Crown Minerals Amendment Bill

I move, That the Crown Minerals Amendment Bill be now read a third time. This bill makes a number of amendments to the Crown Minerals Act—the Act through which the Government manages all in-ground petroleum, gold, and silver, and approximately half of the coal and other mineral resources in New Zealand. The Government’s fundamental policy objective for managing—

💬 Peter Brown: I raise a point of order—

💬 Mr SPEAKER: I know what the member is going to say. I know that meetings are about to occur, but there will be no more conversations inside the House. I ask members to please have them in the lobby.

The Government’s fundamental policy objective for managing those resources is to allow continuing investment in prospecting, exploration, and mining, which is in accordance with good exploration and mining practice. That objective must be achieved while ensuring that there is an efficient allocation of prospecting exploration and mining permits, that the Crown obtains a fair financial return from the extraction of its minerals, and that there is due regard for the principles of the Treaty of Waitangi. Exploration for, and development of, those minerals delivers resources vital for the economy, regional employment, export earnings, and energy security.

The Crown Minerals Amendment Bill makes a number of amendments to the principal Act that will improve the rules under which those valuable resources are managed. The bill also addresses issues that have arisen because of recent court decisions concerning the transition from the previous regime under the Mining Act of 1971 and the Coal Mines Act of 1979 to the Crown Minerals Act regime. The bill removes the right of licensees to extend or renew their mining licences under the now-repealed Mining Act and Coal Mines Act, as of 5 p.m. on 19 September 2002, in order to give effect to the original policy intention concerning the duration of mining licences. It is this aspect of the bill that has dominated the debate in this House. I would like to take the opportunity to dispel a few myths in that regard.

Prior to 1991, licences to mine minerals or coal were granted under the Mining Act or the Coal Mines Act. Those Acts provided a right in priority for holders to apply for new mining licences if they applied for them before their current mining licences expired. The policy intention, when the previous National Government put the Crown Minerals Act in place, was that existing mining licences under the repealed Mining Act and Coal Mines Act would have a limited life and would not be able to be renewed. That was widely understood within the industry, and was the basis upon which officials and the industry proceeded from 1991 onwards. In the year 2000, the High Court held, in Glenharrow Holdings Ltd v Attorney-General, that the right of mining licence holders to apply for a new mining licence had not been extinguished by the Crown Minerals Act. The court also held that it is still possible to extend the term of a mining licence as a variation of the conditions of the licence. However, in subsequent proceedings in April 2003, three Court of Appeal judges confirmed unanimously what the Crown had consistently maintained, which is that since the old legislation was repealed in 1991, the Minister of Energy neither has had the power to grant a new licence nor was able to consider an application to vary the term of a licence. I feel that it is especially important to point this out for the benefit of the member for Whangarei, who, in his second reading speech, appeared to be unaware that the Court of Appeal has in fact already ruled on this particular matter.

The Government believes that the Act must be amended to ensure that the rights to renew or extend mining licences are expressly removed. These changes will mean that repealed legislation is not perpetuated, and that landowners or occupiers have a say about mining on their land, as was always intended by the Crown Minerals Act. The bill does not extinguish property rights. All current mining licences will continue in force until they expire. At that time, if licence holders want to continue to mine, they can apply for a mining permit under the Crown Minerals Act. Glenharrow Holdings Ltd has been granted conditional leave to appeal to the Privy Council. Special provisions have been included in the bill to ensure that the court’s final judgment in the ongoing Glenharrow proceedings is protected, and that the decisions in this litigation are applied to any applications received prior to 5 p.m. on 19 September 2002, including applications by Glenharrow Holdings Ltd. I feel it is really important to stress this—those have been protected.

Another key amendment, which has been overlooked during the debate, is clause 5. Amongst other things, clause 5 clarifies the requirements when the holder of an exploration permit wants to extend its duration. An exploration permit can be granted initially for a term of up to 5 years, with a right to extend the duration for up to a further 5 years, subject to certain requirements, including the requirement to relinquish at least half of the original permit area. This “use it or lose it” requirement has been part of the regime in New Zealand for over 20 years, and is common overseas. It is well understood. It has become apparent that the way the Act is currently written, exploration permit holders may be able to avoid the relinquishment requirement in a way that was not intended. The amendments will ensure that exploration permit holders who have not made a discovery and want to continue basic exploration beyond the first 5 years, must relinquish at least 50 percent of the permit area on renewal. These amendments strengthen a policy that fairly balances the interests of the Crown and the interests of permit holders. It provides an incentive for permit holders to explore efficiently, and it allows the Government to make acreage available to new explorers, to ensure that exploration continues to flourish.

The bill also contains a number of technical amendments, some of which I would like to clarify for the benefit of members. During the debate in this House there seemed to be a lot of confusion about clause 9 and a misunderstanding that it somehow relates to the provisions to remove the right to renew and vary mining licences under Part 2 of the bill. There is no such link. Clause 9 amends the principal Act to allow the Minister’s unit development powers to apply to both licences and permits. Where a mineral or petroleum deposit extends across the boundary between adjacent permits and/or licences, and the parties fail to cooperate, the Act gives the Minister the power to require what is known as a unit development, in order to ensure that minerals and petroleum along the boundary are not wasted. The way that the principal Act is currently written, the Minister can impose a unit development only in relation to two or more adjacent permits. It does not enable the Minister to require a permit and an existing privilege, or two or more permits or existing privileges, to be developed as a unit. Clause 9 will amend the Act so that the unit development powers apply to both existing privileges and permits. The term “existing privilege” is defined in section 106 of the principal Act, and includes licences that were granted under the former Mining Act, the Coal Mines Act, and the Petroleum Act.

I would also like to address two issues raised by the member for Coromandel during the Committee of the whole House—and I might observe that she was one of the few people who seemed to understand much of this bill. Ms Goudie raised concerns about clause 5, and in particular the proposed amendments to section 36(1)(b), which she claimed would allow the Minister to unilaterally decrease the minerals to which a permit relates. These concerns are unfounded. The Act makes it clear that the minerals to which a permit relates can be decreased only with the prior written consent or on the written application of the permit holder. Ms Goudie also asked why I have not taken this opportunity to clarify that coal-seam gas is petroleum, and not coal, for the purposes of the Crown Minerals Act. As I pointed out, this matter was deemed to be outside the scope of the bill. However, Ms Goudie will be pleased to know that I will be pursuing alternative means to clarify this anomaly and look forward to National Party support when the amendments come before the House.

In conclusion, I would like to reiterate that the Crown Minerals Amendment Bill will improve the management and allocation of rights to Crown-owned minerals, and ensure that the original policy intentions concerning the transition from the previous regime to the regime under the Crown Minerals Act of 1991 are implemented.

The Minister Mr Duynhoven has just asserted to this Parliament that this bill does not extinguish any property rights. I do not know how he can make that claim, when the court process involved in ascertaining whether licences under the old mining Acts—the Mining Act of 1971 and Coal Mines Act of 1979—can be varied or renewed, is incomplete. The Minister has just told this Parliament that no property rights are extinguished because in the Court of Appeal, in April this year, three judges ruled against Acting Chief Justice Heron’s original decision in 2000. The Court of Appeal argued in that judgment that there was no right under the Crown Minerals Act of 1991 for licences issued under those earlier Acts to be varied or renewed.

💬 Mark Peck: Why didn’t that member fix it when he was Minister?

Dr the Hon LOCKWOOD SMITH: Mr Mark Peck is interjecting from the other side of the House. He should look at recent history. How often have judgments of the New Zealand Court of Appeal been overturned by the Privy Council?

💬 Mark Peck: Why didn’t that member fix it when he had the chance?

Dr the Hon LOCKWOOD SMITH: The member cannot answer. In fact, on commercial law issues the Privy Council has found the New Zealand Court of Appeal to be wrong in over half the cases brought before it. So for the Minister to suggest to this Parliament that the Court of Appeal in disagreeing with Acting Chief Justice Heron in the original High Court case puts this matter at an end, is clearly not the case.

The matter may well be taken to the Privy Council, and may be overturned by the Privy Council, as has been the recent experience. I am told that in 70 percent of cases on commercial law issues where the New Zealand Court of Appeal has ruled one way, and where those cases have been taken to the Privy Council, the ruling of the New Zealand Court of Appeal has been overturned. So for the Minister to come to this House, and say there is not an issue of property rights in this legislation, is clearly mistaken. I am not allowed to say it is “false”, so let me just say it is mistaken. If the Privy Council were to agree with Acting Chief Justice Heron that the transitional provisions back in the 1991 Act did provide for variations to the terms of mining licences that existed, or renewal of mining licences, then property rights are at issue.

💬 Mark Peck: No, they’re not.

Dr the Hon LOCKWOOD SMITH: They are at issue. Mark Peck is rabbiting on, and not even from his own seat. But I do not mind that; let us not stop him. Mr Peck should look at the effect of this legislation. It is so unfair. Anyone who got an application in, who filed a case, prior to when Mr Duynhoven made his statement to expunge property rights—at 5 p.m. on 19 September 2002—may be protected by this legislation. But up until that point, officials had been telling the industry there was no right to vary the term; there was no opportunity for renewal. So a lot of licence holders did not seek to vary the term of their licence. They did not apply for renewal. Their property rights are extinguished by this legislation. Mark Peck knows it and Harry Duynhoven knows it.

That is why National objects to this legislation. It is just so unfair. Those who believed the official advice now face the possibility that their existing property rights will be extinguished. Those who ignored the official advice, and took action, ensured their property rights may be preserved. [Interruption]

The ASSISTANT SPEAKER (H V Ross Robertson): Running commentaries are out of order, under Speaker’s ruling 51/5. Everyone will have a chance to make a speech.

Dr the Hon LOCKWOOD SMITH: Apart from the principle of the extinction of property rights, the fact that this legislation will make null and void the opportunity to vary the term of or renew an existing mining licence, becomes even more important, given the advice the Commerce Committee heard on the mining permit system. What I am told, because I was not there, is that officials examining this legislation could not tell the select committee when the Department of Conservation had ever granted access for a mining permit to Crown minerals on Department of Conservation land. That is a hugely important issue.

If, in fact, the department is preventing access to Crown minerals, under the Crown Minerals Act, then the issue of the possibility of renewal of rights that existed under the old 1971 and 1979 Acts becomes even more important, because the mining industry is an important industry for New Zealand. It seems this legislation could be another nail in its coffin. Labour does not like the mining industry. It thinks it destroys the ground. It thinks it is anti-environment. It does not like it. Yet modern mining can be environmentally very safe, very conducive, with sound environmental outcomes. If I am wrong on that, I want the next Labour speaker in this debate to tell us how many permits the department has allowed for Crown minerals on that Crown-owned land, because I assert that this Government does not like mining. It is making sure that existing licences cannot be renewed, that their terms cannot be varied, with this legislation. I was told the select committee was advised by officials that they had no record of the Department of Conservation approving permits for mining on that Crown-owned land for those Crown-owned minerals.

That is why the National Party is so concerned about this legislation. It is a twofold problem. The first is that the legislation extinguishes any possible rights for people who believed the officials. What is so bad about that is the unfairness. It is so unfair to turn around and say that those who put in an application to vary the term of or extend their licence, prior to 5 p.m. on 19 September 2002, will be all right; they will preserve their existing rights. But those who believed the officials, and did not apply to extend the term of a licence, will see their possible rights extinguished. I stress they are only “possible” rights, because the court process is not completed yet. Those possible rights should be left up to the court to determine. That is the only fair thing, but given that some people have already started that court process, to extinguish those rights for other people treats citizens differently. That is not fair. That is our first objection to this legislation.

As I have said, our second objection is that the legislation really is anti-mining. Since the Crown Minerals Act was passed, and passed in good faith by this Parliament, we have seen Crown-owned land—Department of Conservation land—not being made available, where it is appropriate for mining. This legislation will just be one further nail in the coffin of mining. That is why National opposes it.

That is a typical speech of “never let the facts get in the way of a good story”. I say to the member who preceded me that had National treated its own member Maurice Williamson somewhat better, it might have had good representation at the Commerce Committee. The member was at least upfront enough to say that he had not attended the select committee deliberations on this matter, and I thank him for that. This bill does not extinguish anybody’s rights, and—

Dr the Hon Lockwood Smith: Of course it does.

Well, look, if the member stopped chortling for half a minute and listened, he might learn something. The bill did not extinguish anybody else’s rights either. What the bill does is protect the right of Glenharrow Holdings Ltd to go through the process that it was using, and if it is going to the Privy Council, then its right to do that is protected. That was the Government members’ wish as we were dealing with this legislation, because there were some serious issues involved in whether Glenharrow had a case. If the member does not believe me, I will show him a letter I received from Glenharrow’s legal advisers thanking the select committee for the way in which it conducted its process. I am proud of that because it is a complicated matter.

That member’s party had the opportunity to deal with this when it was in Government. That Government, in dealing with the Ngāi Tahu claim—and not recognising there is a problem with vesting the pounamu to Ngāi Tahu because other miners had rights that had not yet been fully realised—when it dealt with that particular bill set up the grounds for the grievance that we are now dealing with. For him to stand up in the House today and say: “This is a nail in mining’s coffin.”, is being slightly too cute. This is a matter that that Government did not even have the ability to recognise at the time it did its legislation, so we have had to deal with it.

I congratulate the Hon Harry Duynhoven on the action that he took. He took a lot of flak in the media for what he had to do, but it was right for people to be on notice that no further claims would be entertained.

Now let me come to the issue as to whether there is a right. There is a right for Glenharrow to have its issue determined. Its issue is a claim to extend its mining right—not to renew, but to extend. Currently Glenharrow has a 10-year right to extract pounamu. It wants to extend that to 26 years—that is what it wants to do, extend it. It is not about an existing right, but about an extension of a right. Glenharrow has a right to do that under the Mining Act, because that is where it got its first permit from, but Parliament in 1991, when Lockwood Smith was a member of a Government, passed the Crown Minerals Act.

💬 Darren Hughes: He was on the front bench.

He was on the front bench, and at that particular point, it was envisaged that mining in this country would be dealt with under the Crown Minerals Act, not under the Mining Act. There was a change in presumption, presided over by the National Government, around which the transitional provisions were not clear. This is why we now have the conundrum we have in the courts. Those who have action pending before 22 September, which I think is the date—

Dr the Hon Lockwood Smith: The 19th.

Sorry, 19 September 2002. They have their right to have those issues determined protected, but no one else—a total of three people. That is as it should be, because Parliament is right to pass law, and is right to set up new regimes.

And that is the other competing principle. The other competing principle is whether Parliament has the right to make laws to alter things. Let me say that Parliament has jealously guarded that particular right, not just in this Parliament but also for centuries. Of course Parliament has the right to change the law so that other issues around the granting of mining licences are taken into account. Let me tell members one. If minerals were found under my house, I think I as the landowner have the right to question whether my peace and quiet and occupation of that land should be disturbed by mining. People now have a right to object when mining is undertaken.

In concluding on these particular matters I come back to the issue of Ngāi Tahu. One of the reasons we dealt with the Ngai Tahu (Pounamu Vesting) Bill and the Ngāi Tahu Claims Settlement Bill for Ngāi Tahu was that their property rights were expropriated by Pākehā some 100-odd years ago. This nation was determined that that expropriation needed to be tidied up, and it has been tidied up in those two particular pieces of legislation. Ngāi Tahu has the right to manage its mineral deposits of pounamu. It is now up to Ngāi Tahu as to what arrangements it will enter into with whatever mining companies that might be interested in extracting pounamu, if any. The people of Ngāi Tahu themselves may want to enter that market and may want to form partnerships to do so. That is their right. It is their right simply by customary use and practice, which have been around for a long time.

This is a good bill. The Minister did what he had to do. Those who had rights under the Mining Act and who were seeking to use their rights in accordance with the transition provisions have had those rights protected by this Government. I congratulate the members of the select committee who got their heads around the matter, and I congratulate Glenharrow and Ngāi Tahu on the way in which they dealt with this very difficult issue as this bill has progressed.

My contribution will not be long, because I was not on the select committee. My knowledge of this bill is what I have received in my briefing from my colleague Brent Catchpole, who has detailed knowledge of this issue but unfortunately could not be here this afternoon as he is away on other parliamentary business. I have gained further personal knowledge from what I have read of the bill and from outside literature.

New Zealand First cannot support this bill. I listened intently to Mark Peck, who is an MP whom New Zealand First regards as a straight shooter—as it does the Hon Harry Duynhoven. They do not play the political game terribly often, and we believe that they address the issues, in general terms, pretty forthrightly. But I think they have got it wrong and that this legislation is not doing the job it should be doing.

I accept what Mark Peck said—that previous legislation did not address mining issues clearly. That is putting it as bluntly as I can. I would like to suggest to the Government that this might clarify the situation, but it does not address mining issues fairly. I note that the last clause in a 7-page document talks about no compensation. New section 119A in clause 24 states: “No person is entitled to compensation from the Crown in respect of any losses arising from—…”. It is not necessary for me to read out the rest of this new section. It implies that people in this industry will lose, and the Government is accepting of that.

💬 Hon Harry Duynhoven: No windfall claims!

It goes a little deeper than that. Let me quote—

💬 Hon Harry Duynhoven: Don’t quote from the Independent.

That is exactly what I am going to do.

💬 Hon Harry Duynhoven: The Independent ran the most biased series of articles.

Maybe it did, but this is a sentence I must read to the House because this is absolutely shooting straight from the heart. It states that the Crown Minerals Act is “essentially anti-mining, anti-private enterprise legislation”, and that it “doesn’t recognise the miner’s need for security of tenure.”

💬 Hon Harry Duynhoven: Passed by the National Government.

That may be so, but I suggest to the Minister that he does not have it right. He might have clarified what he thinks the National Government should or should not have done, but he has not put legislation in that is fair. After reading something like that—that is, that the Crown Minerals Act is “essentially anti-mining, anti-private enterprise legislation”—Government members should take that on board. That was reported in the Independent newspaper on 16 April 2003. After reading that, Government members should ask: “Have we got it right?”, because this is a Government that prides itself on being pro - private enterprise.

💬 Pansy Wong: What?

Yes, it does! Government members talk to business people. Did the member not hear the questions in the House—patsy questions, I admit—this afternoon? The questions were trying to give the impression that this Government is pro - private enterprise. The Independent states that this legislation is anti - private enterprise and anti-mining.

We could take huge advantage of the mining industry, with huge economic gains and benefits for this country not only in employment but also in all other ways. However, there has to be a proviso. There has to be some stipulation that the mining fraternity look after the environment—in other words, it leaves it in the same pristine condition that it was before the industry set about mining in a particular area.

We are disappointed in this legislation. We believe there is an underlying problem here, but we do not believe that this has been addressed properly or fairly. When we do not have fair legislation, then we get legislation that does not sit comfortably with the public. There will be amendments. If I heard the Hon Harry Duynhoven correctly, he alluded to that in his speech, and that he expects amendments for this bill.

💬 Hon Harry Duynhoven: With regard to coal and methane.

I missed the content because a lot of talking was going on. I suggest to the Minister that there will be amendments in mining-type legislation before too long. New Zealand First cannot support this legislation. With the best will in the world we cannot support this.

In my contribution to the second reading I outlined the reasons United Future is not able to support this bill as it stands. As I said at the time, it is not so much that we object to the content of this particular bill, but we object rather to the overall Crown minerals framework that exists under the Crown Minerals Act. We are concerned with the overall environment that exists in New Zealand in relation to the mining of Crown minerals. We are concerned that mining companies, and in particular those situated overseas, are bypassing mineral prospecting in New Zealand in favour of overseas countries that have established far better, more practical, and more workable prospecting and mining regimes.

I take no delight in reporting to the House that representatives of one international mining company said to me recently that New Zealand now rates in their mind in terms of ease of access and certainty of process and fairness, alongside politically unstable regimes in Africa; on the other hand the advantage of those regimes in Africa is that they are very open to bribes. I was staggered to find New Zealand categorised in that way and asked questions in an endeavour to establish why such negative perceptions exist. I will endeavour to summarise the position as mining companies see it so that these matters can be clarified in the interests of public debate and the development of this country.

Let me say at the outset that New Zealand can kiss goodbye to returning its economy to the top half of the OECD if in areas such as hydro-electricity generation, Crown minerals mining, and tourism facilities, the international community has formed the view that this is a risky country in which to invest. The simple truth is that if we discourage sensible development in New Zealand, then we will get less of it. The other side of that public policy maxim is also true—namely, that if we encourage it as an activity we will get more of it.

Let me outline the problems. The first, as I mentioned in my second reading speech, is that we have a major systemic problem because one-third of New Zealand land, plus the majority of our rivers and lakes, are owned by the Crown but are administered by the Department of Conversation under the Conservation Act. We must not delay a review of the way that that Act is being administrated. In reality, from inception it should have dealt with land management issues and have been broadened out to ensure that such management has as one of its aims the enabling of people and communities to provide for their economic well-being. When we talk about sustainability, we can all too easily overlook that we must provide the means, wherever possible, to enable local people and their communities to become economically self-sustaining through the use of local resources. I am an environmentalist and a conservationist, but we need to continually ask ourselves the question: what is the ultimate value that we are trying to achieve? As Māori rightly say: “It is people, it is people, it is people.” How foolish, then, to take more than one-third of the total area of this country willy-nilly, place the label “conservation” on it, then padlock it away with an enormous billboard saying: “No mining, no hydro, no tourism facilities.” That is not good enough, and the matter needs to be urgently addressed.

I hope, for the benefit of New Zealand and its people, that I do not have to go on repeatedly pointing out the problem before corrective action is taken. Some might say I am exaggerating the situation. However, if I were to take as an example the Macrae mine near Reefton, which may eventually be able to be progressed, and go through the whole sorry saga of that particular example, we will find that it proves what I am saying. In that situation there was no certainty of process, no time lines were established, and the Department of Conservation plus the Minister of Conservation were simply able to delay and delay and delay.

It is exactly that kind of result that sees New Zealand given a Third World label. No one in his or her right mind is prepared to outlay the resources—and we can be talking millions of dollars—and engage with the Department of Conservation, as long as that situation continues. It is time consuming and exhausting. It is difficult to envisage anything worse than a very expensive, long, uncertain, non-transparent process. That is exactly what we have in New Zealand at the moment when it comes to Crown minerals. Mining is not prohibited on the Department of Conservation estate—national parks excepted—but it almost might as well be.

The second major issue in relation to the Crown Minerals Act that, I believe, needs to be addressed is the function of the Minister of Energy and the Ministry of Economic Development in relation to Crown minerals. At present they are not empowered to advocate for and manage the Crown-owned minerals estate. Accordingly, especially when dealing with the Minister of Conservation and the Department of Conservation, the position lacks any kind of ministerial symmetry. That is extremely important when specific mining possibilities go to a hearing under the Resource Management Act. The whole weight of the Minister of Conservation and his department stands against, often, the mining company, and very often also against the wishes of the local community who believe their economic well-being will be advanced if mining were to proceed.

The perception, and more often than not the reality, in that situation is that the local authority and, if it goes to appeal, the Environment Court, give undue weight to just the conservation side of the argument. The dice are loaded against the mining company and the local community by the whole weight of the State and its limitless resources. It would be a great improvement, in my view, if the Minister of Energy and his department were there also to balance out the process in relation to the Crown mineral estate. After all, we must not forget that finally it is the Crown that owns the minerals themselves, and it is the Crown that gives the mining companies the right to extract those minerals in exchange for royalties, etc. In one sense, therefore, we could say that the Crown itself is being negligent in relation to its own assets—assets that it effectively holds in trust for the benefit and the welfare of the people of this country.

The value of minerals in any particular situation should not be overlooked. As pointed out by the Hon Ken Shirley in the second reading debate, it is estimated to be in the tens of billions of dollars, in the case of gold, but, of course, potentially, even greater sums of money may be involved with oil and gas.

I repeat what I previously said. Extraction of Crown minerals need not necessarily be at the expense of the conservation estate and its value. Indeed, the overriding criteria should, in my view, remain net benefit to that conservation estate—a win-win situation. I hope we might yet see the Government begin to move in that direction, and I am encouraged by recent initiatives by the Minister of Conservation that he is prepared to begin dialogue with United Future.

It was interesting to listen to the speech made by Gordon Copeland of United Future. He might be able to see a ray of sunshine coming through in terms of whatever dialogue United Future will engage in with the Labour Government over a more positive future for the mining industry, but I have to say I remain very sceptical. I remember that before the 1999 election, the Hon Paul Swain, who was an Opposition member at that stage, did indeed engage the mining industry in dialogue, and promised that Labour, if it was elected, would actually develop a strategy for the mineral industry, but I have yet to see that eventuate.

It was absolutely right for my colleagues Dr the Hon Lockwood Smith, and Peter Brown of New Zealand First, to point out that this legislation definitely sends the very clear message that this Labour Government is anti the mining industry. That was reinforced by the members of the mining industry when this bill was first introduced into the House in 2000, just before Christmas. I was on the Commerce Committee at that stage, and members of the mining industry brought to our attention the lack of proper consultation with them. They were told when the bill was in preparation that it was being brought in to adjust, or to correct, or to amend administrative technical matters relating to the administration of the Crown mineral estate. So it was to their horror that, just at Christmas in the year 2000, this bill was brought in to extinguish the right of mining licence holders.

Let us reflect back a little bit. For 9 years, since 1991 to the year 2000, when Glenharrow Holdings won its case in court, the mining operators were repeatedly told by the officials of the Crown mineral section within the Ministry of Economic Development that their rights for renewal or variation were extinguished. So they were entitled to take the advice of those officials as being right, and many of them did. But Glenharrow has never given up and engaged legal counsel, who did not believe that that was the intention of the legislation passed in 1991.

Glenharrow won the court case. I was surprised to hear the arrogant tone used by Mark Peck, the Labour member of Parliament in his speech a few minutes ago, when he indicated that Glenharrow and others should be grateful that the Labour Government has brought in this legislation, as if this Government is granting some favour to Glenharrow and others who had lodged their applications prior to 5 p.m. on 19 September 2002.

I ask that member to reflect on that attitude, which, I think, is typical of a very arrogant, anti-mining Labour Government. Glenharrow and others have fought long and hard to have the fruits of victory, and of course they should be allowed to keep them. But what happened to the many others who, over many years, listened to the advice given by the officials and did not act in time to have their property rights protected? Not only had proper consultation not been carried out on this legislation, but it got worse when this bill was referred to the Commerce Committee.

Before the committee members had had time to deliberate on the legislation, the Hon Harry Duynhoven, through a press statement, announced another time line to extinguish the property rights. They were to expire at 5 p.m. on 19 September 2002. So, many operators who had the intention of applying to renew their licence and who were waiting for the outcome of the deliberations of the Commerce Committee, were dealt another blow.

I thought all the Ministers, apart from Harry Duynhoven, might not have been as sympathetic to those licence holders. Surely we would have expected, particularly in recent weeks, Harry Duynhoven’s understanding of the frustration, when a piece of legislation was found to contain provisions that were not to his advantage. The Labour Government never lost time in bringing in urgency to fix a piece of legislation for one of its own members of Parliament, but it did not extend the same sympathetic attitude towards the licence holders of the mining industry.

I also want to talk a little bit more about the lack of consultation on this bill. I brought up this point, because in recent weeks we were reminded by the Minister of Local Government, the Hon Chris Carter, of the importance and necessity of consultation. Day after day in Parliament he lectured local government—in this case the Auckland Regional Council—for not consulting properly its ratepayers, and insisted during the passing of the Local Government Bill in June this year that extensive consultation should take place with the ratepayers before local government could implement any legislation.

I thought it was a bit rich for a Labour Minister to lecture local government on the morals and merits of consultation, when the Government brought in legislation that had serious consequences on licence holders and extinguished their property rights. Indeed, they were not even given the opportunity to be consulted in the first place. Then when this legislation was being considered at the Commerce Committee, another time line was brought in to end their rights once and for all.

So I would not exactly say that this legislation is a shining example of the Labour Government trying to demonstrate that it respects the process of consultation. I also reflect on the fact that if the commencement date of time lines is being brought into legislation during the select committee process, what is the point of this House debating, in Committee, the commencement date and other related matters? Therefore I think that today is another very sad day for the mining industry, which should get the message by now that this Labour Government is absolutely anti-mining.

Listening to the speeches from the other side of the House, one would have thought that National, during its time in Government, had got the mining legislation perfect. That is hardly the situation at all, which is the reason we have this bill in front of the House at this moment. This bill makes a number of amendments that will improve the management and allocation of rights to Crown-owned minerals. The mineral industry is important to New Zealand, and it makes a significant contribution to regional economies. I want to say quite clearly that this amendment will not deny mining licence holders continuing opportunities to mine Crown-owned minerals, and mining licence holders will still be able to apply for a mining permit under the Crown Minerals Act. I support this bill, and, as I frequently say, the quicker we get it passed the better it is for the mining industry.

We are debating the third reading of the Crown Minerals Amendment Bill, which stands in the name of the Hon Harry Duynhoven—recently returned to this Parliament under urgency by his colleagues, with a vote majority of 5.

💬 Phil Heatley: By the skin of his teeth.

The lowest majority in this Parliament! That was a disgraceful episode. I raise that matter not to get at Harry Duynhoven at all, but to point out that this is butt-covering legislation. It is retrospective, butt-covering legislation, which has become the wont of this Labour Government. Whenever there is a problem or something messy, or whenever the courts make a decision the Government does not like, it rushes into retrospective, butt-covering legislation. We have here a clear High Court decision—I refer to the Glenharrow Holdings Ltd v Attorney-General case—that the Government did not like, so, on 19 September 2002, by Government decree, the Minister acted in a way that retrospectively cancelled property rights. The Minister, we heard, possibly should not have been in Parliament under the vacancy clauses of section 55 of the Electoral Act, but, be that as it may, I believe he acted in a very disgraceful manner, and now we have this retrospective, butt-covering legislation.

The Government calls the legislation a review of the Crown Minerals Act. I believe that the management of Crown minerals in this country has been disgraceful for a long time and I regret that a National Government brought in the Crown Minerals Act in 1991, which was fundamentally flawed. My regret is that this bill does not address those fundamental flaws in any way whatsoever. Here was an opportunity to give a bit of encouragement to the mining industry, and I do observe that Harry Duynhoven is a champion of the mining industry. He believes in it, but unfortunately the majority of members in his party do not share his belief. They are anti-development and anti - wealth creation—unlike that Minister who appreciates those things. Of course, at every turn they try to nationalise everything and kill any initiative to create wealth in this country.

One of the real problems, and it does relate to this bill, is the lost opportunity we had in the New Zealand mining industry. I repeat again that a very good report from the Institute of Geological and Nuclear Sciences Ltd in 1999 showed we had, in those dollar-of-the-day value terms, $86 billion worth of mineral wealth in this country. What has happened? Predominantly, it is all tied up under the Department of Conservation estate. Over 80 percent is under land in the Department of Conservation estate, and, unfortunately, the Crown Minerals Act effectively gave the landowner veto rights on access terms. So, since 1991, how many access grants has the Department of Conservation, as an agent acting on behalf of the Crown, granted in that huge area—the over 80 percent of land under the Department of Conservation estate? I have asked that question, and the answer is—not one. I have asked Ministers in the chair to name one and they have consistently failed to cite or name one Crown grant made by the Department of Conservation.

There are some appalling examples in which developments have been frustrated. We know of the Macrae’s Mining Co. situation in Reefton where a very promising gold potential has been severely truncated. I ask the Minister, who is in the House now, about the Pike River coalfield, which is a major development for New Zealand, with premium coal—a big export earner—and wonderful coking coal for steel production when blended with other coals. Everyone is geared up for major development in that field, and it is hugely important to the West Coast and to the economy at large. The Pike River Coal Company has its resource-use consents, but the Department of Conservation will not grant it access over a few hectares of land. Under the terms of what is sort of a net conservation benefit, the company is prepared to buy up and grant to the department whole catchments of prime, pristine conservation lands, but the department will not give it access to a few hectares of land, even when there will be insignificant environmental impact.

That is an appalling situation, but unfortunately it happens right around the country. Under a National Government, mining was closed down in the Coromandel area, and I regret that. That resource-rich area of Coromandel is locked up, and, as a country, we are turning our back on that mineral wealth. National members here should reflect on that; that was a bad decision. It was a wrong decision, and we do not want to see any more.

We are not a wealthy nation and we should be using our mineral resources. Potentially we have a very good mining industry in this country. A single gold mine at Macraes Flat, just out from Palmerston, is owned by GRD Macraes. The member for Otago is here and I am sure he knows that company very well. It is a very responsible mining company using top technologies. How many members in the House appreciate that that one mine earns more export earnings for this country every year than the whole of our wine industry? I am not knocking the wine industry. We have a splendid developing wine industry here doing well, and I applaud that. It has a high profile, but how many people realise that that one mine produces more wealth in export receipts for the country than the total wine industry, including the Gisbornes, the Marlboroughs, the Hendersons, and the whole lot? Not a lot of people would have realised that. That same example is across this whole country.

We can take the example of the wealth of Australia. Over 50 percent of that country’s export receipts come from three minerals—coal, gold, and uranium. Yet this country, with its foolish policies, blocks access for a responsible mining industry.

Let us remember our early pioneering days. It was the gold rushes of Otago and of the Waihi areas that let this economy take off. Yes, very crude, unsophisticated techniques were used in those days, and significant environmental damage occurred, but one cannot see that today—it has been totally repaired; nature repaired itself. The modern mining industry is responsible. It has minimal impact on the environment, and the net conservation benefit that can accrue from generating that wealth, from mobilising those resources, far outweighs the very limited damage that can be created, which can be offset.

I say to Government members that they should not come to the House with minor tinkering, with butt-covering retrospective legislation for ministerial decrees, when they should be addressing the fundamentally flawed inadequacies of the Crown Minerals Act, so that we can once again have a proud, flourishing, and prosperous mining industry in this country.

The Crown Minerals Act was passed in 1991, and it repealed the prior 1971 Mining Act. At that time, virtually everybody believed that no applications for renewal of 1971 Act mining privileges, or for extension of their terms, could be made. That view was commonly held throughout the mining industry, as was demonstrated by publications to that effect issued by the mining industry itself. In the last year or two an anomaly was discovered through the efforts of Glenharrow Holdings, which exploited—as it was legally entitled to do—an unexpected outcome of the legislation.

The move from the Mining Act to the Crown Minerals Act occurred in the first place because of the age of the Mining Act. Were it still in force, it would be over 32 years old. It had not moved with the times. The big change was to the rights of owners. The rights of owners whose land was to be mined were significantly improved under the Crown Minerals Act. We have heard a lot of talk today about land and the Department of Conservation estate, but the more important thing for most private property owners is that the Crown Minerals Act gave them the right to refuse permission for people to mine their land. Private owners would be very concerned if this remedial legislation were not passed, as it brings some of those old, expiring Mining Act privileges to an end, and that means they can assert their private property rights. I am surprised to hear the National Government arguing, effectively, against the private property rights of people whose title to land is presently undermined—figuratively and literally—by mining that is occurring.

This legislation does not strip Glenharrow Holdings of the fruits of its judgment. It does not cause any unfairness to any party. The process of all of those who have made applications to try to take advantage of the gap in the law that Glenharrow Holdings spotted is being protected, as well. This new law will apply to anyone who had not applied by the time the Minister announced his intention to pass remedial legislation, but it is my submission to the House that that is not at all unfair. I recommend the legislation to the House.

I too rise to make it clear that National opposes this bill, which we refer to as the anti-mining bill. I cannot do much better than Pansy Wong, who said on 21 December 2001 that, in the face of a considered High Court ruling, the legislation was an appalling use of executive power by an anti-business Government, which dislikes the mining industry. That best reflects what people in the National Party are saying, and, certainly, what people out in the wider community are saying.

By way of recap, I would like to clarify that this bill has arisen out of the High Court case Glenharrow Holdings Ltd v Attorney-General, which held that the principal Act did not extinguish the right of mining licensees to apply for a new mining licence or for an extension of their existing licence. The High Court said at one time that it did; again, it put that in doubt. The Court of Appeal said it did not, and now there is an opportunity for the Privy Council to rule. So court business has not yet been finished, yet this Government has taken the opportunity to legislate and ride roughshod over those good miners in operation.

Those people involved with Glenharrow Holdings, and others, who did not believe officials and take their advice, but who instead put in applications for mining licences, have gone to court, and have got through. We are pleased about that. They will continue with their successful mining businesses. But what is unfair about this bill is that those who did believe officials and did take their advice have been blindsided by Harry Duynhoven and his announcement on 20 September 2002. They have been put in a very difficult situation whereby their businesses and their future business interests in mining are, clearly, under threat. As I said, they have been blindsided by the Minister Harry Duynhoven, who is known as the Abel Tasman of the Labour Party because he came to New Zealand for a little while, did not like it, and went home.

Under the Crown Minerals Act, the Government issues mining permits, not mining licences that incorporate property rights. This bill prevents mining licensees from renewing their mining licences under the now repealed Mining Act and Coal Mines Act. As a result of this amendment, those miners must now reapply under the Crown Minerals Act, not the Mining Act or Coal Mines Act that they originally applied under.

Members will recall that in the first reading, the Minister Paul Swain said that the proposed amendments will not be retrospective. He said that any mining licence variation application received before the amendment is enacted will be accepted in the process under the current regime. Yet new clauses 22 and 23 appear, on the face of it and under intense scrutiny, to contradict what the Minister said in that first reading speech.

I bring members’ attention to those clauses. New section 111 in clause 22, “New section 111 substituted”, states: “(1) If, after 5 pm on 19 September 2002, a holder of an existing privilege makes an application to which any of the enactments specified in subsection (2) would have applied if this Act or the Crown Minerals Amendment Act 2001 had not been enacted, then, despite section 107,—(a) the Acts specified in subsection (2) do not apply in respect of the application; but (b) this Act ... applies in respect of the application as if the existing privilege were a minerals permit of the appropriate kind.”, meaning that someone who had not trusted the officials, and had put in an application prior to 5 p.m. on 19 September 2002, would be home free, but someone who had taken the advice of officials, and had not put in an application, instead counting on the altruistic tendencies of Harry Duynhoven, would be severely caught out and his or her business would now be under threat.

Again, new section 111A in clause 23 states: “(1) No extension of the duration of a mining privilege may be granted on an application for a variation of conditions under section 103D of the Mining Act 1971 made after 5 pm on 19 September 2002.” Under that provision too, someone who had not trusted the officials or the altruistic qualities of Harry Duynhoven, and had put in an application, would be home free, but someone who had trusted them would be caught out.

As I say, the Hon Paul Swain’s statement in his speech on the first reading, about the amendments not being retrospective, is clearly contradicted by clauses 22 and 23. I was disappointed that Harry Duynhoven did not address that in his opening speech. He was not prepared to go back and clarify what had been said in the past, which people had put great hope in, putting at risk their business future. He did not address that or rise to apologise.

Since 1991—other members have referred to this—there has been a much tighter process, which has resulted in miners being denied access to the conservation estate by the Department of Conservation. Mr Copeland, whom we hold out hope for, and Mr Shirley, who has proved his worth over recent years, have already alluded to the fact that New Zealand is actually locked out of utilising many, many minerals. It is interesting that the bill is called the Crown Minerals Amendment Bill, because the Crown, in the form of the Department of Conservation, has all the minerals. No one else has them. It is certainly not the “People’s Minerals Bill” or the “New Zealanders’ Minerals Bill”, because we cannot get at them; the Department of Conservation has them all. It is locking up large areas of this country from being used for tourism, mining—as we have heard, 80 percent of Crown minerals are locked away by the Department of Conservation—and hydro-electric power, and now it is using marine reserves to lock the country out of fishing, as well.

It is unfortunate that the Department of Conservation is taking that approach and not sticking to its knitting. If the Department of Conservation ran around the country killing more possums and looking after its land, the country would be in a much better state. In fact, we have a saying in Northland, and Mr Shirley might be interested in this; farmers who have farms next to Department of Conservation land in Northland say that if they kill a possum on their farmland, 100 more turn up to its funeral. Do members know where they come from? They come from the Department of Conservation land. My message to the Department of Conservation today, and throughout my speeches on this bill, is that it should stick to its knitting instead of locking up so much land against the wishes of many, many New Zealanders.

This bill does not satisfactorily deal with the difficulties of balancing the interests of the economy and the mining industry against those of the environment and conservationists. The bill is sponsored by Mr Harry Duynhoven, the Abel Tasman of the Labour Party. It is a bit ironic that he is passing a bill to retrospectively take away property rights, in the light of issues brought to us in recent weeks. It is sad to say that, under clause 24, no compensation is offered, even though that clause clearly states that these miners lose three rights: the right to apply for new licences under either the Mining Act or the Coal Mines Act, and the right to apply for extensions of durations. I am disappointed with this bill, and the National Party will certainly be voting against it.