Estimates Debate — Economic Development and Infrastructure Sector

Members, we now come 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 Labour Market, and Vote Transport stand part of the schedules.

Thank you so much for calling me before my learned colleague opposite, David Clark. I am sure that he will make a great contribution. We do actually belong to the same Commerce Committee.

It is a great pleasure to contribute on the Economic Development and Infrastructure Sector, Vote Business, Science and Innovation segment of this debate. The vote itself is $2.2 billion, and we as the select committee undertook hearings with five Ministers of the Crown. The Estimates process is an important part of the proceedings of this House and Parliament, and our democracy, as it gives the members of Parliament an opportunity to hear from Ministers about their vision for the Budget process and what they are going to be doing with the money for their departments. Ministers also undertake questions from the Opposition, obviously—and our Opposition had many questions.

I would like to take this opportunity to thank my colleague Brett Hudson, who actually chaired one of the Commerce Committee meetings when I was away. I would like to recognise his good chairmanship. I hear that he actually did a wonderful job. I would also like to thank the wider committee for making sure that the Commerce Committee actually ran very smoothly, and the secretariat providing the support, which is very valued—it is great assistance that it provides to the committee, as well. I also want to commend the work of the Office of the Auditor-General. I would like to take the opportunity to thank it for the work that it does, because it is actually very important work that it provides to the members. It looks at the votes and how they might actually be utilised, and it gives us some heads-up on some of the grey areas. I think it provides a tremendous service to New Zealand and to members of Parliament.

The Commerce Committee, as I have just stated, heard from a number of key Ministers of the Crown, and I would like to note, for the Committee of the whole House, some of the matters that were actually raised during those hearings.

The Hon Amy Adams, the Minister for Communications, spoke to the committee about a wide-ranging number of initiatives that she is tackling as the needs for better technology across our country continue to grow. As many members will note, technology has grown so fast in the last couple of years that even our elderly community is enjoying the fast speeds of the internet, and is utilising technology to communicate with family across the oceans in countries away from New Zealand, as well. In particular, the Rural Broadband Initiative (RBI) was raised by the Minister, with an emphasis on over 300,000 households in rural areas that are now able to connect to fixed wireless or improved copper services. Minister Adams also noted that 4G capability of the RBI is at speeds of up to 100 megabits per second, and that this is well in excess of the target speed. We often talk about some of the countries that are more advanced in internet speeds, and we can proudly say that New Zealand actually does better than those countries. I am very proud of the work that Minister Adams has been able to provide for this country.

Another key area raised by the honourable Minister was the roll-out of ultra-fast broadband (UFB) to 90 percent of businesses, schools, and health services across targeted parts of New Zealand. The extension of the UFB roll-out is now hoped to extend to up to 80 percent of New Zealanders by 2022, and not just key agencies. This is due to the overwhelming influence that ultra-fast broadband is able to have on the technologically innovative island nation that New Zealand is. As I mentioned, senior members of our community are now utilising technology like mobile phones. Instead of just calling people, they can actually talk to them using technology like Skype and FaceTime. I think that having ultra-fast broadband will make these connections faster and more frequent, and I think people will probably feel the distance a little bit less.

The Hon Paul Goldsmith also spoke to the committee about the key work that he has been achieving to protect New Zealand’s consumers and to help make businesses and New Zealanders smarter in their transactions and financial capability. The Minister outlined a number of key activities that he has been undertaking to support those with rights, through to creative sector study, as well as new initiatives and support, such as the 25.5 percent increase in funding for 2016-17 to assist in the enforcement of general market regulation and better support our fair trade and consumer protection laws. I think that is something that we should congratulate Minister Goldsmith on.

Also, Minister Steven Joyce spoke in the hearing on the economic development appropriations—

Budget 2016 and the Estimates we have examined do nothing to fix the housing crisis in New Zealand. They cut health and education expenditure further in real terms, and they see middle New Zealand—

The CHAIRPERSON (Hon Trevor Mallard): I am just going to interrupt the member right now to make sure that he is aware that we have gone past the housing and health sectors.

Certainly.

The CHAIRPERSON (Hon Trevor Mallard): All right. Well, I suggest that he begins with a reference to the debate that is currently being held, rather than the previous one.

The remainder of my first sentence will directly address the Estimates hearing. Both those cuts and the fact that middle New Zealand gets a smaller slice of the pie show that we have not got an economy that is working for New Zealanders. That is what we examined in our Estimates hearing. We looked at whether this economy is benefiting all New Zealanders.

Mr Joyce told us about his regional economic development initiative. He is putting $11 million per year for the coming years into regional growth programmes. That amounts to a few hundred thousand dollars for each region in New Zealand. That is not going to change the dial on an economy that is failing to deliver for most New Zealanders. Unfortunately, as we began the hearing, Mr Joyce was able to give us absolutely no confidence that his target of 40 percent of GDP being made up of exports would be reached in the foreseeable future. He would give us no commitment to any intermediate targets and described it as an aspirational goal. When Mr Joyce announced that plan originally, he said we would get there. He believed that, year by year, we would see exports grow as a percentage of GDP, but, in fact, we are now down below 30 percent—we are solidly below 30 percent and projected to stay there for some time to come.

Mr Joyce and his Government have failed to grow the economy. What we looked at when we looked at the Estimates were the initiatives of the Government to change that situation. We looked to see whether it would create an education system that would benefit New Zealand in terms of the skills it needs to grow the economy. We looked at whether the Government would make a health system that would make sure every New Zealander was productive. We looked to see whether these regional economic development initiatives would turn the dial locally to make sure that New Zealanders had opportunities to give of their best and grow the New Zealand economy, and we got no reassurance at all. In fact, we know that since National took office the share of the economy going to wage and salary earners has fallen. In real terms, that amounted to a $50 cut for families each week in terms of their income, and Budget forecasts show that that trend is set to continue. Unemployment has grown under this Government. It is higher, and projected to stay higher, than when the Government took office.

In the regional growth plans that we saw—which were going to allocate a few hundred thousand dollars per region and which were not going to grow the economy in a way that was really going to change the picture we have got now of an economy that is driven by immigration, largely, rather than by productivity gains, and in a situation where now $37 out of every $100 that the economy grows goes to wages and the rest goes elsewhere, where it used to be 50 percent—we took no confidence. If we look through regional New Zealand, we will see that everywhere, and across New Zealand, this Government is failing the regions. Let us not forget that if the regions succeed, New Zealand succeeds—60 percent of New Zealanders live in the regions that Mr Joyce’s initiative wants to support. It is just not enough, and there is not the framework there to help change the dial on New Zealand’s earnings. If we want New Zealand to succeed, we need our regions to succeed.

If we look across a series of regions—in the Bay of Plenty, the number of people on benefits has increased by 13 percent under this Government. Transport spending in that region has been cut by 40 percent—$86 million in real terms. Against that, the few hundred thousand in that Budget is nothing. That few hundred thousand is not going to make up for $86 million in under-investment in infrastructure. In Gisborne, the unemployment rate is the highest equal in the country, at 8.4 percent—18 percent of working-age people in Gisborne are on benefits, the highest level in the country. There, again, transport spending was cut $22 million—a few hundred thousand on that regional development initiative will make very little difference indeed. Gisborne also has the lowest homeownership rate in the country, and police statistics are going off the chart. This undermines confidence and undermines that growth in the regional economy.

Likewise, in the Hawke’s Bay, it is a very similar story. In the Manawatū, under National, joblessness doubled while incomes have fallen to the lowest in the country—again, the economy is not working for those people in the regions. These initiatives, this few hundred thousand dollars will not make a difference when, in that region, they get just $492 of transport funding per person compared with a national average of $700. Those are New Zealand Transport Agency figures, which the Minister can look up if he cares to.

National has underfunded services in the top of the South Island, too. We see there burglaries on the increase, we see net jobs down by 200 in the past year, and we see cuts to the district health board that supports the workforce. There, again, we see police statistics: burglaries up 49 percent; police assaults—assaults recorded by the police—are up 44 percent in the past year alone. The economy is not working for the regions.

National has underfunded these things in Northland as well, and there the economy has shrunk by 1.8 percent in the March quarter alone. Northland’s unemployment rate of 8.4 percent is, again, the equal highest in the country. That region has lost a net 100 jobs in the past year, and the median household income has fallen by $37 a week. This initiative that the Government is promoting to grow the regions is not going to change the dial on that. I am interested to hear the Minister speak further on it, because he failed to convince in the Estimates hearing on that.

In my home town of Otago the number of jobs across the region fell by 2,500 in the past year. Household incomes fell by $98 a week, according to the New Zealand Income Survey, and National has cut over $100 million from the district health board over that period. If you fail to invest in infrastructure in the regions, you cannot expect a few hundred thousand here and there to make a difference, Mr Joyce. National has failed.

Of course, the Southland economy, as well, as we know, has shrunk by 10 percent in the past year—10 percent—and the average household income in Southland fell by $49 a week in the past year. Unemployment has more than doubled in Southland—more than doubled—since 2008, when the National Government came into office. Of course, the cuts to health have impacted there too.

Taranaki is in a recession. Its economy shrank by 3.3 percent in 2015, and it has already shrunk a further 1.8 percent in the first quarter of this year. They lost 700 jobs in Taranaki last year. The Minister smiles, but these figures are hurting people in the regions. They are hurting people in the regions, and the failure to invest—this few hundred thousand dollars that the Minister has trumpeted in his Budget, in his regional development programme—is not going to change the dial in the Taranaki, and nor will it in the Waikato. There, we have another situation where the economy has shrunk by 2.2 percent in the last year and by a further 0.3 percent in the first quarter of this year. These are the Minister’s own statistics, through Statistics New Zealand. Of course, the loss of 900 jobs in the Waikato region in the past year is not lost on the locals, either.

Wairarapa, West Coast—I could go on. These places desperately need regional development programmes. The Estimates ought to be the place where we look to see the investment of the Government in those regions, recognising that if the regions do not succeed, New Zealand will not succeed. We cannot afford a two-speed economy in this country.

We need a Government with vision, not a Government that has been in office for 8 years and is content to see wages decline in real terms in these regions—not a Government that is out of ideas, out of touch, and increasingly described as arrogant by the people whom I talk to. We need a Labour Government with an aspiration for the future, backing the Kiwi Dream, addressing the housing crisis, investing in the regions, and making sure that real New Zealand—that middle New Zealand—is benefiting from any gains in the economy that are over and above an economy driven purely by immigration.

The member David Clark needs to get out more. A daisy chain of slogans does not actually make a speech, but never mind. I could suggest that he go, for example, to Hawke’s Bay. He mentioned Hawke’s Bay. But, actually, a couple of weeks ago in Hawke’s Bay we launched the regional growth programme for Hawke’s Bay, which has been put together by the local businesses, the community, the iwi, and central government agencies with the people of Hawke’s Bay. It has been exceptionally well received—

💬 Hon Todd McClay: Praised by Mr Nash.

—by Hawke’s Bay people—and praised by all the local MPs, actually: Mr Foss; Mr Nash, dare I say it; and others—although Mr Nash is in hot water at the moment, so we probably should not share that with the group.

The CHAIRPERSON (Hon Trevor Mallard): Order!

This programme is doing a huge amount for Hawke’s Bay. What it is—and I think the member misses this; he also missed it at the select committee—is the collection of a whole lot of Government activity, focusing it on the growth of individual regions.

So, for example, we announced $25 million for the port access to the Hawke’s Bay, between the expressway and Napier port. Napier port is growing very strongly. We announced working with Napier City Council on the expansion of the National Aquarium. We announced a programme that I am very excited about, which is Project 1000, because you have a horticultural sector in Hawke’s Bay that is growing dramatically. It is planting thousands of new apple trees. It has also got the wine sector, which is growing very strongly. So we got together and said that we can do a project that would bring 1,000 people from being on a benefit or otherwise unemployed in the region into work—full-time work—over the next 3 years. We have got the employers, we have got the iwi, we have got the Ministry of Social Development, and we have got the Eastern Institute of Technology all working together to achieve this goal. That is the real on-the-ground work that gets stuff done, not running around parroting slogans in Wellington and trying to sound interesting.

And it is not just Hawke’s Bay—a couple of days later I was in Northland with Minister Guy. The Ministry for Primary Industries (MPI) has got a great programme up there, working with farmers to improve the productivity of their farms and obtain more income. It is a fantastic project. We went and saw a farm that is doing exactly that. It has got a whole mentor programme around the region and demonstration farms being put together—a tremendous programme. We also have the Queenstown Resort College up there—yes, that is right, QRC—working with the people of Te Tai Tokerau to train young students out of school for the tourism industry, for the first time. That is real activity in that region. We also have the Northland College mānuka plantation, which is being done by Northland College with MPI and with some unemployed people who have come into work to plant that plantation so that we can train young apiarists for the growing mānuka industry up north.

Then, of course, you have the opportunities in further horticulture in the far north. Plant and Food Research in Kerikeri showed Minister Guy and me the work that it is doing in that space. Then, of course, you have international investment—which I appreciate that the Opposition has a sort of fairly plus and minus view on. But we have Shanghai CRED Real Estate, which has come and bought the Carrington Resort and wants to put in 800 rooms. We have got 40 rooms now and it wants to increase that to 800 rooms and hire lots of locals, and we are encouraging that sort of investment.

But it is not just about Northland or Hawke’s Bay. If you go to the Bay of Plenty—a few weeks ago I had the privilege of being part of the Bay of Connections people, who are there working on their regional growth strategy, again with the support of central government agencies and central government money. I note that the member said: “Oh, you know, the Bay of Plenty doesn’t get any money.” He obviously has not been there, because if he had he would know of a project called the Tauranga Eastern Link, which is the biggest single investment in infrastructure in that region, ever—it is only about half a billion dollars, but he has already forgotten about that. Also, of course, you have got the broadband investment that is going on.

Then you can go farther, to Manawatū-Whanganui. That is a really important region, as well, and later this week we will be launching the Manawatū-Whanganui regional growth study, put together by the region with the support of central government—by businesses, by iwi, by everybody working together to make things happen. I am prepared to bet money that, actually, most of the MPs, if not all, will be supportive of that, because they see it working in their region. So the member can sit quietly in Wellington—

Tēnā koe, Mr Chair. Tēnā koutou e Te Whare. I rise to speak about infrastructure. After the historic Paris Agreement, which occurred in Paris at the end of last year, I attended an OECD conference on green growth. The keynote speaker there raised a really important issue, which is that the outcome of this historic Paris climate agreement is that all of the countries in the world agreed that we have to do something to limit dangerous climate change and, in order to do that, we have to reduce carbon pollution and other greenhouse gas pollution.

What the keynote speaker at the OECD conference I attended said was that he and his colleagues at Oxford University had crunched the numbers on what would be necessary to achieve the limits to pollution that were agreed to, so that we could get to that agreed limit to global warming in time. In order to do that, basically every piece of new infrastructure we invest in from next year—that is, 2017—has to be carbon-zero. That means that we cannot continue the status quo of increasing carbon pollution or emitting it further at a lower rate. This is a reality that this National Government has completely failed to engage with. There is nothing in Budget 2016, in transport infrastructure in particular, that is going to enable us to achieve this goal. In fact, it is quite the opposite. We are continuing the same pattern of increasing spending on road transport, as opposed to offering the complements to the road network, which are what is needed in New Zealand to reduce carbon pollution and to get better economic outcomes.

Here is this incredible opportunity, an opportunity to get better outcomes for the climate and for the economy, and yet this National Government is completely neglecting it. Why would it do such a thing? The only reason I can think of is that this group of people who are currently in the National Party, particularly the most influential power brokers, are just very wedded to the status quo, out of touch with reality, and backward-looking. That is the only explanation that I can see, except for, of course, where the current Minister of Transport, Simon Bridges, appeals to an as yet completely unproven technology that will somehow save us, like driverless buses.

In this Budget, in the Estimates—it is quite clear—92 percent of the transport budget is on roads. When we raise questions about that, the answer we get back from this National Government is that if you think that less than 92 percent in the budget should be spent on roads, you are completely against roads. I have news for them—92 percent is nearly 100 percent. You could still spend a considerable amount of the budget on roads and spend two times, three times, four times, five times as much on the complements to the roading network, like the rail network, like passenger transport, like more coastal shipping for freight. That way we get better outcomes for those people and goods that are able to use that new infrastructure to move around and we take the pressure off the existing road network. It is not rocket science. It is not that difficult.

The Green Party is here to actively campaign on clean, fast, modern transport that will make it easier to get where people need to go. In fact, this type of balanced transport investment is far more cost-effective than what the current National Government is doing. So here is an example. We recently launched our campaign for rail for the North Shore. It is very popular. The vast majority of Aucklanders support it. In fact, a tiny minority would support the Government’s proposal of a road-only crossing. It makes sense because it will move three times more people than the road-only option while costing $1.5 billion less. I am not even including the enormous cost on the existing road network of dumping an additional 20,000 cars on it or needing to find parking somewhere in the city centre for 20,000 cars.

If we had a rational approach to transport planning and funding, one that did not limit itself to considering new highway expansions, and had instead asked “What is the most cost-effective way to move the next bit of people and goods and how can we do that in a way that meets our agreement in Paris and reduces carbon pollution?”, we would come up with some fantastic answers. They are all right there in the Green Party’s positive plan, which will be better for the economy, better for people, better for cities, and better for the climate.

Thank you very much for this opportunity. Nau mai, hoki mai e Te Whare. Welcome back. It has been a bit of a long break and we are back into the swing of things.

I have heard many times today people talking about this amazing broadband roll-out, this investment into infrastructure that sees the internet become more and more accessible. Well, a recent report has Māori access to internet still at around only 64 percent. In fact, it is the lowest in the country, and we argue that most of those Māori are actually in the city, believe it or not. We do say that there is a significant lack of development for broadband usage and infrastructure in the regions, but I would argue that in Tāmaki-makau-rau, in fact, much of the Māori population is a transient population. That is a population that cannot afford to get on to the network, let alone access it. You will find them down at McDonald’s accessing the free Wi-Fi. So 64 percent—is this the kind of progressive economy that we want and that the Māori people are looking for to engage in an economy that will provide sustenance, provide sustainability, for them and their families?

I want to turn right now to He Kai Kei Aku Ringa. He Kai Kei Aku Ringa is the Māori economic development strategy. I am going to argue that despite seeing trade delegations go overseas, despite seeing all of this rhetoric around iwi settlements, I can tell you that the Māori people in the regions are not benefiting. Certain people are. Fat cats are. There are people eating at the trough, but I can tell you this: the majority of the Māori population are not benefiting—they are not benefiting. We know that the settings in the National economy are broken, because they are not filtering out to the regions. They really are not.

So what is the answer from this Government? “In Northland, I tell you what, we will settle with Ngāpuhi and that will fix the entire economic issue in Te Tai Tokerau, in Northland.” Well, I do not think that that is responsible economic management, nor do I think it is sustainable, nor do I think it is something that will engage the entire region; it will just put the onus on Māori to lift the regions out of the doldrums, because that is what its plan is. That is what the plan is. Let us utilise all of these settlements. Let us utilise He Kai Kei Aku Ringa. We will pull in a few of the Māori leaders and we will tell the Māori people that the economy is booming for them and when they are ready they can come and plug into it. They can receive the benefits from this growing economy—He Kai Kei Aku Ringa. More than five trade delegations offshore—that is fantastic. The culture is being seen in China, Asia, all over the show. What has come back to the beneficiaries here in New Zealand Aotearoa? Nothing—nothing. I argue that it is absolutely nothing. So what is the plan? Like I said—oh, well, we will give the iwi more settlements and expect them to do the job that we are failing to do. I have spoken about the He Kai Kei Aku Ringa strategy.

Why is it, then, that Māori unemployment still remains above 12 percent—above 12 percent? We also know too that the majority of the Māori population are young people, rangatahi. So approximately 80,000 young people are not engaged in employment, education, or training. This tells me that the settings are broken. This economic plan, this great hope for this country, is not working. It is not working for the people in the regions. It is definitely not working for Māori—that is for sure. I have already mentioned the unemployment statistics. Let us not talk about the poor housing-ownership rates. Let us not talk about the low wages. Māori and Pacific Island people in Tāmaki-makau-rau are filling a lot of those low-skilled jobs.

What does this Government do? It has no plan to raise the wages—none whatsoever. We talk about poverty. All of the issues that we have just discussed and debated around housing come back to this: a really poor economic plan. We need one that will provide a vision for Aotearoa New Zealand, one that will see us all prosper; not just the people at the top but everybody—Māori, Pākehā, in the regions, in the cities. That is the challenge in front of this country, and this Government is failing to meet that challenge. It is failing to come up with a clear plan for prosperity.

Well, the member who has just resumed his seat, Peeni Henare, obviously did not listen to my last contribution, when we went through some of the things that were happening in Northland as part of the Northland regional growth strategy. And yes, I think that it would be great to get the Ngāpuhi settlement over the line in Northland, but the suggestion by the member that that is the only thing that will have an impact in Northland is wrong.

Actually, there are 50 or 60 initiatives, and I would recommend that he do the people of Northland the honour of actually reading the regional growth strategy that they put together rather than bagging it and saying that there is no plan, because all of these regional growth strategies were put together by the relevant regions, not by Government agencies or Ministers. So every time the member turns up and says that there is no plan, he is basically going to each region and saying: “I don’t like your plan.” The member can say that if he wishes, but I do not know that that will be a particularly mana-enhancing experience in each of those regions.

He also mentions the need for employment in parts of South Auckland. I happen to agree with him. The great thing is that there are huge opportunities in that part of Auckland, and it is about matching the young people to the jobs. I want to tell him about an initiative called Ara, at Auckland Airport, which is a skills exchange, modelled on one in Australia, that has been developed for New Zealand. We have 39 companies working at this site out at Auckland Airport. They are training people. We have got apprenticeship coordinators. We have got the Ministry of Social Development there matching people into jobs. We have got a whole bunch of training for drivers’ licences so that people who need to get to and from the airport to work can actually get their driver’s licence quickly in order to do so. The whole idea of that is to help put the people into the jobs, of which there are something like 20,000 more over the next 10 years in that part of Auckland alone. So it is all about working collaboratively and locally.

I wanted to note a very important part of the Estimates, which is the Innovative New Zealand package: $761 million over 4 years to invest in innovation. I note particularly the biggest investment ever over 4 years in science: $114 million for the Ministry of Business, Innovation and Employment Endeavour Fund, which is the contestable, mission-led fund that is all about funding the sorts of sciences that solve issues like water quality, climate change, gas emissions, and all those things. For discovery research—for the bright scientists who start out and have ideas they need to follow, which so many New Zealand scientists have been successful in doing—there is a big investment. There is a big investment in what we call the Strategic Science Investment Fund. Health research is another one, and there is investment in start-up companies as well.

💬 Hon David Cunliffe: Smoke and mirrors.

So there is a huge amount of investment, which Mr Cunliffe, who holds his calculator up the wrong way, is misunderstanding. There is also a big investment in tertiary education. The good news is that that is really working. We are seeing big growth in the sorts of skills that we need for a modern, innovative economy. We are seeing big increases—40-odd percent—in the number of engineers being trained at university, and increases at the polytech level. We are seeing big increases in the number of ICT students who are being trained in software engineering at our universities—an increase of about a third over 7 years.

We are seeing increases in the trades. BCITO in the last couple of weeks came out and said it had passed a milestone it had never reached before: 10,000 apprentices in the building trades—10,000. It has never had that number before, and that is a tribute to the hard work of that sector. We have more people working in construction than we ever had before. We are training around 38,000 more for that sector, and that is where the rubber really meets the road. That is where you have to sort of get away from the slogans and talk about what is actually going on and the work that is being done.

Regional New Zealand and those industries that need these workers know that the work is being done. I met a senior construction executive—one of the most senior in the country—the other day, and he said: “Look, that stuff the Government’s doing in tertiary education for engineering and for the building trades and so on is fantastic.” We have never had the level of response by the tertiary sector that we have had this time around in the construction boom that we are in today, which is the biggest that this particular gentleman has seen in 40 years. That is doing the work for economic growth.

It is no surprise that New Zealanders are feeling increasingly uneasy about the way this Government is running our immigration system. It is not just something that has appeared to New Zealanders out of thin air. Of course, we have already had Treasury tell us that the Government is running the immigration system inappropriately. We have had Immigration New Zealand itself tell us that the Government is getting it wrong on immigration. We have had the Reserve Bank warn that the way the Government is running its immigration system is causing problems in the housing market in Auckland. A number of Government departments have said that immigration is being run incorrectly, improperly, and not in the best interests of New Zealand—and New Zealanders are feeling it.

If any member opposite thinks I am wrong, watch the 6 o’clock news tonight. New Zealanders know that what an immigration system should be about is bringing in the skills and experience that this country needs to grow our economy and to grow our society. But what are the main jobs that this Government is using the immigration system to bring people in for? The main jobs are for dairy farm workers. In New Zealand, of all places, this Government has prioritised bringing people in from overseas to work on dairy farms. It is bringing in retail managers, cafe managers, and retail supervisors. I ask members opposite, (1) do they seriously think that those are the jobs that are going to grow our economy and to provide good wages and good living for people in New Zealand, and (2) do they seriously think that we cannot train people here in New Zealand to take on those roles? Of course we can. But what the Government is doing is using the immigration system to subsidise employers who are not prepared to pay decent wages and provide decent conditions so that New Zealanders will want to train and get into those jobs.

That is what Immigration New Zealand and Treasury have been saying to this Government—that there is an increasing focus on using the immigration system to bring people in with low skills to do low-wage jobs, and they are pushing New Zealanders out of those jobs, which are the first rung on the ladder. Do not just take my word for it. The chief executive officer of the Auckland Chamber of Commerce, that well-known lefty Michael Barnett, came out today and said that he is concerned that there is a disconnection between the immigration system and the skill shortages that we have in New Zealand. He says the roles that we should be encouraging people to come to New Zealand to fill are in construction, in engineering, in electronics, and in ICT. Instead, what has this Government focused on? Retail, cafes, and working on dairy farms.

That is where this Government sees the need for immigration, at a time when we have over 80,000 young people not in education, training, or skills development—or work, for that matter. At a time when 80,000 young people are not working and they are not training and they are not in education, we are bringing people in from overseas who will do those jobs in poor conditions and at poor pay rates rather than encouraging employers in New Zealand to actually invest in their own industries and to invest in New Zealanders.

Of course, we know that immigration is one of the factors contributing to the housing crisis that this Government will not face up to. I would say to that that migrants are voting with their feet. Migrants are settling in Auckland because this Government has stifled growth in the regions. Migrants do not want to move to the regions because they do not see opportunities there, and that is one of the reasons that there is so much pressure on the Auckland housing market—because migrants are voting with their feet. They know this Government has failed on regional development, and so they see their only opportunities as being in Auckland and Christchurch, even though I have to say, as a regional MP, we would welcome more people coming to our region, seeing opportunities in our region, starting businesses, and taking up jobs in those high-skill areas that are going to support regional economic development. But that is not where this Government’s focus is. This Government’s focus is on providing a large pool of people to take up low-skill, low-wage jobs and to suppress wages for ordinary working Kiwis. That is what it is using the immigration system for.

We should aspire to much better things than that. Yes, immigration is important to New Zealand. Yes, we are a nation founded on immigration, and immigration is an important tool and can be a very successful tool for economic growth, but not the way this Government is running it.

I am very pleased to stand to speak on the particular area of transport under this debate, which is touching on appropriations that come to the Commerce Committee and to the Transport and Industrial Relations Committee.

The infrastructure in our country is absolutely critical if we want to see the sustained, continuous economic growth that we are seeing right now carry on for years to come. One of the commitments that this Government has made is to ensure that we have a transport infrastructure that is indeed going to fuel that economic growth, particularly in the regions. We know that there has been a huge investment in the Waikato Expressway. That affects regions such as the Hawke’s Bay, such as Taranaki, and such as King Country, because when our exporters take their products to ports they travel down those roads of national significance. Those roads that are outside of our region are our regional roads to our export ports.

I want to just acknowledge the Minister of Transport, the Hon Simon Bridges, and the former Minister of Transport, the Hon Steven Joyce, and the commitment that these Ministers have made over the years to ensure that we have a state-of-the-art, modern transport infrastructure.

We often hear the comparison made between road transport and rail transport, and we have at times competition between those two modes of transport. However, the Road Transport Association, in assessing the freight demand and the freight load it carries, says that there is a very small percentage of freight that is competitive between road and rail—something like less than 5 percent—and that these modes are actually more and more complementary, because we know that there are freight loads that rail can carry very efficiently, but there are also services that it cannot provide efficiently, such as door-to-door delivery, which is needed and is where the Road Transport Association and that sector are very, very efficient.

We are seeing a continuous investment by this Government in the transport portfolio. This year we have seen an increase of 4.13 percent and in the 2016-17 year an investment of $4.265 billion of not just taxpayer funding but funding that comes through road-user charges. A huge proportion of that comes through tax revenue collected by the Crown—something like $3.4 billion. One of the, I think, great initiatives that the Minister of Transport is leading is this whole area around electric vehicles. What we are aiming to see, and what the Minister is leading, is a doubling of electric vehicles in our country by 2021, up to 64,000 at that point in time. This is going to be important because it is the way of the future.

There are multiple different fuel sources for vehicles. Here in New Zealand we have the ability to have the most sustainable supply of clean energy to vehicles—more than just about any country in the world. Eighty percent of the energy utilised in running an electric vehicle and building it and also running it comes from renewable sources, whereas in other parts of the world that figure is only 60 percent. And why is that? It is because our electricity is generated by wind, by water, and by sunlight, whereas in many other countries in the world electricity is generated through thermal, oil, and coal. So we have the great opportunity to have an electric vehicle fleet that has the highest level of sustainable energy supply to it of just about any nation in the world. We look forward to seeing this increase. As of 29 February this year we had 1,057 light electric vehicles in the country. So lifting that to 64,000 by 2021 is an ambitious goal, and just getting these vehicles into the market is going to be very important to see the uptake of that. So the Minister, of course, has announced many initiatives around that, and we look forward to seeing that continue in the future.

One of the strategies that we as the Transport and Industrial Relations Committee saw was the regional State highways, and we see an accelerated regional roading programme being delivered.

Thank you for the opportunity to speak in this appropriations debate. I am grateful that the Minister for Tertiary Education, Skills and Employment was here to stand up and contribute to several facets that were brought up by my colleagues on this side of the Chamber—and yet again there was a kind of a manipulation of the facts. I would not dare to say that he is incorrect or that he is completely misrepresenting, but it is about choosing to put forth this, and then obfuscate with this bit or knowledge or this bit of fact over here. It paints an incomplete picture for the public of New Zealand. They are being sold a line—that is basically what I am telling New Zealanders today.

The Minister talked about, for example, his regional development plans and how successful they will be in the regions. Well, little does he know that as those plans came out I actually followed him around and went into those regions to ask the people on the ground what they thought of the regional development plans. I just wanted some honest feedback, because if it is an opportunity for this country to jump on board with, then New Zealand First would like to be a part of that. We want to see our regions grow—and the public of New Zealand knows that absolutely. So if there is a good idea out there, we want to be part of supporting it. Unfortunately, the reality was, apart from some of the economic development agencies—and only some of them—the message was pretty grim.

I then went and spoke with private individuals or privately funded groups whose mandate is to grow economic activity in those regions, and really the feedback was that the Minister and his team there have created, basically, a missed opportunity. The research and the data that went in to inform these plans were lacking, to say the least, and took headline options that had already been discussed at the ground level and put them in these plans and said how wonderful they were. Never mind that the people on the ground in those regions had already examined them, looked at them, and dismissed them as a waste of time, resources, and energy. This is what the Minister presented to the people of New Zealand in the regions and said: “We’re looking after you, we’re going to help you.” The reality is that the feedback was that it was an opportunity for this National Government to create a marketing campaign on regional development and to maintain a spin around claiming it is doing something.

I think some of the members next to me over here on this side of the Chamber have spoken eloquently about unemployment numbers, the decrease in regional growth numbers—it is happening across the country. I would highlight that there are some positive numbers out there; it is great to see. But I put it to you that those positive numbers are despite this Government—this Government, which is not doing anything and is missing the point completely.

I just came from the top of the South Island—a great little part of the country—and I spoke to businessmen there. Basically, they said this Government would not know how to invest or create good infrastructure for actual and meaningful growth if it fell over it. They spoke about New Zealand First’s concern about how this Government is using immigration to simply top up the numbers—in the short term. Research tells us that immigration in the long term will not contribute to the growth of an economy. So in the short term it is masking the reality of this country’s economic growth, in that, basically, we are not growing—and everything that this Minister and this Government are attempting to do is more about placating the masses and selling a story. It is not achieving anything that is tangible or measurable in our regions. It is completely, completely unacceptable.

Minister Joyce accused someone on this side of misrepresenting the facts about this appropriation bill. Actually, what I would say to the Minister is the terminology used around the Budget this year has been incredible. It has been impressive—the name changes for research funds and other pools of money that have been moved from here to there to make it look like things are happening. We were sold a headline number on infrastructure of $761 million. What a figure to grow the infrastructure of the New Zealand economy—that would be amazing. The reality is, actually, just over half of that was in applied research and academic research, which we should be funding anyway out of those pools.

It is great to take a call. Was that not a pessimistic speech that we just heard? I do not blame the member, Fletcher Tabuteau, but, you know, there are so many good things going on in science and innovation and infrastructure. In terms of the things that we are talking about here, there is so much to be excited about—

💬 Hon David Cunliffe: Yeah, just keep messaging until reality bites you.

—in this great little country of New Zealand that it makes you want to shave your beard off, Mr Cunliffe. So, Mr Cunliffe, I am really excited that we are part of a Government and that I am part of a Government of infrastructure. When you think about it, people do not take infrastructure for granted when it is going well, as it is in New Zealand, and we are a party of infrastructure that is making a really significant difference.

I am, of course, the energy Minister, and when you think about energy and the issues on which all of the international experts judge a country—whether it is competition, reliability, sustainability—we have a remarkable success story in New Zealand. On competition, it has never been more competitive than we see today. We have the companies fighting it out hammer and tong in electricity—offerings of $250, and sometimes more than that, for switch-overs. They are the kinds of incentives we have never seen before and, for the first time, actually—since 2001, I think it might have been—the power prices went down. I am really proud of that. I think it is because we set up an electricity authority that has got in, has taken competition seriously—What’s My Number is one that many will be aware of, and there are many other initiatives making a real difference here.

💬 Reliability: the reliability of the supply—when Mr Cunliffe was in Government, every couple of years there was a blackout, a brownout, or a serious threat of that. I was still at school, that is true, but there were blackouts, brownouts, and threats of them, and rationing, every couple of years. There has not been one since this party has been in Government. The reason for that is we have got the incentives in place, we have got the competition in place, and we have fixed the system. New Zealanders can be really proud of that.

Of course we still do have issues, and they are not man-made or human-made, if you like; they are God-made. We look at what is happening around Taupō right now and so on, where the power is out, and Unison—I want to thank the people involved in that—is working really hard in the snow and in quite difficult weather conditions to get it back on. But, in terms of the things we can control, it has never been more reliable in New Zealand.

💬 Sustainability: when we came into Government—this is the bit the Greens hate to hear—65 percent of our electricity came from renewables; today it is well over 80 percent. That has been because, again, the market incentives have got things right. We are a party that recognises the fantastic renewable advantage that this country has, and we are playing to our strengths. We see solar rates going up exponentially in New Zealand, despite the scaremongering campaigns we see from the likes of the Greens and Greenpeace. Under the model that we have at the moment, we see batteries starting to be taken up. It has been great to be involved in a number of launches around batteries, both in the actual commercial grid down to the great lines company Alpine Energy in the South Island, looking at the biggest—

💬 Hon David Cunliffe: Where in the South Island?

—grid-scale battery—Timaru; I think the member was born there, was he not—in the southern hemisphere, I think, through to the kinds of home-style ones we see Tesla doing with Vector.

Electric vehicles: we have heard a bit about them, but the numbers, again, are growing exponentially, so that we are well on the way to meeting this year’s target. They will keep going up and up, and I am looking forward to having more announcements later this year in relation to electric vehicles, as we roll out that strong package, which is making a difference in that area. In transport, again, it is a story that is stronger than perhaps it has ever been. We are investing in the right areas, but in all areas in fact in the transport area.

💬 Hon David Cunliffe: Have you been to Auckland lately?

I will get to that. We are investing more than ever before—$14 billion of investment over a 3-year period. Mr Cunliffe mentions Auckland. We are investing over a billion dollars a year in Auckland. That is more than was spent 10 to 15 years ago, in the early 2000s, across the entire country. Whereas the projects when Mr Cunliffe was in Government were $100 million or $200 million, right at the moment we have the western ring route nearing completion—

💬 Hon David Cunliffe: With no bus lane. Where is the bus lane?

—the biggest transport project ever in New Zealand. Auckland Manukau Eastern Transport Initiative is working through it, with a fantastic bussing network, Mr Cunliffe. The East-West Link, which the Greens oppose, is a critical project to the biggest industrial hub in New Zealand—from $1.25 to $1.85 billion. It is going to be a game-changer out there. The City Rail Link—the biggest, most complex project ever—has started, and the Government is ensuring it is a success. Pūhoi to Warkworth—the point is this: there are multiple multibillion-dollar projects that are making this country move.

It is not only roading. A critique that we get from the lot over the other side is that that is all there is. Actually, in rail we have invested, under this Government, $4.2 billion, and that is making a significant difference. I actually think in terms of KiwiRail that although it is a business that is subsidised, it has got a bright future. Rail has a bright future as a result of what we are doing right now. Regarding passengers—because members over the other side mentioned this—we have seen metropolitan passengers go from 2.5 million in the early 2000s to over 16 million. Those numbers will only increase as we invest more in the networks in places like Auckland and Wellington. In freighting: it was great earlier last week to be in Masterton, where KiwiRail—and we are seeing a lot of this around the country, with CentrePort, in this case—just out of Masterton, has a logging hub. The logging is coming together up on to those trains and going through to the port.

We are seeing bigger ships—we are seeing later this year the biggest freighting ships we will have ever seen in New Zealand come into Tauranga—as other ports also deepen their harbours, as we see that more intensified freight, and as we see these inland hubs, again, where the freight is coming in. Rail, if it plays to its strengths, has a strong future. We will always need the trucks, because they are important in getting those local goods around, and for a number of the jobs that trains cannot do. We have a truly integrated system, and we have the New Zealand Transport Agency, with KiwiRail, working really hard on that.

Of course there are many more areas that are receiving unprecedented investment under this Government. In public transport: there is $2 billion going into that. It is not a financial issue, but I have been really proud of some simple changes that we made to allow for the heavier buses. Now in Auckland, as a result of those changes that Craig Foss and I made, there are double-deckers all over Auckland. When I am seeing them they are full with passengers getting around that city, and that is a great change that is being made.

💬 Hon David Cunliffe: It’s because they can’t drive on the roads because of the gridlock, you nana.

Cycleways—“you nana”.

💬 Hon David Cunliffe: You nana—it’s the technical term.

The level of debate in this Chamber: “you nana”.

Cycleways—you cannot travel by nanas, Mr Cunliffe.

💬 Hon David Cunliffe: Aucklanders will try anything because they can’t use their cars. They’d go faster on a banana.

There is $333 million, a real step change in funding, so that we are seeing urban cycleways pop up—not like bananas, Mr Cunliffe—in every urban centre with over 30,000 people, with the exception of Invercargill. They are making a significant difference in terms of safety, in terms of environment, and in terms of health benefits. It was a great pleasure—not in my electorate, but in the electorate of Todd Muller, actually—to see a $7 million or $8 million cycleway from Ōmokoroa into Tauranga. It is going to be a stunning success from a health perspective, environmental perspective, safety perspective, and commuting perspective, but also from a tourism perspective, so I am really proud of that. What a difference in infrastructure this Government is making for New Zealand.

Kia ora, Mr Chair. Ngā mihi nui ki a koutou, kia ora. It is great to see all the members back after a 4-week adjournment. I want to take this opportunity to wish our Olympians the best of luck for Rio.

If anyone is watching the parliamentary broadcast and not watching the Olympics right now, they would see some pretty pure political athletes on that side of the Chamber. They would see some gold medal candidates when it comes to pole-vaulting over facts, in terms of political spin and mental gymnastics. I have just been spun out by all the political spin I have heard from the Government benches tonight, because there has just been so much bunkum that we have heard. We heard Steven Joyce stand up and say: “Well, you know, I’ve been doing an innovation Budget.” You cannot call it an innovation Budget when you are seeing real-term cuts to tertiary education, and when the investment is not even pushing the needle on our woeful research and development statistics, which see us in the bottom half—half the developed-world average—when it comes to research and development spending.

We saw Jonathan Young angling for a medal for the fact that we are 80 percent renewable. We have less renewable electricity in New Zealand than we had in 1980, than we had in 1990. This Government does not deserve a medal to say: “We’re 80 percent, and aren’t we doing well.”

Then Simon Bridges got up, and Simon Bridges was trying to trumpet that for one measure for 1 year over 25 years, prices for one component went back—never mind line charges and all the other fees that keep going up. For one measure, one component over 1 year after 25 years, we saw the generation component of electricity bills decline. He was trumpeting that as a great success. There was a quote a former energy Minister told me, and I think it is quite applicable to the energy portfolio. He said that no one has ever made their reputation as the energy Minister, but plenty have lost it having that portfolio. I think Minister Bridges has taken that to heart, because what we see—ironically, it is called the energy portfolio—is someone with no energy whatsoever, who has taken an approach to talk a big game and do absolutely nothing. He is absolutely risk-averse and he is refusing to look at the global trends. When it comes to electric cars, allowing them to drive in busways is not going to cut it.

This is a Minister who has continued the tens of millions of dollars of tax breaks and subsidies for last century’s fossil-fuelled, polluting oil industry. This is the Minister who sat on his hands when Huntly went back to burning more 19th century coal. Ironically, this is the Associate Minister for Climate Change Issues but he seems to have all the portfolios where it comes to increasing emissions, be it fracking, subsidising oil drilling, seeing more coal burnt in Huntly, more motorways, more trucks, or closing down regional rail lines. We saw a Minister who was quite prepared to see the Energy Efficiency and Conservation Authority use taxpayer funding to slam solar energy in a recent report, a Minister who is standing by and refusing to act when the electricity industry, to protect its profits, is trying to discourage customers—and it is customers in regions like the Hawke’s Bay, Taupō, and Rotorua who are facing these arbitrary, unfair, discriminatory new solar charges. This is the Minister who has seen power bills go up and up, more than the rate of inflation, and has seen people scared when they see their power bill when they go to their letterbox, because they know it is going to go up and up.

A single component of a single measure of a single year over 25 years is cold comfort for those customers. Talking about cold comfort, this is the Minister who has seen the smallest amount for energy insulation in years and years and years. This is a Minister who asked for more at Cabinet but delivered the lowest amount of insulation funding we have seen for years and years. This is despite the fact that we see 15 New Zealand kids dying and 42,000 kids hospitalised every year as a result of our cold, damp housing in New Zealand. Yet this Minister spends his money on providing tax breaks for the oil industry. What we see is a Minister missing in action, someone with no vision, no leadership. He is not acting, and it is a tragedy because we have got such tremendous opportunities.

There are four times more jobs when it comes to clean energy than in fossil fuels. We do have a good energy story to tell. Once upon a time we were leaders and pioneers. We should be the ones selling those solutions—the intellectual property, the software—around the world because, currently, unlike New Zealand, more people are investing in clean energy than fossil fuels. We are missing the opportunities because our Minister is missing in action.

New Zealanders face a stark choice. They have a choice between a Labour-led Government that will manage the economy in a way that is inclusive—a place for everybody with returns to everybody—that is sustainable, and that is a high-value economic strategy, or they can have more of the same. More of the same means declining productivity, it means public relations spin from the Government, and it means that most New Zealanders are getting poorer, stung by a crippling housing crisis. So let us first name the game, then let us look at the effects, and then let us look at how we change it.

The Government’s game is pretty obvious to most Kiwis: open up the gates to immigration and unrestrained foreign investment, pump up the dollars, do not give a damn about the impact on individual Kiwi families, but just go for the headline number, that total GDP. OK, it is increasing by about 3 percent a year, but GDP per person is declining to flat. Productivity is declining to flat. We are stuck with all our cows in one exit, making commodities that are worth less and less, and now, after the fact, the Government is talking about diversifying—something it should have been talking about a decade ago. So the game is to pump up that headline number by letting in as many people and as much investment as you possibly can, and ignore the effects on the ground.

What are those effects? The first is that most New Zealanders are getting poorer. Here are the numbers, and they are from the Government’s sources and from the Parliamentary Library: working families’ share of GDP—that is, New Zealand’s total income—has fallen by $50 a week per family under National. Under Labour, around 51 percent of all extra growth went to working families. Under National, that has declined to 37 percent. The difference is about $50 a week that families should be getting but they are not.

And 50,000 more Kiwis are unemployed under this Government than under the previous Government—50,000. Unemployment is 144,000 now. By the Government’s own numbers it was 96,000, which was, admittedly, too many, but it has gone up by nearly half, another 50,000, and many of those are young people—80,000 young Kiwis are either not in employment or not even in education and training. The Government has left them behind. If they did have jobs, then they would discover that it does not really matter, because the Kiwi Dream for them has gone because National’s housing crisis is crippling middle New Zealand—absolutely gutting it.

People hate living in Auckland now, for two reasons: (1) the “Minister for Gridlock” has not fixed the traffic because the Government is pumping up the immigration numbers to make GDP growth look better. There are 40,000 more cars on the road in Auckland, and you cannot take that many people on to the trains. It is getting worse—ask any Aucklander—not getting better. And what are they driving to? Well, it will not be a house that young people can afford to buy, because the housing crisis has become a national shame. People are leaving Auckland in droves. It is getting hard for schools to recruit teachers, hard to employ nurses, and hard to get cops to go there, because they cannot afford to live there.

Think about the impact on superannuation when a generation from now most people will not have paid off their home because if they have one at all they will get into it later in life and they will not have time to pay it off. New Zealand superannuation was not built to pay mortgages and it was not built to pay rent. The elder poverty in New Zealand because of this Government’s housing crisis is going to be crippling—yes, Mr Chair, it is the Estimates debate, and we are lifting the lid on some of the underlying economic problems that are driving New Zealand backwards. You cannot get past the housing crisis, and all New Zealanders know that is true.

The third key issue is that there is no plan for sustainable economic growth. You get rich as a country by lifting productivity and by making sophisticated products and services that people want to buy. Do you know that in Fonterra, in the last 5 years, the proportion of milk going into high - value - added products has not shifted at all? Under this Government’s watch, no more product is going into high-value—

I would like to reflect on a couple of points made earlier by Dr Clark and Mr Lees-Galloway, when it was quite obvious that they had not been to the regions. They did not know what was going on. There were contributions of woe and misery. I just want to reflect on what is happening in the region that I represent, the Wairarapa region.

People are coming to the Wairarapa. They are coming to the Wairarapa from Hawke’s Bay and from Palmerston North. It has a GDP growth above average in the Wellington region. It has a GDP growth rate that is above the Wellington region’s average, and that is because of several things. Tourism is on the up: 2.5 million people came to New Zealand as tourists in 2010, and 3.3 million last year. Whether it is tourists from the boats that sit in Wellington Harbour driving over the hill to enjoy the wines, the balloon events, or the aerodrome events, tourism is one of those diversified industries that Mr Cunliffe says that we do not have in this country. We have it, and it is succeeding and it is contributing massively to the region. I am sorry to tell you the good news, guys, but the regions are doing well.

Capital Precut Solutions is a company in the Wairarapa. Here is what it does. It takes laminated wood product from Juken New Zealand and Kiwi Lumber, which is another local business. It cuts it into bits, it forms framing solutions, and it sends them to Auckland. That is what regions can do. They export to the larger cities, and to Christchurch, where the building activity is progressing. We know that we are in a construction and building boom—the biggest construction and building boom ever—and the Wairarapa is contributing to that building boom. Waingawa log hub—the Minister mentioned it earlier. That hub has doubled in size. That is a hub where thousands and thousands of trucks—

💬 Hon David Cunliffe: “Truck lovers”.

—truck lovers—truckloads of wood are going on to the rail. That hub is saving 16,000 truck movements—16,000 truck movements are not going over that hill because of the railway network. So that is what is happening in the regions.

Watson and Son’s honey is another example. We have heard about mānuka honey, the thriving industry that it is—particularly along the east coast of the country. Watson and Son’s honey is 50 percent owned locally and 50 percent owned by Ngāi Tahu. That is demonstrating that new money is going into the regions. That business is looking for doctorate and Master’s graduates, to build its employee numbers in its laboratories. We are not talking low-skilled jobs here; we are talking high-skilled jobs in the regions. Karaka Whips is a simple business. It is a family-owned business. It exports whips throughout the world, all from the Wairarapa.

I do not know where these guys have been, but they certainly have not been in the regions. They do not know what is going on in the regions. I do, and other MPs here who represent regions do. Those members talk about immigration funding the economy. Well, it has been said before, but it is not the number of immigrants coming in; it is the people who are not leaving that is making the difference. It is people who are not leaving who are making the difference.

💬 Hon David Cunliffe: That’s bunkum. Give us the numbers.

For decades we have been bringing in 40,000 to 50,000 new immigrants, and we have been doing that for ever. The difference is that people are voting with their feet and they are choosing to stay. I tell you what, despite these guys on the other side blaming immigrants, I will tell you the facts. Last week I was in Nelson speaking to a group of people, and I asked them: “How many of you were not born in New Zealand?”. I was quite surprised. About a third of them were not born in New Zealand, let alone in Nelson. So then I asked this question of the same group: “How many of you were not born in Nelson?”. Virtually none of them were born in Nelson. They were all internal immigrants.

💬 Hon David Cunliffe: I can’t bear this any more. I’m leaving.

Immigration and people are what makes this country great, Mr Cunliffe. Immigration is what give this country character and diversity and brings in new ideas and entrepreneurial spirit. That is what we need in this country. We want to encourage it, not discourage it.

I am delighted that Simon Power, the Minister of Transport, is here—

💬 Tracey Martin: Simon Bridges.

—because he has—Simon Bridges, sorry. We do miss Simon Power in this House, I think, but I am very glad that Simon Bridges is in the Chamber, given that one of his colleagues was formerly extolling the Government’s policy around electric vehicles, where the Government has a lofty vision—a grand goal, if you like—of doubling the number of electric vehicles. There is huge growth in that area, but no real plan other than to allow them to drive in bus lanes.

I do feel sorry, I have to say, for the Minister of Transport. I do not know how many Cabinet papers he has taken to try to get the Government to come onside with some kind of plan to really increase the uptake of electric vehicles and has had them just batted back over and over and over again. But having a group of people who can afford electric vehicles to be able to drive in the bus lane is not going to significantly increase the number of electric vehicles in this country. If you want electric vehicles in New Zealand, you have to address the fact that they are very expensive. You have to bring down the price and the best way to do that is to get rid of fringe benefit tax on them so that corporate fleet buyers bring in electric vehicles, and then, 2, 3, 4 years later, those vehicles enter the second-hand market, which is where the vast majority of New Zealanders get their cars. That policy is something that has not been able to get through this Government, because it just does not believe its own hype, as with so many things when it comes to its economic development strategy.

We have a choice between the Government’s economic development strategy and a Green economic development strategy, and I just want to talk about what distinguishes those two things apart from each other. Mr Cunliffe was making a few points before about how we have pursued over the last decade or so in New Zealand a commodity strategy of low productivity—low-wage, simplified products that are easy to compete with on the international market. An example of this is in dairying, where we have pursued a volume over value strategy for years and years now, and it is not something that we are immune to competition on. The Americans produce about twice as much milk per cow as New Zealand does. They actually have way higher productivity because they use all sorts of terrible ways of maximising that product, but in the commodity market, where it is low value, they can actually out-compete us on volume. The American Dairy Association has a strategy of displacing New Zealand in the Chinese market, which is where we have pretty much got all of our eggs in that particular basket.

The other thing about this strategy, coincidentally, is that it treats the environment and the economy as two things that need to be balanced against each other—that there is a trade-off between those two things. So the Government’s economic development strategy is commodity, low-value, simplified products. If you look at the manufacturing over the course of the last decade, although manufacturing export volumes have increased marginally, the proportion of those products that have gone offshore is trending towards simplified, low-value products rather than towards more complex, high-value products. So even in an area where you have got what you might say at first blush is a pretty good-news story, what is happening is that the majority of that is actually going down the value chain rather than up the value chain.

On the other hand, the Greens’ economic development strategy is for high-value, niche, Brand New Zealand products that are hard to compete with because they trade on the very thing that underpins Brand New Zealand, and that is actually the environment. So, actually, rather than treating the environment and the economy as two things that are to be balanced against each other—where there is a trade-off against each other of those two things—there is, in fact, a multiplier effect between the two, where you actually have businesses that enhance and restore the environment, and that actually creates the value in them.

So, for example, in the heart of the Waikato, in the heart of dairy country, there is a tea plantation on a former dairy farm: Zealong tea—100 percent pure, organic New Zealand tea. They can sell tea in China—this is a New Zealand company selling tea to the Chinese—for NZ$300 for a 135 gram tin of tea. It is good tea, right, but that is pretty bloody pricey for a tin of tea. They do small volumes of the world’s best tea, but if you talk to the people who run that company, they will tell you that 90 percent of the value of that is in the air and the sun and the soil that make up New Zealand, because we are the only country in the world that can produce tea without—

All I can say is that Alastair Scott walks around with rose-coloured glasses on in the Wairarapa, Simon Bridges walks around with his fingers in his ears, and Steven Joyce—one of these days he will fall off his wall, and all the king’s horses and all the king’s men will not be able to put him back together again. Everywhere across New Zealand—everywhere—this Government is failing the regions. Many regions’ economies are shrinking, with incomes and employment falling. It may be of interest to members that of the hundreds of constituent cases that come through my office, 26 percent of them come from outside my electorate. Of that 26 percent, most of them come from Clutha-Southland, which is the electorate next to mine. Most of those cases are housing-related and health-related, exacerbated by low incomes and unemployment, and this tells me two things: (1) that the local member is not doing his job, and (2) that people are hurting.

If you do not believe me, then how about this? Southland is in recession. Southland’s economy shrank by 9.9 percent last year. The average household income in Southland fell by $49 a week in the last year. The number of people who are unemployed in Southland has more than doubled since 2008, under National. Southland’s homeownership rate fell 4 percent between census 2006 and census 2013, which is the biggest fall in the country, from over 73 percent to under 70 percent. The Otago economy has stalled, with zero percent growth in the March 2016 quarter, and of course Otago includes Queenstown and Central Otago, which are growth areas. But its economy as a whole has stalled. The average household income in Otago fell by $98 a week in the last year.

In the meantime, in both Otago and Southland $94 million has been cut from the Southern District Health Board since 2010, and last year nearly 3,000 people in both of our regions—Otago and Southland—were denied operations after being referred by their GP.

I went and did a survey of parts of Clutha-Southland, given that so many people were coming into my office with cases—Milton, Gore, Balclutha, Lawrence, and Kaitangata. Guess what the majority of those people said? They said that the issues they were most concerned about were growing inequalities and the gap between rich and poor, not enough available jobs, affordable housing, and access to health services. These regions are hurting. They are really hurting. There is not enough opportunity in these regions for young people. There are not enough opportunities for people for employment, to give them hope in their lives.

This leads me on to my next point, which is around infrastructure, given that this is the Estimates debate around infrastructure. I want to touch on another vital aspect of regional economic development that could provide a kick-start to our regions but which this Government is sorely neglecting, and that is rural broadband, which is absolutely holding back regional New Zealand.

I have got two communities quite close to Dunedin that have written very well-written reports pleading for resources to help them kick-start their connectivity, one on the whole of the Otago Peninsula and the other includes the whole of the Strath Taieri, which includes Middlemarch and Hyde. Both are areas of strong tourism: ecotourism on the Otago Peninsula, and the Strath Taieri, which is the beginning of the Otago Central Rail Trail. Neither of those communities can get any funding, despite Amy Adams’ claims about rural broadband and how fantastic it is and how much it is delivering to rural New Zealand. They say how much this is holding them back as communities—not giving hope to young people to get jobs, holding back their core industries, and farmers not being able to log on. These issues are holding these communities back.

It is said that economics is the dismal science, and it is true that Fletcher Tabuteau has told us all that he has an economics background. But I have to say, listening to the members on the other side this afternoon, it is clear that they are all aspiring economists doing their very, very best to talk down New Zealand, to talk down the opportunities for New Zealanders, and to cherry-pick figures out of thin air to try to show that things are not as good as the facts actually point out.

The reality is that the backdrop of the 2016 Budget is set against sustained, solid economic growth, and Treasury is forecasting stronger growth to come. So it is forecasting, for instance, that over the coming year real GDP will rise 2.9 percent—

💬 Sarah Dowie: How much?

It will rise 2.9 percent—thank you, Ms Dowie—and in the 5 years out to June 2020 it will average 2.8 percent. That is solid and sustained growth. But, more than that, there were 200,000 more people in work over the last 3 years, and Treasury again is saying that a further 170,000 jobs are expected by 2020. In that same period the average wage is forecast to rise to $63,000 a year. That is $16,000 more than when National took office. This is also set against a backdrop of record low inflation, where, basically, the news headlines are saying that inflation is effectively zero. It is not quite, but they are saying it is effectively that. Interest rates are also at 50- or 60-year lows. The Opposition tries to tell us that people are going backwards. People are not going backwards; they are going forwards at a great rate of knots under this National Government. Let us keep the good times rolling for all New Zealanders.

But on top of that I also have to point out Mr Shaw’s comment. It was a newsflash moment. He was talking about electric vehicles and how bus lanes will not help. Mr Shaw, a Green MP, stood up in this Chamber and said that bus lanes do not work.

💬 Simon O’Connor: What?

He said that bus lanes do not work. Of course, the main reason for having bus lanes is that having a dedicated lane where that traffic can flow more freely will motivate people to take that form of transportation. But Mr Shaw said it will not work. So—newsflash—bus lanes do not work well. It is an interesting headline for tomorrow’s Dominion Post. Perhaps we should just get rid of them all in Wellington, according to Mr Shaw.

But back to the Budget. Looking forward, why Treasury is saying that the economy will grow so strongly is because it knows that this Government has plans particularly around an innovative New Zealand economy—diversifying, in addition to our traditional primary sector strengths. We do not believe that a country or an economy is a zero-sum game. We believe that we can continue to have strength in our primary sector, while also diversifying and growing strengths in other areas, such as ICT, which is my background. This is an industry that, incidentally, in export terms, has been growing at about 13 percent per annum, and even the complete sector, including domestic, has grown at 9 to 10 percent, year on year, which is great news.

This Budget saw an investment of $761 million for an innovative New Zealand. I am very, very pleased to see investment in both applied but also very basic, foundation research. As we can all understand, the private sector will have incentives to get involved in applied and experimental research because there you can see a much stronger link to a commercial outcome. The work we have been doing with Callaghan Innovation, as research and development performers and also as grant administrators, is helping to motivate those companies to invest more of their own cash and their shareholders’ equity into research and development, particularly in those areas where they can see the link to a commercial product.

But it is still important for us as a country that we do not lose sight of that most basic research—research that traditionally has been performed by universities both in New Zealand and also in other countries—and that has been funded by Government because of that non-clear link to a commercial outcome. I am very pleased to see, for instance, the additional $66 million over 4 years into the Marsden Fund. I have heard representations from the Institute of IT Professionals that would like us to lobby for the Marsden Fund to prioritise some more of that research into ICT areas. Given my background, I am very pleased to champion that.

Another area of infrastructure that I want to touch upon, as I conclude, is ultra-fast broadband. This is opening up opportunities for New Zealand businesses and New Zealanders, and 2.4 million New Zealanders can now connect. The build is almost at 70 percent—great news.

I am pleased to take a call on behalf of the Green Party in the Estimates debate. I will confine my comments to the whole issue around immigration. Immigration has been used by unscrupulous demagogues like Marine Le Pen in France or Donald Trump, basically, to beat a loud drum and scare citizens. But the Greens have a consistent stance on immigration. What we think is that when immigration is properly supported and managed sustainably it has clear benefits beyond and above the economics, through enriching our culture, providing new ideas, and bringing needed skills to our country.

Many of us here in this House, whether we arrived by boat or by plane, have an immigrant somewhere in our history. But the problem that has become clear to me, after spending the last year meeting with various migrant groups, with unions, with multicultural associations, and with other stakeholders right across the country, is that National has let down migrants and National has let down New Zealand by prioritising the quantity of immigration over the quality of support. From international students to migrant workers to permanent residents, this National Government is letting New Zealand down.

I recently met with the Auckland University Students Association (AUSA) about international students, and what they had to tell me was pretty bleak. It seems as if the push for the export education market has been at the cost of the quality of life of international students, and also at the quality of education. Many of the international students who come here are paying four to five times what domestic students pay. Those fees are unregulated by universities’ fee maxima policies. At the same time, these international students are unable to access pastoral care, including access to some of the health services. AUSA has said that international students are disproportionately more at risk of being exploited than anybody else. We just have to look at the whole scandal earlier this year about students offering sex for rent as an example of how that plays out.

So when you look at the evidence, AUSA is right: a 2013 report from the Ministry of Business, Innovation and Employment estimated that one in 10 international students are being paid below the minimum wage. A 2010 Auckland University of Technology (AUT) report backed that up and found that 38 percent of those surveyed received below the minimum wage, and a 2011 thesis found that 42 percent of Chinese international students were also being paid below the minimum wage, as compared with about 7 percent of domestic students. None of these students should be paid below the minimum wage. Perhaps most shamefully, a 2012 AUT report on the experiences of international students and recent graduates on job search visas working in the horticultural industry in the Hawke’s Bay found that a shocking 93 percent of those students were being paid below the minimum wage, and nearly half of them did not have formal agreements.

We have got a lot of work to do to ensure that our minimum employment standards are met. Is this the sort of country we want? Is this the manaakitanga that we offer? Because it falls well short of what we should be doing. When we invite people here, we really should be treating them with dignity, with respect, and with compassion, but the Government’s focus is on quantity of immigrants over the quality of support. What that means is that our public services are stretched, our infrastructure is stressed, and our migrant support centres are stretched. The labour inspectorate’s annual report stated that nearly one in five investigations into suspected breaches of employment standards are not completed within 6 months of receipt of the complaint.