Communications Legislation Bill

Part 1 of the Communications Legislation Bill is, in fact, a very short-focused part. It states that it will extend the 5-year time line that the Government set up in 2001 to enable 12 communications services to be so-called designated—that is, services are to be regulated by the Commerce Commission. But let us reflect on that, because in 2001, when the Government assigned those 12 designated services, the Minister of Commerce at that stage was the Hon Paul Swain. He actually said, no ifs, no buts, that in 5 years’ time those 12 designated services or issues related to that would have been dealt with, but today we are standing here, 5 years later, extending 10 out of the 12 designated services.

Well, I invite the Minister in the chair, David Parker—I do not know how many Ministers there have been since, but there is now another Minister in the chair—to take a call and explain to the public why, after 5 long years, we are here debating again the extension of 10 out of the 12 designated services. What happened in those 5 years? What happened to the certainty and the orderly market that was promised by the Hon Paul Swain? That was why National supported this measure 5 years ago. We were told that in 5 years’ time all the issues relating to those 12 designated services would be sorted out.

National, reluctantly, will support this legislation because we do not want to cause further uncertainty by denying the sector this legislation. But I think that the Hon David Parker still owes it to the public to take a call to explain why, with the passage of 5 long years, we are here tonight in this Chamber debating the extension of time. What confidence do we have that this issue will be sorted out once the time period has been extended? Well, in fact, yesterday the Commerce Commission announced further that, even though the commissioner has a lot on his plate in sorting out the telecommunications industry, he has decided he will take on another investigation—into the mobile phone market.

So while we are debating this legislation, one cannot help thinking how many times we will be summoned back into the House and to the select committee to continue to do a patch-up job, because the Government in the first instance, obviously, has not got it right. That has already been well demonstrated in the bundling and unbundling issue, which has been a flip-flop and a U-turn all along the way.

So I ask whether the Minister in the chair could take a call and give the public some reassurance that, with the cooperation of the National Party, we will not be back in the House again, having to support further time extensions just because this Government is incompetent in terms of charting a way forward for the telecommunications sector. In effect, we have seen very little progress in the last 5 years on giving certainty for the operators in the telecommunications sector.

I do not think that the Minister should just sit there waiting for us to ask the question and not give the public the benefit of knowing that cooperation on this legislation will lead to some real commitment on the part of the Government to make sure that an extension will not be further required. In fact, among all the submissions, we had only one—I think it was from TelstraClear—that supported the bill.

I am very pleased to follow my colleague Pansy Wong to make a contribution in the Committee stage of the Communications Legislation Bill. As we indicated right at the start, we support the amendments being proposed here, but I do echo my colleague’s call to the Minister. We have a different Minister in the chair tonight, the Hon David Parker, but we have become used to that over the last 5 years—there has been one Minister after another, with no Minister actually delivering what he or she said would be delivered. It is only fair, as my colleague has said, that this Minister takes a call to explain to the New Zealand public why it is that, 5 years on, the time line the Government sought back in 2001, which National agreed to, is now insufficient.

Part 1, as we know, amends the Telecommunications Act. The amendments will prevent the early expiry of the regulation of 10 particular telecommunications services. That is a reasonable thing to do, but it is not reasonable that 5 years on, in an environment where it is absolutely essential to have stability and certainty, we are now back in this Chamber to agree to an extension to 7 years, with no explanation. The Minister needs to stand up tonight and reassure this Committee, the market place, the consumers out there, and those who rely on a stable regulatory framework that within 2 years this Government will be capable of not only setting the pathway forward—and making that clear—but also implementing it.

This Minister has shown in the House, particularly during question time, that he loves getting to his feet, so let us see him get to his feet tonight. He likes to give an indication that he knows everything, so let us see whether he does know everything, and let us see whether he can give an assurance tonight that the extension we are now agreeing to—from 5 years to 7 years—will be sufficient, and that within that extension the Government will get the job done that it indicated it would do in 2001. It is not good enough, at all. I ask members to think about the Government’s record in this whole area. We still have the unbundling bill before the Finance and Expenditure Committee, and, gosh, the way the Government has dealt with that issue has been a chaotic mess. It has changed its mind and sacked messengers, all over the place. That is the history of this Government—it is not a good way to conduct business.

This Government—and particularly the Prime Minister—is great at making reference to the transformation of the economy. The delays and the tardiness of the Government in the communications sector certainly gives no confidence that this economy will be transformed any time soon. We know that, but we have put a little bit of faith in the Government tonight by supporting these amendments, and we have put a little bit of faith in the Government to get things moving and lay the building blocks for transforming the economy. But, so far, I have not seen any building blocks laid, at all—not one. There has been a lot of talk since 2001, but no secure building blocks have been put in place to transform the economy.

Time is running out for this Government. Of course, that is good for the Opposition—we are very happy with that. Labour has had its turn; it will be gone in 2 years’ time, and rightly so. It has not been able to give us any certainty and stability in this critical area of infrastructure. It is interesting that the Government has asked for 2 more years to extend the period of regulation. It must know that it is going out in 2 years. National has no confidence whatsoever that the Government, having set a time line of 5 years, will now complete the review in 2 years.

Unlike my two distinguished predecessors, Pansy Wong and Georgina te Heuheu, I do not have their long background to give a historical view on the Communications Legislation Bill. But when I saw it on the Order Paper and realised that I usually speak on anything that has the whiff of a bipartisan approach—whether in respect of trade, arts, culture and heritage, or whatever—I thought: “I know that the whip will pick me to take a call on this item.” So I guess I have to apply the great democratic process to the matter of the efficient regulation of the electromagnetic spectrum.

It is on occasions like this that I and others have to remind ourselves that in the past people have literally died to preserve my right to speak on the efficient regulation of the electromagnetic spectrum. I must say that if any of those souls who paid the ultimate price are, in some sense, listening to this debate tonight—way up there above the upper troposphere, in some ethereal sense—by the time they have finished hearing my intervention they may have regretted their decision.

The great challenge for members coming to this topic brand new is to say anything remotely new, remotely interesting, or even vaguely controversial or provocative about the Communications Legislation Bill. It has been extensively described as a small and technical bill—and we are not referring to the official in the cardigan who wrote the bill but the bill itself. It is clearly deeply uncontroversial, so can we relate it to the everyday concerns of our electorates? Well, if we stick to the Standing Orders and the purpose of the bill, the answer is: only with difficulty. But there is one exception, and it relates to the matter of inappropriate receivers.

New Zealand is actually the second-largest market in the world for the import of second-hand Japanese cars. We used to be the largest market in the world, until the trade between Vladivostok and Osaka and Tokyo really took off, and Japan discovered that the much larger population of Russia was also in the market. I myself have benefited from this for a little over a year. I got a nice little motor, with 93,000 kilometres on the clock. It has done me very well, but I have had one problem—that of the inappropriate receiver on my motor vehicle. Until I started to research this bill, about an hour and a half ago, I had put this down to a combination of my, at best, only average techie skills, plus the fact there was no instruction manual in the glove box of the car when I bought it. As any other member who has bought an imported Japanese car will know, since the instruction manuals are in Japanese, manufacturers rarely bother to include them for the average New Zealand consumer.

But now I know that the problem was not due to either of those reasons; rather, it is technically impossible to accurately programme those inappropriate receivers. So I spent a lot of time pushing buttons, dialling knobs in Auckland—like other Aucklanders, though I myself probably would be more accurately described as a weather refugee from Wellington—trying to tune into classic rock FM, Flava, Planet FM, or the wonderfully named Wicked Latino. In fact, it is technically not possible to do that. So it might be a tough decision, in a sense—

💬 Maryan Street: I raise a point of order, Mr Chairperson. Can you clarify whether we are currently debating Part 1 or Part 2, because I think the member is speaking to Part 2—for all his research.

The CHAIRPERSON (H V Ross Robertson): We are, in fact, speaking to Part 1. The member should address that. I thank the member for bringing up that point. We are debating clauses 3 and 4.

The basic thing is that we support the bill. It is a very small technical step. It is something that has to be done in a sensible way. We have no particular problem with the way this issue has been approached, although we wonder sometimes why the Government has taken so long to get around to it. I will be speaking to the other matters later on, at later stages. Thank you.

I rise to speak to Part 1—

💬 Darren Hughes: Showing up his own colleague.

—and to add to the wonderful comments of Mr Tim Groser, who, I might add, spoke exceptionally well the other night in my electorate of Napier when addressing members of Rissington Breedline. He did a fantastic job, and I thank him. Part 1 deals with the expiry of designated services under section 65 of the Telecommunications Act 2001. We are dealing with an omnibus bill. Part 1 amends the Telecommunications Act and Part 2 amends the Radiocommunications Act 1989.

Before I debate Part 1 in any detail, I refer to a quote made by Minister David Cunliffe when he introduced the bill. He said: “This bill maintains a commercial environment of certainty and confidence for both telecommunications services and use of the radio frequency spectrum.” Well, that is why National is supporting this bill, because we see that it maintains some certainty. But if one puts that statement into the context of David Cunliffe’s announcement about recent changes to Telecom, one would argue that he has his wires twisted somewhat, because he managed to wipe a couple of billion dollars off the value of Telecom’s shares in the space of a few days. I would argue that that does not give certainty and confidence either to shareholders of Telecom or to potential future investors in this country.

In focusing back on Part 1, I say we are talking about a largely technical measure. It is designed to prevent an unintended consequence, and it deals with some timing issues. The bill is narrow in scope. Part 1 is extremely narrow; it deals with one issue. Part 1 amends the Telecommunications Act by extending by 2 years the regulation of 10 of the 13 telecommunications services that were originally regulated under the Act. Clause 4 lists a number of examples: in new section 65(1A)(a), interconnection with Telecom’s fixed public switched telephone network; in new section 65(1A)(b), interconnection with fixed public switched telephone networks other than Telecom’s; and going right through to new sections 65(1A)(g) to (j), dealing with local telephone number portability service, cellular telephone number portability service, national roaming, and co-location on cellular mobile transmission sites.

I have had a fair bit to do with the last four of those items in terms of the Telecommnications Amendment Bill, which we are examining in the Finance and Expenditure Committee. Those issues will have a big impact on the telecommunications environment going forward, particularly as New Zealand tries to get more competition into the mobile phone market place. That was highlighted by the flamboyant figure of Tex Edwards from Econet, who came before the select committee and talked about his struggle to get his company up and running, despite, I might add—

💬 Darren Hughes: Whose fault was that?

I take that on board, entirely. The select committee, to a T, turned around to Mr Edwards and put the blame where it was due: back in Mr Edwards’ court.

I acknowledge the work of former Minister Swain, who had a fair bit to do with the 2001 bill at that point in time, and who gave new competitors the opportunity to get into the market. But they had to establish that they could get 10 percent coverage before they could get national roaming and co-location on sites around the country. That was good legislation, because a company like Econet had to establish a level of investment in the country. Even though Econet has invested about $20 million - odd—although I could be corrected on that—into spectrum to buy its rights and although it has coupled up with a local iwi trust, it has not made the investment that is needed to go forward. So I would be interested to hear the Minister’s view of the extension of these designated rights for 2 years, of how that impacts on a company like Econet, and of whether that company would still have the opportunity to follow through—if it ever does.

I would like to contribute to Part 1, which amends the Telecommunications Act, and particularly clause 4, “Expiry of designated services and specified services”. I must say it is with some disappointment that the National Party sees that the Minister in the chair, the Hon David Parker, through lack of leadership, has now got a situation where the Commerce Commission has to have 2 extra years to deal with the complexities of the 10 provisions in clause 4.

The Minister might see that as some source of amusement, but I can tell him that there are constituents, citizens, right throughout this country—they do not measure in the hundreds, they do not measure in the thousands, and they do not measure in the tens of thousands; they measure in the hundreds of thousands—who are very frustrated indeed about local telephone number portability; frustrated about national roaming; frustrated about cellular telephone number portability; frustrated about retail services offered by means of Telecom’s fixed telecommunications network, as part of a bundle of retail services; and frustrated about the myriad issues that have not been addressed by his Government since, I believe, Paul Swain was the Minister. Paul Swain spoke about the Telecommunications Amendment Bill, back in 2001. The Minister, Mr Parker, might want to take time to do the maths now: that is 5 years ago. Paul Swain said, at that time, that “for the first time we have established a framework for ensuring that the telecommunications industry can move forward in an orderly way”. He never said it can move forward in a snail’s orderly way. He never said it can move forward in the orderly way such as a turtle would move. He never said it would move forward in the orderly way of a rock. He said it would move forward, and we suspected it would move forward with some haste.

But it is now half a decade on. In those 5 years the voice of the member for Kapiti has broken. He has started shaving. Any time now we will hear a maiden speech from him. He will actually speak in this House. He will not just stand up to move that the bill go to the next stage; he will actually make a speech in the House. In those 5 years the National Party would have liked to see more progress than simply the Minister coming cap in hand to the House to ask for a 2-year extension. I do not think that Paul Swain had that in mind.

On the key issue of increasing New Zealand’s broadband uptake, the Telecommunications Commissioner, Douglas Webb, began his investigation into unbundling in 2002. In September 2003 Webb released his draft recommendations. His final report in December 2003 recommended only unbundled bitstream access. The Government accepted this report in 2004, and hurriedly announced its decision in 2006. This, of course, brought into question the role of the Telecommunications Commissioner, and the Government’s commitment to the process and the original time line. But it never brought into question the Government’s commitment to provide telecommunications access for not hundreds, not thousands, not tens of thousands of New Zealanders, but hundreds of thousands of New Zealanders. It never brought into question its commitment, except today we see a 2-year extension. The Minister is requesting another 2 years for those hundreds and thousands of Kiwis who want decent telecommunications in a First World country.

In speaking to Part 1 of the Communications Legislation Bill I can go forward on my colleague’s comments. The progress that has been made under this present Government is totally underwhelming. Quite frankly, when we look at just how many submissions addressed the issues around Part 1, we can see that only one did. That is rather serious because it alludes to the fact that there is a total lack of direction coming from this present Government and, unfortunately, even worse, a tolerance of inefficiency around the communications sector. The company that put forward that submission made the point that the experience of the Commerce Commission’s previous investigations and determinations suggests that the commission’s proposed timetable may slip, and that any such slippage may be significant. So that is the existing mindset under the communications realm of this Government at the moment. That has become the standing order of the day, as it were. The Government tell us, within this bill, that it will provide us with certainty. I would venture to say that it does nothing but provide us with uncertainty.

Like my colleague Tim Groser, I had to do an hour and a half’s research on this bill, and on Part 1 especially, but it was not until I read Maurice Williamson’s first reading speech that I had some understanding and grasp of the bill. I then read the speeches of Pansy Wong and Georgina te Heuheu, and I was adequately empowered and enthused to be able to come down to the Chamber to speak and to hold this Government to account. The Minister in the chair, David Parker, is grinning, but he has very few answers to the questions that have been raised from this side of the Chamber.

I will concede that we are working with a hugely challenging medium. That is the point Maurice Williamson made—this is not a situation where we can take our eye off the ball and expect to remain in control. When we do our sums in Part 1, we see that only three of the particular areas that the Commerce Commission has been looking at have been concluded. The other 10 are in need of extra time, so the Government has given the commission 2 years more. As my learned colleague Georgina te Heuheu pointed out, this is obviously a de facto “throw up the white flag and surrender” situation. The Government is passing the ball, and by 2008 it will be the National Party’s problem. [Interruption] We will. We have the heart, the mind, and the fresh eyes to do so. The Government can choose the time and the place.

So it is with great sadness that I stand here, concerned for those people who have invested enormous amounts of money and who are making but one simple request—that we get certainty and some clarity around where we are going to head. This situation is very similar to many that are going on within this Government at the moment. The Government is definitely scaring the horses. Part 1 does not do a lot to instil confidence for those investors. If we want to transform this economy—which we know can potentially occur under the Communications Legislation Bill, and under Part 1 especially—then 2 years will not do it. This is just a stopgap measure. The procrastination will continue; the confusion will increase. I must say that this Government that we have at this moment is not serving the best interests of the nation. It is not taking this country in the direction we need to go in to change this economy into a First World economy. To grab the words of Georgina te Heuheu again, I say that this is nothing but a Third World economy.

Thank you, Mr Chairman. It is very kind of you. My National colleagues continue to be disappointed that, despite our hard work, we have not heard any noise from the Labour benches. Those members have not even bothered to speak. I think they are embarrassed. They are ashamed that they have had to come, cap in hand, to ask for an extension. They have been duped; they have been misled by their own Minister. In 2001 the Hon Paul Swain convinced his Labour colleagues that he would sort it out, that in 5 years’ time all those 13 designated services would have been sorted out by the Commerce Commission.

But I would like to introduce another perspective into Part 1. It seems to me that lots of the public have shown some concern about the inconsistency. I would use the words “double standard”. When the Labour Government could not execute a task to meet that deadline, what did it do? It has come back into the Chamber simply to ask for an extension. I think that for anybody—a business or an individual out there—who was dealing with the Commerce Commission, if the commission set down a time line for them to make a submission, it would be 2 weeks, or 3 weeks. I doubt very much whether they would get the same tolerance if they were to continue asking for the extensive goodwill of pushing that time line out. It seems to me that it is one law for the Government but then, when it comes to the public and business, they never enjoy the same type of latitude.

I want to compliment my hard-working colleague Colin King. In the few short hours he had he absolutely showed up the Labour members, because they have not bothered to take even a simple call. Colin King has gone around and identified that there was only one submission, made by TelstraClear. That was the only company that made a submission on Part 1, which pointed out the obvious and asked: “Why, in the first instance, was 5 years set down as the original time line?”. It said that that competition actually takes a while to happen. So, firstly, TelstraClear questioned whether the original time line, in itself, was realistic.

It further pointed out that its observation of the previous commission investigation and determination was that the timetable always slipped. Not only did the timetable slip, but it slipped in a very significant way. National, reluctantly, will support the bill because we do not want to cause any more uncertainty for the people out there, but we want to put on record that we totally agree with TelstraClear’s observation that the way the Government has not been able to meet its timetable is incredible. That timetable was not missed by just an inch. Actually, just now, my diligent, hard-working, and articulate colleague Phil Heatley said that the Government moved at a snail’s pace. [Interruption] Tortoise? I say that is an insult to a tortoise!

This Labour Government has certainly demonstrated to the public that it knows how to miss timelines, but it has never made allowances for businesses to adhere to the same standard. It never gives businesses the same latitude it gives itself when it comes to rushing through legislation and saying the commencement date is in 2 months’ time. It seems to think businesses exist to serve the Labour Government’s whim whenever it wants to pass legislation. So if there are compliance costs, Labour members say: “Oh well, what compliance costs? It is a privilege for a business to operate.” If the Government wants to commence a time line, it simply names a day and asks why the business cannot comply.

I pick up the point made by my colleague Colin King, who referred to some comments that Maurice Williamson made in this House—I think in the first reading debate—about this area being a fast-moving one. It is a hugely fast-moving area. Not very long ago—10 years ago—did we all, as New Zealanders, have mobile phones? Probably not. Suddenly there has been an explosion of uptake of the mobile phone by New Zealanders, from the elderly right through to the young. When there is an explosion in that direction, then, obviously, normal people look very, very quickly for advancements and enhancements. It does not take long to come to terms with the technology, particularly if there are younger people around who are using it. Those of us like myself sometimes have a little difficulty in getting on to the new technology, but there are always young people—or a young person—nearby who can help us to get there very quickly. I do not think this Government has any idea, really. I am willing to say that I get very challenged.

Part 1 of the Communications Legislation Bill refers to a “local telephone number portability service”, to cellular telephone “roaming”, and to “co-location”. We as New Zealanders demand those things now. It is not the case that we will just wait around and think that no doubt the Government in good time will make sure those things are made available to us—no, we demand them now. We demand them in our everyday lives, both at a personal level and, particularly, in terms of professions and businesses. We have to have those things in place, and I wish this Government would get a sense of urgency into this area. There have been reviews, and all sorts of papers have been prepared over the past 5 years, but have we seen any urgency? No, not at all. The only reason this bill is in the Chamber now is that the period of regulation expires in December, so somebody had to get off his or her chuff and bring a bill into the House in order to get the time line extended. Is there any guarantee, based on this Government’s performance in the last 5 years, that Government members have any sense at all of urgency in the communications area? New technology will soon be upon us and we still have not come to terms with the services listed here in clause 4.

I do not know whether the Minister in the chair, David Parker, has sat there before in the Committee stage of any bill. He is a relatively new Minister, because he had a gap when he was put out of the ministership, but then, for some reason—I am not sure why—was put back in again. National urges the Minister to get on his feet and say something that gives some confidence to us all that he is aware of the complexity of and the urgency associated with this sector, that he is aware of the need for stability, and that he is aware of the need for the likes of Econet—I know a little about Tex Edwards, even though I was not on the Commerce Committee. I understand that that submitter is a rather colourful character. I know a little about that particular company’s activities, simply because Mr Edwards is in partnership with iwi in terms of the spectrum they received.

💬 Darren Hughes: That’s a very bad example.

The member from Otaki—

💬 Darren Hughes: It’s “Ōtaki”. Say it right!

I know how to say it; I will say it how I like. In terms of the comments that that member is making, he can joke about all of this, but it ain’t a joke.

It is not a joke that 5 years on, this Government still has not achieved what Paul Swain laid out in 2001. Paul Swain was a very good Minister, I add. What a shame it is that he is not still there. He might have got this thing moving—it does not look as though it is going to move now. The Minister cannot even get to his feet; there is no movement there. What a pity; what a shame! No matter how many times tonight we ask him to stand and give us some reassurance, he looks as though he is just going to sit there like a great lump and say nothing at all.

National has supported this bill right through. It disturbs me to know that tonight, when National is prepared to support this bill right through the Committee stage, we will be voting on Part 1 only. What about Part 2? What about the title and commencement? The reason is that the Government does not have the support of the other parties to be able to get this bill right through the Committee stage.

The CHAIRPERSON (H V Ross Robertson): Part 1.

I am coming back to Part 1. We are debating only Part 1 tonight because the Government does not have support from the other parties to have a Part 2 vote. We cannot discuss Part 2, or the title and commencement.

Let us look at why we are talking about Part 1 only. It is because a Supplementary Order Paper in the name of New Zealand First has come up in relation to clause 6 in Part 2. Here is a Government that wants us to have confidence in the integrity of the process, and to give that certainty we have talked about to all those consumers who are very dependent on communications and telecommunications, yet it is not prepared tonight to allow us to finish the Committee stage, which National is supporting.

We will be able to vote on Part 1 only. The question I ask is why. It is because, in my view, the Government does not have the support of the other parties. When I look at this Supplementary Order Paper that New Zealand First has tabled, I suggest that there is probably some question mark over this bill, and that is why we will not be proceeding with Part 2 and the title and commencement. Of course, the Minister has a Supplementary Order Paper, as well. Maybe we will see, when we look at the Minister’s Supplementary Order Paper, that those parties whose support the Government needs to get its legislation through have some doubts about it.

So although National is supporting this legislation, and has done so through all the stages, it is very disconcerting to find that we will be able to talk tonight about Part 1 only. In Part 1, the principal Act is defined as the Telecommunications Act. Part 1 makes amendments to the Telecommunications Act, and I needed to go back to the statute book to find out what changes are being contemplated here. There are only two clauses in Part 1—clauses 3 and 4. Clause 4 relates specifically to section 65 of the principal Act. I got out the principal Act to see what that clause actually means. Section 65(1A), inserted by clause 4, states that the 5-year period will be taken out to 7 years: “In subsection (1)(a), 5 years must be read as 7 years …”. There is an extension of 2 years, so that is a change. There are a number of other changes made to subsection (1)(a), in the form of paragraphs (a) to (j).

But, at the end of the day, the confidence that subscribers around the country are expecting will be found short. We looked earlier at a piece of legislation called the Securities Legislation Bill, which National supported, and talked about confidence in the integrity of the system. That is what subscribers look for. That is what developers want when they are doing their subdivisions. Yet we see that this legislation is falling well short of the mark. This is an indictment on the Government. There is huge demand out there for telecommunications services, and in the area I represent some areas and some subdivisions are just not being catered for.

I move, That the question be now put.

I move, That the Committee report progress.