Questions for Oral Answer

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

The general picture is that the economy has stabilised and is beginning to grow steadily. Both the June Quarterly Survey of Business Opinion and the National Bank survey showed levels of business confidence returning to where they were prior to the recession in 2008, with the exception of the construction sector, which remains weak, and some uncertainty about Christchurch. Overall, the economy is expanding in line with Budget forecasts.

💬 Todd McClay: What steps has the Government taken to ensure that this lift in confidence is sustained?

💬 Hon BILL ENGLISH: The policies that the Government has pursued are assisting with the improvement, with activity and confidence, which have both risen in the face of the earthquake, and with rising household savings, despite a fairly high dollar. In our first Budget we turned back a decade of deficits. In our second Budget we invested in infrastructure and changed the tax system. In this last Budget we have set out a track back to surplus. If the Government has its books under control it gives confidence to everyone else that they can get on with it.

💬 Todd McClay: What policies would endanger this lift in confidence?

💬 Hon BILL ENGLISH: New Zealand is currently enjoying low taxes, stable Government spending, the lowest interest rates in 45 years, and the highest savings rates in 20 years. Most of what the Opposition is proposing would undermine all of those things.

Mine Safety—Underground Mines

2. to the Minister of Labour: Does she agree that the test of practicability in the Health and Safety in Employment (Mining-Underground) Regulations 1999 is likely to result in different mines having different safety standards, in contrast to the regulations in place until 1992?

No. The 1999 underground mining regulations set both general and specific duties in relation to recognised hazards in underground mining. In meeting these duties, both specifically and more generally, mine operators are required to take all practicable steps to manage the hazards in the particular circumstances of the mine. There may be different ways for mines to meet the standard, but the standard remains the same.

💬 Kevin Hague: Does she agree that a well-resourced mining company will be able to afford more safety measures, and thereby find them practicable, than a less well-resourced mining company?

💬 Hon KATE WILKINSON: The standard remains the same, whether or not the mine is small. The employer must take all practicable steps to manage the hazards in the particular circumstances of the mine.

💬 Kevin Hague: Does she agree that mandatory rules requiring all underground mining companies to continuously monitor for the presence of flammable gases would result in safer mines than the current regulation requiring employers to take all practicable steps to test for the presence of such gases?

💬 Hon KATE WILKINSON: I do not want to speculate on hypothetical questions relating to the actual requirements, but can I say those matters are subject to a royal commission of inquiry, and we will be looking at the recommendations of that inquiry very carefully.

💬 Kevin Hague: I raise a point of order, Mr Speaker. There is nothing hypothetical about the question, and the issue of a comparison of the two sets of standards, which is what the question related to, is entirely independent of the royal commission.

💬 Mr SPEAKER: What the member asked, though, was whether the Minister agreed with something, and the Minister has a range of ways to indicate whether she agrees with something. With that kind of question, I cannot help the member a lot further.

💬 Kevin Hague: Does she share the concerns of mine safety experts that the practicability standard in our mine safety regulations allowed a 55-metre-high sheer vertical escape ladder in the Pike River coalmine, rather than what the previous standards specified, which was a safety platform every 9 metres or so?

💬 Hon KATE WILKINSON: Of course we have concerns about mine safety, which is why we have taken the matter of Pike River and the tragedy that happened there very seriously. That is why we have a royal commission of inquiry in relation to that. But in relation to the practicable steps, I believe that that is a high standard. Indeed, in the High Court Justice Ellis noted: “The obligations on an employer are uncompromising and onerous. An employer must be proactive and anticipate harm, and take all practicable steps to minimise it.”

💬 Kevin Hague: Is the Minister saying a practicability standard is equivalent to a mandatory standard?

💬 Hon KATE WILKINSON: No.

💬 Kevin Hague: What possible reason is there to wait until the royal commission reports, before making urgent moves to improve the safety of workers going underground every day right now?

💬 Hon KATE WILKINSON: Following the tragedy at Pike River, we undertook an independent audit of the other underground mines. There was no indication of any imminent danger in those underground mines. We will be looking very carefully at the no doubt comprehensive review and recommendations of the royal commission of inquiry.

💬 Kevin Hague: I seek leave to table this photograph of the 55-metre sheer vertical escape ladder at the Pike River mine.

💬 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: Is a practicability standard higher or lower than a mandatory standard?

💬 Hon KATE WILKINSON: It is not a question of whether it is a higher or a lower standard; it is a question of whether it is an appropriate standard. Practicable steps have been assessed as being a high standard, and, in fact, have been assessed as being “uncompromising and onerous” in terms of the employer’s obligations.

💬 Hon Trevor Mallard: I raise a point of order, Mr Speaker. It was a very simple and very direct question, and for a Minister to say that is not the question is, in my submission, not an appropriate way to start an answer. The next part of my point of order is that given that, the actual question was not addressed. She might say she thinks it was high—

💬 Mr SPEAKER: The member asked which was the higher standard, if I recollect correctly, as between practicability and the mandatory standard. The Minister’s answer said she believed that was irrelevant—that is what I believe the Minister implied by not saying whether one was higher than the other. She said what was relevant was—I do not want to paraphrase the Minister’s answer. To me, she is entitled to do that—not to say one is higher than the other—if she believes that a comparison is not relevant to safety. That is what I believe the Minister was indicating. If I am wrong, I invite the Minister to correct me.

💬 Hon Trevor Mallard: I raise a point of order, Mr Speaker. This is a further point of order. I think that does goes to the essence of questioning in this House. My submission to you is that it is not for a Minister to say a question is not the question that should be asked, and the Minister would rather answer another question, which is what the Minister just did.

💬 Mr SPEAKER: No, that is not what I believe the Minister did. In fairness, I believe the Minister argued, in answering the question, that the comparison with regard to which was the higher or lower of those two standards was not a relevant issue to safety, and therefore she was not prepared to say whether one was higher or lower because in her view that was not relevant to mine safety. She was not saying the member had asked the wrong question, but in answering the question—if I heard her correctly—she was saying that comparison, whether higher or lower, is not relevant to safety. Whether that is a good answer is not my job to judge. That is what I believe she answered, and I believe that is an answer to the question.

💬 Hon Trevor Mallard: I raise a point of order, Mr Speaker. I will have one further go. My supplementary question did not have a safety aspect to it at all.

💬 Mr SPEAKER: Well, I believe these are safety standards that the member is talking about, and that is why I believe—

💬 Hon Members: Higher or lower?

💬 Mr SPEAKER: Well, I do not believe, with regard to these standards, that the issue is where they are placed on a scale of altitude; it is a matter of being higher or lower with regard to safety, and—

💬 Hon Trevor Mallard: I raise a point of order, Mr Speaker. That is the very essence of the question. The Minister has lowered the standards—

💬 Mr SPEAKER: No, that is not a point of order.

💬 Hon Trevor Mallard: —and people have died.

💬 Mr SPEAKER: That is definitely not a point of order. I have listened to the questions very carefully—and these are serious questions; they are absolutely serious questions. I have listened to the Minister’s answers very carefully, and it is not my job to judge how good they are; it is my job to assess whether she has answered the question. It is within the Minister’s rights to argue with regard to a question asked in terms of standards relative to safety that one standard is not higher than another. She has argued that that is not the relevant issue, and I believe that is a fair answer to the question. People can judge its quality; that is not my job as the Speaker. I cannot rule that Ministers should answer further just because some members may not feel the answer is a good answer. I cannot rule on that.

💬 Hon Damien O’Connor: Why did her department take 10 weeks to conduct an on-site inspection of Spring Creek Mine after it was closed for production on the day of the Pike River disaster, and does this delay give an accurate indication of the inadequate level of monitoring her department was able to carry out to protect the safety of miners in underground mines?

💬 Hon KATE WILKINSON: In answer to the second part of that question, no.

💬 Hon Damien O’Connor: I raise a point of order, Mr Speaker. The Minister herself separated out the question. I would like to hear the answer to the first part of the question, as well.

💬 Mr SPEAKER: A point of order has been taken; there will not be comment. If the member wanted the first part of the question to be answered, that is all that he should have asked.

💬 Darien Fenton: Does she stand by her decision, outlined in a letter dated 12 November 2009 from her department to the Engineering, Printing and Manufacturing Union, which states “The Minister considers that the existing legislative framework under the Health and Safety in Employment Act 1992 already provides a good basis for effective employee participation.”, and that she does not agree to a regulatory change to introduce check inspectors, nor for there to be an improved code of practice for employee participation specifically in the mining sector?

💬 Hon KATE WILKINSON: Yes, I do stand by those statements, but I am also looking forward to the recommendations of the royal commission of inquiry, which will be able to show whether our regulatory framework is appropriate, and where, if anywhere, it can be improved.

💬 Darien Fenton: I seek leave to table the letter I just quoted from the Department of Labour to the heath and safety coordinator of the Engineering, Printing and Manufacturing Union, dated 12 November 2009.

💬 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 Damien O’Connor: I seek leave to table in the House an audit report on Spring Creek Mine that shows this audit was conducted 10 weeks after the disaster at Pike River.

💬 Mr SPEAKER: Could we just check who compiled the report?

💬 Hon Damien O’Connor: This is a Department of Labour report.

💬 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.

Pay Equity—Gender Gap

3. to the Prime Minister: In light of his comment that “New Zealand is to be congratulated because, at least in terms of the gender pay gap, ours is the third lowest in the OECD”, does that mean he is satisfied with the 10.6 percent gap between men’s and women’s pay in our country?

on behalf of the Prime Minister: No. Of course it means there is more change to occur, but New Zealand is in a better position on an international comparison than most other OECD countries.

💬 Hon Annette King: Is he aware that a claim against an employer for pay discrimination on the grounds of gender cannot be made unless the claimant has information to prove that she has been discriminated against; if so, how does he suggest this information be gathered?

I am aware of that debate, and I understand there is a proposition to introduce a member’s bill into the House to resolve it, which, of course, will be a waste of time, because the Labour Party is filibustering all members’ days and that bill will never be debated.

💬 Hon Annette King: I raise a point of order, Mr Speaker. I think I asked a pretty straightforward question. To flick off at the Labour Party about some other debate hardly satisfies as an answer.

💬 Mr SPEAKER: What the Minister said in his answer was that he was aware of this issue and the debate on this issue. He did not offer any answer himself. The member had asked whether he could explain how such a person could obtain the information, and the Minister was unable to explain how the person would get the information, but he did say that a member’s bill was to be introduced to address that. That was an answer to the question.

💬 Hon Annette King: Does he believe that privacy issues override the rights of women to receive equal pay for equal work; if so, why?

We in Government are always, as the member will know, balancing personal privacy issues with the requirements of achieving the public good. In the case of pay equity, it is simply not legal to pay people different amounts based on their gender. There is the opportunity for individuals or the courts to enforce what has been the law of Parliament for several decades.

💬 Hon Annette King: If privacy issues can be mitigated, as suggested by the Human Rights Commission, will National support legislation that would require employers to report on gender pay rates in their workplace, and release aggregated information on gender to employees on request?

If someone proposed legislation of that sort, then we would consider it. But it looks as though it would be a very low priority for the Labour Party, because it is spending most of the year on the Royal Society of New Zealand Amendment Bill, which is taking up all of the members’ time available to Parliament.

💬 Metiria Turei: I seek the leave of the House to have the pay equity member’s bill in the name of Catherine Delahunty set down for first reading on the next sitting day.

💬 Mr SPEAKER: Leave is sought for that course of action. Is there any objection? There is objection.

💬 Hon Annette King: Does he agree with Elizabeth Bang from the National Council of Women, who said that people should be able to ask whether there is a disparity in pay between people who work in similar positions, and that there should be transparency; if so, how does he intend that his Government will make it happen?

The Government is yet to see the detail and be persuaded of the merits of the case. But I might point out that significant progress is being made. The measure of the gender pay gap shows that it has dropped from 13 percent in 2008 to 10.6 percent in 2010. In fact, it has reduced more quickly over the last 3 years than at any other time since it has been measured.

💬 Hon Annette King: Given that he said earlier in the week that he does not know whether women are being paid differently because of their gender, will he listen to the growing chorus of leading New Zealand women, from the former Prime Minister Dame Jenny Shipley to Janet Tuck, Cathy Quinn, Mai Chen, and Dr Judy McGregor, to name just a few, who are telling the Government that there is a gap and it ought to do something about it?

Of course the Government will listen to anyone who articulates an interesting and challenging point of view. The fact is there are many causes for the gap in pay, and it has been improving at a faster rate in the last 3 years than at any time in the last 15 years.

💬 Carol Beaumont: Does the fact that only a handful of equal pay cases have been taken in the last 30 years under either the Equal Pay Act or the Human Rights Act show that there is no issue with women being paid differently because of gender, or that the existing legislation is not adequate to deal with the problem?

It is also possible that employers and employees follow the law, and the law says that someone cannot be paid differently based on their gender.

💬 Carol Beaumont: When he is looking closely at the gender pay gap of 27.5 percent in the Department of the Prime Minister and Cabinet, will he also look closely at the gender pay gaps of other Government departments, which, based on the report of Dr Judy McGregor, include a gap of 29 percent in Treasury, 30.65 percent in education, and 26.09 percent in the Crown Law Office, or will he put that down to “different people are doing different jobs, it is not an issue of gender; it is an issue of the jobs they perform.”?

I certainly agree with the second statement. If there is evidence of pay discrimination in Government departments, then the Government as an employer has to comply with the law. We would expect to take action to deal with any pay discrimination.

Unemployment Beneficiaries—Number

KATRINA SHANKS (National): On behalf of Louise Upston, to the Minister of Social Development and Employment, what reports has she received—

💬 Mr SPEAKER: I apologise to the honourable member. Would both the Hon Annette King and the Hon Bill English please cease the interjections—and the Hon Chris Finlayson for good measure, too—because I cannot hear Katrina Shanks.

4. KATRINA SHANKS (National) on behalf of to the Minister for Social Development and Employment: What reports has she received on the latest benefit numbers?

The June benefit numbers show nearly 800 fewer people on the unemployment benefit since May, and 94 percent of that reduction is of young people—that is about 754 of that nearly 800. This is the fifth consecutive month that benefit numbers have fallen, and the first time in 4 years in the month of June that numbers have fallen, as well, which is of course a credit to the sound economic direction set by our Prime Minister and this National-led Government.

💬 Katrina Shanks: What impact have this Government’s policies had on benefit numbers?

💬 Hon PAULA BENNETT: This Government has reduced the numbers on the unemployment benefit by more than 9,000 since September, with a range of measures designed to give businesses coming out of the recession the confidence to take on new staff. These measures include lowering company and personal tax rates in October, and in April this year; extending the 90-day trial period to all companies, which has made a significant difference; providing 12,000 Job Ops places for young people; and implementing the first phase of the welfare reforms in the Future Focus package last year.

💬 Te Ururoa Flavell: Kua heke iho te tatauranga mō ngā tāngata Māori e noho kore mahi ana?

[Has the number of unemployed Māori reduced?]

💬 Hon PAULA BENNETT: The number of Māori receiving unemployment benefit - related benefits decreased by 399, or 2 percent, during June. [Interruption] Do you not want to hear the answer about Māori and unemployment—

💬 Mr SPEAKER: I apologise to the Minister, but a member of the Māori Party asked a supplementary question; he has the right to hear the answer. I ask the Labour Party on this occasion to please cut the noise, because it is so discourteous. [Interruption] On this occasion the Hon Annette King, again, is being particularly naughty, and the honourable Minister, the Hon Paula Bennett, will cease this noise. When I am on my feet this nonsense will stop or someone will be taking an early shower.

💬 Hon PAULA BENNETT: The number of Māori receiving unemployment benefit - related benefits decreased by 399, or 2 percent, during June. This decrease was larger than the overall decrease of 1.4 percent in unemployment benefit - related benefits. The largest decreases were in the Auckland region, where the number was down by 374, and the Northland region, where it was down by 112. The number of Māori on the unemployment benefit in June 2011 was 19,400, and in June 2010 it was up at 21,100, so we are making a bit of a difference.

Earthquakes, Canterbury—Allocation of Land Value in Crown Purchase Offer

5. to the Minister for Canterbury Earthquake Recovery: Does he consider the allocation of the value of the land within the rating valuation process to be robust, when it has produced such variable outcomes, leaving many in the red zone with insufficient funds to buy a section to take advantage of the replacement option in their insurance policy?

on behalf of the Minister for Canterbury Earthquake Recovery: The Minister can only accept the valuation that was accepted by the Government of the day—that member was the Minister for Building and Construction at the time, and his colleague David Parker was the Minister for Land Information—back in August 2007. The 23 June offer by the Government to purchase properties in the most damaged areas at the 2007 rating valuation is a fair and balanced one.

💬 Hon Clayton Cosgrove: I raise a point of order, Mr Speaker. I think the Minister may be confused. My question was about land value, not property value per se—land value. There is a distinction.

💬 Mr SPEAKER: Well, I believe that what the Minister said in his answer was that he did believe that it was robust because the Ministers of the day had accepted that it was robust. That was what I thought the Minister answered. If I am wrong on that, the Minister had better indicate I am wrong, but he is not doing that.

💬 Hon Lianne Dalziel: I raise a point of order, Mr Speaker. The question talks about the value of the land within the rating valuation process—

💬 Mr SPEAKER: What I understood the Minister to indicate was, given this question, I presume the Ministers of the day accepted that the land within the rating valuation process was a robust arrangement, and the Minister is saying that he is not second-guessing the Ministers of the day—that he accepts their judgment. That would seem to be what the Minister was saying.

💬 Hon Trevor Mallard: I raise a point of order, Mr Speaker. That might well have been what the Minister meant to say. I know that it is an unusual process, but can I seek the indulgence of the House to ask the Minister to repeat his answer, because I do not think that was what he did actually say.

💬 Mr SPEAKER: I listened very carefully, and I accept that the Minister could perhaps have been more precise in his answer. If the questioner indicates to me that the way land values are treated within the overall rating process has changed since 2007—that that process has changed—I will allow him to ask his question again. If it has not changed, the answer is relevant, because the Minister in answering said the Ministers of the day had accepted it was robust and he is not second-guessing that.

💬 Hon Trevor Mallard: I raise a point of order, Mr Speaker. I think he said the property valuation is robust, but that is not the land. I think that is what he said.

💬 Mr SPEAKER: We are not going to debate it by way of point of order. We have done that for long enough. There are further supplementary questions. I believe that the Minister answered it. It may not have been exactly the answer the member wanted, but given the question asked, it was an answer.

💬 Hon Clayton Cosgrove: Will he be putting in place a formal appeal process to address any issues of inconsistency in the rating values of land, recognising that the rating evaluation mechanism was never established for the purpose of paying out on land damaged by a natural disaster—referring here to land?

I understand that a whole lot of the technical, specific details of the package are still to be worked through. I understand that the Minister has had brought to his attention some issues about land valuations with regard to cross-leased and unit title sections. And I understand that all of those will be addressed in great detail as the package is brought to the market.

💬 Hon Clayton Cosgrove: I raise a point of order, Mr Speaker. It was a relatively straightforward question that asked “Will he be putting in place a process?”.

💬 Mr SPEAKER: And it was a good question, I say to the honourable member, if I may be so humble as to do so. But the Minister indicated in his answer that the details of the package to which appeals might relate are not yet finalised. He cannot indicate to the member whether there will be an appeal process, because the package that relates to all of this is not yet finalised. That is what I believe the Minister said. That is an answer to the question. He cannot indicate whether there will be an appeal process, if the package that might contain an appeal process has not yet been developed, not yet been finalised. I believe that the Minister has given a genuine answer to that question.

💬 Hon Clayton Cosgrove: Does the Minister now accept that his public commitment—which he repeated as late as 15 June, and was detailed in yesterday’s questions to him—that the equity that earthquake victims have in their properties will be preserved has about as much value now as many of those damaged properties in Christchurch?

No.

💬 Hon Lianne Dalziel: Does the Minister accept that the rating valuation process divides the total capital into two components—land and improvements—and does he now accept, knowing that so many in the red zone have insufficient funds to buy a section, that the land component is not fair and balanced?

With regard to the first part, yes, I do. All I can say is that homeowners have their rating valuation from 2007. An analysis from the Institute of Valuers shows that sales prior to 4 September confirm that we have come up with a fair number. For example, where the member lives, I understand—in Bexley—just prior to the 4 September earthquake properties were selling for around 93.7 percent of their rating value.

💬 Hon Lianne Dalziel: Can he confirm that in certain situations the Earthquake Commission’s cash settlement for land within the red zone will be more than the land component of the 2007 rateable value; if so, what steps is he taking to notify homeowners of this option, before the Government offer is made on a formal basis?

No, I cannot confirm that.

💬 Hon Lianne Dalziel: Supplementary question, Mr Speaker.

💬 Mr SPEAKER: Before I call the member further, I invite the member to repeat the question she just asked. It was a very reasonable question and I want to make sure I heard it correctly myself. The member may repeat her last question.

💬 Hon Lianne Dalziel: Can he confirm that in certain situations the Earthquake Commission’s cash settlement for land within the red zone will be more than the land component of the 2007 rateable value; if so, what steps is he taking to notify homeowners of this option, before the Government offer is made on a formal basis?

My answer was that, no, I cannot confirm that. On a case by case basis that may be true, but I cannot confirm that.

💬 Hon Lianne Dalziel: Can he advise whether the Earthquake Commission’s cash settlement for land includes the cost of repairing individual sections, when the Government has ruled land repair in the red zone to be uneconomic; if so, will he review that decision in light of his stated commitment to fairness and balance?

I am sorry but I cannot confirm some of the details the member keeps asking about. If they were put down in a primary question or a question for written answer, we would be very happy to give specific details. All I will repeat is that the Government put a lot of work into this. The package is between $485 million and $635 million. We believe it to be a fair, reasonable, and balanced offer.

💬 Hon Ruth Dyson: Does it meet his definition of fair and balanced that a couple in their late 80s living in the red zone who do not meet mortgage criteria, and could not sustain a mortgage if they had one, have a significant shortfall between the rateable value on their property and the purchase price of anything similar; if it does not meet the definition, will he take some action to deliver fairness for them?

As I have said on a number of occasions, the Government put long thought into the process of coming up with a number that could be justified. The 2007 rating value seemed to be the right number to use. As I said, in many cases property prices had dropped since that time. We think it is a fair and balanced package.

💬 Hon Ruth Dyson: Does it meet that same definition of fairness that a couple in a brand new home that could be repaired—but they are living in the red zone, so they have to move out—have been told by their insurance company that they will be paid only the cost of the repair; if that is not fair, will he act to deliver fairness for them?

I will not be foolish enough to get involved in making a comment on any specific case, other than to say I think the package is fair and balanced. It is also voluntary; people can choose to take it, or not.

💬 Mr SPEAKER: I want to hear Brendon Burns’ question. These are serious questions. I must hear them.

💬 Brendon Burns: Does the Minister have any estimate, or even an indication, of what percentage of owners of properties in the red zone are likely to lose equity on their land, or on their land and home, under the Government’s two buy-out options?

No, I do not have that estimate, but what I can say is that a very large number of emails and messages have been coming in from people saying to the Minister: “Thank you for the package you’ve put up. We look forward to being able to sign up and take advantage of it.”

💬 Brendon Burns: Given the Minister’s assurances about preserving equity, made as recently as 2 days after the 13 June shakes, what does he say to my Avonside constituents, many of whom believe they will lose equity of between $50,000 and $90,000 under either of the Government’s buy-out options, including David Hayward of Avonside Drive, who says $90,000 is the minimum amount he stands to lose?

I know that this is sounding like a cracked record, but, look, the Government believes that the package we have put together is a fair and balanced package. I will not spend time in this House debating specific cases. There will always be circumstances unique to each case.

💬 Hon Lianne Dalziel: I seek leave to table an extract from an email that shows three separate rateable values for the land-only components of three 17-metre frontages on the river Avon in the suburb of Avondale—

💬 Mr SPEAKER: Could the member indicate the source? Who prepared this document?

💬 Hon Lianne Dalziel: It is an extract from an email sent to me by a resident of Avondale.

💬 Mr SPEAKER: It is an email from a resident of Avondale. Leave is sought to table that document. Is there any objection? There is objection.

I call question No. 6, Dr Cam Calder. [Interruption] On this occasion it is the Hon Trevor Mallard I ask to show some courtesy. I have called Dr Cam Calder. Once a question is dealt with, I expect the House to show some courtesy to the next questioner.

Green Growth—Business Opportunities

6. to the Minister for the Environment: What work is his Ministry doing to help New Zealand take up the opportunity from green growth following the OECD May 2011 report on the high expected global demand for such products and services?

The Government established the Advisory Group on Green Growth, led by Business New Zealand Chief Executive, Phil O’Reilly, earlier this year. This week it issued a discussion paper highlighting some of the opportunities. Our objective is to get our regulatory, research, and economic policies right so New Zealand businesses can maximise those global opportunities.

💬 Dr Cam Calder: What examples does the Minister have of green growth businesses that the Government is supporting, and which are providing jobs and improving the environment?

💬 Hon Dr NICK SMITH: I could give many examples, but I want to draw the attention of the House to EnviroComp, a Canterbury-based family business that was started in 2009 composting disposable nappies, which is a world first. It has announced plans to expand to Wellington. It is now exporting that technology to both the UK and Australia. Another Kiwi business, Eco Stock Supplies, was started in South Auckland and it recycles food processor waste into livestock feed. It now employs over 30 people and diverts 25,000 tonnes of food waste from landfill into useful product. I commend both Nicky Wagner and Cam Calder for the way they have championed those sorts of businesses.

Foreign Affairs and Trade, Ministry—2010-11 Human Resources Contracts

7. to the Minister of Foreign Affairs: How many human resources contracts, if any, were let by the Ministry of Foreign Affairs and Trade without tenders being invited in 2010/2011, and what criteria were used to assess non-tendered contractors?

on behalf of the Minister of Foreign Affairs: I first advise that the chief executive of the ministry is responsible for the internal procurement policies and practices of the Ministry of Foreign Affairs and Trade. The Minister has further advised that in terms of contracts entered for human resources services, including services provided under the ministry’s change agenda, the Ministry of Foreign Affairs and Trade entered into 21 contracts of over $10,000 in value that were not tendered. The criteria used were the specifications for the role, with applicants being assessed through an interview and referee-check process. I am advised that the ministry has in place an extensive procurement policy and guidance for staff, and is governed by a procurement policy put in place by the previous Government. I also add that the Minister of Foreign Affairs has made it clear to the ministry that the current level of expenditure on human resources contracts is out of line with the Government’s expectations.

💬 Hon Maryan Street: Given that something in the order of $1.2 million was spent on untendered human resources contracts alone in 2010-11, is this what the Minister meant when he said to the Foreign Affairs, Defence and Trade Committee that “The idea that the only people that can work for the New Zealand foreign ministry in a valuable way are full-time staff members who have been there all their lives is, frankly, outdated nonsense.”?

I am not sure that I can vouch that that is exactly the reason why, but I point out again that the ministry is responsible for those decisions and it is governed by a procurement policy and guidance for staff in relation to making those decisions that were, of course, put in place by the previous Government.

💬 Hon Maryan Street: What criteria out of those in the Minister’s answer to the substantive question did Momentum Consulting Group satisfy to earn $129,000 without tender?

I do not have information on that specific contract. If the member would like to put that to the Minister in writing, I am sure he would be happy to respond.

💬 Hon Maryan Street: Is it “outdated nonsense” for Government ministries to keep to budgets in this time of fiscal constraint, and does that explain the Ministry of Foreign Affairs and Trade’s $2.6 million blowout on contracts and consultants in 2010-11?

Quite obviously, the answer to the first part of the question is no.

💬 Hon Maryan Street: I seek leave to table annex 5, table 2 of the answers to the Ministry of Foreign Affairs and Trade supplementary estimates questions on 2010-11, on expenditure on consultants and contractors.

💬 Mr SPEAKER: This is information to the select committee. I just want to check. They are already available to the public. I seek leave of the House for that document to be tabled. Is there any objection? There is objection.

Public Transport, Wellington—Commuter Rail Network

8. to the Minister of Transport: What is the Government doing to improve Wellington’s commuter rail network?

A huge amount. This week the Government has entered into an agreement with the Greater Wellington Regional Council and KiwiRail that will provide a permanent improvement to the commuter rail network in Wellington. As part of that plan the Government has committed to funding a further $88 million of renewal of the Wellington rail network infrastructure. Earlier in the week I was present at the signing of an agreement that included KiwiRail transferring ownership of the Ganz Mavag trains to Greater Wellington, and the council committing to upgrade the Ganz Mavag trains at a cost of around $80 million. As a result of this asset transfer, the regional council is now the owner of much of the region’s above-track rail infrastructure, including the rolling stock and most of the stations. This will give them more independence and flexibility in how to configure services going forward.

💬 Paul Quinn: How will these measures affect users of Wellington’s commuter train services?

💬 Hon STEVEN JOYCE: This package, coupled with previous investments from the Government and the regional council, including the new Matangi trains, will at last deliver Wellington a modern, reliable commuter rail service into the future. Commuters have put up with the shortcomings of the Wellington rail network for a very long period of time—too long. Although new trains, double tracking to Waikanae, and other initiatives have been a great start, more work has needed to be done to provide a consistent modern service. These improvements will give commuters a real choice about travelling to and from the central business district, leading to less congestion on the roads and greater mobility for those unable to drive.

Welfare System—Benefits of Work

9. to the Prime Minister: Does he stand by his statement “there is no question in my mind - someone would be better off in paid employment than on welfare. If they were not, that is a real indictment on the welfare system”?

on behalf of the Prime Minister: Yes.

💬 Metiria Turei: Is the Minister aware that a sole parent working part-time who earns an extra $100 a week currently keeps $80 in the hand, but under the recommendations of the Welfare Working Group would keep only $40, and is his Government considering adopting this recommendation from the Welfare Working Group?

The member has been speculating for a while on recommendations that are from the Welfare Working Group and not Government policy. The Government is working through all the recommendations of the Welfare Working Group, and, as it has signalled already, some of them it is likely to pick up and others it will not pick up. But we will certainly not be treating them individually. We will be looking at the recommendations in the context of a package of change that will improve the welfare system and reduce dependency.

💬 Metiria Turei: Does the Minister agree that the benefit abatement rates should support and encourage sole parents to move to appropriate part-time work; if so, why would his Government consider adopting a recommendation—[Interruption] Excuse me! I am asking the question. I raise a point of order, Mr Speaker. This is a question that has been set down. It is reasonable that I ask my question of the Minister and have him at least listen to the question so that he can answer it—which is what this process is for—rather than having a private conversation with another person—

💬 Mr SPEAKER: I am sure the Minister is listening and I am sure that the Minister will answer the member’s question. I invite her to start her question again.

💬 Metiria Turei: Does the Minister agree that benefit abatement rates should support sole parents to move to appropriate part-time work; if so, why would his Government consider adopting recommendations from the Welfare Working Group that would punish sole parents for making that transition to work?

The Government does agree that the abatement system is there to help sole parents transition to work. In recognition of their circumstances we raised the thresholds—that is, the amount of income they are allowed to earn while staying on a benefit. But there has always been a trade-off in a benefit system between allowing people to earn more while they are on a benefit but not making it possible for them to earn substantial incomes or better incomes than people in full-time work. So, the system also has to try to encourage them to make the leap to full-time work. There is nothing new about these trade-offs, and people have different opinions about it.

💬 Metiria Turei: Does the Minister agree that an abatement regime that provides for an effective marginal tax rate for beneficiaries of up to 92 percent is a massive disincentive for those beneficiaries to move into part-time work, and will he commit to reviewing the Welfare Working Group recommendations in light of a system that does not penalise but rather supports and encourages beneficiaries to move into appropriate part-time work?

Yes. Ninety percent marginal tax rates are of course undesirable; it is just that they happen to be better than the worse alternatives. One way to drop those marginal tax rates is to allow people who are getting a benefit to earn very substantial income in work, and that could easily put them in a better situation than being in full-time work. So that is the trade-off. No one wants 90 percent marginal tax rates, but it is extremely difficult to avoid them when one is making large cash payments to people who are, most of the time, out of work.

💬 Metiria Turei: I seek leave to table a letter from Professor Innes Asher to the members of the ministerial group on welfare reform, showing how a beneficiary moving into part-time work would receive only $40 of every $100 earned under the Welfare Working Group recommendations.

💬 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.

China Investment Corporation—Meeting with Minister

10. to the Minister of Finance: When he said that “I did visit the Chinese Investment Corporation … They are very pleased with New Zealand’s economic policy”, was one of the policies he discussed with this foreign sovereign wealth fund his plan for privatising state assets?

No.

💬 Hon Trevor Mallard: What is the official advice that he has received on whether foreign investment would be essential to his plans for privatising assets?

💬 Hon BILL ENGLISH: We have not received any advice that it is essential. The Government has made its intentions clear—that is, we will maintain 51 percent ownership, and we will provide a very good opportunity for New Zealanders to invest in New Zealand. Kiwi mums and dads will be at the front of the queue.

💬 Hon Trevor Mallard: When he went on to say “Contact Energy … still has the largest register of shareholders on the New Zealand stock exchange—shares still largely held by Kiwi mums and dads.”, was he aware that 97.5 percent of Kiwis have been stripped of their ownership of Contact Energy, two-thirds of the company is owned overseas, and over $1 billion of dividends from Contact Energy have headed offshore so far?

💬 Hon BILL ENGLISH: Well, the Opposition uses the example of Contact Energy, which was sold in a different way. It was sold to overseas owners in a majority. Edison Mission Energy bought 40 percent of Contact Energy shares. The Government’s plans are to retain 51 percent ownership of State-owned energy companies. In the end we would rather pay dividends to Kiwis than interest to overseas lenders. Labour wants us to pay interest to overseas lenders; we want to pay dividends to Kiwis.

Television—Switch-over to Digital

11. to the Minister of Broadcasting: What recent announcements has the Government made on progress towards digital switchover?

Recently the Government confirmed the dates and timing for completing the switch to digital television across the country, as well as the extension of digital terrestrial transmission work from 75 percent to 87 percent of the population, and an $850,000 assistance package for regional broadcasters.

💬 Jami-Lee Ross: What are the benefits of the switch to digital television for New Zealand?

💬 Hon Dr JONATHAN COLEMAN: In addition to enhanced reception and better picture quality—

💬 Hon Trevor Mallard: I raise a point of order, Mr Speaker. Just to be a little bit helpful to members on this side, I am not sure whether the member’s microphone is pointing in the right direction, but it does not appear to be—

💬 Mr SPEAKER: I just ask the member to speak a little closer to the microphone. If the Hon Jonathan Coleman could start his answer again.

💬 Hon Dr JONATHAN COLEMAN: I do not think it is me, Mr Speaker, quite frankly. In addition to enhanced—[Interruption] In addition—

💬 Chris Hipkins: That’s what he said about Mt Albert, too!

💬 Hon Dr JONATHAN COLEMAN: That is it. You have had my answer.

💬 Mr SPEAKER: No, no. If the Minister could please answer the question, and start again.

💬 Hon Dr JONATHAN COLEMAN: In addition to enhanced reception and better picture quality, the spectrum will be ideal for fourth-generation mobile technologies, which provide access to faster mobile broadband services with improved coverage. The total economic benefits are estimated to be between $1.1 billion and $2.4 billion over 20 years.

💬 Rahui Katene: What will be the financial impact on families of making the digital switchover, and what is the Government doing to mitigate this impact?

💬 Hon Dr JONATHAN COLEMAN: The costs of going digital vary, depending on location, and the equipment people need, but 77 percent of New Zealand households already have digital television. Any television can be converted to digital with a set top box, which can be bought at The Warehouse for as little as $79. The Government is yet to take any decisions on the possible form of any assistance package.

Health System—Scope and Range of Services

12. to the Minister of Health: Does he stand by his statement to the Cabinet Expenditure Control Committee that “we may need to take some tough choices regarding the scope and range of services the public health system can provide to New Zealanders”?

Within the context, yes.

💬 Grant Robertson: Is one of the changes to the scope and range of services that he meant the cutting of beds, of the emergency department, and of palliative care services at Hāwera Hospital, which have been described by the chairman of the Ngāti Ruanui rūnunga as “a drastic and unacceptable reduction in health services”?

💬 Hon TONY RYALL: There is a consultation currently under way on services at Hāwera. The proposals do include the maintenance of maternity beds, palliative care beds, and short-stay emergency department beds. They are all in the plan, along with after-hours general practitioner services. The Government and the district health board believe that the people of South Taranaki deserve better facilities and services, and we are consulting on those.

💬 Grant Robertson: How can he interpret the people of South Taranaki as getting better services when he is cutting $1.1 million worth of services to Hāwera Hospital?

💬 Hon TONY RYALL: First of all, $1 million is about 0.3 percent of the district health board’s budget. The important issue here is that—[Interruption] One of the biggest issues faced by the people of South Taranaki, which we have inherited from the previous Government, is a difficulty with regard to general practice access. That is part of this plan: to improve general practice access, and also to improve access to other specialist services. The consultation on the plan is under way.

💬 Chester Borrows: What advice has the Minister received about proposed changes to health services in South Taranaki as to whether they are set in concrete, or is this a genuine public consultation?

💬 Hon TONY RYALL: I have seen a number of reports. One report said the emergency services at Hāwera Hospital were privatised to a private company under the previous Labour Government—[Interruption] They were privatised under the previous Labour Government. And it fell over. I have also seen another report about a comprehensive consultation process under way with the people of South Taranaki about how best to meet future health needs. It is important to remember that no decisions have been made by the district health board, and that the people of South Taranaki deserve something more future-orientated than what they have at the moment.

💬 Grant Robertson: Given that 8,000 people have now signed a petition to retain the services at Hāwera Hospital, does he stand by the statement he “repeatedly” made to local MP Chester Borrows, as reported in the Taranaki Daily News last month, that “health services in South Taranaki will not change unless the people want them to change.”?

💬 Hon TONY RYALL: That is why there is a public consultation under way. It is interesting to note that I do not think there was any public consultation when the previous Government privatised the emergency department at Hāwera Hospital—privatised without consultation.

💬 Grant Robertson: I raise a point of order, Mr Speaker. I know that I began the question with the word “Given”, but I did then ask “does he stand by the statement”, and the Minister did not make any attempt to answer that question.

💬 Mr SPEAKER: The member is clever enough to know that once he starts a question with “Given”, he leaves a lot of scope for a Minister’s answer.

💬 Hon Heather Roy: Can he advise whether one of the reasons that tough choices are required is the fact that the health sector suffered a 15 percent drop in doctors’ productivity and an 11 percent drop in nurses’ productivity under the previous Labour Government?

💬 Hon TONY RYALL: I am aware of the numbers the member refers to. This National Government is doing 20,000 more elective procedures a year. There are 1,000 extra nurses and 500 extra doctors. We have put in place programmes to make wards more productive—this is being led particularly by nurses—and we have seen a remarkable improvement in waiting times in emergency departments, cancer treatment times, and immunisation rates. I think productivity is on the way up because the clinical staff of New Zealand know they have a coalition Government that is prepared to back them and their services.

💬 Hon Heather Roy: What is his best estimate of the number of operations and procedures that were lost as a result of the massive fall in productivity under Labour, and are there any estimates of the pain and suffering this caused to New Zealanders?

💬 Hon Trevor Mallard: I raise a point of order, Mr Speaker. I ask you to rule on whether the assertion in that is necessary for the question; if not, I think you are obliged to rule it out.

💬 Mr SPEAKER: My goodness, does the member really want me to rule out assertions in questions on a regular basis?

💬 Hon Heather Roy: Point of order—

💬 Mr SPEAKER: Before I hear the honourable member, I say the question asked the Minister about what advice he had received on the reasons for the reduction in productivity. In answering it he will need to be careful, because he is not responsible for the policies of the previous Government. He can report on any advice he has received, but he must not give any personal views about the previous Government. That is not his responsibility.

💬 Hon TONY RYALL: It is difficult to obtain an estimate of the number of operations and procedures that were lost as a result of the massive fall in productivity under the previous Labour Government, but I suspect the appropriate number is 30,000, which is the number of patients culled off waiting lists under the previous Government, even though they had been promised they would get treatment.

💬 Hon Heather Roy: I seek leave to table a report entitled Productivity Performance of New Zealand Public Hospitals 1998/99 to 2005/06 by Mani Maniparathy.

💬 Mr SPEAKER: The report was prepared by whom?

💬 Hon Heather Roy: The author was Mani Maniparathy.

💬 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.

Question No. 10 to Minister

I seek leave to table a page of a document from the Crown Ownership Monitoring Unit that indicates that the advice to the Government was that significant participation by foreign investors will be essential to achieve the Government’s overall objectives in its privatisation programme.

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