Land Transport Management (Regional Fuel Tax) Amendment Bill

I raise a point of order, Madam Chairperson. You will be aware of the ruling that the Speaker gave immediately prior to putting the House into committee. As you can see, almost every member of the Opposition is here, and I am advised that a large number of members of the Opposition have tabled amendments. We are now in a position where the vast majority of us do not know whether the amendments, or maybe many amendments, in our names will be debated, and I wonder whether, before you call, you’re able to indicate to some of us whether our amendments have been deemed to be out of scope and are unable to be debated, because knowing whether or not we’re preparing to speak on our own tabled amendments or perhaps in support of those of our colleagues is going to make a significant difference to the way in which we approach this debate.

I thank the member for that. I understand the dilemma. What I suggest we do, while we organise this, is that someone take the call, and then I will make sure that we are able to inform those whose amendments are out of order.

I’m happy to take a call in relation to a tabled amendment I lodged yesterday on Part 2. As I said to the honourable Minister Phil Twyford last evening, it’s all very well in theory to think this is going to work, but, actually, there are some realities that I want to point out to the Minister and this committee.

Under the regional fuel tax legislation the key responsibility at a local level is the regional council, but, under the provision of who’s funding the work, it won’t be the regional council; it’ll be the territorial authorities in places other than unitary areas. So in places like mine, if we were ever to have a regional fuel tax in Hawke’s Bay, the costs of the projects will actually be jointly funded between the local authority, the New Zealand Transport Agency (NZTA), or even the regional fuel tax itself.

Now, I want to point out to this committee that, actually, regional councils have a very different role than delivering transport solutions other than in public transport. Regional councils largely look after air and water and the management of those, and in many cases they also have a significant provision about passenger transport, and they also host and generally organise the regional transport committees and the regional priorities. But they do not fund the work. They have a facilitation role, and they manage the public transport committees. So while there is a trade off in terms of what the regional council might do in this space, the biggest trade-offs, actually, are, in money terms, from the territorial authorities—how they spend their money on this project versus that project. And if they know that a regional fuel tax is going to partially fund, there is a big temptation amongst local authorities to shift money into that where they can actually get regional fuel tax money as well.

What I’m seeking to do is put a new clause, under a tabled amendment in my name, which would say that after clause 10(5) there is a clause 10(6), and that would require that the regional council of a regional fuel tax region in its long-term plan must report on the following things: the revenue from a regional fuel tax, how this revenue was applied, and progress with respect to that programme supported by the regional fuel tax.

And, just to make it very clear to this committee, the long-term plan is the biggest consultative document that a local authority will do in a three-year period. In fact, outside of that three-year period it can, if it wishes, not do any other form of consultation. So once every three years—once every three years—it must, by the Local Government Act 2002 section 82, consult with its community. And what we’re saying in this tabled amendment, and what I’m asking the Minister to think about, is actually making it very transparent in that document that while the regional council is the facilitator of the process, the territorial authorities are the funders, and they’re going to use their resources—even in a coordinated way, and often with NZTA—to look at projects together. I say that because, simply, without doing that, most members of the public, apart from the first period in the 10-year period, will not have any visibility about what the regional fuel tax is doing and what projects it’s going to fund.

So I say to the Minister, I think this is a simple solution to try and force the regional council, using the public consultative process in the long-term plans, to make a difference that will matter. Regional councils—in my experience in the last six years, anyway—have got way better at consulting with the community. So they consult with the community about land and water measures and about public transport, and I think it would be a great measure for this amendment to be added into the mix so that they can formally consult and report on as part of the long-term plan.

Thank you, Madam Chair. This is the first call that I’m taking in this debate. Coming to Part 2 of the Land Transport Management (Regional Fuel Tax) Amendment Bill, I want to focus very much on clause 7(3), where it says in here, in new section 5(6BB) that there will be a new part of the Act where “(a) any amount of regional fuel tax … that is paid is treated as being consideration for a supply of services in the course or furtherance of a taxable activity carried on by the New Zealand Transport Agency, as agent for and on behalf of the local authority responsible for the [regional fuel tax]”.

What that means, in plain English, is that the regional fuel tax that New Zealanders are going to be required to pay is itself now going to be treated as a service—goods and service—under the GST Act. This means that GST, at 15 percent, is now going to be added to the amount of regional fuel tax.

That is a tax on a tax, and that is actually something that I know members in this House, particularly the New Zealand First Party, have railed against time and time again—

💬 Hon Scott Simpson: Relentlessly.

—relentlessly, for years, against a tax on a tax.

💬 Hon Chris Hipkins: As did your colleagues last night, repeatedly.

We have seen referenda from all over the country, repeatedly, as Mr Chris Hipkins has said—although I think he may wish to be a little quiet today, given his mea culpa, and I think—

💬 Hon Scott Simpson: He’s been humiliated.

He’s actually been humiliated, and having been humiliated by himself makes it even worse. So New Zealand First has railed for years—and who here on this side of the Chamber has heard them do it; haven’t we all heard them; they have—against a tax on a tax. When I look at this, I think, “My goodness, things have changed.” Where is the New Zealand First Party on this issue? Where is the Rt Hon Winston Peters, now Acting Prime Minister, who could stop this—who could stop this—because he is actually now running Cabinet and the Government. He could stop this tax on a tax. Where is he on this issue?

💬 Hon Scott Simpson: Silent.

He is silent. He’s a lion in Opposition and he is a lamb in Government, as is the New Zealand First Party. Why are they all looking down? Is it because they cannot face the truth?

💬 Fletcher Tabuteau: You’re boring me.

Is it because they cannot face the truth? And Fletcher Tabuteau, who is an unknown to most of New Zealand—let me help him with his profile. He, an unknown—a virtual unknown and novice, and, apparently, the right-hand person to the Rt Hon Winston Peters—

💬 Chris Bishop: That’s right—the next leader.

The next leader—the next leader. He says it’s all too boring. He said that today. Now, a tax on a tax, Mr Tabuteau—I’ve got a feeling this is going to come back to haunt you. So this is a tax on a tax, where we have a Government that doesn’t want to debate the issues and has had to put the House into urgency on a bill that they knew they had for a long time, rushing this through without representation.

A hallmark of any liberal democracy is that we have representation on taxation and we have taxation by consent of the people. Who is consenting to regional fuel tax? I can tell the committee: New Zealand First is consenting to regional fuel tax, the New Zealand Labour Party is consenting to regional fuel tax, and the Green Party are consenting to regional fuel tax. The people are not consenting to regional fuel tax, and that’s why the National Party is here today, because we will not agree with something like this, where 70 percent of the people have said that they do not agree. They want us to defend their right not to pay this tax on a tax.

OK, if I just take a moment and I will notify the committee of the amendments I am ruling out of order. Before I do that, I just remind speakers that they’re starting to get quite repetitive, and that means that that could bring the debate to a close.

So I am ruling out of order Lawrence Yule’s amendment inserting new clause 10 as outside the scope of the bill. Denise Lee’s amendment inserting new clause 12, amending the Charities Act, is outside the scope of the bill. Denise Lee’s amendment inserting new clause 12, amending the Education Act 1989, is out of order because the subject of the rebate to which it relates has been dealt with already under Part 1. Chris Penk’s amendment inserting new clause 12, amending the Local Government Act 2002 is outside the scope of this bill. Hamish Walker’s amendment inserting new clause 12, amending road-user charges, is outside the scope of the bill. Jami-Lee Ross’s amendment inserting new clause 12 is out of order as benefit and other similar payments are outside the scope of the bill. Kanwaljit Singh Bakshi’s amendment amending the Veterans’ Support Act is also outside the scope of the bill. Dr Parmjeet Parmar’s amendment inserting new clause 12, amending the Road User Charges Act, is outside the scope of the bill.

Thank you, Madam Chair. It’s a pleasure to rise and speak to a tabled amendment that has not been ruled out yet, in relation, specifically, to the Land Transport Management (Regional Fuel Tax) Amendment Bill. My amendment relates to Part 2, of course, in this part of the debate, and it, specifically, would seek to insert a new paragraph in new section 34B(1) in clause 10(5). The wording of the text I’ll speak to and then, obviously, I’ll outline the reasons that I am proposing such an amendment to the committee: “(d) Reporting of all RFT Schemes should be received by each local board in a region and consultation undertaken with that local board prior to the consultation on the annual report.”

The reasons that I have proposed this amendment, first, relate to the fact that reporting will be required by the insertion of this amendment. Reporting is inherent to the nature of a regional fuel tax (RFT) scheme because it is an accountability mechanism to the extent that the bill even requires accountability in the first place. The people of a region who will be subject to a regional fuel tax must have the ability to know that the projects that have been used to justify the imposition of such a tax are being undertaken. The reporting element is a fundamental feature, therefore, and that is the reason that I am suggesting it by way of this amendment, specifically in relation to local boards. That is the matter now that I wish to turn to.

Local boards, it seems to me, are the most appropriate level of local government for such reporting to be made. The reason is that a regional fuel tax is, by very definition, applicable to an entire region, and a region can be a large geographical area, whereas a local board area is, of course, as one would expect, a much smaller area and therefore more responsive to the needs of the local people. Again, to increase the transparency and the accountability of the projects aligning with the taxation that has justified it, it is appropriate that local board members should be accountable to their people who have voted them in, in that very direct fashion.

The next point that I wish to make in relation to my amendment is the fact that it would be in an annual report that such consultation and reporting would be made. An annual report is, of course, sufficiently regular—once a year, as the name implies—that progress of projects would be monitored carefully and on a continuous and, indeed, continual basis up until the point at which those projects are completed. If, in accordance with the mechanism set out in the regional fuel tax, a project is used to justify the introduction of a fuel tax, it makes sense that the progress of that project be reported back regularly—not less than once a year, I would suggest—by way of annual report.

My final point in relation to this amendment, in the time that remains to me, is the fact that such reporting would be mandatory. This is the reason that I have chosen the words “should be”, as in “Reporting of all RFT Schemes should be received by [a] local board”. Arguably, I could have been stronger in my language, perhaps, and used something like “must”, “shall”, “in every case be required to”, and so on. However, I think it is clear enough to say that the reporting “should be” received, and the point of that, of course, at the risk of stating the obvious, is that it is to be required that such reporting take place. If we leave it at the option of the local board or, indeed, any other level of local government to make such reporting or not, then the people of the region who are subject to a regional fuel tax can have no assurance and no guarantee that such reporting would be made.

As a related note, as I understand it, such a mechanism would, in turn, require that the Office of the Auditor-General be able to have oversight of such reporting, and the accountability mechanism, therefore, would be—[Time expired]

Thank you very much, Madam Chair. It’s a pleasure to take another call—well, actually, my first call in Part 2 of the Land Transport Management (Regional Fuel Tax) Amendment Bill. I thought I would also speak in favour of the amendment in the name of Chris Penk, which he’s just been speaking to. I thought I could bring to the committee some experience, having sat on a local board, and support the good work that he is doing by bringing this amendment to the committee.

I just want to commend Chris Penk as the new member of Parliament for Helensville for doing such a good deed, because the people—and he represents a number of local boards in Auckland and all of those local boards wish to be seen as co-governors in the Auckland Council. I think what would be fair to say from my experience being on a local board in Auckland is that too often local boards are seen as second-class governors, and they need to be more empowered. This proposed new section 34B(1)(d) inserted by clause 10(5) would give more power and would give more influence to local boards across Auckland.

There are a number of reasons why I’d like to speak in support of this. I think, firstly, the reporting is an important part—going to local boards—because local boards represent the people, they represent constituents, and they need to know that the tax being paid by the people that they’re representing is having an impact in the local area. And I think what we see with the regional fuel tax which is being proposed by Auckland Council is, yes, they’ve tried to spread the benefits out across Auckland, but local boards need to know that each year progress is being made and what that progress will be, so that they can be part of that conversation, not just be recipients of information after the fact or just see what’s being talked about at the governing body table.

Local boards are players. They have decision-making power. They have budgets which they can also put towards transport projects—and I understand in the long-term plan that budget has been doubled for local boards in Auckland. So they are actually significant players when it comes to local transport in their areas. So they need to be part of this process each and every year along the way.

I think the other very significant word which has been included in this new section which has been proposed by my colleague Chris Penk is the work “prior”. It says, “Reporting of all RFT Schemes should be received by each local board in a region and consultation undertaken with that local board prior to the consultation on the annual report.” Now, I think that word “prior” is a critically important word in the context of Auckland Council, because, from my experience, local boards get told things after the fact. They get told them later, and what they need to be is engaged in the process earlier.

I am speaking very strongly in favour of this because local boards need to be seen as co-governors in Auckland Council. The Local Government Act sees them as playing a very important part in representing their local community and developing their local community, and this is another way in which we can improve this legislation if it was to pass—and, you know, on this side of the Chamber, we don’t support this legislation, but I think this is a very sound amendment.

I’d like the Minister, actually, to take it very seriously, as someone who is a member representing a seat in Auckland and who has local board members which he would meet with regularly and who would understand some of the issues and challenges that they face. I think they would have a very strong view on this, and I would like to hear the Minister outline his views on this clause and—I hope he would support it, and it would be great if he did, but, if not—why he doesn’t support it. I think local boards and local board members, of which I think there are 170 of them in Auckland, would deserve the right to have the Minister explain to them exactly why they should be left till after the report comes out—why they should find out after the annual report comes out and not be engaged in the process of actually making that annual report and what impact it will have on their local communities.

So I think this is a really important amendment. I commend again the member for putting it forward. I think there’s a range of amendments being put forward which make small but significant and sensible changes to this legislation to help improve it and which are actually, I think, well thought through. So, once again, thank you very much to the member Chris Penk for putting this forward, and I very much look forward to the Minister answering my questions and explaining his thoughts on this issue. Thank you.

I want to talk about an amendment to clause 10 which is an amendment from my good colleague from Kaikōura, Mr Stuart Smith, who represents that excellent electorate down there, which I understand is just slightly larger than the State of Israel. So, of course, very relevant because Kaikōura’s got a lot of roading projects down there, and, of course, this is what we’re talking about: fuel tax.

What the proposal actually is about is that after clause 10(5), we want to amend new section 34B of the Local Government Act, which is about the issue of cost-benefit analysis. It states in new section 34B(1)(d), “the cost benefit analysis that the Council has undertaken in relation to where the revenue [is] spent.”

The reason why I want to focus on that is that we all know that if we’re spending great dollops of money on roading and infrastructure projects, so-called being driven from this fuel tax that’s being raised—by the Auckland Council initially, but, of course, we know it’s going to ripple around New Zealand—where is that money going to be spent and how is it going to be spent? The big question—even if we go to Auckland, where this fuel tax is going to be put in place on 1 July, in only a matter of a few days, we know that their options are: do we spend it on public transport, do we spend it on roads, do we spend it on rail, do we spend it on cycleways, do we spend it on safety improvements, or do we spend it on ferries? And I note, in the recent press announcement just yesterday, that there is virtually nothing allocated to ferries in Auckland—a shame in my personal view.

And I think the allocated efficiency of how you spend money is really, really important, and that is really what benefit-cost analysis is about. And we know that it is about allocated efficiency, and we know about the Pareto factor—don’t we?—which is a very important part of a cost-benefit analysis. And I just don’t think there is enough thought about those sorts of issues.

So one of the things is I think, you know, there’s always a choice about where you spend your money and where we spend all this money that’s so-called going to be raised by this fuel tax in Auckland. So one of the things is: how do you align that money that’s been ripped from the heart of people’s wallets into appropriate projects?

And I think one of the important things—I think if you don’t have a disciplined approach around benefit-cost analysis of that money, what you do is you end up with very sloppy expenditure. I can quote you, for example, in my electorate alone the Redoubt Road - Mill Road proposal. The Government love to say that they’re doing the Mill Road extension, which is an entire motorway from Manukau down round Papakura and re-joining between Drury and Ramarama; unfortunately, that is not the case. All they’re doing is the first bit, Redoubt Road, which, of course, was what Auckland Council wanted to do all along.

And so what they’re doing is they’re spending not the $1 billion that the National Party agreed to do before the election but only $500 million. And they’re going to do Redoubt Road, and then they’re going to upgrade a couple of intersections. And what I don’t think the cost-benefit analysis does enough is actually look at all the benefits.

So normally you do a cost-benefit analysis on the entire project, but, if you’re only doing part of the project, that means that you do not actually get all of the benefits. And I think, in many cases, some of the expenditure being proposed in the ATAP—Auckland Transport Alignment Project—does not have a proper analysis around all the benefits as if the projects were completed in full.

And that, of course, brings me to the Living Standards Framework that Treasury has been proposing—and, in fact, we’ve been debating it over the last couple of days. What are the benefits? Should it only be a financial benefit? Should it only be an economic benefit? Or should we be applying the Living Standards Framework that the Secretary to the Treasury has been proposing—you know, social capital, human capital, and environmental capital? I think all of those, but I think the most crucial point is that when this money is being used, it should be put through a proper cost-benefit analysis and should be subject to a disciplined approach.

Thank you, Madam Chair. It’s deeply moving to hear a member of this committee, like Andrew Bayly, obviously moved to a great degree by the cost-benefit analysis. I’m very pleased to see this new adherence and commitment to sturdy cost-benefit analysis from a party who, during the last Government, committed about $13 billion worth of motorway expenditure without a cost-benefit analysis being done at all.

I want to reassure Andrew Bayly that the transport projects that will be funded by this regional fuel tax will all—any significant expenditure will be dealt with with a cost-benefit analysis, because that’s the way the New Zealand Transport Agency does its work. So there’s no need to require mandatory cost-benefit reporting as part of this regional fuel tax bill, because virtually every significant item is subject to the cost-benefit analysis.

I also want to respond to the member Chris Penk, who has proposed by way of an amendment that there be mandatory reporting to local boards, but this is a kind of—if I can suggest—random, nit-picking imposition of added consultation. Just for argument’s sake, imagine the fourth term of the Ardern-Peters Government, a long time in the future. Some other regional council around New Zealand may be considered for a regional fuel tax, and that regional council may not have local boards, because most regional councils do not have local boards in their areas. Some have community boards. There’s nothing about community boards in this amendment. Many regional councils don’t have local boards or community boards. They have neither. If the member knew much about the extensive consultation requirements that are already placed on councils and their community boards and local boards, he would know that this kind of random imposition of more bureaucracy is simply not needed.

May I say, I have no idea why the Minister in the chair, Phil Twyford, took that call, because I hoped that he was about to answer some very legitimate questions that colleagues on this side of the House have been asking about Part 2 and, instead, all we got was an arrogant and, frankly, insulting put down of my colleague Andrew Bayly, followed by an unbelievably condescending remark to one of the newer but very intelligent members on this side of the House Chris Penk. He has not answered anything.

Madam Chair Tolley, could I nevertheless thank you for the considered ruling that you gave us, which is appreciated on this side of the Chamber because, without it, we would have been struggling to marshal our forces for the next hour or so. So I do appreciate that.

But let’s be under no mistake. As we consider Part 2, we are in uncharted territory here, and, therefore, I think it is incumbent on the Government, and particularly the Minister in the chair, to give considered and dignified responses to the very legitimate amendments that are being put forward. Because it’s palpably obvious to anybody listening that we on this side of the House do not like this bill and firmly reject Part 2, but we are, through our amendments, attempting to help to improve it, and it is up to him, surely, to take those points on board and to respond to them.

Now, when I was last speaking on this part, I was beginning to quote from Mr Ken Shirley who is, of course, the Chief Executive of the Road Transport Forum. And I was making the point that under Part 2 of this bill, his concerns about the implications on local government need to be taken very seriously indeed. He’d made the point that it came as no surprise to learn that 14 councils around the country are seeking a regional fuel tax.

And when I was interrupted I was going to go on and quote from him the following: “With a number of councils obviously seeking this option it is likely to result in unintended consequences such as forcing transport operators and fuel retailers out of certain regions to avoid the tax. That is, of course, if price spreading doesn’t just make a mockery out of the whole concept anyway.” And so I am asking the Minister in the chair to respond to the concerns of Mr Shirley, who is, after all, a former Labour MP, presumably reasonably sympathetic toward some of the goals of the current Government, and to say whether he believes Mr Shirley is wrong and, if he believes he’s wrong: why is he wrong and what is it about this bill that can satisfy him? Mr Shirley is an expert in this area, and we are entitled to an answer.

I’m also deeply unimpressed that the Minister in the chair has still not given an answer—at least while I’ve been in the Chamber, and I’ve been here for much of this debate—to the legitimate query that I have raised as to whether there is a drafting error. It’s on page 27 of the bill under Part 2, clause 7, in new section 5(6BB)(a) to the Goods and Services Tax Act. I’ve read it out a couple of times before, and it refers to the “furtherance of a taxable activity carried on by the New Zealand Transport Agency,”. And my query is whether that wording is wrong.

The Minister has not yet answered that. To refuse to do that I would suggest is both arrogant and treating this House, while we’re in committee, with contempt, and I’m asking him to stand up and take a call and tell us.

I now want to turn to the amendments to the Local Government Act 2002, which are outlined in clause 10 of Part 2, and that’s on page 28 of the bill. I’ve already referred to the first part of clause 10, where it is proposed to insert a new section 34B, but under paragraph (b) of subsection (1) there—I haven’t got on to this one yet—“how that revenue was applied by the council, including to which projects and for what purposes (for example, capital expenditures, debt repayment, operational expenditures);”.

And my question to the Minister is: why is this clause so wide, and how can its provisions possibly be justified? I haven’t heard a single explanation yet of why this very wide clause has been included. I’m asking the Minister to stand up to answer all of the questions that have been put to him by members on this side of the House; to respond in an intelligent and honest fashion to the way in which the amendments that we’ve put forward have been argued; if he disputes them, to explain that clearly; to answer the questions that I have put forward in this particular part; and to understand that Part 2 of this bill—while it was originally thought that Part 1 was the meaty bit—actually contains a considerable amount of material that needs the considered attention of this committee. I can see that I’m running out of time.

Thank you, Madam Chair. It’s a pleasure to rise and take another call on Part 2 of the Land Transport Management (Regional Fuel Tax) Amendment Bill, and to address the second of my proposed amendments, which, fortunately, was not ruled out and has not yet been debated in this part. What I am proposing here is to amend clause 7(3) and insert a new subclause 6BB(c) to “Amendments to Goods and Services Tax Act 1985”.

Now, as we’ve already heard from the Hon Judith Collins, what we’re proposing here, actually, has been to put GST on top of a fuel tax—therefore a tax on a tax—and we have heard vigorous opposition to that from numerous Government members in the past. It’s actually been interesting to note, since joining this House, how quickly the Government parties have been prepared to go back and change their stance on a number of areas they previously advocated for so passionately, so strongly, and how they now change their minds in that regard.

With regards to this amendment, what we’re actually seeing here is a proposal to amend the Goods and Services Tax Act, and we’ve already heard that the regional fuel tax is now considered to be a supply of services and, therefore, taxable, and therefore a tax on a tax. Now, I’m surprised at the arrogance of this Government—that they have not made any efforts whatsoever to address this or any number of other top quality amendments that we’ve seen presented from the Opposition benches throughout the debate on this part. I’ve been here for the duration of the debate on Part 2, across, now, several days, and it amazes me that we are yet to see a single member from the Government benches rise and take a call on this part. It is simply outrageous and a clear sign of arrogance that they have no interest whatsoever in debating the content of this part and in trying to get a better solution for all Aucklanders, in this case, and subsequently for all New Zealanders once this is expanded to many other areas.

💬 Hon Tim Macindoe: But they want to pass it under urgency.

Indeed, as Mr Macindoe points out, they are looking to pass this under urgency. Suddenly, they’ve been caught out and have realised that they are perhaps not able to meet their time line of 1 July, given that they have obviously poorly managed this process to date and are now trying to proceed through it quickly without any discussion on this. Also, we’ve heard from the Minister in the chair, the Hon Phil Twyford—he’s taken a call and that’s good—but, actually, we’d like to see him addressing in more detail the many points that have been raised now, not just today but in previous discussions last night too across the range of amendments that were proposed.

So this amendment in particular—“Amend clause 7(3) insert new 6BB(c) to the Goods and Services Tax Act 1985”—reads, “All Goods and Services Tax (GST) levied by the RFT [the regional fuel tax] must be allocated for expenditure in the Region within which it was raised.” So look, this is something that I feel the Government could well support. They’ve made numerous comments along these lines with other areas of GST that has been claimed or earned as revenue. For me, this is one area that I feel would be well supported, of course, by the applicant for any particular regional fuel tax, because they’re advocating for their specific projects and, therefore, would be desiring to have as much cash as possible to fund those particular projects.

We’ve seen now a massive array of councils around the country looking to put forward proposals in this instance. I’d also just like to quickly refer to my previous amendment, which would require anyone making such a submission to provide more detailed advance notice around their intentions on the particular projects they’re looking to support to give clarity to their ratepayer. What we’re seeing here, even in my electorate, in the Waikato, we’ve heard both the Waikato District Council and the Waikato Regional Council are now looking to advocate for their own opportunity to have a regional fuel tax to fund projects, quite probably projects that were outlined by the previous Government under the roads of national significance, which I would strongly encourage this Government to continue to support.

I call Chris Penk. I’m sorry; I call Simeon Brown.

Thank you very much, Madam Chair. I know I look quite similar, and I’m very fresh and new, just like Chris Penk.

💬 Hon Judith Collins: And very talented and hard-working.

And equally hard-working, like the good member Christopher Penk, who’s working hard in Helensville, whereas I’m the good member for Pakuranga and I’m pleased to be able to stand here and represent the interests of the motorists in my electorate who will be punished by this tax—realising there should be no taxation without representation, and that’s a message I will continue to advocate for during my time in the House. I have just tabled a new amendment which seeks to address a point raised by the Hon Phil Twyford when he disagreed with the amendment in the name of Chris Penk which says that there would be reporting of all regional fuel tax schemes, to be received by each local board in the region, in consultation undertaken with that local board prior to the consultation on the annual report.

Now, the Minister took a call, and I was very pleased that he took a call, because I think this is a very worthy amendment and makes a lot of sense. It empowers local boards and has all of the reasons that I gave beforehand. But he made a very good point. He said that there are community boards as well, and other territorial local authorities, and, of course, local boards are really only in Auckland, which, of course, is a unitary authority under the Local Government Act, and local boards were given to ensure that local communities had a strong voice in Auckland and in its decision-making power. So of course community boards should also be added, but the point in this, which I think got missed by Mr Twyford, was that, of course, this tax is only meant to be for Auckland. So when Mr Penk put together this amendment, a very good amendment, he was thinking, “This is a Government which will keep its promises. This is a Government which is only going to be putting a regional fuel tax in for Auckland, because that’s what they campaigned for—so therefore you’d only need reporting for Auckland and therefore the legislation should only need to cover local boards.”

But, of course, we know that this doesn’t just allow regional fuel taxes for Auckland; this allows regional fuel taxes across New Zealand after 2021. And what do we call that? A broken promise. But it also means that this legislation needs to reflect what the Government’s true intent is. So I would like to take a moment to again explain why this is important—and it is important, and not just for local boards. If these regional fuel taxes are going to be put across all of New Zealand—and we know there’s about a dozen councils which have put their hands up and said, “Please tax us.” or “Please tax our motorists and our residents and ratepayers, who already pay a huge amount of money.”—“Please tax us.” Well, there are community boards there, which also deserve to be part of the local government decision-making process. They deserve to have their voice heard. They deserve to have that consultation prior to the annual report, and, again, that word “prior” was included in my amendment, because it’s important that our local boards and our community boards are not continued to be trampled over by this Government and by the senior leadership in that council and then just left there to deal with the pieces at the end of the day.

So the amendment says that it should be done prior. They should be part of the process before the annual report is produced, so they know that the money which has been taken off the people who vote for them, the people that they represent, is going into projects in their area and so they know what the progress of those proposals is, how it’s going, whether the construction is on time, whether it’s being delivered as it was said it was going to be delivered by the plan, whether there’s been a delay, why the delay is happening, and what the reason for it might be, so they can feed into that annual report.

Because we all know that projects take time, and often we see projects being delayed for a variety of reasons. Most of them, I would say, there are reasons why they happen, but local boards and community boards need to be part of that conversation. So I hope now that I’ve clarified the Minister’s concerns over that amendment in the name of Christopher Penk, and I hope that he will support my amendment in the name of Simeon Brown and that he will vote for it and support it so that all communities can have their say and be included. Thank you very much, Madam Chair.

Thank you, Madam Chair. I want to respond to a query that’s been raised a couple of times by the member Tim Macindoe about the use of the words “carried on” in the bill. There’s some cause, I think, for the member to have concern about the words “carried on” and I quote the Cambridge online dictionary, which refers to a number of meanings for “carried on”. It can mean “to behave in an uncontrolled, excited, or anxious way”. It can refer to “an old-fashioned informal reference to have a sexual relationship”. It can also mean “behaviour that shows you are annoyed, worried, not satisfied, or excited”—usually more than the situation deserves.

But I have sought advice from the Parliamentary Counsel Office about the drafting that led to the use of these words in the bill, and I’m informed they’ve checked and the phrase “taxable activity carried on” is used 29 times in existing legislation. The phrase “taxable activity carried out”, which I think was the alternative that the member referenced, is not used at all. There’s no record of it being used in existing legislation. So these words are, in fact, standard IRD drafting, and I hope that answers the member’s query.

I move, That the question be now put.

Bear with us for one minute. We just want to make sure we get all the amendments correct so that every amendment has the opportunity to be put and voted on.

The question was put that the following amendment in the name of Tim van de Molen to clause 7(3) be agreed to:

in new section 5(6BB), insert after paragraph (b) the following paragraph:

(c) All Goods and Services Tax (GST) levied by the RFT must be allocated for expenditure in the Region within which it was raised.

The Hon Scott Simpson’s amendment inserting new clause 12, amending the Local Electoral Act 2001, is out of order as the requirements for local authority referendums are outside the scope of the bill. Jami-Lee Ross’ amendment inserting new clause 12, amending the Social Security Act 1964, is out of order as benefit and other similar payments are outside the scope of this bill.

The question was put that the following amendment in the name of Brett Hudson to Part 2 be agreed to:

insert, after clause 11, the following subclause:

12 Amendment to the Public Audit Act 2001

(1) This section amends the Public Audit Act 2001.

(2) After section 16 insert new section 16A:

16A Regional Fuel Tax Scheme Audit

(1) The Auditor-General must, at least one year after the establishment of any regional fuel tax scheme under Subpart 3 of the Land Transport Management Act 2003, examine—

(a) the extent to which any public entity is complying with Subpart 3 and to what extent the relevant public entities are activing effectively and efficiently under the provision of that subpart

(b) a public entity’s compliance with its statutory obligations under subpart 3 of the Land Transport Management Act 2003:

(c) any act or omission of a public entity, in order to determine whether waste has resulted or may have resulted or may result in relation to functions under subpart 3 of the Land Transport Management Act 2003:

(d) any act or omission showing or appearing to show a lack of probity or financial prudence by a public entity or 1 or more of its members, office holders, and employees under subpart 3 of the Land Transport Management Act 2003.

(2) An audit under this section may relate to 1 or more public entities.