Estimates Debate — Economic Development and Infrastructure Sector

Members, we come first to the votes in the Economic Development and Infrastructure Sector—volume B.5, volume 1. The question is that Vote Business, Science and Innovation, Vote Canterbury Earthquake Recovery, Vote Labour Market, and Vote Transport stand part of the schedules.

I am very pleased to stand to take this first call on the Appropriation (2015/16 Estimates) Bill. Looking at this sector, the economic development and infrastructure sector, it is very important for us to understand and appreciate that life, development, growth, and economic opportunity in New Zealand rely upon many systems. Just as a human body exists through diverse systems, so does our economic vitality.

I want to talk about the transportation system in our country, which enables economic development, growth, and prosperity within our communities. Transport is a critical component of daily life for all New Zealand businesses and individuals. It connects businesses to their markets and connects individuals to their jobs and to educational, social, and leisure activities.

New Zealand has a vibrant transport sector that comprises around 5 percent of total employment and 5 percent of gross domestic product. In total, the Government has $60 billion worth of transport assets, including 11,000 kilometres of State highways, 83,000 kilometres of local roads, and over 4,000 kilometres of rail track, and New Zealand has 14 exporting ports and six international airports. If we are going to be a country that engages in the global economy, all of these vital transport links are important to us.

The National-led Government is working hard for all New Zealanders. We have a clear plan for this term and we are continuing to build a stronger economy that creates more jobs, lifts incomes, and provides the essential services and support that families need. The Business Growth Agenda, which the Minister for Economic Development, the Hon Steven Joyce, leads, includes a specific goal to raise exports to 40 percent of GDP by the mid-2020s. More generally, the Business Growth Agenda is about the Government’s focus on economic growth as a key mechanism to create better opportunities for all New Zealanders, but the transport system has an important supporting role in ensuring that the additional exports, the associated input goods, are able to move efficiently and effectively around the country and internationally to our global markets.

The transport system supports economic growth by providing the domestic transport networks and international connectivity necessary for the movement of goods. To do this well, the transport system needs to be efficient and effective, the existing transport assets need to be well utilised, and new investment needs to deliver real results for New Zealand. Otherwise, the transport system is imposing additional costs on the economy and reducing the international competitiveness of our firms.

Over the past 3 years National has spent nearly $11 billion on improving our transport infrastructure, and we have earmarked nearly another $40 billion over the next decade. The appropriation sought in 2015-16 for Vote Transport increased by 10.3 percent to $4.27 billion from an estimated actual spending in 2014-15 of $3.87 billion. Most of the vote—some 91 percent—provides funding for roading, with 6 percent for rail, 3 percent for the Ministry of Transport, transport Crown entities, MetService, and SuperGold card transport concessions.

The elephant in the room is always Auckland. At the estimates hearing the Minister said to us that in Auckland, central government subsidises each bus fare by $2 to $3 and each rail fare by $7 to $8. The Government has spent $1.6 billion on rail infrastructure improvements in Auckland, with $500 million of that in the form of a loan.

Roads of national significance are like the backbone of our transport infrastructure. Believe it or not, we in Taranaki are not jealous about Auckland’s new roads. We have got a fantastic new bridge and new infrastructure being put in place north of our city. Why? Because we accept that funding motorway expansions in the Waikato and Auckland is helping businesses in Taranaki, because those northern roads are as much a part of the journey to market as the road out of New Plymouth is. We depend on those northern roads for access. And, arguably, as all the regional State highways feed into our big export ports, the roads where this freight load converges are indeed roads of national significance. Every hour less that a truck and driver sits in a gridlocked Auckland motorway—

I get up to speak particularly about the economic development spend that we examined in the estimates hearings. What we learnt and what was affirmed for us again is that this is a Government that is failing to deliver on its central plank, and that is, in the economic development area, to grow exports as a proportion of our economy from 30 percent up to 40 percent. The Minister for Economic Development has been forced to admit that they are dropping. They are projected next year to go from the 27 percent they are already down at down to 26 percent. This is a Government that is failing to deliver on its central objective of growing exports as a proportion of GDP. This Minister talks about the Business Growth Agenda. That is his target. He is a Minister who is failing to meet his own target. He is a Minister who is meddling in his department—meddling and creating a failing ministry.

Treasury said it was always going to be an uphill battle and that the efficiency gains projected to be gained by the Ministry of Business, Innovation and Employment would never be realised. But what it did not count on, and what it did not brief on, was a Minister who was meddling in the ministry: a Minister who was choosing the layout—whether portrait or landscape—of the glossy brochures that go out; a Minister who was in there wordsmithing his own previous documents and correcting them and trying to make them sound better, even though they had already been in print in his name; and a Minister who was in there choosing the colour of the brochures. The front cover, the back cover—what colour should they be? That is where the Minister is. There are 40-odd spin doctors in there trying to clean up after the Minister. They have got an uphill battle, because this Government is failing to achieve the central target of the economic development agenda, and that is to grow exports as a proportion of GDP.

In the estimates hearings we looked into the Ministry of Business, Innovation and Employment’s spending, which we all know about now as taxpayers. We looked into the fact that it had spent $60,000 on a sign out the front of the Ministry of Business, Innovation and Employment advertising where it was. We looked into the fact that it has a $140,000 TV screen in its foyer. We looked into the fact that it has a $260,000 sun deck with barbecues on it. We looked into the fact that it has a $23,000 fridge. We looked into the fact that it has a $74,000 reception desk, which is curved—a curved reception desk. It had to be curved because the $140,000 TV is curved and the desk had to match it. This is the kind of spending this Minister is presiding over. He is the one who signed off the budget with all of these items in it—and hair straighteners to boot. This is a Minister failing to concentrate on the big targets he set himself and instead is focused on spending and spending and spending. This is a Minister out of touch if he thinks ordinary New Zealanders think that that is OK.

Of course, as the Minister he will claim, his job is to set the general tone. Minister Joyce will say: “My job is to set the general tone.” Sure, he signs off the budget; sure, he is accountable to this Committee for the spending. Well, I would say: “How many small and medium enterprises around the country have $140,000 TV screens in their foyers? How many have $260,000 sun decks?”.

💬 Carmel Sepuloni: Not many, if any.

“Not many, if any.” my colleague says. That is true. I think that when the Minister said to the Commerce Committee that he did not have that information in front of him, he was fudging. I bet he has looked into it. When he then answered questions in the House he conveniently did not have that information in front of him either. I think he knows that he is failing to deliver on his targets and he is failing to meet the expectations of the small and medium enterprises that need to be grown if we are going to have a diverse economy. That leaves us vulnerable, as the dairy prices have tumbled. The Government beats up on the farmers, but, actually, it is the Government’s fault for not diversifying the economy and not making sure there are others who can shoulder the burden of growing our economy. Leaving it all to the farmers and then beating them up when times are bad is not a good strategy, Mr Joyce, and New Zealand is not fooled by it.

Of course there are plenty of other things that we canvassed in there, and there are so many that it is hard to bring them into this Chamber, because this Minister is failing in so many areas. The real median weekly wage—well, this Minister led, of course, the campaign in Northland that failed so spectacularly. Since then we have had statistics out that have shown that the real weekly median wage, which used to be higher in Taranaki than it is in Northland, is now lower. It used to be higher and now it is the same, roughly, in Taranaki. In Gisborne and in Hawke’s Bay it is now lower than in Northland. These are the kinds of statistics that keep coming out and show how this Government is failing the regions around New Zealand. We cannot afford for the regions to get behind. We need everybody to be succeeding if New Zealand is going to get ahead. The forgone growth is costing us all. And, of course, unemployment in Northland has gone from 7 to 8 percent under this Government. In the Manawatū and Wanganui it has gone from 3 to 9 percent. Actually, plenty of regions are hurting. The Government will try to pretend Northland is an isolated case, but this Government is failing all around.

Well, with the greatest respect to our dear friend opposite, David Clark, that speech made a word cloud seem coherent in its analysis of the New Zealand economy. I have never seen such a string of platitudes incoherently brought together in such a way to not achieve a single thing, but that is Dr Clark.

The fundamental challenge for the New Zealand economy is to grow faster than other parts of the world. Since this Government has been in office, no matter what Mr Clark says, this country has performed better than most developed countries in the world. Why is that? Because this Government and the agencies that support it are doing the job of encouraging businesses to grow, invest, have confidence, and hire more people. There have been 74,000 additional new jobs in the last year and, actually, a growth rate of 2.6 percent in the year to March—2.6 percent growth compared with 2.3 in Australia, 2.4 in the UK, 2.7 in the US, 2.1 in Canada, minus 0.1 percent in Japan, and 1 percent in Germany.

Fundamentally, the Opposition members go on about diversification of the New Zealand economy. Well, it is happening in front of their eyes and they hate it. They talk the New Zealand economy down. They cannot bring themselves to look at the information and communications technology industry, which is growing flat out across New Zealand, to the point where we are adding 2,000 or 3,000 new jobs a year. They cannot bring themselves to look at the wine industry, which is growing dramatically. They cannot bring themselves to look at the kiwifruit industry, which has recovered incredibly well. They cannot look at the apple industry, which is also growing well. They cannot look at the beef industry.

They cannot look at the high-tech manufacturing industry. The BNZ-BusinessNZ Performance of Manufacturing Index, the indicator for growth in manufacturing, was 55 last Friday. The services index today was 58. They cannot bring themselves to look at that. The tourism industry grew 9 percent in the last month. In June, the coldest month of the year, it grew 9 percent. The international education industry is growing dramatically and is now at $2.85 billion.

💬 Dr David Clark: No one believes you, Steven.

The construction sector is also growing dramatically. The only person who does not believe us is Mr Clark, sitting over there with his eyes firmly shut.

So, yes, it is a challenging time for the dairy industry, but the good news is that New Zealand has a strong and diverse economy as a result of the confidence that the businesses express because of such things as the management of the New Zealand economy by Bill English and the Business Growth Agenda, which is the most comprehensive programme of work in the New Zealand economy in decades—350 different initiatives. Weirdly, 3 years in, the Opposition still has not read it, but then that probably indicates the level of depth and analysis of its approach. The export sector, the free-trade agreement with Korea, the World Trade Organization’s Government procurement—that stuff is not going to make headlines, but I tell you what, it means a lot to manufacturers all over New Zealand.

I talked about information and communications technology.

On the tourism side, there are such things as the national cycle trails, which Opposition members have gone a bit quiet on, because they know that regional New Zealand knows that it is working for them; things like the convention centre, which they are opposed to and will still be opposed to, but they will still turn up at the opening, that sort of thing; and there is investment, encouragement of investment, encouragement of skills. We talked about the information and communications technology graduate skills today; the research and development tax losses that we have cashed out, the research and development growth grant programme, which is growing—that is in the innovation space. In the natural resources sector there is a lot of work going on there. There are the regional growth programmes, which again they do not want to talk about.

So if you forget all the industries that are doing well, if you forget all the Government initiatives, if you close your eyes to all the regional growth programmes, and if you determinedly sit there and say that it is the worst economy in 25 years, then Mr Clark may be able to convince himself that nothing has happened, but he is wrong.

The story of this National Government’s transport policy deserves to be told, and it goes something like this. This Government under Steven Joyce’s leadership as a transport Minister, in its early years, took the transport budget, which amounts to about $3.5 billion a year, and decided to politicise it and treat it as a party political slush fund for the National Party. That is what it did. It was an act of supreme cynicism and it made the decision, against the advice of officials, against the advice of all of the best benefit-cost ratios, all of the analysis, to pour billions of dollars into a handful of hand-picked motorway projects that had not even been subject to the most basic economic analysis when this Government committed the money for those projects—a handful of urban motorway projects.

It was pork-barrel politics on an industrial scale, and that is the defining quality of this Government’s transport policy. The result of that has been that every other category of the transport budget, whether it is urban public transport or local roads in regional New Zealand, has been cut and squeezed and neglected for the last 7 years. This Government has been willing to run down and neglect a multibillion-dollar asset that belongs to the people of this country in the form of the local roads and State highways. It has been content to neglect the transport needs of our country’s biggest city, making itself, this National Government, a brake on Auckland’s economic growth and prosperity.

We did the figures when the Government policy statement on transport came out and then again when the National Land Transport Fund came out, and what those numbers show is that for regional New Zealand, outside of the main urban centres, spending on roads has dropped by 13 percent in real terms between 2008 and 2013. That amounts to a real cut of $163 million. That is a reduction in the spending on local and regional roads by this National Government during its 7 years in office so far—a 13 percent cut in real terms.

What is the upshot? The consequence of that cut in funding to regional New Zealand’s roads is that the roads themselves fall into disrepair and pose a threat to the safety of people using those roads in regional New Zealand, and this National Government, having blamed councils all around New Zealand for the last 7 years for being profligate spenders, all its transport policy has done is load more and more pressure on to the ratepayers in regional New Zealand.

Take Southland—about 10,000 ratepayers—they have had a massive dairying boom there over the last decade or so. They have the largest roading network outside the Auckland super-city, and yet they have had successive cuts to their local road funding. Eric Roy, the former member for Invercargill, was in the Southland Times explaining to his constituents why their road funding was cut by this National Government. He was very candid—that is what I liked about Eric Roy. He said that until we have built all the roads of national significance, the roads in Southland are just going to have to wait.

That is a message that he could have delivered to any town, any community throughout this country, because that has been the effect of this Government’s transport policy on regional New Zealand. The regions are missing out. If you look at average funding per person nationwide, the average is $648 per person. In the regions it is only $566 per person. Per kilometre, nationwide there is an average spend of $11,430 under National. In the regions, it is only $9,230. The regions are getting done like a dog’s dinner under National.

The second thing I wanted to say is that in the last election, as we have repeatedly seen from this Government, it was dragged kicking and screaming, it was embarrassed publicly, and then finally it threw a little bone to try to keep people quiet, and it announced $212 million of regional road funding. But the following year, in the Budget, it allocated only $97 million for those roads, although it promised $212 million. How cynical can you get? We saw this, speaking of cynicism, with the bridges of Northland—

Thanks for the opportunity. I just wanted to note the eloquence of the Minister for Economic Development, who spoke so wonderfully just a few moments ago. What I have to say, though, is that it is a shame that that eloquence, that wonderful turn of phrase, could not be applied to his super ministry, to get his staff in line in order to create those synergies that were promised to the people of New Zealand. In terms of eloquent messages at the moment, as well, it seems like National is putting out this wonderful argument that if anyone talks about how bad things are in New Zealand, it is their fault. If you talk about how bad things are, it is your fault. So, apparently, by talking about it tonight, it is going to be my fault that the economy is not doing that great.

Speaking about infrastructure and economic development, though, the regions have been short-changed in this appropriations round, in the 2015-16 appropriations round. Economic development, without a doubt, will be more meaningful for each and every New Zealander if this Government would actually focus on our regions and, more important, on the people in them. Infrastructure development—we were talking today. We have just come back from meeting with our constituents. We were talking about roading in Northland, funnily enough. We are encouraging cruise ships to come to the port, which is wonderful, and then what they are doing is they are taking them out to wonderful tourist activities out in the Millennium Kauri Forest, but a lot of that road—and it was spoken about before, how there has been a 13 percent cut in our regions’ roading, for example—is gravel. So there is absolutely no doubt that we are undermining our tourism, which the Minister spoke of how wonderful it was. We are undermining it with inappropriate and lacklustre appropriations in this round.

What this Government needs to do is to be considered in its approach. What it is failing to acknowledge as well is the appropriations to the broadband roll-out, for example.

💬 Brett Hudson: Two billion?

No, there were no appropriations attached to the broadband roll-out because the Government has not acknowledged that there is an actual problem with the broadband roll-out in New Zealand. So what we have at the moment is, again, another discussion with people in rural communities, in our regions, telling us that not only can they not connect because of structural issues with the roll-out that were inherent from the start—the problems were there and transparent from the start—but we were having some wonderful conversations about the broadband roll-out and the fibre connections. And what businesses in our rural sector, in our regions, were telling us, which is ridiculous, was that as they were connecting and opting in to this wonderful option to grow their business, their internet speeds were slowing down. They were measuring their internet speed and they were able to tell us categorically that it was slower than dial up—dial up from 10 years ago. That is how slow it has become, because the infrastructure—the investment, the lack of foresight of this Government in terms of these appropriations for infrastructure and for economic development—is just not there.

National Ministers might not know this—they seem to go rural only when there is a by-election—but rural businesses only 10 minutes from the city are experiencing these problems. The lines have been upgraded but the infrastructure is not coping. It is ridiculous. Previously, I have spoken in this House about the implications of the broadband roll-out for rural businesses. The reality is that rural businesses have fewer websites, less internet connectivity, and they are not bothering with this so-called online economy because they cannot take advantage of it.

The electricity industry—another infrastructure and economic development issue that seems to have been left by the by, by this Government. We have had conversations put to New Zealanders from the Electricity Authority asking whether regions should pay more for their electricity through line charges. They have put it that, essentially, it is going to be the absolute nth degree of user-pays. So we are not going to share structural costs; we cannot, you know, share this with New Zealanders. It is going to be the regions—

It is a great pleasure and a privilege to be Minister of Transport and Minister of Energy and Resources in this John Key - led National Government. That is because this is the strongest infrastructure Government in many a decade. This is the strongest party and Government for infrastructure that this fine country of ours has had for many a decade. I can tell you that that is so for many reasons, and I will do. I will give one anecdote: it was a great pleasure appearing before the select committee in the areas that I have responsibility for, because we have such a good story to tell. They were fireside chats that we had in those committees, because the story that we have in transport and in energy is absolutely fantastic, because we are delivering results in transport for this country.

Let me talk a bit about that. The New Zealand Land Transport Plan—the biggest ever across every single class—was recently put out by the New Zealand Transport Agency. We are spending more where it is needed in every single class that there is in land transport, whether it is in the big cities, where right at the moment, in Auckland, we have got the biggest roading project ever coming to completion in New Zealand—the western ring route, with Alice boring through and doing a tremendous job there—or whether it is Tauranga Eastern Link, which very soon will be open to the public. It will be the best road in the country in New Zealand when it is opened very shortly. It is absolutely fit-for-purpose for connecting up those exporters that Steven Joyce was talking about—the kiwifruit growers, the productive sector of our country—to the best and biggest port. Whether it is in rural areas in the provinces, whether it is the Akarama curves in Northland, the passing lanes in Gisborne, the Normanby bypass in the centre, or the Kawarau Falls bridge lane this year, many, many millions—in fact, hundreds of millions of dollars—are going into regional roads to make sure that they are fit-for-purpose and are doing the job of getting exports to market efficiently and productively, and also of getting our people around this country safely.

We are multi-modal. I always love saying this for Julie Anne Genter’s benefit: it is this National Government that has delivered the biggest infrastructure investment in rail in many a decade—in Auckland, $1.6 billion for the electrification of rail. It is good to see the mayor and the council talking about this earlier this week. It is a real step change for that city. There has been over $3 billion in capital expenditure in rail since we have been in Government. That is truly significant, and yet, to some, it is never enough. Bus interchanges, park-and-rides—there has been a significant infrastructure spend on those. Just to show the multi-modal nature of this Government’s infrastructure investment, in the next 3 years there will be $333 million put into cycling on urban cycleways. It is a real step change for literally every urban area with over 30,000 people in this country. Whether it is Whangarei, Auckland, or Wellington—you name it—they are getting very strong investment, which is going to really deliver for the people of New Zealand.

In Auckland, which Phil Twyford talked about, of course we are engaging in an engagement process, because we do want to make sure that we are spending the money right on congestion and public transport. But in the meantime $1 billion a year is going into that city. We are not sitting here on our hands; we are the biggest investor in Auckland, bar none. Whether it is the Victoria Park Tunnel, whether it is the western ring route that I have spoken of, whether it is the Auckland-Manukau Eastern Transport Initiative, whether it is the East-West Link, we are getting on with the projects that we are being told are the ones that need to be focused on in order to really deliver for that city.

I am really excited about the way we are in transport, across the board, enabling technology and innovation to capture for transport users in New Zealand the benefits of what is happening around the world—whether it is mobility, whether it is ensuring that some of the really interesting car and ride-sharing innovations that are seeing more people in fewer cars are enabled in New Zealand, or whether it is the new unmanned aerial vehicles (UAVs), or drones, that people are talking about. We are making sure we have the most fit-for-purpose enabling regulations. It is going to be a pleasure working with Craig Foss, the Associate Minister of Transport, and to be part of seeing those new regulations come in very shortly—in fact, later this week.

I am glad that Fletcher Tabuteau spoke about energy and resources, because we can say with absolute clarity that today we have the most competitive and the most innovative electricity market that this country has ever seen. It is the most competitive—

💬 Hon Member: And expensive.

💬 Hon Member: It’s “Confused Mr Bridges”.

The Opposition says: “Well, is that really so? Where is your proof?”. Well, how about this: the latest Statistics New Zealand statistics show that the CPI figures on electricity prices, out today, show the annual rate of change in electricity prices paid by households. What do you think that was? What do the members of this House think? In the last year, there was 0 percent change in electricity prices for households.

💬 Fletcher Tabuteau: Whose electricity prices?

Well, let me give the members over on that side of the Chamber a little history lesson. I do not think that a 0 percent increase has ever happened this decade. I do not think that has ever happened this century. In fact, I think that we would be hard-pressed to find another year when there was a 0 percent increase in electricity prices for households, and that is because in this Government, on getting into office, Gerry Brownlee and Steven Joyce set up the Electricity Authority and got a competitive market going. We are seeing the most competitive, most innovative market with electricity retailers that we have ever seen, and the numbers there are at record levels. Off the top of my head, I think it is 14 new retailers offering 25 brands. Hot competition for customers is meaning that the big players are seeing their market share squeezed over time, as more and more people shop around.

It is a very strong record in infrastructure that this Government has, whether it is in transport, across the board; whether it is more investment going where it is really needed, in a multi-modal approach; or whether it is in energy and resources, where we are seeing the most competitive electricity market that we have ever seen, with 0 percent increases for households, made clear by Statistics New Zealand today. That is why I am incredibly proud to be part of this John Key - led National Government, which is making a difference in infrastructure and is the best Government in infrastructure that this country has seen in many a decade.

Thank you for the opportunity to talk about the labour market estimates, which I had something to do with, as well as my colleague Denise Roche. Just listening to the Minister of Transport, the Hon Simon Bridges, speaking about how fabulous everything is in terms of infrastructure, it always rings harsh in my ears when I walk down Karangahape Road or Lambton Quay or all the other infrastructure lying around the country, and in every second doorway there is a person lying on the ground or putting out a begging bowl, which is not how it was when I grew up. This is not the Aotearoa that I grew up in. So, if the labour market is going so great and infrastructure is all so wonderful, why for the last few years has it got worse and worse and worse, and there are more and more people whom people do not want to see, who cannot survive in the labour market as it now stands with the great successful National Government of the last God knows how many years? It is very disturbing for people with a conscience to see it, and it is not individual failure; it is structural failure.

However, there are two issues I want to address in terms of Vote Labour Market. One is a small phrase that was in one of the reports on the labour market estimates—I think it was under “Minimum employment standards”—that talked about reviewing the Equal Pay Act, which put a little chill down our spine. Since Kristine Bartlett took it to the Crown and won in a number of courts of law, proving that aged-care workers should be entitled to equal pay and that women-dominated occupations are unfairly paid—and we have a gender pay gap of 14.1 percent, which is, again, another failure of the labour market, which has definitely got worse in the last few years—the Government is now talking about changing the Equal Pay Act 1972. How it might change that, as a result of a court decision that finally was able to show, in law, that women are not fairly paid, is a worrying thing, because the decision has real meaning, and therefore there is real risk. It may mean the Government will change the law to prevent us from doing what is right.

I had a bill that would have had the Equal Pay Act amended to make it more transparent, which did not go far, but when it got introduced it became famous due to the meltdown by the Employers and Manufacturers Association chief executive officer, which some people will recall with horror. But what is the Government going to do to equal pay now that it has been proven that the law is not working, that women are not being paid fairly, and that something has to change? So we are very concerned about that and we are very concerned to see it in the Vote Labour Market estimates.

The other issue from the Vote Labour Market estimates that I want to talk about in terms of the Minister, and I was at the select committee when he spoke about this, is the issue of refugees. Basically, our country is in a pretty shameful state. We are now on the Security Council; we are now trying to hold our head up on the international stage. Yet we have a Government that refuses to lift the quota, and whenever we talk about lifting the quota it just starts talking about the rehabilitation of refugees and how much we are doing to make sure everything is fine.

But in reality we are, unfortunately, following one of the worst role models we could possibly follow at the moment in terms of refugees and asylum seekers, and that is Australia. Australia is taking a totalitarian approach towards refugees and is treating asylum seekers in a way that is pretty unbelievable, and now our own Minister for labour and for refugees is refusing to say that anything is going to change, when clearly everything needs to change. At the select committee I questioned him about the refugee quota, and he spent a lot of time avoiding the issue of improvement in the quota.

The Greens and others in this Chamber—a number of parties; virtually all of them except the Government—are asking only for the refugee quota to be improved to 1,000 a year, but the reality is that the Government is more influenced by the scare tactics and totalitarianism of the Australian Government’s attitude towards refugees than it is by the voices of reason from all the other parties. That is what the Minister of labour has said in the Vote Labour Market report—that there is no indication of improvement there—and only in the last few days something really disturbing has come to light about that.

Kia ora, Mr Chair. Thank you very much for the call. I was going to take a call on science and innovation in this particular part of debate, but there are a couple of things I want to address that have been previously spoken about by the Minister in the chair, Simon Bridges, and a previous Minister.

I challenge the current Minister in the chair, Simon Bridges, to outline for me where the northern border of the Auckland super-city is, because the Minister in the chair said that inside this Budget there are some amazing transport dollars being spent in Auckland City. That may very well be true for central Auckland, but I have firsthand accounts of people in Wellsford who are in the super-city of Auckland—they happen to sit in the Northland electorate; perhaps that is the problem, but they are in the super-city of Auckland—who are having to fill their own potholes in their own roads with lime that they themselves have bought, Minister, because there is no funding from this Government for those rural roads. I challenge the Minister to outline for me where the border of the super-city of Auckland is, because I am not very confident that the National Government understands exactly where it is. So that is the first thing.

The second thing is that Minister Joyce stood up and talked about the wonderful things that were done in this Budget with regard to international students. It may very well be true that we have schools saying that they actually have to spend 60 percent of their operations grants on international students because the funding from this Government is so low, and that is probably a topic we will get into in the next part of this debate around education. Let us talk for a moment about science and innovation, which is part of this particular debate.

I want to talk about the Performance-based Research Fund and the fact that this Government and Mr Joyce have said that the Performance-based Research Fund is the next big thing with regard to science research in this country and the way it is funded. That is what they say it is. The Performance-based Research Fund has $250 million and the Government is going to raise that amount to $300 million by 2017. Fantastic; the problem is the unintended consequences. What have we got going on, because there is a 100 percent competitive model with regard to research in this country? There is 100 percent competitive model with regard to scientific research.

This is the worst thing that has happened to science in this country since the blimming shake-up of the Department of Scientific and Industrial Research, which, I believe, was done by a National Government as well. That Minister in the chair would not know it because that member probably is not old enough to actually understand what happened in New Zealand then, but some of us are and some of us learnt from the mistakes that were made. When the Department of Scientific and Industrial Research closed, we lost scientist after scientist after scientist to Australia. It put us behind the mark internationally for years on end, and it is one of the reasons we need the Performance-based Research Fund, supposedly. We have to encourage scientists to come back.

But what is happening with the fund? The unintended consequences are that staff are being persuaded to resign on the understanding that they will be rehired after the round for the Performance-based Research Fund is completed. Staff are being put on fixed-term agreements to avoid them being counted in the fund’s measurements. Staff are being offered shorter fixed-term agreements to avoid them being counting in the fund’s measurements. Potential staff are not being employed to avoid having them being counted in Performance-based Research Fund scores. Does the Minister know about this? Does Minister Joyce know about this? Yes, he does. He sat at the Education and Science Committee and he said: “Yes, we are aware of the rorting.” Is the Government going to change it? No, not quickly. Why not? Because it is that commercial model, which the Government believes is all that is important.

Where is the public-good science? Where is the interest-led science that actually led to inventions that this country is now known internationally for? It has gone because this Government does not believe in funding public-good, interest-led science that adds to New Zealand’s future. This Government believes in funding only those who have some sort of pre-proven economic benefit.

How does that affect every business in, let us just say, Wellsford, or, let us just say, Te Hana, or, let us just say, Kerikeri? Do you know how it affects them? How it affects them is they do not even know it exists. They do not even know that dollar for dollar research investment exists. They do not even know what Callaghan Innovation does, and yet they are in the super-city of Auckland. They are sitting in a city where this Government, under legislation passed only 2 years ago, purchased the FoodBowl in Auckland to help food manufacturers and food production go from there to there and to packaging to send it overseas. Yet inside the northern borders of the super-city of Auckland they do not know a thing about it.

That is because this Government is urban-centric. This Government does not see the regions. This Government believes—

Supporting the rebuild of Canterbury and Christchurch remains one of the National-led Government’s main priorities. We want to make sure that Canterbury and Christchurch are even better places to live, to work, and to raise a family. Since the earthquakes of 2010 and 2011 we have appropriated $12.4 billion towards the recovery, the rebuild, and the regeneration. In the appropriations this year, 2015-16, there is $314 million for anchor projects; $60 million for red zone property acquisition and demolition costs, clearance, and management; and $80 million for managing the recovery and regeneration. We expect to spend $16.5 billion in the Canterbury community by 2019.

The enormous amounts of money, time, energy, and hard work that have been expended over the last 4 years in the rebuild make this one of the most expensive and ambitious undertakings in New Zealand history, and 4 years on Canterbury and Christchurch are mostly in good shape. Despite the gloom and doom forecasts, our population has increased, and that is because we acted decisively to retain the population and employment immediately after the earthquakes. About 540,000 people live in the Canterbury region now, and that is up 18,000 since the 2006 census. And the rebuild is going well. This March an estimated $13.4 billion worth of earthquake construction has been completed, and that represents about 42 percent of the progress through the physical rebuild. Our gross domestic product has risen. It was over 10 percent in the last calendar year. The unemployment rate is 3.5 percent. We can compare that with the national rate of 5.6 percent. In the last year Canterbury has increased jobs by 15,500.

So our city is coming alive at the same time, and I think there is real excitement about the activity in the centre city. We see the trend of Christchurch retail sales, which are continuing to increase, and our nightlife, including the restaurants, the bars, and the clubs, is back to about 95 percent of pre-earthquake levels. Recently the bus exchange opened, office blocks and retail developments are being completed daily, and by the end of 2016, 1,700 public sector workers will have returned to the central business district.

As a central city resident myself, I am delighted that the Government has signed agreements with Fletcher Living for the construction of 191 new homes on two new inner-city sites in the housing accord with the Christchurch City Council. Twenty percent of those new homes will be priced at or below $450,000, so that they are eligible for the Government’s new KiwiSaver HomeStart scheme for first-home buyers. But we are also increasing the number of houses in the city at a huge pace. There is the $800 million East and North Frame Residential Precinct, which will provide about 940 townhouses and apartments, and that will provide living accommodation for up to 2,200 people. I think this project is fantastic for Christchurch. It will bring residents into the city centre. It will provide a mix of housing, to encourage people at all stages of their lives, and they will literally be able to live, to work, and to play within the four avenues of the city. That will provide a great community spirit and a quality of life that will help families and businesses flourish.

So our rebuild is well under way, but how are the people of Canterbury feeling? We have been through some very tough times, as you all know, and we have certainly learnt that people deal with trauma differently. Every year we undertake the CERA Wellbeing Survey, and in September 2014, 77 percent of the people surveyed rated their quality of life as good or very good and 20 percent of them reported an improvement over the previous 12 months. This is the first time that these results have been comparable with the quality of the surveys about Christchurch pre-earthquake, so that indicates that we are getting back to where we were prior to the earthquakes.

I am pleased to make a contribution in the estimates debate on Vote Canterbury Earthquake Recovery in this new structure of bracketing portfolios, as we do. I was interested in the comments of the member Nicky Wagner, who has just resumed her seat, and I think she is actually not being straight with Cantabrians or with New Zealanders. I think she is demonstrating an arrogance that is surprising for someone of her background and I think she is out of touch with where we are in Canterbury.

The Government members have had a big push on saying how much money they are spending in Canterbury—$16.5 billion is the figure that is often quoted. Half of that money is actually Earthquake Commission cash, so immediately you can halve the contribution of the Government. It promised $6.7 billion in what it described as core Crown contributions—that is, roads, sewerage, schools, and hospitals. Well, from 2011, and the first promise, until the end of 2014 there has been $2 billion spent. That is all. The handbrake has been put on the Government investment in Canterbury to try to get to the surplus, but that still did not happen in this year’s Budget. Another failed promise from the Government—another failed attempt at getting a surplus.

Even more interestingly, though, when you look at the Budget and at the Canterbury earthquake recovery, the Reserve Bank says that in Canterbury there will be about $35 billion of insurance money going into the region—$35 billion. So if you look at what that sort of investment does to the Canterbury economy, particularly employment, combined with the logical housing boom that we are experiencing as a result of replacement houses paid for by insurance, then you will see an increase immediately. It is an increase in employment and a lower number of people on benefits, which is an immediate increase of $10 billion per annum in Crown income.

Just remember the original investment figure that the Government has been trumpeting. There are additional taxes on wages, which the Reserve Bank estimates is $4 billion, and additional GST, which the Government might get anyway and which goes back to the business, but that gives a total tax boost of $11 billion. So who is paying for the Canterbury recovery? Actually, it is mostly insurance companies, and the Government is likely to end up better off as a result of those insurance company investments and the growth stimulation.

This is not a plan for New Zealand’s future. You cannot have a plan that is built on the back of insurance payouts as a result of natural disasters. That is not the sort of future and security that New Zealanders need.

The Canterbury Earthquake Recovery Authority is—thank goodness—going out of existence in the very near future. Finally, we have a transition plan that is being prepared, looking at handing over the powers of the Canterbury Earthquake Recovery Authority to relevant Government departments, organisations, and, of course, our three local authorities.

In order to prepare for the winding up of its organisation, the Canterbury Earthquake Recovery Authority has recently doubled its communications budget, doubled the number of staff, and doubled the amount of money it is spending. I find that really puzzling. When the chief executive and the Minister for Canterbury Earthquake Recovery were asked: “Why are you doubling your budget when you are going out of existence in less than a year’s time?”, they said: “We need to keep people informed.” Well, that would be a first—that would be a first since that organisation was established. And they said: “There’s an increasing amount of work happening with the anchor projects.” Actually, every single anchor project, except the bus exchange, where there have been 15 accidents in less than 2 months as a result of the ingoing and outgoing traffic—that is a major success—has been delayed.

The Minister came to the select committee to talk about the vote. When he was asked about the delay, he blamed the media and said that it was all made up. We had the Prime Minister at the annual tourism conference saying that the convention centre in Christchurch has got a budget that has blown out and that it might not go ahead, and the Minister for Canterbury Earthquake Recovery said: “There is no blowout in the budget.” One of them is either mistaken or not telling the truth. They cannot both be right, and it is really hard to figure out. I would be backing the Prime Minister on this particular point. There are a number of other issues—

Well, this Government is committed to continuing New Zealand in the direction that has seen us grow faster than most of our trading partners in the OECD. Over 190,000 jobs have been created over the last 4 years and another 150,000 are forecast across the next 4 years. We are doing this through our Business Growth Agenda. Whether it is unlocking new markets, strengthening capital markets, harnessing natural resources, investing in innovation, investing in skilled and safer workforces, or investing in infrastructure, this Government is committed to keeping New Zealanders on the pathway to prosperity.

Across the way there, those members do not even understand business. From across there we witnessed just last week a trumpeted, trumped-up policy from Labour championing small business. What was that? It was a re-announcement of the Government’s discussion paper around provisional tax payments, released in May. They are bereft of ideas, bereft of leadership, and, quite frankly, bereft of talent, while we here are focused on doing the things that count to keep improving the lot for New Zealanders and their families.

I just want to raise the issue of infrastructure, within this ambit of the Business Growth Agenda. A few speakers ago, “the Professor” gave a lecture to us around the paucity of infrastructure investment, particularly broadband. Well, I do not know which library he consulted, but clearly he did not avail himself of the services of the Parliamentary Library. If he had, he would have learnt that in these appropriations the Government has made an appropriation for a further $210 million from the Future Investment Fund for ultra-fast broadband, to raise coverage to 80 percent of the population. An additional $100 million from the telecommunications development levy is to further increase coverage under the rural broadband infrastructure, and an additional $50 million is to take care of mobile black spots.

This is a Government that is investing in infrastructure that enables Kiwis and Kiwi businesses to be better connected and to take advantage of the opportunities that are there in this increasingly more-connected world. They make a real difference. For instance, in Timaru the information and communications technology sector is now the third-largest sector in that area. One example is an IT development company in Timaru that had a single employee before the ultra-fast broadband roll-out began and now has a dozen. It is able to offer its services not only around New Zealand but across the world. There is the doctor in Whangarei who now no longer needs to take his patients through an appointment system at the local hospital for retina scans but can do them in his practice and send the information on. There is the panel beater on the North Shore who can take photos of damage and transmit them electronically to the assessor in the insurance company, resulting in the approval coming through quicker, the customer’s car being back on the road sooner, and a far better, more efficient business for that panel beater. It is making a real difference.

The information and communications technology industry is growing at 9 percent per annum, year on year. It now contributes about 1.7 percent of GDP. That is one-third—one-third—of the dairy contribution to New Zealand, in one industry. That is without counting the wine industry or the beef and lamb industry or oil and gas exports or kiwifruit exports or all of the other things we are doing across the New Zealand economy. Within that information and communications technology industry, exports have been growing at 14 percent per annum over the last 6 years and have contributed approximately $930 million in exports in 2014.

This is a Government that is focused on diversifying our economy, creating opportunities for Kiwi businesses, making investments in infrastructure, and opening markets and strengthening our capital markets to ensure that investment flows in, which permits businesses to grow and to hire more people. This is a Government that is focused on creating a skilled workforce to meet the needs of a diversifying and growing economy. I now mention particularly the information and communications technology postgrad academies in Christchurch and Auckland that the Minister announced recently, and there is an announcement to come soon on that study in Wellington. So this Government is committed to continuing to grow New Zealand and to continuing to offer our people in our businesses brighter prospects with sound investments, sound policies, and sound actions.

Kia ora, Mr Chair. Ngā mihi nui ki a koutou. Kia ora. In my short 33 years on this planet we have seen phenomenal technological, economic, and social change, and, without doubt, I believe that in the next 33 years we are going to see even more. You can see some of that innovation in a warehouse next to Auckland Airport where Rocket Lab is assembling world-leading Electron rockets, but with carbon fibre, 3-D printed, battery-powered jet engines. You can see other companies like Xero selling from the Land of the Long White Cloud through the cloud, and competing globally. We have got some fantastic examples that highlight the potential of an innovative economy, but we should not be deluding ourselves that a few innovative companies make an innovative economy. What we have seen this week is an economic slow-down in China. Two recent polls have come out showing that consumer confidence has dipped sharply. Dairy prices have plunged a further 10 percent, and what we have seen in Treasury documents is that the tradables part of the sector has stagnated. In fact, the split between the tradables and non-tradables sector is the greatest in 2,000 years—concerning, concerning issues.

So what is the plan in National’s Budget and Budget estimates? Well, when you drill past the spin, what you can see is that the strategy is incredibly flawed. Under National we are working incredibly hard, but our wages are in the bottom half of the developed world. Under National our costs of living are judged the highest in purchasing power. Under National our economy has simplified and will become more dependent than ever on a few raw commodities. Under National we still spend less than half of the developed world average on research and development. Basically, under National we are not building those high-wage industries or sectors to compete into the future. Under National we are digging ourselves deeper and deeper into an economic hole. The plan seems to be a few token policies at the margins, a few more cows on paddocks—cram them on—and hoping to find some oil deep in our seas, but we are finding ourselves deeper and deeper in that hole. I believe in that old saying that—to paraphrase it—if you find yourself in a hole, it is time to stop digging. It should be the same in a coal shaft, in a deep-sea mine. It is time to stop digging. The way we have always done things is going to get us the result that has seen us slip down those economic rankings over succeeding decades.

On the science and innovation aspect of the Budget we have seen some token—token—gestures from Minister Steven Joyce. What we have seen is a funding approach that keeps us in the bottom half of the developed world. It is an approach that picks winners and that finds money for special prizes for the Government’s special friends in their special industries, like film. The funding models that benefit large businesses—the whole Crown research institute sector—is built around the old-fashioned, traditional economy, and we are seeing emerging start-ups feel that they are missing out on the research and development that they want to do to help get our country ahead.

There is a better way to support our economy and that is to build a genuinely innovative economy. My vision is one where we see Kiwis employed, competing globally, to come out with products and services with intellectual property. There is a limit to the amount of milk powder we can export around the world—we are seeing it in our waterways. There is no limit to the intellectual property—the software, the services—we could be exporting. As Sir Paul Callaghan said, we need to find those niches that are our strengths. We need to find an economy where we work smarter not just work harder, because if we do not, we risk what Greg Doone from PwC Digital’s strategy team argues—that if we are just a fast follower of the current speed of change, we are going to be left behind following yesterday’s trends.

The Green Party stands for an innovation economy, an internet economy, a clean-energy economy. To get there we need to adequately fund research and development to get us into that top half of the developed world. We need to support a culture of education, and this starts in our schools and in our tertiary institutions. We have to make sure those students studying at universities and polytechs are getting the courses, and that we are making them affordable so that they can be studying and preparing for the jobs that have not even been created yet. We need to get the settings right for the internet economy. We need to make sure we have got the right infrastructure, such as an internet cable to make sure the ultra-fast broadband and the Rural Broadband Initiative are not simply ultra-fast intranets. We need to make sure our teachers are being taught how to teach their kids digital skills. We need to support start-ups like the games sector. We need some thought leadership when it comes to areas like having a chief technology officer, as argued by Rod Drury. The Green Party’s vision is a smarter, higher-wage, more productive economy. If we keep spending less than half of what the developed world spends, we are not going to get there under National. Kia ora.

It is great to get an opportunity to focus on the labour market estimates part of this debate. In particular I want to talk about—because I do not think the National Government will want to talk about it—the shambles that the ACC motor vehicle levy system that it introduced through this estimates procedure has been. It has been like watching a slow-motion car wreck, because every other day there is a new problem that arises from what should have been a good-news story for the Government. It should have been a good-news story from the Government, but Government members will not even ask themselves patsy questions about it at question time because it has turned out to be such a shambles for them.

Why has it been a shambles? It has been a shambles because the Minister for ACC has made a fundamental error in changing the model. If the Minister had not done that, what she told the select committee was that every person with a motor vehicle that was petrol-driven would have got their ACC levies for their motor vehicle registration reduced to $104 a year. So everyone would have got that reduction. If it had been a non-petrol vehicle, everyone would have got a reduction to $186 per annum.

But what happened instead? Actually, more than a million people have ended up paying more than they needed to in ACC levies for their motor vehicle registration because of decisions that that Minister made—a decision to go to a model that is not only unfair and confusing but it turns out it has been expensive to administer and has made plenty of mistakes already. This is a system that came into being on just 1 July this year, and already that Minister has had to backtrack and reclassify the vehicle registrations and the levies for 24 models, and counting. I say “and counting” because in the first week alone the Minister had to backtrack on 18 classifications—18 models. That is not just 18 individual vehicles; that is 18 models of cars that had to be reclassified. A couple of days later that number had increased to 22 models, and as of today it is sitting at 24 models that have had to be reclassified. That is utter chaos.

But the worst thing about this is that it is simply a shift of the costs. It shifts the costs for motor vehicle registration from those who have the resources to buy the latest, greatest car on to those who do not have the income resources to buy the latest, flashest motor vehicle. How does it do that? Well, it actually gives $41 million in savings to people at the top, who can afford the better cars, and it shifts $41 million on to those who can least afford it. Who are those people? They are the young—our children who are buying their first car. It is the elderly—people on fixed incomes who, as they come up to their retirement ages, buy the car that will last them through their retirement. They are the people who are going to be pinged by this and are paying more than they should—not because ACC made a mistake; not because the ACC system is in trouble, but because that Minister made a fundamental mistake. She bought the argument that somehow, if people could save a few dollars every year on their motor vehicle registration, suddenly that was going to give them the thousands of dollars that they would need to upgrade their car to the latest, greatest model. Well, Minister, that is just a folly and everyone in New Zealand knows it.

So we have ended up in the situation where this should have been a good-news story for all New Zealanders and for the Government. It should have been that everyone got a reduction in their levy. For most of us it would be $104 that the levy would have been reduced to. But, instead, we have got this complete chaos going on, with a system that is fundamentally flawed. I can guarantee the Committee that this is not the end of this story. Every day that goes by, more and more vehicles are going to be reassessed. And then there is the sleight of hand—

Goodness me, I think I might be the final speaker on the economic development and infrastructure sector in the estimates debate. There does not seem to be anybody else jumping up for this particular—

💬 Hon David Cunliffe: No, no.

Oh, you have got a call to go. I might not be the last one.

After the delivery that we got from the Hon Simon Bridges, I have to say that I had a little bit of sick in my mouth and felt a bit woozy from all the propaganda that I was hearing from that side of the Chamber. To be fair, I think Mr Bridges would make a better job of writing children’s novels where there are candyfloss clouds, lollypops for trees, and, of course, the rest of the country is made of Cadbury’s chocolate.

I would like to spend my time talking about two particular parts in this debate on economic development and infrastructure, and one is transportation. I am not going to spend a lot of time on that. There are two parts to that. There is the rail part and the regional roading part. A lot of time has been taken up on that by a number of members in the Chamber because having good roading infrastructure and rail infrastructure is very, very important for New Zealand.

What I am going to spend a bit more time on is talking about the labour market. I think it is really important because we are right in the final stages of putting together our new Health and Safety Reform Bill. There has been a lot of passion, with people coming in and delivering their messages. Some people have serious concerns, and there are a lot of people on tenterhooks, waiting to see the outcome of what the select committee has got through. Of course, we were very close to delivering that last month, and then it was pulled off the table by Cabinet, and now we have got it back for the final stages.

More important, there are a couple of reports that have been written. In fact, one of them I will just touch on now. It is from the Press on 19 June. The headline is “Dangers of mines and quarries were forgotten” and the article talks about mines and quarries. It said: “In the early to mid 1990s, the regulations for these industries were enforced by the Mining Inspection Group (MIG). This was a group of around 10 to 12 mines and quarry inspectors who visited the sites regularly and enforced regulatory safety standards.” I think that is the key here. We all realise that there needs to be some changes with our health and safety reforms. However, to throw the baby out with the bathwater, as this report said previously, is not the right way to go. It is not smart. It is starting from scratch, and I do not think we are actually going to be teeing this off to the level that we need to tee it off to, to make it absolutely pitch perfect.

When we look at the current occupational safety and health legislation, there are three sections that really jump out for me as being front and centre and are the things that I think really need to be considered for the future well-being of our employers. Section 15, “Duties of employers to people who are not employees”, in the Health and Safety in Employment Act says: “Every employer shall take all practicable steps to ensure that no action or inaction of any employee while at work harms any other person.” That comes up in sections 15, 17, and 19 of the current Act.

The reason why I am talking about that specifically is that when we listened to Mr English’s Budget debate speech on 21 May this year, he made a very strong point with regard to his comment: “The Government is also investing $32 million over four years to increase the number of labour inspectors and strengthen enforcement of employment law.” Well, I have to say I thought it was quite an ambitious comment to say that for the next 4 years the Government is going to spend $32 million, because, of course, I think there will be a big surprise if the Government gets through to the next election, in fact—that is, if there is not already going to be a snap by-election.

What that means is that an increase of $8 million a year is going to be spent, which is around about $153,000 a week. If you average that out into an hourly rate, at $100,000 a year, that is going to provide for around about 80 enforcement staff, full time on $100,000 a year, to go and do the job of ensuring that the enforcement of this Act is upheld. Well, goodness me! If this is the delay in getting the support and the funding, I say it is a little bit too late. There has been a lack of costings versus the value of investment into looking after the health and safety of our workers. If this Government had only had the foresight to put in that sort of funding 7 years ago—and let us not take it all and put all the blame on National, but it was Labour as well—and if it had that sort of enforcement and those sorts of officers in place, we would not have the problem that we have got currently with our health and safety situation.

If you have been listening to this estimates debate tonight, you would think that there were parallel universes being described. If you believe this Government, then everything is rosy. We have never had it so good—it is like nirvana. Well, it is like Government members are living in cloud-cuckoo-land. It is like the emperor with no clothes, King Canute, and Pollyanna, with Road Runner running through. They are living in this parallel universe in cloud-cuckoo-land. The real story needs to be told, and the real story is no fairy tale. There are too many people in this country living on Struggle Street. There are too many who are doing it really tough.

This is a Government that is pretending. It is pretending that there is no housing crisis while people cannot find affordable housing, let alone afford to buy. It is trying to sell off State housing while children are getting sick and frail people are getting sick, and some of them are even dying because their State houses are too cold and damp. It is pretending that there are no problems with our economy while dairy prices are plummeting, while our regions are suffering, and while small businesses are struggling and just keeping their heads above water. It is pretending. It is not being straight with the country. It is out of touch. There is mismanagement, there is waste, and there is looking after its mates. “Corporate welfare” has become an everyday phrase in this country, where companies are being bailed out—Skycity, Rio Tinto, Chorus, MediaWorks, Saudi sheep farms, Oravida—with handouts while the everyday Kiwis get overlooked and squeezed. It is a wasteful Government—wasteful and mismanaging. There is enormous waste in spending—$26 million is spent on a flag referendum while our kids are getting sick and sometimes even dying in our State houses.

The real story in our regions is one of neglect. Regional development is built on strong regional infrastructure. We have heard tonight about the mismanagement and the squeeze and neglect that is happening in regional New Zealand in our roading network. In the Clutha District there are 260 bridges and bridge culverts that Clutha District Council is struggling to keep up in order to maintain its road networks. It does not have the money to spend on repairing those bridges and those bridge culverts because there is no money to fix them, because there is no money that has been allocated in the Budget to do that. They were not built for 10-tonne milk trucks. The council is struggling to get even fire engines over many of those bridges. There is a real problem in regional New Zealand with a lot of our roading and with a lot of our bridges.

But the real story is the story of rural broadband, which needs to be told. Some of my colleagues in the Committee tonight have touched on this issue. This is a story of absolute negligence and it is a story that is unfolding. In 2010, $300 million was promised, and a quarter of a million rural households were promised faster internet. Five years later the money has been spent, but who has benefited? Well, it is not the people in rural New Zealand. It is not the small businesses; it is hardly any households. Vodafone and Chorus have benefited, but what about the people? In a study that was done last year in rural New Zealand, 70 percent of small businesses and households surveyed said they felt extremely frustrated, left behind, and like second-class citizens. This is a grave misuse of Government funding—$60 million spent, 8,500 connections to show for it, and millions of dollars being handed to Chorus to upgrade cabinets. There is no accountability on improvement in connections on the copper network or new connections on fibre. Millions of dollars have gone to Vodafone to upgrade—

It is a pleasure to take a quick call in the innovation and economic development part of this estimates debate. The model is not working, and the Government is not being straight with New Zealanders. The housing market is not working, particularly in Auckland, but you would not hear that from the Government. The rural economy is falling in a hole and the Government is neglecting our regions. The numbers speak for themselves. In the last quarter, GDP growth came in at only one-quarter of its forecast level, at less than a quarter of a percent.

Business confidence has gone negative for the first time since the global financial crisis recovery. Our dollar is plummeting like a rock, just about as fast as business confidence—not that we want the economy to be falling in a hole; not that we want the economy to be failing. What is the Government’s reaction to this serious crisis of confidence? Well, it has neglected the regions. New Zealanders are not fooled by spin—glossy publications, glossy Minister Joyce. They want real projects. They want work that will create jobs in each region. They want each region’s strength to be built upon. They do not want shop fronts that are empty, houses that are empty, streets that are empty, and polytechnics that are empty. That is not what they want.

The Government has rushed out initiatives that Treasury told it were not ready. Two weeks ago Minister Joyce put out a regional investment plan that Treasury said was not ready to be funded and that it recommended be deferred. The Minister overrode that. Why? Because he knows, and New Zealanders know, that with dairy payouts starting with a three—as in $3-something, which is a real possibility—too many farms will go close to the wall or to the wall. To bail themselves out, under pressure from their banks, they will take whatever cash they can get from whoever is bidding. You can bet your bottom dollar that a lot of those people will be offshore bidders—

💬 Brett Hudson: Oh, here we go. Give the man a whistle.

No, this is colour-blind, and it is real, and if the backbench members of the Government want to ignore it, they will be in Opposition very shortly. New Zealanders do not want our land sold out from under us. It does not matter whether it is going to Canberra or Cambodia—they do not want that to happen. Meanwhile, the system remains unfixed. Callaghan Innovation, which the Minister gave a few extra dollars to, is still doling out money on automatic grant criteria for its growth grants, which has seen it funding potential fraudsters, foreign-owned multinationals, and polluters who have not had environment consents, and it even funded the Oracle America’s Cup challenge, not Team New Zealand. Can you believe it? What a mess.

Even leaders in the sector, like the Government’s Chief Science Advisor, have panned that Minister’s performance. The Chief Science Advisor says that the system is too reactive, and Professor Hendy from Auckland University is saying that the bias is towards the old economy. We need to be building a new economy, one where we have a reasonably high level of investment in research and development; where we diversify our economy; where we strengthen the smart stuff, not just the farm stuff that comes raw; where we add value to our primary commodities; where we build on our primary sector, just like Denmark does; where we strengthen our manufacturing and services alongside primary agriculture so that we are adding value, information, and smarts; and where we are known worldwide as the highest-quality, most environmentally sustainable, most traceable producer of fine food products anywhere in the world, so that every housewife in Britain, India, or America who wants to buy safe, sound food for their kids knows that when you buy from New Zealand, you buy quality. But we are not there because the Government is racing to the bottom.

The Government does not get it. It thinks that by just reinforcing the old economy and being nice to the foreign-owned banks, it will all come right. Well, Mr Joyce, it is not coming right. It is falling in a hole, and you have only got to go around the regions to have everybody tell you that. [Bell rung] New Zealanders know the truth, and it is not—

Order! Otherwise that becomes another call.