Crown Minerals Amendment Bill

Thank you very much, Mr Chair. I’d just like to refer in my contribution on Part 2, which is the amendments to the schedules of the Act—in relation to royalties. Now, we know that the royalties that are collected on mining in New Zealand are quite significant. You know, we’re talking multi-millions of dollars in terms of income for this Government and therefore multi-millions of dollars for redistribution into the country, into investment and social services.

Under schedule 1 in clause 20(1), it refers to: “Despite anything in clause 3, [this] new section 105A … any royalties to be calculated under a permit or a subsequent permit that is granted in exchange for an existing permit must continue to be calculated in accordance with—”. It goes on to mention the various other paragraphs 20(1)(a) and (b).

I was just wondering if we could get some clarification on those calculations to be included in the schedule, just for clarification for anyone that is reading the bill so that it is clear what those royalties are. And even, perhaps, the permit holder’s obligations under this schedule to pay those royalties back to the Crown. So just a short contribution here, thank you.

On Part 2, I wish to ask a question of the Minister, really, under schedule 1 that was amended. It really relates to clause 20(1B). It relates to royalties and it’s really around, “The chief executive, on application by a permit holder who opted in as referred to in subclause (1)(b), may refund an overpaid royalty, or reduce a royalty amount payable, for a reporting period that applied … on or after 24 May 2013 until the commencement of this subclause …”. Then I’ll come on to the new subclause.

My question is, I suppose, that I’m trying to understand the rationale or the basis for a chief executive being able to reduce a royalty amount payable. Maybe the Minister could explain for me, for my understanding, the conditions that would allow or lead to that occurring, because I’m struggling to understand—a royalty is either a royalty, and on what basis would a person or an entity be allowed to have a reduced royalty payable?

Then I come to new Part 2, inserted into schedule 1. It says, “Existing transactions not affected”, and then it goes on to further list amendments made to “sections 7 to 10, 18 and 19 of the Crown Minerals Amendment Act 2018 apply only to transactions entered into on or after commencement [date]”. I accept that—so that is any new transaction. And in clause 23(2), “In this clause, a transaction must be treated as being entered into before commencement even if, immediately before commencement, the transaction is subject to a condition precedent.” I want to make sure and be absolutely assured by the Minister that when this new Act is passed and when this new Part 2 is inserted we have the change of control mechanisms sorted to the point that there are going to be no unintended consequences.

It says in the next subclause that “change of control means a change of control (within the meaning of section 41A(1) and (8) of this Act (as in force immediately before commencement)”. I’m trying to understand where it says “as in force immediately before commencement”, when we’re actually talking about an Act after commencement that has a different provision around change of control. I want to understand the difference between the change of control mechanism immediately prior. This Act will be passed in the next few weeks. It will get Royal assent. What’s going to happen in the meantime and what’s going to happen now versus what’s going to happen after this Act is passed?

It then goes on to say a transaction means “a contract or an arrangement that has or will have the effect of a corporate body undergoing a change of control.” I come back to my previous question: if there are changes that occur in the uncertain period between now and the Royal assent being given to this Act, what does that actually mean and how is that going to be covered in a practical sense? Because in this House, we are brought here to make legislation and to make changes, but I’m just trying to understand in a practical sense and from my own knowledge what this actually means in terms of change and how this new part will assert that. Thank you.

The question was put that the amendment set out on Supplementary Order Paper 182 in the name of the Hon Dr Megan Woods to clause 20 be agreed to.

Amendment agreed to.

Part 2 as amended agreed to.

The question was put that the amendments set out on Supplementary Order Paper 182 in the name of the Hon Dr Megan Woods to the schedule be agreed to.

Amendment agreed to.

Schedule as amended agreed to.

Clause 1 agreed to.

Clause 2 agreed to.

Clause 3 agreed to.

Bill to be reported with amendment presently.