Questions and Answers – April 1

by Desk Editor on Wednesday, April 1, 2015 — 6:37 PM


Prime Minister—Statements on Northland By-election 1. Rt Hon WINSTON PETERS (Leader—NZ First) to the Prime Minister: Does he stand by all his statements regarding the Northland by-election?

Rt Hon JOHN KEY (Prime Minister): Yes, in the context they were given.

Rt Hon Winston Peters: Does he stand by his statement regarding the 10 one-lane bridges that “these bridges need upgrading and they will be.”; if so, how does he explain a massive variation in costings of between $32 million and $69 million?

Rt Hon JOHN KEY: In answer to the first part of the question, yes; in answer to the second part of the question, not all the work has been done to be absolutely sure of what the final costs will be. That is standard whenever we do procurement around new infrastructure like roading.

Rt Hon Winston Peters: Whose idea was it to double lane the 10 bridges, and on what date was he informed that the announcement would be made?

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

Rt Hon Winston Peters: Well, how does he square that answer with the Northland National Party candidate’s statement that it was his idea? Who is not telling the truth here?

Mr SPEAKER: Order! The question has been asked.

Rt Hon JOHN KEY: The member did not ask me where the idea originated from.

Ron Mark: I raise a point of order, Mr Speaker. I know that you study the Hansards of questions and answers and I know that you are fully aware that these questions were asked on 10 March and on 17 March, and that the Ministers and Cabinet, particularly the Minister of Transport, have had all that time to get these answers right and to be able to answer them truthfully in the House. I ask that you require them to do that.

Mr SPEAKER: Order! I am not sure that is a point of order, but if the member thinks that an answer has been given in this House that is incorrect, there is an appropriate way to deal with that, and it is not via a point of order.

Ron Mark: I raise a point of order, Mr Speaker. But surely it would be far cheaper for the taxpayer if we do not go through—

Mr SPEAKER: Order! The member will resume his seat. That is certainly not a clarification and it is not a point of order.

Rt Hon Winston Peters: Is he in favour of the “Darby and Joan” Bridge being double-laned, considering that it would require cutting down two landmark, protected native kauri trees, and that very low numbers of vehicles actually use the bridge—often just to see those kauri trees?

Rt Hon JOHN KEY: I am advised that the member is incorrect in the assumptions he made in his question.01 Apr 2015 Oral Questions Page 2 of 14 (uncorrected transcript—subject to correction and further editing)

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. What has happened here is that the Prime Minister has got up and challenged the very veracity of the question, which simply was that it is a landmark bridge—[Interruption]

Mr SPEAKER: Order! This is a point of order.

Rt Hon Winston Peters: —and it got an environmental award because it harmonises with the two kauri trees, and he says I am incorrect with my assumptions.

Hon Gerry Brownlee: Point of order.

Mr SPEAKER: No, I do not need assistance from the member. The member asked a question. The Prime Minister disputed the facts that are in that question. That is the right of the Prime Minister. The way forward is supplementary questions.

Rt Hon Winston Peters: Point of order, Mr Speaker.

Mr SPEAKER: No, I have ruled on this matter. I am not putting up with a repetition of yesterday where my points—[Interruption]

Mr SPEAKER: Would the member sit down. [Interruption] Order! I am very tempted to be asking the member to leave. The member can continue asking his supplementary questions if he has some left, but I have ruled that the question that was asked has been addressed.

Rt Hon Winston Peters: When I said that somebody was in favour of the “Darby and Joan” Bridge being double-laned and that it would end the landmark, historical, and environmental award given to this bridge because of the kauri trees that have to be cut down, which one of those assumptions was wrong?

Rt Hon JOHN KEY: That was not the question the member asked me.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. I have studied the Westminster system all around the world, and I have never seen—

Mr SPEAKER: Order! [Interruption] Order! A point of order has been called. I will listen to it and I expect to listen to it in silence. Would the member quickly get to his point of order.

Rt Hon Winston Peters: My point of order is that I am asking the Prime Minister to outline what assumptions he says we have got wrong in our questions on this matter.

Hon Gerry Brownlee: I raise a point of order, Mr Speaker. I think the problem here is that had Mr Peters been able to table a full design specification for the renewed “Darby and Joan” Bridge, he might be able to make the assertions he has, but he cannot and he does not need to make these assertions until that is the case.

Mr SPEAKER: I am not sure that helps us forward in this case. The Rt Hon Winston Peters has now been—

Rt Hon JOHN KEY: Point of order.

Mr SPEAKER: No, I am on my feet. He has repeated now a question that is not the question he asked and that is the difficulty. The question was a very long-winded question. The Prime Minister has addressed that question—I accept not to the member’s satisfaction. [Interruption] Order! The way forward is further supplementary questions. It is not to then question the answer that has been given.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. I asked this question No. 4 in one way and the answer was that I got the assumptions wrong. I asked the question in a different way—

Mr SPEAKER: Order! Again, I have dealt with this. Sit down. The member asked the question. The Prime Minister addressed the question—I have said, to my satisfaction; I accept it is not to the member’s satisfaction. The way forward is further supplementary questions.

Rt Hon Winston Peters: Is he in favour of the “Darby and Joan” Bridge being double-laned, considering that it would require cutting down two landmark, protected native kauri trees, and that very low numbers of vehicles actually use the bridge—often just to see those trees?

Rt Hon JOHN KEY: In answer to the first part of the question, yes. In answer to the second part of the question, the member is wrong. The trees will not be cut down.01 Apr 2015 Oral Questions Page 3 of 14 (uncorrected transcript—subject to correction and further editing)

Economy—Reports 2. ALASTAIR SCOTT (National—Wairarapa) to the Minister of Finance: What reports has he received showing how the performance of the New Zealand economy is translating into benefits for New Zealand families?

Hon BILL ENGLISH (Minister of Finance): Yesterday ANZ released its economic outlook report for March. It indicated that the momentum of last year’s economic growth is likely to continue into this year, and it expects 3 percent growth for this year. It points out that there are risks to the New Zealand economy related to low energy and low commodity prices, but it expects job growth, wage growth, and continued low interest rates, which for households means job security, moderate wage increases, and a greater ability to repay debt rather than pay higher interest rates.

Alastair Scott: What measures come into effect today that will directly benefit New Zealand families?

Hon BILL ENGLISH: The prospect of sustainable economic growth means that the Government is able to act to support families. So from 1 April paid parental leave will increase by 2 weeks to 16 weeks, and by another 2 weeks on 1 April next year. The parental tax credit will rise from $150 a week to $220, and the entitlement will increase from 8 to 10 weeks. Average ACC work levies will fall to 90 cents from 95 cents. The HomeStart scheme starts on 1 April, which will enable around 90,000 New Zealanders to be assisted to buy their first homes. New Zealand superannuation will increase by another 2 percent, meaning that it has increased by 31 percent since April 2008, more than double the inflation rate.

Dr David Clark: In light of the primary question, when considering how the performance of the New Zealand economy is translating into benefits for New Zealand families, has he considered the household labour force survey, which shows growing unemployment in every region of New Zealand since his Government came to power?

Hon BILL ENGLISH: On “Planet Labour” there was no global financial crisis, but in New Zealand there was. So, just to remind the member: unemployment went up pretty sharply in 2008, 2009, and 2010, and it has been dropping fairly consistently since. It is still too high, although I might notice that it is significantly lower than Australia’s, where unemployment is rising, which accounts for the fact that many New Zealanders are voting with their feet and staying home and coming home because they have a good prospect of getting a job here.

David Seymour: How is it that the Government can afford to hand out so much money and index so many benefits on 1 April, and yet does nothing to index tax thresholds to inflation for the benefit of the people paying for it all?

Hon BILL ENGLISH: That is a fair question, and, as I think was indicated by my colleague the Minister for Economic Development last week, that is something that will be discussed in the context of future options for moderate tax reductions for New Zealanders. But I might say that at the moment inflation is around zero and that is enforcing a discipline on the Government because we are not collecting more tax because of fiscal drag, which is a very unusual if not unique set of circumstances. But this Government is a responsible manager of the Government’s finances, and we will try and deal with that pressure.

David Seymour: In light of the Minister’s reference to a unique set of circumstances where fiscal drag is low, is this not the perfect time to make the switch and index tax brackets to inflation?

Hon BILL ENGLISH: No, it is not the perfect time, but it is the perfect time to start such a discussion.

Alastair Scott: How is the Government able to deliver to households the benefits of sustained growth in the economy?

Hon BILL ENGLISH: We can deliver some benefits of sustained growth, but I must say that for most households it is their workplace that is delivering those benefits, such as more job security in a growing economy; moderate wage increases year on year, which over time will lift our average wage by $5,000 to $6,000 over the next 4 years; and, of course, the general economy, in which 01 Apr 2015 Oral Questions Page 4 of 14 (uncorrected transcript—subject to correction and further editing) interest rates are lower than they might otherwise have been, and that gives households more opportunity to pay off debt. The Government can contribute, of course, through its fiscal policy, where we believe that the measures such as those that that are coming in on 1 April are moderate but supportive of families, and that is some of the benefit that they get from a well-managed economy.

Alastair Scott: What did the ANZ report say about risks to the economy?

Hon BILL ENGLISH: I think it pointed out some of the risks that have been discussed in the House before. Part of that is very important, and it is around the outlook for our trading partners. So with China and Australia, both economies have some question marks as to their rates of growth. There are also question marks over the current low commodity prices, particularly in the dairy industry, and the extent to which they stay low or bounce back to what we would regard as a long-run acceptable and normal price level. Fortunately, the New Zealand economy is resilient. It has proven it can deal with headwinds, as it has done over the last 4 or 5 years quite successfully, and we have every confidence that even if some of these risks eventuate, we will be able to handle them.

Accident Compensation—Levies 3. ANDREW LITTLE (Leader of the Opposition) to the Prime Minister: Does he stand by his statement that “falling off a high horse in Northland can force ACC levies up”; if so, is that why the Government has set work and earners levies above the levels recommended by ACC?

Rt Hon JOHN KEY (Prime Minister): I say to the junior leader of the Opposition—

Mr SPEAKER: Order!

Rt Hon JOHN KEY: —yes and no.

Mr SPEAKER: Order! [Interruption] Order! It is that sort of start to the answer that does not help the order of this House.

Andrew Little: Is his concern about horses in Northland really about high horses, or well-run thoroughbreds?

Rt Hon JOHN KEY: All I know is that in 2014, like in 2011 and 2008, we went off to the races and we won big time.

Andrew Little: Given that ACC itself has recommended against the $350 million overcharge, why is National forcing Kiwi businesses and workers to pay excess ACC levies that even ACC says it does not want or need?

Rt Hon JOHN KEY: I would remind the member, firstly, that the ACC board often makes a range of recommendations. In 2010-11 the Government actually increased ACC levies by $1.137 billion less than what was recommended by ACC. Today, actually, I read an interesting quote that said the following: “The Employers’ levy remains the same at an average of 90 cents per $100 of payroll. Although ACC recommended a reduced levy rate of 85 cents, the government decided there was a need to give employers more stability in levy rates from year to year, as well as building up reserves.” That was from Lianne Dalziel, Labour’s ACC Minister in 2002-03.

Andrew Little: Moving on 13 years to this year, is it in the public interest, particularly the interests of levy payers, for ACC to take more in levies than it needs and more than it wants when its work and earners accounts are already overflowing; if so, how?

Rt Hon JOHN KEY: I take it from the member that he is thinking that we should do as he says, not as Labour has done. That seems to be the subtext of his question. I go back to the point I made earlier. Over time the ACC board has made a series of recommendations. The Government adopts what it thinks is right. It is on track to do that. As you know, from 1 April—today—there have been further cuts. There will be more on 1 July, I think from memory. It is on track for about $1.5 billion worth of cuts in the last 12 to 18 months alone.

Andrew Little: Given his failure to end his ACC rip-off this year, will he now commit to cutting next year’s ACC levies by at least $350 million in the coming Budget; if not, why on earth not?01 Apr 2015 Oral Questions Page 5 of 14 (uncorrected transcript—subject to correction and further editing)

Rt Hon JOHN KEY: What the Government will do is get a further set of recommendations, as is required by law, from the ACC board and consider those in context. But I would make a couple of points, and that is that if one looks at ACC and the factors that drive its levy recommendations, one sees that there are a number of moving factors in there, including the discount rate. So the member just better be a little bit careful what he wishes for, because the ACC board may well come out with a recommendation he does not like.

Andrew Little: Why did he fail to tell New Zealanders that most of his ACC reductions were just reversing his Government’s earlier levy hikes, put in place because of Nick Smith’s creative and fake crisis as the smokescreen for privatisation? Why does he not reverse those? Tell the truth.

Mr SPEAKER: Order!

Rt Hon JOHN KEY: It is true that this Government put up ACC levies when we first came into office. [Interruption] Interestingly enough, the member says “unnecessarily”. The recommendation from the board, which, by the way, he wants us to adopt this year, was to put them up by $1.3 billion, and the reason the board wanted them to go up by so much was that Labour left ACC unfunded and broke. What a disgrace from the Labour Opposition. What a disgrace.

Housing Market—Impact of Government Initiatives 4. Dr RUSSEL NORMAN (Co-Leader—Green) to the Minister for Building and Housing: Does he agree with the Reserve Bank Governor’s advice in relation to proposed changes to the Welcome Home Loan Scheme and KiwiSaver Subsidies that “over the longer term, subsidies have the potential to add to existing house price pressure in what is a highly overvalued market”; if not, why not?

Hon Dr NICK SMITH (Minister for Building and Housing): The member overlooks two important facts in the advice from the Reserve Bank Governor. The first is that it was dated 18 June and was directed at an earlier version of the HomeStart package in which it was proposed to increase grants for buying existing homes by 50 percent. The final HomeStart package agreed by Cabinet on 18 August took this advice into account and left the grants for existing homes as is. The second fact is that the member does not include the Reserve Bank Governor’s complete advice, in which he said: “The targeting of a higher subsidy for new homes would be expected to have a positive effect on new housing supply.” Consistent with this advice, the final package doubled only the subsidies for new housing supply.

Dr Russel Norman: With regard to new housing supply, does he agree with the Reserve Bank Governor that increasing these subsidies will result in “higher margins for developers and builders”?

Hon Dr NICK SMITH: Again, the member is being cute with his quotation. He forgot the word “might”—forgot the word “might”. Actually, it is our view that by providing a grant to the homeowner, we can have confidence that they will shop around and get themselves the very best deal. We do not agree with those members’ policy, and that is that they do not trust homeowners and they want the State to build the houses they think homeowners want.

Dr Russel Norman: By how much have median house prices risen in Auckland since his Government took office?

Hon Dr NICK SMITH: There is new data on house prices out today. It shows that in the course of the 6 years of this Government house prices in Auckland have gone up by an average of 5 percent per year. It is interesting to compare that with what house prices went up by on average under the previous Government, where the average was 10 percent per year, or double—that is, house prices were going up an average of double during the previous Government’s 9 years.

Dr Russel Norman: Is the Minister aware that the median house price in Auckland has gone up under his Government by more than $250,000, and does he think that is sustainable?

Hon Dr NICK SMITH: No, I do not think it is sustainable. That is why this Government has passed more legislation in respect of housing than any Government in the last 20 years.01 Apr 2015 Oral Questions Page 6 of 14 (uncorrected transcript—subject to correction and further editing)

Phil Twyford: Tinkering and photo ops.

Hon Dr NICK SMITH: The member says that it is tinkering. I would suggest that the special housing areas legislation—which has opened up land for 34,000 houses; more land has been opened up in Auckland in the last 12 months than in the last 10 years—is the sort of policy that is required. The biggest cost increase in Auckland has been in the price of the section, and it is actually the sort of policy that is advocated around a tight metropolitan urban limit, which the Green Party supported, that is at the core of Auckland’s house prices.

Dr Russel Norman: In light of the fact that this Government has now been in office for more than 6 years, what responsibility does he take for the fact that median house prices in Auckland have increased by more than a quarter of a million dollars, and how on earth are people supposed to afford those kinds of house price increases?

Hon Dr NICK SMITH: The first point I would make is that when we came to Government New Zealand was building 1,000 houses per month. The latest figures, which came out yesterday, show that we are building 2,000 houses per month, and an increased supply is at the core. I had also missed this: New Zealand is a much more popular country to live in. We do not have 50,000 people a year leaving to Australia. As a consequence, there is more demand. We on this side of the House welcome that, but we also accept the challenge that we have to build a lot more houses, given that we are now a much more popular country to live in.

Dr Russel Norman: Does he think that giving $10,000 or $20,000 subsidies to a couple to buy their first home outweighs the $250,000 increase in the price of housing in Auckland, and is it not only a drop in the bucket compared with that price increase?

Hon Dr NICK SMITH: In 2007 the previous Government introduced the subsidies for people to buy a house—at that point $10,000. In that year house price increases were faster than they are now. The Green Party is on record in 2007 saying that grants for first home owners were a great thing. It seems the consistency of the Green Party is that when the previous Government provides a grant for first home owners it is a great idea, but somehow when we do that it is not a good idea. That does not sound very principled to me.

Dr Russel Norman: In light of the $250,000 increase in the median price of houses in Auckland under this Government, will he reconsider his policies of taking no action to restrict demand from investment buyers through a capital gains tax or from offshore demand through non-resident foreign buyers?

Hon Dr NICK SMITH: The evidence is very clear, particularly in the Productivity Commission’s comprehensive report, that the biggest contributor to increased house prices is sections in Auckland. They have gone from $100,000 each in 2000 to $350,000. The key driver of that has been the metropolitan urban limit. That is why this Government has made the No. 1 priority breaking that metropolitan urban limit, which we have done with our special housing areas. I wish the member would simply accept that link between dumb planning policies and high house prices.

Resource Management Act Reforms—Impact on Auckland Housing 5. PHIL TWYFORD (Labour—Te Atatū) to the Minister for the Environment: Is he, like the Prime Minister, relaxed about the effect of dropping major RMA reforms on new housing supply, and does he agree with the Prime Minister that there are “mixed views” about how much his reforms would have addressed Auckland’s housing shortage?

Hon Dr NICK SMITH (Minister for the Environment): I have checked, and the Prime Minister’s comments were specifically in respect of the changes to sections 6 and 7, of which there are mixed views. The Prime Minister equally made the point: “the procedural changes are very important.” For instance, the Housing Accords and Special Housing Areas Act, which bypassed the more clumsy procedural parts of the Resource Management Act, has freed up land supply for 43,000 homes in Auckland. This law expires in September next year, and our Resource Management Act reforms need to ensure ongoing land supply and residential development.01 Apr 2015 Oral Questions Page 7 of 14 (uncorrected transcript—subject to correction and further editing)

Phil Twyford: When the Prime Minister said yesterday that there are mixed views about how his Resource Management Act reforms would have addressed the Auckland housing shortage, was this because Nick Smith says that the Resource Management Act is to blame for the rising cost of housing and hardly anyone else agrees?

Hon Dr NICK SMITH: Every member of this House knows that the Resource Management Act is the primary law that governs the creation of sections. The price of sections in Auckland has gone from $100,000 in 2000 to an average of $375,000 today. If we are serious about improving house prices, we have to focus on section prices, and the Resource Management Act is critical to resolving that issue.

Phil Twyford: Which quote best describes his Resource Management Act announcement in January: “An attempt to manipulate public sentiment with unsubstantiated claims, rhetoric, and at times misleading analysis.”, that was the Listener; “[jumbled] together anecdote and slogans, common sense, and windy abstractions.”, that was the Dominion Post; or “A blunderbuss attempt to obliterate the RMA.”, that was Radio New Zealand?

Hon Dr NICK SMITH: I could cite hundreds of sources that received this Government’s Resource Management Act reforms very positively, and I actually even note—

Hon Members: Name one!

Hon Dr NICK SMITH: —oh, name one—that Labour’s environment spokesperson says that Resource Management Act changes are important. So even Labour accepts that if we are serious about addressing housing affordability, Resource Management Act reform is an important part of the package.

Joanne Hayes: Have any changes been made to the Resource Management Act that have negatively impacted on land supply and housing affordability in Auckland; if so, when were those changes made?

Hon Dr NICK SMITH: At the heart of the Auckland housing issue is land supply and the rigid boundary imposed by the former Auckland Regional Council’s metropolitan urban limit. That has seen section prices in Auckland go up by 300 percent. District and city councils had to have regard only for the metropolitan limit under the original Resource Management Act, but changes made in 2004 meant that regional councils’ plans trumped local council rules. This change turned the metropolitan urban limit into a straitjacket, saw section availability drop dramatically, and saw undeveloped land prices inside the metropolitan urban limit increase, in some cases by a hundredfold.

Phil Twyford: Does he agree with John Armstrong in the New Zealand Herald that he was using the Resource Management Act as a smokescreen; if so, was he using housing to disguise his weakening of the Resource Management Act’s environmental principles or was he using the Resource Management Act to distract from his failure to fix the housing crisis?

Hon Dr NICK SMITH: The Productivity Commission produced a comprehensive report on housing affordability. It said that at the core of what this Parliament must address, if it is serious about making housing more affordable, is those planning rules within the Resource Management Act. I simply say to the member opposite that sections can be developed only through the Resource Management Act. Section prices are at the core of this issue, and, if we are serious about addressing that, reform of the Resource Management Act is critical.

Phil Twyford: Will he release the detail of his housing-related Resource Management Act changes so that parties on this side of the House can assess them, given Andrew Little’s commitment that we will look at supporting them if they stack up?

Hon Dr NICK SMITH: All in good time. The Government is going to consult with its support parties—the Māori Party, the ACT Party, and United Future. When we have a bill in good shape we will introduce it to the House, and we would welcome the support of members opposite. 01 Apr 2015 Oral Questions Page 8 of 14 (uncorrected transcript—subject to correction and further editing)

Superannuation—Government Initiatives 6. TODD MULLER (National—Bay of Plenty) to the Minister for Social Development: What is the Government doing to support people receiving superannuation in retirement?

Hon ANNE TOLLEY (Minister for Social Development): Today superannuation and veterans pension payments have increased by 2.07 percent as a result of the annual general adjustment. This increase will see married superannuitants receiving an extra $11.68 each week, while those living alone will receive an extra $7.59. This Government has committed to keeping the married couples superannuation rate to at least 66 percent of the average wage, and this increase is the result of rising wages in a growing economy. Since 2008 superannuation and veterans pension payments have increased by 31 percent, double the rate of inflation, allowing superannuitants to enjoy a better standard of living in their retirement.

Todd Muller: What impact does the annual general adjustment have on beneficiaries?

Hon ANNE TOLLEY: In 2011 this Government passed legislation to increase benefits annually in line with inflation. As a result, benefit payments to around 440,000 New Zealanders will also increase today by 0.51 percent. The thresholds for the community services card have also increased. This increase benefits thousands of New Zealanders receiving a range of assistance through Work and Income and StudyLink, and it ensures that benefits keep pace with increased living costs.

Regional Economies—Northland 7. Dr DAVID CLARK (Labour—Dunedin North) to the Minister for Economic Development: Does he agree with the Prime Minister when he says of the people of Northland: “They want more. They want to go faster”; if so, does he believe that this view on the economy is unique to the people of Northland?

Hon STEVEN JOYCE (Minister for Economic Development): This question is nearly identical to the member’s question No. 8 in the House yesterday. I have checked my Hansard and I am very happy with the answer yesterday, which applies today.

Mr SPEAKER: It would help if you would re-answer the question.

Hon STEVEN JOYCE: Repeat the answer? Well, what I said yesterday was that I do agree with the Prime Minister. In fact I told Q+A on the weekend that there is an impatience in Northland to do more and, frankly, I share that impatience. Although we have had some positive economic growth and employment growth in the Northland region in recent times, we recognise there is more to be done. That is why we are fast tracking critical infrastructure like regional roading projects, the roads of national significance, ultra-fast broadband, and Rural Broadband. That is why we are working with other parties to reform the Resource Management Act in order to cut red tape and encourage investment in the region.

Dr David Clark: Is the issue of lack of work unique to Northland, given that the household labour force survey shows that the number of people looking for work in every single region of New Zealand is higher than when the Government took office in 2008?

Hon STEVEN JOYCE: There are a couple of points here. One is that, again—as the member earlier this afternoon tried to ignore—there has been a thing called the global financial crisis, and in fact all over the—

Dr David Clark: It finished quite a few years ago, Steven.

Hon STEVEN JOYCE: Well, actually, it has not finished. It has not in Spain, it has not in Greece, it has not in Europe, it has not in Australia, it has not in the UK, it has not in the US, and it has not in Canada. I appreciate that the member wants to ignore it in the context of New Zealand, but New Zealand has one of the lower unemployment rates in the OECD, New Zealand employment is recovering well, and the New Zealand economy is now one of the fastest growing in the developed world.

Dr David Clark: Is the issue of squeezed income unique to Northland, given that the New Zealand Income Survey shows that real median household incomes have decreased in Auckland, 01 Apr 2015 Oral Questions Page 9 of 14 (uncorrected transcript—subject to correction and further editing) Waikato, Bay of Plenty, Gisborne, Hawke’s Bay, Manawatū, Wanganui, Tasman, Nelson, Marlborough, and the West Coast since his Government came to office?

Hon STEVEN JOYCE: I would have to go back and check the member’s numbers, but actually, again, the global financial crisis happened in this country. The good news is that when we arrived in office, unfortunately the previous Government had inflation growing faster than incomes. Now we have incomes growing faster than inflation, and I know which New Zealanders prefer.

Dr David Clark: Is the issue of poorly maintained roads unique to Northland, given New Zealand Transport Agency funding has decreased over the past 6 years, not only in Northland but also in Gisborne, Hawke’s Bay, Taranaki, Manawatū, Wanganui, Tasman, Nelson, Marlborough, and on the West Coast?

Hon STEVEN JOYCE: This is why the House has some difficulty, I am sure, believing the member because in that question he is completely wrong, as he is in others.

Dr David Clark: I seek leave to table the data that supports the assertions in my question.

Hon Steven Joyce: What is it?

Dr David Clark: It is off the New Zealand Transport Agency website, provided by the Parliamentary Library.

Mr SPEAKER: Order! If it is off the website it is available to all members. Does the Minister wish to complete an answer? Supplementary question, Dr David Clark.

Dr David Clark: Does he intend to do as much to confront the issues of lack of work, squeezed incomes, underfunding of local roads, and falling home affordability in other regions of New Zealand as he has done in Northland in the past 6 years, and does he expect similar results?

Hon STEVEN JOYCE: Again, I am sorry but the member is incorrect. He talks about falling home affordability, and that is obviously a challenge in Auckland, but, actually, in regional New Zealand that is not so much of a challenge. I know that the member takes a very broad-brush approach. There are unique problems in different regions, and Northland has some more intractable problems that have been difficult for politicians on both sides of the House for decades. We will continue to work on them, and will continue to apply the appropriate policy mixes to each region of the country. New Zealand as a whole will continue to grow strongly over the next few years, and that is predicted by the Reserve Bank and Treasury. We will continue to work on that growth.

Dr David Clark: I seek leave to table census data showing that homeownership has—

Mr SPEAKER: Order! The member will resume his seat. Again, census data is freely available—

Dr David Clark: It has been compiled by the Parliamentary Library for the purpose of illustrating the point over that time period for the Minister.

Mr SPEAKER: Order! On the basis that it is now information from the Parliamentary Library I will put the leave. Leave is sought to table that particular table prepared by the Parliamentary Library.

Hon Dr Nick Smith: I seek leave of the House—

Mr SPEAKER: Order! I just need to put this leave first. Leave is sought to table the information asked for by Dr David Clark. Is there any objection to that being tabled? There is not. It can be tabled.

Hon Dr Nick Smith: I seek leave of the House to table the AMP housing affordability survey issued yesterday, showing that housing affordability has improved in every single region—

Mr SPEAKER: Order! The document has been described. Is it a document that has been distributed to all MPs?

Hon Dr Nick Smith: No.

Mr SPEAKER: Is it publicly available on the website?

Hon Dr Nick Smith: Yes.

Mr SPEAKER: It is; then I will not put the leave.01 Apr 2015 Oral Questions Page 10 of 14 (uncorrected transcript—subject to correction and further editing)

Income Gap, Parity with Australia—Minimum Wage 8. DENISE ROCHE (Green) to the Minister for Workplace Relations and Safety: What is the size of the gap between the New Zealand minimum wage hourly rate and the Australian national minimum wage hourly rate?

Hon MICHAEL WOODHOUSE (Minister for Workplace Relations and Safety): I am pleased to advise that today the gap between the two countries has closed, thanks to the increase in the minimum wage, which will put $1,000 a year in the pockets of minimum-wage earners. An absolute measure of the gap between Australia and New Zealand is a little difficult, due to changes in the exchange rate and the fact that Australia has minimum rates for youth and the disabled. But if we take the adult minimum wage of both countries today, the gap is about $2.50. That compares with $4.16 in April 2008, after the last Labour-Green Government’s minimum-wage increase.

Denise Roche: Has his Government dropped its 2008 goal to achieve pay parity with Australia; if not, why has the average weekly earnings gap increased by $45.38 under National?

Hon MICHAEL WOODHOUSE: I would need to check the member’s data, because they are not the same as mine. The gap in both the adult minimum wage and the average and medium wages is closing, as we committed to. The member does not need to take my word for it. She can take the word of the tens of thousands of New Zealanders who realise the grass is actually greener on this side of the Ditch and they are coming home.

Denise Roche: I seek leave to table this document showing that the average weekly earnings gap between New Zealand and Australia, adjusted for—

Mr SPEAKER: Order! The source of the document is now all I require.

Denise Roche: It was put together for me by the Parliamentary Library.

Mr SPEAKER: We have started a pattern here that I might well regret. I will put the leave, and it will be over to the House. Leave is sought to table that Parliamentary Library document. Is there any objection? No.

Denise Roche: How much would the average earnings gap between Australia and New Zealand reduce if his Government simply paid the same minimum wage as Australia?

Hon MICHAEL WOODHOUSE: I do not have that data to hand, because the primary question was actually about the minimum wage, but what I can tell the member is that if the minimum wage moved to the adult Australian minimum wage, the cost would be 15,000 jobs—15,000 jobs. This Government is not prepared to throw people on the scrap heap just for a whim.

Denise Roche: Would he agree that if New Zealand’s economy relies on paying 300,000 people wages so low that they are trapped below the poverty line, it is not really an economy that is working for all of us?

Hon MICHAEL WOODHOUSE: I would agree with the member that the goal is to create an economy that means that all employees are paid appropriately for their skills and experience, and I also note that under this Government the adult minimum wage has gone up by more than $110 a week. That is $5,700 a year. But you cannot get higher wages with the stroke of a pen. Otherwise you would be putting the minimum wage up to $30, $40, $50 an hour.

Parents, First-time—Support 9. Dr PARMJEET PARMAR (National) to the Minister for Workplace Relations and Safety: How is the Government helping to support new parents?

Hon MICHAEL WOODHOUSE (Minister for Workplace Relations and Safety): As part of Budget 2014’s $500 million investment in the well-being of New Zealand’s children and families, we announced that the Government would improve paid parental leave to help young families get ahead. This is happening in two steps, and the first came into effect today, with paid parental leave increasing from 14 to 16 weeks. From 1 April next year, this will be increased by a further 2 weeks, to a total of 18 weeks’ paid leave. This Government wants to support families in making the choices that are best for them, so we have increased the parental tax credit, which has not been raised since 01 Apr 2015 Oral Questions Page 11 of 14 (uncorrected transcript—subject to correction and further editing) 1999. The tax credit is paid when low and middle-income working families who are not on a benefit and who do not receive paid parental leave have a new child. From today that parental tax credit increases from $150 a week to $220, and the payment period has been extended from 8 weeks to 10 weeks.

Dr Parmjeet Parmar: What other changes are in the pipeline with paid parental leave?

Hon MICHAEL WOODHOUSE: I will be introducing legislation to the House this year that will extend paid parental leave eligibility to more workers and increase the flexibility of the scheme. These changes will include extending parental leave payments to non-standard workers such as casual staff and those who have recently changed jobs; extending entitlements to primary carers other than biological parents, such as permanent guardians, Home for Life carers, whāngai, and grandparents; and enabling employees to take their leave more flexibly by mutual agreement with the employer. Each year more than 26,000 people take paid parental leave. Our changes will make it easier for thousands of New Zealand parents to take more time off work to spend with their newborn child if they wish, and will provide extra support for young families at an important and challenging time.

Sue Moroney: Why did National vote against funding 26 weeks’ paid parental leave for babies born with a disability, those born prematurely, or to the parents of multiple births, at a cost of just $6 million, when only 3 weeks later the Government found $70 million to fund the Northland bridges election bribe?

Hon MICHAEL WOODHOUSE: There is already a great deal of assistance for parents of multiple-birth children. The Government currently provides payments for home help to assist with multiple births, Working for Families tax credits provide four types of payments for families with dependent children, and there is a whole range of extra financial support for families in special circumstances, such as accommodation, childcare, and other grants. For families with a new baby with a disability there is a child disability allowance to help parents meet the additional costs, and a whole range of initiatives from disability support services that provide wraparound services for these families.

Corrections, Department—Staff Safety 10. MAHESH BINDRA (NZ First) to the Minister of Corrections: Is he satisfied that staff-to-prisoner ratios are adequate for staff safety in all of New Zealand’s corrections facilities?

Hon Peseta SAM LOTU-IIGA (Minister of Corrections): Yes, I am.

Mahesh Bindra: Given that there is no specific ratio model for staffing at the privately run prisons, and given the recent death of a prisoner in custody—with condolences to the family—what mechanisms are in place in all of New Zealand’s corrections facilities, both public and privately run, to keep staff and prisoners safe from prison assaults?

Hon Peseta SAM LOTU-IIGA: As the member knows, staffing levels for residential units and operational support functions at each publicly managed prison were set in 2001. Those ratios looked at the staff-to-prisoner ratios for remand prisons, which were set at 1:15; for high to medium prisons at 1:15; and as well for youth prisons at 1:9.

Tracey Martin: What about Serco?

Hon Peseta SAM LOTU-IIGA: For Serco—I am getting to that, ma’am—it is based on the output and the outcomes that Serco is able to do. In the last prison performance table, might I just add, Serco’s Mt Eden Corrections Facility was the most exceptional prison based on core security, internal procedures, and its rehabilitation score. So it is clear that despite the fact that we have that private prison, it is one of the highest-performing prisons in New Zealand.

Kelvin Davis: So what is being done to reduce the numbers of assaults on both inmates and staff in correctional facilities?

Hon Peseta SAM LOTU-IIGA: As that member knows, prisons are extremely difficult and demanding work environments for our staff. Over the last few years the Government has introduced 01 Apr 2015 Oral Questions Page 12 of 14 (uncorrected transcript—subject to correction and further editing) stab-resistant body armour, spit hoods, batons, and pepper spray progressively from 2010. We have also rolled out extensive training on de-escalation techniques to all front-line officers. We have trialled on-body cameras, and a tender is now out for their roll-out. And we are implementing a pilot site emergency response team at Spring Hill prison, which was implemented today.

Kelvin Davis: What internal reviews have been or will be done in regards to the near fatal assault on an inmate in a Hawke’s Bay correctional facility on the weekend; the assault on prison guards at Rimutaka Prison on Monday; and the bashing of an inmate in Christchurch Prison, which yesterday proved fatal?

Hon Peseta SAM LOTU-IIGA: With regards to the last incident, it is sad that Mr Parata died in custody. There is an ongoing police investigation. The chief inspector will be following that up with his own investigation. Far be it from me to comment further on that matter.

Tax System Changes—Impact on Small and Medium Sized Enterprises 11. IAN McKELVIE (National—Rangitīkei) to the Minister for Small Business: How will small and medium businesses benefit from the Government’s proposals to simplify the tax system?

Hon CRAIG FOSS (Minister for Small Business): Small and medium sized businesses will benefit from a simpler and modernised tax system. The Government is considering possible improvements to simplify the tax system for businesses by streamlining the collection and calculation of PAYE, GST, and related information, by integrating these obligations into various business processes—things such as leveraging new technology and simplifying calculation for provisional tax based, perhaps, on real-time information. I encourage small and medium enterprises to make a submission on these very good proposals. These initiatives will make for a more modern, efficient, and flexible tax system, once again demonstrating why this Government is better for business.

Ian McKelvie: How are small and medium businesses benefiting from the changes the Government has made to the tax system?

Hon CRAIG FOSS: Small and medium businesses, whether in rural areas, in the city, on the farm, or in the factory, have already benefited from changes that this Government has made to the tax system, including lower company tax rates, lower personal income tax rates, and making tax compliance easier for businesses through initiatives such as my IR online accounts. Small and medium businesses are also benefiting from other changes by removing unnecessary reporting requirements, cutting red tape, and improving infrastructure.

Chris Hipkins: I raise a point of order, Mr Speaker. Over several days there have been questions from Government members to this Minister, which he has answered with a prepared short speech. Although there are no rules that prevent Ministers from reading answers, it does seem to be a waste of the House’s time to get short speeches to patsy questions.

Hon Gerry Brownlee: Small business is the heart of the New Zealand economy, and I am disgusted that the Labour Party members should say it is a waste of the House’s time to consider their interests. [Interruption]

Ron Mark: Point of order, Mr Speaker.

Mr SPEAKER: Order! I hope it is a fresh point of order from Ron Mark.

Ron Mark: Firstly, that was not a point of order, and I have been sat down on numerous occasions by you for making points of order that—

Mr SPEAKER: Can the member make his point of order quickly.

Ron Mark: OK. The point of order draws you specifically to Standing Order 383, in particular Standing Order 383(1) and (2), and questions are meant to be short. The point raised by the whip for Labour is very well made. You yourself and other Speakers in the Chair have said that we should not be giving speeches. If a person cannot give their answer orally, then they should be sat down.

Mr SPEAKER: Order! Is there a further point of order being raised by Chris Hipkins, or has he caused enough trouble?01 Apr 2015 Oral Questions Page 13 of 14 (uncorrected transcript—subject to correction and further editing)

Hon Gerry Brownlee: Point of order, Mr Speaker.

Mr SPEAKER: No, I do not need any more assistance from the member. Members should know that questions are allocated and the Government gets a share of those questions. Government members have every right to ask a question about how small and medium sized businesses will benefit by proposed tax changes. I did not think the list that was read out was unduly long. I am certainly aware that the Minister on many occasions is long with some of his answers. On this occasion, I did not think he was at all.

Ian McKelvie: This will be very good. [Interruption]

Mr SPEAKER: Order! Equally, all members have a right to ask a supplementary question.

Ian McKelvie: What reports has the Minister seen on proposed changes that will not simplify the tax system for small and medium businesses? [Interruption]

Mr SPEAKER: Order! On the basis that the answer does not comment on another political party’s policy, the Minister can answer the supplementary question.

Hon CRAIG FOSS: I have seen a report: “Overly burdensome tax compliance must be addressed. It is an avoidable drag on the productivity of our small businesses.” I absolutely agree with that statement, but I have also seen a report from the same author that proposes complex new taxes and burdens on small businesses. The author of those two reports cannot have it both ways. The author of those reports is the Labour Party. [Interruption]

Mr SPEAKER: Order! I am on my feet. I am going to take this opportunity to ask that Minister to look carefully at Speaker’s ruling 154/2. It is not reasonable to use a question from the governing party to simply attack other members of this House or other political parties. It is to cease from that Minister.

Defence Force—Deployment of Military Personnel to Iraq 12. Hon PHIL GOFF (Labour—Mt Roskill) to the Minister of Defence: Does he stand by his response yesterday “well, why would you?” when asked if he would publicly release details regarding the level of protection afforded to New Zealand personnel in the upcoming deployment to Iraq?

Hon GERRY BROWNLEE (Minister of Defence): In the context that the question was asked, yes.

Hon Phil Goff: When details about legal protection have not been suppressed in the past, is the lack of transparency in this case because, in fact, he has achieved less protection for our New Zealand soldiers in Iraq; if not, what is the reason?

Hon GERRY BROWNLEE: It is an unreasonable suggestion from the person asking the question that there has been less legal protection achieved for our people who will be deployed to Iraq, but I would go on to suggest to him that he look back at recent history—2001, 2003, 2006, and 2009—and note that such agreements were not released on those occasions. On at least one of those occasions, I believe, he was the Minister of Defence.

Hon Phil Goff: I seek leave from the House to table the status of forces agreement in regard to the Solomon Islands in 2003, and in fact the—

Mr SPEAKER: Order! The document has been described; it does not need further description. I will put the leave. Leave is sought to table that particular document. Is there any objection? There is none.

Hon Phil Goff: With regard to transparency, why did his office yesterday mislead journalists by telling them that New Zealand soldiers were not in Australia training for deployment, only to correct that later in the day after it was exposed by the Australian Broadcasting Corporation?

Hon GERRY BROWNLEE: The member is using his own interpretation of circumstances to create a picture that is simply untrue. I was asked about the issue at about a quarter to 10 yesterday morning, and I confirmed to them that there were troops training in Australia. The really ironic thing here is that the Labour Party thinks it is odd that our troops should train for a mission before 01 Apr 2015 Oral Questions Page 14 of 14 (uncorrected transcript—subject to correction and further editing) they go. I seek leave to table a document showing that it was the Solomon Islands Government that passed special legislation in 2003 that enabled the arrangement to be put in place that Mr Goff speaks of. It was not—

Mr SPEAKER: Order! [Interruption] Order! The document has been described. I will put the leave. Leave is—[Interruption] Order! Would both Mr Mark and Mr Brownlee continue their conversation after question time? [Interruption] Order! Leave is sought to table that document. Is there any objection? There is none.

Hon Phil Goff: Why has Mr Brownlee refused to be transparent when asked and tell this House what the level of risk is in the area that we are deploying New Zealand troops to, when the Australian Government, by comparison, has been open about the fact that it is high risk, and when the New Zealand Chief of Defence Force, Lieutenant General Keating, told the select committee that the place we are going to is an “extremely dangerous place”?

Hon GERRY BROWNLEE: Once again, the member asking the question puts together an assertion and suggests that it is fact. It is not. I have always maintained that we need to exercise a high degree of caution in the way in which we engage around this particular deployment, because it is risky. And anyone who watches their television on an evening will know that.

Hon Phil Goff: Why has the Minister repeatedly failed to be open, honest, and transparent around the questions of legal protection for our deployed troops, around risk levels for the Iraq deployment, and even about our soldiers training for deployment in Australia, when answering honestly any of those questions does not involve any security risk for our people?

Hon GERRY BROWNLEE: Well, Mr Speaker, I am actually quite surprised that you allowed that question, given the fact that—

Mr SPEAKER: I am giving plenty of licence to the answer.

Hon GERRY BROWNLEE: —it was full of all sorts of accusations manufactured in the mind of Phil Goff. I have always been open about the nature of this particular involvement, but I have said that there are particular concerns around this deployment that will mean that we do not say some things publicly. If the member cannot work it out, I would suggest he spends a little bit of time with some of the families who have got members who will be part of this deployment. Of course, for his own political reasons he does not care about that. He has got no interest in protecting those people. He has got an interest only in trying to get a little bit of public position that might put him back into contention against his old mate Andrew Little—

Mr SPEAKER: Order! [Interruption] Order! The general debate will start shortly.

Ron Mark: I seek leave of the House to table the United States status of forces agreement with Iraq, which is available on the internet.

Mr SPEAKER: If it is available on the internet, I will not be putting the leave.


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