Forests (Regulation of Log Traders and Forestry Advisers) Amendment Bill

Tēnā tātou e Te Whare. I move, That the Forests (Regulation of Log Traders and Forestry Advisers) Amendment Bill be now read a second time.

First, I would like to acknowledge the efforts of the select committee, led by Dr Duncan Webb, and to share with the House that this is evidence that the select committee process works. This select committee process enabled a host of submitters, some using cyclostyle submissions; however, these submitters were able to bring their concerns forward to the select committee as we sought to refine this piece of legislation—very significant in the post-COVID environment, because it addresses a longstanding problem in the forestry sector, which is the absence of certainty, predictability, or, quite frankly, the ability for the investors in the domestic processing manufacturing segment of the broader forestry community to plan and invest. This bill has been improved through the select committee.

There were some concerns that the bill may have interfered with the ability of the owners of commodities to actually sell within an envelope struck by the seller and the purchaser. That in itself was an apocryphal falsehood; however, the chair of the select committee and the members addressed that issue by making it very clear to the elements from the forest sector and the broader community who have an interest in the passage of this bill that it was never the intention.

A few other things I would like to say that have happened as a consequence of the Environment Committee reviewing this bill is that the “Purpose” section has been strengthened. The select committee deemed it appropriate to add the term “equity” into the purpose statement. Now, the term “equity” is of incredible importance in any industry but in particular the forestry sector to ensure there is an equitable distribution between the raw material that is required to boost and maintain jobs and fuel industry in our own country and the ability of log mongers, on behalf of largely foreign-owned entities, to continue to sell to international markets. International trade is incredibly important, but of equal importance in the post-COVID environment is us looking after ourselves.

The call for this type of regulation has been longstanding from those members of the forest-owning community who are concerned about the quality of advice they have been receiving from forest advisors. Log mongers have, in many cases, not represented with much integrity, quite frankly, the best interests of the forest sector. They have treated many of their fellow New Zealanders in a very disrespectful and a very dangerous way, given that the New Zealanders employed in processing and manufacturing face considerable harm, stress, and pressure, given the rising tide of protectionism in other parts of the world.

So it’s important that when we pass—which is largely a regime to create an occupational licensing system. Some of the ideas were borrowed from the days when the regime of real estate agents was brought into a more tidier form. Sadly, some elements of the forest sector have made wild accusations and use quite incandescent rhetoric, which is most unbecoming of people who are meant to be representing the better interests and the finer sentiments of international investors.

After the election, it’s likely that politicians will want to restrict the ability of forest investors to expand their holdings into productive farmland. Those matters, however, belong on the electoral trail.

There’s a provision for complaints to be made. There is a provision for people to be registered, and once they are registered, the quality of their conduct can be tested and they can live up to a higher level of commercial conduct than has historically been the case.

But there is no provision in this bill—as I wind up—that impinges forestry owners’ property rights. Similarly, there is no provision that enables the State to fix prices. What it is doing is bringing transparency and upholding the importance of integrity in this sector of the economy, where there have been too many egregious cases of cowboys in the Wild West—although it’s often on the East Coast, as is evident in the media this morning by the debris in Tolaga Bay.

As I repeat again, this bill does not violate a single international obligation in terms of the World Trade Organization or trade. Those are falsehoods. Those are accusations which, quite frankly, will not stand up once the glare of publicity continues to be directed in cleaning up this part of the industry with an overdue regime for licensing log mongers and ensuring that the providers of advice, such as the Roger Dickies of the world, are held to a high standard of integrity. I support this bill.

As I listened to that speech by the Hon Shane Jones, my thoughts considered a future political science student studying that valedictory speech from the Hon Shane Jones and suddenly wondering what decade it was actually said, because that is the sort of speech I would have expected in the 1970s and the 1980s when this Parliament sat and put price controls across all sorts of products. I thought we’d moved past that and I can tell the House today that National will continue to oppose this ridiculous legislation. We will stand up for common sense in the forestry industry, something that the Labour Party should be doing today. But instead they’ll sit there and they will swallow yet another dead rat from New Zealand First insisting this legislation be passed before the election. I say that this legislation will be just another nail in the coffin of the New Zealand First Party.

I speak today on behalf of our member for Clutha-Southland, Hamish Walker, who is down doing his constituency work in his home patch. But he asked me to take this call on behalf of National and certainly say that we will oppose this legislation not only in the second reading but through the committee stage and for the third reading, because we are highly suspicious as to why this legislation is before the House. In the dying days of this Government, I suspect Labour should stand up and actually also be opposing this legislation. I cannot believe that the Labour Party truly believes we should be putting in place legislation that, when you sift through the words involved in this legislation, comes down to one thing: the ability of the Minister of Forestry to control the log price to ensure that domestic processes—

💬 Dr Duncan Webb: Not accurate.

—get logs supplied to them. That’s what it’s about, and Duncan Webb chaired the select committee. He knows that’s what it’s about—

💬 Hon Nathan Guy: Shame on him.

—and, yet, I suspect shortly he’ll take a call, and shame on him. He will support this legislation.

I want to start by considering the process of this legislation, because that in itself has been a shambolic process. It was put into an urgency motion on the Budget of 14 May. It was rushed off to a select committee, the Environment Committee, whereas for the time that I’ve always been here, forestry legislation has gone on to the appropriate select committee, the Primary Production Committee. But there was an issue there because maybe the Government didn’t have the numbers to control the legislation, so they shifted it off to the Environment Committee, where clearly they have the numbers to control it.

Then the next thing they did is they shambolically restricted the process by which submissions could be heard.

💬 Hon Nathan Guy: How long were submissions open?

They opened for submissions on 15 May, and—would you believe it?—they closed that submission date six days later. The standard process in this House, Dr Duncan Webb, is six weeks. It could have been done, because here we’re talking about the second reading today, many months after this, but they gave it six days.

So did they get a few submissions? I respect the forestry industry—650 submissions flowed into that select committee, of which 640 were absolutely impeccably opposed to this legislation.

💬 Clayton Mitchell: Because of the big multinationals.

Clayton Mitchell says it was big multinationals. Well, the submissions I saw were actually mum and dad investors—mum and dad investors—in woodlots, farmers with their woodlots. They’re not big multinational investors. In fact, for Clayton Mitchell to interject suggesting that, I tell him to go back and watch the news last night about big multinational investors. Have a look at Newshub at 6 o’clock last night, Clayton Mitchell. I’ll talk about that shortly at this time.

I have been involved in the periphery as a farmer in the forestry industry. I’ve owned woodlots; I’ve milled woodlots, and for Shane Jones to suggest the industry is full of cowboys is an absolute insult to this industry. It is highly professionalised. There are good people in this industry. But then they put this legislation before the House and shortly, you watch, Labour will vote for it—Labour will vote for it. They’ll swallow that dead rat, yet again.

💬 Hon Nathan Guy: We’ll remind them on the trail.

Oh, they’ll know about it on the trail. They’ll know about it. They’ll vote for this legislation, and what does it do? It puts in a registration regime for log owners, for log traders, and for forestry advisers. And then it has the ability, subsequently, for Ministers to impose regulation. That’s the bite, Dr Duncan Webb.

💬 Dr Duncan Webb: I’ll talk about that.

What that is—I know the member will talk about it, but it won’t help in talking about it, because it’s wrong. What it is is price control. What it is is making sure that the price of logs is controlled in such a way that potentially vulnerable or marginally economic processors get an opportunity to buy logs at a price that makes them competitive.

I say to the member over there—Dr Duncan Webb—who continues to interject, Argentina tried this. They tried it with the beef industry and it brought their economy to its knees. They were worried about the price of beef to domestic consumers so they restricted the price and brought it down and made sure that a huge quantity of that beef stayed in Argentina. It was an absolute disaster of a policy and that’s exactly what this Government is doing—it’s exactly what this Government is attempting to do. I say that we’ve moved such a long way with the economy, as we’ve opened it up over the last 20 and 30 years, whereby we have a market that’s open to pricing, and that’s the way it should be. If the international buyers of logs are offering a price, then if the domestic processors want to meet that price, then they can. But to try and control the price and bring it down to make a few sawmillers, who are possibly marginally economic anyway, have the ability to process those logs is absolutely wrong.

What this is about, as I mentioned, is the compulsory registration of advisers. What will that achieve? That is more red tape and more regulation. It’s about the compulsory registration of log trading entities. Well, that includes me when I mill my next forestry farmlet. Why should I have to register as a log trading entity?

Then there is the issue which the Minister raised around trade implications. We suspect there are breaches with the World Trade Organization.

💬 Hon Nathan Guy: He said it’s a falsehood.

And he said it’s a falsehood. The National Opposition members asked for the Ministry of Foreign Affairs and Trade (MFAT) to come before the select committee and that chairman, Dr Duncan Webb, used his numbers to stop MFAT coming before that committee. So there is no information before the select committee that this doesn’t breach World Trade Organization rules. I suspect it does, and for a country like New Zealand that’s built a reputation second to none around being free traders on international rules, that in itself is a possibility.

The question that should be asked, as we conclude this debate, is who benefits? Who benefits? Well, I’ll let Duncan Webb tell us that because I’m sure he knows. But I suspect it’s one or two very large domestic processors. I know one of them to be the wealthiest man in New Zealand, Graeme Hart. He just happens to be a contributor to the New Zealand First Foundation. That’s in the public arena. I just hope we’re not seeing a situation where, again, we’re seeing big money determining policy in this place, because we had the issue last night, and I suspect it’s true, around the fishing industry.

💬 Dr Duncan Webb: I raise a point of order, Madam Speaker.

💬 DEPUTY SPEAKER: Yeah, I’ve anticipated the point of order. As you saw, I was remonstrating with the former Speaker, who I’m sure is well aware of the Standing Orders. He is traversing into a very delicate transmission—well, transgressions in the Standing Orders, as he well knows, by implying that they are being influenced by outside—the Government’s being influenced.

I would definitely not be saying that, Madam Speaker. It would be dangerous to say that. What I am saying is that this House needs to examine very carefully who benefits from this legislation. There are two possibilities in my mind. One is the big investor in the New Zealand domestic forestry scene. They potentially benefit because their logs come in at a cheaper price. The other potential benefactors would be a few smaller sawmills—

💬 Erica Stanford: Whereabouts?

—marginally operative, probably operating in the Northland electorate, for example. They are the only two sectors in my mind who benefit from this ridiculous legislation. Let Duncan Webb prove that I’m not right.

I’m really surprised, Mr Carter, that you appear to have come to the House without the bill, because pretty much everything you said there was addressed by the very robust select committee. Well, if you’re waving it around, you should have read it.

The very first thing I’ll say—all this nonsense about price fixing. Now, look, the bill, when it came to the Environment Committee, had room for improvement, and that’s exactly what we did. And section 63ZZC(2A), in clause 7, now makes it abundantly clear that setting of prices is not something that can be done by regulations. No matter which is properly for commercial agreement can be set by regulations. So that is absolute nonsense and scaremongering, and I’m, frankly, surprised that a member of that seniority would bring that kind of material to the House.

This bill, its purpose is set out very clearly as equity of access—making sure that the market is transparent and fair. Don’t worry, Mr Carter. I’m not quite sure how big your landholding is, but, unless you are logging 2,000 cubic metres or more a year, you are entirely exempt from this bill. This is not about small holdings. No—another bit that you forgot to look at.

As for the World Trade Organization, that shibboleth has been thrown up time and again, and I have asked repeatedly: point me to the place where the breach occurs. I undertook some research, and it’s quite right that there are many provisions which talk about open markets, including the elimination of quantitative restrictions. The fact is that you can’t place restrictions on how much can be exported—whether it be beef, logs, or anything else. I read the bill—went through it with a fine-tooth comb. Nowhere in the bill is there any transgression of the quantitative restrictions provisions of the General Agreement on Tariffs and Trade. It’s just yet again the National Party throwing up nonsense, scaremongering, and pretending the bill does something it doesn’t.

This is a good piece of legislation. There are some ratbag traders out there. There are some poor-quality advisers out there, and our logging industry needs to be done fairly, properly, with high-quality advice and robust trading. That’s what this bill does. I’ll commend it to the House.

It’s a humiliation to watch a member of the calibre of Dr Duncan Webb come to this House and have to defend and apologise to this House, effectively, for a shoddy, shameful, shambolic piece of legislation of this sort. It’s a crying shame that someone of the calibre of Dr Webb is not currently in Cabinet, nor his predecessor as chair on that committee, Deborah—the current member for New Lynn—

💬 Dr Deborah Russell: Russell—Russell.

—Russell; that’s right. How quickly we forget. Once they leave the lofty heights of the select committee chair, how quickly we forget. Dr Deborah Russell would have chaired that committee completely differently, because, as the Rt Hon David Carter said, it was a shambolic process. It was short, it was brief, it was incoherent, it was insulting to the 650 submitters, who, at very short notice, presented to the committee, and a massive 640 of those submissions were opposed—implacably opposed—to this bill.

What really is going on here is the bigger question of coalition politics. First of all, this bill was introduced, surprisingly, as a Budget urgency piece of legislation. It’s got absolutely nothing to do with Budget 2020, but here it was, under urgency, as part of the Budget legislation introduced into the Parliament without notice, and, really, the question has to be asked: why? Well, when we tried to find out why, the answer actually goes to coalition mismanagement, and another bill, we were told, actually couldn’t come in, because the coalition couldn’t get agreement from the three coalition parties. So this bill had to be rushed in at the last moment. So, rushed in under urgency, rushed in under the guise of the Budget debate—

💬 Barbara Kuriger: Just like the last one.

—and, as my colleague Barbara Kuriger says, just like the last one. And then we had a bizarre situation where the select committee that was chosen by the Government to consider this bill was the Environment Committee—of all committees. Why? Why would that be? Forestry matters in this House have always been the purview of the Primary Production Committee, and that’s where this bill should have gone. But, clearly, the Government didn’t want to have the scrutiny that would have properly been applied at that committee, rather than the rather shoddy, quick, and hasty process that was conducted under the chairmanship of Duncan Webb in the Environment Committee. So this bill is a bit of a shadowy bill because there are so many questions that are left unanswered.

Now, on the face of it, it seems that the initial purpose of the bill would appear—on the face of it—to be sort of quite benign, and the purpose says, “to establish … a registration system for log traders and forestry advisers”. Now, we supported the bill at first reading, under urgency, as part of the Budget debate, without having had an opportunity to quickly and fully discuss matters with the sector. But it became very apparent very quickly, as soon as we started having those negotiations and discussions with the sector, that they were implacably opposed to this piece of legislation. The Rt Hon David Carter rightly asks who benefits. “Follow the money, honey.” I think is the correct phrase—“Follow the money, honey.”

💬 Michael Wood: I raise a point of order, Madam Speaker For the second time in this debate, a National member has made a clear implication that money is motivating the votes of members in this House on this particular bill. I find that offensive, and it should be withdrawn.

ASSISTANT SPEAKER (Hon Ruth Dyson): I heard the previous Speaker before I came to the Chair warn the member who was speaking at the time on that very issue, and I’d ask the Hon Scott Simpson to desist and carry on with your speech. Thank you.

💬 Rt Hon David Carter: Very sensitive!

Thank you, Madam Speaker—

ASSISTANT SPEAKER (Hon Ruth Dyson): Sorry. The Rt Hon David Carter knows better than that.

💬 Rt Hon David Carter: I was just talking to my friend. I raise a point of order, Madam Speaker.

ASSISTANT SPEAKER (Hon Ruth Dyson): You’re absolutely entitled to have friends; you’re absolutely entitled to have a conversation with them. But you’re also well aware of what you just did.

Tim van de Molen: Take a point of order.

💬 Rt Hon David Carter: I did!

Was it resolved?

💬 Rt Hon David Carter: I’m not allowed to talk to my friends. It’s not on!

ASSISTANT SPEAKER (Hon Ruth Dyson): You can talk to both of them.

So the industry, it turns out, were not consulted on this bill, not consulted on the implementation of it, and not consulted as to why the Government thought it was needed in the first place. The Minister is, effectively, saying—and I tried to glean from his speech earlier in this debate something tangible, something meaningful that we could hang some kind of debating point on, but it was typical of the Hon Shane Jones. It was a speech of fluff and verbiage and rhetoric that actually didn’t say anything. So he spoke for a long period of time without actually giving reasons why this bill should be passed. But, as I understand it, the Minister is, effectively, saying that it’s his way or the highway in terms of this piece of legislation. He’s saying that he wants a change made, and the question has to be: quite why?

Well, I think that the Rt Hon David Carter made that very clear in his speech: there are a handful of sawmillers who, for some reason or other, feel that they are being disadvantaged by an open and free market, disadvantaged by foresters being allowed to decide for themselves when they harvest their trees and who they sell them to. Somehow the Minister of Forestry, the Hon Shane Jones, sees that that is some kind of sin and something to be overridden. At the core of this piece of legislation are property rights issues, and the property rights issues go to the foresters who should, in my view and the view of the National Party, be allowed the harvest the logs when they see fit, due to conditions and market situations that they feel are appropriate, and then also to sell those logs either domestically or for export if they wish. The role of Government in that process should be zero, should be nothing. The Forest Owners Association has labelled this new bill as an “avalanche of clipboards”, and what they mean by that is that it’s a piece of bureaucratic nonsense. It’s going to add cost, add red tape, slow down the process, and it’s not going to give the value that the sector needs, or the certainty that the sector needs.

I want to refer to the paper and analysis that was done by none other than the New Zealand Institute of Economic Research (NZIER) on the bill, and they made a number of very pertinent and appropriate points. They made the point, in terms of their summary, that the proposed remedy being proposed by this bill is forced diversion of the current export trade in logs to local processing. And why would that be? It would be, certainly, because local processors are actually, in some cases, inefficient—not all of them; many of them are very efficient. Many of them manage very well, but there are a small number and, as the Rt Hon David Carter pointed out, located primarily in—guess where! Oh, Northland! No surprises there. And what we find is that those processors allege that they have difficulty sourcing logs. So this Minister comes along and says, “Well, I can fix that. We’ll pass some law that will regulate the process, and we’ll get the advisers to actually advise foresters what to do. And if they don’t follow the advice, well then, there will be repercussions.”

The New Zealand and overseas experience that the NZIER points out is that, in this case and in others, not just here in New Zealand but overseas as well, heavy-handed industry policy interventions are unlikely to succeed. That’s what they say: “Heavy-handed policy interventions are unlikely to succeed.” They go on to say, “Our experience with industry policy schemes show that they are fraught with problems. The administration costs are likely to be high.” That’s the point that the Forestry Owners Association made: that this is a bill that adds cost, doesn’t solve a problem—because there isn’t a problem to solve unless you are one of a handful of log processors who are inefficient and not able to operate in a way that is competition—and NZIER says that there is some confusion about what this bill is trying to address. Well, that’s the point the National Party made in select committee, given the very short period of time that we had.

But one of the bigger concerns actually relates to the blocking of the request by the National Opposition in select committee to seek Ministry of Foreign Affairs and Trade (MFAT) advice on the World Trade Organization implications. Now, the Minister dismissively wrote those off as if they were of no importance and no consequence, and here we have again a Government Minister just dismissing—just dismissing—criticism: hear no evil, speak no evil, see no evil. If you don’t acknowledge it, it can’t be so. It was the select committee chair, in his capacity as chair, who blocked the opportunity to have MFAT officials come and brief the committee on the very important and potentially damaging impacts of the World Trade Organization considerations around this bill. We oppose this bill. We think it’s bad law and it’s unnecessary.

Like a stand of mature Pinus radiata, the chair of the Environment Committee, Dr Duncan Webb, cut down every single spurious argument that was put forward by the Opposition in respect of this bill. Nothing that Dr Webb said in that respect was even addressed or refuted by the previous speaker, Hon Scott Simpson. The reality is that this is a bill which brings a registration system and good professional standards of the kind that we have across many other sectors into one of New Zealand’s most important economic sectors. It’s a good bill which will bring a greater level of professionalism and certainty to the sector, and I commend it to the House.

Spoken by a member who didn’t have a clue what he was talking about—a member who was nowhere near the truncated Environment Committee—

💬 Hon Scott Simpson: Usually the case with that member.

—yeah, well, usually the case with that member—he was nowhere near the truncated select committee which was so poor a piece of process, but is, regrettably, becoming all the more common, as we see in the dying days of this New Zealand First - Greens - Labour coalition Government. The fact that that member had not a copy of the bill anywhere near him when he spoke but merely thought of some words in support of his chair, I think, means that the House and the public of New Zealand who might be watching this debate can safely put that contribution to one side.

This side of the House can’t put any contribution off to one side, because the implication of this Forests (Regulation of Log Traders and Forestry Advisers) Amendment Bill will have an impact on forestry and logging operation in New Zealand, an impact on an industry that doesn’t support it, wasn’t asking for it—in fact, I’ll go further than that—and have actively opposed the very foundation of this bill, which was brought to the House by Shane Jones. The cornerstone for me is the imposition of the requirements of registration and compliance in an industry that is already heavily regulated by health and safety requirements.

We heard, in the development of the health and safety at work legislation three or four years ago now, the imposition of those safety requirements on the logging and forestry industry, and, in our view, the health and safety at work legislation was the proper way to regulate an industry that is well known to be ranked among the most dangerous industries in New Zealand. To be regulated now under this bill, for no good reason, does two things. It further ties up that industry, and somebody made the quip that what we have now is that in every forest there’ll be a man with a clipboard. Yes, there will. But, actually, there will be a man or a woman in every forest and in every log trader’s office with two clipboards, and if we don’t think that is a bit of overkill on behalf of this Government, well, I can tell the House that indeed it is.

This is an industry that didn’t want the legislation, actively opposed the legislation. The Government could provide no real reason for the legislation. It has had one of the worst processes in terms of its democratic process through this House. Well, I would’ve said that except that this process is becoming all too common under this New Zealand First - Greens - Labour coalition Government.

💬 Rt Hon David Carter: Not for much longer.

Yes—thank you to that member—not for much longer. National opposes this bill.

E Te Māngai, tēnā koe. Tēnā koutou e Te Whare. I stand on behalf of the Green Party of Aotearoa New Zealand in support of this Forests (Regulation of Log Traders and Forestry Advisers) Amendment Bill. The Hon Jacqui Dean will be stoked to know that I do have a copy of the legislation in front of me and on my desk. I was also a member of the Environment Committee alongside the Hon Jacqui Dean and other members in this House in consideration of this bill.

I have just been reading through some of the notes as background to this legislation, and I think just another fun fact to add to the mix is that this bill proposes to amend the Forests Act 1949. We’re not often dealing with pieces of legislation or amendments to them that are that old, and with that in mind, I think that the commentary as espoused by the likes of my colleague Michael Wood around the opportunity that this bill presents to professionalise and to update this sector is something that is kind of long overdue. Ultimately, what this does is present a registration system and it also enables greater transparency in the way that the sector operates. There’s a registration system for forestry advisers and for log traders who buy, trade, and export logs.

Throughout the 2017 election, I was alongside members and candidates from a range of different political parties, and I also found it interesting that one of the most common examples that we used of the flow of money offshore that we could better capture in our domestic market was around wood processing. Pretty much every single political party spoke about the potential to finish products here in Aotearoa New Zealand, and that we needed to step up and implement processes to do that better. What this legislation does is enable a pathway to get to that so that we can capture greater value here in our domestic economy.

So a lot of the points as to why this legislation has come to the House today have been thoroughly canvassed, and I guarantee that you’ll hear a rip-roaring speech from the member of the Opposition who’s already preparing to launch up. But the Greens do support this Forests (Regulation of Log Traders and Forestry Advisers) Amendment Bill. It’s pretty straightforward, pretty common sense, adds some transparency to the market, and also regulation and professionalism. Kia ora.

A graceful ascent—thank you, Madam Speaker. I rarely launch myself out of my seat—actually, no, I do, probably. That’s probably a fair comment. I would normally always start my speeches by saying I am pleased to take a call, but I have to say I am not pleased to take a call today on the Forests (Regulation of Log Traders and Forestry Advisers) Amendment Bill. The reason I’m not that keen to speak today, or not happy to take a call, I should say, is that this is a dog of a bill.

Let’s start from the very beginning. We got this bill under Budget urgency. It was the second bill introduced under Budget urgency. We’re in the greatest economic crisis of our lifetimes, the like of which we will probably never see again and have not seen before, certainly in our lifetimes, and we have a Budget that’s delivered that is borrowing record amounts of money—tens of billions of dollars—to go some way to solving the crisis we find ourselves in. We would expect to find that the bills that are put forward under Budget urgency would also go, in some way, to helping us through this serious economic crisis that we find ourselves in. And yet what do we find is the second-most important bill under Budget urgency? It’s this bill. It’s the bill to regulate the industry. It’s the regulation of log traders and forestry advisers. It’s very interesting timing, given that, as I said, we’re borrowing tens of billions of dollars, and here’s a bill that is, as Chlöe Swarbrick just pointed out, a bit of a tidy-up in some legislation that is quite old and regulating an industry. How on earth this ties in with our COVID-19 recovery and Budget urgency, one has to wonder.

As has previously been mentioned, there are many, many problems with this bill that were pointed out by the submitters, but the main problem was the rush. I’ve already mentioned that it was put under Budget urgency. Why on earth that was the case hasn’t been answered by the Government. There are no reasons given by them whatsoever; not a single speaker has been able to stand up and say why this bill was introduced under Budget urgency. To give submitters six days, or four working days, in reality—four working days to provide a submission—now, it’s really important we all know it’s not just about writing a submission and sending it off. It’s about understanding the consequences of the bill—reading the bill. It’s not a small bill, and it was extremely poorly drafted on top of that.

As Duncan Webb and also Shane Jones pointed out, a lot of work—a lot of work—went into this bill at select committee. So you can imagine the poor submitters reading and trying to understand this bill, which was hugely complicated, which in its purpose says things like it’s to “support the continuous, predictable, and long-term supply of timber”, and then has all these regulation-making powers at the end. The poor submitters didn’t know what that meant, and they all assumed that that would mean that the logs that they were producing would have price fixes on them, that they would be forced to supply the domestic market and not the export market, and that the choice would be taken off them. So you can imagine the number of submitters that were very upset by this bill. They had to read what was a bit of a mess of a bill, get their head around it, and then submit in such a short time frame for absolutely no reason.

I’m going to read out some of the comments from the submitters in a moment, but if you go back and read the regulatory impact assessment (RIA), they also make these points. They acknowledge that the Ministry for Primary Industries (MPI) had not been able to undertake a full formal public consultation process, that there should have been a longitudinal study, and that that would have been a much better process. They continue right throughout the report in saying that it would have been preferable to define the magnitude of the problem for growers and to explore the full nature of the issue. They accept that this longitudinal study would have been preferable. This is a theme that is right throughout the RIA, and it was a theme that was carried on with the submitters as well.

Without fail, every single one we saw, first off the bat, complained about the fact that they had no time to understand the bill and no time to get a submission in. They felt rushed. They were aggrieved, they were angry, and they were confused. We put the question to them, time after time, with each submitter: did you know this bill was coming? Were you consulted on this before it came? And, without exception, they said they had no idea. They were blindsided by this bill. And then the indignity of only having a few days to read it, understand it, get a submission in, and come and talk to the select committee—it’s an appalling process. You can just imagine, if the shoe were on the other foot, the conniption that the Green Party members would be having if the National Government were undertaking such a process for a bill under Budget urgency, when it can’t be explained why it’s under urgency. They would be hitting the roof. But here they are saying, “It’s a perfect process. No problem, we’re all happy. Let’s pass it through.”

The reality is almost every single one of its submitters that we saw was opposed to the bill. There were 650 who managed to put in a submission. That just shows you how incensed they were with this bill that there were 650, only given six days, who managed to get their submissions in. That’s how incensed they were, and 640 of them were opposed to the bill. And they weren’t just mildly opposed, were they, Mr Simpson?

💬 Hon Scott Simpson: They were strongly opposed.

They were strongly opposed. In fact, the language in some of those submissions was very strong. It was very strong about the intentions of the Hon Shane Jones. They called into question many things, and we sat there and had to agree with them, because we also were confused about the speed of the bill and why it was a rushed process. We’d read the RIA.

💬 Hon Scott Simpson: Never adequately explained.

Nope, never explained. It was very interesting, actually, reading the RIA, because it also points out that the MPI commissioned Forme Consulting Group and Scion in early 2019 to examine the log-supply constraints that were emerging in—guess where!

Tim van de Molen: Where?

Guess—guess, Mr van de Molen. In Northland. That’s where they undertook their research. So the overwhelming evidence that we saw in select committee—it didn’t matter who we were speaking to. Growers, processors, sawmills—no matter who we were speaking to, they were saying, “This is not an issue where we’re from. There’s no issue with supply in our region. There’s no issue that we can see with dodgy advisers. We don’t understand the need for the bill.” And it didn’t matter which submitter we had: they all said the same thing. And it makes a lot of sense, when you look at the RIA and you understand some of the background to the bill, that the problem only seems to exist in one place.

💬 Hon Scott Simpson: Where?

In Northland. And it’s just coincidental! Well, it’s not coincidental, but the member whose name the bill is in, the Hon Shane Jones, is from—guess where! Northland. So we are suspicious of the intentions of this bill, we have to say, because there wasn’t a single submitter anywhere else in the country who said there’s a problem with supply. They all, in fact, said, “Well, you know what, there are some sawmills that aren’t efficient that need to come up to modern standards.”

💬 Hon Scott Simpson: Haven’t invested.

“They haven’t invested. They don’t talk to the growers enough.” But this isn’t a problem such that we need to tar the whole country with the same brush because of a couple of sawmills in that member’s electorate that he’s trying to win. It doesn’t make any sense.

Many submitters called this bill a Trojan Horse that had other recommendations that were not in the title of the bill. They were concerned with what the problem was to solve. They said there would be increased costs to the sector. It’s a sector that has very low returns anyway—we’re talking 5 percent—and this is a bill that is going to increase costs and red tape and add extra processes that aren’t required. Many people said that there is already a regime in place, a voluntary regime where you can go and get registered. And if you want to use a registered person—and you should use a registered person—well then, you can already find one. There is no problem to solve. They also asked why the bill was under urgency. As I mentioned, they said that they were rushed.

What the chair of the Environment Committee, Mr Duncan Webb, said, which was that this whole issue around the World Trade Organization potential breaches was only cooked up by the National Party, is rubbish. The reason it came to our attention is that submitters brought it to our attention, and it was never properly addressed. MPI said, “We don’t think there’s a problem”, and Duncan Webb, obviously, went away and did his own research. Well, good on him. But, I tell you what, we asked for the Ministry of Foreign Affairs and Trade (MFAT) to come to our select committee. I put the motion. We were about to deliberate that day. In fact, we ended up deliberating on Monday. So we had the time to bring MFAT in. We had time. We could have brought them in on Monday before we deliberated, and he blocked that—well, we put it to a vote, and that was voted down. He didn’t want them to come in. Now, why that is, I have no idea. If he was confident that there were no breaches because of his own research, well, there was no reason not to bring in MFAT to put our minds at rest. It wasn’t the National Party that brought that up; it was submitters.

This is a rushed bill. It’s a bad bill. There are reasons that this bill has been brought to the House that we will never know, perhaps.

The following call is a split call. I call Dr Liz Craig.

Thank you, Madam Speaker. It’s a pleasure to speak on this bill. Basically, I sat on the Environment Committee, and it was a good example of listening to submitters. As a result, we’ve made a number of changes which have strengthened this bill. I want to just take you through, quickly, a couple of them.

I think the first one has already been traversed well in the House, but there were a number of people who raised the issues about our compliance with international trade obligations. As my colleague Duncan Webb has indicated, on this side of the House we were quite satisfied that this was not the case. But what we did do is put an avoidance of doubt clause into the bill, around when you’re making rules for forestry practice standards, that these rules may not impose any condition that is properly the matter of a commercial agreement between parties—so just making it very clear that that is the case.

We also made another couple of changes around, basically, making sure that small-scale log traders, Christmas tree operators, and small-scale firewood operators were exempt if they were dealing with less than 2,000 cubic metres per year and also looking at some of the ability of the forestry authority to have delegated powers to make rules looking for greater ministerial oversight. So, in a number of places, we have made changes which insert “on recommendation of the Minister” so that the Minister has got oversight over those rule-making powers.

So we are happy. We’ve made good changes to the bill, strengthened the bill. I commend the bill to the House.

Thank you, Madam Speaker. It’s amazing to think that we’re here talking about this bill, a bill that was not asked for by the industry, that the industry had no idea was actually coming, and, now that it has come, the industry is strongly opposing. But nevertheless, we heard from the Green Party that this was an important opportunity to professionalise the industry, which is actually code for “bring in Government control and regulate the bejesus out of it”, and that’s what we’re seeing come through in this particular bill.

There is no need for this. There was a total lack of consultation. The regulation impact will actually be far reaching and impose unnecessary compliance costs and issues arising out of that. It requires all scientists, all consultants—basically, anyone involved in the industry; machine operators, for example—they’ll all have to be registered as a result of this as well.

So it’s been poorly thought through, and that’s no surprise when we look at the process it’s followed, where it’s been rushed through the first reading in Budget urgency, bizarrely; a very truncated select committee process, and we’ve heard about that from Erica Stanford—and actually, I thought it was really indicative of the high level of feeling, that number of submitters being able to get themselves in order to make a submission on this in a very short manner. An overwhelming opposition to it shows that it was not wanted. I guess, as reflected through the fact there was no consultation, if those people involved in the industry, those key people at the coalface, had actually been approached, then it would have been very clear to the Minister there was not widespread support for this piece of legislation.

That select committee process is something we’ve seen a disappointing trend of from this Government, and it goes, to me, to the fundamental issue, which is around the Government’s arrogance that they know best for all of these industries. “Stuff what the industry themselves have to say about it; the Government knows best.” That seems to be the ethos on the other side of the House, and we’re seeing, time after time, bills are rushed through the process unnecessarily, and as a result we end up with something that does not align with what industry wants. Often we end up with errors, and we’ve seen a litany of those over the last few weeks, especially yesterday and last week, in terms of some of the legislation that’s been passed through.

One of the concerns that I had around this particular select committee process as well was the fact that Government MPs opposed bringing in Ministry of Foreign Affairs and Trade officials to give a detailed insight of the potential impact this has on our trading agreements through the World Trade Organization. That’s a really important step. We are a trading nation. We rely heavily on those international agreements. For the Government to oppose getting that sort of advice is outrageous. I cannot understand their position on that, and it’s simply unacceptable. The industry deserves that sort of representation, especially in a truncated process like this, and we simply haven’t seen it.

Effectively, this bill is just enabling the Government to create regulations to control where and when growers supply the market, and that could, potentially, have impacts on our trade agreements.

💬 Dr Duncan Webb: Read the bill.

And the member on the other side of the House might speak glibly about that, but that is a serious consideration for us from a trading perspective. The compulsory registration—there are major issues within this, and we’ve seen that highlighted by submitters throughout the process.

Yet again, it seems that they have gone off half-cocked on a piece of legislation at the whim of Mr Jones, who is actively trying to win a seat up North, where there are forestry representatives—the forestry industry is an important part of it. It’s a half-cocked piece of legislation that doesn’t meet the actual needs—once again, trying to impose something unnecessary. We saw that, what was it, 12 months or so ago, where he was trying to roll-out a large planting plan of pines up there and it fell flat on its face and they ended up mulching all those seedlings into the ground—now, just another example of the Government trying to go in thinking they know best, and failing miserably.

So I would suggest that the actual only value in this bill, because it’s been so strongly opposed by the industry, is the pieces of paper that it’s actually written on, coming from those trees. So we do not support it. We cannot commend this sort of legislative process. It is simply disrespectful to the industry. It does not meet their needs, and so we oppose it.

New Zealanders, wherever they drive, whether they’re going past wharves today, they’ll see great logs—piles of logs—on their local wharf. If they drive around New Zealand, they’ll see logging trucks. It will come as a huge surprise to them that there is no regulation around that. There are some 14,000 to 15,000 small-forest owners who’ll contribute 40 percent of the annual harvest this decade, up from 14 percent. This is a moving industry. It does need regulation, and this is very good law. I commend this bill to the House.

Oh, Mr Speaker, what a shocking speech that was. I’m not even sure—

ASSISTANT SPEAKER (Hon Ruth Dyson): You can do “Madam Speaker”, if you like.

Madam Speaker.

ASSISTANT SPEAKER (Hon Ruth Dyson): Thank you.

Sorry. I’m not even sure that that member even read the bill. He was obviously working off the talking points that had been given to Labour MPs. It’s really interesting to hear, this morning, that Government members are taking very short calls on this bill, and I’m not sure why. I think it’s because they’re quite embarrassed to be supporting this bill.

On this side of the House, National have real concerns about process, about World Trade Organization (WTO) potential, implications, about the number of submitters that we had opposed to it, and all of the Zoom sessions that we had to have through a recess period is not ideal. It’s not good democracy. If the Government was serious about this bill and supporting the Minister, you would have thought that they would have wanted to have a fair and balanced select committee process.

So let’s just recap. This was part of an urgency motion following Budget 2020 on 14 May. Then the Environment Committee—and I heard the Rt Hon David Carter give a very good speech earlier on, saying why on earth would it have been instructed to go to the Environment Committee when really this bill should have been heard, like all other forestry bills, by the Primary Production Committee. So that’s the first question mark.

The second one was that the clerk then had to open up submissions on 15 May. Would you believe; they closed at midnight, 21 May! Six days to allow one of our biggest export sectors to be able to submit on this bill. It went through a weekend. Isn’t that an atrocious process for this Parliament? It’s no wonder heads are down on the Government benches when I say that. Six days for submissions! There were 640 submissions received; only 11 opposed.

Why on earth would the Government want to be forcing this bill through now ahead of the election? There’s been very good questions raised by this side of the House this morning, but none of those questions have been answered by the Government benches. And for the Minister to come in and imply that all foresters—whether they are small-block owners, whether they’re large exporters—are cowboys is an insult. It’s a bit like when Shane Jones stood out here on the forecourt of Parliament addressing thousands of farmers that marched through the streets of Wellington worried about forestry hollowing out rural communities. What does Shane Jones say to those people? “You’re a bunch of rednecks.” Actually, he didn’t have the guts to say that on the steps of Parliament; he said that afterwards to a little media scrum. So for Shane Jones to carry on with his rhetoric and say that pretty much the forestry industry is full of cowboys is a real insult.

What this, basically, does is set up the framework for the Minister to be able to tinker, through regulations, to restrict logs being exported, to support domestic supply. Now, in my mind, that’s going back to the 1970s or 1980s where the Government is meddling in a free market. We don’t agree. That doesn’t sit comfortably with us on this side of the House and that didn’t sit comfortably with those hundreds of submitters.

The other aspect that is really fascinating. Remember, prior to this bill the Minister was out there sort of spruiking the industry, that he wanted to bring in a tax on raw log exports. So what happened is he got some very short and sharp advice from the Ministry of Foreign Affairs and Trade (MFAT) and Ministry for Primary Industries (MPI) and a lot of it was redacted when it went out, as part of this process, to submitters. What it basically said is if you put—not you, Madam Speaker, but if the Minister or the Government puts a tax on raw logs, they’ll be hauled in front of the WTO. So the Minister backed away from that, talked to his officials, and he thought: how, actually, can I restrict export supply to support and prop up domestic mills? So this is the halfway house, this bill. This sets up the framework to allow the Minister to set the regulations to restrict supply through export logs to benefit those domestic mills. I have some real concerns about that, because in my mind, that will mean that the New Zealand Government will be hauled in front of the WTO.

Now, I heard Vangelis Vitalis, who is one of our best trade negotiators, currently working at MFAT, highly ranked, highly regarded around the world. I heard him give an address at the meat sector conference in May 2018—this is way before COVID. He said it’s been the worst rise in trade protectionism in 2018 in 23 years. Let’s fast forward that now. COVID’s upon the world. There’s more protectionism happening around the world that’s going to make it way more difficult for our exporters to actually be match fit and compete against other countries. So there’s a high level of uncertainty amongst the forestry sector that this bill has the potential to be hauled in front of the WTO.

Just in that example alone, there were 400 new protection measures in the month of May 2018. There’s hundreds more. There’s thousands more that we are now having to deal with. Now, the cost for the wider agriculture sector from these non-tariff barriers is $6 billion a year. It’s higher than that now. That’s what the industry is facing. Now, the National Government brought in the free-trade agreement with Korea. Ninety percent of forestry exports are tariff-free. The 10 percent outside of that are going to be eliminated over the next nine years. That’s a fantastic free-trade agreement.

This one is going to put sand in the cogs and slow down an open New Zealand economy that we rely on. We’re going to rely on our exports more than ever. Our forestry exports, our dairy exports, our meat exports, our horticulture exports are going to help to pull the plough for the New Zealand Government to get the debt down and get our economy growing again. This bill is not going to help that. It’s not going to help that one iota.

I also want to talk about—I was the one that raised it in the select committee and said, let’s get MFAT officials in, and the chair said, “Oh no. No—no.” Admittedly, I raised it on the last day that we were deliberating. So the chair said, “No. Not good due process.”, and I sort of took that on the chin. But I said to the chair and the rest of the committee, “Why can’t we get MFAT in after the bill’s been deliberated on?” That’s fair enough, in my mind. That was fair enough in the National Party’s approach on our side of the committee—“Let’s get MFAT in to understand what they think about this bill.” We were blocked. We were blocked every step of the way. We had advice from MPI trade, and I know MPI trade officials; they’re very good. But we didn’t hear from MFAT trade officials, who I think would have given us a different view and their concerns about this bill.

So we’ve got a lot of questions. If the Government wants to carry on pushing this through, we’ll have hundreds of questions that we’re going to put to the Minister in the chair. And, actually, the last period of time, where it’s been good interaction with the Ministers in the chair and the Opposition, I commend. So I’m hopeful that we’ll have a good engagement if the Government wants to forge ahead in this.

Just in the last few seconds I have, National doesn’t support this bill. We’ve got grave concerns about it. It was interesting to hear the Minister say that after the election it’s likely that politicians will want to restrict the ability of forest investors to expand their holdings into productive farmland. That’s a nod that Shane Jones and Damien O’Connor and James Shaw are getting a huge amount of pressure. I welcome that debate. Actually, we should be having it now, not after the election. It will come up in the election campaign. We want to make sure that farmers and foresters get a fair go, and this bill does nothing to help them.

Thank you, Mr Speaker. It’s great to be able to stand and speak in support of a bill that has flow-on benefits for our regional economies, including increased employment opportunities. And I would actually like to say congratulations to the Environment Committee for the work that they did on this bill, because having looked at the original bill and the bill that’s come back to the House now, I’m just amazed at the work that they’ve done. It’s a great bill, and I have no hesitation in commending it to the House.

The question was put that the amendments recommended by the Environment Committee by majority be agreed to.