Telecommunications (Development Levy) Amendment Bill

I am very happy to take a call on clause 2, which is the commencement clause of the bill, the Telecommunications (Development Levy) Amendment Bill. It is a nice, simple, straightforward clause, which reads: “The Act comes into force on the day”—on the date after—“on the day after the date on which it receives the Royal assent.” That seems relatively straightforward. What does that actually mean?

💬 Hon Ruth Dyson: Can you say that again?

I will read it out again because I botched it up completely the first time. “The Act comes into force on the day after the date on which it receives the Royal assent.” That might seem relatively straightforward. Typically, the Royal assent would be given within a few days of the bill being passed through all of its stages by Parliament, with the Governor-General signing it, effectively, on behalf of the Sovereign, the Queen of New Zealand, who is, of course, Queen Elizabeth. However, there is no guarantee that the Royal assent will, in fact, be given. All New Zealanders work under the assumption that if a law is passed by Parliament, it will automatically become the law of New Zealand. That is not correct. In fact, we have the royal prerogative, which does allow the Sovereign of the country not to provide Royal assent. That has not happened in New Zealand but it has happened in other jurisdictions that have a similar procedure. If I look at the Parliament of Belgium, for example—

💬 Hon Member: Let’s!

Oh, we will look at the Parliament of Belgium, where the issue of the Royal assent came up when a law was passed by Parliament—and I think, from memory, it was around gay marriage—that the King of Belgium objected to and, therefore, refused to provide the Royal assent. Therefore, the will of the people, through the democratically elected Parliament, was thwarted—or perhaps it was not. What the Parliament of Belgium did—and this is quite a novel approach—was, effectively, to remove the king from office for a day. The law was signed—

The CHAIRPERSON (Hon Chester Borrows): I would not want the member to feel that I was being pedantic in any way, but it has been drawn to my attention that speculating as to what the Sovereign may do at any one time is not only a long way away from the ambit of this particular clause but also may draw disrespect towards the Sovereign. The member may wish to check Standing Order 118 in relation to that. I would ask him to stick fairly close to, as he has conceded, the very narrow nature of clause 2.

Absolutely, and I mean no disrespect to the Sovereign whatsoever, and I wish to make that abundantly clear. However, the Royal assent is granted by the Sovereign of New Zealand, who is Queen Elizabeth II, or by the Governor-General. The point that I am making is merely that there is no guarantee that the Royal assent would be given by the Sovereign, and I am not speculating in any way as to whether the Sovereign may or may not give the Royal assent. I am simply pointing out that there is precedent of the Royal assent not being given in other jurisdictions that follow the same legal process as us. In the case of Belgium, what that resulted in was the Parliament, effectively, taking the sovereignty for itself for a short period of time, which allowed the Prime Minister to sign the law, and then, of course, the Sovereign was reinstated. That was the precedent in Belgium.

We are very fortunate that in New Zealand the Royal assent, as far as I know, has never been refused under the royal prerogative. And that, of course, is a very good thing. The principle that we have in New Zealand is that the Parliament, the will of the people through the majority in the Parliament—even when the minority is right and the majority is wrong—will be given the Royal assent, and that will become the law. So this bill will, effectively, come into force at some point within the next few days, probably. I think early next week would be the next opportunity for the Governor-General to sign the law, for it to come into force. Of course, we are debating this bill on 21 May, despite the fact that the rest of the country has moved on and it is now 22 May. The Hansard records of the House, if this bill is passed—and by the looks of the votes, it is going to be passed by a reasonably comfortable margin—will show that this was passed on 21 May. One would assume that the Royal assent might be given on 22 May.

That will not be the case, because, in fact, by the time the bill makes its way to the Governor-General for the Royal assent, it will be at least 23 May. I would think that it is not going to go to the Governor-General today—“normal people time”—which is 22 May. It is 21 May according to the House. It will be 23 May tomorrow by the time the bill is prepared and ready, but that, of course, is a weekend. So Monday, 25 May would probably be the first opportunity for this law to actually come into force. This is quite correct. This is when the Royal assent will take place. The earliest opportunity for this bill to come into force would be Monday, when you work through the logical sequence of the dates that we are talking about. The reality would be that if the Governor-General were unavailable to sign the legislation for some reason, it may not come into effect on Monday, and it may be given the Royal assent further down the track. There are, of course, other provisions that mean that if the Governor-General is not available on Monday, the legislation could be signed by someone else.

I am ecstatic to rise to speak on clause 2, particularly the part of clause 2 that my learned colleague Chris Hipkins from the Labour Party has started us down. I think he has raised a very, very good point about the fact that nobody can assume that any legislation will be passed. Obviously, one of the reasons for the beginning date of this legislation is that one of the things the Government wants to do, I am sure, and one of the things that parties supporting this bill want to do is make sure that those telecommunications companies have the widest possible opportunity to amend their budgets, to make sure that the levy that is in place—the levy they know has been in place since 2011—is going to continue until 2020. We want to give them a strong lead-in on that, because nobody wants to actually negatively affect those telecommunications companies in the way they do their business.

Also, the Minister made the point that as soon as we know where the money is going to come from, there are other conversations that can take place around the provision and who is going to do this, that, and the other. But, actually, I want to go back to the point that Mr Hipkins raised, and that is around Royal assent. I think it is a very, very valid point. For me, personally, it is one of the reasons why New Zealand should never become a republic. I think it is one of the strongest reasons why New Zealand should never become a republic.

Let us imagine that this piece of legislation, with the start date that is required, is not in the best interests of the country. Let us just imagine that for a moment. With a start date such as this, where it requires Royal assent to begin, then the Governor-General can actually refuse to sign it. Until the Governor-General signs it on behalf of Queen Elizabeth—a very fine woman, whom I personally admire—it does not become the law of the land. Therefore, if this was not a bill that was in the best interests of the country—and New Zealand First is, obviously, supporting it; we believe it is—that one little clause around the start date, around Royal assent, would actually save the country. It is the last backstop to bad decisions by this House. I am not sure that that is where Mr Hipkins wanted to go with his contribution, but from a New Zealand First perspective, or from my perspective specifically, this particular clause is incredibly important. That piece around Royal assent keeps us safe.

One of the things we must never get rid of with regard to start dates and pieces of legislation is the Royal assent. That is our last protection for bad legislation. The Governor-General can decide to sign any legislation. People might decide to do away with the Governor-General but until he signs a bill, it cannot be put in place. I agree with Mr Hipkins that that is a very, very important clause. More members of the Government should stand and take calls on that particular clause because I believe that they obviously would support it. They would support the start date being on Monday possibly, or Tuesday if the Governor-General has appointments.

💬 Kris Faafoi: We could still be sitting on Monday.

Oh, well, there you go. You see, it may not get out of the House by then. But the moment it gets to the Governor-General he will make a decision as to whether it is in the best interests of this country. We all know what a fine man the Governor-General is. All of us trust the Governor-General and his judgment. Therefore, that clause, again, is a very, very important clause inside this piece of legislation. Kia ora.

I will give a member the call. I would just like to make the point that we have well traversed the Royal assent, even in various European countries, by the Governor-General as well as the Queen and the King of Belgium. So I look forward to the next speaker cutting a fresh track on this very narrow clause.

There is a strong precedent in this House not to bring the Chair into the debate. I am going to depart from that on this occasion only and very gently to note that you are a member, in another capacity, of the esteemed Regulations Review Committee, on which, in fact, we serve together. The Chair will have almost, I am sure, uppermost in his mind at this time that the Regulations Review Committee has a tradition of objecting to legislation where the date of Royal assent or the date on which a bill comes into force is not specified in the primary legislation. That is seen as very, very poor drafting practice.

What normally happens, as you know, is that the Regulations Review Committee will write to the substantive subject select committee—in this case, it would be the Commerce Committee—asking them to invite the Minister to reconsider whether in fact there should be a fixed date put into the equivalent clause, the commencement clause.

That is where we run into problems with this bill. I guess it is yet another little proof of why we should not be here on a Friday night trying to ram a bill like this through all stages, because there is no substantive select committee that the Regulations Review Committee can write to to object about the fact that it does not have a proper commencement clause in it. This is an open-ended commencement clause. It is poor drafting practice. It would be pulled up by the Regulations Review Committee, and the Commerce Committee would have to deal with it. The Commerce Committee would probably then write to the Minister. There would be an amendment made in the usual way, and there would usually be either a fixed date for commencement or a deadline for commencement.

That is particularly odious and improper when it comes to a tax bill. This is a tax bill. This raises taxes. Apart from the fact it is breaking an election promise, it is a serious matter. There should be no taxation without representation. Representation includes the full select committee process. So here is a tax bill being rammed through Parliament without a select committee process and with an improper commencement clause.

The Regulations Review Committee would take this very, very seriously. It would write to the subject select committee, the Commerce Committee, and it would ask for an amendment or consideration of an amendment on that point. It is not too late for the Minister, given that the Minister has seen fit not to send this to a substantive committee, to respond to that point and to assure the Committee in some way as to the timing of the commencement. It may be that the Government may see fit, even in the time that is still available, to amend this commencement clause by way of Supplementary Order Paper, to give at the very least a back-end assurance to the public that there will be some certainty about this.

As my colleague Mr Hipkins, Dr Hipkins, has said, there is a very important precedent, which we are not allowed now to refer to, from a small European country where Royal assent was withheld on a matter of almost equal import as this unjustified, unwarranted, and improperly drafted piece of tax law that we are ramming through the House in the dead of a Friday night.

I invite you, Mr Chairman, to ask the Minister to take a call, and for you to at least share with the Committee your experiences on the Regulations Review Committee where you know—

The CHAIRPERSON (Hon Chester Borrows): Order! Please be seated. The member knows that it is wrong for him to draw the Chairman into the debate. I certainly will not be jumping when he yanks my chain.

Thank you for the admonition, Mr Chairman. It must be getting late, but since you put it in those terms, your chain shall be completely unyanked by the Labour Party. But it is not too late for the Government to yank this bill from the House, because this bill is improperly drafted. This is an improper commencement clause for a tax bill.

We should not be pushing tax bills through in the dead of night. We should not be doing it when the Government said that there were not going to be any more tax laws, no new taxes—well, here we have got one. It was brought in through urgency without a select committee process, flying in the face of established constitutional convention. This is legislation for cowboys, and the Labour Party wants none of it.

I move, That the question be now put.

I am very happy to take a call on this commencement clause. Mr Chairman, with the greatest respect I have listened to your calls to move on beyond the Royal assent, but it has become somewhat of a debating point in this Committee tonight around the circumstances in which the Governor-General, on behalf of the Sovereign, can actually—could they, or when could they—refuse the Royal assent. When such questions come up, being the hard-working parliamentarian that I am, I like to go to the source and consult McGee to see what the circumstances are under which this could occur. I think it is important that we clear up this debating point in this Committee tonight and actually see what the facts are around this. There is no longer explicit statutory recognition of a power to withhold the Royal assent, as there was in a previous law. This was admitted in 1986 as being unnecessary. It was felt that to re-enact—

The CHAIRPERSON (Hon Chester Borrows): Order! Just for clarification for the member, speculation as to the inclination of the Sovereign or the Governor-General is not relevant to the detail of this clause. I previously warned all members that we have pretty much covered this ground. So I ask the member to explore new territory, take us to new depths, in this clause.

Just speaking to the point of order, Mr Chair.

The CHAIRPERSON (Hon Chester Borrows): Not challenging it in any way?

No, I am seeking your clarification, Mr Chair, and asking for some guidance from you in that there has been a debating point established around whether or not—I am not questioning the reputation of the Sovereign—they could do that. I am just asking your guidance how it is that a member can address what has become a debating point in this debate.

The CHAIRPERSON (Hon Chester Borrows): Well, fortunately for me as Chair I am the sole judge of the scope of this debate and I have judged that we have traversed that. I believe that it has reached the full extent of the scope in relation to the Royal assent in this matter. We are looking for new territory. If the member has not got any new territory to explore, there are plenty of other people seeking the call—Mr Faafoi, for one.

Thank you, Mr Chairman. I appreciate your guidance in this matter. It is always useful to have your wisdom shared with us. We always appreciate it greatly.

In terms of the commencement date on which this bill receives the Royal assent and when it comes in to date, my colleague Chris Hipkins has already talked about when that might be. I think there are some serious matters that remain unresolved around when it is and how it is that we treat taxation law in regard to the Royal assent, because it goes back to some of the material that was covered. There is a clear intersection here between clauses 1 and 2, around what it is that this bill, the Telecommunications (Development Levy) Amendment Bill is called. This is called a development levy bill, but in reality this is a taxation bill, and as my colleague the Hon David Cunliffe has pointed out in his previous contribution, actually, there are some very serious questions that we need to ask around taxation law and how that may be treated. Mr Cunliffe raised a very serious point about the Regulations Review Committee and how this would be treated if it were going through a regular select committee process, and how it is that this might have to be treated differently. I think it is important when we are using this mechanism of urgency that we are not circumventing what are some very important conventions in this House, and that is that people in this country need to have the peace of mind that they do not have a Government or a Parliament, indeed, that will pass legislation that unfairly taxes, that there are important checks on that, and one of those is that—

💬 Clare Curran: Shouldn’t be doing it under urgency.

—we should not be doing it under urgency and, if we are, we should at least be putting some of the normal procedures around it. I know whether or not the Sovereign would give this piece of legislation Royal assent has been ruled out. Royal assent is not something we would ever consider talking about again, but I am sure other members of our team here in Labour will have very serious questions that they will need to raise around this very important clause 2 of this legislation, being the commencement clause. We should always ask the serious questions of any bill that we as legislators are asked to pass. We should never just think of ourselves as rubber-stampers. We should examine legislation clause by clause, and we should always be asking questions, especially when we are not going through the proper processes that we would expect of a select committee of this House. So there are important questions to be answered and I invite the Minister in the chair to take a call and to address some of these very, very important questions that members have put to him because this is what we deserve as a Parliament.

Thank you very much, Mr Chair, for the opportunity to speak to clause 2. As your predecessor in the Chair has mentioned, it is a very narrow clause. I do not intend to go into some of the issues in terms of the Royal assent, but I do want to take this opportunity to talk about the commencement date. We do not know when this bill will come into force—it may be Monday, it may be Tuesday—but when it does come into effect, it will set in train a chain of events to allow the Government to negotiate with other telecommunications companies not only to allow the tax that is going to be collected under this piece of legislation to be collected but also, because we know that this bill will become an Act, to allow the second stage of the Rural Broadband Initiative to get under way.

Although we on this side of the Chamber have noted some concerns about that, I did want to use that in terms of the chain of events that starts when this bill becomes law to take issue with something that New Zealand First member Richard Prosser said earlier on. He suggested that members on this side of the Chamber—or from this party, more or less—were using constituents who were coming to us into our electorate offices by dangling them out there to use as examples of people we do not really care about. I would say to Mr Prosser that that could not be further from the truth. There are a number of electorate MPs on this side of the Chamber who have had a number of constituents come to them and ask them why their rural broadband is so rubbish.

One example of that is someone in my electorate. Like Chris Hipkins, I have got a mixed electorate. I have got the rural areas of Pukerua Bay and some rural areas in Pāuatahanui, and—

💬 Brett Hudson: Pukerua Bay is not rural.

Well, there is a farm there. You want to come and have a look at it. It has got livestock and everything—come and have a look. One person who lives in those rural areas came to me and said: “Look, my internet connection is not what I want it to be because of where I am located.”, and he was in a rural area. So I looked at that case. I took it to Vodafone and said: “Look, this chap lives here.”, and I am just about to get to my point, Mr Chair.

The CHAIRPERSON (Hon Trevor Mallard): Well, the member had better, because if he does not, his call will be terminated.

The outcome of that conversation was: “You’re going to have to wait for the second phase of the Rural Broadband Initiative.” because he was not going to be in phase one. It is absolutely crucial for him to now get his broadband up to the speed that he wants. Is the commencement date of this piece of legislation—I will give him that. We want Rural Broadband Initiative 2 to start rolling out, and this piece of legislation will commence probably on Monday, or it might be Tuesday, if we are still here.

There are a lot of people who, I guess, are waiting for this piece of legislation to go through, but our point of issue with it commencing on that date is that we do not think we have had a justification or a good analysis of the first piece of legislation, which saw Rural Broadband Initiative 1 come in. So before this piece of legislation comes into force, or commences, we do not want this piece of legislation to go through without the right scrutiny of the first tranche of Rural Broadband Initiative 1.

Do not commence this bill to spend $150 million without looking at the first piece of legislation, which came in to bring in Rural Broadband Initiative 1, which was worth $300 million. We are not sure whether it has been effective, so we do not think this piece of legislation should go through, which is why we are not supporting it. Why? This piece of legislation is to expend $150 million. We on this side of the Chamber think that that is a lot of money. The Government does not seem to care about the accountability of expending $150 million. We would like a closer look at how effective that first $300 million has been before we go anywhere near letting this piece of legislation go through.

To Mr Prosser, I would say please do not take the examples we have used in this debate as something you can simply throw away. They are people whom we have cared for. It is our duty as electorate MPs to make sure that the Rural Broadband Initiative is as best as it can be. When this legislation commences, hopefully that person—

I move, That the question be now put.

I am not going to take it now, but I am going to issue a warning and it—

💬 Dr Russel Norman: Oh, come on, Trevor.

The CHAIRPERSON (Hon Trevor Mallard): Who was that? Can I remind the member of what happened to Mr Mark earlier in the day, for interjecting in a similar circumstance.

💬 Hon Member: What happened?

The CHAIRPERSON (Hon Trevor Mallard): Mr Mark had a short holiday from the Chamber. So I now give the Committee a general warning about interjecting when the Chairman—[Interruption] Yes, Mr Williamson will be required to stay, if that is the case. The point that I am going to make to Mr Faafoi is that this is a bill about collecting money and not spending it, so any further arguments about when the money is spent will not be tolerated.

I am not quite sure of how much time I have got left to take. I might have another 5 minutes, but I am not sure. I am sure the bell will tell me.

We do not believe that this piece of legislation should continue, and I take your point that this piece of legislation is about the collection of a levy or a tax, as we have argued on this side of the Chamber. We do, though, think that it should have gone through the proper process before it did start collecting this tax.

💬 Jacqui Dean: I raise a point of order, Mr Chairperson. I am just seeking your assistance. I did rise and request a closure motion, which I do not know that you addressed, but you then called upon a member to make a speech who had not actually asked for the call.

The CHAIRPERSON (Hon Trevor Mallard): Well, actually he had, and he asked at the same time as the member asked for the closure. He called at that point and that is the right time to call. Actually, by going to another member, it is probably a pretty clear indication of my decision on the closure motion. If the member wants me to sort of underline it, I had declined it.

Thank you very much, Mr Chair, for that clarification of your ruling. I do not want to unnecessarily take up the time of the Committee, but there is—from what the Minister said in one of her Committee stage contributions—a fair bit of negotiation that has to happen from the commencement date up until about June 2016, when I understand that the Rural Broadband Initiative 2 comes into force. I think, from a couple of the press releases we have seen, that there is a fair bit of negotiation that needs to be done between the telecommunications companies and the Government before this piece of legislation can actually become effective and until those taxes can start being collected.

We have heard a submission via a press release from the Telecommunications Carriers Forum. From the commencement of this piece of legislation until—

OK, I have now decided that the member has struggled for long enough.