Crown Minerals (Decommissioning and Other Matters) Amendment Bill

on behalf of the Minister of Energy and Resources: I present a legislative statement on the Crown Minerals (Decommissioning and Other Matters) Amendment Bill.

ASSISTANT SPEAKER (Hon Jenny Salesa): That legislative statement is published under the authority of the House and can be found on the Parliament website.

I move, That the Crown Minerals (Decommissioning and Other Matters) Amendment Bill be now read a third time.

I want to thank all members across the House who have contributed to the debate on this important bill. This bill amends the Crown Minerals Act 1991. That is the principal piece of legislation that governs Crown-owned resources, including petroleum. The bill lays the foundation for a stronger, more proactive regulation of petroleum-decommissioning activities. It is designed to mitigate the risk to the Crown and taxpayer of having to fund decommissioning in the event that a permit or licence holder is unable to do so.

Decommissioning can include removing infrastructure, plugging and abandoning wells, and undertaking site restoration. Significant risk to health and safety and the environment could arise if petroleum fields are not cleaned up and made safe at the appropriate time. The bill clarifies expectations of permit and licence holders by introducing an explicit statutory obligation to carry out and meet the costs of decommissioning.

There are penalties for the failure to comply with the obligation. It also introduces perpetual liability. This means that if someone transfers their interest in a permit or licence, they will continue to be held liable for the costs of decommissioning in the event that the current permit or licence holder fails to fulfil their obligations.

An important aspect of the new regime will be improved monitoring and oversight. The bill provides the regulator with new powers to monitor a permit or licence holder’s financial position and to carry out assessments of their financial capability. Permit and licence holders will also be required to provide information related to decommissioning, including cost estimates and plans.

The bill requires permit and licence holders to establish a financial security which can be used to fund decommissioning in the event that something goes wrong. The amount and kind will be decided on a case by case basis, taking into account factors such as the estimated costs of decommissioning, when decommissioning will occur, and any emerging risks. The bill also requires permit and licence holders to make a payment or provide a financial security that could be put towards the cost of any post-decommissioning work required. This includes the monitoring, maintenance, and remediation of wells and infrastructure after decommissioning has been completed.

Moving away from decommissioning-specific provisions, the bill introduces new enforcement tools such as compliance notices and infringement offences. These changes will allow the regulator to take a proportionate and effective approach to compliance across the Crown Minerals Act.

The bill also makes changes to the tests used when someone acquires a permit. The decision maker will have to be satisfied the proposed permit holder will be highly likely to comply with certain conditions. It also makes various technical amendments to the Crown Minerals Act to improve administration and efficiency.

The bill covers a range of areas. As well as debate in the House, there was feedback from a wide range of parties during the select committee submissions process. I’d like to acknowledge and thank each and every person who took the time to engage in the submissions process. The Economic Development, Science and Innovation Committee made valuable recommendations during their examination of the bill, and I too want to acknowledge the members of that committee for their time and their consideration in deliberations of the matters before them.

While numerous changes were made by the select committee in response to the submissions, the key provisions I have outlined were retained in order to mitigate the risk to the Crown and to the taxpayer. The situation with the Tūī permit, where the Crown stepped in to fund decommissioning at considerable cost to the taxpayer, highlighted the need for the greater protections this bill provides. However, I want this House to be assured that this bill is not a knee-jerk reaction to the Tūī situation, but it addresses a fundamental gap in the Crown Minerals Act and takes a longer-term view of what we need to do to improve our regulation of a changing sector.

The aim is to provide for a flexible approach to regulation which will allow requirements to be tailored over time. Therefore, I commend this bill to the House.

The question is that the motion be agreed to.

Thank you, Mr Speaker. I’m not sure that it’s a pleasure to take a call on this particular bill. In fact, if it didn’t get finished this afternoon it would be no great blow to the National Party, because the decommissioning bill is another blow to energy affordability and security and it’s a complete overreach. I listened to what the Minister said in her speech in and around the legislative statement, and none of us would’ve ever wanted to have happen what happened at the Tūī field, with Tamarind, because that’s one of those environmental things that shouldn’t happen, but, unfortunately, it did. It was a one-off, and this industry is actually very good at doing its decommissioning and putting steps in place to make sure that the decommissioning happens.

The saddest thing about sitting on the Economic Development, Science and Innovation Committee—and I’m not part of the select committee that looked at this bill, but I did sit in, and a lot of this happened on Zoom during the most recent lockdown when we were in level 4. I was sitting at my kitchen table back in Taranaki, listening to the submissions, and I found that while the Minister who just spoke said that there have been quite a lot of changes to this bill, actually, the amount of changes that were made to this bill was quite disappointing. I have worked with some bills where Ministers were quite free and open to making changes, and I didn’t find that same sort of flexibility when it came to working with the committee on this particular bill. I found that, particularly, the Government members of the committee were very quiet during the submission process, and that gave us a great opportunity to ask a lot of questions, which is good in itself, but I would’ve liked those members to have taken a bit more interest in advancing this to get a bill that was much better than what it is.

We don’t think this bill is necessary. We believe that the industry is taking care of it. When we were in the committee stage I just wanted to make note the other day that the Minister of Energy and Resources, Minister Woods—despite us going through the facts—was talking about how much the Tamarind Tūī issue cost this Government, and there’s no denying that it was a cost to the Government. But we’re also putting it to the Government that every year, this industry contributes around $2.5 billion to the economy, it brings in around $750 million worth of export receipts, and it generates approximately $500 million in royalties income for the Crown.

Now, the Minister made a comment that with the money that Government had to pay out for the decommissioning, imagine how many hospitals and schools and things we could have built, and I don’t dispute that. But I also, at the same time when we spoke about the bill, made the point that coming from Taranaki, I have seen many, many buildings, functions, and activities in the community—assets of the community—that have been funded by this industry. I made particular note of the swimming pool in New Plymouth, the New Plymouth aquatic centre, and I was really disappointed that the Minister chose to scoff about a swimming pool, when, actually, that missed the whole point of this. I did explain to the Minister that you have two sides on every ledger. There are benefits and there are costs, and, unfortunately, with this bill the Minister has focused on the costs and completely forgets about the other side.

Mr Grant Robertson might be more interested in the other side of the equation, given that he tends to be the one that measures where the money comes from. I also would acknowledge that Minister Robertson is always acknowledging where the agriculture money comes from, and it’s not something that we hear a lot of from Ministers on the other side of the House, either.

So when this bill started, we supported the intent of the bill because we do support decommissioning—but, as I said, so does the industry—and we acknowledge the responsibility of the petroleum sector to decommission gasfields in a safe and lasting way. But this bill, like a number of bills, is a huge overreach, and it’s just an example of another bad bill that we have standing here this week, which is going to, probably during the course of this day, get passed through Parliament if the length of the Government speeches this week is anything to go by.

The bill is applied retrospectively. It will impact on existing permit and licence holders. It alters their rights and duties, and some of these have been in place for decades. Where else do you make a contract and a deal and then the Government comes along and retrospectively replaces the contract or the expectations that a company has with something else? It’s not normally—although once you’ve got a precursor who knows what’s likely to happen.

It will reduce New Zealand’s appeal as a location for petroleum investment, and at the moment, we’ve already seen in 2021 a shortage of gas, we have seen low lake levels, and we don’t have enough renewable energy to get us through the next few years. So what I suggest is that if this bill is going to take us down a track where it’s going to discourage further international investment, it’s just going to take us further and further away from the goals that we have to get to our renewable energy targets.

The BusinessNZ Energy Council says that the proposed rule would create a perpetual liability on energy businesses and it should be strongly opposed: “We can think no other situation in New Zealand where a business is legitimately sold, and the seller is responsible for any liabilities that might be accrued by the new owner.” It’s a fundamental change to how we do business in this country.

The Government talks about this being one of the strongest regulatory legislative components that there is in this industry in the world, and I notice that when this Government talks about things—particularly the Prime Minister—everything’s about being the best in the world or on the top of the world and everything is so important. It is always wanting to be the first or the best in the world, and I notice that the Prime Minister hasn’t yet, that I’ve seen, picked up the KPMG report from about three weeks ago, which graded 32 countries in the world on their zero-carbon readiness. They graded 32 countries and New Zealand rated ninth—so we’ve got a bit of work to do—and agriculture rated first. Now, we do have work to do in agriculture as well, but penalising those who are at the top of the game doesn’t exactly help the others at the bottom of game produce zero-carbon ready food.

The cost of this bill greatly outweighs the benefits. The proposal is estimated to cost a net $1 billion, and for every $1 spent, we will see 11c worth of benefits.

💬 Hon Member: 11c?

I’ll just repeat that because I can hear some shock coming from some of the National members behind me: for every $1 spent, we will see 11c worth of benefits. Now, not much has been making sense in some of the other legislation we’ve been doing this week—you know, all the stuff around traffic lights, businesses, and uncertainty, and there’s huge uncertainty in the energy industry. There’s huge uncertainty in the electorates of some members who are sitting behind me from Auckland, who every day have to be out there talking to their businesses and trying to console people who are trying to go to sleep at night and are waking up in the morning and finding that their business has just lost a whole lot more money, without any understanding from the Government.

So for every $1 spent, there’s 11c worth of benefits. That might be a good enough calculation for the Minister of Energy and Resources. It might be a good enough piece of numerical data for the people on the other side of the House today, but it’s certainly not a good enough return for this side of the House—the National Party. We value this energy industry, which has not only contributed to the energy security of New Zealand; it has contributed a whole lot of other things. I’m really disappointed that this bill is going through the House, and we in the National Party oppose it.

Order! The member’s time has expired.

Thank you, Mr Speaker. I appreciate the opportunity to take a call on this bill at the third reading: the Crown Minerals (Decommissioning and Other Matters) Amendment Bill. As chair of the Economic Development, Science and Innovation Committee—our committee had the pleasure of shepherding this bill through—I’d like to thank all of the members of the committee. I’d like to thank the members in this House who spoke either in favour or against this bill. I’d particularly like to thank all the officials, who have worked really hard in terms of bringing the bill to this point, and also the number of submitters who made their submissions.

Barbara Kuriger, the previous member who just resumed her seat, talked about how this Government wants to be the best in the world. But look, it’s not about being the best in the world; it’s about doing the right thing. That’s simply what this bill is about—it’s about doing the right thing for the environment—and the aspect around clean-up is absolutely the right thing to do. Now, some members may argue where’s the point of reaching too far, or where’s the point of not doing enough, and there may be some philosophical differences there. But in terms of this side of the House, we think this bill is about right in terms of ensuring that the New Zealand taxpayer doesn’t have to pay for the decommissioning of petroleum activities.

So the bill, basically, ensures that those who undertook and profited from petroleum activities will pay their fair share in the clean-up. Now, I don’t really need to go into the details because we heard from the Minister’s speech quite clearly what the bill does. But this side of the House commends this bill at the third reading. Thank you.

When our spokesperson Barbara Kuriger spoke in the debate a moment ago, she said that for every $1 spent, there was an 11c benefit for New Zealand. The problem we have is that if businesses in New Zealand ran their accounts in the way the Government does when it comes to investment, there would be even more businesses closing than the 28,000 that closed over the last few months because of the Government’s extremely restrictive COVID policies.

I feel for our officials. I thank them for their work, but I could tell when they were listening to submitters that they actually thought there was probably a better way to do this, but were not able to bring that advice frankly to the Economic Development, Science and Innovation Committee because of the position the Government had had. I also feel for our chair. He’s actually one of the best chairs of committees I’ve served on. He’s very fair, everyone gets a fair hearing, and we often work to find solutions to challenges or problems that submitters have raised to make legislation better. But the reason I feel for him in this instance is I think it feels like he and the other members of the committee were whipped into supporting this and weren’t allowed to make the changes necessary to make it a good piece of legislation.

You see, we do support decommissioning. The industry supports decommissioning. It’s actually lazy for the Government to say National doesn’t care about these things. We do, but you need good rules and good regulations that people understand and that make sense, because when you don’t, there is confusion when it comes to things like this.

It means less investment in New Zealand from overseas. The Government has borrowed and spent $97.5 billion under the name of COVID but most of it not on COVID. We need investment from overseas to grow the economy to be able to start paying that back, or else the poor old Kiwi workers’ taxes are going to have to go up under a Labour Government. They’ll take more from them to pay back the reckless spending we’ve seen over the last year and a half. The problem with legislation like this is when you don’t get it right, it sends a signal to the rest of the world that New Zealand is not open for business. When the Government says they want to be world best, well, they’re not world best when it comes to having good investors in New Zealand and the benefits that flow through to Kiwis.

The new member of Parliament for New Plymouth, Glen Bennett—I’m sure he wanted to improve the legislation, because his electorate is in the heart of the oil and gas area of New Zealand. Before he was the MP, when Jonathan Young was the hard-working, successful MP for New Plymouth, do you know that the average income in New Plymouth was one of the highest in the country of any region, and the unemployment rate was one of the lowest of any region in New Zealand, even during the global financial crisis, when the rest of the country’s economy was challenged because businesses were losing markets overseas and they were losing jobs? Do you know why that is? Because of investment in oil and gas, and particularly gasfields.

When the Prime Minister made that announcement on the steps of Parliament after meeting protesters in Greenpeace in the first term, instead of meeting the President of Indonesia and talking about maybe a trade deal with Indonesia, she stood him up and made him wait. He was a President from a country that actually can do a huge amount for New Zealand, but she stood him up to go and make an announcement of a ban on oil and gas exploration.

Do you know what happened the very next day? People that had large incomes and that were working in New Plymouth went to their bank to say, “We want to buy a house. We need a mortgage.”, and the bank said no because they had no certainty for employment for the future. The engineering workshop started not taking on young people and laying off workers. Now New Plymouth has a higher unemployment rate than it should and its average income has shrunk quite, quite significantly because of bad decision-making.

That’s why I think Glen Bennett, the MP for New Plymouth, wanted to see changes here to make sure that the industry had to be responsible, that the legislation was fair, and that it was well understood so we could still have investment from overseas in New Zealand, particularly in his electorate. That hasn’t happened, and I feel for him because he will have to account for that at the next election, and the platitudes that come from the Government around things like this won’t actually work then because the very people that deserve support and need those jobs have missed out because of that previous decision of Jacinda Ardern, the Prime Minister, and now this legislation.

This bill is retrospective. What that means is decisions that were made years ago are now impacted. It also means that for people that were directors of companies many, many years ago, who are no longer directors, the rights have been sold, the companies have been sold, but they still have liability—retrospective liability. That is not reasonable, it is not fair, and it just does not make sense. It is the case that there was one problem that the Government had to fix, but there was one problem. Every other time, this works well, and the Government’s reaction to that one problem they had to work out was to blame the industry and overburden them with unreasonable legislation that is not going to work as well as they say.

There are 11,000 highly skilled New Zealanders and others employed in this sector. Well, because of legislation like this, that number is going down at a time when we need higher-paying jobs, jobs built on good technology.

We need to partner with countries overseas. We should be making it easier for people to come and invest actively in New Zealand, and to create jobs and to create partnerships, so more of those young people in New Plymouth and other parts of the country get those apprenticeships and get the skills to actually earn more and contribute more to society. That’s the way the Government gets to have the tax it needs to pay back the huge debt that they’ve run up: through increasing productivity and through greater investment from better jobs; not putting the tax rate up, as we will see in this term and many terms to come.

For every $1 spent, only an 11c return—my gosh! No wonder so many Labour MPs have given up their businesses and come to this House, or so few of them had businesses before they came here, because that is not a good return at all. [Labour members interject] All of a sudden they’ve woken up—look at that. So they didn’t wake up because of the jobs that have been ruined and because the investment has disappeared or because they’ve ruined Glen Bennett’s electorate seat for him; they woke up because they’ve been accused of not knowing how to run a business. That proves my point, because they were asleep at the wheel then, they woke up, and now they’ve gone back to sleep again. So I’ll speak more quietly; I wouldn’t like to rark them up. Poor Glen is sitting there thinking he wants to get back to his electorate to start explaining how he wanted changes to this legislation but that the changes couldn’t come through.

Business New Zealand said that creating perpetual liability on industry business should be strongly opposed. They don’t do these things lightly. Actually, they are a measured organisation that looks after the interests of New Zealand, not just businesses, and they said, “We can think of no other situation in New Zealand where a business is legitimately sold, and the seller is responsible for any liabilities which might be accrued by the new owner.” That’s fundamental.

I tell you what, if a New Zealand company was to invest overseas and there was legislation like this, they would come running to the Government saying, “That’s unfair. Can you go and sort it?” If this was a rule in Indonesia, they would come to the Prime Minister and say, “Prime Minister, could you arrange a meeting with the President of Indonesia to say this is unreasonable? We want to invest in that country. There’ll be a return for New Zealand. It will be good for their economy. We’ll create jobs for the people of Indonesia. Can we get this sorted out so we have greater certainty because there is uncertainty here? It is not worth the risk to invest in that country.”, and the Prime Minister, Jacinda Ardern, would say, “Actually, I can’t do that, because he’s waiting upstairs in the Beehive and I’m down there banning oil and gas exploration.”

Turn that around; it’s exactly the same thing. We do need investment in New Zealand. We are not a wealthy country. In fact, now, after COVID, because of the Government’s reckless borrowing and spending, we are an even poorer country than we were. We have people in New Zealand that have to choose between paying their rent or feeding their kids. They work hard, they are the working poor.

I cannot see why the changes were needed to make this legislation actually achieve what it needs to, which is to hold those to account when they give up rights or they have to decommission, but not retrospectively, not unreasonably, not punitively. We could have got it right so the investment may have been a 40 or 50 percent return on every dollar spent. That would have been a great start. That’s something that members of the Government should be screaming and yelling about, not proving they know nothing about running businesses.

Thank you, Mr Speaker. I found that quite hard listening to the previous contribution, just because, first of all, I think my colleague—especially Glen Bennett—doesn’t wish to be spoken on behalf of. I’m perfectly sure that he would support this bill and he has in the past, and he has done great work on the Economic Development, Science and Innovation Committee liaising, and questioning not only the submitters but also the officials.

Can I start by thanking all the officials who have worked on the bill with us. It’s actually one of the biggest groups of officials I’ve ever seen on any of the bills I’ve been working on in the last year, and those officials are really top of the industry. They know every detail about this bill. They answered every question we posed to them with great detail and great knowledge, and so I thank everyone who worked on this bill.

Can I make it really clear that what the National Party today have been saying is, basically, they want to create a back door for the industry. Look, the equation is simple: if you actually decommission the field that you made money out of, this bill will have nothing to do with you. If you just do the right thing, you don’t actually have to fear this bill, so why are we even arguing about this when you can just do the right thing.

So if they’re saying that the industry will do the right thing, then the industry should have no problem with this bill, because it will have nothing to do with them if they do the right thing and they pay for their decommissioning, unlike what we had to do, which was put up $155 million to decommission the previous oilfield. So that is what we have to be cognisant of when we know that we have to manage the economy very, very carefully. We have to know that we need to look after what the taxpayers give us. Not only is it the responsibility of looking after the coffers but also to look after the environment, so every decommissioning needs to be done right. That’s why I commend this bill to the House.

Thank you, Mr Speaker. I rise on behalf of the Green Party with great pleasure to speak on the third reading of the Crown Minerals (Decommissioning and Other Matters) Amendment Bill.

This has been a while coming, really. I think, as a country, we’ve recognised that there’s been a problem for quite a few years, and I’d start by going back to my previous colleague Gareth Hughes’ work in 2017, where he exposed the fact that the Crown was exposed to potential costs of $800 million over the next 20 years relating to decommissioning of oil rigs because of the way decommissioning costs could then be written off against tax liabilities. Between that time and this bill coming to the House in the first place, the Government had been forced to spend an additional $374 million on one single decommissioning project after Tamarind Resources structured its permit ownership to avoid having to pay for its own decommissioning. It’s the privatising of profit and the socialising of costs, and that has been our reality in this country in relation to this infrastructure.

I do want to point as well to the fact that we are in a climate crisis. It’s pretty important that we face up to that fact. We’ve just had an international meeting where the collective commitments across the world were not enough to be able to meet the climate crisis. We have to be, collectively around the world, stepping up our efforts.

That is going to require a just transition, and part of the process of a just transition, as well as getting people out of extractive industries and into really productive and sustaining work, is also looking after the environment after those industries have gone and about fixing up the damage that has been done and putting the cost of that where it belongs, with the people who have been making the profits all the way along. This is a pretty important principle for us in the Greens, and it is clear to us that we need a regulatory regime in Aotearoa New Zealand that is based on “polluter pays” so that those who have the benefit from environmentally harmful activities also carry the costs of the associated remediation and clean-up activities. It doesn’t feel like a strange idea to me; it just seems pretty basic common sense. It was how I was brought up: if you do the damage, you pay for the damage.

This bill fixes up a lot of these regulatory gaps that we’ve had to ensure that there is a responsibility into the future, and I do want to acknowledge the work of the Economic Development, Science and Innovation Committee. That was quite extensive. I was involved in some of the early stages of this, which shows how extensive it was, because I haven’t been on that committee this term. There is now in this bill that we are passing today a clear obligation to decommission, much greater monitoring powers, and a requirement to obtain and maintain a financial security to carry out decommissioning work.

So this is a really important step forward for us as a country right now, but we still, obviously, have more work to do in the mining space to protect all of our environment and all of our communities. But the Greens are very pleased to commend this bill to the House.

Thank you, Mr Speaker. The ACT Party opposes this bill not only because it’s a flawed and bad piece of legislation; we also have the unfortunate job of explaining to New Zealanders—because we always follow the Green Party in speeches in the House—why the Green Party’s environmental solutions to environmental problems simply won’t work and that more taxes, more bans, more regulations heaped on some of New Zealand’s most cutting-edge, high-performing businesses actually won’t help improve the environment. The problem this legislation is intended to solve is that some oil and gas exploration structures may at the end of their lives be left without being remediated, and there are some simple solutions—some simple regulatory solutions—proposed by the industry that they would accept in order to protect the Crown and to protect New Zealand’s environment from the risk that petrochemical structures may be left behind and not cleaned up.

Some of the things that the industry has said they would be happy to accept and that the ACT Party supports are that operators should take responsibility for decommissioning and avoid what happened at the Tūī field, that decommissioning is a core element of good industry practice, and that this obligation should be clarified for all industry operators. The industry and the ACT Party also agree that the Crown should be able to regularly assess the financial capability of organisations carrying out activities that have significant impacts on the environment, like the petroleum and gas exploration and production industry, but that the regulations that allow Government to look deep into their business and to fish around and request information and go on trawling expeditions must be limited to only the information that’s necessary for determining whether these businesses can meet their financial obligations.

The industry is an industry that actually supports thousands of jobs in Taranaki, and, through those jobs, supports communities in a place where not everybody finishes high school. Not everybody in Taranaki goes off to university and gets an arts degree, or becomes a lawyer and ends up on the backbench of the Labour Party. That’s a privilege only accorded to a few people from Taranaki. What most people in Taranaki do is they leave school. If they get qualified, they go to polytech, they go to a local college, they learn how to weld, and they learn how to operate in the oil and gas industry. They learn how to participate in the manufacturing industries that support the oil and gas and energy industry that underpins New Zealand’s energy security, New Zealand’s energy affordability.

Actually, these people in Taranaki, whether they went to university or got a qualification in specialist welding from their local technical college, are the ones who actually implement the best-practice environmental technology in the oil and gas industry in New Zealand. These are the people who put the scrubbers together. These are the people who install the waste-water systems and the oil-water separation systems, because New Zealand’s energy industry meets the highest environmental performance standards of any energy industry in the world. That’s something that the ACT Party celebrates and that we think New Zealanders should be proud of, and that’s why we don’t understand why the Government, in seeking to solve a problem of one operator who had failed to fulfil their responsibilities to clean up the environment, has, essentially, taken what appears to be a pick and mix, “why not pick them all” solution. So when trying to understand the solutions the Government came up with to hold petrochemical companies to account for their operations at the end of their lifetime, they came up with a trailing or perpetual liability on directors so that anybody who’s been a director of these businesses ever—even if they sold them; even if it was a decade ago—would be held liable.

They came up with a post-decommissioning fund. Now, in my experience as an environmental engineer carrying out actual environmental remediations on some of New Zealand’s most hazardous sites, sites where pesticides were manufactured, where timber treatment chemicals were used, and, during their use at a time even before I was born, when safety conditions and environmental best practice wasn’t what it is now, there was soil contamination and water contamination. But when you go and you clean up a site and you meet the resource consent conditions or the consent conditions for the clean-up, then you get it signed off by the engineers and the scientists and local Government—and, in this case, of course, energy is regulated by the Ministry of Business, Innovation and Employment—and you get signed off. At that point, they say, “Thank you for decommissioning and decontaminating your site. Here is the certificate to say you’ve met your obligations. Here’s your bond back. Here’s a letter to say that we’re satisfied with your environmental performance.”

Well, what this bill proposes to do and what the Government came up with is a post-decommissioning fund, which, essentially, makes the operators pay into a fund in case one of their competitors or another business down the track fails to meet their obligations. Even though the company itself has met its obligations and been signed off by the regulator, they were going to be asked to pay for other people’s failures. Now, that makes absolutely no sense to anyone in business and I bet it makes no sense to anyone sitting at home that having cleaned up your own site, the Government’s going to say, “But we want you to pay into a fund to clean up other people’s sites who’ve failed to clean up.”

Then they also introduced a mandatory financial security. Well, most of these businesses already have insurances, they have international shareholders, and they have obligations and responsibilities that extend outside of New Zealand, because there’s very few New Zealand - only energy companies. That’s because over the years, it’s become harder and harder to do business in this sector, even without the kind of pick and mix, lolly scramble approach to making legislation that this bill indicates is the Government’s way of making laws.

The other thing that the industry pointed out was the bill would require as a default total removal of all the infrastructure. Now, a lot of this infrastructure is below ground level, or where it does appear at ground level, you actually want to leave something in place so that you can monitor it and be able to come back and check it later. Total removal of all infrastructure makes no technical sense, even though it might make sense to people who’ve never actually operated in the environmental engineering, environmental rehabilitation space.

So ACT believes that polluters must pay. This legislation doesn’t simply create a regulatory setting so that the obligation is on energy companies to clean up at the end of their operation and hand over a clean site to those who come after. It’s actually the kind of regulation that will cause business owners, directors, and investors to say, “I’m not sure whether we should be in New Zealand. We don’t think it’s a good place to invest and do business.”

What this puts at risk are jobs, not just in Taranaki, but in all the supporting industries, the manufacturing, and all of those suppliers who supply those oil rigs and who supply all of the onshore production. All of those jobs are at risk. The Gas Industry Co. has said that at some point, if the Government is successful in its crusade against the gas industry and that part of the energy sector, there may not be enough players to pay to maintain the network transmission infrastructure. So even though the Climate Change Commission has said, “We’re going to need gas up to 2050 to bridge where we are now in terms of renewable energy. To where we want to get to in real energy, we’re going to need gas.”, actually, who’s going to pay to maintain the pipe if the Government has, essentially, sterilised the industry and turned away people who would be prepared to invest in our energy security, affordability, and reliability, and continue investing for decades to come?

So what the ACT Party says is that we oppose this bill because it’s not just one piece of bad regulation; they’ve got four elements in here which are all bad for business. They set a terrible precedent with trailing and perpetual liability, piling on costs on to businesses that actually do the right thing. That’s why the ACT Party cannot support this bill.

It’s an absolute pleasure to rise in support of this bill, particularly having heard the speeches from the Opposition today and in other readings. I’m really concerned that the New Zealand public see what’s happened today, because what we’ve actually seen is what people who say that they believe in self-responsibility do when it’s about small people, but when it’s about big multinationals, it goes out the window.

What we have here is we have an industry that is made up of big, big multinationals and the rich list, and they actually went out and they built an infrastructure which has hazards associated with it. Many, many of those businesses are so big that they lose their humanity—let’s face it—and what they do is they forget and they calculate in that they will be able to actually sell these companies off to another company, and because they’re shielded by limited liability, they won’t end up paying for the mess they made.

Not only that; the environment will suffer—they are out of there—and that is what happened in the case of Tamarind. What happened with Tamarind was that someone else took on the endgame and those people did not have the cash at hand and maybe they didn’t even have the will to actually clean up, and guess who ended up paying for that? Actually, it’s not the Government, as is suggested when we want to sanitise these things; it’s the taxpayer. It’s the very people that Simon Court has described. Those are the people who actually go to the polytech and work in small industries and work in industry. Those are the people who end up paying their hard-earned dollars to clean up after a multinational who has made a massive amount of money and skipped, and that is totally unacceptable.

That is where our system breaks down and, actually, the National Party and ACT look like what they are: the supporters of big business and big multinationals and not the supporters of the taxpayers. I too believe in self-responsibility, and so I am proud to support this bill.

This is a split call.

Oh, Mr Speaker, goodness gracious me! We’re near the end of the day and we hear from Helen White, the member from Auckland Central about how bad these big multinationals are, these big, bad businesses that pay all this tax to this country, that employ how many people in Auckland Central, I wonder—but we’re all focused on those big, bad businesses. Well, on this side of the House, we are absolutely not. Do you know what? We actually talk to those businesses. We actually understand those businesses—something that that member on that side would not have a clue where to start.

I stand here in the third reading of the Crown Minerals (Decommissioning and Other Matters) Amendment Bill. National oppose this bill. I tell you what, over the last 48 hours, I have been up here in the House a number of times on unnecessary regulations and laws and legislation. Every single thing that we’ve seen from that side of the House in the last 48 hours has been absolutely unnecessary—a burden on our businesses, bureaucracy, complication, and overreach by this Government. It continues. It’s like a machine—it just keeps pumping it out like fodder—and I’ll tell you what, Kiwis are sick of it.

Have we heard anything about the Aucklanders that are in lockdown for nearly a hundred days? Did I hear anything from that side of the House? The answer is no. They would not have a clue in terms of the pain and agony that the people of Auckland and the people of this country are falling to because of unnecessary legislation like this bill that I’m talking to right now.

I want to get into some of the detail around some of the costs and benefits, or, should I say, the lack of, because this is an example of a Government that has a complete inability in terms of targeting investment to get a payback. I’ll tell you what, there are a lot of Kiwis in this country right now who are not throwing out all their money all willy-nilly—quite the opposite. Hairdressers, salons, hospitality have had zero income for the last hundred days, but the cost-benefit of this bill is that for every $1 of spend from taxpayer money, paid out of the pockets of hard-working Kiwis, there is 11c. Well, I don’t know about the economics and understanding in terms of payback on investment, but I can tell you what, my eight-year-old son at home—he’s pretty reasonable at maths, so he would be able to work it out. He could say, “Dad, I don’t think that sounds very good.”, and you know what? He’d be absolutely right.

The problem is that that side of the House can’t seem to get it. They do not understand that that level of investment in terms of the money that is paid for out of our pockets—out of all those Kiwis—in terms of this bill is not effective spend, and we have got a heck of a number of areas within this country that need investment right now. I’m looking at the member from down in the Queenstown area, in terms of our tourism sector and the pain and agony that they’ve felt, and this bill is using that investment in a way which is wasted.

We talked a little bit about the select committee process, and I want to acknowledge the chair, Jamie Strange, across there—a good man. I always have a lot of time for him and he’s a pretty good, sensible chap. But I must say that that committee was whipped in terms of pretty much being muzzled around being able to provide any level of feedback around improving that bill.

What is the purpose of select committees? Well, I tell you what: it is to improve legislation. It is to make it better, but over the last 48 hours, like with this bill, we have not been given the opportunity to get in front and go through and do due process on legislation. That side of the House thinks it’s completely acceptable to rush through this type of legislation without due consultation, and that is an absolute disgrace.

I want to finish off this contribution in terms of what was referred to on that side as those big, bad multinationals. Well, we simply do not buy that. These entities contribute a significant amount of money in terms of our economy, and in this area alone, $2.5 billion—yeah, that is a heck of a lot of money. These guys are good at spending, but in terms of making money, I can tell you what, it’s a lot harder. Also, $750 million in terms of some of the contribution—that is a significant impact from that industry.

National supports business. National supports the people of this country. National supports sensible regulation where it’s required. We do not support this bill. National oppose this bill.

One thing I’ve learnt in life is that just because you say it louder doesn’t make it right. There’s a couple of members on that side of the House that could probably take that lesson, I think, over the last couple of days, and this particular bill is a prime example of that.

There is a particularly difficult question here around the legacy of decommissioning oil and gasfields, and I think this is pretty straightforward. If there is the possibility in the current regulations that the taxpayer and the Crown could be left with the liability and the cost of dealing with this, then that should be sorted, and this bill is doing just that.

I’m not going to pretend that I’m an expert in oil and gas—it’s not something that we deal with very often in Wairarapa. But I would think that most New Zealanders watching this, when they were made aware that there is the possibility that a company could leave what would reasonably be expected to be their responsibility on the Crown and on taxpayers, then I think that they would want that to be sorted. I think that they would expect that this Parliament, actually, when faced with this pretty straightforward proposition, would agree to close those loopholes that would allow that to happen. Even if it is a possibility that hasn’t occurred often in the past, why should we leave a loophole open for that to, potentially, be exploited in the future?

So I look at this very simply. If I was leasing a farm and I left that farm in a state at the end of that lease, it shouldn’t be on the farmer to sort it out. It should be on the person who was leasing that, and I see this as exactly the same. In normal, everyday life people would expect those that perform a particular function to deal with their responsibilities and not impose it on others. This bill is going to sort that out.

Thank you, Mr Speaker. As Richard Stark says, “the legacy left by industrial development can be riddled with uncertainty and be enduring in nature.”, and I find it alarming that the Opposition is so horrified by the idea of enduring obligations. The idea of enduring obligations isn’t a new concept. It’s fundamental to a sustainable world of tomorrow.

Historically, across the world, this seeming urgency to realise the productivity of oilfields and gasfields has meant that due weight wasn’t always given to the legacy of those works, nor the thought to who would be responsible and how, and that’s what this bill addresses. It ensures that those who undertook and profited from petroleum activities will pay a fair share for the cleaning up, the decommissioning, or any remedial work, and that it doesn’t fall fully to the Crown, to landowners, nor to taxpayers.

The changes in the bill, in terms of implementing a regulatory regime, echo the principles that we’ve seen internationally in the UN Convention on the Law of the Sea—UNCLOS—which requires the removal of abandoned installations from a State’s territorial waters. We’ve also seen it in the UK law, where decommissioning of offshore oil and gas is included in the Petroleum Act.

Here in New Zealand, the changes proposed will benefit landowners on whose land petroleum mining has taken place. It will benefit the agricultural community, who are vulnerable to hydrocarbon leakage onshore. It will benefit commercial marine users such as the commercial shipping and fisheries communities, who are vulnerable to things like snagging and fishing nets on decommissioned offshore installations left in situ. It will also, of course, benefit the public at large, including, of course, our future generations.

I thank the Economic Development, Science and Innovation Committee for their work on this bill, and I commend this bill to the House.

Thank you, Mr Speaker. I begin my contribution today opposing this bill by first of all thanking the Economic Development, Science and Innovation Committee, which I am a part of, for the work that they’ve actually done and, I have to say, particularly for the contribution of our spokesperson on this bill, Barbara Kuriger, who actually did the heavy lifting, because, as its often is with select committees, spokespeople actually sub permanent members out when they’re having to deal with it. I was often subbed out so Barbara could hear the submissions process. I appreciate all the work that she has done, and I’d like to thank her and everyone, including the committee clerks, who have actually put in a lot of hard work. Even though the committee actually disagreed, I think the process of that select committee was a good one.

I’d like to start off by commiserating with the Labour member for New Plymouth, Glen Bennett, because the contributions that I’ve heard from the Labour Government have probably nailed his chances of being re-elected in New Plymouth to zero. In terms of the way that the members have actually spoken, it is very clear that members on that side of the House do not understand how business works.

Just because they claim that National supports big business and whatever, it just goes to show that they understand nothing about business. It’s not just big business; it’s every business that we care about, including those which have actually suffered tremendously in Auckland through lockdown for more than a hundred days. When that member talks about enduring liability and responsibility, I just would like to say that the legacy that this Labour Government has left New Zealand is thousands of businesses that have had to close and the migrant population who are separated because of Government policy. So do we actually now send the Government the bill for the cost and the heartache and everything else that has actually gone wrong as a result of this Government’s policy? Maybe perhaps that’s what we should do.

But if we could talk about the details, I was actually shocked when I first heard that the costs greatly outweigh the benefits, as this proposal is estimated to cost $1 billion—$1 billion—and for every $1 spent, we will see only 11c—11c—worth of benefit. I know maths may not be the stronghold of some members, and I just want to say if Opposition members have invested in a house that is worth $1 million, if you put this mathematics—and this is cost-benefit analysis. If you spend $1 and you’ll only get 11c worth left—if they bought a house for $1 million and they decide to sell it, with this 11c worth of benefit, the house will only be worth $110,000. What kind of an idiot would make that kind of an investment—that only 11c is gained as a result of spending $1. A billion dollars is the cost to the taxpayer.

Yes, I know, there was an incident with the Tūī field and the Tamarind company that is costing the taxpayer, and that is an unfortunate incident. I know for a fact that the industry, when they submitted to the select committee, were not actually trying to obfuscate from their responsibilities; what they were actually wanting was regulation that is reasonable and is actually putting up those people who pollute to be responsible.

I think everyone can agree to that. If one pollutes, they have to pay some kind of reparation to right the wrong that the company has done. I think most people would accept that kind of responsibility if that is put in regulations for the businesses to be responsible for at the end of their term.

But what this bill does is put retrospective responsibility on the company. It’s like when someone goes into a contract, saying, “I’ve sold my house. I’ve signed a contract.”, and I’ve actually sold it, but 10 years down the track, I’m responsible for what goes wrong with that house. Does that actually happen? No, it’s been sold.

💬 Hon Members: It does.

Gosh—for something that the new owner does? This is what I’m talking about—for something that the new owner does to the house is what I’m responsible for—and that is not right. That does not happen. As I said in a previous reading of this bill, it’s like moving the goalposts after the—what do you call the person who kicks the ball? The kicker kicks the ball in a rugby game, for example, and the goalposts actually move. How do you score a try in a game of rugby if the goalposts actually move after the ball has been kicked? This is ridiculous.

The Government spends money, wastes money, on ridiculous things that are not necessary, particularly during COVID—just like the walkable Harbour Bridge, where the cycleway and the walkway along the Harbour Bridge was going to cost mega amounts of millions of dollars. They wasted so many million dollars of taxpayer money—

💬 Hon Member: $51 million.

—$51 million, that’s right—that has actually been spent. Who is going to be responsible for that? Should we be sending the Government the bill for that, because the taxpayer is paying for their mistake, just like the supposed slow tram down Dominion Road to the airport? That is never going to happen. “How much is the taxpayer going to pay for the legacy of this Labour Government?” is what I’d like to ask those members.

One of the things that I have read previously is that even the people who have submitted are, as I’ve said, supportive of responsibility being put on those people who pollute. I think the regulations need to be reasonable, and, as I said, nobody wants to be making New Zealand a dirty country. We all want to be responsible, but this particular legislation does not provide that. It actually puts a burden on people who may want to actually invest in New Zealand.

The Taranaki decision by the Prime Minister meant that thousands of jobs actually went in Taranaki, but this is like scaring future investors away for a decision that the Government is making. It also means that we, as consumers of electricity, will probably have to pay more for our power than ever before, and considering the fact that all of us who were in Auckland were spending more on power. We were using more power because we were locked up at home. We were cooking. We were turning all the lights on in the house. I mean, normally, we’re not home that often or that long during the day, but we had our computers going, so we used more electricity, and that cost is on the consumers because of this Government’s bad decision. I, together with my colleagues on this side of the House, oppose this bill.

I commend this bill to the House.

Members, this House stands adjourned until 2 p.m. on Tuesday, 7 December 2021. Pō mārie.

The House adjourned at 4.59 p.m.