Questions for Oral Answer

1. to the Minister of Finance: What reports has he received on the economy?

More good news. This morning the Reserve Bank issued its Monetary Policy Statement. It confirms the early signs of an economic recovery. GDP has probably increased modestly through the first half of 2011, despite the impact of the Christchurch earthquake. The bank expects the pace of growth to pick up, supported by high commodity prices and a number of other factors, including the earthquake rebuild. Businesses are expected to increase their staff hiring and capital investment.

💬 Amy Adams: What are the Reserve Bank’s economic growth forecasts for the next few years?

💬 Hon BILL ENGLISH: It is predicating GDP growth of 1.2 percent in the year to March 2011, 2.5 percent in the next 12 months, and 4.6 percent to March 2013. The expected growth in export volumes has remained about the same as the central bank projected in March. Private consumption growth has been revised upwards. These forecasts are about the same as, if not slightly more positive than, the Treasury forecasts in the Budget.

💬 Hon David Cunliffe: Is he aware that the Governor of the Reserve Bank has just confirmed to the Finance and Expenditure Committee that the only reason that the Reserve Bank is more optimistic than his own officials is the high commodity prices, which themselves are surrounded by downside risk?

💬 Hon BILL ENGLISH: The fact that our terms of trade are about the highest that they have been in a long time is a reason for optimism, and of course there is a risk that commodity prices could drop back. I think the more important point is that the Reserve Bank forecasts are roughly the same as Treasury’s forecasts, which are roughly the same as those of most other economists. The Opposition’s assertion that the forecasts are widely optimistic is probably overly pessimistic.

💬 Amy Adams: How do the Reserve Bank economic growth forecasts compare with the Treasury forecasts that accompanied the Budget last month?

💬 Hon BILL ENGLISH: The Reserve Bank’s forecasts are a bit stronger than Treasury’s. They forecast 2.5 percent growth in the next year, whereas Treasury forecasts 1.8 percent. But I must say that forecasts do not make an economy grow. What makes an economy grow are the decisions that New Zealand households and businesses make, and my sense is that they are becoming increasingly confident, but not overconfident, about the prospects for this economy. That is more important than the forecasts.

💬 Hon David Cunliffe: Does the Minister agree with commentary in the New Zealand Herald and on www.interest.co.nz, which says nothing is being done to correct the current account imbalance, nothing is being done to correct the growing international debt, nothing is being done to create jobs, and it is time that someone did something?

💬 Hon BILL ENGLISH: No, I do not, and I am still waiting to see what the “something” is.

💬 Amy Adams: What is the Reserve Bank’s outlook for job growth over the next few years, and what measures is the Government taking to support new jobs?

💬 Hon BILL ENGLISH: Again, the Reserve Bank is expecting about the same level of job growth as was forecast in the Budget, which is around 35,000 new jobs a year. That is actually not exceptional for New Zealand; that was the average rate of job creation for the 15 years from 1990 to 2005. The Government is doing everything it can to give businesses the confidence to invest, grow, and create new jobs. The indications are that the combination of positive leadership from the Government and a sound Budget is helping with business confidence.

KiwiRail—Minister’s Statement

2. to the Minister of Transport: Does he stand by his statement on TVNZ’s Close Up on 3 May 2010 regarding KiwiRail workers that “There will be lots of work for these guys, there’s no doubt about that, because they do a lot of things well and there’s a big rolling stock replenishment and replacement exercise that’s coming down the pipeline”; if not, why not?

Yes, I do; and I also stand by the rest of that quote, which states “you can’t make these things conditional to the deal. The point I was making about KiwiRail a few weeks ago is that the reality is this rail company has been treated like a Cinderella in this country for a long, long time, with all sorts of political things about what it should do and what it shouldn’t do, which don’t necessarily”—

💬 Mr SPEAKER: The question was a fairly simple question. It just asked whether the Minister stood by his statement. He went on to say he stood by the rest of it, but I sense then he started to get into some political comment that was not actually required by the question.

💬 Hon STEVEN JOYCE: I raise a point of order, Mr Speaker.

💬 Mr SPEAKER: I will hear the Minister.

💬 Hon STEVEN JOYCE: No, I was not, Mr Speaker. That was the actual total quote. I was just reading back elements of the rest of the quote. The quote in the question was taken out of context and I thought I would read the rest of the quote.

💬 Mr SPEAKER: I apologise to the Minister if I stopped him, but I think he had read a fair part of the—

💬 Hon STEVEN JOYCE: There is a very important part of the quote that I was not able to get to that is pretty relevant to the member’s question.

💬 Mr SPEAKER: The question asked whether the Minister stood by this statement, and if he did not stand by it, he was asked why not. The question could be answered yes. Of course, Ministers are allowed to indicate where a quote is taken out of context, but they should not go on reading forever. But on this occasion I will let the Minister finish the quote.

💬 Hon STEVEN JOYCE: Thank you, Mr Speaker. The remainder was: “And I believe strongly that if we’re going to turn KiwiRail around—and it’s a big turnaround project—then we actually have to let them make the commercial decisions that they need to make.”

💬 Dr Russel Norman: Does the Minister regret the fact that as a Minister of the Crown he effectively gave these workers a guarantee that they would have a job—and they may have made certain commitments to mortgages and so forth—and today 70 workers have lost their jobs, in spite of the assurance from the Minister that their jobs were secure?

💬 Hon STEVEN JOYCE: No, and I do not think the member’s characterisation is at all fair, as I indicated by reading the rest of that quote. I certainly acknowledge the uncertainty and concern that the affected workers will have, which occurs whenever these sorts of changes take place in any organisation. However, it is important that we let KiwiRail make its own commercial decisions, if it has the chance to turn round and become successful. We cannot place requirements on KiwiRail that we do not place on any other New Zealand company.

💬 Dr Russel Norman: If the Minister believes that it is important to give KiwiRail the freedom to make its own commercial decisions, can he confirm whether he or any other Ministers discussed with the chair of KiwiRail the implications for any of our free-trade agreements were the contracts to end up with an overseas company versus a New Zealand company?

💬 Hon STEVEN JOYCE: I can confirm that I did not.

💬 Dr Russel Norman: I raise a point of order, Mr Speaker. The question asked whether he or any other Ministers had discussed it. He answered the question in regard to himself. Is he aware of any other Ministers discussing it?

💬 Mr SPEAKER: The Minister is entitled to answer it for himself. I do not think he can answer for other Ministers.

💬 Dr Russel Norman: In the light of his comments that KiwiRail does do a lot of things well and that there is a big rolling stock replenishment, why, then, is KiwiRail losing 70 jobs today from its Hillside workshop in Dunedin?

💬 Hon STEVEN JOYCE: KiwiRail has a massive number of investments scheduled over the next 10 years as we seek to turn that organisation round as part of the $4.6 billion turn-round plan. So there is a huge amount of work across that organisation, which I note has 4,200 staff, or thereabouts. Again, it is very important that we allow KiwiRail to make its commercial decisions about individual elements of its organisation. We do not place the sort of requirement that the member seems to be suggesting on any other New Zealand company. If we want to make KiwiRail successful—and I suspect that the Greens do, because they are big fans of rail—then we have to allow it to get on and make its appropriate decisions.

💬 Hon David Parker: Can the Minister not see the inconsistency between his Government’s refusal to allow KiwiRail even to tender to build rolling stock and the Government’s $35 million subsidy in this year’s Budget for farm irrigation, and was he involved in any cost-benefit analysis to show whether investing that money in the Hillside workshop would have been better than a further subsidy to the farming sector?

💬 Hon STEVEN JOYCE: I reject the member’s suggestion. We did not say to KiwiRail that it could not bid for the work. It has bid for some work, and, in relation to the work that it did not bid for, it made its own decision. The reality is that the Greens and Labour are playing politics with this issue. They had one big train contract when they were in Government, and they gave it to Korea, to build the Matangi trains. Now they are in Opposition it is suddenly all different, and I think we can call that petty politics and crocodile tears.

💬 Dr Russel Norman: It certainly was not us.

💬 Mr SPEAKER: Order!

💬 Dr Russel Norman: With regard to the Minister’s approach that it is a singular commercial decision for KiwiRail, has the Government considered the whole-of-economy approach in this issue, and has he looked at the Business and Economic Research Ltd report, which looked at whole-of-economy benefits? Were these contracts to be let in New Zealand, the benefits would be not just to KiwiRail but to all of New Zealand.

💬 Hon STEVEN JOYCE: The Business and Economic Research Ltd report, as I think we discussed in this House at the time, had a number of large issues with it in terms of the assumptions it was able to draw. The member seems to be suggesting rejecting the whole principle of trade and specialisation to allow countries to get ahead. The reality is that every country specialises in certain areas and trades with other countries. He seems to be suggesting a return to Fortress New Zealand, which is fine for him but I suspect it would not be good for any other New Zealander.

💬 Dr Russel Norman: If the Government really believes that it should be left to the market and to trade and specialisation, why does the Government have such an inconsistent approach? On the one hand, KiwiRail tenders the contract to whomever; on the other hand, when it comes to intensive agriculture and irrigation, the Government has very, very large subsidies to that industry.

💬 Hon STEVEN JOYCE: I do not see the connection. Obviously, Mr Parker and Dr Norman got together at lunchtime and cooked that one up. I do not see the connection at all. What I can tell members once again is that it is very important that politicians stop making political demands on what is a struggling organisation, so that we can turn it round and make it a success in New Zealand.

Parents Inc.—Funding

3. to the Prime Minister: Has he given Parents Inc. an undertaking to give them money?

on behalf of the Prime Minister: No.

💬 Hon Annette King: In light of that answer, on what did he base his comments before the election that Parents Inc. delivered fantastic results and he was going to “make sure they get some money to run their programmes far and wide,”?

The member will appreciate that those comments were made by the Prime Minister in his capacity as the then Leader of the Opposition. But he has made no secret of his support, which I share, for a group that has for the last 15 years educated parents and communities up and down this country, in courses attended by very large numbers of people.

💬 Hon Annette King: What discussions did he have with the Minister of Finance about providing funding to Parents Inc., and why was this organisation singled out before the election as worthy of funding by the then Leader of the Opposition, even before an application was made?

There were no discussions with the Minister of Finance. In fact, the decision was made in the Ministry of Social Development, I presume with some attention from the Minister for Social Development and Employment. It is actually not unusual at all for decisions to be made to contract social service providers without going through the Ministry of Economic Development tendering system.

💬 Hon Annette King: Why did the Government approve $2.4 million untendered to Parents Inc. for a parenting programme, when the evaluation of it was not completed and the complete sample, which was to be provided by December 2010, was never compiled or received?

That decision was made within the Ministry of Social Development. But I am interested that the Labour Party just hates anyone who goes out and talks to New Zealanders in a way that is not—

💬 Mr SPEAKER: The question asked why a certain decision was made; it did not actually invite an answer on whom the Labour Party hates or loves. That is not in order.

💬 Hon Annette King: Why did the Government—[Interruption]

💬 Mr SPEAKER: I expect the House to extend some courtesy.

💬 Hon Annette King: Why did the Government use an incomplete evaluation—one that had such a low response from parents using the parenting programme—as its justification for giving $2.4 million to Parents Inc., which the Minister for Social Development and Employment did earlier this month?

That member will know, because she was a Minister in the previous Government, that most Government spending is not fully evaluated. A lot of it might struggle to pass an objective evaluation according to any particular measure of political correctness that the Labour Party might apply to it. The fact is that this organisation has for 15 years educated parents around New Zealand in very large numbers. It probably has a better track record on parenting education than any organisation in the rest of the country.

💬 Hon Annette King: Is he aware that the researchers his Government relied on in handing over the $2.4 million of taxpayers’ money, untendered, had such a low response from the survey of parents that they decided they needed to incentivise the parents by offering them either a 16-piece Maxwell and Williams fine bone china teaset or three books, but they still failed to complete the sample?

Is the Opposition now saying that the researchers were stupid, or that there is something wrong with the course? I think they need to make up their minds. But I invite the Opposition to go to any suburb of Hamilton or Palmerston North and tell people they think that Parents Inc. gets it all wrong. In fact, that organisation would be regarded as a bit more of an expert on parenting education than the bureaucracy or the overfunded Families Commission.

💬 Hon Annette King: Is he aware that despite the Government allocating $2.4 million to Parents Inc. for its parenting programme, parents have to pay up to $90 a course; and how many low-income parents, who are already feeling the effects of rising costs, will be able to afford that amount?

Given the choice between believing that member’s assertion and the Minister, I believe the Minister.

💬 Hon Trevor Mallard: I raise a point of order, Mr Speaker. Do I actually need to indicate what it is? I mean, the Minister has indicated there is a question about whether he believes a statement made by a member in this House. Mr Speaker, you know that he cannot do that.

💬 Hon Simon Power: It is a regular occurrence for the member who has just resumed his seat to yell from that side of the House: “Tell the truth. Tell the truth.”, which would seem to get us into the same territory that he is now complaining about in respect of that comment.

💬 Mr SPEAKER: I think the matter can be dealt with fairly simply. When members make statements in questions, they risk those statements being refuted by Ministers. It seems to me that the Minister was making it fairly plain that he disagreed totally with the statement contained in the question. He was doing it in a fairly robust way, and I have no problem with that. This is the danger that members face when they put claims or allegations into a supplementary question in an area of some interest. Where strong political views are held, they can get strong political answers.

💬 Hon Annette King: I seek leave to table a paper from Parents Inc.’s website, which sets out the cost to parents for its parenting programme, Toolbox.

💬 Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is no objection.

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

💬 Hon Trevor Mallard: What lessons has the Government learnt from the Treasurer’s exercise with the Pacific Economic Development Agency, which was about giving money to people with whom it was associated—lessons that have been applied to this project, which again has given money, over $2 million without tender, to its friends?

Those statements are unbelievable, coming from a former Minister of a Labour Government. Fancy a Government giving money to people that it knew—the previous Labour Government specialised in it! In fact, the $2.4 million is to pay the $90 fee so that foster parents, whom that Government left unsupported with the most vulnerable children in New Zealand, can actually get some support. Labour should actually apologise for its record of failure to support foster parents and to get decent parent education out in New Zealand.

💬 Hon Annette King: I seek leave to table research prepared by Point Research into Parents Inc.’s Toolbox. It is an evaluation that was uncompleted but used by the Government to give money to its mates.

💬 Mr SPEAKER: The member will get to her feet, and withdraw and apologise for that last statement. I will not have the point of order process abused like that. There is nothing wrong with seeking leave to table a document, but that last statement will be withdrawn and the member will apologise.

💬 Hon Annette King: I withdraw and apologise. I raise a point of order, Mr Speaker.

💬 Mr SPEAKER: No, we are seeking leave now to table the document.

💬 Hon Annette King: Yes, I am seeking leave.

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

💬 Hon Annette King: I raise a point of order, Mr Speaker. Will you ask the Deputy Prime Minister to withdraw and apologise for the comments he made about me?

💬 Mr SPEAKER: I will not, because the member knows that she made that comment under a point of order, when she was seeking the leave of the House. That is quite a different process from answers to questions or any other process, and it will not be abused.

💬 Hon Trevor Mallard: I raise a point of order, Mr Speaker. What remedy does a member have immediately when a member is called a liar—

💬 Mr SPEAKER: The member will resume his seat right away. This nonsense will stop; it is just petty and pathetic. Members will notice that earlier on I pulled the Minister up when a straight question was asked and he went on to make some comment about the Labour Party. I pulled him up; I stopped him. I cannot run this House in the way that one party may wish it to be run; I have to run it absolutely fairly to all parties. I stopped the Minister when he started to abuse the Labour Party—I stopped him in his tracks. But given some of the questions asked and the implication in questions—I heard the question ask whether money was being given to friends—I do not blame the Minister for giving a pretty robust answer. If members do not like to receive robust answers, they should be careful about the questions they ask.

Contaminated Sites, Tūī Mine—Clean-up Funding and Plan

4. to the Minister for the Environment: What response has there been to the Government’s announcements on contaminated sites, and in particular the planned clean-up of the most dangerous site at the Tūī Mine on Mt Te Aroha?

The announcement of the funding and plan has been welcomed by the district and regional councils, by the community, and by local iwi. I acknowledge the strong advocacy of that member for the risk of this unstable tailings dam to be addressed, and also the work of the Green Party, as a result of which our memorandum of understanding includes work to stabilise and make safe this particularly dangerous contaminated site.

💬 Sandra Goudie: What lessons have been learnt from the last major contaminated site clean-up, at Māpua, which resulted in a very negative report from the Parliamentary Commissioner for the Environment and significant concern by local residents, to ensure that the clean-up of the Tūī Mine is properly managed?

💬 Hon Dr NICK SMITH: It is widely accepted that there were significant failings by the previous Government in the Māpua clean-up. I am pleased to assure the member that we are taking a quite different approach. The ministry is funding the project but not managing it on a day-to-day basis. The ministry does not have the appropriate skills—nor is it realistic—to project-manage a complex job like this from Wellington. The technologies being employed have been successfully tried and tested, and we have also put effective monitoring in place. These projects are notoriously difficult, but I am satisfied we are applying world best practice.

💬 Catherine Delahunty: Tēnā koutou e te Whare. Will the Minister consider further funding for bioremediation of toxic sites, given the successful model of clean-up being piloted at contaminated timber treatment sites in Whakatāne?

💬 Hon Dr NICK SMITH: Firstly, I want to acknowledge the very constructive work of that member on the issue of contaminated sites and the progress we have been able to make in respect of the Tūī Mine. In respect of her specific question, yes, the ministry has a contestable fund for assisting sites like those in Whakatāne, which she has raised. Funding would be considered on merit, relative to other applications. In terms of any specific technology, I would need to rely on expert advice as to whether it was the best way in which to ensure that the sites she refers to remain safe.

💬 Te Ururoa Flavell: Kia ora tātou. Was the pentachlorophenol poisoning and E. coli in Rotorua’s Puarenga Stream included in the Government’s announcement on contaminated sites; if not, what action will the Minister take to ensure this issue is addressed?

💬 Hon Dr NICK SMITH: The member has raised, as he did in my recent visit to Rotorua, the specific issues of that stream. That is more majorly an issue of water quality, and there are some technical questions as to where the source of contamination is coming from: whether it is the previous timber treatment site up the catchment, whether it is the previous sewerage works, or whether there are other activities in that catchment that are causing it. When we get the technical advice from Environment Bay of Plenty as to the source of that contamination, we will decide whether it is a contaminated site or whether we have a water clean-up issue on our hands.

Budget 2011—Early Childhood Education

5. to the Minister of Education: Why has the Government budgeted an additional $550.3 million for early childhood education over the next 4 years?

Because the Government believes that early childhood education is a good investment for our young New Zealanders.

💬 Hon Heather Roy: Does she stand by her Budget day statement that early childhood education funding would focus on “increasing participation for Māori, Pasifika, and children from low-income families,”; if so, what is her best estimate of likely increases in participation rates for these groups from the extra half a billion dollars in funding?

💬 Hon ANNE TOLLEY: Yes.

💬 Hon Heather Roy: I raise a point of order, Mr Speaker. The question required much more than a yes or no answer, I would have thought.

💬 Mr SPEAKER: In fairness, the member asked whether the Minister could confirm, if I recollect correctly, that money was being allocated to certain groups, and then the member went on to ask, if that was so, how many children would benefit from it. The Minister, as she is entitled to do, answered the first part of the question. She said yes, that the funding was being targeted to those groups. The member has further supplementary questions should she wish to use them.

💬 Sue Moroney: How does her Government’s funding of early childhood education compare with the 1 percent of GDP spent on average by other OECD countries and recommended by UNICEF?

💬 Hon ANNE TOLLEY: This Budget 2011 provides an 11.5 percent increase in early childhood education spending from Budget 2010, even in the depths of a severe economic recession. I think that is an outstanding record from this Government.

💬 Sue Moroney: I raise a point of order, Mr Speaker. The question was quite specific. It was about the percentage of GDP spent on early childhood education.

💬 Mr SPEAKER: I will allow the member to repeat her question just to be certain, because I did not hear it clearly.

💬 Sue Moroney: How does her Government’s funding of early childhood education compare with the 1 percent of GDP spent on average by other OECD countries and recommended by UNICEF?

💬 Hon ANNE TOLLEY: If the member had put that question on notice, I could have found the percentage for New Zealand. However, I repeat that Budget 2011 provided an 11.5 percent increase over Budget 2010, even in the depths of an economic recession. I think that is an outstanding record.

💬 Sue Moroney: Why will early childhood education services that were paid $13.35 per hour per child under 2 years of age, prior to her Government’s funding cuts on 1 February this year, now receive only $11.93 per hour per child after her funding increase on 1 July, which is a funding reduction of $1.42 per hour per child?

💬 Hon ANNE TOLLEY: That member continues to misrepresent that this Government has cut early childhood education spending. In fact, this Government has continued to increase early childhood education spending. However, we did remove the incentive for centres to move from 80 to 100 percent qualified teachers in teacher-led services, and that has made a difference to the funding rates for some centres. That is because this Government has a goal of 80 percent qualified teachers in teacher-led services and we are on track to achieve that across all services next year.

💬 Hon Trevor Mallard: Does her Government spend more per child in early childhood education or on children in their first year at primary school?

💬 Hon ANNE TOLLEY: Yes, the average is higher—$7,600, I believe, is spent per child in early childhood education, and $5,500 on a child in primary school education.

💬 Hon Trevor Mallard: I raise a point of order, Mr Speaker. Just in case I did not make it clear, is this the first year at school?

💬 Mr SPEAKER: That is not a point of order.

💬 Hon Trevor Mallard: Were the figures that she just used the figures for the first year at school?

💬 Mr SPEAKER: The question was about early childhood education. The Minister may not have that information.

💬 Hon ANNE TOLLEY: Yes, I do not have that information. The average spent for a primary school student is less than the average spent on early childhood education.

💬 Sue Moroney: I seek leave to table the funding rates for early childhood education to 1 February 2011.

💬 Mr SPEAKER: What is the source of that information?

💬 Sue Moroney: It is from the Ministry of Education.

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

💬 Sue Moroney: I seek leave to table a document from the website of the Ministry of Education showing the funding rates for 2011 and the funding reduction for services down to $11.93 per child, per hour.

💬 Mr SPEAKER: Leave is sought to table that document from the Ministry of Education website. Is there any objection? There is objection.

💬 Hon Heather Roy: Can the Minister explain to the House how she can justify her claim that her 20 free hours policy is caring when low-income earners are often taxed at a marginal tax rate of between 53c to 102c in the dollar to subsidise the early childhood education of the children of high-income earners?

💬 Hon ANNE TOLLEY: This Government does not have any policy of 20 free hours. In fact, we came to Government and changed the name from 20 free hours to 20 hours early childhood education, because the previous Government had made it so that it was not free.

💬 Hon Sir Roger Douglas: Could the Minister confirm that her policy on 20 free hours is yet another example of the Government’s extremist policies, which force low-income families to pay high rates of personal tax in order to subsidise asset-rich and high-income families?

💬 Hon ANNE TOLLEY: I repeat that this Government has no policy of 20 free hours.

Budget 2011—Sales of State-owned Assets

6. to the Minister of Finance: Is the loss of future dividends due to his planned sale of State-owned assets accounted for in the forecast financial statements in his Budget, or is this cost listed as an unquantified fiscal risk?

The fiscal forecasts do not include an estimate of the specific transactions proposed under the mixed-ownership model. There are no forecast costs associated with the sale, and no reduction in dividend income or receipt of sale proceeds. Instead, it has been highlighted as a specific fiscal risk pending decisions. Included in the forecast is the Government’s intention to meet the cost of the next five Budgets’ capital allowance off the balance sheet—that is, a zero capital allowance. It is our broad intention that most of this will be funded by mixed-ownership model proceeds. It is worth noting that the Treasury believes that the ongoing operating impact of mixed ownership is likely to be broadly balanced, as any reduction in dividends is likely to be cancelled out by reduced interest payments.

💬 Hon David Cunliffe: When will the Minister present to the New Zealand public an accurate and detailed statement on the cost of asset sales, and will this be before or after the 2011 general election; or is he trying to keep the truth secret?

💬 Hon BILL ENGLISH: That would depend on how we measure the dividends. I notice that while the member and the Labour Party are going around saying the Government would be foregoing $700 million in dividends, if we remove the special Meridian Energy dividends to do with the sale of assets—Crown assets in Australia—under the Labour Government, the average total dividend for the energy companies, excluding Meridian Energy, was under $100 million a year. That is why I questioned yesterday where he got his $700 million figure from.

💬 Hon David Cunliffe: I am so glad the Minister asked me that because—

💬 Mr SPEAKER: No, no. The member will resume his seat. The member knows that that kind of commencement to a question will lead to disorder. He is not the first person to have done that today, but we need to try to avoid the temptation to make that kind of mistake.

💬 Hon David Cunliffe: Given the Minister’s previous comment, did he read the 2010 financial statements that bear his signature and clearly record that total dividends from State-owned enterprises and Air New Zealand were $831 million in that year; if so, why did he tell this House yesterday that “The true figure for dividends from State-owned enterprises is probably about $350 million,”?

💬 Hon BILL ENGLISH: Because I was using a roughly calculated average over the last 7 or 8 years. Under the Labour Government the energy companies, excluding Meridian, produced dividends of less than $100 million a year, which was a disgraceful return on taxpayers’ capital. It showed poor performance and sloppy governance.

💬 Hon David Cunliffe: Given that the Minister continues to dispute the actual figures released by the State-owned enterprises and compiled by the Parliamentary Library, can he confirm that the total dividend loss across the assets he is planning to sell, on a 5-year basis, is $281 million on a total basis, or $312 million per annum, on average, over the last 5 years, after inflation?

💬 Hon BILL ENGLISH: No. The member is picking a number. He could pick a different number. In 2009 total dividends from all State-owned enterprises were $223 million. As I said, the dividends, excluding Meridian’s large dividend from the sale of an asset in Australia, were less than $100 million a year. The State-owned enterprises were badly run under Labour. We have improved things. We are getting a better return on taxpayers’ money, and under the mixed-ownership model that will continue to improve. In the end, we are more interested in paying dividends to Kiwis than interest to foreign lenders, which is his party’s preference.

💬 Hon David Cunliffe: Is his lack of credibility in accurately booking the proceeds from unmandated asset sales, but not the full costs, one of the reasons why Standard and Poor’s has kept his Government’s credit rating on negative outlook?

💬 Hon BILL ENGLISH: No, but I know what Standard and Poor’s might be thinking if Labour got into power and said it was going to borrow a further $15 billion, which is the cost of the promises Labour has made so far, no doubt with more to come.

💬 Hon David Cunliffe: I seek leave to table data from the Parliamentary Library that shows the 5-year average of dividend flows from the share of assets the Minister is proposing to sell to be $281 million a year, on average, without inflation, or $312 million, inflation adjusted, per annum, on average.

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

💬 Hon BILL ENGLISH: I raise a point of order, Mr Speaker. I want to clarify something.

💬 Mr SPEAKER: I trust the member to make a genuine point of order.

💬 Hon BILL ENGLISH: I just want to clarify whether the figures include the special dividend from the billion-dollar - plus sale of an asset in Australia.

💬 Mr SPEAKER: That is really a debating point. Leave is sought to table the document from the Parliamentary Library. Is there any objection? There is no objection.

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

💬 Hon David Cunliffe: I seek leave to table a further document on dividends of State-owned enterprises paid to the Crown, which shows such data—

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

💬 Hon David Cunliffe: Again, it is from the Parliamentary Library and Treasury financial statements.

💬 Mr SPEAKER: Leave is sought to table that document prepared by the Parliamentary Library. Is there any objection? There is no objection.

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

Broadband, Ultra-fast—Health Services

7. to the Minister for Communications and Information Technology: What benefits will ultra-fast broadband services bring to health providers in New Zealand?

Health care services will make huge gains with the roll-out of ultra-fast broadband, which is why we are committed to providing fibre access to all registered health care centres in urban areas by the end of 2015. Faster connections will make the transfer of information and services much simpler and will reduce the tyranny of distance. By being able to deliver health services in new and innovative ways, we will be able to increase the quality of care that patients receive and reduce the costs of providing that care.

💬 Melissa Lee: What specific services will be able to be delivered over fibre in the future that cannot be delivered today?

💬 Hon STEVEN JOYCE: It is very exciting. Ultra-fast broadband will give medical practitioners, wherever their patients are, access to the country’s and the world’s leading researchers and specialists. Telehealth technologies will allow patients and medical staff to remotely monitor their health at home, whether it is diagnostic equipment connected to the hospital or consultations conducted in high-definition video. Another enormous benefit will be the ability to transfer medical files—for example, magnetic resonance imaging scans—at almost real time, rather than relying on slow downloads or a courier, which will save time, money, and, ultimately, lives.

Government Borrowing—International Situation

8. to the Minister of Finance: Does he believe that the Government should take a cautious approach to borrowing in light of “uncertainty and volatility in financial markets”?

Yes. That is why we are committed to reducing our borrowing over the next 4 years.

💬 Hon Trevor Mallard: Why is he then speculating on the fixed interest market by borrowing $100 million a week more than necessary?

💬 Hon BILL ENGLISH: It has been on the advice of the Debt Management Office. Because conditions are favourable up until the end of this month, the Government is borrowing more than is strictly necessary for its cash requirements. This means that over the next couple of years we will be borrowing less than is strictly necessary, and in the current international environment I think that is a good thing.

💬 Hon Trevor Mallard: Why is Treasury’s best estimate of the effect on the exchange rate and on jobs of this excessive borrowing?

💬 Hon BILL ENGLISH: It has not given a specific estimate of that. The member may well know that Treasury is generally opposed to almost any borrowing whatsoever.

Domestic Purposes Benefit—Proposed Changes

Tēnā koutou e te Whare. To the Minister for Social Development and Employment, does she consider bringing up babies to be meaningful, productive work; if so— [Interruption] Excuse me—

💬 Mr SPEAKER: I apologise. The Speaker will deal with the matter. I ask both members to please stop this inane interjection across the front of the House.

9. to the Minister for Social Development and Employment: Does she consider bringing up babies to be meaningful, productive work; if so, why is she considering making young mothers on the domestic purposes benefit seek paid employment when their youngest child turns one?

Yes to the first part; to the second part, the Government is looking at a number of recommendations from the Welfare Working Group, one of which is how to work with the one in four women who have another child while on the benefit.

💬 Catherine Delahunty: Will a mother fail a work test if she refuses to accept a minimum wage job that does not pay enough to cover her childcare costs?

💬 Hon PAULA BENNETT: That is a hypothetical situation. The member is talking about changes that might be made in the future, and I cannot comment.

💬 Catherine Delahunty: How will she ensure that young mothers forced into jobs with inflexible hours and conditions are still able to breastfeed their babies, or does she expect them to stop?

💬 Hon PAULA BENNETT: As I said, there are a number of recommendations that the Government is currently looking at. She is giving scenarios that are not currently part of this Government’s policy.

💬 Catherine Delahunty: Does she agree that training and upskilling, including studying at university, is a proven and successful path for young mothers to get off the domestic purposes benefit and into high-paying work; if so, why did she kick out the ladder behind herself and axe the training incentive allowance for degree-level courses?

💬 Hon PAULA BENNETT: I believe there are many pathways for many different mothers. That pathway is still there for them, and we are seeing many successes for many of them.

💬 Hon Annette King: Has she requested that those working at the convenient care clinics consider administering contraception to women on the domestic purposes benefit?

💬 Hon PAULA BENNETT: I speak to a number of people up and down this country. I speak to them about contraception issues and how we can help those women to have better choices in their lives. I am sure I have spoken to the Rotorua convenient care centre that I think the member is talking about contraception issues quite often.

💬 Hon Trevor Mallard: What guarantee can she give that no child between the ages of 1 and 5 will be abused while being cared for by a boyfriend when the mother has been forced out to work and she cannot afford to pay childcare costs?

💬 Hon PAULA BENNETT: What a ridiculous question.

💬 Hon Trevor Mallard: I raise a point of order, Mr Speaker. If it had been a ridiculous question, you would have ruled it out.

💬 Mr SPEAKER: The question was hypothetical, but I think it should not be answered by saying it is a ridiculous question. I invite the Minister to answer it in a rather more parliamentary manner than that. The question was hypothetical; I fully accept that. The Minister may not have liked the question, but I do not think it is appropriate to tell a questioner that the question is ridiculous if it is in order.

💬 Hon Trevor Mallard: I raise a point of order, Mr Speaker. Notwithstanding the fact that you have just, I think, supported my point of order, I was asking for a guarantee. It was not a hypothetical question.

💬 Mr SPEAKER: The member knows that what he was asking for there is something that cannot be sought in this House for something that is not even in place. There is no way that Ministers can give such guarantees, but I think a more respectful answer is required.

💬 Hon PAULA BENNETT: At the moment 68 percent of partnered women work while their children are in care, and 50 percent of sole parents currently work with their children in care. They are cared for by a number of different people, and I give no guarantees about what happens with regard to those children, either.

Budget 2011—Minister of Health’s Statements

10. to the Minister of Health: Does he stand by all his answers to oral question number 5 yesterday?

Taken within the context of the questions, yes.

💬 Grant Robertson: Can he therefore confirm that the advice of his ministry was that funding of $576 million was required for demographic and population growth for Vote Health in 2011-12?

💬 Hon TONY RYALL: That was in the answer I gave the House yesterday.

💬 Grant Robertson: Does he stand by his earlier statements that the amount of new money for Vote Health in Budget 2011-12 is $420 million, meaning that there is a $156 million gap between what is in the Budget and what is needed to keep pace with population and demographic growth?

💬 Hon TONY RYALL: One of those figures mentioned by the member is in the press release of 19 May 2011, which has been widely distributed.

💬 Grant Robertson: Why, then, did the Minister not give upfront answers yesterday on exactly that question and acknowledge that there is a $156 million gap in this Budget between what is needed for meeting population growth and what he has provided?

💬 Hon TONY RYALL: I did answer all the questions yesterday, and $585 million has been made available for health initiatives this year.

💬 Grant Robertson: I raise a point of order, Mr Speaker. We went through this exercise yesterday with the Minister, and today. I make the point that we use a lot of supplementary questions for the Minister to obfuscate answers—

💬 Mr SPEAKER: No, no. I might have some sympathy with the member, but he cannot use the point of order process in that manner. With some Ministers, questions have to be very, very finely focused.

💬 Grant Robertson: Can he confirm that the Budget figures we have just been discussing do not take account of the $45 million annual cost that district health boards will face when meeting the employer contribution to KiwiSaver, thereby making the $156 million gap even larger?

💬 Hon TONY RYALL: District health boards will not face that cost until the 2012-13 Budget.

Dimethyltryptamine—Border Seizures

11. to the Minister of Customs: What reports has he received from the Customs Service on seizures of the rare drug DMT?

Excellent work by customs officers recently led to the seizure of 18 kilograms of the rare drug dimethyltryptamine (DMT). DMT is a hallucinogenic drug similar in its effects to LSD. The class A drug was detected in a package destined for Blenheim at the Auckland Mail Centre, and customs officers from Christchurch later arrested a 21-year-old Blenheim man, who has been charged with the importation of a class A controlled drug.

💬 Jonathan Young: What other drugs have the Customs Service stopped at our border, and what methods have been used to try to smuggle them over the border?

💬 Hon MAURICE WILLIAMSON: On 17 May New Zealand Customs Service officers in Wellington arrested a 34-year-old New Zealand male, after they became suspicious of two packages arriving from the United States. The packages contained 1.2 litres of the class B controlled drug gamma butyrolactone (GBL), which is known as the “date rape” drug. The drug had been smuggled in nail polish bottles, and it was only excellent work and vigilance by customs officers that detected it. A man is now facing class B controlled drug-importing charges, which carry a maximum penalty of 14 years’ imprisonment.

KiwiRail—Minister’s Statement

12. to the Minister of Transport: Does he stand by his statement that for New Zealand train builders “there will be lots of work for these guys, there’s no doubt about that”?

As I said in answer to an earlier question on the same quote, yes, and, in particular, the full quote, which I will abridge slightly for the Speaker: “the reality is this rail company has been treated like a Cinderella in this country for a long, long time, with all sorts of political things about what it should do and what it shouldn’t do, which don’t necessarily make commercial sense for the company itself to proceed with. And I believe strongly that if we’re going to turn KiwiRail around—and it’s a big turnaround project—then we actually have to let them make the commercial decisions that they need to make.”

💬 Clare Curran: Why is it a good idea to take a whole-of-economy approach to agricultural irrigation or to the making of movies such as Avatar, but not a good idea to take a whole-of-economy approach when it comes to capital purchasing and rail?

💬 Hon STEVEN JOYCE: Well, we do take a whole-of-economy approach on issues of trade and investment and decisions about what organisations should do. In fact, the previous Government did as well, as we know, because it allowed the one big train contract to occur when it was in Government, which was the Matangi train contract, to be let to Korea. That was a sensible decision. Of course, Labour no longer thinks it was a sensible decision, because it is in Opposition. Therefore I suspect it is just playing politics with this issue.

💬 Clare Curran: I raise a point of order, Mr Speaker. I asked a specific question about why it was not a good idea to take a whole-of-economy approach to capital purchasing and rail, and all he did was speak about the previous Government.

💬 Mr SPEAKER: No, if I heard him correctly, he said the Government did take a whole-of-economy approach. There was no need for him to explain why he did not, because I think in his answer he said the Government did. I am prepared to refer to the Minister, if I am wrong. No, he is indicating that what I heard was correct.

💬 Clare Curran: How does he reconcile his statement today that KiwiRail must be able to operate without political interference, with the repeated remarks of the KiwiRail Chief Executive, Jim Quinn, that he has taken a narrow commercial approach because “that is Government policy”? Who is telling the truth?

💬 Hon STEVEN JOYCE: The point I think I need to make to the member is that it is actually she who is suggesting taking a political approach, because she is suggesting that KiwiRail take a view that we do not require of any other company in this country. That is simply not appropriate. We have an organisation that is very much struggling to turn itself round. We have to give it every opportunity to succeed and to make the right commercial decisions to allow it to succeed.

💬 Clare Curran: If he is so keen to see New Zealand’s rail system run at a profit, can he confirm that our roads do?

💬 Hon STEVEN JOYCE: I can confirm two things. Firstly, I want KiwiRail to be successful, and I would have thought that the member would want KiwiRail to be successful, as well. It is crucially important for this country that we take the very big investment that was made by the previous Government, where it overpaid for KiwiRail, and make it successful. In terms of the roads, the answer is yes, so much so that they work on a pay-as-you-go system. It would be a great and wonderful thing if other aspects of the transport system also ran on a pay-as-you-go basis, which, of course, they do not.