Questions for Oral Answer

1. to the Minister for State Owned Enterprises: Why is the Government proposing to sell shares in State-owned enterprises?

No decision to sell shares has been made. Treasury is providing advice on whether extending the mixed-ownership model can meet the five tests that the Prime Minister has already outlined: retaining majority control by the Government, prioritising New Zealand shareholders, providing good investments, using capital to purchase other public assets and limit debt increases, and protecting New Zealand consumers.

💬 Hon Clayton Cosgrove: Does he agree with Treasury advice that “there is little evidence to suggest that privatisation would significantly improve the financial performance of many of the SOE companies.”; if not, why not?

💬 Hon TONY RYALL: No, I do not agree with that advice; because when one looks at what the Government may be considering in the future, one can see that it is not a reflection of what that evidence may have been based on.

💬 Hon Clayton Cosgrove: Given that he does not accept Treasury’s advice on improving the performance of State-owned enterprises, whose advice is he taking, or can we assume that his proposals are based on ideology rather than analysis?

💬 Hon TONY RYALL: The Government has asked Treasury to provide advice on whether extending the mixed-ownership model can meet the five tests that the Prime Minister has already outlined. It is quite clear that we cannot continue borrowing at the current levels, so the Government wants to look at where we can change the mix of the assets that we own. The greatest scope to change this mix lies in the Government’s commercial assets. It is crazy to remain locked into an ownership model of the past, which may constrain the future of New Zealand.

💬 Hon Clayton Cosgrove: Does he agree with the statement of the previous Minister for State Owned Enterprises that the Government “will prioritise New Zealand shareholders”; if he does agree, can he guarantee to the House that the bulk of any floated shares in a partly privatised State-owned enterprise will remain in the hands of Kiwi mums and dads?

💬 Hon TONY RYALL: The matter is still being scoped and advice is being provided to us by our advisers. What I can say is that there is an absolute guarantee that the Government will be retaining 51 percent ownership of any asset that the Government may consider having a public float of.

💬 Hon Clayton Cosgrove: Given that the Minister has said he has sought departmental advice on the partial sale of State-owned enterprises, when does he expect to receive that advice, and is he expecting that advice to contain a mechanism to ensure that State-owned enterprises stay in the hands of Kiwi mums and dads, as his Prime Minister has previously stated?

💬 Hon TONY RYALL: The Prime Minister has made it absolutely clear that in the consideration that has been given to this matter, ownership will be retained in the hands of the Crown to the proportion of at least 51 percent.

Budget 2011—Focus

2. to the Minister of Finance: How will the Budget next month progress the Government’s programme to build faster economic growth based on savings, exports, and productive investment?

on behalf of the Minister of Finance: The Budget next month will be about pressing on with the Government’s extensive economic programme to build a platform for faster sustained growth. It will have two main themes: focus on increasing savings and investment, and on the rebuilding of Christchurch. It will be a balanced and responsible Budget for the times. The two Canterbury earthquakes and a number of other setbacks such as finance company failures are significant and expensive, but they do not materially change the Government’s wide-ranging economic programme, which will build long-term growth by having a tax system that rewards hard work, an infrastructure programme that removes economic bottlenecks, a regulatory framework that helps businesses grow, reforms to improve front-line services in the public sector, an education and skills system that deliver real results, and encouragement of business to trade and innovate.

💬 Michael Woodhouse: How will the Government incorporate the costs of the Canterbury earthquakes into the Budget and into its wider economic programme?

First of all, although the earthquakes were very large events, we need to keep their economic effects in perspective, and it is important that we do not overreact. Events like the earthquake, and support for AMI Insurance policyholders, and finance company failures, certainly come at a significant cost to New Zealand. But they are one-off events. They will amount to several billion dollars over the next 4 or 5 years, whereas the Government currently spends about $70 billion a year, and New Zealand’s annual GDP is around $200 billion. The Government will meet its share of these costs by initially borrowing a bit more in the next year or two, and carefully look to its spending priorities so we can get back to surplus and start repaying our debts.

💬 Michael Woodhouse: Why should New Zealanders be optimistic about the economic outlook for the next few years?

There are very many reasons for New Zealanders to be optimistic, and here are a few. Export prices are at record levels—up 30 percent in the past year, according to the ANZ commodity price index—New Zealand’s merchandise trade jumped 10 percent from 2010, interest rates are at 45-year lows, underlying inflation remains low at around 2 percent, real after-tax wages have increased by 10 percent since September 2008, we have very competitive tax rates, and forecasters expect economic growth to push above 4 percent next year. Finally, the main reason for New Zealanders to be optimistic is that they have a Government that rejects the crazy idea that the answer to every economic problem is outrageous spending promises that we cannot afford.

💬 Hon David Cunliffe: How can the Government claim to be building on its programme for growth, when GDP per capita has gone backwards nearly every quarter since it took office?

I think the answer to that is reasonably easy. We had incredibly poor economic management through the first 9 years of the 21st century, and the Government is now turning that round. I remind the member that this country was in recession before the global financial crisis.

💬 Hon David Cunliffe: If the Minister is so confident about his handling of major economic decisions, why has he chosen to release hundreds of documents on South Canterbury Finance on the afternoon of the last sitting day before an adjournment, including Treasury email No. 2044105, dated 13 September, which indicates that the Minister faced a potential conflict of interest over the sale of South Canterbury Finance’s dairy holdings interests?

I think the member will find that those papers were released by Treasury this afternoon.

Doctors—Retention

3. to the Minister of Health: To what does he attribute the reported 300 percent increase in doctors leaving New Zealand for Australia since 2010?

I attribute those reported comments to a single medical recruitment company that is in the business of attracting clients. The flow of doctors in and out of New Zealand is a longstanding challenge, for a number of reasons, and is ongoing in some specialties in particular. The latest comprehensive data has confirmed that since November 2008 we have over 500 extra doctors and over 1,000 extra nurses working in the New Zealand public health service.

💬 Grant Robertson: What responsibility does he take as Minister for reports that the New Zealand medical workforce is “critically understaffed” as a result of doctors heading to Australia, and that as a result doctors in New Zealand have workloads that are “extremely unsafe”?

💬 Hon TONY RYALL: The latest comprehensive data, as I said earlier on, would indicate that since November 2008 we have over 500 extra doctors and over 1,000 extra nurses working in the New Zealand public health system. If we had an outflow of doctors of the level that that member may be suggesting, we would not have that level of increased front-line staff in our hospitals. Having said that, there are challenges remaining in a number of important specialties.

💬 Grant Robertson: Has he received advice on the reports that doctors who are leaving to go to Australia for short periods are now moving there permanently; if so, what did that advice say?

💬 Hon TONY RYALL: I do not recall getting any specific advice suggesting what the member opposite has suggested. I do know that we have increased numbers of doctors and nurses working in the public health service. For example, in the last 2 years of the National Government, the number of doctors working at the Auckland public hospital has increased by 148, and the number of nurses by 242.

💬 Grant Robertson: Does he recall the statement in 2008 from the then National spokesperson on health, a Mr Tony Ryall, that National’s policies would slow “the flood of health professionals to Australia”, and given the 300 percent increase in doctors going to Australia in the last year, how would he rate his progress?

💬 Hon TONY RYALL: First, I would strongly dispute basing a claim on the comments of a medical recruitment company that is seeking to attract clients. The fact is that if there had been a threefold increase in the number of doctors leaving New Zealand, we would not have increased the numbers of doctors working on the front line in our public hospitals by 500, nor would we have 1,000 extra nurses working in our public hospitals.

💬 Grant Robertson: Does he consider he is adequately funding the health system to retain doctors in New Zealand, or would he agree with the words of former Prime Minister Mike Moore: “When Tony Ryall talks of health issues, am I the only person who hears the theme music from the ‘Jaws’ movie?”

💬 Hon TONY RYALL: That is so last century.

💬 Grant Robertson: I seek leave to table a column by former Prime Minister Mike Moore, dated 6 February 2008—this century.

💬 Mr SPEAKER: Leave is sought to table the document from 2008. Is there any objection? There is objection.

Question time interrupted.