Taxation (COVID-19 Support Payments and Working for Families Tax Credits) Bill

Members, the House in committee for the Taxation (COVID-19 Support Payments and Working for Families Tax Credits) Bill. We come first to the debate on Part 1, which is the debate on clauses 3 to 7, “Amendments to Tax Administration Act 1994”. The question is that Part 1 stand part.

Oh, thank you very much, Madam Chair. What an unexpected pleasure to be National’s first speaker on this, the first part—

💬 Andrew Bayly: And a good looking man too, with a fine haircut.

Thank you very much. I’m not going to respond to any comments that are being made in the Chamber, Madam Chair, for fear of getting them into the Hansard.

I have a couple of questions first of all, and a little bit of it is my desire to be useful to the committee by asking the Minister to take an opportunity to explain clearly a couple of matters that might benefit from such clarification, and that forms part of the public record of course. And a little bit of it is that I actually genuinely don’t necessarily understand all the different parts. I would be embarrassed to admit that, except that, of course, with such a newly introduced piece of legislation, and one that has not been subject to much ventilation—as we’ve been saying in the last 24 hours in relation to another bit of legislation—I do genuinely think that I would benefit from understanding a bit better some of the way that the schemes intend to operate.

So, if I can take you and the rest of the committee first of all to clause 5, which is to replace sections 7AAB and 7AAC within the Tax Administration Act, which is, of course, one of the pieces of legislation being amended, I’d like to turn the committee’s attention to subsection (1), which talks about the purpose of the section being “to authorise the making of payments under the COVID-19 support payments scheme”, and so forth. It talks about a matter that is related to COVID-19, or a “circumstance, or matter, that is related to COVID-19”, and then it’s defined in brackets, in bold “(a COVID-19 circumstance), or by a group of COVID-19 circumstances.” Well, the second bit is probably easy enough—that would be, you know, a plural, more than one of a COVID19 circumstance—but I must confess I am still interested to know what a “COVID-19 circumstance” is. I presume that that’s a matter that’s defined in the parent legislation and, hence, in this amendment we are able simply to refer to that, or cross refer to that. But I wonder, apart from that relatively straightforward matter that I could probably look up myself, whether there is scope for that to change over time—and, for example, for the Government by way of policy that’s promulgated by Ministers and may be in a way that would be often the subject of secondary legislation, whether we might have the opportunity for updated circumstances that change in the way of a global pandemic and the Government’s response to it and the response of the people to the Government’s response, and so on.

So my question, in essence, is whether there is scope for the understanding of what constitutes a “COVID-19 circumstance” to change over a period of time. I wonder if the Minister can give some thought to that—in particular, whether the structure of the way the legislation is put together allows such a change, such an evolution of our understanding of a COVID-19 circumstance, and also, if he can give some examples of what a COVID-19 circumstance might be, particularly with reference to the current Delta outbreak but also with, potentially, subsequent future outbreaks, maybe variants. And I’m not going to embarrass myself with exposing my lack of knowledge of the rest of the Greek alphabet. But while I could, and anyone, in fact, with access to a Greek dictionary, and of course who doesn’t have one of those—we could all predict the names of the future variants. We don’t know when they’ll come. We don’t know exactly what challenges they’ll pose. We don’t know, in other words, what exactly a COVID-19 circumstance would be going into the future, to which such legislation would apply.

So that’s my first question, or a set of questions, if I may, and I’ll just sort of test with the Minister if he’s in a position to be able to answer them before I resume my seat, which I shall now in fact do.

Thank you to the member Chris Penk for the question. Clause 5 of the bill inserts a new section 7AAB that makes it clear that the new COVID support payment system has to be related to a COVID-19 circumstance. It’s broadly defined, but if COVID-19 was over as a pandemic, the right to make resurgence payments would fall away too, effectively.

Thank you, Madam Chair. Gee, we’re in for an exciting tonight. We’ve got Christopher Penk here, freshly shorn, looking good, Brylcreem in his hair, and we’ve even got the Minister in charge of the bill in the House, and it’s very good to see you, Minister Parker.

💬 Hon Member: I bet he’s got the right speech.

He has. I want to talk about one of my tabled amendments. I’ve got four of them tonight, and I’m looking forward to talking on each of them. The first one, the first one—

💬 Hon Member: We’re looking forward to it as well.

I’m just—again?

💬 Hon Member: We’re looking forward to it as well.

Oh very good! Thank you. I’m honoured. The first one I want to talk about is a change to clause 5(1), and it’s a new section 7AAB(3)(C). I want to insert and I’m proposing that we insert after (b)(i)—this is, I’m just looking at the Minister here just to help him reference it, 7AAB(3)(b)(i)—insert a third element which is to say that the change to the COVID payments needs to be made and announced by no later than 11.59 p.m. on Thursday, 25 November 2021.

As the Minister’s well aware, the Government has signalled its intent to shift to a new COVID framework at 11.59 p.m. on Thursday, 2 November. We think that it’s very, very important that businesses have the opportunity to know what’s going to happen to them. It is too late to leave it until 2 November. We think this should be brought forward so they’ve got the ability to plan much more quickly. We’re going into a Christmas period. People are going to have a huge amount of staffing issues, and they’ve got stock issues—how they get sufficient stock—because, at the moment, many of those businesses won’t even know whether they can open or not.

Of course, we’ve talked today with the Minister of Finance asking questions of him—both today and yesterday—about giving us certainty, giving business owners certainty around will they be operating and will they be operating under a red alert level or orange level? There’s no certainty. So we think it’s imperative that the business owners and their staff have much more clarity.

The Government has had a long time to prepare for this; they made the initial announcement on 22 October—that’s over a month ago. This is saying that it is wrong that the Government is still passing pieces of legislation without knowing and without telling people what to expect. Because we don’t even know what type of payment’s going to go forward and what they are proposing, because we do know that there will be a change; that is clear. But the changes are very unclear. So we think it’s important that this happens as speedily as possible so that businesses have got time to prepare. Businesses are not like armies and Government servants who can just swing into action; they have to make sure they’ve got everything in place if they’re going to be able to trade. As I said before: stock, people, marketing, booking media if they’re going to have to do it, all that type of stuff, all the key requirements if you need to reactivate your business quickly. Many of them have been in lockdown. As we know, I think tomorrow’s the 100th day of lockdown.

This is what we think should be happening. I’d love to hear the Minister’s response on this—whether, in fact, we should be bringing it forward—and if he’s not prepared to do that, can he tell us why he’s not prepared to do it? And, more importantly, when is he going to let business owners and their staff know what the new COVID rule changes and the financial support arrangements are going to be? Because most people wouldn’t have one iota, and, as the Minister knows, 65 percent of New Zealanders do not understand the proposed new traffic light system.

Sorry to disappoint the member, but we won’t be supporting that amendment, because it would ruin the legislative scheme and would effectively prevent decisions being made after Thursday, 25 November. It would, effectively, mean that future resurgence support payments, if needed, could not be made.

💬 Hon Member: Only if you don’t activate.

That’s not correct.

Thank you, Madam Chair. I want to raise a couple of points in response to the Minister of Revenue’s last intervention. I think I heard him say that the tabled amendment in Mr Bayly’s name requiring the details of the resurgence payments to have been set out by tomorrow night would prevent the Government from making decisions—I think he then said—should they be needed. Now, that’s a quite interesting statement, because it suggests that at the moment, the Government isn’t convinced that they are needed. So my question to the Minister is a slightly hypothetical one, but it will segue into where else I want to go, and that is: does the Government foresee getting to 3 December having made decisions around the traffic light system—who goes to red, who goes to orange; nobody goes to green—and determining that as a consequence of that, no business will need support through this legislation?

That is a very important question. I know it’s hypothetical, but it is important to understand how much time we’ve got, because if that’s the Government’s start position—[Interruption] Huh?

💬 Hon Gerry Brownlee: Well, the Prime Minister’s said every business can be open.

Well, she has, and I listened to the Prime Minister, Mr Brownlee, but I also listen to business. I listen to business and I listen to my colleagues who have come from Auckland and they tell me these businesses are about to go to the wall and continue to need help, and it’s no surprise given the 100-and-something days that they have been under lockdown.

So we do need to hear from the Minister, but I also want him to confirm my understanding of Part 1 that clause 5—which is the meat and drink of Part 1—which replaces the existing 7AAB and 7AAC of the Tax Administration Act, which we put in in February for the first bill. The only change that’s, effectively, being made to this is to change the words “COVID-19 resurgence support payments scheme (the CRSP scheme)” by replacing those words with “a COVID-19 support payments scheme (the CSP scheme)”. So all we’re doing in this clause is changing from “CRSP” to “CSP”. We’re taking one letter out of the Act.

Now, I may be wrong, but I’ve had a pretty good look at it and I can’t see any other difference. So we’ve been debating for hours the removal of the letter “R”. I feel like an episode of Sesame Street. Now—

💬 Nicola Grigg: The Muppets.

The Muppets—yeah, The Muppets. Better than Sesame Street, Ms Grigg—I quite agree. So we’re removing an “R” and we’re debating hours of House time to remove an “R”. If that were all it was, well, we’d just lampoon them and go home, but, actually, the elephant in the room is what can business expect.

I go back to, when we did pass this in February, the same regulation-making framework was put in place—I accept that—in sections 7AAB and 7AAC. But what the Minister of Finance did in the debate was give the House, the public, the tax advisers, and those businesses—most importantly—a very clear framework for what they could expect and what we were doing. There was a plethora of references to what alert level it would be, how much they would get: $1,500 per applicant; $400 per firm, up to 50 fulltime-equivalents. They would have to have had a drop of revenue of 30 percent or more, it would have to have been calculated by comparing a seven-day period at alert level 2, and on and on and on. It might not have been in the black-letter law, but at least this House was able to debate what we knew the Government was intending to do, and at the moment, we’re flying blind.

We’re being asked to take an “R” out of the Act: resurgence.

💬 Simon O’Connor: Ridiculous.

“Ridiculous” is a much better word. I think there’s a steer for the title and commencement debate, Mr O’Connor.

💬 Hon Gerry Brownlee: Maybe it was for “required”—they don’t want it any more.

But we’re doing—“ridiculous” is probably a better word, I think. I’ll come up with a few other “R” words in a minute, but they probably aren’t going to be very parliamentary.

Minister, we need to know what we’re debating here. The idea that the regulatory impact statement doesn’t have a fiscal impact because taking an “R” out is costless belies the fact that this could be costing the Crown, or the taxpayer, hundreds of millions of dollars. We need better information.

It’s a shame the Minister of Revenue didn’t take a call to give a greater clarity on what the bill actually does, because on the reading of it you could simply say that what this does is it shifts the ability of the Government to give financial support to businesses under certain circumstances—[Takes off mask] Sorry, I’m so used to wearing the thing, Madam Chair. You get addicted to them and I think you start to enjoy the lack of oxygen, and I’m sure it’s causing idiot behaviour all over the country.

It would seem that the bill is supposed to extend the Government’s ability to offer financial support to businesses under certain circumstances. Well, at the moment, we know those circumstances are tied to the alert levels. But what we have here is a bill that may be activated by an Order in Council at some point, but it also goes beyond just businesses to anybody, apparently, who is financially disadvantaged due to the COVID health restrictions that might be in place at the time.

Overlaying that is the very strong assertion made no less than three times today in the House by the Prime Minister that says that under every traffic light colour, businesses will be able to operate. Of course, it’s easy to say that a business can open its doors. That doesn’t mean that under, say, a red system or the orange system, the normal custom that they might have expected would come through the door, but there’s no explanation here, no clarity in this bill, about where the parameters of that support might begin and end.

So a question I’ve got for the Minister is: what sort of advice was given to Cabinet when the bill was put to Cabinet for consideration? What sort of advice did the Minister get from, presumably, Treasury—some of the most clever people in the country, by their own proclamation—that made him decide this bill should go ahead?

There must have been some estimate of how many businesses were likely to need the support under the traffic light system, whether that be at the red level or the orange level. What is also not clear in here is: would the provisions of this bill, should it become an Act, still apply if the traffic light is at green, because there’s no prohibition here on any particular level inside that system?

We’ve heard repeatedly today just how much everyone should appreciate that traffic light system. Well, I can’t believe that there are no Labour members on the other side of the House who aren’t getting the same calls that we are from people asking the simple question: “How does this work? What are we supposed to do? How do we check people when they come through the door? What’s our legal authority to require people to show us their status? And if someone slips through and we suddenly got a drop in a hospitality venue from the several hundred that might be there down to the mere 100 or the 50, who do we choose to go out—how do we do all that sort of thing?”

So for anybody to say that there’s clarity in that traffic light system, there is a huge amount of delusion in their own assessment of that position. So it’s a simple question for the Minister, and I hope that he will take a call and answer it: what was the advice that made the Government say—even though the Prime Minister can stand up and say that under the traffic light system, every business can operate with no problem at all, what was it that the Government or the Cabinet considered? What were the numbers they considered that made them decide that we needed to have a bill in the House today under urgency so that it’s ready in time for the implementation of the traffic light system, so that there can be claims made for that assistance, and then, what are the levels of the assistance? Are they exactly the same as they are now? Is the criteria the same?

It’s very clear in here that they have to meet criteria, but there’s nothing in the bill to suggest that the criteria is any different to the bill that currently operates. But the current bill, of course, is only operational with the alert system. So perhaps also the Minister might be able to clarify what legislative advice they got that said that, actually, this is all that’s needed to transfer from one system to the other, and then we might be able to get an idea of whether or not this is just a have to sort of convince people that the Government cares, as opposed to a genuine COVID measure.

If I could respond to a number of the questions that have been raised, the Hon Michael Woodhouse asked me to confirm whether we thought it would ever be necessary to use this new framework—

💬 Hon Michael Woodhouse: No, no, it’s not “ever” but next week.

No, you asked me to confirm if we thought it would ever be necessary—

CHAIRPERSON (Hon Jacqui Dean): Not the Speaker, though.

—sorry; not the Speaker, but the member did—and, obviously, we wouldn’t be passing this legislation if we didn’t think it might be necessary to use it.

In respect of the Hon Gerry Brownlee’s question before he took his seat, the main change here is to enable a similar scheme to the Resurgence Support Payment scheme to be activated under the traffic light system, should it be needed. It cannot be activated for the traffic light system unless these amendments are passed, because the current legislative code ties it to changes in alert levels.

It was designed to be an instrument in respect of the resurgence of COVID associated with alert level changes. That now changes, as we have moved from elimination to minimising the virus through the traffic light system. As other members have already referred to, the Prime Minister confirmed on a number of occasions today that under the traffic light system, businesses can operate, albeit in circumstances that they can’t under the alert level system; albeit with vaccine certificate requirements on occasions. So these changes need to be accommodated in the compensatory payments that can sometimes be made by Order in Council, by changing the legislative framework to allow that in the future.

Thank you, Madam Chair. I don’t want to get in the way of my learned colleagues, but I appreciate being able to take a call to clarify the question that I asked, and I apologise if it wasn’t clear to the Minister. It was not whether the Government envisaged never making resurgence payments, or whatever the current nomenclature is—I think that’s an “R” word, so it probably isn’t in the new bill—but whether it envisages a scenario where we get to 3 December, the start line for the traffic light system, and there is a scenario where support payments would not be required on that day, because that was the argument that Mr Bayly was putting up for having clarity for business by the end of play tomorrow, and the Minister’s answer implied, or at least I took the implication that that meant that the Government was contemplating no support payments at that time.

I absolutely understand that the circumstances with the virus and with the need to further constrain businesses in the future, even under the traffic light system, may warrant the creation of a support payment framework after that when circumstances change. But the way the Minister was describing it suggested a lack of urgency, because, actually, the Government wasn’t contemplating business not needing that from next Friday, and I think that if that’s the case, well, at least let’s be honest with business about that, because what I have been asking for is actually some clarity about what we can see in the way we got it in February. If that clarity involves “OK, business, you’re opening up. You’re not going to get support from the taxpayer. That’s where we going to have the start line. If things change, we’ll change.”—if that’s the message we’re sending to business, that’s fine.

But I apologise if I wasn’t clear in my initial question. It wasn’t that there wouldn’t be support for all time; it would be the envisaging of no support on 3 December.

Thank you, Madam Chair. I rise to ask a couple of questions of the Minister on behalf on behalf of South Island business operators, but I’m sure the MP for Waitaki will understand why I’m doing this.

Minister, I spoke earlier this morning in the first part of this bill about the deep, deep ramifications that this protracted period of alert level 2 has had on South Island businesses. If you wouldn’t mind, I want to run you through a couple of scenarios that I’ve got in my own electorate. One is a health-based business that deals primarily in elderly clientele. She has not been able to have her clientele through her doors, but by definition of an alert level 2, she has to remain open. This woman has been paying her staff and her rent out of her life-savings for the past 12 months.

Another example I have is what was once formerly an inbound tour operator who dealt with high-end clients from India, had a range of Mercedes-Benz vans, bought in high-end clients, took them on luxury tours around the South Island—a really good little business. Overnight, when our borders were closed, that business ceased to exist, effectively. This person paid for all of his drivers to go and get their Uber licensing to try and keep their heads above water. He has on periodic occasions sold off his vans, one by one by one—I think he’s now down to one van left—just to pay his own rent and live his life. He hasn’t been able to apply for any form of Resurgence Support Payment under this alert level 2.

So what we in the South Island want to know is: where does this bill provide for what was once alert level 2, what is that going to become, and what is the payment support framework that will be attributed to these new red, amber, green - type alert levels?

Let’s, for argument’s sake, say that what was once the alert level 2 framework now becomes the amber light framework but that those businesses did not meet the criteria or standards to get any form of Government support. If we are to remain in a protracted period of the amber colour, for sake of argument, how are these businesses supposed to survive? Is there any discretion within this bill for these people to be able to get some kind of Government support?

Minister, when these people come back to me next time, and when this tour operator says, “I’ve sold my last van. I’ve got nothing left.”, what do I say to them?

I think we’re all sympathetic for the plight of people who are adversely affected by the virus. Some of those people have suffered terrible consequences for their businesses, and that’s caused by the virus; not by what the Government has done.

Thank you, Madam Chair. Look, I just want to acknowledge Nicola Grigg for her contribution. I too have a similar case in my electorate, but it actually relates to a bus company. The owners, a husband and wife team, are in a similar situation where they are about to lose a lot of their life’s earnings. They have a big fleet of buses and for them to get through the process, they have been looking at disposing of buses, and, of course, every time they do that, it means that one less person has a job, or perhaps, if they have a couple of drivers, a couple of people. So this is the immediacy of what we’re talking about tonight.

This is actual, real stuff that is happening on the ground. That just highlights the importance of the Government being clear about its intentions, and that’s why, with eight days to go, I still think it’s outrageous that the Government’s not prepared to say what the new arrangements are under the new traffic light situation.

So I want to turn to my tabled amendment, because the Minister sort of slightly sideswiped me and said, “Well, we’re not going to make an announcement by 25 November.”—tomorrow night. I suppose this gives rise to: is this a question of could, should, or would? I think, if we ask ourselves, “Could the Government make an announcement tomorrow?”, well, of course they could. The Government came out with an announcement on 22 October, with great fanfare, saying, “We’re going to do something.”—right?—as they always do, and, of course, everyone in New Zealand heard about this announcement of the announcement of the announcement that they were going to make this change. Over a month later, it still hasn’t made the announcement.

Now, I think it would be appalling if it is really the situation, with eight days to go—and we’re getting close to midnight; it will be seven days tomorrow—that the Government really hasn’t worked out what the new arrangements will be. So could they make that announcement by tomorrow night? Of course they could.

The second issue is: should they make an announcement by tomorrow night? I’ve got to say, we’ve just heard Nicola Grigg talking about a story, I’ve just related one from my area, and I would imagine that if the backbench members of the Labour Party were to stand up and contribute to this debate, which is highly unlikely, but if they were, and be honest about their situation and the calls they’re getting and the emails they must be getting—unless they’ve chosen deliberately and callously not to respond to people, not to listen to people’s plights, and not to act like real electorate MPs, they would have to be tone-deaf if they were not getting the same situation. I see all of them looking down—all of them looking down. The reality is that everyone’s been affected across all of New Zealand, and so should they make an announcement by tomorrow night? Of course they should make an announcement—the Government, I should say. The Government should make an announcement by tomorrow night.

So the question then turns on would they make an announcement tomorrow night, and that’s the big issue. We have a Government here who just loves making announcements, keeping people on the hook, and then letting out a little bit more information. I would suggest to you, Minister, that you could make the announcement—you should make the announcement—the question is why you wouldn’t make the announcement tomorrow night.

The other thing I’m a little bit worried about is that I heard the Minister say before that—and he implied “should financial support be needed”. Now, I’m just hoping that that was just a slight slip of the tongue, because my first question is: can the Minister confirm that the Government will be putting in place a new financial support package for businesses, business owners, and their staff, and that the reference to the possibility of it was incorrect? The second question is: could he confirm that they could and should make an announcement but that they’ve chosen not to make an announcement? That’s a big issue, and that is the issue that most New Zealanders and their business owners and their staff are most concerned about right now.

What I can confirm is that the scheme that has been in place until now, which has been linked to alert levels, has been utilised on a number of occasions over the last year. The next scheme needs to be durable for the new traffic light system for a long period of time, and I can confirm that if the committee was to vote for Andrew Bayly’s amendment, it wouldn’t work.

Thank you, Madam Chair. I have some questions for the Minister about the premise of the bill. I just want to return to the regulatory impact statement initially, just to refresh the understanding of the committee as to what this bill proposes to do. In the regulatory impact analysis, when it talks about the COVID-19 support framework, the Treasury considered that an impact statement was not required, on the grounds that this legislation is likely to have no or only minor impacts on businesses, individuals, and not-for-profit entities.

💬 Hon Gerry Brownlee: No, they’re not going to pay it.

Mr Brownlee is correct. It appears that while this legislation is being rushed through under urgency with much fanfare and described as being absolutely vital to align the new traffic light system to the old COVID alert framework—or in Auckland, we’re not quite sure. It’s “COVID-19 alert level 2 or 3.haircut”. Last week it was “level 3.Mitre10”. As far as Aucklanders are concerned, it’s “level 3.Let’s get out of here”.

💬 Chris Bishop: What about “3.picnic”?

Well, “3.picnic” was some months ago, Mr Bishop, and you can guarantee that Aucklanders, who are freedom-loving people, took that very, very seriously, to get out there, have picnics, go and talk to friends and family, and support them.

Now, when we’re thinking about whether this is actually going to work, what’s the point of it, and then we come to the next stage of the regulatory impact assessment, at paragraph 2.5: “For the policy to be given effect by this Bill, is there analysis”? Well, on the COVID-19 support payments framework, no further analysis is available.

So what the ACT Party always asks is: what are the costs and what are the benefits? The second question we ask is: who pays the costs and who receives the benefits, and that is simply not clear from this legislation. It’s a sketch, it’s a charcoal imprint, and it’s not clear whether this legislation will actually benefit anyone. But by forcing it through under urgency, this House costs over $20,000 an hour to run, and so all of those hours spent this morning under urgency were to pass legislation which it appears may not ever be used or not used in the way that it’s intended.

Then I want to come to the matter of what do businesses actually need. Well, what they need is clarity. What they’ve been given is a traffic light system.

Now, I’ve run a few roadworks in my time as a civil engineer. I know how badly a stop-go can go when it goes wrong, particularly in summer on a dusty road when all the workers decide that they’re going to take smoko at the same time and they just put the sign to “Stop” and they all wander off and sit under a tree—and that’s not just in Fiji; that’s here in New Zealand as well. So my impression of this legislation is that it’s going to be more like a stop-go somewhere out in the regions with not a lot of supervision from the Government.

As the Prime Minister has said, “Look, you all have to do the contact tracing and you’ll all have to have the vaccine passport on your phone, but, gosh, don’t worry about checking it. As long as someone thinks they’ve seen it when you walk into the bar, well, that’ll be enough.” Look, you know, I’ve had a number of boys go through high school in the past few years, and if they thought they could pass exams by waving a piece of paper like this in front of the teacher, I tell you what, they’d be through with scholarships by now. They’d all be on their way to med school, or probably off to the Manukau Institute of Technology to learn how to build rockets.

So what businesses need is certainty. This piece of legislation gives absolutely no certainty to businesses, because it actually doesn’t qualify who will get to be a business, what is a business circumstance or matter, or who is the group who might be affected by such matters, and then what they do about claiming any benefits.

Now, what I’d like to do is offer a bit of an example. I have a very dear friend who mortgaged his home, bought some trucks, hired some people, including people who you might say at first glance weren’t going to be the people that you’d want to trust with your brand new truck and all of your brand new power tools. But he took a chance on those people, and he has a landscaping business. That business has contracts in the south of Auckland, delivering landscaping for very large housing developments. Now, my dear friend has a business, and some of his staff live outside of the Auckland level 3 alert level zone. One of the ones who has the truck with some of the tools on it lives in the Waikato, and despite the fact that alert levels have bumped around and hopped around and tripped from here to there, the staff who sometimes were in level 2 in the Waikato and sometimes were in level 3 haven’t been able to return to their place of work in South Auckland with the truck and the tools for months and months now.

CHAIRPERSON (Hon Jacqui Dean): Order! I’m just going to invite the member to come to Part 1 in this committee stage.

Thank you, Madam Chair. So I’d like to return to who is financially affected—

💬 Hon Gerry Brownlee: Point of order, Madam Chairperson. Earlier this afternoon the Speaker made it very clear to the House that there would be a great deal of leniency taken on these two COVID bills, and recognised that because of the shortened process and the importance of these bills, there would be a straying away from some of them and that sometimes speeches might have been slightly extraneous. I think—

CHAIRPERSON (Hon Jacqui Dean): Thank you for that.

💬 Hon Gerry Brownlee: —the committee would be very interested to know Mr Court’s story.

CHAIRPERSON (Hon Jacqui Dean): Thank you—thank you for that. The Chair is, as the member knows, the sole judge of relevance. I am indeed very mindful of the short notice and time frames and urgent nature of this bill. I am cognisant of it and I’m keeping it in mind.

Thank you, Madam Chair. Look, for the benefit of the committee, I’m always prepared to accept the friendly but forceful advice of the Chair, in this particular case to come back to the bill.

Look, businesses like my friend’s landscaping business are financially affected by public health orders. His staff are awaiting the opportunity to return to work. His contract is unfulfilled. His client is saying, “If you can’t deliver the landscaping so I can hand the site back to the developer, then you’re going to have your contract nullified. You will then be liable to me to pay my costs, even though your workers are excluded from coming to work by a Government health order.”

Unfortunately, despite writing many letters to the Ministry of Business, Innovation and Employment seeking permission and then trying to seek cost recovery through the Government’s current support schemes, he remains unfulfilled in his ambition to have the costs imposed by Government—the cost of managing the public health response which this Government has outsourced on to New Zealand businesses, and outsourced in the most deeply cynical way, whether it’s by imposing contract clauses into commercial tenancy agreements, or whether it’s by telling businesses that they must check the vaccine passport, but, “We won’t check you, but if the hair salon wonders if somebody’s turned up without the right documentation, they should call the police.” This combination of friendly advice and the billy club held behind the back is an example of this Government’s cynical behaviour, just like this piece of legislation is.

So what I would ask the Minister is, instead of all of this pantomime around pretending to care about business, why don’t you just do what business is asking you to do? Open New Zealand up—open up on 1 December. Let businesses manage their own risk, just like construction businesses and transport businesses, who have drivers and operators and customers and who are at risk of trucks crashing or forklifts tipping over. I mean, COVID19 to them is simply another health and safety risk that they need to manage.

What they’re asking for is “Let us out of here. Set us free. Stop wasting our time with your good intentions but obvious hopeless delivery, and let us get back to business. Let us open our doors without all of this.”, because none of this would be necessary if businesses were actually able to open, to welcome their customers, and to manage their own health and safety risk. They wouldn’t need the Government to be standing over them, saying, “Oh, we’ll save you when you need saving.”, because it turns out—particularly in the Auckland CBD and the Auckland region—the time for saving businesses is long, long gone. The “For lease” signs are up, the shops are emptying out, there are tumbleweeds blowing down some streets in the wind, and no amount of pretend caring from this Government is going to change that. I’d like the Minister to answer all of those questions, please.

The idea that if we had given in to the prescription that we heard again from the ACT Party and have heard repeatedly over the last year and a half that we should just open up—the idea that that would have had a better outcome for New Zealand is nonsense. The economic outcome would have been poorer as well as the health outcome, and many more people would have died.

Thank you very much, Madam Chair. I’m going to be speaking to a tabled amendment of mine, Minister, on what is a very particular circumstance coming out of the Tāmaki electorate. In effect, it’s based on the premise of a particular consideration that I’d like you, Minister, to give to a particular line of businesses—particularly new business owners—being able to access the COVID support payments, with the premise being that this bill is widening the scope, effectively, or giving you, Minister, great powers to discern who can and who cannot access this scheme. So I’m trying to highlight tonight, on behalf of my excellent business owners of Tāmaki and, I’m sure, others around the country, a failure in the current system.

So the long and the short is you can get a COVID recovery payment at the moment if you’re an existing business owner and you can demonstrate that your business is not doing well. Unfortunately, if you are a new business owner—so you have gone and bought that business; you’re a new owner—strangely enough, you don’t have a history and, therefore, you are ineligible to obtain the COVID payment. So this tabled amendment is going to make a suggestion in clause 5, and I’m not going to get into the technical wording, but it’s, basically, wanting to instruct the Minister to bring those new business owners to mind.

I’m allowed to share an example. It’s called the Mission Bay Cafe. Fortunately, the tumbleweeds are not running by. It is the most popular cafe in Mission Bay, if not Tāmaki. After 23 years, the former owners have just sold, Minister, and Hassan and Eco have bought it, and, unfortunately, as new owners, they don’t have a service history. Therefore, they’re ineligible. I think that’s wrong in itself but, importantly too, business is hard enough at the best of times, and these two have taken a punt and are just wanting some help and fairness, to be honest.

So this is why I’ve put this very particular tabled amendment out. Fundamentally, it’s saying we need to be able to tie these payments as much to the business as to the owner, because, using the Mission Bay Cafe as an example—but it’s not the only one—the business has not changed. As I say, for 23 years it has served the good people of Tāmaki, including myself. It hasn’t changed since the ownership moved. It would be different, of course, Minister, if the business went from being a cafe to—I don’t know—selling furniture, and I suspect you, or officials, may want to consider that how one vets that. I can imagine how it could be gamed. But this is a very particular situation. New owners Eco and Hassan have taken a chance. They’ve bought a new business. They want it to do well. They’re going to do the absolute best that they can, but they can’t access this payment.

I want to acknowledge I have written to you, Minister. It’s only been in recent weeks, so that’s not a statement in reply, but I have written to you. I have also, today, decided on behalf of these business owners in my electorate and on behalf of all my businesses to ask that you consider this tabled amendment. It’s going to make a change to clause 5. Fundamentally, it’s allowing new business owners of existing businesses to claim for future support payments. So thank you, Minister, for your consideration.

Thank you, Madam Chair. I am aware of the issue that the member raises, but not the individual case that he refers to, because there are a number of people in New Zealand who are in a similar situation. The terms of eligibility and comparative periods for revenue loss are set out in the orders rather than in the Act, so we won’t be supporting the amendment because it would sit better in an order than in the Act. That said, we’ve already moved to reduce the period of trading that is necessary under the existing Resurgence Support Payment from a six-month trading history to a one-month trading history, but the member is quite correct that that still excludes the purchaser of a business who doesn’t qualify on that basis. For that to be fixed, in our view, if it were to be fixed, it would be better fixed through an order made under the empowering legislation rather than through the empowering legislation.

I would also note that when the Auditor-General looked at some of the support payments that were activated soon after the start of COVID, the Auditor-General made the point that we do need to be careful to have some integrity measures to stop the system being gamed by people, effectively, pretending that they’ve got a new business, or not pretending that they’ve got a new business but pretending that they’ve suffered a loss that they haven’t. That means that there is some line that has to be drawn, and on some occasions people are on the wrong side of that line, even though we feel very sorry for them. But we’re not proposing to fix that in the primary legislation, and if that was to be fixed in the future for future support payments, it would be done through the terms of orders, rather than through the primary legislation.

That was an interesting contribution from the Minister. With regards to the Auditor-General’s concerns, I would have thought that GST records would have pretty quickly shown whether or not a business was making it up or not, and other Government compliances, similarly, along with the requirements for accountants to be appropriate in their dealings with tax agencies, etc. So I think that in response to Mr Simon O’Connor’s request, that last part is not so good. I hope the form of it, talking about an order to perhaps help some of these people, would be a good thing.

But I want to just take the committee back for a minute to the response that the Minister gave to Nicola Grigg’s question about people in the South Island who have had to put up with the level 2 restrictions but who, as a consequence of level 2, have not been able to access some of the supports that might be there had it been level 3 or level 4. The response that came from the Minister was “Well, look, of course we care about these people. Naturally, we care about them. But, look, we’re moving forward and we’re coming down in line with this traffic light system.”, but that doesn’t for a minute explain where the support that this bill would allow would kick in under a traffic light system. No one’s got any idea whatsoever. Is the Minister telling us that the same conditions for the four levels under the alert system would be the same for the three levels under their traffic light system, and can he tell us where the differentiating line would be?

Earlier, I asked if the Government had received any advice from Treasury or any other agency of Government—perhaps the Ministry of Business, Innovation and Employment—about the expectation for the call on this sort of support once the traffic light system was put in place, and there’s just silence on that. There must be something somewhere. Mr Court asked a similar sort of question, but no answer was forthcoming. So did the Government just decide to put this bill through to line it all up a little bit without knowing exactly what was being lined up? If there are New Zealanders out there tonight concerned about what’s going to happen when the new announcement is made about the traffic light system and they’re living in Auckland and they’ve already been told it’s going to be red, what’s it going to mean for the assistance that they might now be getting, given that the Prime Minister has come in and said, “No, the big difference will be that even though they’ll be at red under the traffic light system, they’ll still be able to operate.”? So does that mean that if they’re down by the 30 percent even though they’re operating under the traffic light system, or the application applied here according to the traffic light system, they can make an application for a continued grant?

It’s not unreasonable that those questions are answered when there is no select committee process that might tease out all of that sort of information. There would be an expectation that in a select committee, there’d be a departmental report. So a departmental report will generally cover off all the questions that are raised at a committee by submitters or by committee members, and things like this lack of clarity that’s here tonight would be sorted out. But the Government has said, “No, it’s not important enough to send it to a select committee. We don’t need to hear from the general public, don’t need to hear from any of the various ranges of experts out there in tax matters, etc. We’re just going to put it through because it just lines up one system with another.”, but there is no clear alignment.

So, Minister, is it possible to tell the committee what advice the Government got about expectation for calls upon assistance once we go into this traffic light system, given that there are so many businesses out there who want to open and who want to succeed, so many business operators and owners who have put their own capital in to their business over the last 12 to 18 months to keep it afloat, and so many businesses that don’t like having to call on the Government support but know that without it, they shut the door and the people they employ go down the road. So I wonder can the Minister please answer that question, because for so many people hoping that this bill tonight is some sort of indication of ongoing support, it will be necessary to know how it kicks in and where it links in with existing systems.

What I can confirm is what I’ve previously said, and that is that there are many imponderables that have arisen from COVID. The consequences for business have in part been alleviated through the Resurgence Support Payment, and if this amendment does not pass there is no way that a Government in the future can do similar things under the traffic light system, because the current system relies upon alert level changes under the alert level system, which is replaced with the COVID protection framework.

Thank you, Madam Chair. I just want to read out a text message to Minister Parker, which I received earlier this week from one of the Auckland hospitality businesses that Christopher Bishop, Christopher Luxon, and I visited last week. I think it sums up the feeling of Auckland businesses quite well. He says, “Hey Erica, can you give me a buzz? Hearing that Auckland might be in red till mid-January, which would be catastrophic.” Now, the reason that he’s texted me is because he has absolutely no certainty over what the support payments will be under this system, whether he will get anything at all, how long it will be for, or what are the criteria.

I’ve got a number of questions for the Minister, but I want to just give some context around this, because Auckland businesses who have not been able to operate under level three, the hospo businesses and the personal service businesses that have been doing it the toughest—the first to go into lockdown, the last to come out; the ones who have lost the most—have a lot riding on this, and there is nothing in this bill to give them any confidence, hence, why they’re sending me these messages. All they want to know is what will the criteria be, what will the payments be, and how will they be able to survive.

Now, I want to specifically ask the Minister, because this came through really strongly in those hospo businesses and personal service businesses that we visited. They said to us, “It’s great that we’re going to be able to operate for December. Four weeks—that’s all we’re going to get, because once Auckland borders open, Aucklanders will leave, and for January and February there will be no business. We will be dead. There will be no Aucklanders here to visit the hairdresser, the beautician, the restaurant, the bar—nothing.”

So what I want to ask the Minister specifically for is: is there any criteria? Will there be any criteria for these businesses to get support payments to pull them through January and February, when there is absolutely no business in Auckland, because I get the feeling that the Government just believes that if they start with the traffic light system in December, then everything is going to be fine in Auckland under red lights. Well, clearly, from this text, it’s not going to be fine. Even if Aucklanders stayed in Auckland, red still means for hospo limited numbers of people because of the social distancing and the limited numbers allowed in the business, let alone the fact that there will be no Aucklanders there to support them through January and February. But under this system and under this bill, there’s absolutely no guarantee that they will have any support, and that’s why they’re really upset.

I visited a beautician in my electorate, who started her business when she was 19. For the last nine years, she has been living in a flat beneath her parent’s house to save for a deposit on a house. She has lost all of that through paying her staff and paying her rent and paying her bills and paying the council—all of those ongoing costs—through level 3. She now is staring down the barrel of being able to open, and do a few facials and massages and the things that she does, for December, and then nothing. She will have no business in January and she will have no business in February, because, as Aucklanders well know, no one is going to be around. The question, again, for her is: in this framework, will there be any support for her?

What will the criteria be for those businesses who are staring down the barrel of nothing for those few months? They’re worried about their provisional tax that they have to pay early next year, and they’re really concerned because they’ve got no certainty over what the level of support will be, when it will kick in, or what criteria they will have to meet, and they are really worried that this Government has no idea about the situation that Auckland businesses, especially those hospo businesses and personal services businesses, will be in when Auckland empties out.

I would like the Minister to answer the question: is there any support? Is he thinking about that scenario, and will there be any support, or any criteria for those businesses to get support, through the traffic light system, because they are terrified. They’ve already lost everything, and they’re staring down the barrel of losing more, which is why they’re texting us in a panic, because they’ve got no certainty. That’s all they’re asking for, and there is nothing in this bill.

Thank you, Madam Chair, for the opportunity to speak on this bill, which we don’t support, and this item in Part 1 relating to the complex—well, not complex; the lack of any detail around how any support payments would exist. My colleague Gerry Brownlee was asking questions of the Minister around “Does the Government actually plan to make anything or are they just going to wing it?”, and I can give him an answer because I’ve heard the Minister of Finance many times in this House say, “No, we actually think, when we move to the traffic light system, that there won’t be the need for ongoing, wide-ranging support.” That’s their view—they’re just going to can it. They think that everything’s back.

Now, our political point on this side of the House is that the best way that you can help businesses: small businesses, employers, people who are trying to stay afloat in their businesses, such as we’ve heard in the cafes and the beauticians, the tourist operators—the best way you can help those people is to allow them to do some business. That’s how you help people in business. You let them do their job and actually serve some customers and give people what they want, and be able to sell them the coffee and the ice cream and so forth—let them actually live and get their lives back.

That’s how you help people, and this Government just continues to find every reason to keep us, in some way or other, locked down, notwithstanding the fact that the promise was made to the people of New Zealand that if we went out and we got vaccinated and we got up to 85 percent—we’re nearly at 90 percent. We’ve reached one of the highest vaccination levels in the world. Well, they said that we needed to, because the Government spent the first six months of the year saying we didn’t need the vaccines and other countries needed them more than us, but we’ve finally got there.

New Zealanders have gone out, they’ve got vaccinated, they’re at high levels of vaccination, and yet, still, what is the benefit for Aucklanders? We go to red. Nobody in Auckland can understand the most weird reward for effort ever in the history of this country, which is that we all do our bit, we get vaccinated, and the reward is that we go red—we go red—and we still have to live on with all these controls and difficulties. That makes business difficult, and then the Government says, “Oh, don’t worry—don’t worry. Businesses can all trade under all the traffic lights.”, yet they miss the most important word, which is they can trade but can they trade profitably or can they trade sustainably? There’s no point being able to open your business if there’s no possible way, given the rules and the numbers of people that can come and the requirements, that you can actually make a living. That is the issue.

So we’re forced into this ridiculous situation. The Minister of Finance stands up and crows about the fact that he’s spent $6 billion over the last four months helping support businesses because of the lockdown that has been imposed, and thank goodness that some resources have gone to those businesses who were in desperate need of them, but it’s nothing to be proud of. It’s $6 billion that could have built six hospitals. It could have done amazing things for this country, that kind of money—that sort of investment. Well, it could have probably covered the cost of a third of that Minister over there’s crazy light-rail transport. Now, that wouldn’t be good money, because it is the most ridiculous project ever put forward. But, nevertheless, that’s the scale of the money that would have the biggest transport proposal in the history of Auckland: a slow tram down Dominion Road, which nobody thinks makes any sense whatsoever. I’m getting distracted, but that is the scale of the money that’s being spent.

Now, the answer is not just to keep on pouring it on and keeping us locked down for ever—waiting until April to allow tourists to get back into this country, effectively, which is what we’ve heard today. For goodness’ sake, are they saying that the tourist industry is not going to be affected now that we move to the red traffic light? No—they’ve got no tourists. You can’t trade if you’ve got no tourists, and there’s nobody here because they have to go into isolation for seven days. Nobody is going to do that. The rest of the world has moved on. Australians are not going to say, “Oh well, I know—here’s an idea. I could go to New York for a week, or I could go to Queenstown for a week and I’ll spend my week in self-isolation at home. Oh yeah, why don’t we do that? We’ll go to Queenstown.” I mean, it’s so nonsensical it’s not even funny, but that’s what’s being proposed, given the fact that we’ve all got high vaccination rates.

So the Government, in this piece of legislation—why we oppose it is because it’s imposing a framework that makes no sense. Our view is that at high vaccination rates, we need to allow people to get their lives back and trade. Then, when we look at this bill, it sets up—having ignored that and having decided to keep us locked down and decided to keep all those businesses to carry on struggling in various ill-defined ways, it then brings in legislation implying that it may provide—[Time expired]

Thank you, Mr Chair. Thank you. I am really grateful that my name was called, because I’ve been trying to take a call all evening. Maybe it’s because I was a little short behind all these tall men in front of me, but thank you. I appreciate the call.

I wanted to raise the issue in terms of the COVID-19 support payment (CSP) scheme. I know that my colleague the Hon Michael Woodhouse earlier made a little bit of a joke in terms of how it used to be called “CRSP”, and now, in this bill, they’ve just removed the one letter, the “R”, so it’s now called “CSP”.

But, seriously, I wanted to take issue with Mr Andrew Bayly, who said that members who are electorate MPs should be getting all these complaints from constituents. Let me tell you, Mr Bayly, that as a list MP, I too am getting a lot of complaints from people in Mt Albert. Their electorate MP is otherwise engaged, and around the country, there are plenty of people who are complaining about the Government’s failure to support them.

If I could ask a question to the Minister—I will get to the point. In terms of the Resurgence Support Payment (RSP), one of the problems that a lot of people had—and I know that earlier, Simon O’Connor talked about when new businesses take over existing businesses, they don’t actually have the time period of operation, so it’s very difficult for them to actually get the RSP payment. I know that when I contacted the electorate officials’ line—because MPs could do that—there were some circumstances where they thought they could actually provide the RSP support, and that was only for existing businesses that provided the same kind of food, for example, the same kind of business, same kind of training methods, same time, or whatever. Some of them actually did qualify, so I’m very grateful for that.

Having said that, one problem was that the IRD, in that on 17 August, when we went into lockdown, we went into lockdown at 11.59 p.m., so 17 August was not an affected period because the business hours were over and done with. So the affected period should have really started on 18 August, but 17 August was considered an affected period, so the day’s takings were considered as income for the affected period.

💬 Hon Member: For one minute?

No, no—yes, one minute, but the whole day’s trading is considered as trading. So when you’re comparing affected period with comparative period—the one day’s takings when businesses were actually struggling, and that one day when they’ve done an amazing amount of trading—the percentages mean that some people could not get the RSP payment. It is absolutely unfair that when we did not even go into lockdown until 17 August at 11.59 p.m., IRD’s computer-generated online application process would not let people include 17 August. So if the Minister could actually confirm that those kinds of issues will not, in fact, happen with this CSP when the RSP was actually very, very difficult for a lot of businesses who were heavily impacted.

The other issue that we have is that—I mentioned this particular issue when we went into lockdown on 17 August. The warning the Government gave in terms of “We’re going to go into a lockdown in a couple of days.”—that happened last year. When we went into lockdown the first time, the Prime Minister got in front of New Zealanders and said “From such and such a date and from what time we’re going to go into a lockdown. We expect New Zealanders to come back home, and this is what’s going to happen.”—preparing the businesses and the entire New Zealand population for what was supposed to happen.

This time around, on 17 August, the lockdown happened pretty quickly. We were in the afternoon when the announcement was actually made, when businesses were closed, and there were a lot of businesses who had a lot of stock. I quoted one florist who had $70,000 of stock that she was supposed to courier the next morning. But she could not do that because all of the couriers were closed when the announcement was made and she lost $70,000 worth of stock, and because it’s a pandemic, no insurance will cover that.

So I would like to know in those circumstances what kind of support payments would the Government provide or actually help these people, because these are not rich people. These are business owners who save for a lifetime to run a business, who actually work really, really hard to supply their customers with stock that, often, they can’t afford to lose, and they have, in these circumstances, because the Government went into lockdown very, very quickly. So if I could get the Minister to answer that, I would appreciate it.

Thank you very much, Mr Chair, for the opportunity to make another contribution on this taxation bill. My question is really a series of questions, and it’s to do with the way that the bill is set out and who’s going to get to make these decisions. My colleague and friend Erica Stanford has asked a similar line of questions in relation to particular businesses who just want to know what the circumstances will be, and other colleagues have asked along similar lines. I sort of take a constitutional angle to that because it just seems to me unbelievable that we have so little detail in a piece of legislation for actually how this support is to be provided.

So we’ve heard that Orders in Council—regulations, essentially—are going to be able to be made for the way that the support is to be provided. There’s almost exactly zero detail in here. So, for example, the—

💬 Chris Bishop: Are you surprised?

Well, I’m not surprised, Mr Bishop. I’m sort of unsurprised but shocked at the same time. So “the Governor-General”—OK, read “the Government”—“may by Order in Council—… declare the activation [blah, blah, blah] specify the period … describe a class or classes of persons … specify amendments”—all these things, these are the basic details. There’s literally nothing there. It’s like a blank cheque. But the trouble with a blank cheque is it could end up with a huge dollar figure, but it could also end up with zero. We don’t know the most basic details.

“Declare the activation of a COVID-19 support payments scheme”—that’s the what. “Specify the period for which, or the circumstances in which, the CSP scheme is to operate”—that’s the when. “Describe a class or classes of persons who may apply for a grant”—that’s the who. “Specify amendments to the CSP scheme,”—that’s the how. We don’t have the what, the when, the how, or the where—we do have the where. Actually, we don’t have the where either, because goodness knows where it’s going to apply because that probably depends on the colour of your traffic light in the area that you’re in, and goodness knows how that relates to what’s currently available, and, goodness knows, even that system’s not perfect.

So it just seems to be absolutely extraordinary that we’ve got so little detail, and as a member of the Regulations Review Committee, obviously, I can’t prejudge the discussion that that fine body is going to come to when it examines these things, but I can only imagine that we’re going to have a heck of a time trying to understand the way in which a regulation-making power has been drafted in such unbelievably scant fashion. I mean, there is literally nothing in there that’s in or out, no kind of clue as to the criteria—

💬 Hon Member: Shake it all about.

That’s right—we don’t know what’s in and we don’t know what’s out. It’s like legislative “Hokey Pokey”, and as to whether even more basic details—

💬 Chris Bishop: Oh, shake it all about.

Shake it all about—well, that’s right. Well, that’s what we’re trying to do. We are trying to shake it all about, so to speak. I’d better not go too far down that line.

💬 Simon Court: You’ll end up on Dancing with the Stars if you’re not careful, Mr Penk.

There’s a Dancing with the Stars - related comment made from a member of the ACT Party, and I know that could lead us to a dark place. But if you’re watching, producers of Dancing with the Stars, look elsewhere—I’m sure you already are.

But even more basic details—I mean, is there an appeal right for people who have applied under this scheme and been knocked back? I mean, that would be an extraordinary thing not to be able to have, as the Minister of Revenue will know, because he’s a legal man as well as wearing a revenue hat tonight. He will know that one of the Standing Orders grounds on which we can decide whether regulations are reasonable, essentially, is whether there’s a right to review other than by the decision-making authority themselves. So if “The Commissioner, on behalf of the Crown, may make a grant”, but, obviously, may not make a grant because they might exercise their discretion against the criteria that we don’t yet have, and then get knocked back—as various constituents of mine have found, and Mr Simon O’Connor has identified a similar kind of situation in relation to constituents of his—where’s the natural justice? Where’s the due process? I mean, it’s just absolutely unbelievable.

Then you’ve got the drafting of this thing, which just seems to me extraordinary. “If a person applies for a grant on behalf of another person, both the person and the person in whose name the application is made must provide information as required by the Commissioner.”—well, that’s just complete duplication. Do they both have to supply the same thing? What does the phrase “on behalf of” mean if not that they can do it in the place of, rather than as well as? I mean, can we not have a tax agent? This is just absolutely extraordinary.

We hear as well that “The person in whose name an application is to be made is [to be] bound by the terms of the … grant.”, and then it says that if the terms include repayment, they must repay it. Well, that’s absolute duplication. It’s tautology and an absolute nonsense.

Honestly, I can’t get my head around it. I’m just absolutely bamboozled and gobsmacked and other things like that. It’s just that I really and truly can’t believe it, and I should know by now, after four years in this place, not to expect much better than this. But, genuinely, I cannot understand that we have such a flimsy law on the statute book, or it’s about to be on the statute book, and it’s just thoroughly disheartening. But it doesn’t really matter from a constitutional point of view. More to the point is that constituents—good, working people throughout the country—don’t know what the hell’s going on, and that’s a real problem.

I think the irony for listeners hearing this debate tonight would be that when they reflect that the earlier version of the Resurgence Support Payment that this replaces, it’s in virtually identical form, except it links through to the COVID protection framework rather than the alert level system the National Party voted for.

Oh, I think we’ll have a kaumātua view—Ian McKelvie.

Thank you, Mr Chair. Now, I just wanted to go back in time a little bit to 4.15 this afternoon. As I do most nights when I’m in Parliament, as I was eating my couple of lamb chops tonight, I scrolled through the media clippings to see if I could find my name. Needless to say, I didn’t. But as I was scrolling through them, I could not believe that I’d found—

💬 Hon Gerry Brownlee: Well, at least it wasn’t in the obituaries.

I’ve only got one battery left, Gerry. The other one’s gone—I lost it in the garden. As I was scrolling through, I found two articles which I was absolutely intrigued with. It only happened—at 4.15 this afternoon we passed the last of these bills, and, blow me down, there were two articles in the paper already tonight, criticising the previous bill for the mistakes it had made. But that’s not what I want to ask the Minister about, because I want to get very close to the topic Mr Penk was talking about a moment or two ago.

One of the things that worries me about any kind of emergency, and I don’t think it matters whether it’s COVID or whether it was earthquakes or whatever it was, we always put a whole lot of pressure on I’d suppose you’d nicely put it as our bureaucracy, or the Inland Revenue, or whoever we do. We put significant pressure on them, and when you read this bill, it’s quite interesting. I know there’s been a lot of discussion around wage subsidies and the other relief payments that were made in the first series of lockdowns, and, clearly, there’s going to be a lot of pressure as a result of the last 92 or 93 days of lockdown in Auckland and the damage that’s been done to businesses, particularly in the tourism sector in the central North Island and, clearly, parts of the South Island as a result of Auckland not being able to get out, because, frankly, they drive a lot of our tourism stuff in the rest of New Zealand.

So the question I’ve got relates to clauses 5 and 6—well, actually, clauses 6, 7, and 8, really. I guess that enables those businesses that receive grants to then make a decision, whether they’re right, wrong or indifferent. That’s all very well, but we know from history that often those decisions aren’t made accurately. Really, my question for the Minister is whether the commissioner has the capacity to then manage the process as a result of what happens, because there’s a significant number of payments, grants, and, in the case of the wage subsidy, huge amounts of money being put out there by the Government to, effectively, enable business to continue and, hopefully, get going again once the lockdown situation stops and we get into our traffic light system.

I’d have to say that I don’t fully understand what businesses can open and what can’t then, so there’s still going to be a requirement for relief payments at that point. But what I really was interested in the Minister assuring us on was that the commissioner has the capacity to manage this process and that they will, effectively, I guess, be able to audit the process once those grants are made, because it’s quite confusing.

Look, the bits of this situation—I’m going to say “grants”, but it’s not a very good word for it. But where we are allocating money in relief payments and things like that, it’s not altogether clear and it hasn’t been clear right through this process, and it would be difficult to make it clear initially, because these things were put together very quickly. As I said earlier, the last bill was put together so quickly that by 4.15, there were two mistakes already and it’d only been passed a minute or two before. But I’m really interested in the Minister assuring us that there is the capacity in the system to manage the allocation of these grants and manage—I wouldn’t say the “policing” of them, but certainly to manage the way in which the commissioner is satisfied that those payments have been made in the manner that they should be made. That’s me.

I move, That the question be now put.

Thank you, Mr Chair. It would’ve been a travesty to have shut this down too early. There’s a lot of questions to be asked.

CHAIRPERSON (Adrian Rurawhe): Order! The member shouldn’t comment on such things.

I beg your pardon, Mr Chair. It wasn’t directed at you. To the Minister—

CHAIRPERSON (Adrian Rurawhe): Or comment on the ruling.

I’m still learning—like the Government, I make it up as I go along.

I just would like to return to the comments that I made earlier to the Minister around the South Island and the ongoing confusion. Look, I do acknowledge the Minister of Revenue for at least answering most of our questions, because other Ministers that have sat in the chair have tended to ignore them. But, Minister, you said earlier that the enforced lockdown, the protracted period of level 2, that the South Island’s been under was because of COVID. Well, Minister, as you well know, there have been virtually zero cases of COVID in the South Island for a year. We’ve had two recently. It wasn’t COVID, Minister; it was a Government-enforced lockdown.

I refer to the explanatory note of the bill here, Minister, where it talks about the framework to “provide the Government with flexibility to continue supporting businesses” under a variety of circumstances, including the move to the traffic light system. The variety of circumstances is what interests me here, Minister, and if I take the Canterbury DHB, for example, we have just 25 ICU beds. In Selwyn, we have 92 percent double vaccination—

💬 Chris Bishop: How much?

—92 percent double vaccination—

💬 Chris Bishop: He said it was 100 percent last week.

That was single, Christopher Bishop.

💬 Chris Bishop: Oh, sorry, sorry—100 percent?

Can I please get on with my comments? Thank you, Mr Bishop.

Minister, how are these circumstances that I’ve outlined accounted for when assessing applications for future support payments that are outlined in this bill? We still haven’t really had much of an explanation as to what level 2 as we know it now will become. Is it amber? Is it red? Is it green? What does it mean for businesses? Given the protracted period of level 2, most businesses are now really starting to suffer. Is there a clause in this bill for them to seek some redress from the Government?

We are asking these questions, Minister, because, as has been well canvassed, the public has not been allowed to ask them because of this very, very truncated process. There is no select committee process, and we would like these questions answered on behalf of our constituents and business owners around the South Island. Thank you.

Thank you, Mr Chair. Look, it’s a real pleasure to just ask the Minister a few questions. I have to say—I’ll be upfront—I really respect Minister Parker. I think he’s a very intelligent man. He’s very thoughtful, he’s always very engaging, he consumes a lot—too much—of Thomas Piketty for my liking: Time for Socialism. Apart from that I enjoy my interchange with him quite a lot. But there is a lot of problem here, and my colleague Chris Penk talked about it incredibly well. There’s no what, there’s no how, there’s no who, there’s no when—it is legislative “Hokey Pokey” as he said, quite rightly.

We are unclear on a couple of things, and I just thought there’s two areas I really want to ask the Minister some questions around hospitality and tourism, in particular, and how those businesses are positioned here. A couple of weekends ago, my colleague Erica Stanford and myself and Chris Bishop went off and we spent time with 25 Auckland-based hospitality businesses, and it’s really interesting when you sit down with people who actually run a business—not union organisers, not people from academia, not professional politicians, but people who actually do stuff, run stuff, know how to organise things, and get things done. What was interesting was they said to us, “We’re going to have a big problem around getting supply organised, because everything’s been de-inventoried and we’re going to have to re-inventory all in a hurry, and, actually, all our suppliers are going to run out of inventory and stock and it’s going to take us a while to get that up and running.” Then you say, “Well, how are you going on the staffing side?”, and they say, “Yep, well, actually, that’s going to take us a long time too, because many of our staff have been out of action and are not up to scratch or ready to serve.”, and, actually, 60 percent of them are often overseas backpackers, who aren’t in the country. So getting staff rosters together, getting people trained ready to go from day one is going to be difficult.

The other piece was around processes—so having someone in a cafe, who now has to employ a security guard at $30 an hour and man two entrances for many hours each week, and they actually deal with conflict with customers and all those sorts of issues—and that sort of sophistication that’s needed is a real challenge. But the thing they went on to say that was interesting was that “There won’t be that many domestic tourists coming into Auckland, and there certainly aren’t any international tourists.” Aucklanders will empty out, and as they hit January and as they hit February, they’re going to be going to the wall.

The question I’ve got for the Minister is: what in this support package—because it was hard to read when there’s no real specificity around—for these people? They’re Auckland-based hospitality people who have been doing it tough for a long time. How do we extend support to them, and how long will it go, what will they get, what are they entitled to, who is it for—what’s the criteria around all of that?

So that’s one set of questions I’d really appreciate an answer from the Thomas Piketty fan, and the second thing is really around tourism. Really, what we saw today was a total Clayton’s sort of announcement, really—the kind of announcement you have when you don’t really want to have an announcement—because, for tourism, it’s a really big problem, and I know this Government hasn’t been a big fan of tourism. They weren’t a big fan of it in Opposition. They certainly aren’t backing it as an industry here, in Government, and that’s a shame because, actually, tourism was bigger than our dairy sector. It was our biggest industry in this country, generating $42 billion a year, or $115 million a day. What was it—about $4 billion in GST receipts came from international visitors alone. So that industry has been structurally challenged since March 2020, and there hasn’t been enough targeted, dedicated support for those people working so incredibly hard in that industry.

Here’s the challenge, right? If you’re Chuck and Mary sitting in Iowa tonight and you’re planning that once-in-a-lifetime trip to New Zealand and you’ve got a whole bunch of choices to make, you can go to Thailand, you can go to Sydney—you can go anywhere in the world. We’ve got to try and get New Zealand up into that consideration set and make it the No. 1 choice for them for their holiday. The average American gets about two weeks’ annual leave a year. I lived there for eight years; I understand how it works. They’re going to be coming down to New Zealand on a fine service from Air New Zealand, no doubt about it—I’m sure it’s an absolutely brilliant service, as you’d expect. They arrive in New Zealand, and they’ve now got to go find somewhere to sit for seven days in a hotel while they then think about what they can do for the rest of the remaining time they’ve got.

💬 Andrew Bayly: That is a compelling marketing proposition.

It is. So the point is in the tourism sector, there have been 380,000 people employed. It was our biggest sector. So we’re having a Clayton’s opening—there is nothing in this bill. There is nothing in the announcements today that says, “Tourism’s open for business. Our biggest sector is back on track again.”, and I don’t get why this Government doesn’t like tourism. I don’t know what it is in the DNA; you’ve just never been big fans of it at all, and yet it’s a fantastic industry with amazing people doing incredible things each and every day. But I can tell you, it’s a competitive market. People have choices about where they go and what they do, and they won’t be choosing to come here. They won’t be choosing to spend their money in our local economy, and it contributes 20 percent of our exports. So that’s a big, big thing.

So I guess, Minister, I just really want to understand what’s in it for the Auckland hospitality people. How long does the targeted support continue beyond the immediate rush, because after Christmas it’s all emptying out—there’s nothing for them there. What are we doing about these great folk in tourism who run awesome businesses, who have stuck with us and done everything we’ve asked of them, but they are structurally challenged in this sector, over any other sector in our economy, and there’s not enough in there to support them and to help them. I’d really appreciate your thoughts around that.

I move, That the question be now put.

Thank you very much, Mr Chair, and it is a great pleasure to take a call on this part in this bill. I have deliberately not made a contribution so far in the debate because I wanted to see the Minister’s responses and I wanted to see the contributions made by my colleagues. I also did a lot of speaking on the bill that preceded this one, so I wanted to, frankly, just take five and chill out for a bit. It’s great to see the Minister of Revenue here in the chair. He does engage and we look forward to that contribution. As Mr Luxon says, he’s too much of a fan of Piketty, but he’s a diligent and conscientious Minister.

But I wanted to pick up on something that Mr Luxon said about the visit to Auckland hospitality by him and me and my colleague and friend Erica Stanford a couple of Sundays ago, because I’ve got to tell you, it’s not until you actually go and talk to Auckland businesses and business owners that you get a sense of the despair in Auckland, particularly hospitality and retail and places like hairdressers. The people we talked to—without divulging too much detail of their own personal lives—were mortgaging their homes, selling their cars, and maxing out their credit cards just to get through the next week. Yep, they’ve had the wage subsidy and, yep, that goes some way, but we are really talking about people who are just struggling literally to survive week by week.

So the real question for the Government is: what is going to be done about those sorts of businesses as we head into December and as we head into January and the onset of the traffic light framework? Actually, the traffic light framework gives with one hand but it takes away with the other, because, yep, it’s true that there are some more freedoms for the vaccinated and, actually, not so much for the unvaccinated, but there are some more freedoms for the vaccinated under the traffic light system. But Auckland enters at red. If Auckland enters at red, and even at red there are limits on the number of people you can have in a bar and the number of people you can have in a cafe—even for vaccinated customers, you have to be seated, you have to be separated, and you’ve got capacity limits. The very strong point that was made to us—and I’m sure Erica Stanford would agree with me—by people in Auckland hospitality was—

💬 Hon Member: Make it green.

—exactly—why are we entering at red, and why are we not entering at green or maybe orange or amber, but they actually want to enter at green.

If you look at the framework, red is defined as when the hospital system is facing unsustainable pressure. Well, the Prime Minister says the hospital system is coping, Dr Bloomfield says that things are basically pretty good, and when they get asked about summer, they say that that’s what the modelling shows as well—that we can cope. That’s the Government’s own criteria, and it doesn’t bode well for the traffic light framework that when it starts, the Government will place Auckland into a setting that isn’t borne out by the evidence.

So then you say, well, what about everywhere else, and I haven’t even covered the point that it’s totally unclear what every other region will enter at. I live in Wellington. There is, basically, no COVID in Wellington. Wellington City is, I think, at 94 or 95 percent double vaccination. What will Wellington enter at? I don’t know—I’ve got no idea. What will the South Island enter at, or parts of the South Island? I’ve got no idea. We’re told it will relate to vaccination status and vaccination numbers. Well, what’s the threshold?

It starts next week. Look, it actually starts next Friday. I don’t think it’s unreasonable for people to have some sense as to what each city they live in will enter the traffic light framework at. People want a bit of certainty and clarity so that they can plan their lives and plan what they’re going to be doing in the run-up until Christmas.

So there is a massive opacity around how all this is going to work. It is incredibly untransparent, incredibly confusing, and people should not have to turn on the TV every second day to find out the next announcement about what their life is going to be like in a couple of weeks’ time, particularly when it keeps changing. So the take-home point for the Government is: what are we going to do about the businesses that Mr Luxon talked about, because they deserve support, and they deserve some clarity and some certainty, and at the moment they have none of those things.

In respect of Chris Bishop’s comments and questions, this bill doesn’t set up the COVID-19 Protection Framework or the traffic light system, and so I can’t answer those questions in the light of this particular bill because they are irrelevant to it.

In respect of Christopher Luxon’s questions, he would be interested to know that the support of Auckland through the resurgence payments system under the current legislative framework has meant that 71 percent of the latest resurgence support payments has gone to Auckland, and if the National Party doesn’t vote for this bill, suggesting, as they have said, that they don’t want this to continue for the future, then that level of support could not continue into the future, which I find difficult to reconcile with earlier comments from Erica Stanford, who wanted more information as to what the details would be, but still doesn’t seem to be willing to support the legislative framework that is necessary for resurgence support payments to continue under the new framework.

Finally, I would say that, yes, I am respectful of Thomas Piketty, but I’m also quite interested in the works Esther Deflo, Nobel Laureate, at the moment.

Thank you, Mr Chair. What an exciting night, isn’t it? We’ve got all our team here making wonderful contributions—yeah, I can see you down the back there, Mr Watts. We’ve even got the exciting, dynamic Minister in the chair, who’s contributing.

The only thing I’ve got to say is that there’s a disconcerting thing happening on the Government bench side. Just above one of the members over there, there’s a light that’s flickering on and off, but most of the time it’s off. I don’t know what the implication is, because, when it flicks on and off, I don’t know whether it’s saying to the Labour backbenchers, “Wakey, wakey! Wakey, wakey! Come on, contribute to this debate.” But now, you see, it’s off—you see, it’s out. Is that darkness? Does it mean it’s darkness for all those businesses that are going broke in Auckland, Waikato, Rotorua, Queenstown? Does that light mean—

💬 Hon Member: It’s going out.

it’s out—their futures are extinguished, or does it mean that the Labour backbench has gone to sleep? I think it’s the latter, I really do. So I just highlight this because I think we need to get some people in here to fix that light, because this piece of legislation needs all the light, given that it’s not going to go through a select committee process.

Now, I’ve got four proposed tabled amendments, and I’ve got the opportunity now to speak to the second of my four. So I just want to ask a question—and this relates to new section 7AAB(2) in clause 5(1), and hopefully the Minister can help me on this—about the use of the word “grant”: “The Commissioner, on behalf of the Crown, may make a grant under the CSP scheme … to a person”, and it goes on.

So I just want to ask the Minister what is meant by “grant”, because, of course, we’ve had two schemes. We’ve had the resurgence payments scheme, and we’ve had the employment support scheme—the workers’ employment scheme—but is it intended by the legislation in this piece that we’re going to move to a different type of payment framework, and should we read too much into that word “grant”? From what I understand, this is looking to replace the resurgence payments scheme, and, therefore, what does that mean? Hopefully he can allay our fears. Again, I think we need to bear in mind that we’re not speaking to Mr Parker; what we’re speaking to is the audience of those many hundreds of thousands of people who are affected by the terrible plight they find themselves in.

I do take issue with a comment that the Minister said before. It’s not the virus that’s caused the problem; it is the Government’s reaction and the closure of businesses that has caused the problem. It is not the virus; it is the actions of the Government to impose a lockdown on huge swaths of New Zealand areas and businesses, and that is why this Government is having to put in these types of arrangements—and we welcome that they have—but, of course, as we’ve all said, on many occasions, unfortunately, this bill is absolutely devoid of what that means.

Now, talking specifically to my tabled amendment, it really relates to the issue of who has the jurisdiction to determine the setting of the criteria, and, of course, as the Minister will know, under new section 7AAB(3) in clause 5(1), the bill empowers the Commissioner of Inland Revenue. The IRD commissioner “must set out the procedure required”—she must, if it’s the current commissioner—“for a person to make an application for a grant:”—same word, again, and—“must determine—(i) the eligibility requirements that a person must meet to qualify for a grant:”—and, furthermore—“(ii) the terms and conditions that apply to a grant:”.

Now, my proposed tabled amendment does away with the rights of the commissioner to make such determinations. We believe that is important. These are political decisions set by the executive, and it is important that these are executive decisions. The discretion of the commissioner to look at determining the eligibility requirements that a person must meet to qualify for the grant and terms and conditions, we think, is inappropriate, and, therefore, my tabled amendment deals with this issue. I’d really appreciate it if the Minister could respond on both those issues: the issue of “grant” and also why it should not be the executive rather than the commissioner who is making the determination.

I move, That the question be now put.

The question is that Andrew Bayly’s tabled amendment to clause 4 to amend the definition of COVID-19 Support Payments scheme be agreed to.

The question is that Andrew Bayly’s tabled amendments to clause 5 to remove the power of the Commissioner of IRD to determine eligibility requirements be agreed to.

The question is that Andrew Bayly’s tabled amendment to clause 5 to set a specific date and time for eligibility requirements to be published be agreed to.

The question is that Andrew Bayly’s tabled amendment to clause 5 to amend new section 7AAC(2)(a)(ii) to replace “6 months” with “2 months” be agreed to.

The question is that Simon O’Connor’s tabled amendments to clause 5 to allow new business owners of existing businesses to claim future payments be agreed to.