio New Zealand, I may have talked up the sexy stuff a little too much. I am not sure it is sexy, but I am sure it is exciting. My statement this morning was around community housing providers and how they can partner with the Government, with developers, with other NGOs, and with those in the private sector. That is exciting—how it can get to the stage of helping vulnerable New Zealanders, with more New Zealanders being housed in better quality homes that suit their needs far better. (uncorrected transcript—subject to correction and further editing)

Phil Twyford: Would it be exciting and sexy stuff to sell off a third of the social housing stock without building any replacement housing, and how exciting and sexy will that be for the 5,500 poor families on the waiting list and living in cars, garages, and caravans?

Hon PAULA BENNETT: This is very much about vulnerable New Zealanders who need assistance to be in warm, safe houses. What we have seen to date is actually poor quality State houses that are the wrong size and in the wrong place. That ain’t working for those New Zealanders who most need assistance. We will house more people in social housing. We just may not necessarily own all of those homes. It will be better for the people, not necessarily better for Government.

Phil Twyford: When she said that every day it gets better, was she referring to the plight of families bringing up their kids in poverty and forced to live in caravans, or was she referring to the routine denigration of poor people on her 6-year watch, once she had pulled up the ladder?

Hon PAULA BENNETT: No one was listening to you for the last 3 months, and they ain’t listening to you now, Phil. So the reality is—

Mr SPEAKER: Order! It is not appropriate to attack the member who has asked the question, at the start of the answer. If the Minister would simply answer the question that has been asked.

Hon PAULA BENNETT: I was talking about—

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. It was worse than that. She was attacking, of all people, you. She referred to you twice.

Mr SPEAKER: If I could just take this opportunity to assist the member. When the word “you” is used it is inappropriate, but it is for the Speaker alone to decide, and that was reviewed in the Standing Orders in the previous Parliament. I would be grateful if all members would not use that as an excuse to interrupt debate or question time.

Hon PAULA BENNETT: I was talking about the 127 people who were housed just last week, including 10 with a community housing provider. I was talking about those people who actually are getting access to better services through Work and Income, because that means that their assessments are more thorough, they have got better options than just a State house, and we are putting more money in to make sure more people get the assistance they need.

Phil Twyford: Has she spoken to the member of Parliament who formerly represented the area that includes the Rānui campground; if so, did she tell her that her department had been routinely referring people to live there in caravans, and that she has been a Minister for only 6 years and doing exciting and sexy stuff takes a lot longer than that?

Hon PAULA BENNETT: You are doing well. Actually, we are the first ones who took that Rānui caravan park seriously. We have been in there, and have been critical of the services and how they provide them. We have not been referring people to it. We actually have work that is under way now. We are serious about doing things differently. The same old stuff will not work, so we need to work with community housing providers. We need to put people first. While that member counts houses, we count people and care about them being in the right house with the right services and the right wraparound.

Phil Twyford: I seek leave to table Housing New Zealand’s emergency housing provider list, which contains dozens of campgrounds and caravan parks.

Mr SPEAKER: I just need the source of the document.

Phil Twyford: Housing New Zealand.

Mr SPEAKER: From what? A website?

Phil Twyford: I am not sure whether it is on the website. It is a hard-copy document. It is not readily available.

Mr SPEAKER: I will accept the member’s word that it is not readily available. On that basis I will put the leave to table that document. Is there any objection to it being tabled? There is none. It can be tabled. (uncorrected transcript—subject to correction and further editing)

Phil Twyford: How does she reconcile her comment that poor families living in caravans are not there by choice with earlier comments that some homeless people are making a lifestyle choice, or did she miss the advice that looking arrogant and conceited about poverty is not a good look for third-term Ministers?

Hon PAULA BENNETT: The angrier you get with me, the better my career seems to go, so that is fine. What I will say is that I visited that caravan park, and what I said was I do not think that it is the right place particularly for families to be in—for children to be growing up in. That is not where we want them to be. But what I will say is there are some people who choose to live there, and enjoy living there, and I see that as their choice. But I do not think that families, and children in particular, should be there.

Phil Twyford: Do homeless families in west Auckland need exciting and sexy stuff or do they simply need a Government that invests in enough emergency accommodation for homeless people, and why does she not use just some of the 520 empty State houses in Auckland?

Hon PAULA BENNETT: Well, we are actually housing more people in State houses and have a faster turn-round than we have certainly just about ever done. We are down to 28 days between tenancies and it—

Phil Twyford: Talk, talk, talk for 6 years

Hon PAULA BENNETT: You have asked the question. I am just giving you your answer. We care about people. I know the member wants to count houses; we want to make sure that people have the quality housing that they can get, which will actually mean that we are addressing some of those children in hardship. That is our priority, and that is what we are working on.

Sue Moroney: I raise a point of order, Mr Speaker. I just want to raise an issue—which I think occurred yesterday as well—with the Minister, who just gave a very rude hand gesture to me across the House. It has been reported to me that she did it on two occasions yesterday during question time, and I think it is going to really disrupt the order of the House if that continues from the Hon Paula Bennett.

Hon PAULA BENNETT: Speaking to the point of order, I certainly did not do a rude gesture at all to that member, and if she takes offence at a wave, then there is something seriously wrong—

Mr SPEAKER: Order! In regard to the point that has been raised by Sue Moroney, the member’s word has been given and it will be taken. But I have got to say that throughout the questions that were asked by Mr Twyford, he and the people sitting right next to him continued to give a barrage of interjection right through the answers, which made it very difficult for me to hear the answer and, I think, would have made it near-impossible for the members asking the question to hear the answer.

Schools—Internet Access 7. SCOTT SIMPSON (National—Coromandel) to the Minister of Education: What progress has been made on ensuring schools have access to fast, reliable internet connections?

Hon NIKKI KAYE (Associate Minister of Education) on behalf of the Minister of Education: I am pleased to advise the House that last week the 1,000th school was connected to the Government’s managed network. My Associate Minister, Nikki Kaye, visited the 1,000th school, Stanley Avenue School in Te Aroha. She was delighted to see that the students were involved in Lego robotics and other new technologies, including 3-D printers. They even have their own television and radio station. Having schools connected to the managed network is part of our commitment to ensure that young people are equipped with the skills they need to be successful in employment and in life, no matter where they grow up in New Zealand.

Scott Simpson: What is the Government investment in fast internet connections and what are the benefits of that investment?

Hon NIKKI KAYE: The Government is investing more than $700 million to ensure that young people have access to cutting-edge technology in schools. This includes more than $200 million (uncorrected transcript—subject to correction and further editing) invested in the managed network. This is about providing quick, reliable internet with uncapped data. I am very pleased that the Network for Learning roll-out is far exceeding expectations, with about 40 percent of New Zealand schools now connected. This means more than 280,000 students and 20,000 teachers are now connected. We are focused on delivering the Government’s vision, which will see young New Zealanders have the best modern learning environment and access to fast internet anytime, anywhere, within school grounds.

Energy Companies, Mixed-ownership—Share Price Performance 8. DAVID SEYMOUR (ACT—Epsom) to the Minister of Finance: What reports has he received on the performance of the share prices of the mixed-ownership energy companies since they listed on the sharemarket?

Hon BILL ENGLISH (Minister of Finance): I have received reports confirming that the three mixed-ownership energy companies are performing better. By that, I mean they are keeping power prices in check because of the competitive market, they are paying higher dividends than they did in Government ownership, and their share prices have increased above their levels on listing. This is good news for consumers. In many cases the average residential electricity price they pay has fallen in the past year. It is also good news for taxpayers, who retain majority ownership in these companies, and for New Zealand investors who bought shares. They are also paying higher dividends. For example, despite selling just under half of its shareholding in Genesis, the Government is forecast to receive twice the dividends from the company this year compared with the best year between 2001 and 2012, when it was the 100 percent shareholder—that is, twice the dividends as a 50 percent shareholder than it received when it was the 100 percent shareholder.

David Seymour: Does the Minister agree that the change in market value post-election provides a good approximation of what taxpayers could reasonably have expected to receive in the initial share offers if not for the risks posed by proposed reform of the electricity sector, and is he aware that the joint market capitalisation of Mighty River Power, Genesis, and Meridian Energy has increased compared with the values in June last by around $1 billion?

Hon BILL ENGLISH: Well, it is a matter of public record that the values of the companies have gone up, but I think the member might be referring to the attempt by Labour and the Greens to sabotage the float. Of course, the irony of that is that the people who suffered most from it are the mums and dads who were scared off, who actually could have bought shares and substantially benefited from them. So we have ended up with the taxpayer having got a bit less and the investors having done a bit more. I do not think that Labour and the Greens were trying to help the investors, but they did.

David Seymour: Does the Minister agree that if the pre-election discount on the energy utilities was of the order of $1 billion, the increased tax burden on New Zealand workers could be characterised in the following way: namely, that it will require the taxpayer by 117,000 New Zealand workers earning the average New Zealand income, working for a full year, before the Government will have recouped in tax what it lost in the discount for risk due to the Labour-Green proposed pricing policy?

Mr SPEAKER: Order! In so far as there is ministerial responsibility—the Minister is certainly not responsibility for the policy of another political party.

Hon BILL ENGLISH: That is an interesting calculation. I have not seen that one before. There is no doubt that the Labour-Greens policy had the effect of transferring wealth from taxpayers to investors who took the risk of buying shares before the result of the 2014 election was known.

Hon Clayton Cosgrove: Does this Government still believe, as he has said in the past, that Kiwis are still not paying too much for their power usage?

Hon BILL ENGLISH: Well, anyone who has paid a power bill is likely to think they have paid too much. What I can tell the member is that the combination of one of the most competitive markets in the developed world, along with the partial sales of the companies, is leading to a (uncorrected transcript—subject to correction and further editing) situation where the energy prices—that is, not including the lines charges, which are the local monopolies—are falling. That started happening about when Labour said: “We’ve got a crisis in electricity prices.”

Accident Compensation Corporation—Public Confidence 9. IAIN LEES-GALLOWAY (Labour – Palmerston North) to the Minister for ACC: Is she satisfied that just 54 percent of the public expressed trust and confidence in ACC according to the corporation’s 2014 Annual Report?

Hon NIKKI KAYE (Minister for ACC): No, I believe that ACC needs to do more to rebuild trust and confidence with New Zealanders. I am confident that ACC has a significant programme of work under way to achieve this. I am also pleased that the annual report shows trust and confidence has been trending upwards for the past few years.

Iain Lees-Galloway: Did former Minister Judith Collins damage public trust and confidence in ACC when she admitted that every New Zealander is paying too much for ACC because the Government is using excessive levies to create the perception that it will achieve a fiscal surplus in the current financial year?

Hon NIKKI KAYE: Well, firstly, I disagree with the statement made in that question. But what I can say in terms of levies is that under our Government we have announced $480 million in levy reductions. That is incredibly significant, and it is a bit rich to get a lecture after the previous Labour Government left us with a huge deficit in 2008-09 of $4.8 billion.

Iain Lees-Galloway: I am going to seek leave to table a media statement, but that is because the Minister refuted the premise of my question—

Mr SPEAKER: Order! Members need to understand that the purpose of tabling a document is not to make a political point.

Iain Lees-Galloway: The purpose is not to make a political point.

Mr SPEAKER: Well, I think that in the way it has been described to me, it is very much about making a political point. The reason people seek leave to table documents is that it is information that is not readily available to members, may be difficult to source for members, and may be informative to members. If it is something that has been in the media, particularly media that is freely available to members, I do not intend to start putting the leave.

Chris Hipkins: I raise a point of order, Mr Speaker. In a ruling that you made—it was either earlier this week or last week—you referred us to a Speaker’s ruling that requires any statements made in a question to be authenticated, so if there is any factual material in a question, it needs to be authenticated. If a member is not able to table a document to authenticate that claim, what is the appropriate way for them to authenticate any claim that they might be making in a question?

Mr SPEAKER: The member, I think, is confused between a primary question and a supplementary question. The authentication is required for a primary question, and that is required in the process when it is lodged to the Clerk’s Office, and they will be accepted with authentication. With regard to supplementary questions, I have to judge relatively immediately whether it is a reasonable question, and I do that, but it is not as if there is an ability to then table information that substantiates the authentication of a supplementary question. So in this case, the primary question was authenticated, it was immediately answered in the very first word by the Minister, and we have now moved to a supplementary question. The way forward, as I continue to advise the House, is further incisive supplementary questions.

Iain Lees-Galloway: Does the Minister accept—

Hon Dr Jonathan Coleman: World weary—he’s not happy. That’s a big sigh.

Iain Lees-Galloway: Are you all right? Does the Minister accept that over the 6 years that National has been in Government, New Zealanders have overwhelmingly come to perceive ACC as difficult to deal with, likely to breach their privacy, likely to litigate against claimants, and overcharging them for the privilege; if not, why not? (uncorrected transcript—subject to correction and further editing)

Hon NIKKI KAYE: No, I do not accept all of the statements made by that member. What I can say is what I have said in answer to the primary question: there is more work to do. Obviously, by a percentage that shows 54 percent public confidence, we have to do better. Let me outline some of the progress that we have made. Firstly, you can see at an investment level that ACC is now essentially fully funded. That is an extraordinary achievement for this Government, given that we were left in a situation of a debt of $4.8 billion in terms of deficit. Secondly, at an organisational level it is very clear—and I am meeting with the board tomorrow—that it has a huge programme around both updating information and communication technology systems to ensure that we have better progress around issues like privacy but also that a huge amount is being done in terms of claims management. I am confident that ACC is on the right track.

Iain Lees-Galloway: Will this morning’s article in theNew Zealand Herald damage public trust and confidence in ACC, given that it detailed an attempt to cover up information about fraudulent activity, that the cover-up itself was bungled, that when pressed about the extent of fraud, ACC could only say that the information it used was not robust, and that an accurate figure for the level of fraud has not been provided?

Hon NIKKI KAYE: In terms of the article in the New Zealand Herald, I do not believe that it will actually damage public trust, because you need to understand that the data is—and I want to outline why, for a number of reasons—11-year-old data. The data was from 2,000 clients, and that is out of a total of about a billion claims. So, firstly, it was a very small sample. I also understand that the figure that was quoted of 8 percent to 10 percent was not the proportion that was fraudulent; it was the proportion that needed another look. So it is old data, it is a small sample, and it is ropey.

Iain Lees-Galloway: Given that the Minister is not satisfied with the level of public trust and confidence in ACC, does she believe that the two initiatives to address public trust and confidence listed in the service agreements between ACC and former Minister Collins, which are “refresh our communications strategy” and “social media”, will be enough to improve confidence in ACC, or does she think it might take something a little bit less superficial than that?

Hon NIKKI KAYE: In terms of the corporation’s programme to improve public confidence, there is a range of initiatives. There is a range of initiatives. The member is referring to a different document. He is not referring to the annual report. If he reads the annual report, he will see that not only is there a significant investment plan in terms of dealing with the privacy issues, and not only is the ACC doing a huge amount around sensitive claims, which is very important, but, thirdly, the Government is looking at the long-term funding policy. When he drills down, when he does the work and reads the annual report, he will see that one of the areas where we do need to improve public confidence is around businesses’ interaction with the ACC. There is a huge amount to do in terms of that administration side because that is where the public confidence is partly very low.

Marama Fox:

Hon NIKKI KAYE: Just in terms of the translation of that question, I got only half of it, I think—

Mr SPEAKER: I invite Marama Fox to either repeat it in Te Reo, or, if she wants to, she can now repeat the question in English—whichever she would rather do.

Marama Fox: Perhaps I will repeat it in English. How is the Minister planning to address the projected 10 percent increase in new sensitive claims each year, and what plans does she have in place to involve whānauin the recovery process?

Hon NIKKI KAYE: That is a very good question. Firstly, one area where the Government is very focused, and also the corporation is very focused, is the prevention of sexual violence. We have a strategy and an action plan around that, and they involve a number of Government agencies. The second thing I would say is I am advised that ACC is currently in the final stages of tendering for new suppliers and providers around some of those sensitive claims. That is very important so that we have more providers. Thirdly, with regard to family and whānau support, I am pleased to confirm that family and whānau of sensitive claims clients will receive support through the (uncorrected transcript—subject to correction and further editing) introduction of up to 20 hours of family and whanau support, depending on family need. I can confirm that this will be available by the end of the year.

Hon Te Ururoa Flavell: I raise a point of order, Mr Speaker. Tēnā koe, Mr Speaker. Can I just ask the Minister with respect to the question, because I was not listening to the translation, for further information, just in case other members, Māori members, use Te Reo and we have to switch into English, which defeats the purpose. Was the issue that the Minister did not get a good translation, that the Minister did not get a translation, or that the translation was unclear—just for the purposes of—

Mr SPEAKER: I am sure I can answer that on behalf of the Minister. The Minister did not manage to realise it was going to be in Māori. She did not grab the headpiece in time to listen to the translation, so she picked up the latter part of the—[Interruption] I will let the Minister explain her own reasoning.

Chris Hipkins: I raise a point of order, Mr Speaker.

Mr SPEAKER: No, I am going to hear from the Hon Nikki Kaye first so we will get an explanation.

Hon Nikki Kaye: I was listening, and I heard only half, I think, of what the translation was, and other members may be able to confirm that.

Chris Hipkins: I am happy to speak to this, because I also was listening to the translation, and the translation bore very little correlation to the question that was then asked in English. This is quite a serious issue for the House, because we previously had a situation where questions were asked first in Te Reo Māori and then in English, and we moved to a system where we had simultaneous translation. If that translation is not going to actually translate what is asked, then we are going to have to reassess that. I listened very carefully to the translation. I can fully understand why the Minister did not understand what the question was. I did not understand what the question was either.

Mr SPEAKER: Thank you. I appreciate that. When I finally got my headpiece on, again, I found much the same as the member Chris Hipkins has said. We need to now investigate whether it was an issue to do with the translation, because it is critical, if we are going to rely on the translator, that we have an accurate interpretation of the question that is asked. Otherwise, it could lead to all sorts of difficulties for a Minister. I will look into the matter.

Drink-driving—Identification of Offenders 10. MIKE SABIN (National—Northland) to the Minister of Police: What recent developments is he aware of to help identify drink-drive offenders?

Hon MICHAEL WOODHOUSE (Minister of Police): Last week I launched the national roll-out of the Booze Bus Biometrics system. The Booze Bus Biometrics system will enable police to confirm within minutes the identities of people in the system whom they intend to charge with drink-driving offences by electronically scanning fingerprints, taking digital photographs, and comparing the data with existing police records. The Booze Bus Biometrics system will be installed in all 21 police booze buses by the end of November.

Mike Sabin: What are the benefits of the Booze Bus Biometrics system?

Hon MICHAEL WOODHOUSE: Identifying high-risk drivers and recidivist drink-drivers at the roadside means that police will be able to respond quickly and appropriately to circumstances and ensure that alleged offenders are charged appropriately from the outset. We have made very good progress in reducing death and injury on our roads, but alcohol-related death and injury remain stubbornly high. The Government has introduced tougher penalties for serious and repeat drink-drivers. These tools will assist police to continue to do their jobs more effectively. (uncorrected transcript—subject to correction and further editing)

Prime Minister—Staff 11. Dr RUSSEL NORMAN (Co-Leader – Green) to the Prime Minister: Did Jason Ede report to the Prime Minister’s chief of staff Wayne Eagleson while employed as a Senior Ministerial Advisor in the office of the Prime Minister; if not, to whom did he report?

Rt Hon JOHN KEY (Prime Minister): Yes.

Dr Russel Norman: Did he or his chief of staff give approval to his employee Jason Ede to access the Labour Party’s private database without permission, an action that Mr Ede took in May 2011 while on the staff of the Prime Minister?

Rt Hon JOHN KEY: No, but I would point out to the House that Jason Ede accessed parts of the Labour Party website that were publicly available.

Dr Russel Norman: Is the Prime Minister saying that if he left the door open to his Parnell home and someone walked in, wandered around, and took some stuff without his permission that would not be stealing?

Rt Hon JOHN KEY: If the member wants to talk about stealing, let us talk about Nicky Hager and where he got his emails from.

Dr Russel Norman: I raise a point of order, Mr Speaker. [Interruption]

Mr SPEAKER: Order! [Interruption] Order! A point of order has been raised.

Dr Russel Norman: The Prime Minister has not attempted to address the question, which was directly relevant to his previous answer, by making an analogy between the breaking into of the Labour Party website and going into the Prime Minister’s house. He has not addressed the question at all.

Mr SPEAKER: I think on this occasion, in my opinion, the member has not helped his own point of order by talking of an analogy. The Prime Minister then, in his answer, used yet another analogy, which was that it was similar, in some ways, according to the Prime Minister, to entering into a house uninvited. I will allow the member an additional supplementary question.

Dr Russel Norman: Is he—

Hon Christopher Finlayson: This is why James should be the leader.

Dr Russel Norman: Chris is such a lovely man, is he not?

Mr SPEAKER: Order! Could we just have some silence from my right to get through question time.

Dr Russel Norman: Is the Prime Minister satisfied that his office upheld the highest ethical standards when his employee Jason Ede accessed the Labour Party’s private database without permission?

Rt Hon JOHN KEY: In answer to the first part of the question, yes.

Dr Russel Norman: When did he or his chief of staff become aware that Jason Ede, while employed on the Prime Minister’s staff, in his office, had accessed the Labour Party’s private database without permission from the Labour Party?

Rt Hon JOHN KEY: My chief of staff became aware of the fact that Mr Ede had gone into the part of the Labour website that it had failed to properly secure, that its members apologised to their supporters for this, and that the database was publicly available some time after that event occurred.

Dr Russel Norman: I raise a point of order, Mr Speaker. You were slightly distracted at the end of the Prime Minister’s answer, and the date was not very clear from the end of his answer. I wonder whether you can tell us on what date he had found out, because I could not hear from over here.

Mr SPEAKER: The Prime Minister did not give a specific date and you would hardly expect him to have that information in the House.

Dr Russel Norman: Is the Prime Minister now saying that it is acceptable behaviour for ministerial staff to go into private databases—which they have no right to go into; they have not gained permission to go into them—take the data from those databases, and share it with attack bloggers like Slater? Is that now acceptable, ethical behaviour for ministerial staff? (uncorrected transcript—subject to correction and further editing)

Rt Hon JOHN KEY: What I am saying is that that part of the website was publicly available for people to go into. What I am also saying to the House is that, no, I do not agree with Nicky Hager being part of an action to steal emails. I do not agree with people coming to the National Party cocktail party and secretly taping our people. No, I do not agree with people secretly taping other activities undertaken by us. I think the member, actually, should pick up a mirror and have a bit of a look.

Prime Minister—Communication with Blogger 12. Dr MEGAN WOODS (Labour—Wigram) to the Prime Minister: Was he acting in his capacity as Prime Minster during the 14 February 2014 press conference when he confirmed to journalists that he speaks to Cameron Slater “every so often” including that same week when they discussed Mr Kim Dotcom “briefly”?

Rt Hon JOHN KEY (Prime Minister): No, I spoke to Cameron Slater in my capacity as the leader of the National Party, and therefore questions from the media about the conversation were answered in that same capacity. By way of clarification, earlier this year I was frequently asked at my press conferences whether the National Party would reach an electoral accommodation with other political parties. As would be obvious to the member, I responded to the questions as the leader of the National Party. There have also been other examples: when I was asked to comment about Max’s selfies, or Stephie’s penchant for photos covered mostly in sushi, or the health of Moonbeam the cat. I do that in my capacity as a father.

Dr Megan Woods: How can he say that he was not acting as Prime Minister at that press conference when he directly referred to “myself as Prime Minister”, had a ministerial staffer standing behind him recording the proceedings, and was answering questions from journalists that related to his prime ministerial responsibilities?

Rt Hon JOHN KEY: Because, as the member should well and truly know, I wear several hats, and I answer questions in press conferences for several reasons. As I just pointed out to the member, quite often I answer questions for which I have no ministerial responsibility because I am acting as the leader of the National Party.

Dr Megan Woods: I seek leave to table a screenshot of the prime ministerial stand-up—

Mr SPEAKER: Order! The member will resume her seat. The member is now just abusing the privilege of seeking leave to table a document.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. As an evidentiary matter, frequently a photograph has been used as compelling proof of some event. It has happened in many court cases and many events. Much of it has been televised. I want to know what the distinction is between a photograph like that, which could be so important in some cases as proof—

Mr SPEAKER: Order! The member will resume his seat straight away. [Interruption] Straight away. Within only the last 10 or 15 minutes I have given an explanation as to why people seek the ability to table a document. It is to inform the House. It is not to make a political point. A shot of the Prime Minister at a press conference does nothing to give further, useful information to this House. I will not put the leave, and I will not see this system further abused by a member. I was very tempted to cease the question there and then. On this occasion, I will give the member the benefit of the doubt and allow her to complete her questions.

Dr Megan Woods: How was the information that he said he had confirmed by a member of the public regarding Kim Dotcom transferred from himself as the party leader to himself as the Prime Minister when he referred to it in Parliament as the Prime Minister on 12 February 2014?

Rt Hon JOHN KEY: Someone told me. I actually do have some sympathy for Megan Woods. She is holding up a picture of a leader of a party, but that is because she is desperate for her—

Mr SPEAKER: Order! That will not help the order of the House. (uncorrected transcript—subject to correction and further editing)

Dr Megan Woods: When he told journalists on 14 February 2014 in his capacity as the Prime Minister that “A member of the public, for want of a better term, rang me up and said what was the case.”, was Cameron Slater that member of the public?

Rt Hon JOHN KEY: That information was in my capacity as the leader of the National Party.

Dr Megan Woods: If he is the Prime Minister and confirms information using taxpayer resources that he then refers to in the House as Prime Minister, how is that not in his ministerial capacity?

Rt Hon JOHN KEY: The member should email Helen Clark at

Dr Megan Woods: When he has received information from Cameron Slater has he ever asked any of his taxpayer-funded staff to follow up on information passed to him by Cameron Slater?

Rt Hon JOHN KEY: No.


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