Business Payment Practices Bill

Thank you, Madam Speaker. I rise on behalf of ACT to take a short call on the Business Payment Practices Bill. It will be a short call and, unlike Simon Watts, I will be unable to drag it out, because there’s really not a lot to say. [Looks around at nearby empty seats] And I haven’t got the support around me that he had, either.

I’m not sure who Minister Andersen—

Hon David Bennett: Oh, that’s a bit cutting!

CHRIS BAILLIE: —at the moment—Minister Andersen talks to, as far as business owners go. Because I talk to business owners all the time, and they’re hurting. They’re the ones that managed to survive COVID and get through and, of course, survive the Government’s attacks on them. And every business owner that I speak to knows—well, not one of them has ever mentioned late-paying invoices as being a big issue. So I’m just not sure who she actually talks to. And the fact that, as is mentioned, the same scheme in Australia, in the UK, has been tried and failed—the Ministry of Business, Innovation and Employment (MBIE) can’t find a reason for it. So, really, it’s, like was mentioned, the Plain Language Bill, the health and safety at work amendment bill—to name a few—as a solution looking for a problem. Small businesses have ways of dealing with late payments, and, generally, it’s a phone call. A phone call, it works wonders. I have to do it myself every now and then. And, either way, few businesses who have to do that are dealing with these companies that are the late payers.

The Government is tinkering around the edges. It’s trying to convince the party faithful, gullible enough to actually believe that they care about small business. And while they do that, we slowly watch them destroy them, sending good people to Australia. With the minimum wage up 44 percent, productivity up 7 percent—

Angela Roberts: Woo!

CHRIS BAILLIE: Whoever just said, “Woo!” just doesn’t understand business, because it is unsustainable. The “stat” holidays—$450 million. I hope everyone over in the opposition said thank you to all the businesses on Matariki, because it’s businesses that were able to allow that statutory holiday.

Angela Roberts: It’s good for businesses.

CHRIS BAILLIE: Anyone who says it’s good for business has never owned a business, obviously. And we’re told on Matariki that those businesses aren’t allowed to make a big profit because you’re not allowed to commercialise Matariki—unlike Easter and Easter eggs; and Christmas, we’ve got Santa. Not Matariki. So it makes it even more difficult.

We’ve got an extra sick leave, $2 billion extra sick leave to cost to businesses. And this Government thinks that late-paying invoices is the big issue. And then we’ve got the lunacy of the compulsory union awards, or fair pay agreements, that are already starting to create a headache for business owners and their staff—the business owners that treat these staff really well and the staff who don’t want a bar of these things, and they are being forced by union bullies. I won’t even start to look at this Government’s record on crime and how that affects businesses. I know of businesses in a large New Zealand town who—the owners aren’t even reporting robberies or ram raids.

ASSISTANT SPEAKER (Hon Jenny Salesa): Order! The member will come back to this bill.

CHRIS BAILLIE: Yes, Madam Speaker.

ASSISTANT SPEAKER (Hon Jenny Salesa): Thank you.

CHRIS BAILLIE: This is a cynical attempt to trick the voters, to make them think that this Government cares about small business. As the National speakers have said, it will be repealed after 14 October. And the public and business owners will know that ACT have their backs. Thank you.

E te Māngai, tēnā koe. Tēnā koutou e te Whare.

Hon David Bennett: This will be good economics.

CHLÖE SWARBRICK: I have just heard from a member of the House from the Opposition who has made a name for himself by yelling out “socialism” every opportunity that he has, who’s asked me to explain economics. Well, sir, let’s talk about economics. Let’s talk about what it is that we’re trying to achieve out of our economy, because this is actually one of my favourite yarns. It’s what is the economy and what is it that we’re trying to achieve out of the rules, the regulations, the legislation that we put in place?

ASSISTANT SPEAKER (Hon Jenny Salesa): Order! The member can have that discussion with the member of the Opposition at a different time, but come back to this bill. Thank you.

CHLÖE SWARBRICK: Thank you, Madam Speaker. It’s a shame to return to this bill, but, none the less, it is a good bill. It is a good bill—a simple bill—which interestingly enough has been the point of members of the Opposition and the ACT Party member, Chris Baillie, who just resumed his seat. It is a simple bill, because it doesn’t purport to fix all of the issues in the economy, the unfairness, the inequity, and otherwise. It is not an inherently transformational piece of legislation, but it doesn’t pretend to be that. It does what it says on the tin, which is to provide greater transparency and, therefore, some consumer choice for small businesses or small-business consumers who may be choosing who they engage in business with.

We’ve traversed this substantially at all of the other readings throughout this bill’s progression, and in the words of Jeanette Fitzsimons, “Sunlight is the best disinfectant.” And, in fact, when we have that data, that information, and those details, we can make better, informed decisions about the kind of business that we want to do in this country. As far as the Greens are concerned, that is good for the economy. So the Greens are proud to support this bill. Of course, it’s not transformative, but let’s do that in the election, hey?

Thank you, Madam Speaker. As a small-business owner for 20 years, I rise proudly to speak and support this bill. I know how important it is for small businesses to be able to be paid on time, and this will make a significant difference. I commend this bill to the House. Thank you.

This bill is as simplistic in its approach to trying to fix a problem that doesn’t exist as the speeches we’ve had from members of the Government. The reason for that is, ultimately, there are two problems. If this is such an important thing, why does this legislation not cover Government agencies and Government departments?

Angela Roberts: It does!

Hon TODD McCLAY: It doesn’t to the degree that it’s imposing a cost upon businesses within New Zealand. Because that’s the point: this will impose a cost that’s trying to solve a problem that really doesn’t exist. It’s a Government that continually stands up in public and says, “We have got the big issues at heart.” This has nothing to do with bread and butter.

Here’s the worst part; the second problem of this. This House, when it goes into urgency, should be dealing with issues that are urgent to New Zealanders. Six years after this crowd came to Government, they’re coming here to pass this piece of legislation because they say it is one of the most urgent things they have to do in the last few weeks of this Parliament and here’s here.

Now, there are problems, actually, with people not paying their bills in New Zealand—no question about that. If this legislation had been amended earlier in the committee or in the committee of the whole House stage to deal with New Zealanders that can’t pay their bills, I don’t know. For instance, the rents that have gone up so much, or their food in supermarkets that costs so very, very much. It would be a worthwhile use of Parliament’s time anyway, particularly in urgency. But in this case, it doesn’t deal with those things at all.

All it does is look for a problem. It’s a solution that’s looking for a problem, and we’ve heard from so many speakers in the debate so far that actually, while submitters came forward and said if there is an issue, there are better ways to deal with it, once again, we have a Government that doesn’t listen to New Zealanders, doesn’t listen to experts, and puts its head down and says, “We know best.”

Well, it feels to me that, actually, when Governments run out of things to do that are important—they run out of ideas—they start coming up with solutions to problems that don’t exist, and they try to justify that speech after speech. Now, if this was important legislation—if it was fixing great challenges, if actually there was a real solution in this to a real problem that everyday New Zealanders were facing—then those members wouldn’t be taking a minute or two in their 10-minute speeches to rush this through; they would be explaining it to New Zealanders, justifying it, making the case—80 days, plus or minus, out from election—of why this is important, why it’s in the House now, why it’s in urgency, and why they should be voted back in as a result of that. But we’re not hearing that. We’re hearing the Opposition members turning up and taking full calls, talking about what the real problems are and what the solutions should be.

The waste of money that comes about as a result of this; significant waste of money. Because when you look at it and it says it appoints people to look into this and to report to the Government, it’s another cost, if not upon business, upon the taxpayer, because of more Government resource that’s going after bad problems and not solving solutions. It is deeply, deeply disappointing that when, if there are issues in public where we have people, businesses, that struggle because of late payments, that, actually, this will do next to nothing to help them.

This was canvassed in the first reading, it was presented by many submissions in the committee, and it’s been raised again and again and again in this House. To be using Parliament’s time in urgency for this, again—rather than the many, many urgent issues that exist in New Zealand today—is not only a travesty, it does a great injustice to New Zealanders who have faith in this Government and this Parliament to actually deliver on the things that are important, and this is a clear issue where it won’t.

Businesses earning more than $33 million of revenue, or $10 million in third-party expenditure, for two or more consecutive accounting periods must disclose their payments. Well, it doesn’t actually do anything about it rather than a cost and another disclosure. We’ve had so many pieces of legislation that say, on the one hand, we’re going to stop measuring the things that are important to New Zealanders—like, I don’t know, what’s happening in A & E or emergency departments, or whether or not a hospital is delivering, or whether or not kids really can learn to read and write. We don’t want to measure that as a Government in case somebody holds us to account, but we’re happy to impose costs upon businesses in New Zealand so that they must measure and they must report so that we can have a look, and if there is a problem, maybe one day come back and pass another piece of legislation that actually won’t make a little bit of difference for the lives of any New Zealanders.

This is a Government that wilfully has borrowed, we are told, and spent—run up our debt to almost $97 billion. The taxpayer is going to have to work hard to find ways to pay that back. But that’s not good enough for this Government, not just borrowing taxpayer money and spending it and running up debt; they now want to impose costs upon businesses at a time when, actually, we should be helping those businesses—

Order! The member’s time is up.

Thank you, Madam Speaker. It’s a pleasure to rise and take a call on this bill. It’s really disappointing—so many of us have been involved with small businesses throughout our lives and we know the impact, the precarious nature, the constant conversation about cash flow. It’s really disappointing to hear, time and time again, how out of touch the other side of the House is, when they constantly say that the problem doesn’t exist and it’s not important. It’s not this Government that decided that; it is in response to 2019—the Small Business Council saying that of issues facing small businesses, timely payment was a top priority. It is really disappointing to hear, time and time again, how out of touch the Opposition is.

What we are doing is ensuring some transparency, and those who believe in the market know that perfect information is something that is required, all right? We back you, small businesses. This Government delivers for small businesses. We aren’t out of touch. I commend this bill to the House.

Members, the time has come for me to leave the Chair. The House is suspended until 7 p.m. I repeat, 7 p.m., not 7.30, when I resume the Chair. Ka kite anō.

Sitting suspended from 6 p.m. to 7 p.m.

The House is resumed. Members, when the House broke for the dinner break, we were considering the third reading of the Business Payment Practices Bill.

Thank you, Madam Speaker. Thank you for the opportunity to stand and talk on this very important bill, which is before the House. It’s great that it’s come to the third reading and great that we’ve been able to shepherd it through. Thank you to everybody that’s put in a lot of time and a lot of effort to get to this point.

This is all about making sure that small businesses know good players to play with. We are doing something that is going to make sure that we’re improving that information, that transparency around business-to-business practices here in New Zealand, to make sure that things are done in a good old, fair dinkum, Kiwi kind of way. For that reason, we on this side of the House are completely supportive of it. We know the benefits that it’s going to bring to those people that are in business, especially the small businesses. And if there’s something that we’ve learnt during COVID-19, it’s that actually we have a lot of small businesses here in New Zealand. Ninety seven percent of the country are made up of small businesses, and we need to do everything that we can to ensure that small-business owners have absolute confidence about who they are interacting with, who they’re transacting with, and making sure that they are in the best possible position to be able to contribute to the economy. When we support them, they support other New Zealanders and the whole economy works. For that reason. I support it to the House.

I call—

Andrew Bayly: Andrew Bayly.

ASSISTANT SPEAKER (Hon Jacqui Dean): Andrew Bayly. Apologies, Andrew; I do know you perfectly well.

That’s all right, Madam Speaker. I know. We’ve just had a nice dinner—

Glen Bennett: Unforgettable [sings].

ANDREW BAYLY: —together. Ha, ha! This is one of these bills that the Minister is rapidly trying to get through the House before the end of this session. Actually, it’s five weeks and one day before this House comes to a close. And this is one of those bills that a Minister wants to be able to stand up and say, “I did it, I did it, I did it. Well, I did it.” Even though we know that it’s absolutely a waste of time, because when we sat in the room and listened to all the submissions, even the officials have acknowledged they do not know the scale of the problem; they have not been able to quantify it. But, hey, this is one for the Minister to talk up. I think it’s probably the only thing that this Minister for Small Business has actually done for small business, and what a catalogue of issues and impositions they have placed on small businesses over the last few years.

At the very same dinner that the Speaker and I have just attended, I just listened to a very well-known business owner, promoter, and founder of a large company talk about the misery of being a businessman in New Zealand at the moment, where there’s an avalanche of regulation that has come on. And, of course, this is just another example of that. But, of course, you know, if you’re a small-business owner in New Zealand, you’ve had the issue about lack of talent: you can’t get people; you’ve had an unsupportive Government who’ve locked people out of the country and don’t happen to allow immigration; they are taking apart the vocational training organisations in New Zealand. So we’ve had that. We’ve had all their imposition of costs, because this Government only sees small businesses as a cash cow to fund their whole range of useless projects in the main. We’ve seen all of the issues around how to actually just ruin the lives of mums and dads who mostly run and own these businesses alongside their employees. We’ve seen how more difficult it is to employ people, and we’ve seen the rapid escalation of costs imposed on them. And many of them are now at a stage that they are up to here, and let’s hope there is a change in October, because there will be many small businesses—as this owner just pointed out at the dinner—who are now contemplating selling their businesses because of the environment that the Labour Government has imposed over the last six years.

Now, we oppose this bill and quite rightly so, because there is no requirement for this bill. And the prime reason for this is that there are four independent, highly credible credit-assessment companies in New Zealand who you can go to today and get, in real time, the same data that this so-called piece of legislation will enact, and for a sheer cost of $33 per application. For 33 bucks, you can go to one of the four and say, “I’d like to know about the credit assessment of X, Y, Z Ltd.” And, of course, what that will mean is that not only will you get the most up-to-date real-time data—not like this that potentially could be six months out of date—but, secondly, you get a much more enriched form of data about that firm. You can actually ask for even more than just how often they pay. You can ask them a lot more about the nature of the operations, what they do, who the creditors are, who the debtors are, who the directors are—all that sort of information.

But this is a Government that does not understand business. And this is going to be run by the Ministry of Business, Innovation and Employment (MBIE). They’ve told us that they are looking at going out and employing a whole lot of IT consultants at a cost of between, we think—the estimate I asked of some of the credit-assessment agencies who are really in the market: “What would it cost MBIE to set up a package like this? What would it cost them to set up an IT programme like this?” And they estimate between $3 million to $5 million. And, of course, the Government has a wonderful opportunity and a wonderful experience in terms of delivering projects that will enable this to take place. And, of course, then there’s the operating costs if MBIE were to run this programme to deliver on the impact of this bill. And that, again, is estimated well into the millions.

And this is just a recipe. As this bill goes through—and it looks like the Labour Government’s going to shove it through—if that goes through, they should have picked up on my Supplementary Order Paper, which said it should be up for a formal review within two years. This is something we will do because ultimately we think, if you need to find out about a firm and if you need to make a credit assessment, go and get the independent assessment for $33 because that’s a much better outcome than what this bill delivers. And the whole thing about this bill really is this issue around trying to solve this issue. And, of course, Australia and the UK have got it. I spoke to the Australians about this bill and what they’ve done. They had a similar arrangement back in 2020. No doubt that’s where the Labour Minister—the previous one—sort of got the bright idea to do this. And, of course, the Australians are reviewing that right now—right now—because what they found in some of the sectors, even though they’ve had this in operation for two years, is that the companies were actually paying slower than before they started this process.

So this is the model that the Labour Government thinks “Oh, look, I’ll pick this up and put this into New Zealand.” And, by the way, even if they do it, which they seem like they’re going to do, what about the cost on business? We talked about this cost, and it’s between $1,000 to maybe $3,000. And, of course, they’re required to do that every six months. So all we’ve done is burden these people even more. And, of course, then we’ve got the issue of fines and all that sort of stuff on the directors. It is just a cascade of more regulation on our small businesses.

Labour should learn from its mistakes. Do not keep imposing regulations on small business. Let them thrive, because when they thrive they go out, they expand, they employ more people, and ultimately—Labour should work this out—they are more profitable, and that means there’s more money for the Government. But for some reason, let’s sock it to them, let’s regulate, let’s make the environment much harder, and let’s hope—oh, don’t worry about the growth in the tax revenue; we’ll just take the money off them anyway. And that is why this Government has failed so appallingly with small-business owners in New Zealand. That’s why small-business owners in the main will never vote for Labour again, because of—I don’t know what it is with Labour—this just unrelenting desire to take money off them and see them as a cash cow. They are not. They are the fundamental plank, the fundamental benchmark, the platform, for the economy in New Zealand. That’s what it’s about. But don’t worry about it; Labour knows best! That is why this is such a bad piece of legislation, and I am so concerned for New Zealand. I am concerned that we are going to see many people just say, “This is too difficult for us.”

Joseph Mooney: Yeah, they already are.

ANDREW BAYLY: They are already saying it. And so I think, for us, if we were to win the election, the biggest thing is we’ve got to provide small-business owners with the confidence and the understanding that they are important and they are to be valued, and not only them as owners but also their staff and their members. And remember just who provides the money to them: their customers—their customers. And that is what we will have to do. And this bill does not do that. This bill is a continual assault on the hard-working New Zealanders, hard-working families that own our businesses. I feel so, so concerned about the fabric of our business community in New Zealand that I am just worried that they are going to lose hope. But I’m saying to you, do not lose hope, because we will support you, we will look after you, we will help you grow, because we want you to grow. We want New Zealand to be successful, because when New Zealand’s successful, everyone succeeds. And that is what we need to achieve in New Zealand. And that is not what has occurred under this Labour Government for the past six years.

I’ve got news for Andrew Bayly, the member who just resumed his seat, this bill applies to large businesses, not small businesses. The businesses required to comply with this bill are those that have $33 million in revenue—more than—and $10 million in third-party expenditure. That’s not a small business. Small businesses have told us that one of the critical things for them is knowing that they’re going to be paid on time.

Dr Tracey McLellan: Read the bill.

RACHEL BOYACK: Exactly—read the bill. The other side should do that. One of the critical things for a small business is cash flow. While small businesses, of course, look at income and expenditure on an annual basis—on a regular basis—if they’re running their businesses well, I’m sure they are, but what is critical is cash flow, knowing that the goods and services that they are providing that cost them money to both produce and to provide, that that money is coming back to them as soon as possible. And we know, and certainly I know in my electorate, of the odd large business that doesn’t pay on time. And I know of small businesses—

Todd Muller: Dear oh dear.

RACHEL BOYACK: Don’t “dear oh dear” me, because small businesses in my electorate have told me—and if you are suggesting that I’m somehow making that up, I’ll tell you that small businesses of the Nelson electorate have told me that there are times they don’t get paid. They’re not lying to me.

It’s an excellent bill. It’s about cash flow to ensure that our small businesses can continue to thrive and I commend it to the House.