Questions for Oral Answer

1. to the Prime Minister: Does he stand by his statement that by early 2010 New Zealand will be coming out of the recession “reasonably aggressively”?

Yes, I stand by my full quote from March 2009, which is: “… I think by the end of 2009 early 2010 this time next year we’ll be starting to come out of that and I think starting to come out of it reasonably aggressively. I’m more optimistic about 2011 than 2010 but nevertheless I think 2010 will be positive.” Those statements have proved to be absolutely, entirely, 100 percent correct.

💬 Hon Phil Goff: Two years into his Government does he take responsibility for the economic results that came out today, which were much worse than Treasury estimated 6 months ago, or will he continue to blame everybody else for his failure?

💬 Rt Hon JOHN KEY: Well, I cannot take responsibility for a global financial crisis, although Michael Cullen once blamed me for it. I cannot take responsibility for an earthquake. I can take responsibility for doing something about leaky homes—the previous Government did absolutely nothing for homeowners—and I can take responsibility for New Zealand having the best tax switch it has had in 25 years.

💬 Hon Phil Goff: Will he then take responsibility for the fact that a large part of that deficit was because this economy has not performed under his management over the last 6 months, as Treasury says?

💬 Rt Hon JOHN KEY: I am glad we are coming into the Christmas period, because maybe Phil Goff can take a holiday, even if it will not be supported by—

💬 Hon Phil Goff: I raise a point of order, Mr Speaker. You know that Ministers cannot start with that sort of gratuitous attack on a member who asks a question. Nor did that address the question. [Interruption]

💬 Mr SPEAKER: A point of order was called. I accept the basis of the member’s point of order. The only issue, though, is that he may recollect that his previous supplementary question was fairly blatantly political. I seem to recollect his saying something about the Prime Minister’s failure. Then the supplementary question that the member asked just now was more of a statement than a supplementary question. Where members make political statements, there is a limit to how much I can control Ministers in terms of their answering them with political statements. However, I would ask the Prime Minister to come to the substance of the statement as quickly as possible, please.

💬 Hon Trevor Mallard: I raise a point of order, Mr Speaker. How does he take responsibility for Treasury’s statement?

💬 Mr SPEAKER: The member stopped just when the statement started, and I seem to remember that what followed was a fairly loaded statement. [Interruption] There are plenty of Speakers’ rulings that indicate that there are devices that are used to try to turn a statement into a question. Some former Speakers did not allow them, but I do. But I would ask the Prime Minister to please come to the substance of the statement in his answer.

💬 Rt Hon JOHN KEY: New Zealand’s economic position relative to Ireland, Greece, Spain, Portugal, the UK, the United States of America, most of the European Union, and all of the OECD is stronger than it was. So, no, I cannot take responsibility for the global financial crisis, but thank goodness we have a leadership team that is taking New Zealand out of these difficult conditions.

💬 Hon Phil Goff: When looking at the blowout in the Government’s deficit of $2.5 billion over the last 6 months, how much of that deficit can be accounted for by tax cuts for the wealthy, which it is now shown that he is effectively borrowing in order to pay for?

💬 Rt Hon JOHN KEY: None.

💬 Hon Phil Goff: Can the Prime Minister tell the House how successful gimmicks like a cycleway and the Job Summit have been in reducing the unemployment and welfare rolls and as a way of contributing to creating new jobs and cutting expenditure?

💬 Rt Hon JOHN KEY: Very. Although I am prepared to accept that things are not going brilliantly for the New Zealand economy, all I can say is they are going better than they are for the Labour Party.

💬 Hon Phil Goff: Why did he yesterday describe the tax take as being slightly down, when the reduction in corporate tax has been a massive 28 percent over the last 4 months from what was forecast; is that not a sign that this economy is failing?

💬 Rt Hon JOHN KEY: No, not if one looks at the way that corporate taxes are paid. They are paid on a provisional basis. Everyone understands that when the bad times initially come, corporate tax is higher, and that over a period of time it takes a while to catch up. The member will remember that under the Labour Government, corporate taxes were much higher than had been anticipated.

💬 Rahui Katene: Is he aware that the Children’s Social Health Monitor released yesterday showed a dramatic rise in hospital admissions for Māori and Pasifika children for conditions with a social gradient over the last 2 years, and what actions will the Government take in a post-recession Budget to protect the most vulnerable children from such hardship?

💬 Rt Hon JOHN KEY: I have not seen the document that the member is quoting from. What I can say is that the Government is trying to tackle those issues with a variety of different mechanisms, and in a variety of areas. Whānau Ora would be one good example of that, where we are trying to get in and support families at the grass roots in order to make a difference for those vulnerable children.

💬 Rahui Katene: What consideration will he give to recommendations from the Māori Party, the Child Poverty Action Group, and the Alternative Welfare Working Group for the in-work tax credit to be extended to all low-income families as an immediate support for families on benefits?

💬 Rt Hon JOHN KEY: I think that is very unlikely. The reason is that the fiscal cost of that would be significant. When the policy was introduced by the previous Labour Government, it was brought in because there was a recognition that we always wanted to make sure that working paid. The in-work tax credit recognises that, and National’s position at the time supported that.

Economic Outlook and Government Financial Position—Reports

2. to the Minister of Finance: What reports has he received on the economic outlook and the Government’s financial position?

Today the Government released the Half Year Economic and Fiscal Update and its first Investment Statement. These documents show that economic growth will be steady, and show an improvement in the Government’s fiscal position, though the fiscal position this year is worse than was expected at the 2010 Budget. The figures confirm that the events of the past 6 months, particularly the Canterbury earthquake, and more subdued domestic recovery have taken this year’s deficit to the outer limits of what is acceptable to the Government. However, we remain on track to achieve surpluses by 2015-16, as expected in the Budget.

💬 Craig Foss: What is New Zealand’s main challenge, as identified in the Half Year Economic and Fiscal Update?

💬 Hon BILL ENGLISH: Unquestionably our most significant challenge is to reduce the vulnerability to overseas financial markets that was caused by the extent of our overseas lending. Our main challenge is to increase national savings. The Government can play a role by producing more saving and less borrowing, and we can also encourage New Zealanders to lock in their change in habits over the past couple of years, a change that has indicated quite a dramatic shift to spending less and saving more. Early in the new year the Government will be hearing from the Savings Working Group, which was set up 6 months ago, and we will be considering decisions then.

💬 Craig Foss: How will Budget 2011 take further steps to address the issues highlighted in today’s economic update?

💬 Hon BILL ENGLISH: Budget 2011 will lock in a reasonably sharp improvement from the significant deficit this year. In fact, the forecast today shows that we expect the Government deficit to halve in Budget 2011, reducing to around 2.8 percent of GDP. We will also be pressing on with our six-point economic programme, including extensive investment in infrastructure, increasing the efficiency of the public sector, and supporting business with innovation and trade. We will also be considering work from the Welfare Working Group and the Housing Shareholders Advisory Group, and we will be publishing the second National Infrastructure Plan.

💬 Craig Foss: What does the Government’s first Investment Statement show?

💬 Hon BILL ENGLISH: The Government’s first Investment Statement shows the extent of assets owned by New Zealand taxpayers, which New Zealand taxpayers have funded through paying their PAYE tax, their power bills, their petrol tax, and their road-user charges. The Crown owns $223 billion worth of assets. It is by far the largest owner of assets in the country—about five times the size of the New Zealand Exchange. By 2015 it expects those assets will grow by $33 billion, which includes investment in schools, hospitals, broadband, electricity generation, and roads; extensive rail investment; and accumulating financial assets. We owe it to taxpayers to manage this very large resource much better than it has been managed in the past.

💬 Craig Foss: How do today’s economic projections compare with those of other forecasters?

💬 Hon BILL ENGLISH: This morning the New Zealand Institute of Economic Research released the consensus forecasts, which are, on the whole, very similar to those of Treasury. They show growth of about 2.1 percent this year, rising to 3.5 percent next year. Probably more important, they show unemployment falling steadily to 5 percent over the next couple of years, and wage growth accelerating to about 3 percent in 2012-13, comfortably ahead of inflation.

Pansy Wong—Compliance with Cabinet Manual

3. to the Prime Minister: Does he stand by his advice to the House last Tuesday that he accepts former Minister Pansy Wong “made an unplanned and inadvertent mistake”?

Yes, because that was the finding of the independent McPhail report.

💬 Hon Pete Hodgson: Would he be surprised to learn that having approved his Minister’s private travel to China in December 2008, Mrs Wong was greeted in Lianyungang by a large, pre-printed banner, which, when translated, read: “Warm welcome to New Zealand Cabinet Minister to visit and inspect our company”, and does he therefore still believe that the trip was private, and the mistake unplanned and inadvertent?

💬 Rt Hon JOHN KEY: To the latter part of the question, yes. To the former part of the question, no, because when one goes to China and one is an important person, often there are banners. I accept that that member would never have had one other than “Goodbye and see you later”, but members on our side of the House get lots.

💬 Hon Pete Hodgson: Would he be surprised to learn that Mrs Wong then inspected that company and encouraged “the staff members of Hovercraft to be innovative and brave”, and that she wished “the company achieve a great success in the nearest future”; and, noting that her husband is a part-owner of that company, does it now occur to the Prime Minister that the trip to Lianyungang was motivated by matters other than attending the flower show, as Mrs Wong claimed?

💬 Mr SPEAKER: The Rt Hon Prime Minister may answer, in so far as he has responsibility.

💬 Rt Hon JOHN KEY: No. It was acknowledged that Pansy Wong visited that company. Good wishes to people who work in companies are not unusual things to express.

💬 Hon Pete Hodgson: Would he be further surprised to learn that while in Lianyungang city Mrs Wong met with the chief secretary of the city and “attended the signing ceremony of co-operation framework agreement between New Zealand Pure Natural Ltd and the people’s government of Niushan town, Donghai, and Lianyungang city”, all of this on a private trip he approved; and did he know that the majority shareholder of New Zealand Pure Natural Ltd is Sammy Wong, who was also there on a taxpayer-funded trip?

💬 Mr SPEAKER: The right honourable Prime Minister, in so far as he has responsibility.

💬 Rt Hon JOHN KEY: No, I have no knowledge of that. But what I can say to the member, as I have said the whole way through, is that if the member wants to take anything to the Auditor-General or the police, he is more than welcome to do so, and the resignation of Pansy Wong from Parliament does not alter that one little bit.

💬 Hon Pete Hodgson: Acknowledging that Mrs Wong’s resignation does not alter that fact one bit in respect of the possibility that public moneys may have been misused, will he now agree to refer these issues to the Auditor-General, showing leadership that he managed to discover with earlier Ministers but somehow not with this Minister?

💬 Mr SPEAKER: The Prime Minister has no responsibility for members travelling on a private trip. I do not see why the Prime Minister is responsible for that issue.

💬 Hon Trevor Mallard: I raise a point of order, Mr Speaker. The Prime Minister has the ability as Prime Minister to refer anything he wishes to the Auditor-General, and he is being asked whether he intends to do what he did previously—for example, not all of Mr Heatley’s travel was ministerial travel and—

💬 Mr SPEAKER: I have heard the member sufficiently. The Prime Minister may answer the question in so far as it is simply seeking his view of something, but it does not automatically mean the Prime Minister has the responsibility. I call the right honourable Prime Minister to answer the question in so far as he can.

💬 Rt Hon JOHN KEY: No. For me to do that would be to rely on the information that Pete Hodgson has, or thinks he has, and, actually, in my experience of Pete Hodgson, he is more often wrong than he is right.

💬 Hon Phil Goff: As the Prime Minister has acknowledged he knew nothing about a second visit to a company largely owned by Mr Wong, does he still stand by his statement of 9 December that “there is no basis for further investigation”?

💬 Rt Hon JOHN KEY: Yes, and if any member wants to take any allegations to the police or the Auditor-General, then they should feel free to do so.

💬 Hon Phil Goff: Does he stand by his statement on 9 December that Mrs Wong’s misuse of a taxpayer-funded trip was simply “an innocent mistake” and that she was certainly fit to remain as a member of Parliament; if so, how does he explain the Wongs’ failure to come clean with Mr McPhail about the full extent of their business dealings while in China on a taxpayer-funded trip?

💬 Rt Hon JOHN KEY: Yes, I stand by my statement. The Leader of the Opposition is making unfounded allegations.

💬 Hon Phil Goff: Why was the Prime Minister in this morning’s media so keen to see referred to the Auditor-General unproven allegations against Len Brown, Mayor of Auckland, when he is not prepared to send proven allegations against the Wongs to the Auditor-General?

💬 Rt Hon JOHN KEY: They are not proven, and I am not the one sending them in the case of Len Brown.

💬 Hon Pete Hodgson: I have a number of documents, which I seek leave to table. The first is called a supreme newspaper. It is a newsletter of Lianyungang Supreme Hovercraft Ltd dated January 2009. It is off a website that has subsequently been taken down, and, as well as the original Mandarin and photographs, it has an English translation.

💬 Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is objection.

💬 Hon Trevor Mallard: I raise a point of order, Mr Speaker. When people object, they must say so. The Prime Minister cannot object by nodding.

💬 Mr SPEAKER: I thought I heard the Prime Minister say yes. [Interruption] Well, I am sorry but the Speaker determines that matter.

💬 Hon Pete Hodgson: I seek leave to table an extract from the New Zealand Companies Office database regarding New Zealand Pure and Natural Ltd, showing major shareholding by Sammy Wong and other shareholders, including Jenny Shipley.

💬 Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is objection.

💬 Hon Pete Hodgson: I seek leave to table a document from the Lianyungang City Overseas Exchange Association website congratulating Pansy Wong on becoming a new Cabinet Minister in New Zealand, dated 2 December 2008, and acknowledging that she will travel to Lianyungang towards the end of the year, which she did 3 weeks later on an unplanned trip.

💬 Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is objection.

Prisons, Mt Eden and Auckland Central Remand—Private Management Contract Appointment

4. to the Minister of Corrections: What steps have been taken to ensure that the corrections system has better access to world-class innovation and expertise?

This Government is committed to a world-class corrections system in New Zealand. To achieve that, we must have access to world-class innovation and expertise. Today I was delighted to announce that global services management company Serco has been selected to manage the Mt Eden Prison and Auckland Central Remand Prison. Serco has a strong track record in managing prisons, operating six adult prisons and two youth offender centres in the United Kingdom and Australia. I am confident that this new partnership will lead the way in delivering innovation and excellence across the entire corrections system.

💬 Sandra Goudie: What benefits does the Government expect to obtain from the private management of prisons?

💬 Hon JUDITH COLLINS: One of the major advantages of private management is the ability to build performance incentives and penalties into the contract. It also allows the Government to target problem areas more effectively. The contract now being finalised with Serco will contain rigorous oversight and significant financial incentives to ensure that the company consistently delivers its services to a high standard. We also expect the partnership will lead to innovation and efficiencies that can be extended to prisons throughout the New Zealand corrections system.

Question No. 5 to Minister

I raise a point of order, Mr Speaker. Question No. 5 was originally set down for the Prime Minister, to ask him about his specific commitment to achieving an economic step change for New Zealand. I am not sure that it is fair or relevant to ask that of the Minister of Finance. I do not know that he made such a commitment.

💬 Mr SPEAKER: It is the Government’s responsibility who answers questions in respect of responsibility. The question is about New Zealand’s economic performance, and it seems not unreasonable that it be directed to the Minister of Finance.

When the Prime Minister promised a step change in economic performance, did the Minister of Finance believe that the step change—

💬 Mr SPEAKER: That is not what the question in front of me actually says.

The original question was to the Prime Minister, asking him about his promise—

💬 Mr SPEAKER: With respect, the member has been in this place just as long as I have and knows that the final wording of questions is agreed with the Clerk’s Office. Some questions require rewording. I ask the member to ask the question as worded.

Economic Performance—Step Change

5. to the Minister of Finance: Was it his objective for the National-led Government to deliver a step change in New Zealand’s economic performance, and if so, has such a step change been achieved?

Yes, it is our objective, although incoming National Governments always find they have to achieve this. In 1975 and 1990 the incoming National Governments inherited from the previous Labour Governments economies that were headed for recession with bad Budget positions. In hindsight, I wonder why we did not expect that in 2008, but—

💬 Mr SPEAKER: As I read this question, it simply asks: “Was it his objective for the National-led Government to deliver a step change in New Zealand’s economic performance, and if so, has such a step change been achieved?”. There is nothing wrong with referring to past record, but the substance of the answer should not be an attack on other parties. This is a question on notice, and the answer should relate to whether the Minister considers—and there is no fixed answer to it—that a step change has been achieved. The other matter may be relevant, but it should not be the prime part of an answer to dump on the questioner’s party.

💬 Hon BILL ENGLISH: Yes, it is our objective. In response to the member’s question of whether a step change has been achieved, I say that incoming National Governments achieved a step change in growth both in 1975 and in 1990, and we probably should have expected that it would be required in 2008.

💬 Mr SPEAKER: The Minister has totally ignored the Speaker. We are getting close to Christmas and I do not want to deal in too severe a way with any member, but I ask the member to treat the questioner with some respect. As I understand it, the Minister has acknowledged that a step change in New Zealand’s economic performance was an objective. It ought not to be too difficult for the Minister to say whether the Government has achieved that, without going back and giving the House a history lesson, as he was doing. Given the question asked, that is not reasonable or fair. I ask the Minister to listen to what the Speaker is saying on this matter because members have a right to ask reasonable questions. This is not an unreasonable question.

💬 Hon BILL ENGLISH: Yes, and this Government inherited an economy that was contracting and shrinking; in fact, the export sector started shrinking in 2005. Since then we have turned it round considerably, but there is a long way to go.

💬 Hon Jim Anderton: Does the Minister of Finance believe that the step change has been brought about by giving $14 billion in tax cuts to New Zealanders earning over $100,000, meaning that the previous Government’s fiscal surpluses would change to the massive deficits revealed today?

💬 Hon BILL ENGLISH: The member is showing that he does not understand the legacy left by the previous Government, which was, in the 2008 Budget, a forecast of 10 years of deficits. The tax packages that this Government has produced since 2009 have been fiscally neutral—that is, income tax cuts have been paid for by increases in taxes or reductions in expenditure elsewhere. The member is simply wrong.

💬 Hon Jim Anderton: Has the Minister of Finance seen figures released today showing that retail sales slumped by 2.5 percent after the GST increase to 15 percent in October, which went with rising prices, falling real wages, and higher unemployment; if so, how are those outcomes a sign of the economic step change that the Prime Minister promised?

💬 Hon BILL ENGLISH: I agree that the flat consumption is in sharp contrast to the record of the previous Government, when from about 2004 onwards the export sector was driven into the ground and New Zealanders went on a debt-funded spending binge. We make no apology for the fact that our policies are designed to turn that round by encouraging savings and exports. An increase in GST and an increase in the effective tax rate on housing will help us to avoid the same kind of binge occurring again.

💬 Hon Jim Anderton: Did the Minister note that GDP in constant dollars rose by 1.2 percent from December 2008 to June 2010, compared with the 3.4 percent rise in the corresponding first 18 months in office of the previous Government; if so, is that again an example of the step change that the Prime Minister promised?

💬 Hon BILL ENGLISH: Given the global financial crisis that intervened and the damage done, including the damage done by that member, to our export sector, I accept that the first few years of growth under this Government have not been as high as we would like them to be. However, we are putting in place the platform to turn round the damage done by the previous Government, to overcome the effects of the global financial crisis, and to strengthen our economy.

💬 Hon Phil Goff: Given that he is refusing to take responsibility for the economic position he has had 2 years to influence and that he is blaming the previous Government, why did he describe on 18 December 2008 the economic position of this country he inherited from Labour as “reasonable” and why did his Treasury officials state in their briefing to him that Labour had “done a good job of getting the New Zealand economy in a position where it can respond well to economic shocks.”? Why does he not take responsibility for his own actions?

💬 Hon BILL ENGLISH: In December 2008 that advice was wrong. The net debt position of the Government’s books was relatively sound, but Government spending was completely out of control. The export sector had been driven into the ground, there was a loss of confidence in investment, and debt was going through the roof. It has taken us all of the last 2 years to turn round the damage done by Labour to New Zealand’s economy.

Public Transport Investment—Effect on Congestion and Commuter Stress

6. to the Minister of Transport: What is his response to the finding of the IBM Commuter Pain survey that investment in public transportation is key to reducing congestion and commuter stress?

I note that improving public transportation, better management of the roading system, and providing greater flexibility to work from home are all cited by commuters in the survey as measures by which transport stress can be reduced. The good news is that the Government is very active on all of those fronts: firstly, investing nearly $2 billion in commuter rail in Auckland and Wellington; secondly, better managing the roading system by completing the Auckland and Wellington roading networks with projects like the Waterview Connection and Victoria Park to extract the full benefits from those networks; and, thirdly, wearing another hat, investing $1.5 billion in ultra-fast broadband to provide better telecommunications and encourage telecommuting from home, amongst other things, to reduce the need to travel around our cities.

💬 Gareth Hughes: How can he reduce congestion for stressed Kiwi motorists when he has cut funding for every activity other than new State highways, including cuts of 26 percent for walking and cycling and cuts of 50 percent for public transport infrastructure?

💬 Hon STEVEN JOYCE: The member is simply completely incorrect in those assertions.

💬 Gareth Hughes: How can the Minister claim to be providing for a balanced transport system when over 80 percent of new project funding since he became the Minister has been for new motorways?

💬 Hon STEVEN JOYCE: I point out to the member that the roading system carries by far the vast bulk of commuters and freight movements through New Zealand—

💬 David Shearer: What about the “Holiday Highway”?

💬 Hon STEVEN JOYCE: In fact, the highway referred to by the member opposite carries more traffic and more people per day than the entire Auckland commuter rail network currently. It is good that we are investing in commuter rail, because it has the potential to grow over time, but the member is deluding himself if he thinks that is the solution, given where we started from.

💬 Gareth Hughes: Can he confirm that the majority of conventional economic benefits from the central business district rail loop in Auckland would be congestion reduction for road users?

💬 Hon STEVEN JOYCE: Yes, I could. Unfortunately, the numbers are not as high as that, and it is not until we get out to the “transformational benefits”—which Treasury, for example, has rather severe doubts over—that we actually get to much larger benefit-cost ratios. But we will assess that project over time. It is important that we assess it carefully and with clear eyes because, as the member may have noted from earlier in this session, the Government has to be very careful fiscally.

💬 Gareth Hughes: Given that the central business district rail loop will significantly benefit motorists, stimulate three times as many wider economic benefits as the Pūhoi to Wellsford “Holiday Highway”, and is supported by Auckland, will he now prioritise the central business district rail loop?

💬 Hon STEVEN JOYCE: The member is well ahead of himself in that respect. I point out to him that he is talking about notional future demand versus current demand in comparing two projects. Also, he is comparing a commuter project with an interregional roading project. The two are rather different. There are many questions to be answered in the central business district rail case before we even consider who might fund it—for example, exactly how many cars it might take off the road 5 years after it opens, which is not apparent from the business case and would seem to be reasonably important for something that is promoted as a congestion buster.

💬 Gareth Hughes: Given the Minister has said that more analysis is needed, why did he commit billions of dollars to the Pūhoi to Wellsford “Holiday Highway” in March 2009 when the business case was not completed until 9 months later, in December 2009, and, as the Minister said only 4 weeks ago, “No work had been done on this project prior to it being confirmed as a road of national significance”?

💬 Hon STEVEN JOYCE: I point out to the member that the nomination of a road of national significance is not the final shape of the project; it continues, of course, to be refined. Again, I refer to the difference between a notional project, which talks about projected possible demand in the future, and a project that is creating the demand and is under spec right now. It is quite obvious that the road that he keeps trying to compare with this commuter rail project has demand on it right now and needs to be addressed for a range of reasons, including safety, economic growth, and connection between Northland and the city of Auckland.

💬 Gareth Hughes: When will the Minister admit that all the evidence demonstrates that public transport, like the central business district rail loop in Auckland, is a better way to cut congestion and reduce commuter stress than wasting billions on his uneconomic pet motorways?

💬 Hon STEVEN JOYCE: I have to say I think that the member’s suggestion is reasonably adolescent. Debating which projects should proceed does not mean unquestioning support for any project on the grounds that one transport mode is good and another one is bad. We have to be slightly more mature than that.

Child Poverty—Government Action

7. to the Prime Minister: In light of his statement of 9 February 2010 that “I worry that there are signs of an emerging underclass in New Zealand”, what action has his Government taken to reduce the number of children living in poverty since that statement?

The Government believes that paid employment is the best way out of poverty for children and families. This year we have been working hard to create jobs and grow family incomes by strengthening the New Zealand economy, and repairing the damage done by a global recession and 9 sad years of a Labour Government. We have continued to run substantial deficits to fund social services that support children and families, including those in vital areas such as education and health, and to fund income support payments, like Working for Families.

💬 Hon Annette King: What is his definition of an underclass in New Zealand?

💬 Rt Hon JOHN KEY: It is a New Zealand where the rungs on the ladder of opportunity are broken.

💬 Hon Annette King: Has he read the comments from Unicef that “The overall picture painted by the updated 2010 Children’s Social Health Monitor is deeply concerning.”, and “That so many of our children are admitted to hospital for illnesses associated with socio-economic deprivation is a wake-up call for all New Zealanders.”; if so, does he agree with those comments?

💬 Rt Hon JOHN KEY: No, and no.

💬 Hon Annette King: Is he prepared to set targets for the eradication of child poverty in New Zealand, as urged by the Every Child Counts organisation; if not, why not?

💬 Rt Hon JOHN KEY: No, but I am prepared to commit Government resources to try to lift children out of poverty. There are a number of things we can do. Firstly, we can make sure that every child has a decent education, and, of course, national standards are an important step in that regard. We can make sure that we reform welfare, so that so many young New Zealanders are not trapped in welfare dependency, as was obviously the case under the Labour Government. We can make sure that we have innovative ways of tackling these areas, and Whānau Ora is a great example of that. I could go on, but we have the adjournment debate sometime tomorrow, and members will want to go home tomorrow evening.

💬 Hon Annette King: Did he read the recent article in the Challenge Weekly newspaper by Garth George, a strong advocate of the Prime Minister and the National Party, who said “The measure of a society’s soul is the way it treats its most vulnerable members—children, … —and on this measure we fail miserably.” and “The gap between rich and poor is still widening rather than closing, depriving many of the right to live even a subsistence life and forcing many to work so hard that family life is non-existent.”; if so, does he agree with him?

💬 Rt Hon JOHN KEY: No, I did not see the article. Yes, I agree with parts of what he said.

💬 Hon Annette King: Does he agree with Presbyterian Support, an organisation that has been working for 100 years in the community, which asks “How can a small, relatively well-off country like New Zealand allow such a generous ration of misery for so many, when at face value there should be more than enough to go around?”

💬 Rt Hon JOHN KEY: On face value I agree with Presbyterian Support. The question we have to ask ourselves as a country is how we address that issue, which is an important issue. One of the things we need to do is to deliver opportunity for those kids, because being poor does not rob someone of hope. What is absolutely required is a decent education. I personally am saddened that for 9 years I sat back and watched the Labour Government allow more and more young New Zealanders leave school unable to read and write properly. If I were a member of that Labour Government, I too would be deeply ashamed of what it did. I know that members opposite are scared and frightened of their record in that area, and embarrassed at this Christmas time, but, unfortunately, that is their record in office.

💬 Hon Annette King: Does he still believe that Working for Families, which lifted thousands of children out of poverty in New Zealand, is communism by stealth?

💬 Rt Hon JOHN KEY: When it faced very high effective marginal tax rates of nearly up to 100 percent, yes, and that is why this Government changed it dramatically through its tax cuts. New Zealanders who faced that are very grateful for that change.

💬 Hon Annette King: Did he say to a delegation of Church leaders whom he met in late November to discuss the future of welfare in New Zealand: “If we cancelled welfare to 330,000 people currently on welfare, how many would starve to death? Bugger all.”; if so, does he stand by that stupid comment?

💬 Rt Hon JOHN KEY: I have no recollection of the comment. What I do have a recollection of—

💬 Hon Members: Ohhh!

💬 Rt Hon JOHN KEY: I say to those members that if they want to hear the answer, they should let me finish. I have a recollection of two things: one was quite an extensive conversation about how we might reform welfare; the second was one of those Church leaders making a very offensive statement, and I having to correct him about it.

Broadband, Ultra-fast—Progress

8. to the Minister for Communications and Information Technology: What progress has the Government made this week on the Ultra-fast Broadband Initiative?

This week has seen further significant progress. I have just returned from Manaia View School in Whangarei, where the first stretch of fibre has been put in the ground, marking the beginning of the nationwide roll-out that will see 75 percent of New Zealanders have access to ultra-fast broadband. Deals have been signed with two companies, covering 16 percent of the premises targeted. These areas will be completed by 2015. I am very pleased that this important infrastructure project is under way before Christmas. The benefits should be available to the likes of the children of Manaia View School early in the new year.

💬 Jonathan Young: What progress has been made in other regions covered by the urban broadband policy?

💬 Hon STEVEN JOYCE: Crown Fibre Holdings yesterday announced a further three parties that it will start to negotiate binding offers with for the roll-out of ultra-fast broadband infrastructure in the remaining regions. They are Enable Networks, covering Christchurch and Rangiora; Flute Network, a joint venture covering Dunedin; and Telecom New Zealand, covering all areas except those covered by the previously short-listed bids. This paves the way for further deals to be agreed to in the first quarter of next year and more regions to benefit from ultra-fast broadband.

💬 Clare Curran: Why is the Government trusting Telecom to deliver the best ultra-fast broadband outcome for New Zealand, given its history of competition abuses, which is strewn with examples of non-compliance and obfuscation, including eight breaches of the Fair Trading Act since 2003, with fines and repayments totalling nearly $14 million, and one breach of competition law under the Commerce Act relating to Telecom’s high-speed data transmission offering, for which the Commerce Commission is reportedly currently seeking penalties of up to $25 million in the High Court?

💬 Hon STEVEN JOYCE: First, I point out to the member that no deal has yet been done with Telecom. I also point out that she probably needs to decide which view she has in relation to that. Publicly she said on 5 July of this year: “It is not in New Zealand’s interests for Telecom to be run into the ground and excluded from the biggest network build for the next generation.”, so I am not quite sure what the member’s view is.

💬 Clare Curran: I raise a point of order, Mr Speaker. The Minister did not answer the question; instead he told me what I had said.

💬 Mr SPEAKER: The member asked why the Minister was trusting Telecom for certain things. If I remember the Minister’s answer correctly, he said no deal had been concluded yet. He then pointed out that the member had suggested herself that Telecom should not be excluded from these things. The question asked for an opinion on why the Minister was trusting Telecom, and the Minister gave an opinion. It is difficult for me to ask for a more precise answer than that.

💬 Clare Curran: I seek leave to table a media release from the Commerce Commission dated 18 June 2010, titled “1,300—

💬 Mr SPEAKER: No, we do not table media releases as recent as that. Does the member have a further document that she wishes to table?

💬 Clare Curran: I seek leave to table an article titled “Harsh penalty sends message”—

💬 Mr SPEAKER: What is the source of the document?

💬 Clare Curran: It was published on the Stuff website on 7 December 2010, and was written by Nick Krause.

💬 Mr SPEAKER: I will let the member further describe the document. This is published on a Telecom staff website, is it?—[Interruption] Oh, the Stuff website; I beg your pardon. No, we do not do that.

Marine and Coastal Area (Takutai Moana) Bill—Criticism and Durability of Framework

9. to the Attorney-General: Is he aware of the widespread criticism of the Marine and Coastal Area (Takutai Moana) Bill from both Māori and non-Māori submitters, and does he have confidence that the bill will provide a durable framework for consideration of foreshore and seabed claims?

Yes and yes.

💬 Hon David Parker: Does the Minister intend to seek any assurance from the Māori Party that it accepts that the Government’s new foreshore and seabed bill will, if passed, fully and finally settle the legal framework for consideration of foreshore and seabed claims; and, if no such assurance is forthcoming, will he be willing to consider adopting the solution favoured by Labour, the Greens, the ACT Party, and many submitters—Māori and non-Māori—who say the issue of the threshold test, as well as that of unextinguished rights, ought to be referred back to the courts for statutory protection for access and non-alienation?

💬 Hon CHRISTOPHER FINLAYSON: I am not really quite certain where the Labour Party stands on this issue, because that may be the latest permutation but the submission by Dr Cullen—a very good submission—to the ministerial review panel emphasised the need for codification of the tests and said: “to wait upon protracted legal arguments developing in New Zealand jurisprudence in this respect would defeat the purpose of what many are seeking: both certainty and equity”. So in response to the second part of the member’s question, I would say certainly not, the suggestion is ridiculous.

💬 Hon Tau Henare: What does he think these criticisms mean in terms of finding a durable framework for consideration of foreshore and seabed claims?

💬 Hon CHRISTOPHER FINLAYSON: As I said in answer to the member’s supplementary question, Mr Goff seems to criticise the inclusion of tests to determine customary title but, as I said, that contrasts with what the submission to the ministerial panel by the Labour Party said. That said that the tests should be retained. Mr Goff also seems to think that we should just leave everything to the courts to decide, and again that contrasts with section 96 of the Foreshore and Seabed Act and Labour’s 2008 agreement with Ngāti Porou. So it is very hard to find out where the Labour Party stands on all this sort of thing. It is about as consistent as vomit.

💬 Mr SPEAKER: I think the last part of that answer went over the top.

💬 Hon David Parker: Will the Minister agree to amend the Government’s bill so as to require that any proposed agreement between Ministers and claimants to confer customary title under that bill would be referred to the courts for ratification as is currently required under the Foreshore and Seabed Act for negotiated agreements under that Act?

💬 Hon CHRISTOPHER FINLAYSON: Although the negotiated agreements deal with foreshore and seabed reserves, what I have said all along is that when the submissions have been concluded I will have a good look at them, and if there are issues that need to be addressed, they will be addressed. That is the sensible thing to do when one is dealing with submissions that are still being heard by the select committee. I know that, for example, Waikato-Tainui and Ngāti Porou are yet to make their submissions to the select committee.

💬 Hon John Boscawen: What does he make of Mr “Quinten” Hay’s submission on the bill, or has he not bothered to read it?

💬 Hon CHRISTOPHER FINLAYSON: I think the member probably means Mr Quentin Hay, who is a former partner of mine in Bell Gully. If that is the person, I have not read it but I certainly will. Then I will give the member my considered view.

💬 Hon John Boscawen: Was Mr Quentin Hay correct in his submission when he said that the Attorney-General must have been misreported in the comment—

💬 Mr SPEAKER: The Minister has no responsibility whatsoever for answering whether someone was correct. The member can ask about his opinion on certain things but he cannot ask him to accept responsibility as to whether someone is correct, when the Minister has no responsibility for that person whatsoever.

💬 Hon Trevor Mallard: I think that the second clause of the member’s question brought it in, because it went to whether—

💬 Mr SPEAKER: I was about to let the member rephrase his question. I ask John Boscawen to rephrase his question to bring it within the Standing Orders.

💬 Hon John Boscawen: Does the Attorney-General agree with Mr Quentin Hay, who said the Attorney-General must have been misreported in the comment that ministerial deals provided for in clause 93 are akin to the settlement of a private dispute, because the Attorney-General’s argument is “fallacious”?

💬 Hon CHRISTOPHER FINLAYSON: That sounds like Mr Hay. No, as I have said, I have not read the submission. With the greatest of respect to Mr Boscawen, I am always very wary of listening to selective quotation. I will read the submission and then I will give him my considered view.

Social Services—Contract Mapping

10. to the Minister for Social Development and Employment: How is the Government improving transparency of taxpayer-funded social services?

on behalf of the Minister for Social Development and Employment: Today the Government launched contract mapping, a new tool that locates Government funding across New Zealand. The website uses Google Maps to pinpoint every social service provider in the country. We are able to see who gets the money, what it is for, how much they get, and where we can find them. This tool means that policy makers, communities, and Ministers can immediately see where services are funded, and will be able to identify gaps and overlaps in the community.

💬 Katrina Shanks: How will contract mapping contribute to the Government’s priority of having coordinated social services?

Significantly. Currently we have the Ministry of Social Development’s contract map. Early next year we will also add the Ministry of Justice, the Ministry of Health, the Ministry of Education, and Te Puni Kōkiri.

Neurosurgery Services—South Island

11. to the Minister of Health: Is he confident that the announcement of 10 November regarding neurosurgery services in the South Island will provide a sustainable service?

I have been assured that the configuration of the South Island neurosurgical services recommended by the expert panel is sustainable. Having said that, building the service will not happen overnight. A number of things have to click into place, such as staff being recruited at both the university and the district health board level.

💬 Hon Ruth Dyson: What was his response to the letter from Canterbury neurosurgeon Ronald Boet stating that he would resign if the announced model was imposed on him?

💬 Hon TONY RYALL: I do not recall receiving that letter. My comment would be that the important thing we need to do for the South Island is to have a service that is sustainable and that will provide for the future. That certainly is the recommendation that has come from the independent panel, and I think that would be very good for New Zealand. I know that policy has been welcomed by the member’s two colleagues from Dunedin.

💬 Hon Ruth Dyson: What was his response to the letter from Canterbury paediatric neurosurgeon Martin MacFarlane stating that he would retire from his profession if the announced model was imposed on him?

💬 Hon TONY RYALL: I am aware that a number of people around the countryside may not be happy with what is being proposed, but let us remember that the reason why this review was started was that the doctors could not agree and the district health boards could not agree. That is why a decision was made. If the member opposite is saying that the Labour Party’s position is that it wants a one-site service run from Christchurch, then I find that very interesting.

💬 Hon Ruth Dyson: Why will children from the whole of the South Island have to travel to Auckland for neurosurgery; and does he care enough about them to act on their behalf?

💬 Hon TONY RYALL: I do not think that all the children of the South Island will have to travel to the North Island for their neurosurgery. This is about providing a sustainable service for the people of the South Island. That is why it has been strongly endorsed by her colleagues from Dunedin.

Legal Aid, Public Defence Service—Progress

12. to the Minister of Justice: What progress has been made on the roll-out of the Public Defence Service?

I recently officially opened the Papakura-Pukekohe Public Defence Service. Its opening was significant because it marked the completion of the roll-out of the Public Defence Service across the entire Auckland region. A formal evaluation of the Public Defence Service and feedback from judges, practitioners, and court staff indicate that the Public Defence Service is operating well. It continues to provide clients with as good a level of legal representation as they would receive from the private Bar. It has led to a significant reduction in the number of jury trials, court time, and costs.

💬 Chester Borrows: What plans, if any, does the Minister have to expand the Public Defence Service to other locations? [Interruption]

💬 Mr SPEAKER: Before I call the Minister, I say that I just could not hear the question, because of the interjections from across the front bench. Would Chester Borrows mind repeating his supplementary question for me, please.

💬 Chester Borrows: What plans, if any, does the Minister have to expand the Public Defence Service to other locations?

💬 Hon SIMON POWER: I am pleased to report that the Public Defence Service is expected to be up and running in the Wellington, Lower Hutt, and Porirua courts early next year, and in Hamilton and Christchurch by the middle of next year.

Questions to Members

Question Nos 1 and 2 to Members

Questions, by leave, withdrawn.

Marine and Coastal Area (Takutai Moana) Bill—Submissions Received

3. Hon PAREKURA HOROMIA (Labour—Ikaroa-Rāwhiti) to the Chairperson of the Māori Affairs Committee: How many submissions have been received on the Marine and Coastal Area (Takutai Moana) Bill?

Four thousand, one hundred and seventy-eight.

Marine and Coastal Area (Takutai Moana) Bill—Requests for Oral Submissions

4. Hon PAREKURA HOROMIA (Labour—Ikaroa-Rāwhiti) to the Chairperson of the Māori Affairs Committee: How many submitters on the Marine and Coastal Area (Takutai Moana) Bill have requested to be heard in person?

Five hundred and twenty-two.