Estimates Debate — External Sector

Members, I understand the responsible Ministers are available to speak to the Votes in the external sector. Therefore, the question is that Vote Customs, Vote Defence, Vote Defence Force, and Vote Foreign Affairs stand part of the Schedules.

Thank you very much. I understand as the Chair I have to be slightly—

💬 Erica Stanford: Thank you very much!

“Thank you very much!” Yeah, I’ve never really been any good at mimicking. I have to be relatively neutral, so this is going to be—I’m sorry, Minister—somewhat familiar, but also boring at the start, but also very important.

If I could, though—on behalf, as far as I can, of the Foreign Affairs, Defence and Trade Committee—I thank all those officials, civil servants, and, obviously, those who serve for what they are doing. If I’m going through in order, I’m very conscious of the work that the Ministry of Foreign Affairs and Trade (MFAT) has been doing, particularly around the COVID crisis. I think, too, it would be fair to say, for those members of the committee, great work providing us advice. It always goes without saying, but it must be said to our defence forces and to those in the Ministry of Defence: for the service that they give the Realm, we are grateful as well—as too to those in Customs. Things are—we could debate whether it’s quieter or not for them; let’s just say different. But we’re very grateful for the work that they do at the border.

It won’t surprise you that when we looked at the Vote for foreign affairs, a big amount of focus was in and around COVID. There was a lot of interest from the committee on how that was being managed and, in particular, how New Zealanders were able to come home and what assistance MFAT was providing to our friends and allies and others around the world to get their people repatriated. We were grateful to see and understand now, Minister, that particularly in the diplomatic core, they are able to travel. They always were, around New Zealand, but they can now, if you will, refresh their missions. But I will signal it was an element that was beginning to come up in the committee, and the Minister may want to address it later around diplomats and their families—they’ve been isolated from their families for a long time, particularly when you’re thinking of their sons and daughters and so forth—of whether MFAT’s looking into that.

There were, obviously, discussions on the committee around the various free-trade agreements, particularly around the EU and the United Kingdom, and, of course, a lot of questions were being raised around Hong Kong. Again, members during the debate might bring up the specifics of that, but the committee, at the time, was very, very interested about how New Zealand was approaching the laws imposed by the communist party of China on Hong Kong, and perhaps it will be commentary later, that I can’t do now, of just how the Government’s reacting with that. And I’ll signal too to the Minister: the Asia-Pacific Economic Cooperation loomed large.

💬 Defence: obviously, a lot of focus was on the new assets that were purchased. I’ve been happy and on the record, even as a member of Her Majesty’s loyal Opposition, to acknowledge that the Government has funded a new fleet of P-8s. We’re going to be purchasing the C130Js. I’m really pleased to see the Bushmasters bought. The Minister will recall, if I allow the indulgence, us driving one in Kabul, as one does. There’s the sentence you possibly weren’t expecting tonight: “when I was driving in Kabul”. Obviously, you’ve had the Polaris purchased and, obviously, the frigate upgrade. But probably the biggest debating point in the defence area—or discussion point; always discussions on the committee of foreign affairs—was around the defence estate. I think there’s a general acceptance that it’s rundown, and I think all sides of the House in that committee were interested in how that would be better engaged.

Customs was the final area that we touched on as a committee—or the final one that I will address. A big element was, really, just questioning money. Customs does a great job, but the committee had noted there were no extra funds being given to Customs. That was seen as perhaps—I can’t speak for all the committee, but there was a line of questioning of the oddity that post-COVID, with the border as, if you will, our first line of defence, there didn’t appear to be any extra money, or, necessarily, planning. But the committee was very pleased, once we moved away from COVID, to see the continued work to try and address the drugs coming into the country but I think, really importantly, the sexual exploitation of children. I know that’s been a focus of the Government, or Governments, and the ministry, so that was seen as exceptionally positive.

So I thought it was robust as a committee, but we always work, I think, relatively collegially, so I acknowledge all those members as well. Thank you.

Well, Mr Chair. I will switch then to the political realm, now that I have finished my role as chair. I will switch to defence as a courtesy to the Minister. There are probably two things. To the extent he can, updating us around the frigate upgrade timings would be welcome. I don’t think he’s probably able to talk about capabilities. We don’t want to breach anything there, but if there are any indications. And it probably is that challenge, if he wanted to address it: what is going to happen with the defence estate? It’s completely understandable—opprobrium, if you will, could be thrown at the past, but I’m a great man for looking into the future. So I’d like to know what that Minister’s going to do. And if he could assure the committee around whether there’s still any planned closures of bases or merging—anything that he might care to discuss in these final minutes.

Thank you, Mr Chairman, and can I thank the chair of the Foreign Affairs, Defence and Trade Committee for that good round-up in both the foreign affairs and the defence conversations during the Estimates.

Coming straight to the point: the frigate systems upgrade. As the House knows, that project was kicked off as one of the first projects we undertook as the new incoming Government—around $640 million, I think, off the top of my head. That project has clearly, like a number of things, fallen victim to the COVID pandemic. There have been issues both in Victoria, in the port, with the company that operates the port, and with Lockheed Martin in terms of their ability under the COVID situation to progress work there. It’d be fair to say that we’re realistic and anticipated that there would be challenges. The project is behind schedule. I was very hopeful that we might see Te Kaha in all her glory sale into New Zealand in September. But at this point in time, the latest brief I can give the committee, Mr Chairman, is that we’ll probably not see the first frigate in New Zealand until February, and then Te Mana will follow in about 12 months after that—nine to 12 months after that.

I would say, from my visit to Canada and my inspection of both frigates that were in dock at the time, that the project has been a massive undertaking, a very complex undertaking, and, without going into details other than to say the frigate systems upgrade is aimed at improving the defensive and offensive capabilities of those two ships and extending their life out. I am fully confident from all of the briefings I’ve had that we will achieve that aim and that the Government of the day will receive back into service two highly capable frigates, which will service out till—I think we’re planning 2035, is the extension we’re looking for there.

In terms of the defence real estate—and I would share the honourable member’s desire not to get in and rotary hoe that paddock too much. The past is the past. Suffice to say, we’re sitting on about $2.1 billion worth of deferred maintenance and outstanding work. This is going to be a challenge not just to this Government but any future Government in cleaning that up.

In terms of the bases, the question around bases, I do not see any change to the current layout. Of course, Devonport is a live question and a live debate. I would simply say that we did initiate the first principles review of the defence real estate, prompted by a number of questions, challenges that the last Government faced, when people kept trying to take possession of Whenuapai, something that the former Prime Minister resisted; hence, we still have Whenuapai. We are facing challenges constantly from encroachment of housing, from people wishing to interdict the operations. This cannot be allowed to continue. So we’ve taken some very firm steps, and locking down and making sure that we do what we are able to, to continue to operate the defence forces, and, secondly, to look forward to the future to 2070 and try and get an eye and a picture on what sort of a footprint we need, in order that we are able to maintain the defence forces and give them surety and security of tenure.

A quick question: you talk about interdiction. It turned my mind, Minister, to, obviously, what happened around the Spratly Islands very recently, with the squadron of Australian—

CHAIRPERSON (Adrian Rurawhe): I’m sorry to interrupt the member. It has come time for me to leave the Chair. The committee is suspended until 9 a.m. in the morning.

Sitting suspended from 10 p.m. to 9 a.m. (Wednesday)