Questions and Answers – Feb 17

Press Release – Office of the Clerk

1. ANDREW LITTLE (Leader of the Opposition) to the Prime Minister : Does he stand by his statement in relation to the comparative rise in house prices and student loans that I dont know, but I suspect its a terrible amount?
Questions to Ministers

Prime Minister—House Prices and Student Loans

1. ANDREW LITTLE (Leader of the Opposition) to the Prime Minister: Does he stand by his statement in relation to the comparative rise in house prices and student loans that “I don’t know, but I suspect it’s a terrible amount”?

Rt Hon JOHN KEY (Prime Minister): Yes, in the context it was made.

Andrew Little: Is he aware that both student loans and house prices have risen faster than the wages of young people?

Rt Hon JOHN KEY: They certainly did under a Labour Government, when house prices doubled, but under National the median house price has risen 33 percent over—

Kris Faafoi: 7 long years.

Rt Hon JOHN KEY: —in a bit over 7 years, and the average wage has risen 30.5 percent. So they are pretty much the same.

Andrew Little: I seek leave to table official statistics showing that student loans have risen by 26 percent, house prices—

Mr SPEAKER: Order! I just want to check: is the member simply seeking to table figures that are published on a regular basis by Statistics New Zealand?

Andrew Little: There are a number of sources: the Student Loan Scheme Annual Report, the Real Estate Institute of New Zealand, and Statistics New Zealand.

Mr SPEAKER: I think it is a very marginal call, but I will put the leave and the House can determine it. Leave is sought to table those particular figures. Is there any objection? There is objection.

Andrew Little: In light of the Prime Minister’s previous answer, how are young people meant to save for a deposit when student debt is rising faster than their wages?

Rt Hon JOHN KEY: I am glad the member asked that question, because under National’s KiwiSaver HomeStart programme they can get nearly $50,000, actually. That has been tremendously popular. The other thing that is worth noting is that if one looks, in the 7 and a bit years that National has been in Government median house prices have risen 33 percent, as compared with under a Labour Government—the last one—where those prices nearly doubled.

Andrew Little: Is it acceptable to him that since National introduced the student loan scheme the homeownership rate for adults under 40 has gone from over 50 percent to now just one in four?

Rt Hon JOHN KEY: Those statistics have been there for quite some time. What we do know about student loans is that they allow people to access tertiary qualifications that allow them to earn a great deal more. From what I can see from Labour’s trumped-up policy it announced on a Sunday afternoon—which is getting no traction so they keep coming to the House with it; as opposed to the Trans-Pacific Partnership, which was apparently the big issue—you are not looking at getting rid of student loans. And, by the way, if you are laughing, go and have a look at the column inches and see how many you have got: zero. [Interruption]

Mr SPEAKER: Order! A little less interjection from both sides of the House.

Andrew Little: Given that he is now such a fan of Labour’s interest-free student loan policy, can he name a former finance spokesperson who in this House once described it as expensive and irresponsible? I will give him a clue: the initials are JK.

Rt Hon JOHN KEY: That may prove to have been correct, actually. It is an expensive policy, and that is the point, is it not—that, actually, in New Zealand we are the only country in the world that has zero percent loans for people studying for tertiary qualifications, and about 70 to 80 percent of what is currently subsidised is paid for by the taxpayers. I personally think that setting is in about the right place.

Andrew Little: Does he see any link whatsoever between the $15 billion of study debt young people now owe and the fact that three-quarters of them now cannot afford to buy their own home? Is there any link at all?

Rt Hon JOHN KEY: I would have to see where those dodgy statistics come from. [Interruption]

Mr SPEAKER: Order! A little less interjection please.

Andrew Little: Does he agree that falling homeownership is even a problem, and why will he not follow Labour’s lead and have an affordable housing programme and make it easier for young people to save for a deposit by removing student debt?

Rt Hon JOHN KEY: There has been a world-wide trend of reduction in homeownership rates, and that has been happening in New Zealand over the course of the last 30 or 40 years. But that is why under a National-led Government we have the KiwiSaver HomeStart programme and why it is so popular.

Andrew Little: Why is his Government’s policy to saddle young people with debt, knowing that it takes years to pay it off and it affects their ability to start a family, buy their own home, and to live the Kiwi Dream?

Rt Hon JOHN KEY: Under Labour’s policy, from what I can see, students will still have debt. In fact, actually, some students, if they live away from home, and even if they are going to a course that has no fees charged for it, will still have debt that is incurred for an asset they will not even have because it will be some part-time course they have not completed. In the end, actually, the system is working pretty well.

Hon Member: What are you doing about it?

Rt Hon JOHN KEY: I will tell you what we are doing about it. Wages are going up faster than inflation. The unemployment rate is falling. The economy is rising up the OECD. The country is getting better connected with the rest of the world—[Interruption]

Mr SPEAKER: Order! The answer is now too long—I admit, I do acknowledge, responding to an interjection.

Economic Programme—Support for Vulnerable New Zealanders

2. DAVID BENNETT (National—Hamilton East) to the Minister of Finance: What steps is the Government taking to support vulnerable households and families?

Hon BILL ENGLISH (Minister of Finance): The Government is focused on reducing long-term dependency on public services by getting better results for vulnerable households and families, and we are seeing results. For example, the Government delivered a $790 million child hardship package—part of last year’s Budget—which raised benefit rates for families with children by $25 a week from 1 April this year, the first increase above inflation since 1972. The Government lifted student allowances for families with children, and it increased childcare assistance rates for low-income families, targeting 160,000 families, with 300,000 children. That is in addition to measures taken in Budget 2014, which delivered a $500 million package covering paid parental leave, extended parental tax credits, children’s teams, and additional support for early childhood.

David Bennett: How is the Government helping to ensure that the benefits of a growing economy are being shared by vulnerable families?

Hon BILL ENGLISH: The rising tide lifts all boats. The economy is growing. We are one of the few developed countries with sustainable economic growth, and that is flowing through to our families. In Budget 2015 we increased obligations for those on a benefit to be available for work and increased the support for parents finding work. In addition, the Government has extended free GP visits to under 13s, breakfast in all schools that want it, social workers in all low-decile primary skills, and has raised the minimum wage every year since 2008.

Jacinda Ardern: Was the Children’s Commissioner wrong when he stated this morning that “we don’t have a plan for poverty, we don’t have targets for poverty. It’s much bigger than getting people off benefits when the minimum wages is $15 an hour.”?

Hon BILL ENGLISH: We actually do disagree with the Children’s Commissioner on that matter. The Government has a broad-ranging programme, including lifting the lowest incomes in New Zealand—the incomes Labour did not lift in 9 years of reasonable economic growth—through to long-term changes in Government services, which, when run badly, create dependency rather than reduce it.

David Bennett: How are the Government’s Better Public Services targets increasing transparency and accountability to deliver better results for New Zealanders?

Hon BILL ENGLISH: The Better Public Services targets are unique because no previous Government has published indicators of our social sustainability in the way that this Government has, and then reported against them regularly. Our Government has confidence in the integrity of this process. Statistics New Zealand provides advice to agencies to ensure that the data is robust. Many of the Better Public Services measures incorporate or, in fact, are tier-one official statistics, which are the most important and rigorous statistics, overseen by the standards set by Statistics New Zealand. We welcome independent external scrutiny, such as that in the Salvation Army report, which I would say is way ahead of the scrutiny that has been applied by the Labour Party.

David Bennett: What recent reports has he received showing progress across a range of social indicators under the Government?

Hon BILL ENGLISH: The most recent one is the Salvation Army report released earlier today, which shows good progress across many but not all of the results. The number of children living on benefits has fallen by 24 percent to the lowest level since 1998; the number of children facing material hardship has fallen by 11 percent on one measure and 31 percent on another; substantiated abuse, including emotional abuse, has fallen by 26 percent; the number of working-age benefits paid has fallen by 15 percent; infant mortality is down by 22 percent; and pregnancy among 15 to 19-year-olds is down by 36 percent. That is according to the Salvation Army report.

Metiria Turei: Tēnā koe, Mr Speaker. Tēnā koutou, et te Whare. How many of the children whose parents and caregivers have moved off benefits under his Better Public Services targets are still living in poverty?

Hon BILL ENGLISH: That would depend, of course, on what measure, out of the many, the member uses to measure the income or the hardship status of those children. The Government tends to use a range of measures, one of which is the children in hardship measure, and I could go and find out for the member. But, generally, for families, one of the best things a parent can do to move their child out of hardship is to get work. [Interruption]

Mr SPEAKER: Order! The level of those sorts of interjections coming from my left-hand side has to settle down.

Metiria Turei: Does he agree with the Salvation Army report’s critique—he just referred to that report—that the Better Public Services targets are being used by Government “in a less than straightforward and reliable manner”, which risks poverty-related policies being “fundamentally misconceived”?

Hon BILL ENGLISH: No, I do not agree with that assertion. In fact, that is not borne out by the report. The report refers to two particular numbers where the Salvation Army raises questions. They are legitimate questions; they are questions we would want to see answered. We encourage independent scrutiny of all the numbers. In fact, the Government will tomorrow be releasing even more data, to make it available to people like those in the Salvation Army precisely so that they can monitor how the Government uses the information, bearing in mind that no measurement system is perfect. These are proxies for what we are trying to achieve, and that is improved welfare for our most challenged, most vulnerable families. The Salvation Army report shows, overall, some progress in that respect.

Metiria Turei: How does the Minister then explain the fact that the number of children—[Interruption]

Mr SPEAKER: Order! The same ruling I have just given to the left-hand side applies to Mr Brownlee. I cannot hear the supplementary question when there is an interchange going across the two sides of the Chamber. If Mr Robertson and Mr Brownlee want to have a discussion, they are welcome to leave and have it in the lobby.

Metiria Turei: How does the Minister then explain the fact that the number of children living in benefit-dependent homes is decreasing, but the number of children living in poverty—under those measures—is the same?

Hon BILL ENGLISH: Again, you would have to look at the particular measure the member is applying, and I am happy to do that, if she can tell us what measure that is. But, in general, families are better off in work, not just because of the income but because of the greater social cohesion that comes with being able to realise some aspiration, having connections in a workplace, and building a bit of a community and some order into families who, on benefit, often lack direction and structure in their lives. So we will continue to pursue the policy of encouraging and supporting people getting off benefit and into work.

Finance, Minister—Salvation Army Report

3. DARROCH BALL (NZ First) to the Minister of Finance: In light of the publication of the Salvation Army report, “Moving Targets”, does he stand by all his statements?

Hon BILL ENGLISH (Minister of Finance): Yes, in particular any number of statements to the effect that the Government is making progress on dealing with some of the more challenging issues among our vulnerable and lowest-income New Zealanders. The Salvation Army report, by and large—in fact, almost without exception—backs up those statements.

Darroch Ball: Does he stand by his statement, when asked about the New Zealand First member’s bill requesting that the Office of the Auditor-General review the Better Public Services targets, that “We do better than that; we get them scrutinised by the New Zealand public.”?

Hon BILL ENGLISH: Yes. Anyone is welcome to scrutinise the numbers and how they are calculated. It happens that the Auditor-General and the Audit Office do have a look at them, and central agencies do. We are actively encouraging external organisations. In fact, I think the social sector has taken a bit long to organise itself in a way that means it can apply some real expertise to holding the Government to account. We would welcome that.

Darroch Ball: If that is the case, does he agree with the Salvation Army’s Alan Johnson that Better Public Services targets should be debated publicly, given that it is already critically examining the “often flimsy information offered by officials … [on] accuracy of data.”?

Hon BILL ENGLISH: Yes, and I am pleased to see the Salvation Army actually doing it. It is creating a public debate about the numbers, and, probably, some people who are listening to that debate will be surprised at how much progress is being made on some of our core long-term issues. With regard to flimsy data, yes, there are a lot of areas where the data is flimsy, because in the past Government has not bothered much about whether it is making a difference to people’s lives. We are trying to find out whether we are, and are quite willing to be held to account where we are not making enough difference.

Darroch Ball: How can the public have confidence in the target results, when trusted organisations like the Salvation Army are now saying: “Some Government agencies appear to be using targets and the numbers behind them in a less than straightforward and reliable manner.”, and “changing the definitions behind indicators, so results appear better, to inventing new numbers.”?

Hon BILL ENGLISH: As I think I have said before, I think the Salvation Army is overstating a couple of concerns it has about two particular measures. Any of these numbers that are used are open to debate about exactly how they are calculated and used—and we are quite happy to have that debate. In fact, I think we have been trying to contact the Salvation Army, because when you look in its document, it is hard to see just what the problem is that it is referring to. But the public can have confidence because this is the first Government ever to publish this sort of data and report against it, and to welcome debate about the performance in changing people’s lives.

Darroch Ball: Does he agree with the Salvation Army’s Alan Johnson, when he says public scrutiny and analysis undertaken by Treasury is “not the same thing as tangible results, verified by a party that does not have a vested interest in reporting good news stories.”?

Hon BILL ENGLISH: Well, of course the Salvation Army is an independent entity, which has the intelligence and capacity to look at the data, actually verifying tangible progress. I mean, if there are 24 percent fewer children on benefit, we regard it as progress. They have looked at the information, which is Department of Statistics information, and they are saying that it is progress. I would hope that more organisations will do what the Salvation Army has done, because that can only improve the performance of Government in changing lives.

Darroch Ball: Will he back New Zealand First’s member’s bill that calls for an independent audit of the Better Public Services targets by the Office of the Auditor-General, this now being the third time in the last year that we have asked the Government to do so?

Hon BILL ENGLISH: No, because there is no need for it. The Salvation Army is conducting an independent audit, it has raised two issues out of hundreds of statistics, and we are quite happy to look at them. It is free to get the experts from all the universities in New Zealand to come in and pore over every detail in it. We welcome that kind of public scrutiny, because it will make us better at changing the lives of the most vulnerable.

Darroch Ball: I seek leave to introduce the Better Public Service Target Results Independent Audit Bill, which ensures that all Government Better Public—

Mr SPEAKER: Order! The motion has been moved. I will put the leave as sought for that course of action. Is there any objection? There is.

Transport Infrastructure—Accelerated Regional Roading Programme

4. JONATHAN YOUNG (National—New Plymouth) to the Minister of Transport: What recent announcements has the Government made on progress with the Accelerated Regional Roading Programme?

Hon SIMON BRIDGES (Minister of Transport): The Prime Minister recently announced up to $115 million of funding for regionally significant roading projects in Taranaki, Gisborne, and Marlborough. Two of the projects are newly identified and on State Highway 3 in north Taranaki, which connects with the Waikato. Up to $90 million will be spent building a bypass at Mount Messenger, while up to $15 million will be spent on building a bypass of the Awakino Gorge tunnel. Supporting Taranaki’s growth is a real priority for the Government. That is why the bypasses, along with other planned safety improvements to the tune of $25 million to $30 million will ensure this important stretch of road is safer, more reliable to travel on, and supports the ongoing economic growth of this region.

Phil Twyford: What about Northland?

Hon SIMON BRIDGES: Ask your supplementary question.

Jonathan Young: What other projects has the Government announced to support regional roading priorities in Marlborough and on the East Coast?

Hon SIMON BRIDGES: There is a lot of interest in this and there is a lot of good news from the regions. The existing Ōpawa Bridge on State Highway 1 in Marlborough is an important gateway to Blenheim but can be prone to real delays. That is why the Government is stepping in and spending up to $17.5 million on a new bridge. It will be wider and see traffic flow more freely, resulting in fewer delays and road closures. We are also spending up to $5 million to replace the Mōtū Bridge on the East Coast, which is the only one-lane bridge on the stretch of road between Gisborne and Ōpōtiki. The new Mōtū Bridge will strengthen the East Coast’s main link with the Bay of Plenty and help boost the region’s economic growth and productivity.

Jonathan Young: What reports has he seen on the Government’s recent announcement that it will fund up to $115 million of funding for regionally significant roading projects in Taranaki, Gisborne, and Marlborough?

Hon SIMON BRIDGES: Oh well, the Prime Minister’s speech has been widely applauded in the regions. For example, I have seen a media statement from the Taranaki Regional Council—

Hon Member: Ha, ha!

Hon SIMON BRIDGES: —which the member opposite for some reason laughs about, saying that this is the best single decision in several decades for our road network and the economic activity that relies on it. We have been pushing hard for improvements and our expectations are high but today’s announcement exceeded them. The Minister and local MPs deserve our thanks. We are a Government that is putting its money where its mouth is and getting on with supporting regional New Zealand. [Interruption] Ask a supplementary question.

Pita Paraone: Tēnā koe. Supplementary question to the Minister and thank you for the announcements—

Mr SPEAKER: Order! Can I just have the supplementary question.

Pita Paraone: Can I ask the Minister when he will be announcing the allocation for roading in Northland?

Hon SIMON BRIDGES: I thank the member for the acknowledgment of the great work that we are doing. It may have escaped his attention—I appreciate he is a busy member—but we are spending many, many millions of dollars in that important region and indeed the procurement on a billion dollar piece of highway is going on as we speak, not to mention the bridges and the other roading improvements. I think—[Interruption]

Mr SPEAKER: Order! The question was asked by New Zealand First but with the level of that interjection they clearly not that interested in the answer.

Government Financial Position—Dairy Prices

5. GRANT ROBERTSON (Labour—Wellington Central) to the Minister of Finance: What price per tonne of whole-milk powder in the Global Dairy Trade auction has been factored into the calculation that there is now a $17 billion shortfall from Budget 2015, and if this was not done, what calculation was used to model the effect of “weaker dairy prices”?

Hon BILL ENGLISH (Minister of Finance): Treasury does not forecast specific dairy product prices or results from the Global Dairy Trade auction—if only because it is in US dollars. Instead, Treasury uses an index of New Zealand dairy export prices based on past experience. Between the Budget and the Half Year Economic and Fiscal Update, Treasury lowered its dairy price forecast over the period through to June 2017 by between 15 and 20 percent—that is, between the Budget and the half-year update. In total, between the Budget forecast and the half-year forecast nominal dairy exports were lowered by a cumulative $1.3 billion over 5 years to June 2019. Most but not all of the recent price reductions had been incorporated into Treasury’s latest forecasts, but we are likely to see further reductions when Treasury revises its forecast for Budget 2016.

Grant Robertson: In light of the further decline in global dairy prices since the half-yearly update and the resulting further decline in revenue, will he confirm that the $17 billion hole in his Budget just got bigger?

Hon BILL ENGLISH: No, actually, because the $17 billion was the reduction in total GDP over 4 years in the half-year update. But of course alongside reductions in dairy prices we are seeing stronger immigration, lower unemployment—

Hon Nathan Guy: Tourism.

Hon BILL ENGLISH:—stronger tourism, and other prices that are higher than expected, so we will just have to wait and see. But it could well be that there is no further reduction, or it could be that any reduction is driven by, for instance, lower oil prices and lower inflation rather than lower dairy prices.

Grant Robertson: If dairy is now of such diminished importance, why was it the only sector specifically named in the Prime Minister’s statement in reference to the $17 billion hole in the Budget forecast?

Hon BILL ENGLISH: Probably because at the time that that $17 billion was removed from the GDP forecast over the next 4 years, it was probably the single biggest driver. In the next forecast it may not be the single biggest driver. It has already fallen quite some way and, as I have pointed out, there are other parts of the economy going very well, in particular tourism and the export of services, which is as big as the dairy industry. In fact, through this year it may pass it in size.

Grant Robertson: Has he sought assurances from banks in New Zealand about their approach to New Zealand dairy debt in light of projections of a third year below break-even payout and Federated Farmers saying one in 10 farmers are facing pressure from their bank?

Hon BILL ENGLISH: In ongoing discussions with the banks, myself, the Minister for Primary Industries, the Reserve Bank, and Treasury—I think we need to keep in mind here that although prices have dropped further, and look like they will stay low longer than was expected, this is an industry that has a very positive long-term view about its prospects, which is reflected, for instance, in the current land prices, and it also has pretty solid balance sheets that can absorb losses—hopefully, not for 3 years but certainly for 2 years. There will be some farmers with very high debt levels who will be under pressure, unsurprisingly, from their banks.

Grant Robertson: Why have he and the Prime Minister insisted for month after month that dairy prices will come back very soon, when they were warned in July 2014 that there was a 5-year oversupply of milk in the global market?

Hon BILL ENGLISH: The best response to that, I think, is what was published in Treasury’s forecast, which accounted for a significant drop in dairy prices. In retrospect, there are all sorts of experts—in fact, that is the only way the member seems to be able to demonstrate his expertise. Dairy prices are down—that is one factor of the global economy affecting New Zealand. There are others that are positive, and fortunately, we are one of the few developed countries with the prospect of steady, moderate growth over the next 2 or 3 years, despite lower dairy prices.

Richard Prosser: What is his Government’s tangible financial plan right now to help farming families struggling with bank debts and the prospect of being thrown off the land, rising farmer suicides—including those found hanging by Fonterra tanker drivers and those who phone our offices in tears talking about suicide—falling returns, and the $167 billion in subsidies paid to their competitors in the US, Europe, and Japan, which have just been enshrined by the Trans-Pacific Partnership agreement?

Hon Gerry Brownlee: What a load of nonsense.

Hon BILL ENGLISH: Well, that dignifies it. For those farmers in extreme circumstances, there are, of course, the various rural-based organisations around the country who are well organised and very attuned—

Hon Nathan Guy: The rural support trusts.

Hon BILL ENGLISH: —the rural support trusts—to the ongoing mood in the farming community. But the Government does not intend to initiate financial support for dairy farmers under pressure.

Child Health Services—Free General Practitioner Visits for Children Under 13

6. SIMON O’CONNOR (National—Tāmaki) to the Minister of Health: Can he confirm that since the launch of free doctors’ visits for children under 13, rates of children under 13 visiting their GP is 23 percent higher than the same quarter last year?

Hon Dr JONATHAN COLEMAN (Minister of Health): Yes. The Government is committed to supporting families by giving children the best possible start in life. That is why this Government committed $90 million over 3 years to extend the free GP visits and prescriptions to children under 13. Removing this cost barrier is making a real difference to many families and is supported by the extra $400 million being invested in the health sector this year.

Simon O’Connor: How do these rates compare for Māori and Pacific people?

Hon Dr JONATHAN COLEMAN: The data also shows that more Māori and Pasifika children are being seen by their GP. There was a 25 percent increase for Māori and a 21 percent increase for Pasifika children. That means children are seeing a health professional earlier, taking pressure off emergency departments in hospitals and, most important, kids are prevented from getting sicker.

Simon O’Connor: How many practices have opted in and how many children are benefiting from free under-13s GP visits?

Hon Dr JONATHAN COLEMAN: I am pleased to report that 99 percent of general practices across the country are now offering free GP visits for children under 13. That means that 780,000 children under 13 can benefit from free GP visits and prescriptions. Just 10 general practices out of 1,015 have not signed up, and in all cases there are easily accessible alternatives.

Barbara Stewart: Can the Minister confirm that, unlike New Zealand First’s free doctors visits for under-13s policy, his policy does not cover casual visits for under-13s and that after-hours surgeries and emergency departments are under increased pressure because families are waiting to seek medical assistance when it will be free?

Hon Dr JONATHAN COLEMAN: I do not know what the New Zealand First policy covers, but I have been very clear about our policy.

Social Development—Salvation Army Report

7. CARMEL SEPULONI (Labour—Kelston) to the Minister for Social Development: Why is the Government, according to the Salvation Army, “inventing new numbers like pseudo-service-level indicators that are difficult to verify and have no point of reference”; is it to hide the true state of poverty in New Zealand?

Hon ANNE TOLLEY (Minister for Social Development): I fully reject the member’s assertion. The Salvation Army report does not question how poverty numbers are measured. The Ministry of Social Development regularly puts out the household incomes report, which looks at a large number of measures around hardship and poverty in New Zealand, and the Salvation Army report makes a fair and reasonable use of this ministry data. To say that this Government is deliberately inventing numbers is ludicrous, and the member should read more than just the first page of the Salvation Army report.

Carmel Sepuloni: Does she agree that “government agencies appear to be using targets, and the numbers behind them, in a ‘less than straightforward manner’ ”, and is this not just another example of her department being disingenuous?

Hon ANNE TOLLEY: No, I reject that assertion too, and I think the Minister of Finance has already addressed it. Many of the statistics used and quoted in the report are actually tier one statistics from Child, Youth and Family statistics that are used in the report. Actually, the Audit Office does have a look at those statistics, and if it had any concerns, I have no doubt it would have raised them when it came to the select committee.

Carmel Sepuloni: When will she stop her officials “changing definitions behind indicators so results appear better”, a practice confirmed in the Salvation Army reports?

Hon ANNE TOLLEY: I think the member is jumping to great conclusions, because there is no evidence produced in the report. It asked some legitimate questions about changes in practice and what effect that might have had on the reporting, all of which have been answered today very clearly by the Chief Social Worker, Paul Nixon.

Carmel Sepuloni: Does she agree with the Children’s Commissioner, who said in the select committee today: “The Government’s own data does not show change when it comes to child poverty.”?

Hon ANNE TOLLEY: Well, no, I do not necessarily agree with the Children’s Commissioner, because I do not know upon which measures he is commenting. As I have said, the ministry produces a regular report that has a number of measures of poverty and hardship, and which particular ones he is using, I have no idea.

Carmel Sepuloni: Does she agree with her own ministry’s report on household incomes that 305,000 kids are in poverty on her watch and this number has gone up by 45,000 in 1 year alone?

Hon ANNE TOLLEY: The member misquotes the Ministry of Social Development’s report mischievously. As the report itself stated, to use that figure would be mischievous, because in fact it reflects the median income raised by 3 percent. The opposite to that is that you could reduce child poverty by reducing the median income, which just shows how stupid the member is to quote that figure.

Mr SPEAKER: Order! The last part of that answer will clearly lead to disorder.

Carmel Sepuloni: I raise a point of order, Mr Speaker. I take offence at the last comment made by the Minister. I ask her to withdraw and apologise.

Mr SPEAKER: I was about to do that, but then there was so much interjection coming from my left. On the basis that it has now been raised by the member, I require the Minister to stand and withdraw the last part of that answer.

Hon ANNE TOLLEY: I withdraw the last remark. [Interruption]

Mr SPEAKER: Order!

Grant Robertson: I raise a point of order, Mr Speaker.

Mr SPEAKER: A point of order, Grant Robertson, and this will be a point of order, I expect.

Grant Robertson: You required the Minister to withdraw that statement. She subsequently interjected across the House that she was not going to apologise for it because it was true, which I believe runs counter to your ruling.

Mr SPEAKER: If the Minister did interject, I would be most upset. I am asking the Minister: did she interject in that vein?

Hon ANNE TOLLEY: I was reacting to a comment—

Mr SPEAKER: Order! If the Minister then did—

Hon ANNE TOLLEY: No, I am sorry, it was to another comment that told me I was supposed to apologise. I said: “No. It’s true.”

Mr SPEAKER: For the benefit of all members, when offence is taken at any remark, I consider the tone of the question, the words, the way they were used. I am the sole determinant of the action that is then taken. It might, in some cases, require a member to withdraw the comment. It may, in some cases, require a member to withdraw and apologise for the comment. And in very extreme cases it may require the Minister or member to leave the House, if I so decide. But I am the determinant of that, and I determine it on the basis of each incident. It is difficult for any member to compare one with another. I will make the decision.

Chris Hipkins: I raise a point of order, Mr Speaker. I absolutely understand that, and I do not think that that is the issue in question. The issue in question is where a Minister, or any member, is required to withdraw, or withdraw and apologise, and then basically uses an interjection to say: “But I don’t mean it.” In this case the Minister withdrew her comment and then interjected, whether it was in response to you or to someone else, to say: “I didn’t mean any of that.” That actually makes the whole process meaningless.

Mr SPEAKER: The difficulty is I did not hear the interjection. [Interruption] Order! I then took it up with the Minister, who said at that stage that she was responding to a further interjection from somebody else. It is difficult to go back. If the Minister had taken the opportunity of then saying she did not agree with the withdrawal of this comment, I would do something about it. I cannot be sure that that was the case.

Corrections, Department—Confidence

8. DAVID CLENDON (Green) to the Minister of Corrections: Is she confident the Department of Corrections will be meeting all of its targets by 2017?

Hon JUDITH COLLINS (Minister of Corrections): It is going to be tough, but if anyone can, the Department of Corrections can.

David Clendon: When did the Department of Corrections first inform the Minister that the muster is due to hit close to 10,000 by the close of this year, a blow-out of some 1,200 inmates?

Hon JUDITH COLLINS: Probably in our first meeting, actually. But I would say that I would not call it a blow-out. I would say that the right people are in prison for the right time.

David Clendon: I raise a point of order, Mr Speaker. I appreciate that the Minister—[Interruption]

Mr SPEAKER: Order! This is a point of order. There will be no interjections from anybody. Ministers, front-benchers from either side—if they are going to continue to interject on points of order, they will leave me with no choice but to ask people to leave the Chamber.

David Clendon: The Minister did address the question, but I am not party to knowing when her first meeting with the head of the department was. I would like to—

Mr SPEAKER: Order! I gather the point. If the Minister could assist us by telling us approximately when the first meeting took place with her officials.

Hon JUDITH COLLINS: I was sworn in as the Minister of Corrections on 18 December 2015, so it would be some time after that. But if the member really wanted to know, he could pop it down as a primary question.

David Clendon: What is the extra cost to the taxpayer of the unforeseen increase in the prison population?

Hon JUDITH COLLINS: Well, that depends very much on what the Department of Corrections has to do in relation to that, but I would say to the member that the cost to the taxpayer is nothing compared with the cost to victims of being victimised by violent offenders.

David Clendon: Is the Minister aware that inmates are being denied parole because of the backlog of inmates awaiting rehabilitation programmes that they must complete before they can be granted parole?

Hon JUDITH COLLINS: I think that the Parole Board always tries to get people to undertake their programmes, but I would also say to that member that sometimes it is not—

Andrew Little: It’s not the Parole Board’s responsibility; it is the Department of Corrections’.

Hon JUDITH COLLINS: Oh dear, well, ask a question, Mr Little, if you really want to. The Department of Corrections cannot force people to undertake rehabilitation programmes, and quite often it has said to me that it cannot get some offenders to do that.

David Clendon: Will the Minister allocate more funding to rehabilitation and reintegration, given comments made to the select committee this morning by Ray Smith, Chief Executive of the Department of Corrections, that more spending on reintegration and rehabilitation will reduce the prison population?

Hon JUDITH COLLINS: The member will have to wait for Budget 2016.

David Clendon: Does the Minister now regret some of the policies that she has effected in her term as Minister of Justice, given that those same policies have contributed to the blowout in the prison population?

Hon JUDITH COLLINS: Oh, well, definitely not. In fact, I would say to that member that what has in fact led to an increase in the prison population is that very serious violent offenders are being treated as very serious violent offenders.

Small Businesses—Confidence

9. MELISSA LEE (National) to the Minister for Small Business: How are Government policies contributing to increasing confidence among small businesses?

Hon CRAIG FOSS (Minister for Small Business): Confidence amongst small businesses continues to grow, as highlighted in the recent Westpac Business Growth Monitor, which showed over half of New Zealand’s small and medium businesses are confident of growing their businesses over the next 6 months. The ANZ Business Micro Scope also showed increased investment intentions across the small business sector. Government policies such as the roll-out of ultra-fast broadband, implementing the 90-day trial, our ongoing programme of pursuing free-trade agreements, and policies that have led to low interest rates are all contributing to increased business confidence.

Melissa Lee: What other policies are contributing to the increasing confidence among small and medium businesses?

Hon CRAIG FOSS: Small and medium businesses will take confidence from this Government’s programme to pursue free-trade agreements, and to abide and honour those free-trade agreements. Our agreements with Korea, and Chinese Taipei, and the recently signed Trans-Pacific Partnership agreement will give small and medium businesses more confidence through the many opportunities that are created. This is especially important in regions such as Southland, Tasman, Marlborough, and Hawke’s Bay, where around 40 percent of jobs in those regions are in the export sector. New Zealand small businesses can have confidence that the National Government will abide by our free-trade agreements.

Jacinda Ardern: Can he confirm that the same Westpac survey that he boasts from found that only 16 percent of small to medium sized enterprises intend to hire more staff over the next 12 months, and that “their view on the economy is a red flag against hiring staff”?

Hon CRAIG FOSS: I cannot confirm that, but what I can confirm is that in the ANZ sector—let me have some quotes—hiring intentions with the small business community rose eight points over the quarter. I think it is no coincidence that the increased confidence in the last quarter of 2015 coincides with the signing of the Trans-Pacific Partnership.

Question No. 8 to Minister—Amended Answer

Hon JUDITH COLLINS (Minister of Corrections): I seek leave to correct an answer that I gave to Mr Clendon.

Mr SPEAKER: Leave is sought for that course of action. Is there any objection? There is none.

Hon JUDITH COLLINS: Thank you. I said that I was sworn in as a Minister on 18 December 2015. It was, in fact, 14 December 2015. I apologise for that error.

Mr SPEAKER: I am surprised you forgot.


Earthquake Commission—Confidence

10. Dr MEGAN WOODS (Labour—Wigram) to the Minister responsible for the Earthquake Commission: Does he have confidence in EQC’s oversight of all claims related to the Canterbury earthquakes?

Hon GERRY BROWNLEE (Minister responsible for the Earthquake Commission): I was not sure it was me for a minute there, but yes. As of 31 January the Earthquake Commission has managed more than 67,000 home repairs, made 97,000 cash settlements, and resolved more than 60,000 land claims. Ninety-nine percent of homeowners scheduled for cash settlements have been paid. Ninety-eight percent of those in the managed repair programme have had their repairs completed. The Canterbury earthquakes were one of the largest insurance events ever, anywhere in the world. The Earthquake Commission has managed hundreds of thousands of claims and has made good progress, although it has not always been easy for either the Earthquake Commission or its customers.

Dr Megan Woods: Why should Cantabrians share his confidence when the Earthquake Commission is having to redo thousands of those repairs, and thousands of other homeowners have unresolved claims 5 years on?

Hon GERRY BROWNLEE: Of the 67,000 completed home repairs, just over 5,000 homeowners have indicated that they would like to have a second look at some of the work that related to that repair. That is a rate of 8 percent—an 8 percent return rate on 67,000 homes. I present to the House and will seek leave to table a Building Research Association of New Zealand report indicating that when someone gets a new home built it is not uncommon for more than 80 percent of those homeowners to call the builders back. I think the 8 percent rate on the Earthquake Commission repairs is exceptional.

Dr Megan Woods: Does he think it is a reflection on his leadership of the Earthquake Commission when 60 percent of staff do not have confidence in the leadership of the organisation and nearly three-quarters of staff do not believe that the Earthquake Commission delivers on the promises it makes to customers?

Hon GERRY BROWNLEE: The answer, fundamentally, is no. What I would say is that when you look at a set of results from a survey picking out specific questions without seeing them in the context of the whole survey is hardly reasonable. I would suggest, for example, that this means that there is a 40 percent confidence rate. Let me be clear: if that were a result in any poll for the Labour Party, the member would be dancing in the aisles.

Dr Megan Woods: I seek leave to table the survey that shows that the Earthquake Commission—

Mr SPEAKER: Order! [Interruption] Order! Whose survey?

Dr Megan Woods: It is the IBM Earthquake Commission engagement survey 2015—

Mr SPEAKER: On the basis that that is not freely available, I will put the leave. The House can decide. Leave is sought to table that particular survey. Is there any objection? There is not. Document, by leave, laid on the Table of the House.

Dr Megan Woods: Does he consider that the Earthquake Commission spending $23.5 million in legal bills fighting the people of Canterbury is a good use of taxpayer money, or could it be better used fixing people’s houses?

Hon GERRY BROWNLEE: Once again you would have to look at each of the individual cases that are finding their way to the courts. If you look at the headline analysis of the work that has been done, it is overwhelmingly positive. We are talking about a very small percentage of cases at the end of a programme. What I would say is that the Earthquake Commission is like any other insurer: it cannot step outside its policy bounds. If it does so it comes at a cost, in this case to the taxpayer, but in the long term, because of the effect it may have on the purchase of reinsurance, to every single New Zealand household insurance purchaser. So I think it has acted appropriately. I think the board has managed the situation well, and, frankly, for an event of this size, the litigation surrounding it has been absolutely minimal.

Dr Megan Woods: Why should Cantabrians believe that the Earthquake Commission’s response to claims from Sunday’s earthquakes will be any better handled than the mess of the last 5 years?

Hon GERRY BROWNLEE: Firstly, I do not accept that there is a mess from the last 5 years, and any reasonable person looking at the statistics would have to agree, remembering that it is the taxpayer of New Zealand who backs this scheme to the hilt. There have so far been, as I understand it, at just around about midday today, some 1,700 claims lodged as a result of Sunday. It is expected that up to half of those could be for contents only, and we would expect that the assessment process will be carried out as efficiently as is possible, but the work will be done first for those who are still waiting.

Australia—Detention Centres

11. DENISE ROCHE (Green) to the Prime Minister: Will he ask Australian Prime Minister Turnbull to close the offshore detention centres, when he meets with him this week?

Rt Hon JOHN KEY (Prime Minister): It is not my intention to, no.

Denise Roche: Is it humane for babies and children to be detained in offshore detention centres?

Rt Hon JOHN KEY: That would depend on the circumstances they were in, but anyway that is a policy that is one of the Australian Government’s. Funnily enough, it seems to me that the Green Party wants to be opposed to the Trans-Pacific Partnership because it does not want other countries telling us about our policies—

Mr SPEAKER: Order!

Kiwifruit Industry—Exports

12. TODD MULLER (National—Bay of Plenty) to the Minister for Primary Industries: What reports has he received on growth in kiwifruit exports?

Hon NATHAN GUY (Minister for Primary Industries): Zespri’s December forecast shows that Green volumes have increased 16 percent to over 80 million trays, and SunGold volumes are up nearly three times on last season. Zespri is closing in on total sales of nearly 21 million trays in Japan, which is a record result for this market. The forecast payment for growers is $1.1 billion, which is up $177 million on the 2014-15 result. This demonstrates the industry’s strong recovery from the impact of Psa.

Todd Muller: How will the Trans-Pacific Partnership (TPP) help our kiwifruit growers?

Hon NATHAN GUY: The MP for the Bay of Plenty will be excited to know that the TPP will eliminate all kiwifruit tariffs at entry into force. [Interruption]


Hon NATHAN GUY: There is a lot of excitement about the TPP on this side of the House, Mr Speaker. This is worth $15 million per year and equates to an average saving of $6,000 per grower, per year. Importantly, the industry will save over $15 million from tariffs into Japan, which is Zespri’s largest market. This will benefit Japanese consumers and our exporters by supporting our overall competitiveness against other fruit in that market. Zespri is expecting annual sale volumes to Japan to increase by around 10 percent over the next 5 years.

Todd Muller: What reports has he received from the kiwifruit industry on the importance of the TPP?

Hon NATHAN GUY: Zespri’s chief executive, Lain Jager, said: “This is an excellent result for our industry, which is set to earn nearly $2 billion in sales revenue this season and growing strongly.” He adds: “The reality is that New Zealand is a small nation reliant on exporting to earn our way in the world and these agreements are vital to our future prosperity.”


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