Trans-Pacific Partnership Agreement Amendment Bill

I raise a point of order, Mr Chairperson. I raise this point of order now, so that there is perhaps some time while the debate goes on, and over the dinner break, for a considered ruling from you. I am raising this point of order under Speakers’ ruling 130/2 around the issue of commencement dates. Speakers’ ruling 130/2 says: “An amendment to a commencement date must provide certainty about when the Act is to come into force. An amendment that relies on an indeterminate event is not in order.” The amendment that has been made to clause 2(2) of the bill—the commencement date—says: “That date must be the date on which the Trans-Pacific Partnership Agreement, done at Auckland on 4 February 2016, enters into force for New Zealand.” As is well known, and perhaps dependent on events that might take place tomorrow in the United States, that is not a date of which there is any certainty at this time. I am concerned that the amendment that is proposed in the legislation, under clause 2(2), in fact breaches Speakers’ rulings and would be out of order. So I would seek your guidance on that, and perhaps a considered ruling.

Thank you for that. I will seek some guidance on this matter. This was a provision that was put in place by the Foreign Affairs, Defence and Trade Committee and agreed to at the second reading. It happens to be here, but I do take on board what you are saying. I am happy to seek advice on that matter.

It is a pleasure to take a call—the first of a number of calls I hope to take—in the Committee stage of the Trans-Pacific Partnership Agreement Amendment Bill. I want to start my contribution—or I would have done had we been doing a clause by clause debate—with clause 1, which is the title of this bill. This emphasises part of the problem that we have here today. This bill is called the Trans-Pacific Partnership Agreement Amendment Bill. As is the nature with legislation like this, there is not actually any one piece of legislation to amend. There are a series of very small and in many ways inconsequential amendments to a number of different Acts: the Agricultural Compounds and Veterinary Medicines Act, the Copyright Act—actually, the amendments to the Copyright Act are not inconsequential, and I will come back to them in the fullness of time—and also around the various trade provisions in Acts that we have.

That is part of the issue here, because many New Zealanders have been concerned about something called the Trans-Pacific Partnership agreement (TPPA), as named in clause 1 of this bill. But, as such, it does not exist in New Zealand law. That highlights the problem of the fact that this Parliament has not had an adequate opportunity to debate the overall nature of the TPPA, and of the ability for New Zealanders to reflect their concern about that.

I think, over the years, it would be fair to say that I have changed my views somewhat around Parliament’s role in looking at agreements like the TPPA. This is because as trade agreements themselves have changed and developed from being fairly basic agreements about market access and services, and access of goods and services to markets, to the more complex agreements like the TPPA—the 6,000-odd pages of it—I think there is a greater case for more public scrutiny and more public debate on whether New Zealand should be part of these agreements. The issue we have today, as we come to debate this, is that New Zealand has already signed up. New Zealand has already signed up—this is the ultimate box-ticking exercise; this is the ultimate arrival in Parliament, where—

💬 Todd Barclay: Sit down—sit down.

Ha, ha! Todd Barclay has just told me to sit down. That is not going to happen, Mr Barclay. In fact, Mr Barclay, if you keep that up, you are going to be here for a very, very long time because this piece of legislation is not supported by a lot of New Zealanders—not because of the detail of the amendments to the Acts that are contained within here, but in part because Mr Barclay and his Government have decided not to take New Zealanders with them, have decided not to have a proper discussion with New Zealanders about the benefits and the costs, but rather to sign up and then come looking for a rubber stamp from this House. That is not what we are elected for. We are elected as members of Parliament to actually represent our constituents, and to debate and decide upon what is best for New Zealand. This is the sovereign Parliament of New Zealand, and I am sorry to say that the way that the National Government has approached this agreement means that the sovereignty of this Parliament has been undermined.

I would say, when I look at the title clause and I see the “Trans-Pacific Partnership Agreement”, I wish that we were really debating that agreement; that we were really debating the pros and cons of that—the costs and the benefits. But instead the legislation is actually a series of technical amendments to various pieces of legislation that are affected. There should actually be, I would say, considerably more bits of legislation being amended here—were it not for the fact that New Zealand has actually largely removed most of the tariffs that would potentially have been in another country’s piece of legislation ratifying the Trans-Pacific Partnership agreement. Over the years, our lay down misère approach, as I discussed in the second reading, to trade negotiations means that New Zealand ain’t got much left when it comes time to negotiate in trade agreements. That is the case for New Zealand when it comes to the TPPA.

The second point I want to make about the name of this piece of legislation is that, actually, in some ways it is a bit more honest than some of the commentary from the Government has been about what is actually happening here. We keep getting comments from National Government members about how anyone who is opposed to this is opposed to trade. Well, what utter and complete nonsense. I have stood in this House before and debated free-trade agreements (FTAs), and they have been called free-trade agreements or free-trade ratification agreements. This one does not say that. This one calls it the “Trans-Pacific Partnership Agreement”. That is actually a reasonably fair reflection of an agreement that goes well beyond actual market access, the actual tariff debates—in fact, we do not have a lot of that in here. What we have are things like amendments to the Overseas Investment Act, because, actually, the Trans-Pacific Partnership is an agreement—yes, about some market access provisions—but also about the way Governments regulate and about the way Governments make their decisions; the kind of decisions that this Parliament should be making.

The frustration for members on this side of the Chamber is that we are not actually in here today debating, for instance, the decision of the National Government to deny a future Government the right to say who it is who should be able to buy residential property in New Zealand. In other Parliaments around the world when they are debating the ratification—when they are in Australia or when they are in Vietnam—it will be debated; in Singapore, it will be debated. This is because those countries decided that “Yes, we will actually reserve the right of our sovereign Parliament to make a law in that way.” But that is not here. That is actually not one of the clauses that we get to debate today because the Government did not come to this Parliament before it signed up to that—or, in fact, signed away the right for New Zealanders to do that. So this agreement, the TPPA, is fundamentally different from the New Zealand - China free-trade agreement or the New Zealand - Korea free-trade agreement, which we have debated before in this House and which the Labour Party not only initiated but, in the last 8 years, has been prepared to support—the ratification of those agreements. This one goes further.

This one goes further, and at the same time, the Government has done as little as possible to take New Zealanders with it in going further, in explaining what some of those benefits might have been, and being honest about what the cost might have been. I do want to say this now that the Minister in the chair, Todd McClay, is here—because he was not here when I said this in the second reading—and that is that, actually, I think he has started to do that now that he has got into the job. He has actually started to get out and get around New Zealand and say: “This is what’s happening.” Well, sorry, it is too little, too late, because the previous Minister, Minister Groser, knew so much more than the rest of us did—

💬 Hon Member: About everything.

About everything, actually, but about this in particular. He did not need to do it, he knew everything; free trade was in his blood. This is the man who once said that Closer Economic Relations (CER) should be called GER—“Groser Economic Relations”—because he was the third secretary in the embassy in Canberra when it was passed. It is that attitude from Mr Groser that typifies what is wrong with this agreement: negotiated without being transparent for New Zealanders about what was involved, and relying on “constructive ambiguity”, as he told Mrs King and myself in a meeting where he said we could talk about everything he said. When we questioned whether or not New Zealanders would pay more for medicines because of the changes that were being made here around patent law, he said there was constructive ambiguity. Constructive ambiguity—that is as good as it gets from this Government when it comes to the TPPA.

So it is difficult for members on this side of the Chamber to be able to stand up and make the contributions that we need to make on this, because, actually, the legislation in front of us does not give the full picture of what the TPPA is, and we have not been included in the debate at the appropriate time. I know from when we did less complicated trade agreements like the New Zealand - China FTA that we worked hard in Government to make sure that stakeholders knew. We met with unions, we met with environmental groups, we met with businesses, and we talked through what we were doing. We trusted those people to have New Zealand’s best interests at heart and to be part of the discussion. Not this Government—total veil of secrecy, and then Mr Groser telling us at the end to trust him and that he knew everything.

The sad reality is that he told us this would be a gold standard agreement. It is not a gold standard agreement—it falls miles short of that in every respect, and, at this stage, it does not even look like it is going to enter into force anytime soon. So here we are, debating to ratify something that probably will not ever exist, that will be renegotiated, and that was put forward by a Government that did not do for New Zealand what it should have. This could have been done so much better than it has been.

I am surprised that the Government members, who are so proud of this agreement, have got their bottoms stuck in their seats. I wonder whether they are going to, at some stage, get on their hind legs and contribute to the debate. I am looking forward to hearing from them, because I have listened to a lot of blatherskite—my favourite word—from this Government over the last few years on trade policy. One of things it has tried to do is paint the Labour Party as anti-trade. Well, I think we could probably give it a few lessons on how you go about negotiating a trade deal.

The Government likes to come into this House on a regular occasion and trumpet the wonderful things that have come out of the China free-trade agreement, negotiated and passed under a Labour Government—the only thing, I think, that is probably holding up our economy, in fact. When we were in Government, we negotiated a free-trade deal that got wide acceptance. But what happened when we got to the Trans-Pacific Partnership? Many of us started off thinking: “This could be a really good idea. This could be an extension of the China agreement into other countries. This could be good for New Zealand.”

But what we managed to get from this Government and from the negotiation was to allow a number of other things to be included in an agreement that has nothing to do with trade—it has nothing to do with trade. So it is not a free-trade agreement; it is a free-for-all agreement. It has got everything in it. The fundamental error the Government made was to rely on Mr Groser to be the advocate and the negotiator for this agreement. I have to agree with my colleague Grant Robertson that Mr Groser came across, to me, as a person who was far above the rest of us, who knew more than anybody else in this entire Parliament—in fact, he created the world in 6 days. I found his attitude appalling. I was at the meeting where we met for the confidential briefing after it was all signed and sealed, and we were told that we could speak about what we were given at that meeting. When we did go out and speak about it, we were attacked for speaking about it. The words that he used when it came to patents—

💬 Grant Robertson: Constructive ambiguity.

Constructive ambiguity. What is constructive ambiguity? It sounds like an oxymoron to me. What is constructive about the ambiguity that he wanted to put into this agreement? I think we could be wasting our time, because tomorrow the 45th President of the United States will be elected. If you have been watching what is happening, both Trump and Clinton have said this deal will not be passed in their Government. So what we are relying on, when we are ratifying this, is the slim hope that Obama somehow is going to, in the lame duck period, pass the legislation. Well, I put this to the Minister, Todd McClay: why would the Republicans give him a thing? They have denied him every move he has tried to make in Government. They have blocked practically every move he has ever made. Why, at the last moment, would they capitulate and give a win to Obama?

So I would say that we are probably wasting New Zealanders’ taxpayer money holding this debate now. Would it not have been more sensible for us to have waited to see what the next President of the United States would do? My understanding is that you have to have 80 percent agreement to this deal, and if you do not have the Americans in, then you have not got 80 percent. We were also told by others—in fact, I think Hillary Clinton said: “We’ll renegotiate it.” Well, we were told by Mr Groser and others—I think, even by the Minister in the chair, Todd McClay—that you cannot renegotiate it. So who is telling the truth here? Can we renegotiate this or can we not? Todd McClay said we cannot. Of course Mr Groser—who knew everything—said we cannot. Mr McClay said we cannot. Hillary Clinton said we can. I hope we can believe our Minister, that what we have got, we are stuck with. So, in fact, the things that are wrong in here are now set in concrete. What is set in concrete and is wrong, as far as I am concerned, is the way it has been negotiated.

One of the things that really appals me—and the Minister might like to explain—is that we capitulated and rolled over like pussycats to have our tummies tickled on the whole issue of foreign non-resident buyers in our housing market. Why did we not have the guts to stand up like Australia, like Singapore, like other countries that said: “We have sovereign rights over what happens to our land and property in our country.”? Why did we roll over and allow that to be carved out so that we cannot have the same deal made by Australia and Singapore and other countries that showed considerable stamina and courage and ensured they looked after the sovereignty in their countries? I do not understand that, Minister.

This Minister probably is not to blame, but why were we so keen? We did not need to give that away. There were other countries that did not give it away. But, you know, if there is one thing that has got up the nose of New Zealanders, it is the fact that we were prepared to say: “Anyone can come here and buy what they like. Doesn’t matter if you don’t live here, you can buy up the houses—none for New Zealanders; doesn’t matter.” So that, I think, has offended many, many New Zealanders, and it certainly offends me.

But the one thing that I think needs explaining is the whole issue of patents. I think it is interesting if you go back and read the regulatory impact statement from the Ministry of Business, Innovation and Employment and what it said about the whole area of patents. It set out what had been negotiated. It said that it was to enable a reasonable delay in terms of a patent being applied, and if there was a reasonable delay, then there could be a response from that.

But what was more interesting to me was what the ministry thought about this whole issue. It said this: “13. An obligation to provide patent term extensions could result in costs to the New Zealand economy. 14. New Zealand is a net importer of patented technology. Most (85 – 90%) of the patents granted in New Zealand are granted to offshore applicants. If the terms of any of these patents are extended, this could impose a cost on the New Zealand economy as local businesses and consumers would have to pay higher prices for longer on products using patented technology. The cost could be particularly high if a patent related to a pharmaceutical were to be extended. When the patent on a pharmaceutical expires, the price may drop as much as 80 – 90% as generic versions of the patented pharmaceutical enter the market.”

A large number of the pharmaceuticals that Pharmac can afford in this country are generics. The reason why we have a large supply of pharmaceuticals is that they are generics. I have concern over this issue, and the concerns are not just mine. Our top health professionals around this country have raised their concern over this issue. I have to say that it is still not clear to me what would constitute an unreasonable delay. They say it could be the delay between when it is lodged and when a decision is made. What if something happens in between that is not of the making of those making the decision? I can see this being used by those companies that wanted to take away the 5-year patent on data exclusivity—to use this to in fact attack New Zealand and to ensure that they get a longer patent on their products. That will cost us in money. It will cost us in the health of New Zealanders.

I do not think this has been properly explained by the Government. I do not know how much notice it took of the ministry when it wrote this regulatory impact statement, but what I do know is that with these new biologic drugs, if we cannot get access to the data of that so that other companies can use the data and start creating generic drugs, we will see more of the problems we had with Keytruda, because we will not be able to afford the drugs that are still on patent. I think that this Government is going to cost us a lot in terms of the health of New Zealanders and the taxpayer.

It is my joy to take this slot, just before the dinner break.

💬 Grant Robertson: Drive time.

Drive time, as you say, Mr Robertson. It is nice to see that the Government benches have realised what we have long known about the Hon Annette King. She is a force of nature. We have these staunch proponents of trade who are all firmly glued to their seats, unwilling to take a call in this Committee stage to debate this very important piece of legislation that we are told over and over again by Government members is so critical and so good. But, obviously, the powers of the Hon Annette King have persuaded them all there.

As has been said by the previous speakers, Labour cannot support the ratification of the Trans-Pacific Partnership agreement (TPPA) through this bill that we are here debating today, because the bill’s passage through this Parliament facilitates the final ratification of the agreement. As my colleagues Grant Robertson and the Hon Annette King have talked about, what we have in this is an omnibus bill that puts together a lot of small changes—some of them not so small—but in and of itself there is a broader issue that does need to be discussed.

I do want to look at some of those broader issues, but also in the course of this contribution I want to have a look specifically at clauses 66 to 70 in Part 7 of this legislation: “Amendments to Overseas Investment Act 2005”. I, more specifically, want to have a look at what this is not covering, what these clauses from 66 to 70 do not cover, because I think by and large that is of a great interest to this Committee as well.

What we have said time and time again is that Labour is a party that supports free trade when it is about trade.

Sitting suspended from 6 p.m. to 7.30 p.m.

It is always a pleasure to take a call split by the dinner break. When we last tuned in, I was outlining how Labour had always been a party that supported free trade, but what we have in front of us today is not about trade. What we have in front of us is some enabling legislation for something that goes much broader than that. My colleagues, before the dinner break, have touched on several of Labour’s concerns and objections to this legislation.

Before the dinner break, Hon Annette King was talking about our concerns in regard to Pharmac as well as other areas and the ability of New Zealand to have the kind of health system that we want to have with the kinds of expansions put around patents under this, and, in particular, our ability to be able to afford the next generation biologic drugs that we will need. We have already seen that we are starting to need these in our country.

One of the things that has also stood at the centre of Labour’s inability to support this agreement and the subsequent legislation that we are here debating today is that when you looked at it, the case just did not stack up. We were sold by Minister Groser, when he was going off to negotiate this, on what a huge benefit to New Zealand this was going to be. But when the national interest analysis that accompanied this treaty came back, we saw in stark reality what it did mean.

Was it going to be the huge win for dairy that the Minister said it always had to be or he was going to walk away from this? No, it was not that huge win for dairy. Instead, we saw very minor gains for dairy. We saw that the increased access, not the profit, would be the equivalent to the output of only three large dairy farms begs the question why he did not walk away. The gains that were promised simply were not there. But more than there just not being the gains there was an alarming analysis that was undertaken by Tufts University that talked about how it could be that 6,000 jobs within New Zealand could actually be lost because of this legislation. So not only would New Zealand be not making the gains that were originally sold to them when people first came to look at the idea of the TPPA, but actually some people would be worse off. It is as the Hon Annette King said. When this idea of the TPP first came up there were lots of people who thought “This could be good, let’s have a look at what it has to offer for New Zealand.” But the simple and stark reality is that it just did not pan out.

I know that everyone will be remembering before the dinner break that I said that I was specifically going to talk to Part 7 of this legislation, and particularly clauses 66 to 70. These are the clauses that amend the Overseas Investment Act 2005. What the bill commentary says is: “Clause 69 would insert new section 61A and provide a regulation-making power to implement alternative investment screening thresholds for overseas investments in significant business assets. Under the Agreement, and under the most-favoured nation obligations in certain international agreements listed in new section 61A, the threshold above which an overseas person must get approval to invest in significant business assets in New Zealand must increase from $100 million to $200 million for non-government investors from parties to those agreements.” I could go on but I will not, in terms of reading from the description.

What is contained in these clauses 66 to 70 is that the Government did not stand up for New Zealand, and Tim Groser did not stand up for New Zealand when he was off doing the hard negotiations around this. When he came back he said that we simply could not put in the protections so that we would not lose the ability to restrict the sale to foreign investors of our homes, our farms, and our businesses. He said that it could not be done—simply could not be done.

The reality that New Zealanders have to face is that our Government did not fight for us in the way that other Governments fought for their countries. So when Tim Groser said that one could not do it, well, other countries did. Other countries did exactly that. Australia did that and Singapore did that. Other countries got agreement that there would be the ability to put those kinds of restrictions in place. But where in clauses 66 to 70 is there the evidence that our Government stood up for us as New Zealanders when they were negotiating this agreement? It is nowhere. That is the answer to that. It simply is not in that because that is not something that this Government was interested in doing. It should have stood up for New Zealanders and they simply did not. Minister Groser said that it simply could not be renegotiated, but we have people around the world now saying it could be.

So there are a number of issues that have been brought up around this, and Grant Robertson brought up a point of order at the beginning of this debate around the clause that is actually dependent on something that we do not know that it is going to happen. We wait with bated breath to find out whether or not that is indeed in order, because we are all going to be glued to our sets tomorrow to find out what the outcome in the States is. But the reality is that both candidates in the US presidential election have said they are not in favour of this agreement. So why is it that New Zealand is steamrolling ahead, putting in place this enabling legislation for a treaty that we do not even know is going to pass the threshold? If the United States is not going to come to the party on it, then it is a dead duck itself. It will not get over the line. So I would like to hear from the Minister in the chair exactly why it is that we are pushing ahead at the pace we are, when we do not know the context that we are going to be dealing with and whether it is even going to be required.

When we look at this Trans-Pacific Partnership we can see the Government has promised so much from it, but what we are seeing here today is a Government that now just wants to be quiet at every turn around it. Government members tell us that it is going to be the boon for business. They have small businesses telling them that they are not in favour of it. Just over a third of small businesses actually want to see the Trans-Pacific Partnership enacted. The rhetoric simply has not stacked up with the reality and with the analyses. This is why Labour, a party that does back genuine free trade where it can be shown to have a benefit to New Zealanders, is unable to support this legislation, which would be the enabling legislation for the Trans-Pacific Partnership agreement. That is something that we will stand by and stand up for New Zealanders on.

I thought I would start this evening, in terms of a contribution, around the title and the commencement date because I would like to acknowledge an earlier contribution from my colleague on this side of the Chamber. I will speak first to the commencement date and make reference—well, I will not go through the specific Speakers’ ruling, but it does say that if the commencement date is amended, which it has been in this legislation, then, actually, the vagueness of the start date is not only inappropriate but not acceptable under the House’s rules. I note that it was changed in this version when it was brought back to the House, so that we could make some vague statement around the date on which the Trans-Pacific Partnership agreement (TPPA), done in Auckland on 4 February enters into force. It is not specific enough, according to Speakers’ ruling 130/2. I think the consideration asked for by the member earlier is not only valid but needs serious consideration and it calls for the House to come back and hear the Speaker’s ruling on that.

I then thought I would speak to the title, and what I thought was that what we have got currently is the Trans-Pacific Partnership Agreement Amendment Bill, but I thought the “Trans-Pacific Partnership (Agree Anything) Amendment Bill” might be more appropriate. I say that because I have never had the privilege of speaking to Mr Groser, and I do feel like I have missed out on a wonderful opportunity, but what I have had the opportunity to do is speak to previous employees of the Ministry of Foreign Affairs and Trade. The conversation ran around the fact that the previous Minister of Trade’s stance on trade agreements was: “Let’s sign up to anything, and then come back home and sell it to the people as something that’s great for this nation.” I think the TPPA is perhaps the prime example of an agreement being brought back to New Zealanders as a gold standard—and it could be a gold standard only if it was agreed to by the Minister—and I think New Zealanders will find that it is absolutely not that, at all.

I will quote a word, really, from one of the submitters. They were “flabbergasted” by the analysis and numbers used in the interest analysis, which they used to inform their submission to the select committee. I make that reference because in our analysis of this partnership agreement, the select committee was essentially forced to use an analysis that was abbreviated. It was a shorthand and, to be quite honest, it was insulting at times in the numbers that were given to us and what we were expected to take at face value, especially when we were able to contrast it with overseas analysis done and actually, to be fair, with some contributions from academics here in New Zealand.

The point there is that we are talking about amendment legislation to the Trans-Pacific Partnership agreement, which in the main, I have to say, is quite technical and quite small, because we are a country that is already set up to go in the main. But that word—that they were “flabbergasted” by the analysis and numbers used—was a direct quote from one of the submitters, and that is what we are having to go through now. When we look at the submissions and when we look at the enabling legislation in front of us, we were not given the information that we required to truly understand what the implications of this were or what the enabling legislation would bring about, such that—for example, the copyright terms and the patent procedures.

The Hon Annette Sykes—Annette King, sorry. What a Freudian slip—sorry. That was not intended—[Interruption] Yes, yes. She spoke about the Pharmac transparency model, and I would have to agree with her completely. The situation with that model, which is part of the enabling legislation, is such that we now have requirements on Pharmac to produce reports that can be used by any interested party in an analysis of Pharmac’s decision-making procedures. The conversation around that was in the uncomfortable state in that we know—and I use that word strongly, I admit—that a lot of those overseas international corporates will be using that facility to attack Pharmac’s decision-making on behalf of the people of New Zealand. I have had some debate online with some pretty reputable people who know a lot about the Pharmac model, and they tried very vehemently to dissuade me from my thinking, but this is the truth of the situation.

There is that whole question mark around transparency, and what I want the Committee to realise is that, actually, without even going into a renegotiation round—because we do not know what the Clinton or Trump blocs will do in terms of the ratification process—right now it is our understanding that there are side letters being circulated around the member State countries trying to circumvent what is a locked-in agreement such that we will be obliged to extend those patent extension periods even further. So these side letters are being circulated—that is what we are being told—but in an agreement where the American administration, by way of its process, has locked it in. We have said we will not renegotiate, and yet these side letters are being circulated on Pharmac, so it is a huge question mark as to what will happen with our biologics, and we know how critical they are as we move into the future.

So the issues are technical, as I said. They are minor, a lot of them, but there are a few significant changes where many of the submitters, especially around copyright and access to technology—I will find the technical term for a later contribution—were almost at odds in their contributions to the select committee. It was a confusing piece of legislation for both sides of the argument. Even those who supported it would often tell the select committee that there was a great deal of confusion and a lot of unnecessary detail in terms of the law and that it made for a confusing read, and many of the submitters said: “Let’s just not do it. Let’s wait for the ratification to go ahead, so that we actually know what it is that we are signing up to.”

I just want to finish this contribution by saying that we are here today after having completed the second reading quite precipitously. We are here now going through the motions, and yet we have Japan, which is going to run this through its Lower House very quickly to beat us to the goalposts in terms of supporting Obama’s attempt to push this through in the lame duck period—but, actually, that has fallen by the wayside. We have got Canada, which has been prepared to stand up from the start and say “We’re not going to say anything about this until we’ve had genuine engagement from the public of Canada.”, and it means genuine. It is still going. A year later, it is still engaging with its community base. We have got Vietnam, which had a great level of support from its public, actually—from its people—but the Government has decided that it is not in a position, and it does not want to be in a position, to race through the ratification. That has sent a quite strong message to the Obama administration with regard to his efforts in the lame duck process.

I say to the Committee this evening that we do not need to be here—we should not be here. The submitters themselves have talked about the confused nature of what it was they were submitting to, because of the interest analysis, and so much of what we see here is confused, it is unnecessary, and, as I said at the start, the timing of it is entirely in question. Thank you very much.

Can I thank colleagues for their contribution to the debate so far. I think it is a respectful debate and a very, very useful one, and I think anybody listening in will be enjoying it because this is very much the way that this House should conduct discussions about trade, more directly.

I want to go through a few of the points that have been raised by colleagues around this, but, before I do, I very much want to speak in favour and in support of the Trans-Pacific Partnership agreement as negotiated and signed, and certainly pay a very big compliment to the previous trade Minister, Tim Groser, for over 7 years having negotiated what many people said would not be possible and actually reaching agreement with 11 other countries that represent 800 million consumers—almost 40 percent of the world’s economy—spending $27 trillion of GDP every year. It gives unprecedented access for New Zealanders, New Zealand goods, and New Zealand services to these very important markets to us. I guess I would argue that the only country for which we have better access to through a comprehensive free-trade agreement would be Australia through Closer Economic Relations (CER), something that has been in place for so very, very many years.

It is pleasing to hear from members that they do support trade and recognise the importance of trade to New Zealand. You know, we are a country of 4.5 million people that can produce in an area of food—food alone—to feed 40 million people. I wonder, if it were not for our ability to sell internationally, whether or not generally we would run out of things to do after about March in the year. If without preferential access—or, in many cases, just fairer access—to countries because of free-trade agreements (FTAs), whether or not around about February—about the time this Parliament comes back to start work—the economy would run out of things to do.

I do want to pay credit to the previous Government in starting the negotiations, and Phil Goff, actually, for starting the negotiation of the Chinese free-trade agreement, because that has been exceptionally important to New Zealand over the last 8 years since it has been in place. And the China free-trade agreement is very similar to the Trans-Pacific Partnership agreement (TPPA) in as far as it is a comprehensive free-trade agreement.

Mr Robertson mentioned that this is more than just around the liberalisation of tariff schedules, and he is correct—it is. But actually, it has been quite some period of time since New Zealand—or any other country, really—has gone out and negotiated a trade agreement based just on tariff lines and tariff schedules. Actually, it is very important for our economy that we are more ambitious than that. The reason for this is we are not only a country that produces goods and sells them overseas; we are a country that also now provides services, increasingly, significantly, around the world. We are also a country now that invests overseas, and so on and so forth. So, it is important, I think, that our agreements are comprehensive. It is also important that they deliver for all parts of our economy.

I do want to say that when it comes to consultation and engagement—it has been said before; I will repeat it—this was a widely consulted-on free-trade agreement. Some of the people who were consulted in the very early days—I accept it was 7 or 8 years ago, and it is a very long period of time. But I asked the Ministry of Foreign Affairs and Trade to have a look for me to make sure—when I stood up in public in one of the more than 50 meetings I did around the country, as part of the 18 roadshows and hui that we did up and down New Zealand, including more when people asked us to do them; to talk about the agreement, to explain it, and to go through it with them—that it had been widely consulted on. I was informed it was, and I accepted it was.

But what I would say is, since becoming Minister and since having signed this agreement, I do believe and accept there is a difference between consultation and engagement. I think that is quite important. So I have been talking a lot about a trade policy strategy refresh that we are working through now, and that is very much about trying to engage as well as consult. With members of this House, I would be very keen to find better ways to do this going forward. But, I do believe that even if we had engaged differently, consulted differently—it would have been hard to consult more, but if we had done that—I do not think we would have had a different outcome, or would have come to this House with a different agreement than the TPPA, because I do believe it delivers for us.

We heard Ms Woods say that dairy was a big loser in this, and, yes, it is fair to say—

💬 Dr Megan Woods: I said it wasn’t a big winner. Not a big winner.

Well, if it was not a big winner, that is almost the same, I guess, as saying it is a big loser, as others have. However, all right. I will accept, therefore, that the All Blacks were not big winners the other day when they played rugby, but in this instance, I think, dairy did do very well.

Yes, it is correct that we did not get full liberalisation of dairy access to other countries. It is also correct that we got lower tariff rates and new quotas into a number of those countries, which means that we do have better access now than we did in the past, and we do have the ability in the future to keep challenging and looking for more from this at some stage in the future with our trading partners. However, dairy is one of the most heavily protected industries in the world—it is certainly very heavily subsidised—and New Zealand always goes to argue for a fairer deal for our farmers into these markets.

Of current trade volumes or flows, by value, into Trans-Pacific Partnership (TPP) nations, when fully enforced, there will be a $274 million tariff saving. Dairy is almost $100 million of that, and, actually, to our dairy farmers, that will be quite welcome. Is that enough? Do we think people should continue to liberalise? Do we actually want to see less protection of dairy around the world? Absolutely, we do. Do we believe there should be less—if not, no—subsidy in dairy and other agricultural products around the world? Absolutely we do, and we go and argue that in our free-trade agreement negotiations, we argue that in the World Trade Organization. But an almost $100 million saving for dairy on current trade values is, I think, significant.

But what we also see in the TPP are some areas where there was full liberalisation around dairy—not as a commodity, but as a product where we add value. So into the US, for instance, if you want to sell cheese or add value to milk products here—a little bit of sugar, some flavour, or maybe some kiwifruit, and you want to sell it to the US as ice cream—in many areas there is full liberalisation, and so there are opportunities for New Zealand to add value to products here and export them overseas, creating and protecting more jobs in New Zealand and actually growing our share of trade. A total of $274 million of tariff savings on our current trade values, not taking into account any extra trade that we will do as a result of this—that is a win for New Zealand, and it is a big win. I think those tariff savings will be greater because, in many cases, we will end up selling much, much more.

I will take a call later in this discussion to go into more detail, but I just want to address something that Mrs King said. I think it is very important—and we have paid a lot of attention to patent term extensions. She is correct that if we had to extend patents automatically or just because other countries wanted us to, there would be a cost to New Zealand. But in the text from the regulatory impact statement that she read—she was probably a touch selective in that, because if she went on a bit further it does show that the Government has been consistently clear that the patent term extension provisions of the TPP are likely to have a very limited impact in New Zealand. This is because the Intellectual Property Office of New Zealand and Medsafe are already very efficient—among the most efficient regulators in the TPP. So what this means is if there is an unreasonable delay, then that period of delay that is unreasonable can be tagged on to the end by way of an extension, and—

💬 Grant Robertson: How do you define that?

—the analysis says that is not likely to happen very much at all. So how that will be defined is that Pharmac can go away, do some work, and it will set some regulations around this. But, ultimately, we have agreed that because it was important to some of our other partners. But there will be TPP countries where the delays are very, very long—many, many years long. So, for reasons of transparency and fairness this was agreed, but the impact upon New Zealand will be negligible and, indeed, I think Pharmac has said it will be about a million dollars a year, including some of the work it has to do to comply.

A final part in this is what Mr Tabuteau said around other parts of Pharmac and what it would do. Well, Pharmac has said that in as far as—there are only two changes to Pharmac. There will have to be a review process for any declined application. There is not a problem with that because, actually, just as people took a case to the Waitangi Tribunal to make sure that the Government was meeting its obligations to iwi, to Māori, under the TPP exclusion, it is right that if something is declined there is the opportunity for judicial review. The only other change is that Pharmac can set the time frame in which it will make a decision, and it is currently consulting on this and proposing 3 years; so it can make a decision over 3 years. If it is turned down, somebody can appeal the decline, but there is no need for it—

I rise to speak on the Trans-Pacific Partnership Agreement Amendment Bill, and I would like to address the amendments to the legislation through, initially, an economics perspective. I think we have heard some generalities about this agreement and some assurances that I think are sadly lacking in terms of any rigorous analysis. In particular, I think the national interest assessment undertaken by the Ministry of Foreign Affairs and Trade (MFAT) was rather like giving the fox the keys to the hen house. Of course, the Ministry of Foreign Affairs and Trade would attempt to undertake an analysis that justified its negotiating position, and I think it is about time we started having some more objective analyses of these international treaties.

The economics of the Trans-Pacific Partnership agreement (TPPA) primarily rest on some very dubious assumptions. Those assumptions have been critiqued by the US Government in its International Trade Commission report, which directly criticised the modelling undertaken for the New Zealand analysis. They have been criticised by the Tufts report, from Tufts University, and by expert research in New Zealand published on the Trans-Pacific Partnership (TPP) legal website. The analysis by MFAT showed relatively modest economic benefits. The benefits were 0.9 percent of gross national product, which would be increased by the year 2030. By then, without the TPPA, gross national product was projected to have risen by 47 percent. So we are talking about the difference between 47 percent and 47.9 percent, which is a relatively small differential.

It calls into question the analysis, where on one side there were these relatively limited benefits and the other side there were completely unquantified costs and risks associated with many of the other obligations under the TPPA. But even that analysis of 0.9 percent by 2030 was grossly exaggerated. Only a quarter of that actually resulted from the tariff reductions that the Minister has just referred to. Those tariff reductions are real and there will be a benefit to some exporters, but, unfortunately, the effects have been grossly exaggerated.

Most of the benefits cited in the Government’s figure of $2.7 billion relate to non-tariff barriers. Over 60 percent of the economic benefits are from non-tariff barriers, and if we look at what these non-tariff barriers are, it is not clear as to whether these non-tariff barriers are actually legitimate regulations or whether in fact they are illegal barriers to trade, or barriers to trade that one would want to remove. There is no analysis between whether or not they are legitimate or otherwise. That is one of the reasons why the International Trade Commission—the US Government’s report—excluded those benefits. However, they were included in the New Zealand analysis and, at over 60 percent of the benefits, that was most of the economic benefit that was derived.

So if we then look at the effects of the economic analysis. Colleagues have previously referred to the Tufts University report, which showed that the modest amount of economic benefits would actually be associated with a drop in employment and a rise in inequality. These are accompanied also by additional costs that are the subject of the legislation—the amendments that we are talking about here tonight—costs of copyright, patents, and consumer costs from higher consumer prices.

One of the things that the TPPA should have taught us by now is, firstly, the problems with 7 years of secrecy in negotiations, where there was not adequate consultation during the negotiations on some of the important aspects that have come to light only afterwards. Secondly, what the analysis has shown us is the importance of objective research to be able to inform negotiations, particularly around areas of agriculture. Overall, the export benefits for New Zealand, in terms of additional exports to the countries that we export to—it is an average of a 2.2 percent increase. If we look at that 2.2 percent, it is significantly less than average monthly movements in the New Zealand exchange rates. It is significantly less than many movements on the Global Dairy Trade index. So an increase in benefits to New Zealand farmers of 2.2 percent is not going to drive production behaviour especially in the face of many other uncertainties.

Against this, there are the costs to the New Zealand economy. As has been referred to, the TPPA is not an agreement that is primarily about tariffs and quotas; it is an agreement primarily about the rights of Government to regulate in the internal economy. Significantly, it gives rights to foreign investors in many areas that are prejudicial to competitors in New Zealand. The TPPA will particularly harm small to medium sized enterprises (SMEs) that are struggling to survive against their multinational competitors, which often benefit from tax havens, and which often benefit from a lack of international competition policy. The New Zealand SMEs that are struggling to compete internationally with a flood of imports in many of their products now face enhanced difficulties in their competitive challenge.

One of those mechanisms is the investor-State dispute settlement (ISDS) mechanism, which allows foreign investors to take cases against the New Zealand Government over regulatory measures that might adversely affect the profits of those investors. I shall come back and talk a little bit more about ISDS related to the regulation tonight.

I want to talk a bit more about the agricultural trade implications. The TPPA has focused on reducing tariffs, and if we look at the dairy sector this is not a gold-standard agreement. The aims for this agreement fell well short. In fact, what happened was that because they fell well short, we have locked in artificially high tariffs in the dairy sector, which are way higher than the average tariffs for most goods traded internationally.

The second thing that we have done is we have ignored the major trade distortions. The major trade distortions affecting agricultural trade are not tariffs; they are primarily the subsidies that large agricultural producers receive, particularly in the United States, the European Union, and Canada. If we look at the level of agricultural subsidies in the United States, for example, the Congressional Budget Office estimates that the 2014 farm bill in the United States might account for US$1 trillion of subsidies over a 10-year period. Furthermore, dairy producers in the United States will be able to receive subsidies of up to 40 percent of their production costs. At a time of volatility in dairy prices, that vastly outweighs the measures that are addressed under the TPPA in terms of tariffs.

What has the TPPA done about removing those agricultural subsidies? Absolutely nothing. The difficulty here is that the only way those agricultural subsidies are going to be removed is through multilateral negotiations in the World Trade Organization (WTO). So immediately after signing the TPPA, the United States entered the WTO negotiations and said that it would like to end the negotiations within the WTO, including on agriculture.

This agreement is not in the strategic interests of the New Zealand dairy farmers. This agreement has many flaws in it, and I will come back to talk a little bit more about the costs at a later date. Thank you.

I am pleased to take a call in the Committee stage of this bill. It has really been a very troublesome period in New Zealand history. Much of that is actually down to the awful process that has led to the bill’s gestation and coming to this House, and the awful process that was driven by this Government.

I would like to start, though, by giving the Minister in the chair, the Hon Todd McClay, a bit of a tick for—it is a bit late—his acknowledgment of the importance of engaging with the New Zealand community and actually listening to them. The problem is that it is a bit of an “after the horse has bolted” situation, but at least he does seem to have a different approach as the trade Minister, and, hopefully, that will lead to a less divisive situation in our country in future. But that is about all of the tick that I would give to the Government on this.

I have a couple of points to make first, and they will be made over and over again on this side of the Chamber by the Labour Party. The Labour Party is the party of free trade. We have always sought to deliver the benefits of free trade to New Zealand and to reduce the barriers to growth for our firms and for the workforce, but this deal is an example of how a Government did not trust the New Zealand people, did not talk to the New Zealand people, and instead chose to negotiate the deal in secret and to exclude the New Zealand people. That lack of trust and that, I guess, ultimate approach of being out of touch has helped contribute to where we are at now.

We are also in a situation of great farce because we are debating a bill in the Committee that gives effect to something that we have already signed. The second reason it is a farce is that we have a US election and we have two candidates who do not support the Trans-Pacific Partnership agreement (TPPA), and so who knows what is going to happen next. This is likely to all be a complete waste of time. It is also a farce because we traded away things that we should not have traded away, for very little gain. I think pretty much everyone in New Zealand acknowledges that. There remains a lot of distrust in the community, with 39 percent of exporting small businesses supporting the TPPA, says Mind Your Own Business in its 2016 survey of a thousand small businesses. That is very disappointing for the Government.

The Minister of Trade, in his contribution before in the Committee, talked about how this is about services. Yes, it is about services, and a lot of the services and the future of this country lie in its ability to innovate and in its ability to protect its own intellectual property. A lot of that is in software development in the tech industry, and it feels as if this agreement got negotiated on a wavelength that was very much rooted in the past. I hope that this is what the Minister is learning as he is going around the country talking to the likes of NZRise that represent some of the innovation companies that are New Zealand - based. We need to protect them and ensure that we are enabling them to have the best possible start so that they can build our economic development, but, unfortunately, that is not what happened.

The Labour Party supports Gareth Hughes’ Supplementary Order Paper 240, which is the insertion of the “fair use” amendment, which he also has as a member’s bill. I want to say that this is not only sensible; it is actually playing catch up with the major partner that we are trading with and negotiating this TPPA with, which is the US—which already actually includes fair use in its copyright law. In the explanatory note of his amendment, it says that this bill “extends and introduces United States-styled copyright terms without the corresponding United States-styled fair use copyright protections.” Just so people know what the definition of “fair use” is—the basis of which is in US copyright law—it is “the doctrine that brief excerpts of copyright material may, under certain circumstances, be quoted verbatim for purposes such as criticism, news reporting, teaching, and research, without the need for permission for or payment from the copyright holder.” This is not something that we should be arguing about. It is something that should just be sensibly included.

I want to refer to a report that came out of the University of Auckland written by Louise Longdin just over a decade ago, which talked about the Statute of Ann—and I am sure everyone in this Committee knows what the Statute of Ann is—and said: “Ever since copyright was conferred on authors by the Statute of Ann in 1709 for ‘the encouragement of learning’, one issue in particular has troubled and divided the world’s trading nations. This is the problem of how to fairly balance the interests of creators and owners of copyright material against the needs of those who wish to use and build on that material (or maybe even just parody or criticise it).”

Another quote from this report—and this goes to the importance of supporting the innovation economy in New Zealand—and this is a quote from Justice H Laddie, says: “The whole of human development is derivative. We stand on the shoulders of the scientists, artists and craftsmen who precede us. We borrow and develop what they have done: not necessarily as parasites, but simply as the next generation. It is at the heart of what we know as progress. [B]orrowing and developing have always been acceptable.” But one of the things this bill does is that it extends the term of copyright from 50 years to 70 years without any corresponding fairness and balance that acknowledges the digital environment on which our future economy needs to be based, and it trades away something of which we do not get anything back. We are poorer as a nation for that, and my concern is that when this deal was negotiated, there were people who did the negotiating who did not seem to get that. I hope that as the Minister is going around the country talking to people—and I hope that he is talking genuinely to communities of interest in all parts of New Zealand and in all industries, in our universities, and talking with our researchers, with our librarians, and with our teachers—he understands just what the importance of that is.

Although this amendment by Gareth Hughes is not the most major thing that has come before the Committee, it actually would be a step forward. It would be an acknowledgment to the people of New Zealand that there has been a shift in thinking and that there is the ability for the Government to acknowledge that perhaps it could have done things a bit differently. And perhaps it would rebuild some trust between the communities that were so upset and anti about the lack of acknowledgment of their views, and it might rebuild some trust back in that direction.

Tēnā koe, Mr Chair. Tēnā koutou katoa ko tēnei pō. I will just take a short call. I just want to lay down a couple of issues around this bill because, as others have said, it is technically obscure. I am sure the people tonight listening to it would like us to talk in a way that is comprehensible, just because the Trans-Pacific Partnership agreement (TPPA) itself has been obscure for many people. I went to a number of briefings where I came away none the wiser—because there is a lot of rhetoric and there is a lot of promotion and there is a lot of jargon, but, actually, there is not a lot of common sense and clarity.

I want to focus on one particular aspect of this, which, I think, is most disturbing and which we have an experience of in other countries that we should learn from. It also irritates me when everyone says that we are “pro - free trade”—as if there is no such thing as fair trade. The Green Party believes that trading is an inevitable and important human activity that has always and will always take place. Communities of all sizes have always traded. That is one of the critical ways in which we interact. It is not rocket science, and it can be fair. Free trade is the myth. There is nothing free about privileging corporations over community rights—it is not free. It is a misnomer, just like the TPPA is not a trade deal; it is an investment deal. It would do the public a service if we actually talked about things in an honest way, and actually talked about the need for fairness. I do not know whether anyone in this Committee wants to deny it, but some corporations own more than the economy of this entire country, and have enormous powers. Why would we privilege them over the needs and rights of citizens?

💬 Marama Fox: Any more than they already are.

Any more than they already are, as Marama Fox says. It is already an unequal playing field. One of the ways in which this is played out in this bill—and I am going to talk about the bill; fear not—is investor-State dispute settlement, which Barry Coates began to talk about. I want to talk about one example of why we are opposed to the TPPA and this provision, which our Government has been adamant in including. That is the experience of other trade deals in other countries.

Take, for example, the company known as OceanaGold, which owns the Waihī mines—the Martha Hill pit and the mines underneath people’s homes in Waihī. It has owned other mines, particularly in Reefton, in Aotearoa New Zealand. It tried to sue El Salvador for $301 million recently in a trade court. It lost, but guess what? It took 7 years: 7 years when the El Salvador Government—not the wealthiest Government in the world—had to defend its people’s right to object to gold mining polluting their water. It cost their Government $12 million. It will be compensated for some of it, but it cost it more than the money: it cost it a whole lot of energy, time, and sovereignty rights in defending in a trade court. And what is a trade court? Who are these people? They are not lawyers. They are not people’s representatives. They are not citizens. They are trade courts. I am fascinated by how they can invent these things, these mechanisms, through the World Trade Organization, etc. to suit the purposes of the corporates. It just happens to be this time that El Salvador won and OceanaGold—not my favourite company, because it is ruining my area and has ruined other areas—actually managed to lose this case.

There was something that has been described by, for example, Marcos Orellana of the Centre for International Environmental Law. I think it is important to quote, because this is what investor-State dispute settlement does. It is not a game. It is not a picnic. It is not something that countries need to waste their energy on, but these deals impose it. He said: “Regardless of the outcome, the arbitration has had a chilling effect on the development and implementation of public policy necessary to protect the environment and the human right to water.” That is how basic this is: the human right to water. Fair trade would protect the human right to water. Free trade, which is free only for the corporates, does the exact opposite. What matters in this world—[Bell rung] Mr Chair?

The CHAIRPERSON (Hon Chester Borrows): Catherine Delahunty.

I will not take a full call, but I will finish my sentence. What matters in this world is water. If the corporates get control of these things, even more than they already have, this country will become yet another casualty, as El Salvador may well still be, despite winning in this obscure trade court.

I just want to briefly touch on the ideology behind the TPPA in this bill—I acknowledge that there have been some useful Supplementary Order Papers put up to help modify the impact—and one ideology is the fantasy world that the economy is more important than people. Free trade is riddled with this fantasy. The economy is more than a person! It is a giant person, who sometimes has a bad day—the economy had a bad day! The economy was struggling; the economy needed help! We give the economy this enormous power over people, and give it more validity than people, because otherwise the economy might become unstable. We do not control the economy; it does not work for us. We need these trade deals because the economy is so important and powerful and huge that we cannot break it down and recognise that it is about people and their rights to trade fairly.

That is what I object to about the TPPA. It pretends that these investments are going to benefit people who cannot and have not been able to maintain their rights to trade fairly. The economy, my friends, is just a subset and a tool of human beings’ right to live sustainably on the planet with each other and with the environment. These deals undermine that right and put the economy as if it were a super-god—a superhuman force that cannot be allowed to have a bad day.

We are opposing this bill because we believe that the economy should work for the people and trade deals should be fair. We believe that it is more than possible to design rules and regulations that are fair, that acknowledge Te Tiriti o Waitangi as a fundamental issue of sovereignty, and that will acknowledge the rights of citizens to determine their own relationship with the environment, to protect your own services and goods, and to maintain the privilege of living in your own country and saying that you will be considered first, rather than some multinational. But I can understand why we are not considered first, because the economy is God, and so the economy must be free! But the people do not get fairness when the economy is God, and that is the problem. We are modelling ourselves, supposedly, on a model that is failing people all over the world. Why do you think—sorry, Mr Chair. Why do people think—

The CHAIRPERSON (Hon Chester Borrows): I do think.

—that there are massive protests in every country? Because we are all stupid, all of us who protested? Some of us have been doing this since the Multilateral Agreement on Investment, which failed and fell over because of confusion, public objection, and brilliant campaigning by some people. We will persist. The TPPA has not been won yet, no matter what game the New Zealand Government thinks it is playing. Globally, including in the United States of America, as I speak, people are opposing this. Many, many people have doubts that their own ability to trade fairly will be upheld by this deal. So talk as much as they like, we do not trust it, and why do we not trust it? It is because we have had this fantasy game going on for quite a few years now, and we are still living in a world of gross inequality, gross environmental degradation, and increasing unrest. The plan is not working, the economy is not God, and the TPPA is not what we need. Kia ora tātou katoa.

It is my great pleasure to take a call on this, the Trans-Pacific Partnership Agreement Amendment Bill. Can I acknowledge the Minister in the chair, Todd McClay, and can I open by saying that I would like to acknowledge the Hon Tim Groser and the role that he had in delivering this free-trade agreement. I also want to acknowledge the advisers and our head negotiator, David, ah—

💬 Hon Todd McClay: Walker.

—Walker, sorry. Thank you, Minister. I want to highlight one point. Former Minister Groser has copped a bit of criticism in the Committee tonight around transparency and around consultation. I just want to say that I remember when we were hearing submissions at the first go-around with the treaty. We had the trade unions come in to the Foreign Affairs, Defence and Trade Committee, and one of the things that they raised and were quite upset about was that there was no consultation. Of course, there was a fair bit of public debate going on about that and we were trying to listen very closely to it, but, on closer questioning, it actually turned out that there had been a fair bit of consultation and that the trade unions had actually been given three meetings with the negotiators and with the Minister to discuss what was in the free-trade agreement. That was a trend that continued throughout the process. I just want to set the record straight a little bit, in terms of former Minister Groser and the work that was done around consultation.

I do, however, want to acknowledge Minister McClay, because on taking over the role as our Minister of Trade, he embarked—it was very clear, I feel, that we had listened, and there were genuine concerns in the community about the lack of consultation and transparency around the agreement—on a series of over 50 public meetings around the country. He took other senior Ministers with him. He took David Walker and our officials who had been dealing with the free-trade agreement, and he embarked on a very comprehensive programme of public meetings.

I think the best way to highlight the effect that these public meetings had is to talk about the number of submissions that were received on our first go-around with the treaty, and then the number of submissions that we received when we actually had the legislation come to the Foreign Affairs, Defence and Trade Committee. In the first go-around, when the committee went out and asked for submissions in relation to the treaty, it received over 10,000 submissions. Admittedly, many of those were pro forma submissions, but it received over 10,000. When we went back out and asked the submitters as to who would like to actually come in front of the committee and make an oral submission, we had about 300 people come back and say that they would like to make an oral submission to the committee. We went to Auckland, we heard submissions in Wellington, and we travelled to Christchurch in the South Island, to make sure that everyone had easy access to the committee.

I want to acknowledge the committee. I would like to acknowledge David Shearer and David Clark from the Labour Party, Dr Kennedy Graham from the Green Party, and Fletcher Tabuteau from New Zealand First. On the Government side of the committee, we had Shane Reti, Lindsay Tisch, Todd Muller, Jami-Lee Ross, and David Bennett. Although it was very obvious that the Labour, Green, and New Zealand First members had taken a position against the agreement, and that, of course, the Government members were in support of it, I have to say that the committee decided right from the get-go that submitters who were coming in front of the committee would be listened to very, very carefully, that their issues would be recorded, and that we would address those with our advisers. That was a process that worked very, very well. I want to acknowledge the whole committee, which came together and worked in a spirit of making sure that the submitters were heard and that their issues were addressed. I am not a cynic—some people would say that that was just purely part of the process. Yes, it was part of the process, but it was an important part of the process in terms of giving people an ability to raise their concerns and have their say.

I just want to address one issue that was raised—I think it was by Dr Megan Woods—and that was around Pharmac. Yes, in relation to Pharmac, there are some additional costs. For a programme that is funded at about $800 million and growing—and I do not have all the details in front of me; I may need to be corrected, and the Minister can do that if so—from memory, the only real change to the Pharmac model is that there is allowed to be an additional review asked for inside the model. That meant that, basically, we had to budget around $2 million as a one-off cost up front. When you think about the size of the actual programme—over $800 million annually—that is a very, very small and insignificant cost. It does not change the Pharmac model in itself, at all.

I would just say too that in relation to support for the Trans-Pacific Partnership (TPP), of course we are all watching with bated breath to see the results of the American elections. I would have to say that in the House tonight it has been stated that Senator Clinton has taken a position against the TPP. That is not entirely true. She has actually stated that they would have a fresh look at it. However, it is true—and I do agree with the Opposition members—that Mr Trump’s policy in relation to the TPP is very closely aligned to the Labour policy on the TPP.

The only other point that I would make is that there has been some support for the Trans-Pacific Partnership from the Opposition parties—from highly respected leaders within the Labour Party—and that is, of course, the Rt Hon Helen Clark and the Rt Hon Mike Moore, both of whom have come out publicly and very clearly in strong support of the TPP. So it is with great pleasure that I stand and support, in this Committee, the Trans-Pacific Partnership agreement. Thank you.

I am pleased to speak in opposition to this bill at this Committee stage. I do so as a proud member of the Labour Party, which is the original party for free trade. But this bill is not a trade deal.

💬 David Bennett: Tell us another lie.

It is not. It is not a trade deal, because this Trans-Pacific Partnership agreement (TPPA)—what does it do? It works in favour of the American multinational pharmaceutical companies. It works in favour of Silicon Valley technology companies. It works in favour of Japanese manufacturers. But it does not work for New Zealanders. Sure, there are benefits that we may have in the primary sector that we are seeing, but we have not had a full, proper analysis to really have a full assessment of the impacts of this agreement on New Zealanders as a whole. That is why we are opposing it.

Sure, if we look at it, protected dairy markets are still largely intact as a result of this, and yet it was lauded at the time that this would be a breakthrough deal for our dairy industry—our world-leading dairy industry. Well, that is not so much the case—not so much the case.

But I really want to shift the focus of my contribution at this time to look at the impacts of the TPPA on Māori, and in particular, on that groundbreaking Waitangi Tribunal report that was Ko Aotearoa Tēnei, into the Wai 262 claim. That was a groundbreaking claim all about the place of Māori culture and identity and traditional knowledge and its recognition within New Zealand laws. It covered big questions about who controls traditional knowledge and who controls artistic and cultural works—for instance, our haka, our waiata; our culture. Who controls the environment that created our culture, and that emerged from the natural environment? Those are big issues to Māoridom—big issues—and it took 20 years from 1991, when the original claim was lodged, through to 2011 for the Waitangi Tribunal to issue its landmark report, a whole-of-Government report, the first of its kind, where it looked into and made strong recommendations in this whole area. This is the real concern that Māoridom has: that by signing away this TPPA, we are losing control, even more control, over our taonga—and this is what it gets back to, our taonga—which is there in the Treaty that was signed. That was the basis of Wai 262. The fear for Māoridom is that we will lose even more control of this by signing away our rights in this TPPA.

I would like to give an example of that, because within the TPPA there is an obligation on New Zealand under Annex 18-A: Annex to Article 18.7.2 to either adopt the International Convention for the Protection of New Varieties of Plants or legislate for our own rights system that gives effect to that convention. That obligation could be very problematic to Māori, and yet we are getting no clear signal from the Government whatsoever as to what its plans are as to how we will give expression to that. The Government needs to be more up front, and that is what Māori are concerned about. It needs to be more up front so that we know exactly what that entails.

This goes to the point of ratification. Why is this Government racing—wanting to dive headfirst—into ratification of this agreement when these very important side issues have not been cleared off? The Government has not been up front with iwi Māori katoa as to what it intends to do around how we implement our obligation to this. I note there is the Treaty of Waitangi exemption, and it is the standard, boilerplate provision that is in there. But, again, words can mean a lot of things, but these are obligations that we apply.

I would just like to give an example. What say a Mexican cigarette manufacturer wants to put my ancestors’ tā moko on that company’s cigarette packets? What is to stop them from trying to make money off my tīpuna and off our collective cultural intellectual property (IP)? What will our Government do? If our Government tries to move in, to step in to try to—what will our Government do to try to protect our IP in that situation? How will the Treaty of Waitangi exemption apply in that scenario? Will we be hauled before some secretive international tribunal whereby another foreign State can lay claim against us for them being denied the ability to make money off our IP? I mean, these are serious questions that are of deep concern to Māori. The Government has not made the case. It has not made a clear case, and it has not been up front as to how it will protect our cultural IP in these matters, when it has already signed away its obligation to ratify and implement or, indeed, put in place its own regime. I certainly hope that the Government will be doing something that is accommodating of Māori concerns and that, in fact, aligns with its Treaty of Waitangi obligations.

But again, we have heard nothing from this Government on these matters—complete silence. Sure, it might be buying a little bit of time to try to implement these obligations that are imposed on it now that it has signed away and is wanting to ratify this agreement. But, again, it is of deep concern to Māori, to ngā iwi katoa, and I think it should be of deep concern to our whole country. We do not know the impacts that this will have on our cultural IP, and that Wai 262 claim is still sitting with this Government. It has done nothing on it. The Government has been sitting on it for close to 5 years, and in the meantime it has been rushing aside, trying to go behind secret doors, in complete secrecy, to ram through this deal, when that Waitangi Tribunal decision, recommendation, and report has just been sitting there, and ngā iwi katoa are waiting. We are still waiting. We want a response. We are deeply concerned at what this Government will be doing and the impacts that it will have.

As I have said before, Māori are very well aware of signing things when things can go very, very wrong. We are all too aware of the loss of our sovereignty, of losing what we think we have, when a piece of paper is put in front of us. That is why Māori are very concerned about the TPPA. Sure, there might be other positive parts to it. I do support those. Anyone wants to support things that will help our primary sectors, our productive sectors. But we need to have the full picture, as to what the implications are on copyright, on IP, and on cultural IP, especially in light of the Wai 262 report.

I was speaking to the daughter of one of the original claimants over the weekend. They are deeply concerned that the Government has done nothing around Wai 262 and yet it is rushing—rushing with all the gusto that it can muster—to ratify this deal, which we know is a redundant exercise because we do not know what is going to be happening tomorrow with the US elections. So why the rush? Why the rush? The agreement will not be coming into force until a couple of years from now, and that is provided all the countries that are a party to it ratify it. That is far from a certainty—far from a certainty. We should not be rushing this. We should not be rushing this. There are far too many very important issues to iwi Māori. The foreshore and seabed was a lesson for Labour, and I think Wai 262, the TPPA, and Māori cultural IP rights should be of concern to this Government. That is why I deeply oppose this bill. Kia ora.

Members, at the beginning of this debate, Grant Robertson queried whether the commencement date in the bill was in order. A commencement date must provide certainty about when the Act is to come into force. It may not rely on an indeterminate event. That is Speakers’ ruling 130/2. Clause 2 of the bill provides that it comes into force on the date appointed by the Governor-General by Order in Council. That is a relatively common method of providing for a commencement of an Act. However, it goes on to say that the date of the Order in Council must be the date on which the Trans-Pacific Partnership agreement (TPPA) enters into force for New Zealand. That is an unusual feature.

It is important that the House knows, when it is legislating, the determinate event that will cause a bill to come into force. The House must also ensure that, where a bill commences by Order in Council, the Executive Council knows when it must act. It does not seem to me that the event that would cause this bill to come into force lacks clarity. It is always possible that the TPPA or any other treaty will not come into force if member States do not agree with it. However, the bill provides that if the treaty does come into force, then the Order in Council bringing the bill into force must name the same date for commencement. The commencement provisions, in my view, make it clear what event would cause the bill to come into force, but not whether it will come into force. That is a matter somewhat beyond the control of this House. I am satisfied that the current commencement date does not infringe against Speakers’ ruling 130/2.

As I noted earlier, the commencement date is already part of the bill, recommended by the Foreign Affairs, Defence and Trade Committee and agreed by the House at the second reading. Although this Committee could amend the commencement date and I could rule on the relevance of an amendment, it is not within the power of the Chairperson to rule out of order something already agreed to by the House. However, for the reasons I have just given, that is not a course of action that needs to be contemplated.

E Te Māngai o Te Whare, tēnā koe. Thank you, Mr Chair, for that clarification. But I guess it is like a lot of things in this bill: it gives the executive greater power than the power of the Parliament, and I will come to talking about that in a moment, in terms of the changes to the Overseas Investment Act.

Before Mark Mitchell spoke, it seemed obvious that the National backbenchers were stuck like limpets to their seats and really unwilling to rise and defend this bill, given the huge public opposition to it and the opposition from this side of the Chamber. I think it is a bit rich now that the Minister, the Hon Todd McClay, is conducting a trade refresh with businesses, iwi, and the public, because it is rather too late to be consulting about the Trans-Pacific Partnership agreement (TPPA) and trying to restore the faith of the community in the Government’s negotiations of trade agreements when we have this bill before the House and when the whole process of negotiating the TPPA has been so mired in excessive secrecy both by officials and the commercial side.

The public has not been allowed to see the text until very, very late in the process. It was a 6,000 page text. The submitters got very little time to consider it before the date for closure of submissions. That whole process within the select committee, for deliberating on the bill, was truncated by about a month. We have had a very different process here in Aotearoa New Zealand than that which has existed overseas in places like Canada, where there is much more extensive public consultation and public engagement on trade agreements.

It is the Green Party’s view that there should be a non-binding referendum on the TPP and that we should engage the public and not have the executive able to negotiate these agreements without actually having the Parliament even able to consider them and consider whether they should be signed. This bill is making changes to legislation. The Parliament has not had a chance to express itself, other than by the select committee report, on the actual agreement itself, and to veto the executive or engage in that debate there.

This is a noxious bill. As my colleague Barry Coates described, the Government has gone after it because it believes that the economic benefits from it are substantial, but the analysis that has been done has shown that it is within the margin of error in terms of any economic benefits within the normal flux of the economy. So it is not guaranteed to deliver the claimed benefits that the Government talks about.

One of the major disadvantages of the agreement, of course, is the investor-State dispute settlement provisions, because in this agreement, supposedly about trade, only six of its 27 chapters deal with tariffs. The bulk of it is actually dealing with investor rights, and it is those investor rights that will fetter the ability of the Government to actually pass legislation to protect New Zealand’s interests. The Government has gone into this talking about economic interests, but it has been prepared to put second the ability of the Parliament to regulate and the ability of the Parliament to legislate on behalf of all New Zealanders, because it is allowing, through these investor-State dispute settlement provisions, for private corporations to sue the Government, to pre-empt a judicial process, and to have huge corporations taking on our small Government.

Of the hundred largest economies, 50 are countries and 50 are corporations. New Zealand is 364th in that list. We are 54th amongst Governments. So when private corporations seek to sue the New Zealand Government, as companies like Chevron have done when the state of Quebec decided that it did not want any more gas fracking—the oil company Chevron sued the Canadian Government for almost $400 million. Similarly, in Ecuador, Chevron used the investor-State dispute settlement provisions to try to get out of a previous ruling that that Government had put in place to stop Chevron polluting the Ecuadorian environment.

So it is this undermining of national sovereignty, the undermining of the power of Parliament, that is at the heart of the Green Party’s opposition to this bill. The bill will allow foreign corporations to seek compensation from the Government if they see things like mining legislation, things like biodiversity standards, things like controls on land use to protect water quality undermining their rights and their investment certainty. It is going to have a chilling effect, potentially, on the Parliament.

One of the other major reasons for the Green Party’s opposition is the changes in the bill around the Overseas Investment Act in Part 7. Again, this is where the executive is giving itself the power to amend the threshold that triggers the Overseas Investment Office to look at private corporations seeking to purchase New Zealand companies and getting involved in the New Zealand economy. Under the TPPA, there is a requirement that the Government double the threshold from $100 million in the current legislation, which triggers the scrutiny of the Overseas Investment Office, to $200 million, but the bill, in Part 7, allows the Government to pass regulations to change that investment threshold at the say-so of the executive. So that is having subsidiary, secondary legislation power done through regulation rather than through primary legislation that is debated by the Parliament. That, again, is reducing the sovereignty of Parliament. It is reducing our ability to protect our economy against foreign investment.

One of the other major weak provisions of the bill is that we cannot extend the categorisation of assets and land holdings that are subject to the Overseas Investment Act. That means that there is no ability for the Parliament to ensure that foreign speculators who are speculating in urban residential property can be controlled through a change to the Overseas Investment Act. The bill prevents that from happening. It is keeping the classes of transactions that are subject to the scrutiny of the Overseas Investment Office—it restricts those to what is already in the legislation. Again, it is a chilling of Parliament’s ability, a restriction on our national sovereignty, and a putting of the interests of foreign corporations ahead of the ability of the Parliament to act on behalf of all New Zealanders, to act on behalf of our economy.

It is the foreign corporates that win under this bill. It is the view of masses of New Zealanders who made submissions on the agreement that they oppose this bill. We oppose this bill. We want our Parliament to have sovereignty. We want our Parliament to be able to act on behalf of all New Zealanders to protect our environment and to protect our economy against overseas speculation and investment, but this Government is set on undermining that so that foreign corporations are much more able to sue and pursue their interests. The Green Party is opposed to this bad bill.

I want to start my contribution to this debate by talking about values, what I in particular value and what the Green Party values, and why I stood for the Green Party. What we value is a world where our climate and our environment is protected for the long term, where people are able to have meaningful work and able to live happy, healthy lives—a world where there is peace. This is not unrealistic. This is something that we could create. With all of our knowledge and our technology, human civilisation should be able to achieve this.

Trade could and should be part of achieving this, of protecting our environment and protecting people and achieving a peaceful civilisation, but it currently is not. Why is that? It is because along with trade has been exploitation of natural environments and the exploitation of poor people, all for the benefit of some very wealthy investors. It will continue to happen this way if we do not stand up and say that we want a better world. I know that most New Zealanders agree with this and would like to live in a peaceful world, would like to protect our natural environment, and would like to live in a society where everyone has a fair go and we do not have increasing inequality.

But the National Government is letting us down, not only because its policies are not achieving this but because it is not even facilitating an open and frank debate about its policies. The Trans-Pacific Partnership agreement (TPPA)—we have not had a proper debate about this, and any time anyone raises significant concerns about the provisions in the TPPA and how they are going to make it more difficult for us to protect our natural environment, to protect the public health of our people, and even to protect the interests of taxpayers when it comes to the cost of medicines, we are accused of being anti-trade. Well, let me say, right here, right now: I have no problem with trade. We believe in trade. We want trade agreements that protect the things that matter most to us in this world, and that is our children’s future, that is the water that they should be able to swim in and drink, that is the air that they breathe, and that is the climate that we need to be looking after.

I know that those National Government members understand this, because their Government signed up and ratified the Paris Agreement. The Paris Agreement says we cannot keep doing business as usual. We have to change how we are doing things. Yet the TPPA is very much about protecting business as usual.

Our three main concerns about the provisions in the TPPA are: the ISDS clauses—that is, the investor-State dispute settlement provisions, which give investors the right and ability to sue Governments simply because they have legislated in the interests of protecting the environment or public health. That is the truth of how these ISDS clauses work—70 percent of all the ISDS cases that have been taken have been about environmental regulation, and there are countless examples of these. For example, when the German Government tried to phase out nuclear power after the Fukushima disaster in Japan, it got sued for NZ$6.2 billion by a Swedish nuclear energy company. When the state of Quebec decided it did not want any more gas fracking, Chevron Oil Co. sued the Canadian Government for almost $400 million. Chevron Oil Co. also used ISDS to sue Ecuador because Chevron was trying to get out of a previous ruling that said it owed billions of dollars to Ecuador for polluting the Ecuadorian environment.

Anyone who cares about protecting the environment in the long term will have concerns about the provisions in the TPPA that are, effectively, giving foreign investors the right to potentially sue future New Zealand Governments for regulating in the interests of protecting our environment. I have not heard a single National member stand up and give any defence of this.

It is not just the environment. If we care about public health and the ability of future Governments to pay for medicines, then we should be concerned about the copyright provisions in the TPPA that could affect the ability of Pharmac to negotiate affordable prices for medicines. In fact, National has already admitted—John Key has already admitted—that it will cost us more. Maybe it will not cost New Zealanders more when they go to pay for it at the pharmacy, but it will cost New Zealand taxpayers more because we are going to have to pay more for those medicines.

How is that in the interests of New Zealand? It is definitely in the interests of the big pharmaceutical companies in the United States. They are some of the most profitable companies in the world; their margins are incredible. I am not saying that we should not be looking to get a better deal for our exporters—we absolutely should—but what we have got in the TPPA is simply not worth the cost, the way this trade agreement has been written.

It is not just the Green Party that is raising concerns about this. The EU Trade Commissioner—who is in the middle of negotiating the Transatlantic Trade and Investment Partnership (TTIP), which is an Atlantic version of the TPPA—said “We want the rule of law, not the rule of lawyers.”, and is calling for ISDS reform. The Australian Productivity Commission, set up by John Howard, recently came out strongly against investor-State dispute clauses because of the unquantifiable financial risks to Governments. It said ISDS creates “potentially large unfunded contingent liabilities dependent on decisions by international arbitration tribunals.”, “substantive appeal rights available to foreigners not available to domestic firms, risk impeding domestic regulatory reform … lack transparency and have inadequate parliamentary scrutiny.”

So the concerns that the Green Party has are not about trade—let that be clear—we are concerned about the ability of New Zealanders to use their democratic right to regulate to protect in the interests of the environment and in the interests of public health. I think that is a perfectly legitimate concern to raise, and it is a debate that should have been had here in New Zealand. We should have been talking about that. Not everyone who raises concerns about the way this has been drafted should be castigated as being completely anti-trade or against jobs in New Zealand. I mean, honestly. In the Government’s own analysis it shows that the TPPA is likely to lead to a loss of jobs in New Zealand.

So again what we see here is a pattern. That pattern is that law is being made in the interests of the few, in the interests of the powerful, and in the interests of those who are already benefiting from the status quo. We know we want something different and something better, and we have every ability to create that for ourselves. So for all the young people out there in Aotearoa who want a peaceful world with a stable climate and a fair society, I say to you: you can make a difference. Get involved in politics. Get involved and help us create this fairer society and better world, because these people in power are not going to do it for us.

I thought I would take another call on the discussion and the debate so far. I want to start where I started in the first call so that, actually, New Zealanders will genuinely be enjoying this conversation and debate. Largely that is because quite a lot of the politics around the Trans-Pacific Partnership (TPP) that we have seen over the last year is not present in the Committee, and I think that is a good thing when it comes to talking about trade and trade policy and the importance of trade for all New Zealanders. So I am grateful to all members, on both sides of the Chamber, for the way the discussion and debate have been conducted so far. I pledge to ensure that it is not me who changes that with my comments at the moment.

I would say to Ms Genter that I largely agree with some of the sentiments she has made, maybe not all of the detail, but I do also agree with her that it is important that we find ways to make the case to New Zealanders. Certainly, the process that we have seen—the treaty examination and also the legislation—in as far as the Foreign Affairs, Defence and Trade Committee has been, I think, important. The committee has done a very good job. It did receive a lot of submissions and did its very best to allow submitters as much time as it was able to. Indeed, in the first roadshow that I held around the TPP in Auckland, where there was a very large turnout—it might have been the largest turnout of the 18-odd roadshows and hui that we did, not the largest group that I spoke to as part of the 50-plus events I did around the country, but of the formal roadshows and hui, that would have been the largest one.

Ms Kelsey, from the floor, raised her concern that she would not meet the deadline imposed by the committee for submissions. Indeed, that would be a concern, but it was not because the information—the document—had not been available. For the first time the Trans-Pacific Partnership agreement (TPPA) was released before the legal scrub has taken place, soon after it was agreed and long in advance of the signature. Often, with other agreements, we have released it to the House after signature, and, indeed, the rough text was released last year, and then I released the scrubbed text before signature. But I said to Ms Kelsey at the time that she should get in touch with the chair. There was all of this year to have this conversation with New Zealanders and through the House—this is a place for scrutiny. We heard soon afterwards—it was a decision of the committee, but it happily extended the period of time for her and some others to make submissions. So I want to compliment the committee for its approach to this. I think it has been mature and I think it has helped, certainly in the sense of the debate here today.

I want to touch on a couple of issues that members have raised, and because this is one debate on all parts and sections and we are coming to a vote, I will also speak about a couple of the Supplementary Order Papers (SOPs). I want to explain why I think some of them are not necessary but some of the things they are trying to achieve will already be achieved, or there is another way. The first thing I would say is that Mr Tirikatene spoke earlier about Wai 262 and his concerns there. The Government shares his concerns, and that is why under the TPP we are the only country that has an exclusion to be able to make decisions around Wai 262, or at least the International Union for the Protection of New Varieties of Plants (UPOV) agreement, and implement that outside of TPP. So all other nations have made commitments and are bound by those—many of them have already signed up to UPOV or have implemented them—but, in the case of New Zealand, we have carved out space for that internal domestic dialogue to take place in many areas, including with iwi, before decisions are made.

We have had to say with our partners that we will put things in place within 3 years. Actually, to Mr Tirikatene, I think that is probably a good thing because it does give emphasis and momentum to the necessity of having this conversation, but it is also 3 years after entry into force. So—roughly, three plus two—the Government has 5 years to work through this. That is an area, as with the Treaty exemption, where we carve out the right for the New Zealand Government, the Crown, to meet its obligations to iwi, to Māori. That is something that we take seriously.

In all agreements, for a very long period of time—in fact, there was a previous Labour Government quite some time ago that consulted widely on the Treaty of Waitangi exemption, and it has been in all trade agreements since then. But I would say to members that it is not just accepted by countries overseas that we have a right in New Zealand and must, therefore, have a right in our agreements to meet our obligations to iwi—we have to go and explain this and negotiate it. We have been successful so far all of the time, but we should not take for granted that all of those whom we negotiate with would merely accept that. We have to work very hard for it. I have had six meetings with the iwi leaders and their trade group this year to talk about the TPP and to talk about trade. I am committed to continuing that conversation with them as we go forward. I would say that the dialogue we are having, again, is working very well for both sides.

Around investor-State dispute settlement (ISDS), I agree with the European trade commissioner as she wants to look for reforms to ISDS. TPP is one of those reforms. As far as ISDS is concerned, it is the most advanced investor-State protection system that we have successfully negotiated. I accept that people have different views on this and will not all agree with me but this is the first one where we have openness, we have transparency, the public can see what happens, and we have carve-outs for the Government. So the first area is that no tobacco company can take a case against New Zealand under ISDS. Secondly, we reserve the right to pass law and regulation. Thirdly, where two parties of countries disagree that an ISDS case—if they believe an ISDS case would go against the spirit of what has been negotiated, those two countries can decide to not allow it to go forward, to dismiss it. But it is very open, it is very transparent, and in future agreements I think we will continue to look for ways to make this more open, more transparent, and better for us as we can. But the reason we do this is not to allow others to come here to New Zealand, take issue, and seek legal redress in some way, it is so that New Zealand investors overseas can have greater certainty. Not every country of the world respects its courts or its law in the same way that New Zealand does. It is important that our investors know that there is a framework they can work within.

Finally, just around the SOPs—and I will go through these fairly quickly because I do not want to take another call and deprive members of an opportunity. There are a number. The first is from Gareth Hughes, SOP 240 on fair use. Some submitters requested that we introduce a fair-use exemption as part of the select committee’s process of the bill, and I think this is to do with copyright. As the departmental report said: “TPPA does not require New Zealand to introduce a ‘fair use’ exception into the Copyright Act. The introduction of a fair use exception is best considered within the context of a wider review of the Copyright Act.” If that review takes place and happens, it would be allowed and it would actually impact upon TPP. So the place to do this—I have this conversation not as part of TPP, just those 11 other countries—is in any wider review of the Copyright Act, and we have the space there for if domestic legislation changes for that also to impact upon TPP.

The second one from Barry Coates—this is SOP 241—would create a discrepancy between exceptions for copyright and exceptions for performers’ rights in sound recordings. My view is that this would lead to confusion and additional compliance costs for people wanting to use the exception in this area.

The final one, SOP 242—also from Mr Coates—is around the overseas investment SOP. Clause 69 is the power that will enable the part of TPP relating to overseas investment to be implemented. New Zealand cannot be compliant with its TPP obligations unless regulations are made or a new bill is passed. So the regulation-making power under clause 69 is clear on its face as to the limits of the power and the purpose of that power. It is limited to the implementation of the obligations under the TPP. So to limit it to $200 million as a threshold for business assets acquisition, it does not speak to sensitive purchases or sensitive land and so on. For this reason the Government does not consider that it is necessary—sorry, we consider it is not inappropriate to delegate to the executive the power to make detailed regulations that we need to meet this obligation. But the draft regulations, as proposed to be made under clause 69, are already open for consultation—that has been called for by the Minister—and it is intended to allow transparency input from the public. The regulations, once decided, would be subject to the usual scrutiny and the other powers of the Regulations Review Committee. As Miss Genter said earlier, it does not allow the amount of that threshold to go up; that is set in the TPPA. It merely is around the rules of how to implement it. So it does not mean the Government can say “Let us double it or triple it.” It is only to allow us to implement obligations under TPPA, and that is at the rate of $200 million.

Kia ora, Mr Chair. Ngā mihi nui ki a koutou, kia ora. You really know what grinds my gears? It is that Minister talking about, and I quote him, “openness”, “transparency”, and “we are having a conversation.” A conversation, after the thing has been negotiated; a conversation, openness, and transparency, after the thing has been decided. That Minister came down to this Chamber and said “What are you moaning about? You’ve had 50 roadshow meetings.”, after the thing was decided. He said to MPs and unions “You’ve had access to negotiators.”, after the negotiations had finished. You cannot have a conversation with someone who cannot budge, who will not budge.

This has been a terrible process, and here is the Minister trying to defend it by saying that it has all been about openness, transparency, and a conversation. That is absolutely ridiculous. This has been a secret process throughout a number of years. The only way citizens, unionists, businesses, and NGOs could find out information about what his team was negotiating was through WikiLeaks. That is not openness. That is not transparency. That is not a conversation. That is being dictated to.

This is a bad bill, which the Green Party will not be supporting. The Minister was talking about my amendment, and I want to touch on this. My amendment: a positive amendment for fair use. Under this legislation, we are being forced—

The CHAIRPERSON (Lindsay Tisch): Order! The member’s Supplementary Order Paper 240 is out of order. It is out of scope. I know you have been informed of that. So if could you confine your comments, as you have already started, to other substantive matters, but your Supplementary Order Paper (SOP) is out of order. I will be ruling it out of order when we come to have the vote, and you cannot talk about it because it is out of scope of the bill.

I raise a point of order, Mr Chairperson. I just seek clarification. I am aware of that fact, but why was the Minister not required, on mentioning my SOP—

The CHAIRPERSON (Lindsay Tisch): No, well, he actually just commented on your SOP. You are the one who is now speaking to it, and I am telling you now that it is out of scope. There are some very small technical agreements that are in scope, those required to implement the Trans-Pacific Partnership agreement (TPPA), but your amendment seeks to extend the copyright provisions to mirror American provisions. I know that you have been informed that it is out of scope. I am telling you that I will be ruling it out of scope when the vote comes, but I am also saying now that you cannot talk to it, because it is out of scope.

So under this legislation, under the copyright provisions of Part 2 of the Trans-Pacific Partnership Agreement Amendment Bill, New Zealand is forced to enact US-style copyright rules, US-style copyright term extensions. This legislation is all about New Zealanders facing US costs, with none of the US benefits that US citizens can access, such as modern copyright legislation. Because, currently, what this legislation does is keep our 1994 Copyright Act stuck in the past, stuck in the pre-internet age where it was written, in the early 1990s.

Under this legislation, New Zealand copyright has been moved towards the balance of rights holders. Everyone involved in the copyright debate, in New Zealand and around the world, agrees we need balance when it comes to copyright. However, what this bill does, in Part 2, is put all the balance on one side: on the rights holders’ side. When we see the impact this has on New Zealanders—I researched the impact it is going to have on New Zealand music and New Zealand literature, which would be coming out of copyright, but because this Government is extending terms along the US lines, with none of the corresponding US benefits or protections. We are going to see some iconic New Zealand literature such as New Zealand’s first gay novel, some incredibly famous music such as the song of the century, Fourmyula’s “Nature”, stay locked out of the public domain, which means New Zealanders cannot access it. We cannot have a richer creative public space, because it is being locked away.

This is exactly what we see in this legislation, which is all about balance that is tilted towards one side, which is the corporate interest, not the public interest. That is why we should be having the conversation. If we are having US costs, why can we not have US protections? This was a key message we saw in the select committee process. Although we are criticising the process that sees us at this point—which was the secrecy, being consulted on and engaged with only after nothing could change—we saw that exactly in the select committee process, which went through a very constrained time line and did not listen to the people.

Here we are in Parliament, racing ahead, passing a law literally on the eve of the US election where both major candidates have said they will not be supporting this legislation. New Zealand is racing ahead. It is disappointing that we cannot access those protections that other citizens can. The Green Party is going to continue to push for it, because as we had the copyright conversation we should be talking about balance, not just costs for New Zealanders, which we know have been estimated to be in the order of $55 million a year. Thank you.

Tēnā koe, Mr Chair. I would like to speak to Supplementary Order Paper 242 on the foreign investment provisions of the Trans-Pacific Partnership Agreement Amendment Bill. This Supplementary Order Paper proposes the deletion of clause 69. Clause 69 would insert a new section 61A, and that section would give powers to the executive that we believe should be reserved for Parliament. What it does, basically, is it takes away the powers of Parliament to determine the rules around foreign investment regulation. I think this is a particularly problematic part of the Trans-Pacific Partnership Agreement Amendment Bill. As previous speakers from the Green Party have discussed, the Green Party does not agree with the ratification of the Trans-Pacific Partnership agreement (TPPA) as a whole, but even if it went through we would be deeply worried at the loss of democratic and parliamentary scrutiny over the important issue of regulation of foreign investment.

There is, as members of the public and members of the House know, considerable public interest in Government approval of foreign investment, and growing public concern about foreign investment of New Zealand’s iconic landscapes, of agricultural land or primary production, of value chains, and of strategic assets. The foreign ownership of New Zealand’s assets is increasing, although we would decry the lack of proper analysis and a database to show that clearly. We believe it is wrong for democratic oversight of that investment to be taken away from parliamentary scrutiny under this amendment, so this Supplementary Order Paper proposes to delete the amendment that would remove these parliamentary powers.

Let us look at why we might want to have public and parliamentary scrutiny maintained over foreign investment in New Zealand. Members of the public know that there has been deep concern over foreign purchase of residential homes, for example. The right to restrict foreign investors from purchasing New Zealand residential homes would be, essentially, ruled out under the TPPA.

But there are many other aspects of foreign investors that give rise to concern. The journalist Rod Oram wrote, in an expert paper analysing the TPPA, about the loss of control of agricultural value chains. The problem is that if we cede control over value chains in, for example, infant formula to foreign investment and foreign ownership, then, essentially, New Zealand producers get locked into the role of low-value commodity production, without the means of owning the full value chain and without the ability to be able to strategically direct New Zealand’s future in agriculture value chains. This is a recipe for New Zealand to be locked into a low-value commodity - producing role in the economy.

There are many other reasons why foreign investment may want to be restricted. For example, in the episode when schedule 4 of the Crown Minerals Act was threatened to be opened up by the Government, there was concern from industry that that would be restricting foreign investment. Industry said that the value that was locked up was $200 billion—a figure then repeated by the New Zealand Government. So the “locking up”, so to speak, of mining assets that are, in fact, on conservation land could be the subject of challenges from foreign investors on the basis that it would restrict their access to New Zealand’s resources. That is exactly the kind of restriction that we think the New Zealand public needs to have a voice on to ensure—[Bell rung] Mr Speaker. Thank you—sorry, Mr Chair.

There have been debates also over strategic assets such as Auckland Airport. There is public concern over the use of New Zealand’s groundwater. There is public concern over the sale of agricultural land and iconic places. What we are seeing internationally is that agreements like the TPPA, which introduce a mechanism such as investor-State dispute settlement (ISDS), open up decisions of Government to challenge in an international arbitration panel that has shockingly bad judicial process. That is very dangerous, because these decisions are being decided above Parliament. They are being decided above New Zealand’s judiciary system. We are opening ourselves up to key issues that affect the functioning of democracy being decided in an international tribunal that can override our democratic processes.

We look at some of the international cases. Some of them have mentioned by my colleagues, but they have not talked about the most recent case, where President Obama’s Government is being sued over the Keystone XL pipeline carrying oil from tar sands off Alberta. It is being sued by TransCanada for US$15 billion. So we see the size of some of these agreements. We know that, for example, Occidental Petroleum took the Ecuadorean Government to ISDS and was awarded $2.3 billion over oil drilling in lands sensitive both for indigenous peoples and for ecological fragility. We have seen the case where Quebec is being sued by the US company Lone Pine Resources for $250 million over its moratorium on fracking. Because Quebec wanted to do further research on the implications of fracking on geology and the groundwater, it was sued under ISDS for $250 million. These are the kinds of cases that New Zealand may well face under ISDS.

We have heard previously that these cases have not yet occurred for New Zealand under agreements that we have already signed, but the agreements that we have signed are with countries that are not nearly as litigious as the corporations from the countries we are about to sign the TPPA with. For example, I do not think Brunei’s corporations are about to take New Zealand to ISDS, but the US corporations have been highly litigious in using mechanisms like ISDS to take countries like Canada to an international tribunal. Therefore, under the TPPA we would not only be losing parliamentary oversight of foreign investment decisions, and not only be delegating that to the Governor-General by Order in Council—which is a key loss of parliamentary scrutiny—but we would then be opening ourselves up to challenge by multinational corporations over decisions that were taken by this Parliament, which could potentially cost New Zealand an enormous amount of money.

I think what we have seen from the New Zealand public is a very loud “No” to this agreement. The most credible public opinion poll, in November last year, said that 60 percent of people who have an opinion on the TPPA reject the TPPA. That is 60 percent of the New Zealand public. People have been asking for a referendum on this agreement. This is a vitally important agreement for New Zealand’s sovereignty. It is a vitally important agreement for our economic future, for our right to regulate. I would say to Minister McClay that when he says that the right to regulate is protected, he should read out the whole sentence, which says: “We reserve the right to regulate, except where it is inconsistent with this agreement.” It is this kind of skating over the reality of this agreement that we have seen far too much of. I would say that this agreement should be rejected. The Green Party rejects it.

The question was put that the amendment set out on Supplementary Order Paper 239 in the name of the Hon Todd McClay to delete Part 1 be agreed to.

We now move to Part 2, and we have Gareth Hughes’ amendment as set out on Supplementary Order Paper 240. This is out of order, as being outside the scope of the bill.

The question was put that the amendments set out on Supplementary Order Paper 241 in the name of Barry Coates to clause 28 be agreed to.

We move to Part 4, and the question is that Part 4 stand part. Those of that opinion will say “Aye”, to the contrary, “No”. The Ayes have it. The—

💬 Fletcher Tabuteau: Party vote.

The CHAIRPERSON (Lindsay Tisch): All right, a party vote is called for. If you want a party vote, you must call for one. It does not automatically happen.

I move, That the report be adopted.