Questions and Answers – July 23

by Desk Editor on Thursday, July 23, 2015 — 4:55 PM

Questions to Ministers

Mt Eden Corrections Facility—Performance-related Fees

1. DAVID CLENDON (Green) to the Minister of Corrections : What specific events has he been made aware of at the SERCO-run Mt Eden Corrections Facility that could trigger a specific deduction from the performance-related fee, and which of those events have resulted in a specific deduction?

Hon Peseta SAM LOTU-IIGA (Minister of Corrections): Some of the incidents include insufficient staffing levels, mixing accused prisoners with other prisoners, minimal entitlements, and incident notification. In the financial year 2014-15, these deductions amounted to $300,000.

David Clendon : Given that there have been deductions, why did the Minister only very recently praise Serco as “performing exceptionally”?

Hon Peseta SAM LOTU-IIGA : I said that statement with regard to the performance tables for prisons, where they have been given an “exceptional” performance rating.

David Clendon : At the Minister’s meeting with Serco today, did they advise him of any additional incidents at Mt Eden Corrections Facility that may result in a deduction?

Hon Peseta SAM LOTU-IIGA : No.

David Clendon : Given that the Department of Corrections produced a report on fight club incidents over a year ago and given that the department reported on a dropping incident earlier this year yet the Minister knew nothing about it until last week, will he concede that there is a dysfunctional relationship between him and his department?

Hon Peseta SAM LOTU-IIGA : No, I do not believe that there is a dysfunctional relationship, but what I can say is that I expressed my disappointment to the department for not elevating that to the chief executive and me.

Mahesh Bindra : Now that he is caught between his own career and Serco’s survival, which will he choose?

Hon Gerry Brownlee : No, that’s not a reasonable question.

Mr SPEAKER : Order! I am going to listen to the question again, please.

Mahesh Bindra : Now that he is caught between his own career and Serco’s survival, which will he choose?

Mr SPEAKER : No, I consider that that question has ministerial responsibility.

Hon Peseta SAM LOTU-IIGA : Well, I believe in my own career, thank you very much.

David Clendon : Does the Minister stand by his statement that Mt Eden Corrections Facility is “performing exceptionally” under Serco’s management; if so, why?

Hon Peseta SAM LOTU-IIGA : That performance table was in respect of the year ending 31 March 2015. However, I did say to Serco in our meeting this morning that there was room for improvement and that it needed to improve its performance, based on some of the evidence and incidents that we have seen in recent days.

David Clendon : Will the Minister now guarantee that Serco’s contract for the management of Mt Eden Corrections Facility will be renewed?

Hon Peseta SAM LOTU-IIGA : I cannot guarantee that that will happen. What I can say is that we will get the findings of the review, in terms of the incidents that were reported, and going forward we will make decisions that will be based on its performance.

David Clendon : Why is Serco only on notice and not facing immediate cancellation of its contract following the death of a prisoner, a prison riot, video evidence of fight clubs, evidence of the manufacture of alcohol and tobacco; or do they actually need to burn Mt Eden Corrections Facility down before the Minister will—

Mr SPEAKER : Order!

Hon Peseta SAM LOTU-IIGA : Well, unlike the Green Party, we believe that there is a process to follow—due process. There needs to be a review, we need to get to the bottom of the facts around some of the incidents that we have seen in recent days, and then we will make the appropriate decisions.

Dairy Price—Reports

2. KANWALJIT SINGH BAKSHI (National) to the Minister of Finance : What reports has he received on dairy prices and their effect on the New Zealand economy?

Hon BILL ENGLISH (Minister of Finance): Members will have seen the results of the recent dairy auction: international dairy prices are now around 40 percent lower than the recent peak in early March, and there are indications they could fall further. For the dairy sector, of course times are turning out tougher, and perhaps for longer than industry experts were forecasting and more than the Government was forecasting earlier this year. The dairy sector makes up 5 to 6 percent of the economy, taking into account associated service industries, so obviously a fall in prices of this magnitude on a sector that makes up around 20 percent of exports is going to have a flow-on effect on economic growth.

Kanwaljit Singh Bakshi : How is the fall in dairy prices impacting on other sectors of the economy?

Hon BILL ENGLISH : As I mentioned, lower dairy prices will obviously impact on businesses with links to the dairy sector. It is somewhat mitigated by the fact that dairy farmers still have to spend a certain amount of money to achieve their output. Unfortunately, some of that spend in the next 12 months will be financed by debt rather than by revenue. Offsetting this somewhat is the recent fall in the exchange rate. The exchange rate is down around 25 percent against the US dollar compared with this time last year. That, of course, will support all exporters by softening the impact of lower prices on the dairy industry but underwriting more profitability for other export sectors like meat and wool, horticulture, information and communications technology, and tourism—all of which are doing well and whose competitiveness has been strengthened by the lower dollar. An important continued part of the success of the export industry are our free-trade agreements, with Taiwan, for instance, and we expect significant benefits from the free-trade agreement with Korea, which we hope to have in place this year.

Kanwaljit Singh Bakshi : How does the resilience of the New Zealand economy compare with when the Government first came into office in 2008?

Hon BILL ENGLISH : Of course, New Zealand is always going to be subject to international pressures because we are a small, open economy. However, we have become a fairly resilient one. Alongside the automatic adjustments of flat to lower interest rates, and the lower exchange rate that I mentioned earlier, New Zealanders have been strengthening New Zealand’s balance sheet. The household savings rate is now positive consistently for the first time in 25 years, offshore debt has reduced by 20 percent of GDP since 2009, the net international investment position has improved from minus 85 percent of GDP to minus 64 percent of GDP, the current account continues to outperform forecasts—currently sitting at 3.6 percent of GDP—and of course the Government is heading towards surplus and the beginning of paying off its own debt.

Ron Mark : If the Minister believes what he has just told the House—that auction prices are down 40 percent and that they could fall lower, and those prices could remain low for considerably longer—

Mr SPEAKER : Can I have the question, please.

Ron Mark : —why does he believe that it is economically sensible for his Government to block dairy exports to the world’s second-largest dairy importer, that being Russia, when our rural and provincial communities are in such dire straits, or are they expected—

Mr SPEAKER : Order!

Hon BILL ENGLISH : It is not absolutely clear that a change in the situation in Russia would make a material difference to the current dairy prices, but ongoing discussion with a range of nations trying to deal with the challenging behaviour from the Russian leadership will continue when there is an opportunity for dairy exports to resume there, and I am sure that opportunity will be taken.

Kanwaljit Singh Bakshi : How does the forecast of New Zealand’s expected economic growth compare with the growth in previous years?

Hon BILL ENGLISH : New Zealand’s economic growth over the last 4 years averaged 2.6 percent per year. The Reserve Bank said today that the growth outlook is now softer than it expected in its last forecast 6 weeks ago, but I would note that those last forecasts included a substantial reduction in dairy prices but still projected a growth of around 3 percent for the next couple of years. I expect the Reserve Bank will update its forecasts in another 6 weeks’ time. So although expectations of growth may be coming back a bit from recent forecasts, low interest rates, higher construction activity, and high net immigration indicate that we are on track for solid, moderate, and sustainable growth for New Zealanders, which will underpin more jobs and higher incomes.

Health Personnel—Resourcing

3. Hon ANNETTE KING (Deputy Leader—Labour) to the Minister of Health : Is he confident that the Government is adequately resourcing the public health workforce?

Hon Dr JONATHAN COLEMAN (Minister of Health): Yes. New Zealand’s public health budget will reach a record $15.9 billion in the coming year—an increase of over $4 billion since 2008-09. Under this Government, this additional investment has allowed us to grow our front-line public health workforce. The latest information available confirms that there are 7,648 doctors and 22,092 nurse full-time equivalents employed by district health boards. That is 1,718 more doctors and 3,768 more nurses compared with 2008.

Hon Annette King : If there is sufficient funding, why have doctors at North Shore Hospital this week warned of a mismatch between staffing levels and patient workload, which is putting patients’ safety at risk?

Hon Dr JONATHAN COLEMAN : Well, North Shore Hospital is in the Waitematā District Health Board. It is the fastest-growing district health board in New Zealand, in terms of population. There is an increasing workload there, but I have got every confidence in the senior clinicians and the chair, Lester Levy, that they are up to the task of matching resources to the demands. At North Shore Hospital—I can tell you, it is the hospital that my local electorate goes to—people who go there are very, very happy with the service because, actually, they are not waiting under fluorescent lights for 24 hours, like they were back in 2008.

Hon Annette King : If resources are keeping up, why did the North Shore Hospital doctors this week warn that the work environment is dangerous to staff and patients, and patients—listen to this, Minister—have been left unseen for long periods with only cursory medical attention, 10 years on from when I was—

Mr SPEAKER : Order! That’s enough of that question.

Hon Dr JONATHAN COLEMAN : I can tell you a story about going to North Shore Hospital with Tony Ryall in 2008 and meeting a young man with a broken leg who had been waiting in the foyer for over 24 hours. Now, that just does not happen anymore. And as for anything that that member says, she wants to check her own record, I think, because, you know, you would have to see how it is now.

Hon Annette King : I seek leave to table, for the Minister, the Resident Doctors Association newsletter dated this week—

Mr SPEAKER : Order! The document has been described. I just need to ascertain from the member how easy it is—

Hon Annette King : It is an internal document.

Mr SPEAKER : On that basis, I will put the leave. Leave is sought to table that particular internal document. Is there any objection? There is none. It can be tabled. Document, by leave, laid on the Table of the House.

Hon Annette King : If the medical workforce in our hospitals is sufficient, why did “an overwhelming 81.3 percent” of GPs responding to the latest New Zealand doctor poll say that they face problems in getting first specialist assessments for their patients in public hospitals, up on the same poll taken in 2006?

Hon Dr JONATHAN COLEMAN : What I can say is that we are providing 50,000 more first specialist assessments per year. So I think, when you delve into those facts, it is actually easier than ever to get a first specialist assessment. I would be very interested to see what the question actually was.

Barbara Stewart : What plans does he have to prepare for the future shortage of dental therapists in New Zealand, particularly as over 70 percent are now aged 45 and over and an increasing number of dental graduates are being employed by private dental practices?

Hon Dr JONATHAN COLEMAN : We could recycle Mrs King but I do not think that is going to happen. Apart from that, if you go to the Ministry of Health’s website, you will see all the Health Workforce New Zealand plans there. It is all laid out very carefully, so go and have a look.

Hon Annette King : In light of his answer to my last supplementary question, if there is a sufficient medical workforce in New Zealand, why did the number of people being sent back to their GP having been refused a first specialist assessment increase by a whopping 38 percent at the Waitematā District Health Board—his own district health board—in 2014-15?

Hon Dr JONATHAN COLEMAN : Well, we know that that is not actually correct, because that data has never been collected. But what we do know is that under that Government, when Labour was there, it kicked 30,000 people off surgical waiting lists. That is the only fact in this conversation.

Hon Annette King : I seek leave to table an Official Information Act request to the Waitematā District Health Board, pointing out the 38 percent—

Mr SPEAKER : Order! I just need the date of it.

Hon Annette King : The date of it is 21 July 2015.

Mr SPEAKER : I will put the leave. Leave is sought to table that particular Official Information Act request. Is there any objection? There is none. It can be tabled. Document, by leave, laid on the Table of the House.

Hon Annette King : What was his response when he was informed by the Ministry of Health just over 2 months ago that five large district health boards are blowing out their staff budget because of demand and the high cost of covering medical vacancies due to the lack of a trained workforce?

Hon Dr JONATHAN COLEMAN : That is just not correct. There is a trained workforce there. We have got over 5,000 new doctors and nurses compared with 8 years ago, and our hospitals are well staffed. In addition, we have put an extra $1.7 million into the budget, which will come into effect over the next 4 years. So I just do not agree with what you are saying, Mrs King. Sorry.

Greenhouse Gas Emissions—Carbon Reduction Targets

4. GARETH HUGHES (Green) to the Minister for Climate Change Issues : Given criticisms that the carbon target he set is inadequate, will he set a more ambitious target ahead of the Paris climate negotiations in December?

Hon Dr NICK SMITH (Minister for the Environment) on behalf of the Minister for Climate Change Issues : The New Zealand target of a 30 percent reduction on 2005 emissions is ambitious and it is consistent with this Government’s policy of New Zealand doing its fair share. It is comparable with targets from similar countries like the US, Japan, and Canada, despite the unique challenges that New Zealand has, with 50 percent of its emissions coming from agriculture and 80 percent of electricity being renewable. We know from the experience of the last Government that setting wildly ambitious targets like carbon neutrality and then having net emissions go up by 25 percent do absolutely nothing for New Zealand’s credibility on this important international issue.

Gareth Hughes : Well, in light of that answer, is he aware that only Russia, South Africa, South Korea, and Ukraine have more inadequate targets than New Zealand, according to analysis undertaken by four reputable European research organisations?

Hon Dr NICK SMITH : No, I do not agree with that analysis at all, and, actually, there are key elements of that analysis that actually disagree with Green Party policy. If I look at the target for Japan, it is minus 25 percent, which compares with our minus 30 percent off the 2005 baselines. If I look at the figure for the United States, they have said 26 to 28 percent; which compares very well with our minus 30 percent. It will be interesting to see what other countries like Australia that face similar challenges to New Zealand do when they announce their targets prior to Paris. New Zealand’s position is very credible.

Gareth Hughes : So does he disagree with renowned climate scientist Professor James Renwick, who said recently “If all countries followed New Zealand’s lead, we would be in for very significant climate change impacts and catastrophic damage to the New Zealand and global economy.”; if not, why will he not consider setting a more ambitious target?

Mr SPEAKER : Either of those two supplementary questions, the Hon Dr Nick Smith.

Hon Dr NICK SMITH : A minus 30 percent target on 2005 emissions is ambitious. Perhaps the Government might have been able to set a more ambitious target if during the period of the previous Government, supported by the Greens, emissions had not gone up by a net 25 percent.

Gareth Hughes : So does the Minister think that he can negotiate with the science of climate change; if not, which countries does he expect to pick up the slack if we are, as a globe, to avoid catastrophic climate change?

Hon Dr NICK SMITH : I can simply repeat that we think this target is ambitious. It is going to require New Zealand to do a lot more over the next 15 years than what both the previous Government and the Government prior to that have done. In respect of the negotiations, I think every member of this House should be proud of the level of contribution that Tim Groser is making to the process. He has been more influential than any other climate change Minister since this issue first developed in the 1990s.

Economy—Tech Start-Ups

5. PAUL FOSTER-BELL (National) to the Minister of Science and Innovation : How is the Government seeding more high-tech start-ups in the New Zealand economy?

Hon STEVEN JOYCE (Minister of Science and Innovation): Yesterday I published the results of the first year of the new Technology Incubator Programme, funded through Callaghan Innovation. So far, the programme has approved funding of $7.8 million to support 18 high-tech companies through the repayable loans scheme, each receiving funding of up to $450,000 over 2 years. Those companies are involved in commercialising technologies in the information and communications technology, sensing and automation, food and beverage technology, advanced materials, design and manufacturing, and bio-tech industries. The programme is just one part of a wide suite of initiatives that are helping to further diversify the economy through growing smart new Kiwi companies.

Paul Foster-Bell : How does the Technology Incubator Programme support the growth of these high-tech start-ups?

Hon STEVEN JOYCE : Technology-focused incubators promote businesses that concentrate on commercialising complex intellectual property, sourced primarily from research organisations such as universities, Crown research institutes, and private institutes. They are modelled on the successful Israeli incubator system. The incubators include Powerhouse Ventures, Astrolab, and WNT Ventures. Budget 2013 allocated the programme $31.3 million in new funding over 4 years for the repayable grants. That Government funding is matched 1:3 by incubator owners. The grants will be repayable out of each company’s revenue.

Paul Foster-Bell : How many other Kiwi companies are being supported to innovate, invest, and grow their exports?

Hon STEVEN JOYCE : Almost too many to name. For example, through New Zealand Trade and Enterprise’s Focus 700, we are working closely with 621 companies, which will rise to 700 in a year’s time. Since 2011 New Zealand Trade and Enterprise has helped 9,514 companies through the regional business partner network. With Callaghan Innovation, our high-tech HQ for New Zealand businesses, we have supported more than 150 companies with research and development growth grants, and around 750 companies with research and development project grants. Through incubator programmes, we are supporting 115 new companies, and, of course, the New Zealand Venture Investment Fund contributes to 187 companies, including 131 as part of the Seed Co-investment Fund. When it comes to encouraging New Zealand companies and to diversifying the economy, this is a Government of action; not one of hackneyed student political rhetoric.

Reserve Bank Governor—Statements

6. GRANT ROBERTSON (Labour—Wellington Central) to the Minister of Finance : Does he agree with the Reserve Bank Governor’s statement that “the growth outlook is now softer than at the time of the June Statement. Rebuild activity in Canterbury appears to have peaked, and the world price for New Zealand’s dairy exports has fallen sharply”?

Hon BILL ENGLISH (Minister of Finance): Generally, although not with exactly every word that the Reserve Bank Governor says. But I also agree with what the governor said when he said that the economy is currently growing at an annual rate of around 2.5 percent, which is stronger than the OECD average of 2 percent. Although expectations of growth may be coming back a bit from recent forecasts, we are on track for moderate sustainable growth, as the Government has been saying pretty much all year.

Grant Robertson : Is Westpac’s analysis correct that the Canterbury rebuild has already peaked and will not add materially to economic growth over the remainder of this year or the next, and from 2017 will reduce economic growth by almost two-thirds of a percent?

Hon BILL ENGLISH : I have not seen any of the detail of that analysis. There have been a lot of forecasts that the Christchurch activity has peaked, and it just keeps on peaking. So, for instance, while the residential rebuild is well through, the public sector rebuild, which is quite substantial, is only about 10 or 15 percent complete and there are still billions of dollars to spend. I think we have yet to see whether Christchurch activity has peaked.

Grant Robertson : Is ANZ senior economist Sharon Zollner correct when she says: “Commodity woes are far from specific to dairy. It is a sea of red across the entire commodity complex.”?

Hon Steven Joyce : No, she’s wrong, actually.

Hon BILL ENGLISH : To quote my colleague, she may well be wrong on that one.

Grant Robertson : Everyone’s wrong.

Hon BILL ENGLISH : Well, the member likes to quote bank economists when he thinks they are negative, and he will not quote them when he thinks they are positive. Actually, in respect of prices for exports, some export prices are down and some are certainly up.

Grant Robertson : Does he agree with the chief executive of the Real Estate Institute of New Zealand, Colleen Milne, that house prices in Auckland will continue to rise after today’s rate cut, and with predictions that the median Auckland house price will break the $1 million mark before the end of next year?

Hon BILL ENGLISH : All I can say is you do not have to be a real estate agent or even the Opposition spokesman on finance to predict that Auckland house prices might rise.

Grant Robertson : Is it not the case that with the Canterbury rebuild peaking and commodity prices across the board tumbling, the only thing left in his master plan for the economy is the Auckland housing bubble—that is it?

Hon BILL ENGLISH : No, and just to orientate the member, as the Reserve Bank has said today, the outlook is a bit softer but the economy is expected to grow between 2 and 3 percent over the next 12 months. That might not suit the member. It might be easier for him to talk the economy down than try to understand what is happening. But that is what New Zealanders are doing each day. They are out there investing another dollar, there is job growth, there is income growth, and there is innovation. This economy has good prospects.

Grant Robertson : Is his new plan for the economy the further sale of State assets, given that he told the competition and regulation conference today that “State assets are relics of a bygone era.”?

Hon BILL ENGLISH : There is no change in the Government policy about the sale of State assets, but—

Grant Robertson : Why did you say it, then?

Hon BILL ENGLISH : Well, if the member wants to talk about where the economy is headed and he does not know that the post office is losing the competition with the internet, then the Labour Party is in very serious trouble.

Grant Robertson : Can he confirm to the House that today at the competition and regulation conference he described State assets, as a class of assets, as relicts of a bygone era?

Hon BILL ENGLISH : Well, if the member thinks that—[Interruption] I can confirm that I made a statement like that with reference to companies like New Zealand Post. I mean, if the member thinks that the postal service is the cutting edge of innovation and growth in the New Zealand economy, that is like thinking the Labour Party is the cutting edge of politics in the New Zealand economy.

Education, Regional—Reports

7. MARK MITCHELL (National—Rodney) to the Minister of Education : What reports has she received on education in regional New Zealand?

Hon HEKIA PARATA (Minister of Education): Tēnā koe, Mr Speaker. I am absolutely pleased to have released today our annual Public Achievement Information, which gives students, parents, teachers and principals, and their communities a picture of what is happening in their regions and nationally. The information shows, among other things, that primary school achievement in writing and mathematics has increased in 15 of the 16 regions since 2011, that achievement in reading is up in 13 of the regions, and that early childhood education participation has increased in 14 of the 16 regions. I am particularly pleased, and I am sure the entire House will be, by the progress in areas such as the West Coast, Gisborne, and Northland, where the percentage of 18-year-olds with National Certificate of Educational Achievement level 2 or an equivalent qualification has risen by between 11.7 and 18.4 percentage points.

Mark Mitchell : How does this report help young New Zealanders achieve educational success?

Hon HEKIA PARATA : Under this National Government, student achievement continues to rise. However, we can always do better, and we strive to ensure that all our students are given the best opportunity to do so. Public information about education system performance is vital for students, their teachers and principals, iwi, parents, and employers. It helps families and communities understand how their children’s schools are performing, it helps teachers provide the right support to the kids who need it the most, and it assists schools, employers, and training providers to work out what skills are needed to boost local economic performance. May I commend to the House this fabulous at-a-glance chart of how well New Zealand’s education system is doing. It is not usual that I bring charts to the House, but this one, unlike others, is very meaningful. Kia ora.

Auckland Housing Market—Supply

8. PHIL TWYFORD (Labour—Te Atatū) to the Minister for Building and Housing : How does he intend to reduce the shortfall of Auckland houses in the next 2 years, given that under this Government the shortfall is increasing by 5,000 a year, and the Productivity Commission predicts on current rates the shortfall—now 32,000—will hit 60,000 by 2020?

Hon Dr NICK SMITH (Minister for Building and Housing): We have lifted the house build rate in Auckland for the last 4 years by 20 percent or more every year, and that is the largest and longest sustained period of building rate increase in Auckland’s history. We have achieved this by freeing up land and breaking the metropolitan urban limit; speeding up consenting; record numbers of new apprenticeships; and a wide range of reforms on building materials, on infrastructure, and on regulatory changes and Government initiatives in places like Weymouth, Hobsonville, and Tāmaki. I do not accept the member’s interpretation of the Productivity Commission. I would also draw his attention to the Construction Pipeline report that I will be releasing next week, which shows very different figures to those that he is quoting.

Phil Twyford : Why did he tell the media that he had consulted with Auckland iwi about his plan to develop vacant land, when official documents now confirm that he did not consult with Tainui or Ngāti Whātua before his announcement?

Hon Dr NICK SMITH : The first right of refusal in Auckland is with the Tāmaki Collective, not with Ngāti Whātua, so the clear legal advice the Crown received was that the consultation should be with those who have an interest.

Phil Twyford : What about Tainui?

Hon Dr NICK SMITH : In respect of the member’s interjection with regard to Tainui, there is only a very small area of Auckland in which Tainui has a first right of refusal. The Government has not identified any sites in that Tainui area where there are suitable housing developments. If we do identify suitable sites in that area, we certainly will be consulting with Waikato-Tainui.

Phil Twyford : Why will he not adopt the Australian policy of allowing non-resident foreign investors to only build new properties off the plan, which a cross-party committee of the Australian Parliament recently reported was helping to reduce house prices?

Hon Dr NICK SMITH : I note reports in the Sydney Morning Herald today that house prices in Sydney have gone up even faster than in Auckland. That is why this member’s attack on people with Chinese-sounding names and overseas persons, as though they are the problem, is incorrect. The problem is a lack of supply, and that is why the Government is putting its primary efforts into growing supply.

Phil Twyford : Which is the correct version of the Government’s position on a register of foreign property ownership: his statement that the Government would release information showing how many non-residents have bought property and which jurisdiction that they come from, within 3 months; or, that of the Minister for Land Information, Louise Upston, who told the New Zealand Herald that there would not be a foreign buyer register and no decision had been taken about whether it would be publicly released?

Hon Dr NICK SMITH : I can assure the member that the data provided by the Government will be a lot more accurate than the dodgy Chinese-targeted attack that he made on one group of ethnic New Zealanders, which most members of this House found abhorrent. In respect of the data that will be collected with the bill that the Government announced, the details of that are in the legislation. It is not a foreign buyer register; it is a tax record for non-resident taxpayers. That information will be released when it is collected more accurately from 1 October.

Joanne Hayes : Does the Minister think that the Auckland housing problem is caused by people with Chinese-sounding surnames; if not, why not?

Hon Dr NICK SMITH : No, it is not the Kiwi way to target one ethnic group, let alone to judge people on the basis of their surnames. It would be as unfair to ask what is little about Mr Little, or whether Mr Twyford is a twit.

Mr SPEAKER : Order! That is not—[Interruption] Order!

Phil Twyford : Does he believe it is “blaming the foreigner” for Beijing, Shanghai, Singapore, Malaysia, and Hong Kong to have restrictions on non-resident property ownership to prevent investment from China overheating their housing markets; if not, given that estimates $16 billion of investment from China is heading towards—

Mr SPEAKER : Order! [Interruption] Order! There is too much in that question. The first part can be addressed.

Hon Dr NICK SMITH : I have not noted the Governments or political parties in China, Malaysia, or Indonesia collecting lists of people with Kiwi-sounding names and targeting us with their housing problems. I note that in Australia, where they have some restrictions, they have not worked. I notice that in countries similar to New Zealand, like the UK, the US, and Japan, there are no such limits. If we are going to put any rules in place, we are going to do so on the basis of sound information, not on the sort of dodgy ethnically targeted information that the Labour Party now does for political opportunism.

Joanne Hayes : What changes has this Government made that reduce the attraction of residential property investment and address the demand side of housing in Auckland?

Hon Dr NICK SMITH : There have been five significant changes made by this Government in that respect. The first is that we removed the power to be able to claim depreciation on buildings, a measure that cost building owners over a billion dollars. The second change is the brightline test that was announced in the Budget, and the requirement to provide tax numbers and, if non-resident, an overseas tax number. The third change is the announcement of a non-resident withholding tax. A fourth change is the new Reserve Bank loan-to-value ratio limits, which will mean from 1 October that those in property investment will have to have a minimum 30 percent deposit. I would also note that the changes made by the Government requiring insulation on older properties has a direct cost impact on those who invest in properties. All five of these measures do have a cost impact and a cooling effect on investment property.

Phil Twyford : Does he accept the advice of the Dominion Post, which said that his handling of the housing policy has been a mess, that it is more of an attempt to look busy than to solve the problem, that it is too hands-off, and too small in scope?

Hon Dr NICK SMITH : I would love to read to the House the commentary on the botched attack on Chinese-sounding New Zealand names by over a dozen media, and, not only that, the criticism from members of his own party who are embarrassed by the way that he has trashed the name of the Labour Party, which historically has stood for a diverse New Zealand.

Beneficiaries—Higher Education

MATT DOOCEY (National—Waimakariri): My question—[Interruption]

Mr SPEAKER : Order! [Interruption] Order! The member Matt Doocey has been called. He deserves a chance to be heard with his question.

9. MATT DOOCEY (National—Waimakariri) to the Minister for Social Development : What is the Government doing to support people off benefits and into higher education?

Hon ANNE TOLLEY (Minister for Social Development): On 1 July the accommodation benefit rose to match the accommodation supplement for sole parents, so that sole parents who take up full-time study are now eligible to receive the same rate of accommodation support as they would on a main benefit, and could be up to $165 a week better off. These parents are at the highest risk of long-term welfare dependency, and there is good evidence that this risk reduces substantially when sole parents have educational qualifications. The new rate will apply once students apply for their next period of study, which is usually the next academic year.

Matt Doocey : What feedback has she received on this policy?

Hon ANNE TOLLEY : I was delighted to see that the New Zealand University Students’ Association president, Rory McCourt—he used to be a Young Nat before he went to the dark side—issued a press release welcoming the policy. He says the changes will “dramatically” improve the lives of solo parents in study. Of the changes, he said: “Being a student and a parent at the same time is one of the hardest double acts someone can do. Students have to live on less than the benefit, which adds unwanted financial stress to parents juggling coursework and raising a family. This increase is a recognition that we need to back students who are parents, and we welcome it.” And we agree.

Matt Doocey : What else is the Government doing to support parents off benefits?

Hon ANNE TOLLEY : The number of sole parent support clients on benefits has reduced to 69,240, down 1.6 percent for this last quarter. We now have the lowest number of sole parents on benefits since 1988. Our welfare reforms have significantly reduced the number of people on sole parent support by almost 5,000 in the last year. To achieve that, we have invested millions into intensive support and training, as well as help with study and childcare for those sole parents, so that working while raising children alone is achievable and rewarding. Of course, Budget 2015 will see an extra $25 a week for all those families receiving a benefit.

Corrections Facilities—Prisoner Safety

10. KELVIN DAVIS (Labour—Te Tai Tokerau) to the Minister of Corrections : Why did he state that he only learned about the practice of dropping this week, when he was directly told about it one month ago at select committee?

Hon Peseta SAM LOTU-IIGA (Minister of Corrections): I made that statement because it is true.

Kelvin Davis : Why has he, the Department of Corrections, and Serco continued to insist that dropping does not happen, despite media reports in February of an inmate being thrown two floors from a balcony at Mt Eden Corrections Facility?

Hon Peseta SAM LOTU-IIGA : With regards to this incident in February, the chief executive of the Department of Corrections has released a statement that concludes that there was no suggestion made in the report of any practice of dropping.

Kelvin Davis : What does—[Interruption]

Mr SPEAKER : Order! The interjections from both sides must cease to allow Kelvin Davis to ask his supplementary question.

Kelvin Davis : What does the closed-circuit television footage show of the dropping that took place in February and was referred to in a Department of Corrections news release today?

Hon Peseta SAM LOTU-IIGA : I have not seen the closed-circuit television coverage of that, but the investigation is quite clear, as I have said, that there was no dropping involved in this case.

Kelvin Davis : Did Serco notify him of allegations of any similar attacks at the time?

Hon Peseta SAM LOTU-IIGA : No, it did not inform me of any other attacks at the time.

Mahesh Bindra : Given the number of stuff-ups—

Mr SPEAKER : Order! I will give the member one chance to ask his question correctly. If it starts that way, it will be immediately ruled out of order and the member will have lost his opportunity.

Mahesh Bindra : Given the number of incidents, mishaps—

Mr SPEAKER : Order! Get the question out quickly, otherwise the member will lose it.

Mahesh Bindra : —escapes, and even deaths at Serco-run prisons under his watch, what will it take for the Minister to resign—another death in custody?

Hon Gerry Brownlee : I raise a point of order, Mr Speaker. If you recall that question, there was some assertions in there that have not been made anywhere other than by this member. I do not think it is reasonable for the Minister to be asked questions about what is essentially an assertion by someone that is quite independent of the actual issue we are dealing with.

Mr SPEAKER : Order! The question is a very marginal question. I am trying to be lenient to the member because he is a very new member and has not asked a lot of questions. The last part of the question does fall into ministerial responsibility, and it is not a difficult question for the Minister to now answer. I invite him to do so.

Hon Peseta SAM LOTU-IIGA : No, but I understand that the corrections system has improved since that member left the corrections system.

Kelvin Davis : Does he know whether it is true that following recent events, Serco—[Interruption] Can I start again, sorry?

Mr SPEAKER : Yes, the member can start again.

Kelvin Davis : Does he know whether it is true that following recent events, Serco has had to lock down Mt Eden prison since Sunday at 4 o’clock, with prisoners not even allowed showers in that time?

Hon Peseta SAM LOTU-IIGA : No. I am aware, though—and Serco has stated this quite clearly—that it has increased security checks on visitors and it has increased checks for contraband on prisoners, and that is a good thing.

New Zealand Cycle Trail—Progress

11. JACQUI DEAN (National—Waitaki) to the Minister of Tourism : What reports has he received on the progress on the New Zealand Cycle Trail?

Hon PAULA BENNETT (Associate Minister of Tourism): on behalf of the Minister of Tourism : Good news for the House. More than 2,500 kilometres of the cycle trail have been completed in New Zealand now. This year’s Budget included new funding—an extra $3 million for the Far North District Council and to finish the Twin Coast Cycle Trail. It is fantastic growth in regional tourism, which has seen over $7 billion being spent by international visitors in New Zealand. The Prime Minister’s cycle trail is going fantastically.

Jacqui Dean : How is the cycle trail contributing to jobs growth in our regions?

Hon PAULA BENNETT : So far 1,225 people, and I know you are going to want me to repeat that—1,225 people—have been employed on the construction phase alone of the cycle trails. This includes 150 people on the Twin Coast trail in the far north, 63 on the Mountain to the Sea trail in the Manawatū, 45 in the Bay of Plenty, and 107 on the two West Coast trails.

Jacqui Dean : In what other ways are the cycle trails contributing to regional economic growth?

Hon PAULA BENNETT : It is so hard not to trifle with your time because this could be such a long answer, but I will skip to the many small businesses that have sprung up or expanded throughout regional New Zealand. At least 50 new businesses have started to provide service to tourists using the trails. At least 43 more businesses have been able to expand. The Mayor of Ruapehu was just telling me the other day about going from being just a winter destination to now having about 11,000 visitors most weekends in summer because of the cycle trail. I see my friend Alastair Scott. In the Wairarapa alone, Green Jersey Cycle Tours in Martinborough has gone from 20 bikes to 130 just recently, employing more people. Get on your bike!

Social Services—Minister’s Statements

12. DARROCH BALL (NZ First) to the Minister for Social Development : Does she stand by all her statements in regard to the provision of social services?

Hon ANNE TOLLEY (Minister for Social Development): Yes.

Darroch Ball : Does she still stand by the statements she made on Q+A on 21 June “If they … deliver good results … why not?”, and “if private enterprise can deliver those sorts of results, I wouldn’t hesitate to use them.”, when she was asked about Serco providing child services in New Zealand?

Hon ANNE TOLLEY : To the first part of that question—yes of course, because this Government is all about making sure that the money we invest in social services gets results for the people they are designed for. But I did never ever answer any question in regard to Serco, and I have had no conversations with them about any social services. In fact, it was the interviewer who talked about Serco, using it as an example of private enterprise.

Darroch Ball : Does she still stand by her statement made in that same interview in regard to Serco’s provision of services that it “maybe needs tighter controls”, and does she not think she should have mentioned that to the Minister of Corrections some time ago?

Hon ANNE TOLLEY : I think the member needs to be just a bit careful about how he selectively quotes from discussions, because the discussion on Q+A was about whether I would consider using private enterprise to deliver social services, and in that conversation the questioner talked about Serco. But, in fact, this Government has partnered with a number of private enterprises like Fonterra, with the kick-start, like BNZ, with the small loans, and we will continue to do so as long as we get results for the people who need the services we are delivering.

Darroch Ball : What would her actions be if she continues with her plans to privatise social services with the likes of Serco, and Serco fails as extensively as it has in corrections, but this time costing children’s lives?

Mr SPEAKER : The Hon Anne Tolley, in as far as there is ministerial responsibility.

Hon ANNE TOLLEY : I will say it in words of one syllable so the member can understand. I have had no discussions with Serco at all about the provision of social services, but this Government is determined to make sure that the money we invest in social services actually is effective and makes changes in people’s lives.

Darroch Ball : I seek leave, for the benefit of the Minister—

Mr SPEAKER : Order! The member can start this again and do it correctly, if he expects me to give him a chance to be putting the leave.

Darroch Ball : I seek leave to table the transcript of the Q+A interview—

Mr SPEAKER : Order! It is not necessary to go any further. If the members want it, they can get it themselves.

Point of Order—Treatment of New Zealand First

RON MARK (Deputy Leader—NZ First): I raise a point of order, Mr Speaker. [Interruption]

Mr SPEAKER : Order! It is, we hope, a genuine point of order. We will listen to it. [Interruption] Order! But it will now be heard in silence.

RON MARK : Could I ask you in time to reflect on the tape today. There is a feeling in my caucus that on occasions we are subjected—

Mr SPEAKER : Order! The member will resume his seat. He is very lucky that I am allowing the member to even stay in the House for that sort of accusation. I always review the tapes, and I will always continue to review the tapes.


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