Debate on Crown Entities, Public Organisations,and State Enterprises

I move, That the House take note of the performance in the 2001/02 financial year and the current operations of Crown entities, public organisations, and State enterprises. Last year, in speaking to this debate, I said that this is one of the less enticing and enthralling debates that Parliament holds on an annual basis. It is part of the annual cycle of financial debates. In the early 1990s and late 1980s when we were looking at the review of the financial debate and structure, we agreed to have a 4-hour debate on State-owned enterprises, subsequently reduced to, I think 3 hours. This debate has turned into yet another long extended round-arm debate covering everything under the sun except the things it is supposed to by and large, which is actually the performance of the State-owned enterprises, Crown entities, and similar organisations, and it is therefore a classic occasion on which various members get up and improve their adeptness at reading the research unit notes provided to them earlier in the day. Linda Scott, I am sure, will fulfil my expectations in that respect to the nth degree.

It will be useful for the Standing Orders Committee to have another look at this particular debate to see whether we can tie it more closely to specific issues. One of the sad features of Parliament over the last 5 to 10 years has been the increasing tendency for all debates to degenerate into general debates as opposed to being specific debates on nuts-and-bolts issues. Indeed, I have noticed that many members are now completely incapable of debating nuts- and-bolts issues, and are capable of debating only at a sort of high level of low rhetoric, if I can put it that way—not, of course, that I myself am necessarily bad at debating at a high level of low rhetoric, but occasionally it is nice to get down a demonstration of an ability to master facts in some detail.

One of the issues that I want to address myself to this evening—through the supportive barracking from the National Party opposite—

💬 Brian Connell: Ring the bell!

It is good to see the entire intellectual grunt of the National Party lined up opposite. I want to discuss the issue of capital budgeting as it relates to the State-owned enterprises in particular. Since the late 1980s, and particularly the 1989 Public Finance Act, New Zealand has, under successive Governments, developed, I think, what is fair to say is the most complete and effective control of its operating expenditure of any Government in the world. In that respect, our systems and our accounting procedures are certainly much more well developed than almost any other country, although it does lead to some confusion amongst members opposite in terms of what a surplus actually is in that regard. However, it is true to say that partly because of the necessity of bringing Government spending under control and moving into surpluses, capital spending has been much less well addressed in terms of the controls upon it, and, indeed, capital expenditure and capital budgeting is still a very, very ill-defined and indeterminate art compared with that of operating expenditure. Generally speaking, the Government nearly always underspends its forecast capital spending for a variety of reasons.

💬 Brian Connell: Who wrote this speech?

Nobody wrote this speech; I am actually giving it as I go along. I thought the member might have picked that up. I do not need notes to do this stuff. This is the job of being the Minister of Finance. [Interruption] This is about State-owned enterprises. So what I am trying to explain to the member with the well-known curriculum vitae, which is circulating now for a price in the Russian underworld, I am told, as an example of how to do a curriculum vitae for the future, is that we are facing the issue of trying to work out how to control better and get a better picture of what our capital spending is. The reason the State-owned enterprises come into this—and it is the reason that I am developing this theme—is that the State-owned enterprises have a very large amount of the Government’s capital tied up in them.

💬 Brian Connell: Get a real job!

This is a real job. The State-owned enterprises are responsible for a great deal of the Government’s capital expenditure either directly or indirectly, but very little of that actually comes back to the Government for direct oversight. One thing that we are working through with the State-owned enterprises is trying to incorporate into the next Budget round any forecast they may have for requirements from the Government for capital injections, because those capital injections from State-owned enterprises need to be dealt with on the same basis as the Government’s other capital expenditure in terms of what the priorities may be.

The second element, of course, is to try to ensure, by a series of benchmarking and other measures, that State-owned enterprises’ capital structures are the most appropriate from a commercial perspective. In particular, the Government is concerned that some State-owned enterprises may develop what are called lazy balance sheets, which then enables them to behave in such a way that they may engage in less than optimal usage of that capital for investment purposes. No commercial organisation should have those kinds of lazy balance sheets, because it does not lead to the best commercial behaviour in their respect.

💬 Brian Connell: Who told the Minister that?

Treasury. This Government and a few other people around the place, like the Institute of Directors, Business New Zealand, and those sorts of people, have some interest in that—I am sure that if the member ever visited them they are on his CV as people that he has close relationships with. What we are therefore concerned to try to ensure is that this Government is committed to long-term ownership of the State-owned enterprises. That has led to some very significant differences in the way in which they have behaved and performed. Let me pick out an example. Landcorp, which struggled for a long period of time, under its present leadership of Alison Patterson and a very good board has managed to produce outstanding financial results. Landcorp Farming has a record net profit after tax in 2002 of $38.4 million. That is because it has been encouraged to take a fully commercial approach, allowed to reorganise its assets, selling some that are less useful, consolidating some of its other assets, and the result of that is a massively improved performance and return to the Government.

The problem with the previous Government was that it was so concerned to sell that it was not worried about the thing operating effectively in the meantime. The purpose of State-owned enterprises was to simply get them flogged off as soon as a pack of mates appeared over the horizon, get rid of them, and pretend that this somehow improved the Crown’s balance sheet, and on the National Party proceeded from there. Of course, the previous Government improved the Crown’s balance sheet only if it sold them for more than they were worth on the books. So what the National Party used to do was keep them undervalued on the books and run them down. Then when National sold them it made a paper profit in terms of accruals accounting procedures, and that therefore pumped up the operating balance for that year. But one cannot keep doing that trick year after year after year. One runs out of that kind of trick as an approach to the Government’s fiscal policies.

We need to get a clearer picture from the National Party about where it stands on the sale of State-owned enterprises. This afternoon Mr Sowry said that if and when the Government gets control of the railway tracks, we will have to wait and see whether it will sell the railway tracks again. I tell Mr Sowry that 70 percent of New Zealanders support buying back the railway tracks.

💬 Dr Lynda Scott: That is just poll-driven!

Lynda Scott will oppose that because she opposes anything that 70 percent of the people support. She is happy to be a 21 percent party getting 70 percent of the 30 percent that oppose what the Government is doing. That is her approach to life. We say that the people want control of that track. We believe that it is a sensible strategic asset. We are doing our best to purchase it back, but the National Party cannot even tell us whether it will sell it again should it ever, ever get lucky enough to get back into power. Will it sell off more of the State-owned enterprises in terms of the electricity generators? Will it flog off Transpower? Will it follow Dr Brash’s prescription? Dr Brash believes that we should sell most of the schools.

💬 Government Member: What!

He has said that we should sell most of the schools. It does not matter who owns the schools, he says, as long as we have phonic teaching of reading and as long as we have performance pay. As long as Auckland Grammar can have 15,000 students, then it does not matter who owns the schools. That is Dr Brash’s approach to education. Dr Brash has said that it does not matter who owns the hospitals. [Interruption] Yes, I am to be given a senior honours tie in the next few weeks, and I am terribly grateful for that recognition—somewhat delayed, I must say—by about 41 years—by my old school, but I am extremely pleased that it will do that at last.

What is the National Party’s policy on the ownership of hospitals? Dr Brash said that it does not matter who owns them. He said it would be a good idea to realise that asset, and to hand them into private ownership, and for the Government to purchase services from those hospitals. Is that Lynda Scott’s policy on health? She has gone very quiet. She has had a sort of sudden attack of modesty on those particular matters. Is it the National Party’s education policy to flog off the schools? We want to hear some answers from National tonight, not just a series of questions.

I hope that members on the other side of the House might just be able to hold their tongues long enough to let me get started. Tonight I will talk about the performance of the district health boards. This Government has had 4 years in which to deliver on its promises and for New Zealand to see how the district health boards are going to shape up. We went into the last election saying that a lot of people out there were at the point of saying—

💬 Mark Peck: What happened at the last election?

I know that those members on the other side of the House cannot help but be rude. They just do not know how to sit there and keep quiet and listen. I will tell the House a story about the person I have just spoken to on the telephone.

If those members want to talk about how well the district health boards are shaping up, I will tell them. There is $9.6 billion going into 21 district health boards that are absolutely failing. This is a story about a 42-year-old man who had a heart attack. Did he get his angioplasty then? No. He was put on the waiting list, but he did not have high enough points. So what happened? He had another heart attack in December last year. [Interruption]

The ASSISTANT SPEAKER (H V Ross Robertson): I remind members sitting to my right, of Speaker’s ruling 51/5(3).

The gentleman had another heart attack in December. What happened then? Did he get his surgery? No. His surgery was booked for May of this year. What happened then? He went to Capital and Coast Health, but Capital and Coast Health has set up a system whereby it books its intensive care units fully with electives—and acutes are always going to bump electives. What happened? An acute came in, and that man’s surgery was cancelled. OK—he got booked again. He came into hospital, and the patient in the next bed had to tell him that his surgery was cancelled. Did members know that? No doctor, no nurse—no one—could be found. When his fiancée came to pick him up, he was told that that was common policy—that that was what was going to happen. He did not get put back on his warfarin. That man went home and died.

The reason I bring up that case is that it shows a total systems failure. If a hospital books out its intensive care beds with electives, it knows that patients will get their surgery cancelled. That district health board should have been using a private contract for the times when those patients have their surgery cancelled, because in private hospitals no acute case bumps electives. Electives can be completed on time. Wakefield Hospital used to have a contract, but that ideologically driven district health board and the chairman of that board cancelled that contract. And the number of points needed has gone up. I have the Clinical Priority Assessment Criteria here. The number of points required has gone up from 35 to 50, and that means that more patients will die. That is what district health boards are delivering, despite the fact that $9.6 billion is being poured in. We have 21 district health boards. We are the size of Melbourne—we have 4 million people—and we have 21 boards with increased bureaucracy.

The Health Funding Authority was doing a very, very good job on contracting, and it had reduced the inefficiencies in the system. Untargeted funding is now being poured into primary health organisations. On Friday I was up in Auckland, and I went down to Drury Surgery. Drury Surgery happens to be 2 kilometres over the border for an access formula primary health organisation. This is how ridiculous it is: if those doctors move their surgery 2 kilometres down the road they will get the access formula and cheaper care for their patients. But if they stay where they are, in the practice they have built up for 18 years, they will have their practice totally destroyed by this Government’s philosophy and its funding formula. Even though—[Interruption] Mr Assistant Speaker, I cannot even hear myself.

💬 Lindsay Tisch: I raise a point of order, Mr Speaker. I bring your attention to Speaker’s ruling 51/3(3). When a member has been asked to be quiet, and disorderly conduct continues, you need to rule. I ask you to implement that ruling.

The ASSISTANT SPEAKER (H V Ross Robertson): I thank the honourable member. I know exactly what the member is saying about disorderly behaviour and Speaker’s ruling 52/3(3). I did not actually warn anyone in particular, but I am going to now. The member has her first yellow card, and I refer the member to Standing Order 85(1). Would the member now continue, and I suggest members look at Standing Order 85(1).

Thank you, Mr Assistant Speaker. The reason that I am really concerned about primary health organisations is that the pouring of untargeted funding into primary health organisations at the same time that elective services are being severely curtailed and rationed—rationed all over this country—just does not make sense. Dr Shand and Christine Williams at Drury Surgery want the Minister of Health to come on down there and talk to them about the system that has been set up and is destroying their practice. The system is not based on the patient need; it is based on an ideology, a philosophy, meaning that patients with the same amount of need and the same income are treated differently in different parts of New Zealand. That system is destroying their practice, their business, that they spent years building up.

The 21 district health boards had one ability and that was to go across primary and secondary care. If they had been able to do that they may have been able to get some advantage, but that is not happening. We have 21 district health boards, primary health organisations, and all those structures are not working. This Government decided it was going to have elected boards so that the people of the community could speak out. Those board members are gagged, and they are resigning. They are resigning because this Government makes futile promises. One of the Government’s other promises was about the waiting list. It said it would reduce the waiting list. One would think that with $9.6 billion worth of funding, more people would be getting surgery, but the 10,500 patients in Canterbury who got dumped from the list 2 weeks ago—

💬 Brian Connell: How many?

In just one day, 10,500 people got a letter saying: “You’re off the list. The public health system of New Zealand is not going to treat you.” We do not treat hernias and haemorrhoids and lump and bumps any more, but no one had a discussion about that. Those patients should, at some time, get their surgery. If they are booked and they get bumped from surgery because of acutes, they should be able to get their surgery in private hospitals. There should be a set list and times that should be able to be delivered upon.

I want to tell members another story. It is about aged care. Ruth Dyson has said time and time again that people should stay in the community; that she believes in people being in the community for as long as possible. Well, that is fine, as long as people are safe. I will tell the story of an elderly gentleman in Waitemata who ended up with both legs amputated. This man was in severe pain, and he was sent home to a disabled family who tried to care for him. He should never ever have been sent home, but that is what happened because aged care is under stress. This Government is keeping $150 million for asset testing, and at the same time it is absolutely screwing down aged-care services.

Home care, rest homes, and assessment, treatment, and rehabilitation services are all under pressure. In my home town of Blenheim one cannot get an aged-care bed. One cannot get a hospital bed. Patients are banking up in the hospital. Because of the inefficiency of the system that this Government has created, elderly people are ending up being banked up in hospital beds. They are banked up in hospital and they are banked up in the community, with the whole degradation of that system, which was working so well. Those are the facts, and I have written to the Minister of Health about that. District health boards are bureaucratic. They are 21 times bureaucratic. They are expensive—they are $237 million in deficit—and they are making poor decisions. They are too closely wedded to their provider arm. They are not delivering better care; they are failing.

The Leader of the House, Dr Michael Cullen, led off his speech by saying that this debate is one of the less enticing ones on the parliamentary calendar, and I would have to agree with him. I must confess that I did not know it existed, and I have been rushing around trying to find out what it is all about. I had to ask Dr Cullen what I was allowed to talk about, and he said: “Education—you can talk about anything in that area.”, and I am going to.

It is instructive to go back and look at the sixth schedule to see which entities in education were referred to when this was actually lined up, to see what has actually happened to them, and to reflect, quite sensibly, on the way we administer education in New Zealand. Some people go back to the so-called glory days of the education boards, and whenever they do I tell them a nice little story—

💬 Hon Ken Shirley: This would be at the time of the provincial governments.

No, it was after that, but they used the old provincial governments, because they had nothing to administer. [Interruption] No, when Vogel abolished the provinces he had no one to administer education. That is where our 1877 Act came from. But I would like to tell this little story, because it is instructive. I was principal of a rural area school, and one day the bus driver came to me and said: “Look, I need a brush to clean the back of my bus, to get rid of the dust that’s on it by the time I get here.” So I went down to Ruakaka, where there was a departmental bus garage, and the guy said to me: “No, that’s a board problem. You’ll have to go to the Education Board.” So I went to the board’s outpost in Whangarei, and was told: “No, you’ll have to see the board in Auckland.” So I went to see the board in Auckland. There I was told: “No, that’s a departmental responsibility. That’s transport.” So I finally contacted the northern regional office of the Department of Education in Auckland, and it said it would get right on to it. Three months later I got a little chit to say I could go out and spend $12 to buy the brush. Those were the good old days!

Obviously, the reforms at the end of the 1980s and the beginning of the 1990s were to streamline the whole process and to allow money to go into the schools themselves. Of course, the department was broken down and the new Ministry of Education was supposed to become very lean and mean, just a policy division. Other entities were to be set up to do a variety of things. In 1990, for example, the inspectorate had been taken out of the Department of Education. It became the Education Review Office and was completely autonomous. The Lough report came along in 1990. The number of people—what was supposed to be 360—was cut down to 200, and I might add that it was wonderful to see the bureaucrats down in Wellington scurrying around protecting their positions while cutting the number of people out in the field; but that is another story.

However, my reflection is on what has happened to these people and to that lean and mean Ministry of Education since that time. I want to give members some numbers. In July 1999, 408 people were employed by the Ministry of Education; in July 2000, 633; in July 2001, 702; and in July 2002, 2902. Admittedly, that was because the Special Education Service was rolled over—we have to be fair about that. Then, by June of 2003, 3,377 people were working for the Ministry of Education. In other words, it has just completely grown, like a hydra. Once again, the bureaucracy has flourished. In some cases it has flourished because the entities we are supposed to be debating here have been rolled into them. For example, the Special Education Service, which was a stand-alone organisation, is in the schedules; but it no longer exists. It should be taken out of the schedules because it is now part of the Ministry of Education. New Zealand First agreed with that occurring, because we believed it would align policy much more closely with practice. We now think the challenge is to get the resource teachers of learning and behaviour into the learning support centres, as well, because they are out there on their own, which is one of the problems I think we should look at.

This reunification under the Ministry of Education has come about because of the problems we have seen associated with the fragmentation of education administration. We got it wrong by not having a middle tier. We had the top tier, the ministry, and we had the bottom tier, the schools themselves. We actually devolved too far, and now we have to put something else back in its place. That is turning out to be a regional presence of the Ministry of Education. That is what is creating the middle tier, and, possibly, if the present Government can really think this one through, some economies of scale in the resources that are presently being used. I am talking about things like reading recovery, etc. In 1998 the Early Childhood Development Unit became Early Childhood Development, and in 2003 that is to become null and void. It also will be wrapped up into the Ministry of Education—in fact, that is the only thing that can happen. Early Childhood Development cannot get staff members, because the Ministry of Education is paying people more to do exactly the same job. So there is duplication, and because of that it will be ta-ta to Early Childhood Education.

There is also the Education and Training Support Agency, which, in 1998, changed its name to Skill New Zealand. That has gone ta-ta now. It is now part of the Tertiary Education Commission. Just while I am talking about the Tertiary Education Commission—a new agency referred to in the schedules—I note that whilst there has been a conscious decision by Opposition parties to give that entity some breathing space, some alarm bells are ringing in the way it is restructuring. The reason is to give a regional presence. The only one of the bodies being absorbed into that is Skill New Zealand, which has a regional presence. There is a concern that that is just being duplicated and that, at the regional level, it will be the culture of Skill New Zealand that will become the culture of the Tertiary Education Commission; whereas, the commission has the huge challenge of ensuring that cultures from about four different sectors are merged together into a whole new and unique culture. If, for example, we are just taking personnel from one particular part of that—and Work and Income New Zealand had the same issue—then we could very well end up with having some problems with the Tertiary Education Commission further down the line. So we in New Zealand First make that comment at this particular stage.

We would also like to comment on the Teacher Registration Board, because, once again, it is another of the entities in the schedule. It has gone ta-ta too. There is no more Teacher Registration Board.

💬 Hon Lianne Dalziel: This is 2001-02, you do realise.

That is right, but it has gone ta-ta as of today. The plans were obviously under way when we were talking about it during that period. It is gone, though, and we have to ask why. Was there a reason for it to go? Why was it set up? What are the pressures within our system that this has come about? We have some concerns, because of the importance of the role of the New Zealand Teachers Council, that the speed at which it is going is not in fact establishing a huge credibility for that organisation amongst the profession that it is supposed to be supporting. Particularly, if it cannot even get the registrations done, then how is it supposed to set up the educational standards for teachers colleges?

💬 Hon Lianne Dalziel: Initial teething problems.

Unfortunately, some of those initial teething problems, as the member will know with Work and Income New Zealand, can actually create long-term problems further down the track. That is what our concern is. If that particular body cannot establish its credibility amongst the profession and the education sector, then it will not be able to carry out the vital work that it needs to do.

I want to mention just one other element in the way education is organised these days. It is partially reflective of all the different agencies out there, but it goes beyond that. In fact, hundreds of millions of dollars are going out on contracts to all sorts of bodies—to all and sundry. We would not have a clue what duplications of resources are happening, but I do know, for example, when it comes to the training of school trustees, that the School Trustees Association has contracts, and so do the teachers colleges. What other duplications are there? It is very, very difficult at this particular stage to know what is working and what is not. We get anecdotal evidence of some of these quangos that are not working, but we really need to do some more investigation. In other words, we in New Zealand First think it is time to do a stocktake on the totality of administration and on the way that is being administered in New Zealand after the 13 years or so of reforms that have been put in place. However, the one thing we can say is that nowadays the schools are looking far, far better than in 1989, so some benefits have come from those reforms.

Despite the best intentions of the Minister of Health and many others within and outside Government, it continues to be apparent that many of the public institutions that care for people with mental illness are in crisis, if not total meltdown. Newspaper articles over the last 24 hours make chilling reading. First, the Dominion Post reports that Wellington Hospital is to increase security after one of its patients walked out of its acute unit and into the tiger cage at the zoo, leaving the patient fighting for his life and zoo staff and visitors, including young children, shocked to the core. An independent report released yesterday indicates a number of problems at the unit, including overcrowding, poor layout, and too few staff. I congratulate Capital Coast Health on its forthright apology for what happened and on its plans to improve the situation.

However, it worries me that at the heart of its response is a statement that talks about investigating whether six new beds for committed patients can be acquired somewhere in the district. That health board should not be having to investigate the possibility of gaining new beds. It should simply be able to decide that it needs them and work with as much alacrity as possible towards acquiring them. In this case, as in many others, when it comes to increased numbers of beds, the need is obvious and desperate, and has been for a long time. I hope the day will come soon in mental health management when boards will be able to make decisions within a known and adequate framework of funding and staffing without endless prevarication and bureaucracy surrounding the application of resources.

Another newspaper article this morning—this one in the New Zealand Herald—warns that police in west Auckland are reaching the point where they may refuse to hold mentally ill patients in their cells any longer. At the time of the review of Auckland’s mental health services ordered by the Minister late last year, we were told constantly that one result of the review would be that police cells would no longer be used as an adjunct to overflowing acute units. Now, 6 months after the review team reported back, we have the police themselves in desperation, advising that they have had enough of looking after up to six patients a month in the Henderson cells for periods of up to 4 days at a time. Thankfully, police lawyers are finally looking into the legality of the practice, and I will be interested to see what their advisers tell them. At the same time a New Zealand Public Service Association delegate is expressing deep concern over what will happen if the Henderson police do finally refuse to allow their station to function as a psychiatric outpatients unit. The delegate, mental health nurse Richard Schulman, advises that mental health services in the Waitemata District Health Board area are becoming worse and that putting an end to holding patients in cells will “create more and more pressure on acute beds, because we do not have enough as it is.”

In another of the strange vagaries of mental health funding, the same article reveals that while space has been built for three new intensive care beds at the Taharoto unit, the beds have not been funded. Once again, as with the Wellington situation, everyone knows the problem and everyone appears to know the solution, but somehow there is a massive disjunction between knowing where resources need to be applied and actually getting them there. In another of the oddities of mental health resources in Auckland and west Auckland, when last I heard, the Manawanui Māori health unit at Carrington had plenty of that “built space”, plenty of beds, and plenty of staff, but only one or two or no patients. I do not know whether anything has changed, but even if there are difficult underlying treaty issues involved at the unit, surely while those are being resolved, that resource of staff and amenities could be put to better use in a district that is constantly in crisis through a lack of staff and amenities.

As for the wider situation with the Waitemata District Health Board, it appears to be in absolute chaos and the Auckland review does not seem to have helped. That is not surprising when one considers that part of the district health board response to the review was to provide “an extra 20 intensive packages of care”, which sounds really good until one discovers that those extra packages are not beds in acute units, as one might have suspected, but instead, funding to allow patients to move into the community. This is extremely odd, given that the pressure on acute inpatientbeds, including the practice of holding people in cells, was identified in the review as a key problem. I do not know whether the fact that Dave Davies who is the head of mental health at Waitemata came over from the Health Funding Authority where he was one of the leading lights in denying Auckland inpatient beds, but I would not be surprised if the background of that gentleman might contribute to aspects of the current confusion over priorities in that district.

However, it is not just a lack of inpatient beds that is contributing to the crisis. There is also the fact that funding for community services is often insufficient and, in fact, penalises providers for succeeding. For example, if a non-governmental organisation offers level 4 accommodation to seriously ill patients, when those people start to recover, the funding is cut. So there is no motivation to the provider to do its best to help people get better. There is a very perverse incentive at work here. At the same time community providers are at times reluctant to cater for people who they think will cause too much trouble. All in all, it is no wonder there is a shortage of step-down beds in the community, even, and especially, where they are needed the most.

The structures for funding in the sector are simply not set up to succeed. This comes on top of the fact that Northland, Waitemata, Auckland, and Manukau are still funded at only 60 percent of mental health blueprint targets. Some questions continue to need to be asked. For example, what has changed as a result of the Auckland review? There was a lot of talk about integrated care and the need for people to talk to each other across silos, but if that is supposed to be happening, why are frontline mental health nurses still not allowed any significant input into what is going on? Why is the only information staff are getting about police plans to end the use of cells for patients coming to staff through the media? Why are staff not involved in discussions on how best to manage the string of crises that will almost inevitably result from the police decision? Waitemata’s mental health services are in serious trouble at the Te Atarau, the Taharoto unit, and elsewhere. There is a huge dissonance between workers and management.

Today I spoke with a nurse in one of the acute units who said that when she hears management talking on the radio or other media, she does not recognise anything that they are saying as relevant or pertinent to the life of either her patients or to the staff like her who are doing their best to care for them. This is not strength-based recovery; nor is it integrated care or any of the other nice buzzwords that abound in the mental health world. We continue to have an ongoing crisis at least in the north that I believe demands action way beyond that which the Minister has already seen fit to take. We do not need more inquiries or more money wasted on yet more layers of bureaucracy. What we do need is clear leadership focused on bringing common sense to the application of what resources there are, both inside the hospital system and outside in the community sector.

Members of the mental health workforce must be involved in a genuine way in planning and decision making. The needs of tangata whaiora and their families and friends must be respected to the maximum extent possible. Those needs are not just about countering stigma, or about consumer representation, great as those initiatives have been; they are also about very sick people having the right to be cared for properly in a hospital bed and not in a police cell. Children and young people with mental illness should have all the funding allocated to them spent on them. The Ringfence project has revealed once again that children and youth miss out with services not even delivered to the contracted levels that are way below blueprint targets anyway.

I am sick of hearing lack of workforce as being the reason for all those failures. After 3½ years of a Labour-led Government committed to workforce development, that excuse is becoming somewhat tired. We would have more staff, and more quality staff, if we paid them better. We could do that if there was less wastage in how money was spent. We could provide more inpatient and community beds if the will was there to manage systems more effectively. I hope that the coming year will see some real leadership taken from the highest levels of Government, before more lives are lost, and more staff blamed for tragedies that, in the end, are not caused by worker inadequacy, but rather by massive ongoing systemic failure.

Do members of the Government remember the great promise of Helen Clark before and after she won power in 1999? What was the promise? [Interruption] Mr Benson-Pope says he has forgotten. The promise was more accountable Government, integrity in Government, and an end to extravagance. That is what the promise was. It was a classic left-wing promise, because we have seen more extravagance and more waste under this Government than I have ever seen in my lifetime.

I ask members to think about the great New Zealand Post - Transend experience of millions of dollars being wasted on round-the-world junkets and parties.

💬 Hon Damien O'Connor: Did you advise them at the Fiji conference?

Mr O’Connor asks me about Fiji. The stock standard answer of the Labour Party is to talk about Fiji, because no one ever invites Damien O’Connor to speak. My goodness, that member is not even asked to speak in his own electorate, because they say: “What’s the point? He’s never achieved anything for us.” This Government has ridden roughshod over the West Coast, but it cannot front up to any of the issues, such as the big spending at Transend.

Let me remind members of this. When did the Hon Parekura Horomia find out about the spending and the financial merry-go-round at Te Māngai Pāho? When did he find out that someone in Te Māngai Pāho was advocating that taxpayers’ money go into Māori Sportscasting International and was, in return, getting trips and payments out of Māori Sportscasting as a civil servant? I look to Damien O’Connor and ask when the big weapon of mass consumption, Parekura Horomia, found out about that. He does not know, because he has been sent down here by Heather Simpson to shout one thing: “What about Fiji?”. “What about Parekura Horomia? What about Te Māngai Pāho? What about Mr Tame Te Rangi?”, I ask Mr O’Connor. He has nothing to say. What we find is—

💬 Hon Damien O'Connor: What about Fiji, Mr Hide?

Damien O’Connor can sit there and chip, chip, chip. I have never heard him make a contribution to the House on behalf of his electorate, and I suggest that he actually make a speech.

On 20 February this year Parekura Horomia had a meeting, as a response to my questions in this House, with the chair and the chief executive of Te Māngai Pāho, after which he said that he was satisfied with the assurances of the board, chair, and chief executive of Te Māngai Pāho that the matter had been handled by Te Māngai Pāho. That is what that Minister said. He said that everything was OK, and everything was sweet.

We then had a Treasury-led review, thanks to the sterling work of members of the National and ACT parties, namely the Hon Murray McCully and Mr Rodney Hide, trying to help this Minister—Parekura Horomia of the Labour Party; a weapon of mass consumption—and this Government. They had a Treasury-led review where they designed the terms of reference—so it can look only at Mr Tame Te Rangi—and it is a shocker. Here is a report from the Dominion Post, which I suppose the Labour Party will say is wrong now, too. The report is titled: “Te Puni Kōkiri boss apologises” and begins: “Te Puni Kōkiri boss Leith Comer has apologised to Māori Affairs Minister Parekura Horomia for embarrassing him with incorrect answers to parliamentary questions.”

The chief executive officer of Te Puni Kōkiri knows that the answers that Parekura Horomia provided to this Parliament were lies, they were false, they were incomplete, they were wrong, and that Parekura Horomia was serving to protect the wrongdoing at Te Māngai Pāho to protect Mr Tame Te Rangi, Mr Trevor Moeke, and Hemaana Waka. He was prepared to come into this House and give false answers. The chief executive officer of Te Puni Kōkiri has stated that in the report. Those answers, according to the Dominion Post, have been shown to be “incorrect or incomplete” but Mr Comer said that Mr Horomia could not be blamed for the errors.

Let us put the best light on that. The answers are false, they are incorrect, and the chief executive officer of Te Puni Kōkiri has said that they are wrong. Has Parekura Horomia apologised for getting them wrong? Has he come into the House and said that they were wrong? Has he moved to correct those answers? In fact, Parekura Horomia is so asleep at the wheel that he does not yet know they are wrong, but that is what he told the House. I have not taken a breach of privilege against Parekura Horomia, if members are wondering, because if he is going to tell porkies to the House it has to be deliberate for it to be a breach of privilege.

The ASSISTANT SPEAKER (H V Ross Robertson): The member may not use the word “porkies”. It has been ruled out of order.

If he is going to give answers to the House that are not true, it can be a breach of privilege only if it is done deliberately or wilfully. Nothing about that Minister is deliberate or wilful.

💬 Gerry Brownlee: He’s unconscious!

He is unconscious the whole time. I want to read to members the answer he gave in the House today: “The advice given to me at that time was correct.” What did the chief executive of Te Puni Kōkiri say? He said that the advice was incorrect. The chief executive officer is big enough to apologise. If the chief executive can say that the answers were wrong and apologise to the people of New Zealand and to Parekura Horomia, then no one can tell me that the Minister is not big enough to come to the House, make his apology as Minister, eat humble pie, and move to correct the false answers that have been given. Those answers are not just a little bit false. The Minister referred to a report, described in Parliament as “a litany of lies”. I will move to table that report at the end of my speech.

We have discovered that there are six contracts, totalling $174,000, that Parekura Horomia hid from the House. Who was it that paid out a contract of $174,000 and who had not told the chief executive officer of Te Māngai Pāho or of Te Puni Kōkiri, and who had not told the Minister of Māori Affairs, so that when he came down to the House the answer was false?

We are now at the point where the only person left in New Zealand who still wonders and is still not clear about whether the answers that were given in this House are true or false is the Minister of Māori Affairs, the Hon Parekura Horomia.

I have my differences with Mr John Tamihere—

💬 Hon Matt Robson: We all have.

I know Matt Robson has, too, but Mr Tamihere would not come down to the House, give false answers to parliamentary questions, have it pointed out in a Treasury report, have his own chief executive officer say that they were incorrect and apologise, and still, after 2 weeks, not have moved to correct those answers. I ask Helen Clark and every member opposite where the accountability is. Where is the integrity in that? Is that truly how little the promise of Prime Minister Helen Clark to have integrity and accountability is met?

I remember, on maybe two occasions, when Ministers in the previous National Government got answers wrong in a very small way, and they moved to correct them. That does not happen with Helen Clark or her Ministers; nor with Parekura Horomia. It is a disgrace.

I raise a point of order, Mr Speaker. I provide notice that, pursuant to note 2 of Appendix A to the Standing Orders, I intend to share this speaking slot with my colleague Gordon Copeland. Each of us will take 5 minutes.

It would be very unfair to Parliament if you were to recognise, for speaking purposes, the speaker who has just taken a point of order. You have recognised him for a point of order. There is nothing in the Standing Orders that states that you must follow a script. What you must do is recognise the first person on his or her feet who is seeking the call. Given that Mr Smith was seeking the call for a point of order, which you recognised, that leaves me as the person now seeking the call. It makes no difference to how many calls a party gets—that is all organised—but in this case I got to my feet sooner than he did and that puts some duty on the Speaker to recognise the member seeking the call.

The ASSISTANT SPEAKER (H V Ross Robertson): I thank the honourable member and tell him that I have a list in front of me that has been agreed on by the Business Committee. I did expect the honourable member Murray Smith to take the call because I have his party listed here.

I raise a point of order, Mr Speaker. Notwithstanding your list, let me tell you with certainty, and as an absolute fact, that the Business Committee has agreed that various parties will have a certain number of speaking spots.

The ASSISTANT SPEAKER (H V Ross Robertson): This comes off the member’s time; this is a 3-hour set debate.

That is OK—one could say it comes off the Government’s time. It is not appropriate for the Government to think that it can organise through the Chair who speaks when. The Standing Orders are very clear. They state that if a person wants to speak, he or she should seek a call, but a point of order is quite a different thing.

I do have some involvement in the roster, given that I produced it in draft form for feedback from the other whips. I have had no communication from the National Party whip in relation to any dissatisfaction with the speaking roster. People have been following it in their slots, which are allocated on the basis of the proportionality of the Parliament. Frankly, I am rather bemused and unclear about the point that Mr Brownlee—who was not at the Business Committee today, where this matter was not discussed—has raised.

Although Mr Benson-Pope is the senior Government whip, he is a relatively new member, and I tell him that it is very inappropriate to talk about a member’s absence from a meeting at Parliament. We all have multiple obligations around this place, and we try to fill them according to the need we perceive. There was a National Party representative at the Business Committee meeting. Are you prepared to rule right now, Mr Speaker, that if there is an agreed order we will somehow suspend the Standing Orders, which are very specific? The Standing Orders state that the Speaker recognises the first person on his or her feet to take a call.

The ASSISTANT SPEAKER (H V Ross Robertson): It is the Speaker’s discretion as to who is called. I had chosen to call Murray Smith. United Future is often treated as a Government party, and it is on the basis of proportionality that the debates are set out, anyway.

I seek leave to table the report Litany of Lies in Parliament.

Document, by leave, laid on the Table of the House.

As Crown entities, State-owned enterprises and Crown research institutes play a valuable role in the governmental system that is often underestimated. In particular, they provide parliamentary scrutiny of executive expenditure outside of ministerial departments. Through the select committee procedure—particularly in an MMP environment, where the Government very often does not have a majority—they can be a powerful tool to investigate the executive’s expenditure. Select committees have been quite ready to heavily criticise underperforming, insufficiently accountable, or evasive Crown entities, as well as board members, chief executives, and other senior staff who simply do not want to be accountable.

In that respect, select committees are valuably aided by the Audit Office. However, that is not always the case. There are several areas of executive expenditure where there is substantial expenditure that is not scrutinised by any select committee. In such cases, Parliament is left with the device of oral or written questions, which is an unsatisfactory measure because they can often simply result in evasive or short answers that do not really satisfy Parliament, or it is left with the inquiry procedure. Inquiries are difficult because they are irregular. They are certainly not annual events, and therefore they do not provide sufficient accountability of State-owned enterprises and Crown research institutes.

There is an important public interest criterion in ensuring that all executive expenditure is properly scrutinised by Parliament because we are dealing with large sums of public money, and the public is entitled to expect that members of Parliament, as elected representatives, can investigate those. It is therefore disturbing that the executive is not effectively accountable to Parliament on a regular basis in a number of areas. One of those areas is Government shareholding in private companies. In particular, we have seen the example of Air New Zealand, and it looks as if we are about to see the example of Tranz Rail.

We know that for disclosure purposes Air New Zealand is included as a Crown reporting entity, as if it were a State-owned enterprise, which means that it could be scrutinised as part of the Finance and Expenditure Committee’s examination of the Budget economic and fiscal update, and then debated in the House. But given the incredibly broad nature of the committee’s task, an examination of the Government’s role as shareholder would need to rely upon the interests of an individual member, and it does not give the specific annual assessment that ought to be given to such a major investment.

Very often, as with Air New Zealand—and as we now see with Tranz Rail—the Government is involved in rescue packages, where it puts money into an industry that is close to going down the drain, in order to prop it up, and that is an even greater reason for there to be parliamentary accountability.

The second area is trusts. The Government often funds trusts, but there is not adequate accountability to Parliament for that money. In the media recently we have seen an example of that with the Crown Forestry Rental Trust. Significant sums are tied up in the trust, and the trustees have made expenditure decisions that do not stack up, such as sending their chairman to the Privy Council, at the expense of $25,000, to sit at the back of the Privy Council to hear a matter dealing not with forestry, but with fisheries. We know that the Māori Affairs Committee is currently undertaking an inquiry, and we can look at the leaky homes situation as a way of questioning that expenditure. But what about next year? What will happen to the Crown Forestry Rental Trust next year? Will we embark on another inquiry? This one has been several years. There should be more accountability in that regard.

In terms of shareholding, I believe that effectively the shares should be held and managed by a Crown entity so that they are accountable to Parliament through the select committee process, and so that there is Audit Office oversight. In terms of the trusts and also the Māori Television Service—which appears to be accountable only to the Māori television electoral college, and not to parliamentary scrutiny—those should be made Crown entities so that in all those things we can see the benefit of independent select committee scrutiny. It provides accountability in a timely fashion; not after the event and, very often, after problems have arisen.

I assumed the role of spokesman on energy on behalf of the United Future party in January of this year primarily because of my 14-year-long background in the New Zealand and international oil industry. However, the thing that has occupied a great deal of my time since then, of course, has been the crisis that has emerged in relation to the generation and distribution of electricity within New Zealand.

The first thing that strikes a newcomer to the portfolio is that the industry continues to be dominated by State-owned enterprises. On the generation side there is Genesis Power, Meridian Energy, and Mighty River Power. On the transmission side, Transpower New Zealand constructs, owns, operates, and regulates the national grid, whilst the residual, regulatory planning functions lie with the Electricity Corporation of New Zealand. Accordingly, it follows that the ultimate responsibility in relation to the electricity crisis that we have been facing in New Zealand this year—which, in terms of cold homes and cold showers, has perhaps been narrowly averted because of the unusually mild weather conditions we have experienced—must automatically bring into question the performance of the State-owned electricity enterprises. I think that conclusion is almost inescapable. Had the electricity industry’s State-owned enterprises been working constructively and cooperatively, through strategic planning and well-constructed forward-forecasting models, then New Zealand might be in a very much better situation than it is at the moment.

Furthermore, as I have mentioned previously in the House, because it takes time to bring new generating capacity on stream, I believe it is likely that we will have insufficient supply of electricity as well in 2004 and 2005 to meet the steadily growing demand. Both Treasury and the Reserve Bank forecast the halving of our gross domestic product growth during the next financial year, and large question marks also remain about how our economy will perform in the year to 30 June 2005.

Given those realities, it would be wrong for this House, I believe, to sit idly by without demanding a full and complete explanation from the State-owned enterprises about how things were allowed to go so badly wrong. One cannot help but notice that many, many questions have been raised in the media, but that comparatively few answers have been forthcoming. For example, did Genesis Power know towards the end of last year that the Maui gas reserves were rapidly declining, and react immediately by stockpiling coal? If so, did it receive full cooperation from Solid Energy New Zealand, another State-owned enterprise, in that regard? Rumour has it, for example, that in the interests of hard-nosed business—and I hasten to add that I am in no position to apportion blame—the two State-owned enterprises failed to cooperate, with the net result that Genesis is now having to import coal from overseas.

This raises in my mind some wider questions about the accountability of State-owned enterprises to the public. Treasury, of course, has the Crown Company Monitoring Advisory Unit, which is charged very specifically with the role of the supervision and oversight of our State-owned enterprises. Probably at some point the select committees of this House will want, with its assistance, to probe a little further into some of the issues I am raising in the House today—probably as part of the financial reviews that are to be undertaken in a few months’ time.

In the meantime, I recommend that the Government look again at the reporting lines in relation to State-owned enterprises. We are endeavouring to operate them as if they were commercial businesses, but if that were in fact the case, then, like companies owned in the private sector, the board and management of our State-owned enterprises would be subject to an annual general meeting, with open scrutiny from their stakeholders and from the media. I think that if that annual general meeting process of accountability is good enough for publicly listed private companies, then it is something we should also consider in respect of our own State-owned enterprises.

It would be good to have some representatives of the shareholders in these State-owned enterprises—perhaps a mix of consumer and other interests—who, together with the media, in open session would be able to probe our State-owned enterprises exactly as if they were publicly listed companies. The procedures, whereby shareholders of publicly listed companies hold them accountable, would then have a parallel within the State sector, because after all it is the citizens and the families of New Zealand who are the ultimate shareholders of these important State-owned commercial enterprises.

What a delight it is to speak on State-owned enterprises, because we are ending a period that began in 1984 with Roger Douglas and David Lange, when a period of madness entered upon New Zealand and like some demented Hare Krishna sect—with all due respect to people in the Hare Krishna movement—we started chanting mantras such as “private good, public bad; private good, public bad”. It was so hypnotic that it even took over the then almost sane Labour Party caucus until only a few people were left there who were sane, such as Jim Anderton and those who have come through and now form the core of this wonderful Labour Party that is here today. It is so sensible that it has formed a coalition with the Progressive party. Jim Anderton and I welcome those 52 Labour MPs to work with us on this. We realise that 26 of them need to equal one of us, and that we could save the country a lot of money with just the two of us running it, but in the interests of democracy we will work with them because we have now returned to this period of sanity.

But still, a few demented followers of “private good, public bad” still exist, and even in this House a number of them are around. So let us run through exactly why we have entered such a sane period. The announcement to the country on rail produced great jubilation. Just as we cheered Sir Edmund Hillary 50 years after the ascent of the Himalayas, we are now cheering the fact that on the economic front we have returned to a system where we look for balance in our State-owned enterprises.

In 1993 we had a National Party Cabinet determined to assist the asset stripping of New Zealand and to give it to any overseas bidder, regardless of the consequences. We had an administration that by its sheer incompetence, arrogance, and ideological narrowness, ran down the public infrastructure of the country, regardless of the known economic and social consequences. A decade ago we had at the Cabinet table what can only be loosely termed the intellectual elite of the current National Party, including one of its candidates for leader, the Hon Dr Lockwood Smith. We also had the public relations king and chief strategist of the current National-ACT alliance—a term that I once used proudly—the Hon Murray McCully. Those gentlemen, together with the associate transport minister of the day, Maurice Williamson, were hell-bent on selling the public railway system. They were not driven by empirical evidence or impartial advice. On the contrary, the National Government, which sold rail 10 years ago, was urged by Treasury at the time to at least retain the line network as part of a Kiwi share arrangement, in order to ensure New Zealand’s interests were protected during the asset sales process. It rejected that advice, and the resulting plundering of the rail system and the running down of the assets were the logical outcome of that mismanaged privatisation, which was the loss of control of the network.

Now the taxpayers of the country have to pick up the tab for National’s policy errors. The mismanagement of the sale of New Zealand Rail was enormous, and heads should roll over on that side of the House. But what a difference a decade makes. Now, we have a centre-left coalition Government that is ready to meet its responsibilities to the regions of New Zealand. The need to reinvest in rail, including the repurchasing of the rail network, is necessary for New Zealand’s future. This Government is not paralysed by being constrained within an ideological straitjacket. Because of that we are able to rationally look at the actual and real economic, social, and environmental needs of the regions of the country and step up to take our responsibilities, should the market fail to deliver in New Zealand’s interests. New Zealand’s future success in the critical economic industry and regional development areas explains why the coalition Government has announced it is prepared to buy the rail network for $1, and take a 35 percent stake in Tranz Rail.

Of course, if the invoice I gave to Sir Michael Fay for $100 million when he last arrived on our shores to celebrate the America’s Cup, which he was hoping a Swiss syndicate would take, was paid, we would have $100 million more to put into this fund. Sir Michael and his friend David Richwhite, true patriots of New Zealand, collected their share of New Zealand Rail, and, being the patriots that they are, they now live in Switzerland and Ireland.

The ministerial ad hoc committee studying this issue of rail, on which the Progressives are represented by Jim Anderton, understands that regions need strong transport networks, and the continued presence of rail is vital to assist regional growth and development. The coalition’s preparedness to stand up and fulfil its obligations will allow this and future Governments to have a role in ensuring that transport solutions involving rail can be applied to Northland and the East Coast to cope with the upcoming “wall of wood”. It will protect the ability for coal mined on the West Coast to be exported and to be shipped to the North Island for electricity generation.

Then there is that other State-owned enterprise that we can be proud of—New Zealand Post Ltd. A decade ago, the National Government wanted to sell off New Zealand Post to any overseas owner. Back then it was all talk of gloom and doom. New Zealand Post was in trouble, National said, and it had better be sold off. The New Zealand public decided they had better sell National off, so we did not have to sell it at all. The public may not have minded if a foreign-owned New Zealand Post succeeded, but they were determined not to see their post offices sold off for nothing. A successful New Zealand Post is what we now have, owned by the people of New Zealand. That is why it had to wait for the centre-left coalition before the roadblocks in front of New Zealand Post could be lifted. We lifted the roadblocks in front of New Zealand Post’s longstanding business proposal to establish a retail banking arm to service the regions of New Zealand and now, with a Kiwi card, one can get a service owned by the people of New Zealand, for the benefit of New Zealand, in any centre in New Zealand. The news from New Zealand Post these days is dramatic and optimistic, in contrast to the bad old days when National was in the Beehive.

In the news today it was reported that Kiwibank will become an important source of revenue for New Zealand Post over the next decade. New Zealand Post is also confident it can keep a tight lid on costs and hold the price of a standard letter at 40c for the next year. Kiwibank was reported this week to have said that, looking forward a decade, we should expect its Kiwi banking business to be about the same size as the traditional core business of New Zealand Post. The chief executive officer said this: “Kiwibank is important because its financial success will help underpin the financial success of the New Zealand Post group.” He reports that the bank is still growing fast, with new customers joining at a rate of between 300 and 350 a day—yes, each and every day. The problems of Kiwibank are not as predicted by National and ACT; the problems are the precise reverse of what those discredited anti-business parties forecast. Kiwibank’s problems are those of growing pains. It has been far more successful than anyone predicted. Its faster than planned growth has strained New Zealand Post’s profit targets because taking on new customers has substantial costs, but the targets will still be met.

And now there is a sad part to this speech—it is to talk of the death of the grand coalition of the centre right. But I will not ask for a minute’s silence; it is not worth that. Developments in New Zealand rail and Kiwibank this week highlight the collapse of Richard Prebble’s grand coalition of the centre right. New Zealand First deputy leader, Peter Brown, told Parliament earlier today that his party supports the coalition Government’s investment in the rail network—dramatically breaking ranks with National and ACT. It is interesting that New Zealand First would go much further than the centre-left Government. It would negate or nullify the property rights purchased by private investors in 1993 when New Zealand Rail was sold by the then National Government. That party would expropriate the property rights of private investors. The coalition Government does not favour that sort of Bolshevism, but we do accept New Zealand First’s general support of this important issue.

If I have one prediction, it is this: that even the ACT party—that sensible party in terms of matters of finance—will soon find that its members need to go to a State-owned enterprise to get the best interest rate for their credit card because Kiwibank has announced that its credit card interest rate, instead of being at outrageous prices pushed by banks that ACT first favoured and that perhaps funded its campaigns, is now 12.5 percent. I know that ACT, being a truthful party, will tell the rest of the country that that is a credit card that should be supported through that particular State-owned enterprise.

Mr Speaker—

💬 Gerry Brownlee: How does that work?

I say to the member that it happened because it is my turn. I am actually going to say some nice things about Crown-owned enterprises, because—

💬 Gerry Brownlee: Tell us about the lockout of the staff in Invercargill.

The member goes on about a lockout in Invercargill. That member would not know a lockout if he fell over one. He used to be a teacher at St Bede’s and they tell me he was not much good at that, either. So they pensioned him off north to bloody Wellington and now he is in the House as an honourable carpenter, can I say. But I must say that my father says very nice things about Mr Brownlee. He said that Mr Brownlee was the only person who would turn up to a campaign meeting and publicly say to the people present: “Look, I am a privileged person and the rest of you aren’t. Too bad, because you are going to vote for me anyway. I am going to be returned to this place.”

💬 Gerry Brownlee: Stop talking rubbish.

I say to the member that he really enjoyed the campaign meetings.

💬 Gerry Brownlee: I raise a point of order, Mr Speaker. The Speaker knows full well that the member must stick to the topic in front of him. In this event, for the member to bring his father into the conversation—a reverend father of the Anglican church, I might say; a man who has never told a lie in his life—and to perpetrate the sort of myth and rubbish that he is at the moment is an absolute disgrace not only to this House but also to his own family.

The ASSISTANT SPEAKER (H V Ross Robertson): That is a debatable matter and there is always leeway given with a speech—Speaker’s ruling 38/1.

I say to the member opposite that if I have misquoted my father I sincerely apologise to him—that is, to my father. Otherwise, my allowance will not be paid on time.

I do want to say some nice things about State-owned enterprises. I want to start with my airport, Invercargill Airport Ltd. What a successful company that airport has been. I do not know whether members of the House know it, but it was the first of the regional airports that was going to declare itself an international airport. Now, as Mr Shadbolt would say, “Yes, we went and did it. We declared ourselves an international airport and, yes, there has not been a plane in yet but there are great hopes that one day it might happen.” But great things have happened. Members who come down to Invercargill now will be delighted to know that they no longer have to wait out in the rain to pick up their baggage. We now have a covered baggage area, and I congratulate the airport staff on the work they have done. I certainly want to congratulate the very good appointments to that board on the work they have been doing.

It was fascinating tonight that the very first speaker for the National Party was Lynda Scott. Here we are with a financial debate—an opportunity for the finance spokesperson from the National Party to make a hard-hitting speech to the House about the general direction a National Government would take—and they missed the bus.

💬 Darren Hughes: He’s a part-time member.

He could be a part-time member, but it was his opportunity to be in the House to make those comments. Now, what did we get from Lynda Scott? Well, surprise, surprise—[Interruption] That is probably right. I think there might have been a few more members opposite as well at that particular time. We got a very interesting speech about health, well, ostensibly about health. But what was the ambit of her speech? The ambit of her speech was that a particular gentleman with a health problem had that problem because the Government had not contracted the private health system to do the surgery. We asked Lynda Scott which hospital she was going to sell. We had a very interesting revelation this afternoon when the Hon Roger Sowry was speaking about Tranz Rail and New Zealand railways. When he was asked the very direct question of whether he would sell railways, he went on to say: “Wait and see.” I say to Lynda Scott that she should not worry about waiting and seeing. The best way to find out what the National Party is going to do to health and education is to pick up the speech made by Don Brash—

💬 Clayton Cosgrove: Tea leaves.

No, not tea leaves—we can never accuse Don Brash of reading tea leaves. He drinks coffee, so we cannot accuse him of that. But I say to members that they should pick up the speech that Don Brash made to the Knowledge Wave conference—back in 2001 I tell Dr Cullen I think it was. That speech is the National Party policy. That is its policy, because no other member opposite—

💬 Clayton Cosgrove: But Bill English doesn’t agree with it.

He might not agree with it, but I have seen Mr English quoted in newspapers as saying that as part of a caucus one has to abide by the decisions of the caucus. And he does not win all the debates; he probably does not win many of them, frankly. I have seen him on several occasions having to defend things that he obviously disagrees with. There is an extremely good article in the Christchurch Press today about Bill English that I am quite certain Gerry Brownlee has read, in which he was actually called a “decent man”. It said—

💬 Darren Hughes: It can’t have been written by Mr Brownlee.

No, no. The article called Bill English a decent man, and asked him whether it would not really have been a good idea, on some issues like Iraq, just to bide a while—that is an old Scottish saying as I understand it—see what happened, and so on, and so forth. That is the point if ever he is going to aspire to be a Prime Minister. I suppose he is young enough. Ronald Reagan became President at 70, and I suppose Bill English at 40 has a few years to go before he reaches that hallowed age. But I have to say that he has missed his opportunity to have his finance spokesperson up tonight to speak about State-owned enterprises and to speak about what the National Party would do with them.

What was even more fascinating about Lynda Scott’s speech was that we were berated about the fact that there are 22 district health services.

💬 Steve Chadwick: 21.

Well, there used to be 22 Crown health enterprises, and the number is now down to 21. But what Lynda Scott has conveniently forgotten in her speech is that prior to the Crown health enterprises that preceded the district health services being established, we had 14 area health boards. The National Party in those days promised not to get rid of the area health boards. It was National’s policy to continue with them because they were starting to get the sort of efficiency gains that we needed in health if we were serious about delivering health care within the dollars available. Everybody knows that with a service like that there does come a limit. It is the sort of service whereby it would not matter how much was spent, the demand would not be satisfied. So there is a limit, but what did National members do? Overnight in the “mother of all Budgets” they sacked them all, put in commissioners, and they set up a competitive Crown health enterprise system. Yet here Lynda Scott was in the House tonight bemoaning the fact that we have 21 district health services when the whole competitive model of health was set up by the National Party. If we read that in conjunction with Don Brash’s speech we can see that the prescription for selling off health is right there. It is right there because health, as far as Mr Brash is concerned, is just another market.

💬 Steve Chadwick: She said it tonight.

She did say it tonight—it does not matter that people rely on hospitals for a service, what matters is that if one runs a hospital service that is inflationary, inflation is bad, and we have to get inflation out of the system. That is why National would also flog off the schools and the Accident Compensation Corporation. That is why National would sell New Zealand Post and why it would sell New Zealand rail again.

This Government says to its State-owned enterprises that it is about adding value to the Government and to the services that we deliver to the people of New Zealand. It is about contributing to our society. We have encouraged those State-owned enterprises to get on and do that. They are contributing quite well in terms of returning profits to this country. One company in particular, I think it is Genesis, or it might be Meridian, has invested in wind power in Australia. That is about maximising returns to New Zealand and it is about getting New Zealand access to wind power generation at a reasonable rate. It is the old Woolworths concept—the more one buys, the cheaper it is—and I say good on them. They have been given the commercial focus to get stuck in and they are doing good work.

I congratulate Dr Cullen and the Government on the work they have done. State-owned enterprises are an important part of our economy now and will remain so. The one thing the people of New Zealand will not stand ever again is the sort of social experiment we went through when Ruth Richardson was the Minister. They will not stand for that again. They know what is decent, they know what is right, and core public services are part of the social contract that Governments have with the people.

It has always been a mystery to me why the previous speaker was not made a Minister in the current Government. I have watched his performance in select committees and watched him as a local member, and I have always thought he was a man earmarked for the ministry—until I heard that speech tonight. Now I know that he is a member living totally in the past. I will come back to him and some of his silly comments in a few moments.

But, first, I congratulate Mr Rodney Hide on the comments he made to the House this evening. How many people in New Zealand remember the very pious Speech from the Throne just a few years ago when the Rt Hon Helen Clark said: “We will set new standards of accountability in Government.”? Who could possibly have known that she was talking about Parekura Horomia and the way he has conducted the Māori affairs portfolio? What an absolute disgrace we have seen in the last couple of weeks, as revelations have been made in Parliament by the Hon Murray McCully from National and Mr Rodney Hide from the ACT party. They are two people who have assiduously looked at a huge body of Government spending and found the worst kind of graft and the worst kind of corruption that this country has ever seen operating inside that portfolio. The Minister, the Hon Parekura Horomia, knowing that he has misled Parliament and that he has dishonestly answered questions from parliamentarians, legitimately offered—

The ASSISTANT SPEAKER (H V Ross Robertson): No, that is out of order.

I apologise for using the words “dishonestly answered”, and simply say that he knows he has been most reckless with the truth in answering questions lodged by parliamentarians He is still refusing to correct the position he has tried to portray to Parliament. It is an absolute disgrace, and an indictment on Helen Clark and her Government that ultimately will see their fall.

I want to talk about State-owned enterprises tonight, but I will return for a moment to some of the incredible comments made in Parliament tonight by members of the Government. Mr Peck talked with some passion about health. He said that we cannot have this idea that there can be any business side to health, because at the end of the day delivery of health is about services for the people. Well I want Clayton Cosgrove to stand up and tell the people of Christchurch—the 10,000 people who got written off the waiting list just a couple of weeks ago—how much service this Government’s health system is delivering to them. It is nil for those people. People who have serious complaints and life-threatening complaints have been the recipients of letters orchestrated by Mr Peck, Annette King, and Helen Clark, in the name of a public sort of “holding on to the asset”, and have been written off the waiting list. They have been told that they do not have a condition, and to go back to their general practitioner, have a few more Disprin, and call medical staff in the morning. That is what the Labour Party thinks health is all about.

I tell members that we on this side of the House are a bit smarter than that. We know that health is about delivering service. I have to ask every member in this House that if they were run over on the road tonight, or if they have an issue concerning the health service that they need to deal with, do they truly care who pays for it? As long as someone does not have his or her hand in their pockets, and as long as they get their treatment, are they not better off? Or will they simply be patched up with a few Elastoplasts, given a packet of Disprin, and sent home to die? That is what this Government thinks is the best system for New Zealanders.

All bodies that have an interest in health—the drug suppliers, the doctors, and the people who sell the high-priced equipment we need in our health system—are treated as businesses. But somehow, when it comes to the $8 billion that the Government puts up, that is not the case. Health is left up to a bunch of hobbyists who get themselves elected on to district health boards. Well that is not good enough for New Zealanders, and it is not something I will ever subscribe to. The public system can survive in this country, but it must have a greater capacity to respond to patient needs than the current Government is prepared to let it have.

I want to move on to the ridiculous comments made by that fellow from the Progressive party—the former Minister, the Hon Matt Robson, who sits at the back of the House. He said that we are about to end a period of mantra on State-owned enterprises; we are about to end a period when we say that private good is better than public good. What is his justification for that? Well, apparently, the justification is the Government’s decision to put $190 million into a private company, turn it into a monopoly, and tell New Zealanders that the Government has saved rail. That is what this Government has done. It has put up $190 million. That member stood here and said that the Government bought the tracks for $1, with a $500 million liability on them. He then said the Government will guarantee that only one company can use them for 60 years, and will guarantee that the company will be profitable. Does that not send the message out there to anybody who enters into business in this country that, as long as they are hopeless at it, the Government will be there to pick them up? That is a recipe for a basket case, South American - style economy that we are rapidly heading towards.

Then that member came into the House, brought out his Kiwibank credit card, and said: “Isn’t it wonderful that I can get myself into huge levels of debt? But don’t worry, the Government bank is going to charge you only 12.5 percent.” Well here is a question for Mr Robson: where does Kiwibank offset its lending obligations? Where does it take its deposit money and invest it? Do members know? Kiwibank uses the same mix as every other bank. New Zealand dollars are invested off shore to protect funds in this country. Mr Robson talked about a 12.5 percent interest rate. Well let us talk about the unprofitability of that bank and ask ourselves when hard-working taxpayers will get some dividend from the $100 million that they have put into this bank. It is middle New Zealand who are paying for it—people who have jobs. It is the father of the house, the main breadwinner maybe, or the mother of the house might be the main breadwinner. Couples in this country, the vast majority of whom have two, three, or four kids, pay their way on everything. They get nothing from the Government.

They are the same people whose pockets this Government has stuck its hands into and said: “Let’s invest our money in the profit guarantee of Tranz Rail. Let’s put our hands in the taxpayers’ pockets and guarantee the profitability of an organisation like Air New Zealand. Let’s put our hands in their pockets and charge them a bit more in tax, then give them a health system that does not deliver service. And then, let’s put our hands further in their pockets and take out some money to invest in a bank that they will never get any benefit from, in order that other New Zealanders can go into debt and only have to pay an interest rate of 12.5 percent.”

Our speaking times in this debate are too short. I wanted to speak about the other great disgrace in this country—the proposal to set up an electricity commission; a commission that supposedly will make electricity generation in this country suddenly go a lot further. Suddenly we are to have a chunk of it that we will never use, and it will cost us all $200 million a year. This Government’s answer is simply to put its hand in the pockets of hard-working New Zealanders, take more of the money that they work hard to earn, and then put a line across them that is utter spin that says: “We care, and we are looking after you.”

This country will be well and truly ready for a National Government within the next short while. I tell people like Darren Hughes, David Benson-Pope, and the member for Taupo that they will be gone. I tell John Tamihere that if he wants to continue in his political career then he should not sit too close to Parekura “Mr Corruption” Horomia.

The ASSISTANT SPEAKER (H V Ross Robertson): That is out of order. The member will withdraw and apologise.

I withdraw and apologise. I will finish my speech by saying to members opposite that they should not sit too close to a Minister who has no idea where truth begins and lies end.

Is it any wonder that Gerry Brownlee will never become leader of the National Party after that speech. We have heard from the heavyweights from the Opposition tonight, have we not? We have heard from Mr Brownlee and Mr Hide, and, talking about Tranz Rail, the human locomotives—the big guns—from the National Party have been put up. Instead of hearing from the Opposition spokesperson on finance, or perhaps from a commerce spokesperson, we heard from some insignificant person—the Peggy Bundy from Kaikoura—who is the Opposition spokesperson on health. But we heard from “spongy pud”, of course—Rodney Hide. At no time have either of those parties put up a State-owned enterprises policy. I have made a couple of speeches in this House in which I have relished the opportunity—

💬 Rodney Hide: How’s the hair transplant?

They cannot hack it. Those two old bulldogs, those two old has-beens, could not get 7 percent if they tried. They both know that Deborah Coddington is on the way. She is writing her victory speech in the UK, on full pay, on taxpayers’ funds—which I am sure Mr Hide might want to investigate—while on a Qantas media scholarship. The two old bulldogs have had their day.

I have talked in my speeches about the stark contrasts between us and them. I have done it a number of times. This is another opportunity, and I relish it. That group of ACT and National members are the economic vandals of the 1990s. They are the wreckers and the destroyers. One of those members sitting over there, Mr Prebble, is the man who maintains today—and I wish he would keep saying it—that he saved rail. Today this Government, with 70 percent support in this country, has actually done that.

When we ask the National Party what its policy is on State-owned enterprises—because one would think that a party floundering on 21 percent, and ACT, which is floundering on 7 percent, or 5 percent, or 4 percent, would want to explain and articulate to the people of New Zealand their policy on State-owned enterprises—what do we get from National and from ACT? We get zip; nothing.

💬 Rodney Hide: Sell them.

He says, “Sell them.” I hope the Hansard people are writing that down. That will be on my campaign pamphlet for the next election. I hope they tell the people of New Zealand every day that they want to sell assets. At least Mr Hide and Mr Prebble are upfront. I will give them that.

When National Party members were asked today whether they would sell the Tranz Rail track, Rail Co—or the State-owned enterprise that it will be—hospitals, the Accident Compensation Corporation, or schools, they said they did not know. What they are really saying is that they will try to hoodwink the public. They know.

R Doug Woolerton: Of course they do.

Mr Woolerton is right. Those members know that as soon as they get on the Treasury benches—although that will not happen for many, many years—they will flog off the lot. The people of New Zealand actually rejected that policy twice, but the National Party continues to pursue it.

I want to touch on a couple of issues that Mr Hide raised. One has to give him credit for trying. Mr Hide talked about the need for MPs to come down to this House and apologise when they have got it wrong; the need for MPs to have integrity; and the need for MPs to put the record straight. I say to that member that he has never done it in respect of his own personal conduct. He attacked my colleague the member for West Coast - Tasman when he raised the infamous Fiji deal that Mr Hide was involved in, when hundreds of New Zealanders lost millions of dollars. But what did Mr Hide do? He did nothing. Did he come down here—[Interruption] No, no, this is relevant; Mr Hide raised the issue. Did he come down here, correct the record, and show some integrity? No, he did not—not once. He will never live that down.

He also talks about the wastage of taxpayers’ money; he talks about rorts. I ask that member to remember a $110,000 rort in respect of Donna Awatere Huata’s vote. Do members remember the half a million-dollar rort—and we are still counting; the Pipitea Street rort? Do they remember Fiji? I ask Mr Hide what he did after the Speaker’s trip. Who paid for his trip to Albania, and what did he do? Mr Hide criticises people for overseas travel, but at least our people go overseas to advance our country and maybe learn something—not line their pockets or suck up to their rich mates to get their next instructions for the next election. I am aghast that Mr Hide can get up and talk about rorts. I invite him to correct the record and talk about some of his personal actions, which he never does.

I turn to a State-owned enterprise that Dr Cullen touched on—Landcorp. Landcorp is a very interesting State-owned enterprise. It made a record profit of $38.4 million. When I was a fledgling member of the Primary Production Committee we were hosted by Landcorp for a briefing. A number of the board members said to us that they were pleased we had come into Government because now they could put strategies in place to grow, they could increase their profit, and they could put in place long-term business strategies. They knew—

R Doug Woolerton: That’s right.

Mr Woolerton was there and he backs me on this matter. They knew Landcorp was not going to be sold off. Landcorp had been told by our Minister and our Government that it was now a strategic asset. But it could not grow its business under the National Party because it was always ready for the sale axe to drop. It knew that at any time it could be sold off. This company is one of our biggest contributors to agriculture and one of our most profitable State-owned enterprises. I think it is a jewel in the Crown of the State-owned enterprise asset range, and we are custodians of those State-owned enterprises. I think people are proud that these assets are making money for taxpayers. As I said at the start of my speech, this is an example of a party in Government that is a builder and a doer, not a wrecker and a vandal, as we have heard from the other side.

Debate interrupted.

The House adjourned at 10 p.m.