Questions and Answers – November 12

Press Release – Office of the Clerk

1. MAGGIE BARRY (NationalNorth Shore) to the Minister of Finance : What do official statistics show about progress in the Governments goal of supporting new jobs and higher incomes for New Zealanders?


1. MAGGIE BARRY (National—North Shore) to the Minister of Finance: What do official statistics show about progress in the Government’s goal of supporting new jobs and higher incomes for New Zealanders?

Hon BILL ENGLISH (Minister of Finance): First, it is important to recognise that businesses create jobs and the Government is following a supportive policy for businesses and the people who work in them, so that they can invest more and create more jobs. Recent indicators confirm that the programme is working. In the September quarter 27,000 more New Zealanders had jobs than in the previous quarter. The increase in jobs over the year to September stood at 53,700. Regional employment data was moderately strong, with eight regions having a lower unemployment rate than Auckland.

Maggie Barry: What did labour-market statistics show last week in respect of overall employment levels, labour-market participation rates, and hours worked, across the economy?

Hon BILL ENGLISH: The results from the survey for September were a bit more positive than expected, although, to be fair, those expectations were pretty moderate. Employment increased by 2.4 percent in the year to September. The labour-market participation rate—that is, the proportion of the potential workforce that regards itself as being in the labour market—increased by half a percentage point, to 68.6 percent, and the unemployment rate fell to 6.2 percent. Both the number of hours worked and the number of hours paid rose, and this is indicative of reasonably good growth for the whole economy. Wage growth accelerated more than expected, according to the quarterly employment survey. All these indicators suggest that the economic recovery is gathering some momentum—and, I am pleased to say, particularly in the regions and particularly in manufacturing.

Maggie Barry: How does New Zealand’s rate of unemployment compare with unemployment levels in other developed economies?

Hon BILL ENGLISH: At 6.2 percent, it is still higher than we would like to see it, but it is a considerable improvement on 7.2 percent a year earlier. This improvement is more noteworthy given that New Zealand’s labour-market participation rate has increased significantly, to 68.6 percent, which is high by world standards. In a number of other developed economies, participation rates are falling, as people are discouraged from looking for work. Our unemployment rate is a bit higher than Australia’s 5.7 percent; however, in New Zealand—[Interruption] No, just listen to this. In New Zealand 64.4 percent of the working age population is in work. In Australia that percentage is 61.1 percent of the population in work. So a bigger proportion of the New Zealand population is in work than in Australia, by quite some margin, and our unemployment rates are pretty similar.

Maggie Barry: According to official labour-market statistics, how do recent wage increases compare with movements in the cost of living?

Hon BILL ENGLISH: This is particularly relevant for households that feel the pressure of rising costs and for many New Zealand households that have had to wait a bit long for wage increases. The quarterly employment survey measure of average hourly earnings rose 2.6 percent in the year to September—almost double the 1.4 percent increase in the CPI for the same period. So average hourly earnings rose almost twice as fast as the Consumers Price Index. This is moderately helping families to get ahead of the cost of living.

Andrew Little: Why is half the workforce not getting a pay increase in any one year?

Hon BILL ENGLISH: We will continue to pursue policy that locks in, to the extent that it can, relatively low inflation, but, more important, policy that supports workplaces paying higher wages.

Pike River Mine Disaster—Compensation

2. Hon DAVID CUNLIFFE (Leader of the Opposition) to the Prime Minister: Does he stand by his statement yesterday that the compensation awarded to the Pike River families “should be serviced by the company, not by the Crown”?

Rt Hon JOHN KEY (Prime Minister): Yes.

Hon David Cunliffe: Can the Prime Minister confirm that he believes that the Government should have no role in the compensation to the families of the Pike River miners, given that the royal commission found that the Department of Labour did not have the focus, capacity, or strategies to ensure the compliance of the mine, and that the department “should have prohibited Pike from operating the mine …”?

Rt Hon JOHN KEY: Let me summarise a few things from the Government’s point of view. Firstly, we have great sympathy for the families. Secondly, the Government has honoured all of its legal obligations as it sees them—certainly, in terms of ACC payments and the like. Thirdly, the Government has been extremely supportive of New Zealanders and the donations that they have made to the trust funds that were set up for the families. But the Crown’s legal position is that it sees no course of action that could be the basis for the Government legally having to pay compensation to the victims’ families.

Hon David Cunliffe: Did the Prime Minister tell the Australian newspaper that the Pike River mine, a single-entry uphill mine, “ ‘couldn’t have been constructed in Australia’ because it would have been ‘illegal’. ”; if so, does he still believe that the Crown has at least no moral responsibility to help contribute to the compensation of the families of the dead miners?

Rt Hon JOHN KEY: In terms of the first part of the question, yes, I made that statement. In terms of the second part, the Government believes there is no course of action. Obviously, the legal representatives of the family are free to test that case in court. But the Government is also a guardian of taxpayers’ money, and it would need to be very careful about any precedent that it might set. There are plenty of New Zealand companies that, for instance, go broke and actually do not end up paying redundancy payments that are owing to those workers. So that situation is another situation that the Government would have to avoid.

Hon David Cunliffe: Does the Prime Minister accept that at least two entities of the Crown, the New Zealand Superannuation Fund and the Accident Compensation Corporation, are parent shareholders of Pike River Coal, and that they have received insurance payouts on behalf of Pike River Coal that they have not passed on to the families; if so, does he still maintain that the Crown has no moral or legal obligation to contribute to the compensation for the dead miners?

Rt Hon JOHN KEY: I am not aware of those particular claims. I have made no comment about the moral position. What I have made quite clear, though, is that the advice that the Government is following is the legal advice it has received, and that is that there is no course of action.

Hon David Cunliffe: Given that the Prime Minister has said that the families of the deceased miners must further test their case in court, does he agree with the judge in the original insurance case that New Zealand Oil and Gas, the primary parent of Pike River Coal, should pay the full compensation; if so, what steps, regulatory or otherwise, has he taken to make that happen?

Rt Hon JOHN KEY: That is not my responsibility as Prime Minister.

Hon David Cunliffe: What steps of any kind has the Prime Minister taken in respect of any parent entities that have together received $80 million of insurance money and paid out none of it to the families, who have received only $5,000 per head out of the $110,000 court-ordered compensation, and why does he wash his hands like a modern-day Pontius Pilate of this travesty that is occurring on his watch?

Rt Hon JOHN KEY: The Government’s responsibilities rest with the legal framework that is there for any person or any family who would be in this situation, and that is through ACC. The Government is not responsible for a compensation claim that was awarded against the company, any more than it would be for, for instance, payments made to a redundant worker. If the families believe there is a course of action, they should test the course of action.

Hon David Cunliffe: Did the Prime Minister have a legal obligation to give $30 million to Rio Tinto, and does he have a legal obligation to pay up to $400 million in subsidies to Chorus; if he does not have a legal obligation to those two companies, why does he not have a moral obligation to the families of the dead miners?

Rt Hon JOHN KEY: Well, I think the Government has not paid anything to Chorus yet, in terms of what the member is talking about. In terms of Tīwai Point—I really have to caution the member. I think he is doing a great disservice to the families when he starts playing silly political games.

Hon David Cunliffe: I raise a point of order, Mr Speaker. I do take offence to being impugned in respect of the families of the Pike River miners when the entire push by the Opposition has been to ensure they get what is due to them, which the Prime Minister is denying.

Mr SPEAKER: Order! I am surprised that the member has taken offence. If the member has taken offence at something the Prime Minister said, I guess we have got to ask the Prime Minister to withdraw, but I cannot think of anything the Prime Minister said that could possibly offend the member.

Crime Victims, Sexual Offences—Support

3. KATRINA SHANKS (National) to the Minister of Justice: What steps is the Government taking to support victims of sexual violence?

Hon JUDITH COLLINS (Minister of Justice): The Government is committed to providing better support for victims of crime, including all victims of sexual violence. As a result of the Law Commission’s recent review of the Evidence Act, I will shortly be introducing proposals to improve the way some evidence is dealt with in these cases. If the defence wants to raise issues about a complainant’s previous sexual history, they will need to give notice before trial. In addition, child witnesses under the age of 18 will be able to give evidence by video recording, which can be challenged in trial. They will be able to have a support person sitting nearby when they give evidence. There is a range of support services for sexual violence victims across the Government. They include specialist victim support, no real limitation period on the making of a complaint, automatic name suppression in criminal proceedings, and the court is closed when victims give evidence. Victims can give evidence behind a screen, and they are allowed a support person with them in court while giving evidence, and there is a range of counselling and financial support through the Ministry of Justice, ACC support, or the Ministry of Social Development, including funding of agencies such as Doctors for Sexual Abuse Care, Auckland Sexual Abuse Helpline, and Wellington Rape Crisis. The Victims of Crime Reform Bill, which is awaiting its second reading, will also introduce a new victims’ code.

Katrina Shanks: What criminal processes exist to deal with sexual violence offences?

Hon JUDITH COLLINS: In New Zealand we have a common law justice system based on democratic principles of fairness. Some European and former communist countries have a different system, the inquisitorial method of criminal justice, which effectively means that any accused

person has to prove their innocence. Accused persons are examined directly by judges trained in the inquisitorial method of examination. There is limited ability to challenge evidence presented to the judge. In the common law method, prosecution and defence each present their evidence and arguments to the court, and have the right to challenge each other’s evidence. In 2012 the Law Commission published an issues paper and invited submissions on a range of pre-trial and trial processes, particularly to consider whether inquisitorial processes could be incorporated into our justice system for sexual offences. Some of the issues considered have been advanced, such as child protection orders, greater use of restorative justice to deal with sexual violence offences, protection for child witnesses, and requiring notice to be given if the defence intends to raise evidence of the complainant’s prior sexual history.

Katrina Shanks: What else is the Government doing to help prevent sexual violence victimisation?

Hon JUDITH COLLINS: Prevention is obviously the key for progress in this matter. Sexual violence is obviously abhorrent but it is also linked with alcohol and other drugs. The Government’s alcohol reform legislation comes into force on 18 December. From 18 December this year it will be an offence to supply alcohol to a minor without parental consent. In addition, the Government has passed the Psychoactive Substances Act to stop the sale of harmful party pills. The Ministry of Health funds a rape prevention programme in schools called BodySafe, which is currently run in many schools and teaches young people how to keep themselves safe from sexual violence and how to deal with a sexual attachment if it does happen. Earlier this year, Minister Bennett announced a major funding boost for victims of sexual violence through agencies such as the Auckland Sexual Abuse Help Foundation. In addition, ACC is redesigning its support, assessment, and treatment services for sensitive claims to provide more responsive services to victims of sexual violence. Sadly, many victims of sexual violence are repeat victims, and part of the approach is to help victims keep safe to prevent re-victimisation. There is a good deal currently being done to deal with sexual violence in this community, and it is a real problem that affects old and young. We need to continue to bring offenders to justice and to acknowledge that sexual violence is a crime and needs to be dealt with accordingly.

Capital Gains Tax—Investment Properties

4. Hon DAVID PARKER (Deputy Leader—Labour) to the Minister of Finance: Will the Government tax realised capital gains on investment property; if not, why not?

Hon BILL ENGLISH (Minister of Finance): The Government already taxes capital gains on property speculation where property investment is for the purpose of trading. The member may not be aware of that. In addition to this, the Government’s 2010 tax changes on property disallowed deductions for building depreciation, and this raises around $700 million per year from property investors, a much larger number than any estimate we have seen for the foreseeable future for a further extension of the capital gains tax. Further extension of the current tax on capital gains is likely to have high compliance costs, and that is a conclusion that three tax inquiries and several Governments have come to over the last 20 years. If it excludes the family home, it will not raise much difference, it will not raise much revenue, and it becomes effectively a tax on successful businesses. In overseas jurisdictions, it has not improved housing affordability.

Hon David Parker: Why does he think the profits on the sale of investment property are of such critical importance to the economy that they should not be taxed but instead be cross-subsidised by every other taxpaying business and worker in New Zealand?

Hon BILL ENGLISH: I would point out two things, as I pointed out in the primary answer. First, where any property is bought for the purposes of selling, the gains on that are taxed at current income tax rates. It is called an income tax, but actually it is a capital gains tax on trading investment property. The member may have seen recent publicity about the scope of the Inland Revenue Department’s activities in ensuring that everyone who does trade in property pays full

income tax rates, not the half-baked rate that he proposes in his proposition of 15c in the dollar. They are actually taxed at 33c currently. Secondly, the changes made in the 2010 tax package do collect $700 million per year from property investors, which is a much larger number than any revenue that he has posited as a result of his partial extension of the current capital gains tax.

Jami-Lee Ross: In considering various tax options for New Zealand, what international evidence has the Minister seen on the effects of capital gains taxes on housing affordability?

Hon BILL ENGLISH: I have seen reports from Australia on the effects of a partial capital gains tax, limits on foreign investment, a so-called mansion tax, and compulsory savings. If these policies are meant to improve housing affordability, then they have not, because housing affordability is worse in Australia than in New Zealand. Just today there is a report being published showing that first-home buyers now make up the smallest proportion of the housing market ever in Australia. So the housing market in Australia now consists of fewer first-home buyers than ever, so we would be a bit careful about following that policy prescription.

Hon David Parker: What proportion of investment property sales pay tax as traders; is it closer to zero percent than 100 percent?

Hon BILL ENGLISH: I do not have that information to hand, but I can assure the member that the Inland Revenue Department is vigorously pursuing every investor who trades in property.

Jami-Lee Ross: What reports has the Minister received on the case for a new capital gains tax in New Zealand?

Hon BILL ENGLISH: I have received the report of a speech to the Wellington Property Investors Association in July 2005. It noted that the Government-appointed tax review in 2001 considered a new capital gains tax and concluded that the disadvantages of such a tax—its complexity and costs—outweighed the theoretical benefits, so it did not recommend such a tax. The speech also noted that the Government of the day agreed with that conclusion that the status quo was entirely adequate. The speech was delivered on behalf of the Minister of Finance Michael Cullen by his associate David Cunliffe.

Hon David Parker: Is it fair that every dollar earned by a salary or wage earner is taxed, every dollar spent by working New Zealanders on consumption is taxed, yet wealthy people who sell off investment properties for millions of dollars ordinarily pay no tax on their capital gains?

Hon BILL ENGLISH: In the first place investors in property do pay tax on their capital gain if they are trading. That is really important. Secondly, they no longer have the benefit of depreciation deductions, which means they are paying $700 million a year more tax than they were. But the fundamental position has not changed. A capital gains tax might have an effect if it is comprehensive—that is, if it covers all capital gains in the economy. But no one is proposing that and I do not think there is anyone in the House here who believes that it is practical to implement such a tax in New Zealand.

Hon David Parker: Given that the majority of the public agree that a capital gains tax excluding the family home would be more effective in taking the heat out of the property market than loan-tovalue restrictions, why is it that under this Government we have loan-to-valuation restrictions that hurt young people and first-home buyers in favour of property speculators?

Hon BILL ENGLISH: Firstly, the Labour Party was actually a couple of years ago saying that we were old-fashioned on monetary policy in not implementing macro-prudential mechanisms like loan-to-value ratios. Of course, now that the Reserve Bank has done that, it is not so keen on it. Secondly, a comprehensive capital gains tax might have a benefit, but no one is prepared to implement that, including the Government. A partial capital gains tax has no real impact on housing affordability, including for first-home buyers, and we need only to look to Australia to see that.

Hon David Parker: Is not the truth of the matter that conservative Governments like National try to hang on to tax advantages like the lack of a capital gains tax on investment properties, because this is what is in the interests of their backers?

Hon BILL ENGLISH: If the member is wanting to make that assertion, then he should explain why David Cunliffe made a speech, when representing the Minister of Finance, arguing against a partial capital gains tax. And when I have heard the member’s explanation of that, we can continue the debate.

Human Rights, Sri Lanka—Commonwealth Heads of Government Meeting

5. JAN LOGIE (Green) to the Prime Minister: Will he oppose Sri Lanka chairing the Commonwealth following the Commonwealth Heads of Government meeting in Sri Lanka, as called for by the Commonwealth Human Rights Initiative?

Rt Hon JOHN KEY (Prime Minister): The process for appointing Sri Lanka as the chair of the 2013 Commonwealth Heads of Government Meeting took place in Perth in 2011. All member States of the Commonwealth endorse Sri Lanka taking on this role. As host of this year’s meeting, Sri Lanka automatically becomes the chair in office of the Commonwealth for the following 2 years. The process has been followed ever since the role of chair in office was established in 1999. The Commonwealth operates by consensus amongst its 53 members. I can tell the member that no process exists to install a different chair in office for 2014-15. There is no vote held. Sri Lanka is automatically the chair.

Jan Logie: I seek leave to table a letter from the Commonwealth Human Rights Initiative to John Key, dated 6 November, asking for them to oppose the appointment.

Mr SPEAKER: Order! Leave is sought to table that particular letter. Is there any objection? There is none. It can be tabled. Document, by leave, laid on the Table of the House.

Jan Logie: Why will his Government not put out a statement opposing Sri Lanka chairing the Commonwealth for the next 2 years, in order to put pressure on the regime to change?

Rt Hon JOHN KEY: Because there is no process for changing the chair.

Jan Logie: Does he accept that there are serious human rights abuses that have taken place and are still taking place in Sri Lanka?

Rt Hon JOHN KEY: It is highly likely that there have been significant human rights abuses that certainly took place at the back end of the civil war, and some of those could be ongoing. They will be matters I raise personally with the President when I meet with him later in the week.

Jan Logie: Does he consider that the human rights situation in Sri Lanka is better or worse than in Fiji; and, if his Government is willing to talk tough on Fiji, why will it not take firm action on Sri Lanka?

Rt Hon JOHN KEY: The major issue that the Government has with the incumbent Government currently in Fiji is not one of human rights, although those issues are raised from time to time. The issue is the way that the Fijian Government was installed, and that was through a military coup. That is the reason why the Government takes action against the current Government of Fiji.

Jan Logie: Is he concerned that having the Sri Lankan President, Mahinda Rajapaksa, chairing the Commonwealth for the next 2 years might undermine international efforts to get an independent inquiry into war crimes and human rights violations in Sri Lanka?

Rt Hon JOHN KEY: No, I do not think that will be the effect. I think, actually, the effect of Sri Lanka being in the chair and therefore hosting the event is that the world’s media will descend on Colombo and draw its own conclusions. I do note that before I came to the House I rummaged through my office to see whether I could find any statements from the Green Party about Sri Lanka becoming the chair a couple of years ago. It may have issued one but I am not sure I saw it.

Jan Logie: Is he aware that local Tamils and Sinhalese human rights activists believe that the current approach of this Government is validating the regime and buying them time to entrench their power?

Rt Hon JOHN KEY: I am sure there is a range of views on the ground in Colombo and in Sri Lanka.

Jan Logie: Will New Zealand support the call of United Kingdom Prime Minister, David Cameron, for an international inquiry into allegations of war crimes in Sri Lanka?

Rt Hon JOHN KEY: We may well do so; we have not drawn a conclusion on that yet.

Hon Maryan Street: Why will he not move to create a process to challenge Sri Lanka’s chairing of the Commonwealth by working with other like-minded Commonwealth countries, and thereby take an active, rather than a passive, approach to human rights records in that country?

Rt Hon JOHN KEY: Firstly, the Government is not taking a passive approach. In the last 12 months the Minister of Foreign Affairs has been to Sri Lanka twice, he has raised the issue of human rights with that Government, and he is travelling to the north, where significant human rights abuses may well have taken place during the back end of the civil war, and I am having a meeting with the President to raise New Zealand’s concerns. I do not think that it is a strong argument that the Opposition can mount that we do not take human rights concerns in Sri Lanka seriously.

Sharks—Conservation Initiatives

6. NICKY WAGNER (National—Christchurch Central) to the Minister of Conservation: What steps is the Government taking to improve the conservation of New Zealand’s 113 species of shark?

Hon Dr NICK SMITH (Minister of Conservation): The Government at the weekend announced a new plan of action for the conservation of sharks. It includes a ban on shark finning. It is already illegal to fin a shark live and return it to the sea. The change is to prohibit the catching and killing of a shark and the discarding of its remaining carcass except its fins. This change will assist global efforts to conserve sharks, of which 30 percent internationally are threatened or nearthreatened with extinction. The plan also provides for the total protection of the seven species of shark that are the most threatened.

Nicky Wagner: When will the ban take effect, and why is it necessary to have a 2-year transition in some fisheries?

Hon Dr NICK SMITH: It is proposed that the ban take effect at the beginning of the next fishing year, which is on 1 October 2014 for most fisheries. For others time is needed to develop safe and sustainable fishing practices. Sharks are often caught as bycatch in the longline tuna fishery. The current practice is to kill the shark, remove its fins, and then dump it at sea because the hull space is needed for the more valuable tuna. We actually need to work with fishers in this fishery on safe methods to unhook the shark and return it live to the sea. That is not without its challenges. The 2-year transition is proposed to develop, trial, and implement these new shark conservation measures.

Sexual Offences—Pre-trial and Trial Processes

7. ANDREW LITTLE (Labour) to the Minister of Justice: Does she stand by all her answers to Oral Question No. 9 on Tuesday and Oral Question No. 8 on Wednesday last week?

Hon JUDITH COLLINS (Minister of Justice): Yes.

Andrew Little: Why, when asked last Tuesday: “Will the Minister implement the recommendation of the Law Commission, made in March this year, to modify the law on evidence in sexual offence cases …?”, the recommendation of which related to advance notice being given of evidence of previous sexual experience, did she say: “No.”, and then tell the Sunday Star-Times in the weekend just gone and the Dominion Post as reported today that she is now planning to change the law of evidence in exactly the way that the Law Commission has recommended?

Hon JUDITH COLLINS: Well, actually, the member has misquoted himself, again. What we have is that he went on to say—when he put the quote mark in there, it was not quite right, and I am

sure he knows it when he looks at the Hansard—“so that victims are not re-victimised when giving evidence on offences against them?”. Well, actually, there is no way at all that anyone would think that the changes to the Evidence Act will, of themselves, prevent victims from being re-victimised when they give evidence. I can tell that member that I cannot think of any proposal that would prevent victims from feeling utterly re-victimised whenever they have to give their evidence.

Andrew Little: What happened between question time last Tuesday and question time last Wednesday so that when she was asked to explain her “No.” answer given on Tuesday, she first denied that she was asked the question, then said that I was confused, and then said that she was looking at the issue, when on the previous day she said that there was no need to?

Hon JUDITH COLLINS: I cannot speak for that member, Andrew Little, but I can certainly say that I had a lot of work to do, and I went to sleep and woke up very refreshed, thanks very much for asking.

Andrew Little: Does she think that her suggestions in the New Zealand Herald today of providing better information about core processes to victims, allowing someone else to read a victim’s impact statement to the court, and providing notification to victims about bail or parole— all of which presuppose a prosecution to be on foot—are sufficient to deal with the fact that 90 percent of sexual violations go unreported and only about 1 percent of sexual violence events result in a conviction?

Hon JUDITH COLLINS: I cannot imagine for a moment that the proposals that I am supporting would, of themselves, go anywhere near dealing with the trauma of a rape victim having to give evidence, to make a complaint, to confess to their family members where they might or might not have been, and to get rid of those dreadful feelings that victims have when they get accused of wearing clothes that might apparently turn moderate men suddenly into abusers. So I cannot imagine for a moment that anything that has been proposed will make a victim feel better. What it will do, however, is actually help to bring more offenders to account, and that is important.

Andrew Little: Does she accept that it is time to make real change on the law of sexual violation by ensuring that courts focus on the only issue in any such case, which is whether the act in question was consented to, ensuring that complainants are not left feeling as though they are on trial and leaving issues of mitigation to the sentencing phase, or will she just continue to deal with this important issue with her usual bombast, bluff, and bluster?

Hon JUDITH COLLINS: On the first part of that question, I would have to say that I take this issue very seriously—far more seriously than that member seems to be taking it from the nature of the second part of his question, to which I have to say I will leave it to him to be bombastic and silly about this very serious issue.

Dairy Industry—Policy

8. RICHARD PROSSER (NZ First) to the Minister for Primary Industries: What concerns, if any, does he have regarding government policy for the dairy industry in New Zealand?

Hon TIM GROSER (Minister of Trade) on behalf of the Minister for Primary Industries: I have every confidence that the policies of this Government will provide an excellent future for our No. 1 export industry. I have to say, however, that I have serious concerns that the policies that underwrite this success, such as new public-private partnership irrigation proposals, Primary Growth Partnerships, existing free-trade agreements such as the New Zealand – China Free Trade Agreement, and not to mention the Trans-Pacific Partnership, would be put seriously at risk if that member were ever to be part of a Government cobbled together from a coalition of the unwilling.

Richard Prosser: Is he concerned that vast tracts of New Zealand farmland, including dairy country, are being accumulated by foreign buyers despite a Government directive from the Deputy Prime Minister to Land Information New Zealand in 2010 noting concern over the aggregation by foreigners of large swaths of New Zealand farmland?

Hon TIM GROSER: Vast areas of our farmland are not in the hands of foreign ownership. This country’s agricultural base was actually established by foreign ownership of land, which is now standing at between 1 and 2 percent.

Richard Prosser: Does he believe it is good for anything other than property prices that Shanghai Pengxin will soon own 29 farms across New Zealand, totalling over 12,000 hectares of our most productive irrigated dairy pasture?

Hon TIM GROSER: This application is before the Overseas Investment Office at the moment and it would clearly be inappropriate for the Government to make a comment at this stage.

Richard Prosser: Is he concerned that foreign owners of large amounts of farmland have the potential to move to large-scale integration of dairy farming, including processing, which would completely lock out New Zealanders?

Hon TIM GROSER: No, I do not share that concern.

Richard Prosser: What action will he take should Shanghai Pengxin break its pledge to not invest in dairy processing and to export only finished products?

Hon TIM GROSER: Well, I will not comment on the proposal before the Overseas Investment Office at the moment, but of course there are procedures to ensure that when applications are granted and approved, the applications and the conditions that were pursuant to that are followed through, and there is a very rigorous process underlying that.

Richard Prosser: Can he confirm that Shanghai Pengxin’s pledge to export only finished products is legally enforceable, and does it extend to Shanghai Pengxin not buying out existing private dairy companies, which may themselves be able to then export bulk commodity product for further processing offshore?

Hon TIM GROSER: I refer the member to the answer to the previous question. Since this is before the Overseas Investment Office the member will have to wait and see what happens.

Drugs, Control—Regulation of Psychoactive Substances

9. Dr PAUL HUTCHISON (National—Hunua) to the Associate Minister of Health: What actions has the Government taken to ensure compliance with the Psychoactive Substances Act 2013?

Hon TODD McCLAY (Associate Minister of Health): I recently announced that the 0800 Psychoactive Substances Hotline has gone live. The number is 0800 789 652. The hotline provides a direct avenue for concerned communities, families, and parents to report any activities by users or retailers that they believe to be illegal, so that our enforcement agencies can take immediate action. The Psychoactive Substances Regulatory Authority has already withdrawn a number of licences following reports from the public. I do expect the hotline will further strengthen the public’s ability to take action when they see activity that is inconsistent with the Act.

Dr Paul Hutchison: What feedback has the Minister received on the effectiveness of the Psychoactive Substances Act?

Hon TODD McCLAY: The feedback is positive. The Psychoactive Substances Act has already had a significant impact by reducing the availability and access of these products. The number of shops previously selling psychoactive substances was estimated to be 3,000 or 4,000, and as of today it sits at 130 retailers with interim licences. Indeed, the products were estimated to be in the number of 200 to 300 available before the Act came into force, and that number was growing. Today there are just 46 with temporary licences. These products continue to be monitored closely. I have noted previously that district health boards have reported a reduction in the number and severity of reports of adverse reactions from individuals using these products, and the National Poisons Centre has also reported a reduction in the number of calls of concern to them.

Freshwater Management—National Policy Statement

10. EUGENIE SAGE (Green) to the Minister for the Environment: Will her proposed changes to the National Policy Statement for Freshwater Management ensure our rivers and lakes are safe for swimming?

Hon AMY ADAMS (Minister for the Environment): The amendments to the National Policy Statement for Freshwater Management 2011 and the creation of the national objectives framework will help to improve water quality across New Zealand, particularly through the national bottom lines and a new collaborative option for water management. Many of the attributes to meet bottom lines will be attributes that also improve water towards being suitable for swimming. Where a community determines that particular rivers or lakes are valued as swimming spots, the national objectives framework provides a robust, scientifically backed set of attributes to help communities plan to meet that objective. These are bottom lines; they are not targets. They do not limit the ability for communities to set an objective of swimmable water for any water body in its catchment.

Eugenie Sage: So, to be clear, is the Minister saying that the proposed changes to the national policy statement will not actually ensure that New Zealanders can safely swim in our rivers?

Hon AMY ADAMS: The amendments are very clear. They set nationally required bottom lines for ecosystem health and secondary contact for human health. If communities wish to also add requirements to manage those water bodies for swimming, they are absolutely able to do so. That is a choice for their communities. If they do, the national objectives framework provides a robust set of measurable criteria that they should use to work towards that goal.

Eugenie Sage: When does she expect that the 61 percent of monitored river sites that are unsafe for swimming to be clean enough to swim in, given that her proposed changes to the national policy statement do not make it mandatory for councils to set standards for swimmability?

Hon AMY ADAMS: The first point I would make is that that member continues to misquote that sample. It has never talked about the percentage of rivers in New Zealand. It talks only about the ones that are monitored. It is not representative, and it does not suggest that 62 percent are unsafe for swimming.

Eugenie Sage: I raise a point of order, Mr Speaker. I said: “When does she expect that the 61 percent of monitored river sites …”; I did not say 61 percent—

Mr SPEAKER: Order! And I have heard enough from the member. The Minister was responding to that by saying that she disagreed with the way the member had phrased her question. She has every right to do that in her answer. Does the Minister wish to continue with her answer?

Hon AMY ADAMS: What I would say is that the improvements we are making will ensure a significant improvement in the quality of water bodies across New Zealand. That will lead to cleaner waterways. I think it is somewhat rich for members of the previous Government, which did nothing and allowed the situation we now have to develop, to sit there and criticise the fact that we are doing something, when they were happy to oversee a Government that did absolutely nothing. I would have thought they would welcome it.

Eugenie Sage: Did she decide to have a national bottom line for boating and wading but not for swimming because she considered that it would be too costly for industries like dairying to reduce their contaminant leaching so that we could have rivers that are suitable for swimming?

Hon AMY ADAMS: The first point I would make is that the recommendations to have bottom lines for ecosystem health and secondary contact for human health are recommendations of the Land and Water Forum. They are not my recommendations or my decisions. The second point I would make is that they are backed up by a very robust combination of science to support them. Finally, I would make the very clear point that these indicators that we are rolling out are currently out for discussion. That is the point of a discussion document. We are now consulting with the public on the framework that we have developed based on the Land and Water Forum’s recommendations, and I encourage people to put in their views on those.

Meka Whaitiri: Tēnā koe, Mr Speaker. Tēna tātou e te Whare nei. Why, given the advice of “60 of New Zealand’s top scientists”, and having received the Land and Water Forum’s third report some 12 months ago, is she unable to come up with comprehensive minimum water-quality standards?

Hon AMY ADAMS: I reject the member’s assertion that we have not come up with comprehensive standards. What I have always said is that the development of water-quality standards under the national objectives framework is a process that will continue to develop and evolve over time. But what I am not prepared to do is do nothing until we have every answer. My view has always been that we have to start to improve water quality with all the information we do have, and continue to develop it. That is a significant step forward. And, as I have said, it is somewhat rich for parties that did absolutely nothing and were happy to watch our water quality deteriorate to now complain when we are taking action that they think should be stronger. We are doing it; they did not.

Disability Allowance—Case Management

11. SUE MORONEY (Labour) to the Minister for Social Development: Does she agree with the statement made by her spokeswoman with regard to Work and Income requirements for the disability allowance that “There’s no reason anyone would be repeatedly asked to prove a congenital condition and we have no information about any cases where that has happened”?

Hon PAULA BENNETT (Minister for Social Development): Yes. People with a congenital disability that their doctor has diagnosed as never needing to be reassessed do not need to provide ongoing medical evidence to keep their benefit going. However, if their costs change, Work and Income is required by legislation to ensure that the new costs relate to the individual’s condition or disability.

Sue Moroney: Did she read the email sent to her on 15 October by Stephen Taylor from Hamilton, who has two sons with muscular dystrophy—for which there is no known cure—who have been required to have annual medical reviews of their congenital condition, despite the fact that their GP said that they should never be reassessed, in order for them to retain the child disability allowance?

Hon PAULA BENNETT: We have more than 240,000 disability allowances that we do at the moment. If the doctor has said not to reassess, then we do not need a reassessment for the actual disability. If that has happened, then we will own up to it and we will say that that is a mistake—we will do that. But if the circumstances have changed, as we saw in the weekend papers where the young person has gone flatting or something like that, they may actually be eligible to have more assistance. So we do a reassessment on that, but not on the actual disability or medical condition.

Sue Moroney: I seek leave to table a letter from Hamilton Central Community Link to Mr Stephen Taylor, informing him that the child disability allowance has been stopped for his child Austin because it has not received—

Mr SPEAKER: Leave is sought to table a letter from Stephen Taylor. [Interruption] The member is just asking whether permission has given by Mr Taylor.

Sue Moroney: Yes.

Mr SPEAKER: Permission has been given. Leave is sought to table that particular letter. Is there any objection? There is none. It can be tabled. Document, by leave, laid on the Table of the House.

Sue Moroney: Well, did she read the email sent to her by David Wise, also of Hamilton, whose son Duigan was born with autism and global delay deficiency and was required to be reassessed four times a year by the local Work and Income office, even though his GP and specialist agreed that reassessment should take place on an annual basis?

Hon PAULA BENNETT: The way that we have set the system up, particularly since the welfare reforms, is we have simplified the forms. I have actually looked at them again today. We do not ask for people to be reassessed if their doctor has said not to. If there are cases where that is happening—and I have asked the department to look into that to make sure it is not, because it is certainly not our intention and it is certainly not our policy—then we will fix it. I have not seen evidence of it in the cases that have been presented to me.

Sue Moroney: You’re not reading your emails.

Hon PAULA BENNETT: Well, of the cases that have been presented to me, we have looked into them and the facts are different from what has actually been presented by the media. But, as I say, such reassessments are not the intention of the policy. They should not have to have doctor reassessments every year, or four times a year.

Sue Moroney: I seek leave to table an email from David Wise to the Minister on 10 November, advising her that his son is required to have reassessments four times a year.

Mr SPEAKER: Leave is sought to table that particular email. Is there any objection? There appears to be none. It can be tabled. Document, by leave, laid on the Table of the House.

Sue Moroney: Does she accept the account that Auckland woman Colleen Brown gave to the Sunday Star-Times that when she applied for a change in living arrangements for her son Travers, he was required by Work and Income to have a further medical assessment to prove that he still had Down’s syndrome?

Hon PAULA BENNETT: No, I do not. Those are not the facts as they are presented in the file.

Sue Moroney: Does the Minister accept that this constant reassessment by Work and Income of conditions that cannot be cured creates additional stress for families who already face difficult circumstances, creates unnecessary cost and bureaucracy for Work and Income, and also puts additional work on GP services that are already stretched?

Hon PAULA BENNETT: I think it is incredibly stressful for these people who have these conditions or have children with these conditions. It is certainly not our policy that we reassess if the doctor has said that we do not need to. If we are asking them to fill in forms—which in itself, I acknowledge, can be stressful—if they have had a change in circumstances—

Sue Moroney: No, to be reassessed.

Hon PAULA BENNETT: Well, I think there could be a difference in language in what is actually being asked. I have asked for—

Sue Moroney: You’re asking them to go and get a doctor’s certificate.

Hon PAULA BENNETT: Well, you do not know that, actually. You do not know—

Mr SPEAKER: Order!

Hon PAULA BENNETT: Well, the member has asked a question; I am endeavouring to answer it, Mr Speaker. So at the end of the day we do not believe that they are being reassessed. If there are cases where they are, then we will fix it. It is not our policy, it is not the way it should be happening, and I do not think it is happening in all the cases that you have presented.

Sue Moroney: Why is the Minister denying that this practice takes place when she will by now have received many emails from New Zealanders that tell her of their experiences and show that she is wrong, and will she get out on the ground and go and visit Work and Income offices to ensure that this practice of asking these families to constantly re-prove that their family members have these congenital conditions is not taking place?

Hon PAULA BENNETT: I note that the member’s sort of run on this is to try and say that I do not visit Work and Income offices, whereas, in fact, I am up and down this country weekly and on the front line, talking to those staff. What I am saying is that there could be a difference of interpretation of us asking for information and reassessment. The information that I have had from the department is that we do not require another medical assessment of those on this allowance if a

doctor has said that they do not require one. However, we do require more information if their circumstances have changed. If there are changes to that, then we will front up to them, and we will make sure that those changes and those people are treated fairly.

]KiwiSaver—Disclosure Rules

12. MARK MITCHELL (National—Rodney) to the Minister of Commerce: What progress has the Government made on the introduction of new KiwiSaver periodic disclosure rules?

Hon CRAIG FOSS (Minister of Commerce): New disclosure rules that give New Zealanders better information to compare KiwiSaver funds came into force on 1 July this year, and the first statements under the new rules were recently published online by KiwiSaver providers. These changes allow KiwiSaver members to directly and easily compare funds and make more informed investment decisions. The new rules are part of the Government’s Business Growth Agenda to promote the confidence of investors and businesses in the regulatory settings that support New Zealand’s capital markets.

Mark Mitchell: How will this information help mum and dad investors?

Hon CRAIG FOSS: Mum and dad investors will enjoy the new reporting requirements that give New Zealanders more information to make informed decisions about the appropriate KiwiSaver fund for themselves. The providers must publish quarterly and annual disclosure statements online. Other organisations will also be able to compile the information now being made available. For example, the Commission for Financial Literacy and Retirement Income will shortly release a new online tool that enables members to compare KiwiSaver funds’ fees and returns, to get their retirement circumstances sorted.


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