Screen Industry Workers Bill

Members, we come now to the Screen Industry Workers Bill. Members, we come now to Part 1. The question is that Part 1 stand part.

Oh, well, look, thank you; an unexpected initial call. I thought the Minister may have started; I’m not sure of the general protocol. So apologies to the Minister there if I’ve jumped in front of you, or—

💬 Hon Michael Wood: Go ahead. My folder’s open.

Thank you. Look, I’m very conscious this is, obviously, the committee stage. I think it’s important to say that National does oppose this, but not all aspects of it. There remain elements of the bill which we are quite happy to see strengthened. But, overall, we see that this goes far too far in the overall intention—and this is, ultimately, the first question of many to the Minister. The ultimate intention, we think, is going to actually harm the screen industry. So I just want to draw the Minister’s attention, if I could, to his department’s impact statement, where it makes very clear that he believes that this is a low-wage industry. I would welcome some examples from the Minister of that. I’m not disputing whether it is or not. I think it would be just really interesting if he could provide some examples, or his officials could, of what would be perhaps, I don’t know, the average wage of a producer or a grip or a stagehand.

And, importantly, as well, in the spirit of rather short questions, where and how were these wages compared to? So we get in the impact statement—on page one, if it assists. Granted, the officials know; they wrote it. In section A it says that the low wages in this industry were compared to others. I’d welcome knowing what those industries were. So again, I’d like some examples of what the wages are that he sees, and what they were compared against.

Apologies; I didn’t stand up as expeditiously as was expected. I was just carrying my things over to my chair here and the previous Chair got things under way very quickly. But I’ll make some opening comments in respect of Part 1, which we are set to debate at this point of proceedings in this committee stage hearing in the Chamber.

Part 1 of the bill primarily contains the preliminary provisions of the bill, including key definitions, including the critical definition of screen production workers who are the group of workers who are covered by the provisions of this legislation. Can I, at this point of proceedings, just acknowledge the work of the Education and Workforce Committee that did consider this bill. It was, of course, about two years ago now. So it was a select committee of the previous Parliament who considered and reported back the bill that the committee has in front of it at this stage. The main change that the select committee made to Part 1 of the bill was to enhance wording in this part of the bill to ensure that workers do have the freedom to make complaints without any fear of there being any comeback on them. That’s an important part of the bill. It was something that was heard from the sector, that there was a strong desire from workers—from workers’ unions—but also producers in the sector, that we have strong prohibitions against practices such as bullying, harassment, and discrimination. So I think that’s a good improvement that’s in there.

I’ve introduced a significant Supplementary Order Paper. When I say significant, it’s a relatively large one that we’ll work through as we go through the different parts of the bill in the course of the debate today. It’s fair to say that many of the changes in the Supplementary Order Paper are relatively small and technical and quite often relate to a reordering and restructuring of the bill to make it more readable and easy to interpret. The most significant change in Part 1 of the bill that’s reflected in the Supplementary Order Paper relates to the fact that we’re ensuring that workplace relationships as defined under the bill are not just restricted to the bargaining period. We need to understand workplace relationships in the broader context of the relationship between workers and engagers in the sector, and Part 1 of the bill confirms that that occurs across the entire scope of the employment relationship. Those, I think, are the key opening comments I’d like to make in respect of Part 1 of the bill, and I’m happy to answer any questions that do relate to the provisions of Part 1 as reported back to the committee by the select committee.

Thank you, Mr Chair. One of the issues raised in Part 1 of this bill—this is the Screen Industry Workers Bill, which is seeking to undo the legislation that was called the “Hobbit law”, which was introduced by the National Government back in 2010 or 2012, I can’t remember which, and which was put in place in the context of a big union fight, which was, frankly, threatening the arrival and production of The Hobbit films. It was an arrangement that the National Government of the time brought in in order to ensure that they went ahead. And since then, the New Zealand film industry has gone from strength to strength. It is in a reasonably good shape, although, of course, it has been battered severely by the COVID restrictions over the last couple of years—just starting to come out of that. And I’m bound to say that the feedback I’m getting from many in the sector is: “Great! We were just finally getting our head above the water post-COVID. There’s still lots of issues that we’re having to deal with—lots of sickness and things like that. Oh dear, I just wish we weren’t having to deal with very significant labour relations changes at the same time.” So the timing of this bill is a questionable one.

And the most fundamental question I have for the Minister relates not just to Part 1 but to the bill itself, which has been in the freezer for two years. It was introduced by a Minister many Ministers ago, I think, back before the last election in 2020 with a hiss and a roar, and then put in the freezer, and it has been pulled out, stuck in the microwave two years later, and is suddenly being pushed quite rapidly through the last stages. And so the fundamental question I have for the Minister is why—I suppose to talk through the timing of why he thinks this is a good time to be undergoing very substantial reform in an industry that is still battling the effects of COVID, just getting itself back on its feet again. There’s quite a bit of stuff going on. There’s also, of course, the merger of TVNZ and Radio New Zealand, which nobody seems to understand the logic therein.

💬 Hon Willie Jackson: No—only you.

I’m getting slightly off topic. Old Willie Jackson probably understands it. Well, who knows what goes on in Willie’s mind. But anyway, that’s going on at great expense, and will have implications and consequences for the industry, unknown at this stage. And so they’re dealing with that, they’re dealing with COVID, and they’re wondering why on earth we need to be dealing with this now. So that’s a question around timing.

The second question is a more substantive one in relation to Part 1, which talks about the exemption from prohibition of restricted trade practices. And this is potentially a very significant change in our employment relations. Here it’s just listed as it relates to the screen industry, but there is, of course, deep nervousness that this is, I suppose, the first cab off the rank of a wider Government agenda to enable contractors to ignore the Commerce Act, which is all about individual companies and contractors not being able to collude in a cartel fashion with each other over pay and conditions and arrangements and cost. So the idea of an independent contractor meeting with all the other independent contractors and collectively coming up with a scheme is what’s called a cartel, and it’s been ruled out in the Commerce Act. So this legislation is wanting to change that, and have an exemption for this industry. So I suppose the question I have for the Minister is: can he be open about his thinking there in terms of what his intentions are for—well, why just this sector? And does he have plans for other sectors?

I mean, the member took all of about 15 seconds in his first speech to stray into striking irrelevance in respect of this particular debate, but let me respond briefly—

CHAIRPERSON (Ian McKelvie): Minister, order! I’ll be the judge of that, and the member did qualify his comments very well, if you listened properly.

And I’m very generously going to briefly respond to his questions around the timing of the bill by contrasting it with the fact that the National Party made its previous changes, which stripped away fundamental international worker rights, in urgency, overnight. This Government has actually worked through a careful process of consultation and collaboration with the sector itself to develop these proposals. So the member’s opening utterances, suggesting that there’s deep alarm or concern in the sector, are entirely baseless. This piece of legislation is based on a tripartite working group, which had both unions and producers at the table, which brought back joint recommendations which have formed the basis for this piece of legislation, and the detailed provisions of it have been worked through very carefully with them over recent months. The member may have blinked and missed it, but there were a couple of other events over the course of 2020 and 2021 which did somewhat disrupt the Government’s legislative programme, and we are returning to those important things now.

The relevant matter which the member did refer to was clause 7 of the bill, which relates to prohibitions on restrictive trade practices. This is quite an important part of it, because, effectively, the grand bargain of the recommendations that came through from the screen industry working group, which are reflected in this bill, is that the contractor status will largely be retained for workers in the sector—and there are seen to be benefits for that from people in the sector—but those workers will have the ability to collectively bargain. It is unusual for people who are contractors to be able to collectively bargain, but that was the joint recommendation of both the producers and the workers who were involved in this process to try and strike a balance which ensures that those rights which were taken away by the previous Government, and which mean that workers in this sector uniquely—remember, workers in this sector uniquely—under the previous legislation were prohibited by that previous Government’s legislation from being able to test their legal status in the courts. Let’s remember, that’s what that lot did to workers in this sector. They took away the right of these workers to go to the courts and test whether they should lawfully be able to be considered employees or contractors. That was the starting position that we’ve had to try and work through and get to a collaborative outcome on. So the outcome, as recommended by the group, is that people retain their status as contractors but they’re able to exercise collective bargaining rights—a right which employees in New Zealand do have. So that was the balance that was struck, and that is the reason that we have clause 7 in this bill in the way that it is set out.

Just responding to a couple of issues raised by the Minister in terms of the widespread support in the sector for this which he claims, I suppose the question I have is: is he aware that a large portion of the funding that drives this industry in this country comes from the Government, and does he concede that it might be possible that many people in the sector are reluctant, therefore, to be openly critical of this Government, which provides much of the funding for them? So I’d be interested to know just on what basis he thinks that everybody is happy about the timing of this legislation, and whether he has really understood the realities of people trying to survive in business in a difficult post-COVID environment where—as every other industry is aware—people are having large sicknesses as a result of COVID.

There are a lot of just practical difficulties of trying to restart a business that was rather frozen during the so-called COVID process. He thinks this is a great time for a major change. I’d put it to him from people that I’ve spoken to that there is no great enthusiasm for it right now, but he may know better.

The second point he raised was that he rather flippantly sort of passed on this notion that, yes, we’re changing this basic arrangement that we have in New Zealand law that contractors cannot and should not collaborate with other contractors to set prices and terms and conditions. It’s called cartel behaviour. That’s why it’s against the Commerce Act, and what this law is proposing is to exempt this industry from that.

The point that I wanted to get some clarity from the Minister about is that he says that this is highly specific—and it is in this legislation—to this industry, and I just wanted to get from him the exact elements of this industry that make this unique, requiring this change. I would also be interested—and he may choose to or not—in whether he can give a commitment that this approach would not be extended to other parts of the economy, because if it was, it would be a fundamental change to the way our markets work. It would be a dramatic change in the way that we organise companies and the way that we organise how things happen, because there are many, many contractors, of course, in many, many industries, and if we were to say that all of them could now—I mean, the Government contracts out billions and billions of dollars of work. If he was to suggest that those contractors could now all sort of get together and collectively bargain over Government contracts, that would be a very interesting thing to conclude, but it would also have a very large impact on many industries.

There is nervousness out there around the Government’s intentions on this and the line between employee and contractor, of course, is a very contested space, and it will continue to be so. So I’m just curious if we could get any more clarity from the Minister around exactly what it is about this industry that makes it a unique case on this particular issue around an exemption from sections 27 and 30 of the Commerce Act.

The particular features of this group of workers that are unique are the ones that I described in my previous comments, which were that the previous Government, by legislative fiat, took away their fundamental rights to be considered employees, to test those rights in the courts, and to be able to collectively bargain. If the member feels very strongly that there should be a consistent position here, he’s very welcome to put up a Supplementary Order Paper to reclassify these workers as employees, if they wish, but I don’t see any particular inclination from him to do that. In respect of the timing of the legislation, the member might take some comfort from the fact that Supplementary Order Paper 234 changes the commencement date of the legislation from one month to three months.

Thank you, Mr Chair. I’m delighted the Minister’s taken calls and I thank him for that. I’m going to reiterate my earlier questions, because even though they draw from the impact statement they very much apply to Part 1 and, actually, arguably to all parts, which is the premise of the bill—that those in the screen industry are paid low wages. And that could well be true. I honestly do not have a list in front of me of what these people are paid, so I would welcome some examples, including from Marja Lubeck, who is the expert in all things and I suspect is not paid, accordingly, the millions she should be.

Secondly, the Minister’s premise, which also reflects into Part 1, are the industries that it was compared to, and I think it would be very useful if the Minister could assure the committee of what industries his officials compared the screen industry to. So that’s reiterating those questions.

A third question is somewhat in response to his timing. We on this side of the Chamber are very aware of his exceptionally large Supplementary Order Paper. The issue is not whether it was a month or, obviously, moving out to three months; it’s the fact that he’s bringing the whole legislation in now when, arguably, we have a screen sector in crisis, and so to that end I would ask him again—in the whole point of Part 1—what conversations, if any, his officials had with Amazon, and have they indicated their reasons to him for why they were leaving? And was part of that a concern about the very legislation that he’s bringing to the House right now?

I turn now—I’m on a bit of a roll and I’m enjoying having my mask off—to clause 11, “Meaning of screen production worker”. Can he give me and the committee some assurance of just how widely this goes? Honestly, the best boy, the gaffer, all of these make sense, but does the caterer or, say, the security guard who’s protecting the production get included? I’m not trying to be silly. This is something I don’t fully know, and I just want to know how far that goes, because if we agree with his purpose—and we don’t—that he’s trying to keep this limited and this goes far too wide, are we going to see in effect collective bargaining pushing through into those sectors? So that would be really interesting to see. I have another question around clause 12, but I think, for the meantime, if that’s all right, I’ll leave it there.

Thank you very much, Mr Chair. I agree with my colleague—it’s good to have the mask off to have this conversation. Yeah, thank you very much, Mr O’Connor. I’ve got a couple of points or questions I want to get into actually—raised in the legislative statement but linked to Part 1 in terms of purpose, and then a question in regards to clause 10. But I guess it builds on some of the comments made by the Hon Paul Goldsmith regarding the consultation process. I would be interested to hear from the Minister in regards to the engagement process around the purpose of the bill with international providers in particular as part of that tripartite group that he has referenced. In particular to that, I refer to the legislative statement where it talks about a strong and world-leading film industry, maintaining competition—and I quote—“between businesses offering this production.” Obviously this sector is an international sector. It involves multiple players from multiple countries, and one would simply assume and hope, no doubt, that we have included dialogue and feedback from those providers as part of the process that’s been undertaken to draft this bill. So I think some clarification as to what that looks like would be very helpful.

Again, still related to Part 1, Section B of the regulatory impact statement is around any assessment around cost benefits, revenue implications in regards to this. These players, global players, will be assessing pros and cons of each jurisdiction. They’ll be assessing the implications of such legislation on their underlying ability to produce the film, both in terms of access to workforce but also other aspects. So I’m keen to understand whether that group actually undertook any assessment, peer review, or comparative analysis between where New Zealand sits pre and post this legislation in regards to the context of other providers internationally. I can only assume that we would have made sure that we were still competitive in that sector, but some clarification from the Minister on that second point would also be interesting.

The third question and then I’ll sit down—I have a large number of other questions, but I’ll finish for now on this one at the moment. [Interruption] I do like to make predictions—you’re very much on script, Simon, in terms of your feedback. So I’m looking at clause 10, “Interpretation”, under Part 1. I’m interested to see there that game developers are actually included in the scope of this bill. Maybe I’m just old-school but I was thinking about making movies and making films. The skill set around game developers being included in the screen industry is something I’d like a bit of clarification on. Why is that the case? It looks like an addition in terms of the way it’s been drafted, so a bit of context around that would be helpful. I’ll leave it at that. Thank you, Minister.

Just a further sort of clarification around the meaning of screen production worker, which is set out in clause 11. Again, one of the arguments put forward for this bill is that it’s a low-paid industry, and, of course, the regulatory impact statement points out on the post-production side, that highly skilled workers are in high demand globally and earn, on average, $150,000 annually, which most New Zealanders wouldn’t describe as a poorly paid industry. So I just wondered whether he’d given any consideration to limiting this to the production side, as opposed to the post-production side, and, if not, why not, and how far it goes. I mean, does it include the people in charge of transport, the contractors there, the contractors for catering? Broadly speaking, all these elements being sort of contracts, does it mean the hotels that people stay in, and the workers in the hotels, the planes they go in—I don’t know. All these issues, I suppose it’s just a sort of a question of the rationale for where he drew the line in this legislation, including production and post-production, and what he was trying to achieve by that would be useful.

So if we come back to the broader point, this is legislation that’s been quiet for a couple of years. The Minister mentioned COVID, but, of course, this was introduced early in 2020—

💬 Marja Lubeck: That was kind of when COVID started.

Pardon?

💬 Marja Lubeck: That was kind of when COVID started.

💬 Hon Willie Jackson: Do you understand that or are you just stupid in the head?

No; I didn’t pick up what the member was saying.

💬 Hon Willie Jackson: Oh, you can’t understand English!

Oh, ah—

💬 Hon Willie Jackson: You don’t understand anything.

—and I’m coming under withering fire from Willie Jackson, who I thought had only one topic, which is the new democracy that nobody had voted for, but, obviously, he has other topics that he can talk about.

So, anyway, getting back to this bill, I’d be keen to get some better understandings from the Minister about the nature of the screen production workers, so we can get a better idea about that, because just remember that all these people, most of whom are individual contractors—this bill proposes to do away with that basic sort of section of the Commerce Act which says that independent sort of contractors and different companies cannot and should not collude or form cartels to negotiate things. So we’re taking a slice out of our economy, and a kind of random one which sort of goes out from all sorts of directions—there is transport and catering and post-production and, presumably, marketing of movies; I don’t know—and extracts them from very important provisions in the Commerce Act. So I just wanted to sort of get a sense of why he chose to include what he included and what his thinking was behind that.

In respect of the question about why the workers who are included in the provisions of this bill are there, I have responded to that in previous answers. It may not be to the satisfaction of members opposite, but I have provided that response.

In answer to the questions that both Mr O’Connor and Mr Goldsmith asked about peripheral sort of work as a security guard or a catering company that delivers the odd meal, or someone like that, those types of worker are specifically considered to be peripheral within the terms of the Act and are not captured by its collective bargaining provisions.

In respect of the questions around timing, I’ve actually just confirmed for myself that the commencement of the bill, of course, is not actually covered in Part 1, so we can, I’m sure, talk about that later on in the debate when we do get to the relevant part there.

In respect of broader costs and benefits, those are reflected in the regulatory impact statement. The costs are generally assessed to be in the low to medium zone. And, of course, the main thing I would note in respect of this and in respect of our engagement with international production houses is that this is the norm internationally. It’s generally normal that workers in this sector are able to collectively bargain. What’s actually abnormal, in this case, was that the previous Government took that right away from workers in New Zealand. So I don’t think there’s anything that’s going to be particularly alarming to international companies who deal with this on every production they do in most other countries, to have to do the same thing here in New Zealand.

In respect of game developers—there was a particular question around them—they were included in the provisions of the—we’re using the colloquial term here, so I’ll carry on using it—“Hobbit law” and so they’ve carried over in that respect.

Thank you, Mr Chair. I want to reiterate the question again to the Minister, for him to give some examples to the committee of the premise of the low wages and who he or his officials compared that with. It’s feeling a bit like a saga now—not the sort of Norse sagas, we’re not quite at that level yet; more a Tolkien-esque saga—that he won’t actually address that question and the very premise that underpins all parts of the bill.

Secondly, and to get really particular—and he can get the legal beagles on to this—we’re sort of switching into, I don’t know, Law & Order sort of mode, can he confirm that, in the likes of clause 11(1)(a), an individual actually means a natural person? I suspect it does, but let’s just get into that, and then explain why.

💬 Maureen Pugh: It’s a bit messy.

I know. I’m just trying to actually sound, really, like I know what I’m talking about, but actually I sort of do. But, anyway, just to make it really clear that, when they talk about individuals, they’re meaning a legal person. Think of that as more of a documentary question.

Another question he might choose to engage with is why, again, in this massive opus of a Supplementary Order Paper (SOP), he decided to strip out the overview of the Act. It’s sort of like the precursor in a Star Wars movie, which gives you a bit of an overview of what’s going to happen. So why has that been removed? We all know that’s the exciting part of a film, and I’m sure, by extension, the exciting part of the bill. So why, in his SOP, has he stripped out clause 4?

Then, switching now to what is clause 12, before Part 1A, talking about what productions are in and not in. That’s in Schedule 2, as the Minister will know, but, of course, because he’s very fastidious, it relates to Part 1. It’s building a little bit on what Simon Watts asked, and the Minister accurately said why computer-generated games are in, but I’m a little miffed as to why the likes of recreational leisure programmes, for example, or variety show programmes are not included. I’m not going to give specific examples; that could be seen as a shout-out. I suppose, as an MP, I’m allowed to do this, unlike Ministers. But why we’ve ultimately done this split—I can understand why some live-event programmes, religious programmes, talk shows are exempted, but one can think of examples where there is, if you will, a wider production of ongoing variety programmes or recreational leisure programmes, which, arguably, could have fitted into clause 1 of Schedule 2. So it’s really just trying to tease that out a bit, Minister, as to why we’ve done this.

But I may, if I might, come back to your earlier point, which was the earlier legislation. You keep referring to the “Hobbit law”—it had this split. So we’d just sort of welcome a slight expansion on that.

Thank you very much, Mr Chair, and I must say I am enjoying, and I do appreciate, the Minister coming back with responses to all those questions. On this side of the Chamber, we’ll maintain to ensure that we’re covering our new content. So we’ll move to looking at—

💬 Simon O’Connor: It’s a sequel!

It is a sequel, actually. The NeverEnding Story, maybe? Who knows! This is going to be good; I’m enjoying this.

Part 1, clause 11—and I do apologise to the Minister, because I’m going to give him a little bit of income tax—a little bit of income tax. I just couldn’t help myself. The reason why is because I think there are few questions here that we need to explore. So it’s clause 11(3)—and particularly there looking at paragraph (a). The comment here in clause 11 (3) is around the definition around “company, partnership, individual … does not primarily engage in work relating to the creation of screen productions …”, and all that’s reasonable, and then there’s paragraph (a), which says“ derived less than 50% of its … annual gross income (within the meaning of the Income Tax Act …)”, etc., etc.

The point that I’ve got a question about for the Minister is around the statement saying “from work relating to the creation of screen productions in the previous 3 financial years”. Why I’ve got a question on, obviously, as we all know, the impact of COVID and the impact of us transitioning out of COVID, and acknowledging when this bill will start, that three-year period looking retrospectively is obviously going to include the implications of periods of time in which there will be very little, if any, production work undertaken here because of the implications around the closed border. My question to the Minister or officials in regards to that is: what consideration has been given in regards to why the three previous financial years was decided upon? How is that going to work in the context of—because it’s a de minimis around 50 percent—if, for example, the last two years have been impacted heavily by COVID, what that may have? And what, if anything, in terms of that will be—and I guess the question is: is there any consideration or transitionary options in regards to that specific point? I don’t think it’s unreasonable to foresee that as we transition out of where we are at the moment, there may be some implications or some unintended consequences, I guess, in regards to that point of the bill. It would be helpful in terms of getting some clarity on that. Thank you.

In answer to a number of the questions that have been raised: firstly, in clause 11—I think it was Mr Simon O’Connor who asked this question—yes, we are referring to natural persons in that clause.

The wording in clause 4 was removed. It wasn’t an operative provision, and further consultation and engagement with stakeholders basically said, “Well, look, this doesn’t add anything. It’s unnecessary.” and good legislative design tends to tell us that if something is not really necessary, it potentially gets in the way and creates confusion. So it was just seen as a good matter of legislative design to remove that, given that it wasn’t particularly doing anything.

In respect of which types of productions are included and which are not, this was largely arrived at as a result of that tripartite process with the producers, unions, and guilds who are involved, who had an assessment as to which types of productions it would be appropriate to include.

Similarly, looking back for three financial years, as I understand it, came out of that discussion, in the tripartite working groups as being an appropriate level time to look back and provide some useful information.

I move, That the question be now put.

I appreciate the question that I asked in regards to income tax was probably reasonably complex, and I acknowledge that officials, no doubt, are beavering away and coming up with a simple response. So I want to buy a little bit of time just for the officials to be able to advise the Minister in regards to the question I raised on Part 1, clause 11(3)(a) and (b), in regards to why it’s three financial years and what the implication is around COVID—and I’ll keep going.

There’s another aspect I just wanted to seek clarification on as well, just while we’ve got a little bit of time—and I’m sure that that answer is coming because it’s pretty important—and it’s in regards to clause 11(4). This refers to the comments around support services in regards to the “peripheral contribution to the creation of a screen production:”. Paragraphs (a) and (b) of the definition of “support services”—paragraph (a), particularly—all seem reasonable, but paragraph (b) is the one which raised my eyebrows a little bit, and it’s one of those catch-alls: “any other services of a similar nature”. When you look at what it’s referring to, and I’m assuming it’s referring to paragraph (a) above, there are such words like “management, and representation services:”, and so those are pretty generic terms. Then you’ve got a follow-up of paragraph (b), and my question to the Minister is what is his expectation of what will be captured by paragraph (b) in regards to any other services of a similar nature?

Following on from that, why then is—I’m just trying to quote the linkage around that definition of “volunteer”, which is then directly below that, and I’m struggling just to understand. Maybe it’s just the way in which I’m reading that. How the volunteer statement, or the definition of what a “volunteer” is—maybe just helping me a little bit in terms of that. Is that linking to paragraph (b) above, or is it just sitting there? It doesn’t seem to be linked to anything in the bill. So a little bit clarification by the Minister just on those two points would be preferable.

Hon PAUL GOLDSMITH (National): I’m not entirely sure just in terms of Supplementary Order Paper (SOP) 234 relating to Part 1 of Schedule 1. It talks about contracts entered into “before commencement of this Act”, and I’m not sure whether this is the right part to be discussing it. I think it is, but the Minister’s SOP changes it so that when a screen production has occurred, like all the ones that are occurring at the moment, and everybody has entered into their contracts and everything’s fine under the one set of rules, this legislation says under the Minister’s SOP—originally, it said that “The terms and conditions of the … contract [would] apply for 12 months after the commencement of this Act, as if the Act had not been enacted.”, which would mean that after 12 months, if it was a long production, whatever people had arranged could be unarranged or rearranged following this Act. But that was changed under the SOP to say that “The provisions of this Act, … apply to a … contract from the date [that] this Act comes into force.” So I’d like to know why the Minister changed it and what impact does he think it will have on current productions and what advice has he had on that—does he know what it would mean?

So we’re talking about the industry’s perception of this country, because he mentioned that everybody else in the world does this. OK, not everybody else in the world is quite as remote as New Zealand. We’re the last bus stop in the world and there are a lot of other places in the world that you can go to, and so it’s a big decision to come all the way here. International companies look at the situation in New Zealand and wonder what the environment is. If they find that they’ve made an arrangement, got contracts signed, got a budget in place, and got themselves all organised and know what they’re doing and know where they’re going, and then the Government passes a law and says that all of that can be rearranged by collective bargaining, potentially, in certain circumstances—and I’m not quite sure what—then that could be potentially alarming.

So I’d just like the Minister to explain that and what his rationale for change was, what advice he’s had on what impact it will have on existing arrangements, and, if there is any significant impact, what impact that would have on the broader confidence that the sector has in terms of planning things which are of great cost and substance.

Mr Chair, if I can respond to a couple of further questions. The two questions from Mr Watts are, effectively about threshold questions—who’s brought into the ambit of the Act and who’s not, so clause 11(3)(a) and (b) refer to, effectively, looking back three years and the 50 percent threshold. As I said before, you’ve effectively got to have some sort of an assessment as to the degree to which people are primarily employed doing this kind of work. You wouldn’t want a situation where you have a de minimis, which is very low, and maybe, you know, 1 percent of the person’s earnings over a period of time have been from this kind of work—you wouldn’t necessarily be wanting to catch them within that. So the provisions at clause 11(3)(a) and (b) are, effectively, about establishing a reasonable threshold, and, as advised previously, that was worked through with the screen industry working group, which included the producers, the unions, and the guilds, and they thought that was reasonable.

In respect of how that impacts the tax affairs of the person concerned, given the nature of the employment relationship is that the person is a contractor, the individual will need to work through what their tax obligations are there. But I don’t actually think there would necessarily be a huge impact for them there.

In terms of volunteers, clause 11(4) is simply confirming that people who might be there in some sort of a volunteer capacity, the legislation will not provide to them, and the various bargaining rights and other things that are contained in the legislation will not apply to someone like, perhaps, a student who has come in to have a look at a production for a few hours and get a bit of experience about how these things work and is sweeping the floor—they won’t need to get brought into the ambit of the legislation. So the meaning of the volunteer is simply the normal meaning of the word “volunteer”, and that is there to ensure that we don’t inadvertently bring in a group of people for whom there was never any intention to do so.

In respect of Mr Goldsmith’s questions, I mean, they really go to the fundamental reason why we have this piece of legislation in place. The Government’s view is that we’re actually dealing with some pretty fundamental rights that workers have, and should have, and that are generally internationally recognised—that being the right to engage in collective bargaining. It’s not the view of the Government that we should be taking away what are fundamental international labour rights for any reason, including the whims and wishes of international companies. Those are basic building blocks of a decent, civilised society. International labour rights, including the right to collectively bargain, are generally considered, under international jurisprudence, to be an important part of the human rights framework. So we simply don’t have any truck with the arguments that there might be someone who wants to invest here that wants us to remove fundamental rights and, therefore, we should do that—we just don’t accept that. The member opposite might, but that is a fundamental difference of view.

In respect of when the Act comes into force as reflected in the Supplementary Order Paper, that is simply a pragmatic and straightforward arrangement, as I’ve described before.

I think the Minister sort of missed the point of my question—I think, perhaps, wilfully. The point I was making was that normally when laws are changed, they apply to new decisions going on from after the law been has been passed so that people know what they’re dealing with.

In this circumstance, what is being envisaged by the bill is that a production that all been organised, been set in place, under rules that were clearly understood and established, now are being told, midway through, that the rules can change and it could be very different. And it’s not just applying to new decisions, where companies are deciding, “OK, where are we going to do this? Are we going to do this in New Zealand? What’s the situation here?” and they see the legislation in place and they know what they’re doing and so they make a decision about that. And if the Minister is right that nobody is worried about this sort of stuff, well then they’ll continue to invest in New Zealand.

But what’s happening in this bill is that midway through, the rules of the game will change for existing arrangements. I would have thought there was a pretty good argument for not applying it directly to pre-commencement contracts. I would have thought there would be a good argument, certainly, at the least, for extending it 12 months, as the bill originally did, so that most productions apart from, presumably, a very few long-term ones will have been concluded.

So to moot the change under the Supplementary Order Paper, which is not debated on—I presume it wasn’t something that the working group debated; the group that the Minister seems to say came up with everything in this bill, and clearly didn’t. I’m sure they didn’t recommend that, but I’d be interested know from the Minister whether they did and whether there has been widespread enthusiasm for it.

Secondly, on the question of the industry, sort of, views at the moment around timing, I wonder if he could just tell us whether he had received any correspondence from elements of the industry encouraging him not to pass this bill or make it happen immediately and alerting him to the fact that they needed more time. I’d just be interested to know if he could give us any indication around that.

I’m going to take a call from Simon Watts, but I think you’re starting to scratch around the chicken coop a bit.

I haven’t seen that movie, but I will get into it. Look, I’m referring to the regulatory impact statement and particularly section B and the subsection which, I quote, says that, “Given labour costs make up a large proportion of production budgets, any increase to worker earnings as a result of bargaining could mean that New Zealand becomes less cost-competitive destination for production companies compared to other countries.”

And to the question I asked earlier, the Minister provided an indication that it seemed to be that there was some input in regards to feedback from where New Zealand will sit with international peers in regards to this, and the Minister said that this seems to be consistent across other countries. But can the Minister just be specific in terms of the fact that—well, just give us confidence that we’ve compared ourselves against what we would consider our partners in this space, our neighbours, etc., and just be categoric around the fact that the assessment has been undertaken. Because, obviously, the officials have highlighted this concern, as well, in the regulatory impact statement. And so that adds further substantiation that this is actually an issue that does need to be considered appropriately, because no one wants to see us becoming less cost-competitive as a destination for production companies compared to other countries.

The second aspect is just a small bit of clarification around when the Minister said that the costs to this would be low to medium. If he can just provide context in terms of range, of what low to medium actually means in terms of dollars, that would be very helpful.

Thank you very much. The saga continues. The increased trilogy of four parts. Part 1A—

💬 Hon Paul Goldsmith: Four parts?

Yeah, it’s the increasingly misnamed trilogy in four parts; a very bad joke. Part 1A, which we haven’t touched on—

CHAIRPERSON (Ian McKelvie): Well, I’d just advise the member that Part 1A is the next part.

Is part of Part 1? Yup. So why has he inserted the term “good faith” along with “freedom of association”? I think he would need to explain that to the committee, because in—

CHAIRPERSON (Ian McKelvie): Well, that is part of the next debate.

Oh, is it a separate debate? Oh, well, look, this is something to look forward to.

💬 Hon Member: You’re ahead of your time.

I know. Well, something to look forward to. Well, look, I’m not going to take up any more time. And I’m looking forward to that being a whole separate part.

CHAIRPERSON (Ian McKelvie): I call the honourable Minister Michael Wood. Oh, he’s sat down again. I call the honourable Minister Michael Wood.

I’m enjoying myself so much. I can point Mr Watts to the regulatory impact statement, which I think he has, which provides, I think, some further information about possible costs. There is just a fundamental difference of views here. This legislation is proceeding because the Government has a view that it is a fundamental right of people to be able to engage in collective bargaining. We think that’s important. We think it goes to important rights. We think it was wrong that those rights were taken away by a very targeted Act of Parliament at the time that that occurred. Now, that might well result in some increased labour costs, because collective bargaining, by its definition, is about addressing an imbalance in terms of bargaining power. But there is no evidence and no information we have to suggest that that will be significant or deleterious to the industry.

In respect to Mr Goldsmith’s questions around the pre-commencement period, it’s worth noting that in respect of Part 1—it’s one year—we’re just talking about the inclusion of the mandatory provisions in Part 1 here. And those are very basic things like the right to raise a complaint, there being a dispute resolution process, and those sorts of things. I don’t think they’re going to particularly alarm anyone in respect of the provisions of Part 1. I think those are probably the key remaining questions that I had to answer there.

I move, That the question be now put.

The question is that the Minister’s amendments to Part 1 set out on Supplementary Order Paper 234 be agreed to.