Questions and Answers – November 21

Press Release – Office of the Clerk

1. Hon PHIL HEATLEY (NationalWhangarei) to the Minister of Finance : What reports has he received on the economyand especially on further signs of economic momentum in the regions and among manufacturers?


1. Hon PHIL HEATLEY (National—Whangarei) to the Minister of Finance: What reports has he received on the economy—and especially on further signs of economic momentum in the regions and among manufacturers?

Hon STEVEN JOYCE (Associate Minister of Finance) on behalf of the Minister of Finance: The Minister of Finance has received a number of positive reports providing strong evidence of good momentum in the economy and of improving confidence. This is happening right across New Zealand, but particularly in the regions and, as it turns out, especially in manufacturing. New Zealand’s healthy economy momentum is being recognised by respected international organisations such as the OECD, which forecast that New Zealand will be among the strongest developed economies in the world next year, with 3.6 percent growth. The Government is supporting these positive developments through its economic programme and especially through the Business Growth Agenda, which is focusing on creating the conditions for businesses to invest, grow, and create new jobs.

Hon Phil Heatley: What recent reports has he received confirming that the manufacturing sector is in good heart following a crisis that the sector was in in the mid-2000s?

Hon STEVEN JOYCE: The Minister has received the BNZ-Business New Zealand Performance of Manufacturing Index for October. The index increased 1.5 points further in October, to 55.7. The manufacturing sector has now been expanding for 11 consecutive months, and this particular reading was the highest October reading since 2007. The index has, actually, averaged 56 since the start of 2013, which is very high by world standards. Interestingly, it is not just manufacturing; the BNZ-Business New Zealand Performance of Services Index is also at its highest level of activity since November 2007. The contrast between the Performance of Manufacturing Index now and the index in 2008, when it had readings down to 35, shows that the manufacturing sector then was truly in a crisis.

Hon Phil Heatley: Has he received any recent reports confirming that regional New Zealand is leading the economic recovery?

Hon STEVEN JOYCE: This week the Minister received the ANZ Regional Trends survey. It reported that 12 of the 14 regions reported a lift in economic activity in the September quarter, led by Taranaki, which has the benefit, of course, of a vibrant oil and gas industry and also a dairy industry. Year-on-year economic growth accelerated in all but one region, and overall growth was the strongest reported since December 2004. It is great to see that Canterbury grew at 6.2 percent in the past year, which, of course, was the strongest in New Zealand. The Opposition failed at talking down the overall economy, and it has failed at taking down the regions as well. In fact, the regions are lifting New Zealand out of the global financial crisis.

Hon Phil Heatley: How is New Zealand’s good economic momentum, particularly in the regions and especially in manufacturing, translating into more jobs?

Hon STEVEN JOYCE: There are good signs that the economic momentum is translating into more jobs. For example, the latest household labour force survey showed that employment was up 1.2 percent, or 27,000 people, in the September quarter. There were 53,000 more people in work compared with a year earlier. This is despite previous false declarations by some people that there have been crises in manufacturing and crises in the regions, and so on. I encourage those two groups to declare a crisis in some other part of the economy, as there seems to be a direct inverse correlation between those that declare a crisis and a subsequent resurgence in the sector that they have declared to be in crisis.

State-owned Assets, Sales—Revenue

2. Dr RUSSEL NORMAN (Co-Leader—Green) to the Minister of Finance: How much did the Government’s share sales in Mighty River Power, Meridian, and Air New Zealand raise, given that the Supplement to the 2010 Investment Statement of the Government of New Zealand projected that those sales would raise $5.18 billion?

Hon STEVEN JOYCE (Associate Minister of Finance) on behalf of the Minister of Finance: The potential proceeds the member quotes were based on estimated commercial values of the companies at that time. They were one of a number of estimates by the board and Treasury, but they were not market valuations, because, of course, there was no market on which to value the companies. There was only a market valuation for Air New Zealand because it was already listed on the sharemarket. The share programme has confirmed what the actual market values of these companies are. They take into account all sorts of factors, including a proposal to nationalise the electricity sector using a model found in only one other country. So, in answer to the member’s question, the partial share sales have so far raised almost $4 billion for taxpayers.

Dr Russel Norman: Given that the sales have so far raised almost $4 billion, whereas they were valued at $5.2 billion, is he satisfied with his performance as finance Minister given that he has lost $1.2 billion of public wealth with his failed asset sales programme?

Hon STEVEN JOYCE: I find it very hard to take from that member his criticism of the Government’s proceeds from the asset sales, when he was doing his absolute level best through most of the year to scare investors away from the power companies, of which there have been two that have been floated. You cannot sit there in the Greens and say you are working to sabotage the float, and then turn round and say the value is not high enough.

Dr Russel Norman: I raise a point of order, Mr Speaker. I asked whether he was satisfied with his performance—

Mr SPEAKER: Order! The member not only asked that; he then, effectively, said that the Minister was responsible for the loss of the $1.2 billion. If the member wants a simple question answered, I would advise him to ask that clear and simple question, and then I can assist him. But, in this case, the Minister has addressed the question.

Dr Russel Norman: Well, does the Minister think he is in any position to lecture the Greens in this House on prudent economic management, when not only—[Interruption]

Mr SPEAKER: Order! Allow the member to finish his question.

Dr Russel Norman: Does he think he is in any position to lecture the House on prudent economic management, when not only did he lose $1.2 billion of taxpayer money on the asset sales so far but the assets sales process has cost more than a quarter of a billion dollars—money that went to brokers, lawyers, and admen when it should have gone to schools, hospitals, and good housing for New Zealand families?

Mr SPEAKER: The Hon Steven Joyce—as far as there is ministerial responsibility.

Hon STEVEN JOYCE: I disagree completely with the two suppositions tacked on to the member’s question. I agree, yes, definitely, with the member’s question, and the Green Party proves the quality of the Government’s economic management every day.

Dr Russel Norman: What does he say to the New Zealanders who believed his spin and believed the $8 million taxpayer-funded ad campaign and bought into these companies, given that the value of the shares bought by retail investors has fallen by $150 million so far?

Hon STEVEN JOYCE: The member needs to decide which line he is running here: either the shares have been sold to National’s greedy mates and they deserve everything that is coming to them, or they have been sold to mum and dad investors who are losing out. The whole concept is ludicrous. He has actually been complaining that investors would sell them on for a quick buck. The reality is that most investors are still holding the shares, and they have not lost any value, because they have not sold them.

Dr Russel Norman: What is his answer to the question raised today in the Dominion Post by Vernon Small regarding the failed asset sales programme, who said “Why did the Government ever waste so much effort on something so unpopular that would make so little difference to the economy?”

Hon STEVEN JOYCE: I am happy to give a very clear answer to that question. The Government bothered for three reasons: first, to get those companies on the sharemarket so they could be properly analysed and properly supervised by a market economy; two, to give the opportunity for the market to grow and more opportunities for investors in shares in the New Zealand economy, and the New Zealand sharemarket has been boosted through this process; and, third, to, so far, save the Government from borrowing $4 billion—$4 billion—that it would otherwise have had to borrow on the world stage. If the member thinks it is so wrong, I invite him to go out and declare transparently, as this Government did, that the Greens would borrow $4 billion and buy the shares back.

Dr Russel Norman: Is Brian Gaynor correct in the New Zealand Herald when, arguing about the failed asset sale programme and the Government’s economic management, he said: “Investors are now realising that there are huge risks associated with the current Administration because it doesn’t appear to have anyone at the helm steering a straight and consistent course as far as major business decisions are concerned.”?

Hon STEVEN JOYCE: No, and if Mr Gaynor wanted to see a contrast between a Government that knows how to run an economy and one that does not, then he should vote for the Greens at the next election and see what he could really wish for.

Dr Russel Norman: Are the market rumours that are circulating at the moment true, that the Government is going to back away from the Genesis sale given the complete failure of the asset sales programme so far, or is National determined to sell the assets regardless?

Hon STEVEN JOYCE: Nobody takes the Greens seriously with their views on the share sales, because they have a doctrinaire opposition to them. The reality is that the share sales have been a success. They have saved New Zealand taxpayers $3.9 billion that otherwise would have had to be borrowed on world markets, and the Opposition members, if they really have a conviction on this, should get out there today and promise to buy the shares back.

Dr Russel Norman: I raise a point of order, Mr Speaker. It was a pretty direct question about—

Mr SPEAKER: I invite the member to ask his question again.

Dr Russel Norman: Are the market rumours true that the Government is going to back away from the Genesis sale given the failure of the asset sales programme so far, or is National determined to proceed regardless?

Hon STEVEN JOYCE: I was disagreeing with the proposition contained in that speech from the member. The reality is that the Government does intend to proceed with the Genesis sale and does intend to raise more money so we do not have to borrow more money on the world markets.

The public will judge the quality of New Zealand’s management of debt, and one of the things they will judge is the amount of income raised from these mixed-ownership model companies.

Accident Compensation Corporation—Investment in Energy Companies

3. Hon DAVID PARKER (Deputy Leader—Labour) to the Minister for ACC: How much did ACC invest in Pike River Coal Limited and in New Zealand Oil and Gas Limited over the last eight years, and how much has it made or lost in total on its investment in each company, taking into account share purchases, subscriptions and sales, dividends, and current share prices?

Hon JUDITH COLLINS (Minister for ACC): I am advised that the shares currently held by ACC in New Zealand Oil and Gas cost $22.4 million and have an unrealised loss of $3.9 million. Over the last 8 years it has made a realised gain, including dividend and trading income, of $8.9 million. The shares currently held by ACC in Pike River Coal Ltd cost $20.5 million and have an unrealised loss of $20.5 million. During the last year it has made a realised loss, including dividend income, of approximately $1 million. In total the net loss of the investment to date has been $16 million.

Hon David Parker: Of ACC’s $2 billion profit on investments last year, how much did ACC pay towards the court-ordered compensation that Pike River Coal, a company that ACC partly owned, has not honoured?

Hon JUDITH COLLINS: Of course, ACC had no obligation or requirement to pay that, and it was not ordered by the court to do so.

Hon David Parker: I raise a point of order, Mr Speaker. My question was not that; my question was how much has ACC, from its—

Mr SPEAKER: Order! I invite the member to ask that question again.

Hon David Parker: Of ACC’s $2 billion profit on investments last year, how much did ACC pay towards the court-ordered compensation that Pike River Coal, a company that ACC partly owned, has not honoured?

Hon JUDITH COLLINS: Exactly the same amount that the court ordered ACC to pay, which was none.

Hon David Parker: Why did ACC vote against the New Zealand Oil and Gas resolution of shareholders at the company’s recent AGM instead of voting otherwise or online or via its proxy to contribute money to Pike River families, which would have assisted in paying the compensation awarded by the courts?

Hon JUDITH COLLINS: I think I should correct the member in relation to the actual motion, which was “That the Company investigates and reports to shareholders on paying the reparation order of $3,410,000 handed down …”. It goes on to continue. ACC voted against it, I am advised, because it did not believe as a shareholder that it was sufficiently informed on all of the considerations to make a judgment as to what was the right stance for New Zealand Oil and Gas to take on that issue.

Hon David Parker: Why has ACC made no claim against the directors of Pike River Coal Ltd for ACC’s losses following the misleading statements in the Pike River prospectuses, which could have also been used by ACC to pay for compensation?

Hon JUDITH COLLINS: Could you ask the member to repeat his question, please?

Mr SPEAKER: I will certainly ask the member to repeat his question.

Hon David Parker: Why has ACC made no claim against the directors of Pike River Coal Ltd for ACC’s losses, which the Minister said is $20 million, following the clearly misleading statements in the Pike River prospectuses, which, again, could be used by ACC to pay the compensation that the miners’ families have not received?

Hon JUDITH COLLINS: That question is extremely speculative and it would be a matter for the board of ACC, not for the Minister.

Hon David Parker: Does the Minister agree that it is repugnant that ACC has done nothing to enforce its right to hold the errant directors of Pike River Coal to account, has not contributed to the court-awarded compensation, and, as one of the largest shareholders in New Zealand Oil and Gas, it voted to block that company from doing so too?

Hon JUDITH COLLINS: No, I would not call it repugnant; what I would call it is in accordance with the law, and I would also point out to that member that ACC will have, in fact, by the end of next year paid almost $5 million to the families of those who were tragically killed at Pike River. There will be, in fact, around $16 million to $20 million extra paid, and that is in addition to the massive $16 million loss in the investment, which, by the way, was commenced under a Labour Government. Ruth Dyson was the Minister.

Constitutional Review—Minister’s Statements

4. Rt Hon WINSTON PETERS (Leader—NZ First) to the Minister of Māori Affairs: Does he stand by his statement “I know Māori want to talk about the place of the Treaty of Waitangi in our constitution, and how our legal and political systems can reflect tikanga Māori.”; if so, why?

Hon CHRISTOPHER FINLAYSON (Associate Minister of Māori Affairs) on behalf of the

Minister of Māori Affairs: Yes; because that is what some folk have been saying to me over the years.

Rt Hon Winston Peters: Does he not understand that under our existing constitution and law every New Zealander has the right to practise his or her religious or cultural identity?

Hon CHRISTOPHER FINLAYSON: Yes, the Minister understands that perfectly well.

Rt Hon Winston Peters: Well, if he understands that perfectly well, is it his view that our current constitutional arrangements give every New Zealander the same status of citizenship; if so, why has he argued for a different constitutional status based on tribalism and race?

Hon CHRISTOPHER FINLAYSON: Yes, the Minister understands that equality is a fundamental, bedrock principle of our constitution. Constitutional structures evolve over time; there is no big deal in any of that.

Rt Hon Winston Peters: If there is no big deal in that, why is he arguing for our new constitution to include provisions that would be destructive of democracy—that is to say, a provision where one group of New Zealanders gain their status from being New Zealanders and another group gain their status by being members of a tribe or iwi?

Hon CHRISTOPHER FINLAYSON: The Minister’s entire life has been dedicated to equality. That is why he took such a firm stand on the hateful foreshore and seabed legislation, which denied people the right of access to the court on the basis of race and which that member supported.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. [Interruption]

Mr SPEAKER: Order! This is a point of order. It will be heard in silence.

Rt Hon Winston Peters: That was a very clear question I asked the Minister, and he has not given me any answer at all to the question I have put to him. The question is simply this: why—

Mr SPEAKER: Order! No, I heard the question, and in my opinion the member addressed that question. The way forward is not to raise a point of order with the Speaker. The way forward is to use a further, incisive supplementary question to try to get the answer that the member wants.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. The way forward is not as you suggest, because we have only a limited number of supplementary questions. We well know that.

Mr SPEAKER: Order! How many supplementary questions has the member got left now?

Rt Hon Winston Peters: We have only—

Mr SPEAKER: He has two left, so I suggest he uses them quickly, otherwise we will move to the next question.

Rt Hon Winston Peters: Well, I will ask the same question again, one more time, and hope for an answer. Why is he arguing for our new constitution to include provisions that would be destructive of democracy—that is to say, a provision where one group of New Zealanders gains

their status from being New Zealanders and the other group gains their status by being members of a tribe or iwi?

Hon CHRISTOPHER FINLAYSON: I am not arguing for anything that would be destructive of that constitutional bedrock principle of equality before the law. Indeed, my entire life has been dedicated to making sure all New Zealanders are equal before the law, including Māori, who were denied the right to go to court in an endeavour to prove that they had a customary title because they were Māori, something I found utterly repugnant. I pay tribute to that outstanding member, Tariana Turia, who worked with me to ensure that that disgusting legislation was repealed. [Interruption]

Mr SPEAKER: Order! There is a supplementary question. [Interruption] Order! I am just trying to get the House a bit quieter for the member.

Rt Hon Winston Peters: If that customary title legislation was so disgusting to Māori, why did every coastal Māori tribe back it, unlike what the Minister has just said? More important, are we to have now a Parliament that is sovereign, or are we to have both a Parliament and a Treaty partner, which means we have two sovereigns?

Mr SPEAKER: The Hon Chris Finlayson, in answer to either of those two questions.

Hon CHRISTOPHER FINLAYSON: I will endeavour to answer those manifold questions. The first is that not every coastal iwi supported that disgusting legislation at all. The second point is that there is no issue about parliamentary sovereignty, and the member, as usual, is chasing moonbeams.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. Whether you are aware of it or not, there is a constitutional review going on now where precisely that is being argued—

Mr SPEAKER: Order! [Interruption] No, what we are getting here is a relitigation of the answer that has been given, by way of point of order. That leads to disorder. If the member wants to raise a point of order, he should raise it quickly and refer to the particular Standing Order, and I will attempt to help the member.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. The Standing Order is known to all of us. It is that the answer to the question be direct to the question that you were given.

Mr SPEAKER: Order! Now the member can resume his seat. That is exactly the point that I made. The member is now relitigating the answer because it is not to the standard the member wants. The member, in my opinion, addressed very adequately the question that was asked by the member.

Finance, Associate Minister—Performance

5. Hon SHANE JONES (Labour) to the Associate Minister of Finance: Is he satisfied with his performance in regard to his delegations as Associate Minister of Finance?

Hon STEVEN JOYCE (Associate Minister of Finance): Firstly, can I say that I am surprised to see the member here today. I thought he would be down with—

Mr SPEAKER: Order! The start to that answer is just not going to help the order of this House at all. Would the Minister stand and answer the question that has been asked.

Hon STEVEN JOYCE: Well, Mr Speaker. [Interruption]

Mr SPEAKER: Order!

Hon STEVEN JOYCE: That question is for the Prime Minister to judge, not me. It is perhaps worth noting, though, that in 5 years in the role this is the first time this portfolio has attracted a question in the House from the Opposition, which perhaps suggests it has not seen too much to concern it over that period.

Hon Shane Jones: Given that answer and the fact that he is directly responsible for the events that have led to the precarious financial position of Chorus, as outlined in delegations transferred to this Associate Minister, will he take responsibility for the catastrophic failure of Chorus, for its $500 million write-down? He is not so smug now.

Hon STEVEN JOYCE: Again, I think the Opposition needs to line up its attack on this particular question, because Opposition members are sitting there saying that the Prime Minister was wrong to say that the Commerce Commission would place the company at risk and now they seem to be suggesting that it does place the company at risk. This is a serious issue. The reality is that Chorus was relying on a certain amount of income from copper broadband to help pay for its share of ultra-fast broadband. The Commerce Commission has made a determination that will at least partially remove that income and some of the money that Chorus was relying on, and that may lead to price reductions or it may not. The Government has sought an independent assessment of the financial position of Chorus. Once that assessment is received, we will work through the options to ensure that ultra-fast broadband is completed and done so at a very fair cost to taxpayers.

Hon Shane Jones: Explaining is losing.

Mr SPEAKER: Order!

Hon Shane Jones: Sorry?

Mr SPEAKER: If the member wants to continue with a line of supplementary questions, I invite him to do so, but if he is going to make an interjection like that again, we will just move to the next question.

Hon Shane Jones: Does he agree that he should no longer have delegated responsibility for Chorus Ltd as Associate Minister of Finance, but should have in fact have responsibility for Chorus as Minister for Small Business, given that that is what it has become under his watch?

Hon STEVEN JOYCE: Again, I can only marvel at the gymnastics of the Opposition, which is one minute telling the Government that there is no problem that needs to be solved, and the next minute it is saying that there is a problem that needs to be solved. It is just playing politics. This Government’s ultra-fast broadband project is seen worldwide as a success. There is an issue to be dealt with. The Government will deal with this issue responsibly, and the Opposition will carp no matter what the solution is.

Hon Shane Jones: Given his close history with this issue and obvious responsibility for the fundamental failure of Chorus, did it occur to him that he was fouling the reputation of Sue Sheldon, the current chair of Chorus—apparently a paragon of audit and risk—and given the fact that she, in her dealings with him, has presided over a $500 million loss, does he not agree that she has no option but to resign today as the deputy chair of the Reserve Bank?

Hon STEVEN JOYCE: I am sorry, but it is very hard to take that question remotely seriously, because the reality of the situation is that the Commerce Commission has come up with a determination that is going to create some issues for that company. Those issues are being worked through in a responsible way. The Government is seeking advice in terms of its contract with that company. That is being dealt with absolutely correctly. Again, I have to say that the Opposition needs to decide what its view is on this matter, because that member is disagreeing with his leader, who is criticising the Prime Minister for saying there was a problem.

Hon Shane Jones: Given that answer and the advice he is taking on the contract of Chorus, and the prospect of that contract being rewritten, does he not agree that he provides a precedent for the Green Party to rewrite the contract of Skycity?

Hon STEVEN JOYCE: Oh, dear.

Hon Gerry Brownlee: Two and two equals seven.

Hon STEVEN JOYCE: Yes, I think that is it. Two plus two equals 45 in Shane Jones’ world.

Mr SPEAKER: Order! Just address the question.

Hon STEVEN JOYCE: I thought he was once a Labour leadership contender. I reject completely the member’s question. It is on another planet.

Hon Shane Jones: I raise a point of order, Mr Speaker. When you measure the level of admonition from one side of the House to the other, it is necessary for you, as we take leave next week, to take account of the fact that that side gets a lot of leeway from you and you are constantly threatening to throw—

Mr SPEAKER: Order!

Hon Shane Jones: —this side of the House out.

Mr SPEAKER: Order! Would the member please resume his seat. I have some sympathy for the point the member is raising. The question asked was a very loaded question. The Minister does not help the order of the House and on two occasions I have had to ask him to desist. He does not help the order of the House by answering a question with those sorts of initial comments. I do ask the Minister to do so. My alternative is simply to ask the Minister to leave the Chamber. I do not think that is warranted at this stage, but I will warn Ministers that if they continue to do that, they leave me no option but to then ask Ministers to leave the House.

Grant Robertson: I raise a point of order, Mr Speaker. I am not in any way challenging the ruling that you have made, but I want to make clear that on this side of the House you have rightly, in the terms of the strict Standing Orders, admonished people on this side of the House and clearly said to them that the next time they do it they will leave the Chamber. Our concern is that Mr Joyce, particularly, in virtually every answer breaches the Standing Orders and we would ask that he is held to the same standard.

Mr SPEAKER: I will hear from the Hon Steven Joyce.

Hon Steven Joyce: I understood that the convention was that if it was a politically loaded question, the Minister in response had the possibility of providing a political response. I have been very careful whenever I receive a question that is one that is not politically loaded to respond to the question. I think my history in this House demonstrates that. But when it is political—

Mr SPEAKER: Order! I have heard enough and I can help the Minister with his question. If a politically loaded question is asked, then members who ask such a question can expect an answer back. But it is totally unhelpful for the Minister to initiate his answer with some almost throwaway comment to members on the other side, and that is what they are objecting to. To the point raised—

Hon Gerry Brownlee: Well—

Mr SPEAKER: Order! To the point raised by Grant Robertson, I say that I do not want to make a habit of asking members to leave the House. I attempt to give very clear warning to members before I ask them to leave this House. On this occasion I have given a very clear warning—

Hon Shane Jones: About time.

Mr SPEAKER: Order! I have given a very clear warning that if Ministers continue to ignore an instruction that has been given from the Chair, then they can expect the same sort of treatment in being asked to leave the House.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. I would invite you to go back into your ruling and to look very carefully at the question that Shane Jones asked. Although it was asked with some flourish, it was essentially a straight question as to whether someone who had made a loss of $500 million was—

Mr SPEAKER: I do not need any more—

Hon Trevor Mallard: —a suitable person to be—

Mr SPEAKER: Order! The member, I think, has answered his own point of order. When a question is asked with some flourish—I think that was the word he used—then it does not become a clear, precise, perceptive question. If it is asked in that way, loaded with some political connotations, then that is the answer that members can expect back.

Building and Construction Industry—Reports

6. JONATHAN YOUNG (National—New Plymouth) to the Minister for Building and

Construction: What reports has he received regarding the state of the building and construction sector?

Hon MAURICE WILLIAMSON (Minister for Building and Construction): The Government yesterday released the construction sector report, which provides what I think is a very comprehensive report card on the state of the sector, and I would ask all members of this House to

have a good read of it. The report will support the Government’s Business Growth Agenda by improving understanding of the economy. Currently, the sector employs 170,000 people and generates revenues of around $30 billion per annum. The report highlights the huge wave of work that is coming in this country, with the peak expected to occur in 2016. The sector needs to be ready to ride this wave and make sure it has a skilled workforce to cope with such a tidal wave.

Jonathan Young: What is the Government doing to support the sector to prepare for this boom in construction activity?

Hon MAURICE WILLIAMSON: We recognise that with all the work that is coming in Christchurch, Auckland, and the regions it is vital to have as many skilled workers as possible. That is where the apprenticeship reboot scheme comes in. Already, more than 8,000 people this year have signed up for a trade. It has indeed been a huge success. Yesterday the Minister for Tertiary Education, Skills and Employment, Steven Joyce, announced that the Wellington Institute of Technology and Whitireia Community Polytechnic will invest $13 million in a new Regional School of Construction for Wellington. The Government is also improving the professionalism in the sector through the licensed building practitioner scheme, for which we now have 23,500 licensed practitioners. Other moves to cut red tape involve introducing risk-based consenting, the uptake of building information modelling, and the development of a national online consenting system, which will all add to the productivity of the sector.

Oil and Gas Exploration—Assessment of Anadarko’s Risk Management Plans

7. GARETH HUGHES (Green) to the Minister for the Environment: Did the Environmental Protection Authority assess the full version of Anadarko’s Discharge Management Plan and Emergency Response Plan as part of its evaluation of the company’s Environmental Impact Assessment for the Deepwater Taranaki Well; if not, why not?

Hon AMY ADAMS (Minister for the Environment): Under the transitional provisions within the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act, which are in effect until July 2014 and which apply to the application in question, the Environmental Protection Authority is required to assess only the completeness of the impact assessment, as set out in section 39, not make a finding on its effectiveness. I note that the Environmental Protection Authority is an independent agency that operates at arm’s length from Ministers and, therefore, this matter is entirely operational for the authority. However, I am advised by the authority that although it did not see the version of the discharge management plan that was finally approved by Maritime New Zealand, it does consider that it received sufficient information to satisfy its obligations under section 39 as they apply during the transitional period.

Gareth Hughes: Is the Minister for the Environment satisfied that the Environmental Protection Authority has done its job, when it has signed off on Anadarko’s well without having the full facts in front of it about potential environmental effects from a spill?

Hon AMY ADAMS: As the Minister for the Environment, it is not my job to second-guess the independent decisions of the Environmental Protection Authority. But, as I pointed out in my answer to the primary question, it is not the job of the authority while in the transitional period to approve the impact assessment; it is its job to receive and ensure that it is completed. That is very clearly what the legislation says.

Gareth Hughes: Given that legal doubts have been raised, is she confident that the Environmental Protection Authority has fulfilled its statutory obligation to determine that Anadarko’s environmental impact assessment was complete, given that it saw only summaries of Anadarko’s oil spill modelling and emergency response plan?

Hon AMY ADAMS: I can advise the member that the Environmental Protection Authority has confirmed to me that it considers it has met its statutory obligations.

Gareth Hughes: Has not only the Government kept the public in the dark by suppressing these documents but also the Environmental Protection Authority has kept itself in the dark by not

seeking and seeing full versions of Anadarko’s oil spill response plans, before giving approval to drill the deepest-ever well in New Zealand’s waters?

Hon AMY ADAMS: I can only repeat what I said to the member in response to the earlier questions. The Environmental Protection Authority’s obligation during the transitional period is to be satisfied that it has received a complete impact assessment under section 39 of the Act. The advice it has given me is that it is confident that it has received that.

Moana Mackey: Is it still her assertion that deep-sea drilling can be done safely by Anadarko off the coasts of Taranaki and Kaikōura because we have been drilling offshore in Taranaki for decades with no problems, when advice she received a year ago shows that the risk of a reportable incident each year increases from 10 percent at depths that we have drilled in so far to 70 percent at the new deep-water depths proposed for off the coast of Kaikōura?

Hon AMY ADAMS: Yes. It is my view that it can be undertaken safely. That is not to say that there are not risks; of course there are risks, and, yes, risks do increase as you get deeper. We have always been clear about that. But let me be really clear about this: the 70 percent figure, which Mr Cunliffe is toting around the country and whipping up unjustified concern about, is the risk of a reported incident—a reported incident. That includes property damage, it includes accident or injury to workers, and it includes days of being shut down. It is not the indication of a likely oil spill. In fact, the best international information that I have seen tells us that the average rate of spill for deep-water, offshore wells is 2.54 per 1,000 wells, and most of those spills are minor and contained.

State-owned Assets, Sales—Air New Zealand

8. Hon CLAYTON COSGROVE (Labour) to the Minister of Finance: When, if at all, did Cabinet approve the timing of the Air New Zealand sell-down and what directions did Cabinet give the shareholding Ministers?

Hon STEVEN JOYCE (Associate Minister of Finance) on behalf of the Minister of Finance: In December 2011 Cabinet confirmed that the Crown would sell down its shareholding as part of the mixed-ownership programme announced nearly a year earlier. On 2 September 2013 Cabinet authorised joint Ministers, comprising the Prime Minister, the Minister of Finance, Associate Minister of Finance Steven Joyce, and the Minister for State Owned Enterprises, to determine the final timing of the transaction. Under this authorisation the joint Ministers made the final decision on the timing of the transaction on Friday, 15 November, subject to the appointment of joint lead managers and determining the transaction’s structure. The Air New Zealand sell-down occurred on 19 November and was highly successful.

Hon Clayton Cosgrove: Why was formal approval not sought for the timing of the transaction, worth hundreds of millions of dollars, or was it a case of Mr English having a drink on the Friday night and deciding to flog them off? [Interruption]

Mr SPEAKER: Order! I am going to ask the member to ask that member again, but the last bit just does not help the order of the House. If we could just have the factual question, I think the member stands a far better chance of getting an answer.

Hon Clayton Cosgrove: To the Minister—[Interruption]

Mr SPEAKER: Order! [Interruption] Order!

Hon Clayton Cosgrove: Sensitive. Why was formal Cabinet approval not sought for the timing of a transaction worth hundreds of millions of dollars, or is it the case that Minister English, on Friday night, decided to flog the shares off?

Mr SPEAKER: It is not greatly improved by that, but anyway, the Hon Steven Joyce.

Hon STEVEN JOYCE: The member was simply not listening to the first answer to the question. I invite him to do so, because the idea of having supplementary questions is that you expand on the answer to the first question. The key point is that Cabinet approved the transaction taking place, but the timing of the transaction was actually delegated to joint Ministers: the Prime Minister, the Minister of Finance, the Associate Minister of Finance Steven Joyce, and the Minister

for State Owned Enterprises. Ministers took the decision after 5 p.m. on the Friday to make the decision to proceed.

Hon Clayton Cosgrove: Given his answer yesterday in this House that he would not have to go “crawling to foreign bankers” to fund debt, could he please explain whom he is borrowing the current $424 million per month from?

Mr SPEAKER: Hon Steven Joyce, in so far as it is related to the Minister of Finance.

Hon STEVEN JOYCE: I look at the primary question—and I appreciate that the member has run out of supplementary questions because I have answered the question—and, actually, the debt question has got nothing to do with the primary question.

Mr SPEAKER: And I am certainly going to accept that as an answer.

Hon Clayton Cosgrove: With regard to the Air New Zealand sell-down, has he seen the statement of a sharebroker published in the Christchurch Press today, who describes the sell-down of Air New Zealand as “What another bloody debacle”—and forgive the invective, Mr Speaker, but it is a direct quote—if so, does he now acknowledge that, along with Kiwi mums and dads, the big end of town also believes that he has stuffed this transaction up?

Hon STEVEN JOYCE: The Labour Party—the party of stockbrokers. That is what we have now. Again, the member needs to make up his mind. Either we are making too much money or not enough money, but he needs to stop actually arguing it around. The reason I am answering in this way, Mr Speaker, is that you heard the question.

Hon Clayton Cosgrove: How will he make up the shortfall of his asset sales target? Will he forgo building the mythical schools and hospitals he promised, or will he go “crawling to foreign bankers” to borrow the money to make up the shortfall?

Hon STEVEN JOYCE: The reality is the Government has a net Crown debt of $60 billion. If we did not do these sales, that number would be $4 billion higher now, and then $5 billion higher. The question, actually, for the Opposition is: are those members promising to borrow the money to buy the shares back? If not, the rest of it is all wind.

Christchurch, Recovery—Repair and Rebuilding of Housing

9. NICKY WAGNER (National—Christchurch Central) to the Minister of Housing: What steps is the Government taking to rebuild Christchurch’s housing stock damaged or destroyed by the earthquakes?

Hon Dr NICK SMITH (Minister of Housing): The Government is committed to a programme of having all 5,000 damaged Housing New Zealand homes repaired and 700 new homes built, or the equivalent of one a day, by the end of 2015, and we are making good progress. Today I turned the first sod on a new $9 million, 26-unit development on Manchester Street, where six old, damp State houses previously stood. Eleven of the new 26 homes will be retained by Housing New Zealand and the remainder will be sold on the private market. This approach of increasing the density of housing in the central city and moving to mixed housing developments of social and private housing is part of our vision for Christchurch’s future.

Nicky Wagner: How is the Government addressing the housing problems of the people of Christchurch with mental health needs, given the stresses this community has been through and the escalating costs of housing from the thousands of homes damaged by the earthquakes?

Hon Dr NICK SMITH: The Government has partnered with Comcare Trust, a specialist community housing provider for people with high needs, and has provided funding of $4.1 million to expanding its housing portfolio by 45 homes. We opened the first six of these in St Albans today. These tenants have complex needs that are better met by a specialist community housing provider like Comcare Trust. This initiative is a flagship of our social housing reforms, underpinned by new legislation that was passed unanimously by Parliament yesterday.

Phil Twyford: Does he agree with the Christchurch City Council that there is severe stress on the housing stock, or does he agree with Gerry Brownlee, who says it is just a housing pinch; and

after 5 years in Government and 3 years since the quakes, is it not about time he sorted out his failed housing policy?

Hon Dr NICK SMITH: I would much rather be focused on building a house a day and rebuilding those 5,000 houses that were damaged by the earthquakes, than have an argument that the Opposition seems to be focused on as to whether it is a housing challenge, a housing crisis, or a pinch, which are the sorts of word games that get families nowhere.

Meat Industry—Development

10. Hon DAMIEN O’CONNOR (Labour—West Coast – Tasman) to the Minister for

Primary Industries: Does he stand by his statement “The opportunity, and challenge, for our meat producers now is to add value to different cuts of meat and continue to sell the New Zealand story”; if so, why?

Hon NATHAN GUY (Minister for Primary Industries): Yes. This Government has a goal of doubling our primary sector exports by 2025. I have just returned from a very successful trade mission with the Prime Minister to Thailand to support this goal. To reach this goal we will also need to continue adding value to what we sell overseas. That is why the Government and the industry have jointly committed $684 million in funding for the Primary Growth Partnership. If successful, these programmes could add around $7 billion per year to our economy by 2025. Almost half of these projects are in the red meat sector, including innovative programmes such as FarmIQ; the new Silere merino meat brand, which was a hit at the America’s Cup; and the marbled grass-fed beef project. Change, of course, does not happen overnight, but Labour did nothing in—

Mr SPEAKER: Order! That answer is now long enough.

Hon Damien O’Connor: Does the Minister consider his investment of half a million dollars in the Red Meat Sector Strategy and the $350 million of taxpayer and farmer money in Primary Growth Partnership meat projects to be a good investment, given that the Auditor-General is currently investigating each and every one of these projects?

Hon NATHAN GUY: The member’s figures are inaccurate. They are not correct. The Government is investing just over $161 million in the red meat sector in very important, innovative projects. I am relaxed about the Auditor-General having a look at these projects, because there is very robust auditing already put in place by the Ministry for Primary Industries and external audits.

Hon Damien O’Connor: How can the Minister justify his commitment to an $87 million Primary Growth Partnership project with ANZCO Foods, a Japanese company that is so far not accountable for the money spent, when the project to add value to meat carcasses is simply, in the company’s own words, “business as usual”?

Hon NATHAN GUY: No, I disagree with that. There are robust auditing processes under way. There are quarterly reports. The information is available on the Ministry for Primary Industries’ website. The member needs to understand that these are long-run projects. These are long-run projects, and we are working very closely with the industry to return more money to the industry and to support our farmers. Labour does not care about our farmers and our rural communities.

Hon Damien O’Connor: I seek leave to table an email from the Ministry for Primary Industries apologising once again—

Mr SPEAKER: Order! Just describe the email precisely.

Hon Damien O’Connor: The email is from the Ministry for Primary Industries, apologising for not being able to deliver on time its obligation to an Official Information Act request for details on these—

Mr SPEAKER: Order! And the email is presumably to the member?

Hon Damien O’Connor: Yes, it is.

Mr SPEAKER: And the date?

Hon Damien O’Connor: It is to our—

Mr SPEAKER: And the date?

Hon Damien O’Connor: It is to our research unit, and it is detailed 18—

Mr SPEAKER: The easiest way is for me to put the leave. It is over to the House to decide. Leave is sought to table this particular email to the Labour research unit. Is there any objection to it being tabled? There appears to be none. Document, by leave, laid on the Table of the House.

Hon Damien O’Connor: Does the Minister consider the $350 million – plus committed in Primary Growth Partnership meat projects to be making progress when farmers are converting land to dairying with an increasing impact on the environment, and meat carcasses are being exported to China for value-added processing while New Zealand meat workers remain unemployed?

Hon NATHAN GUY: I refute some of those comments from the member. I think he needs to check his facts before he comes into the House, because the China meat market is important to the red meat sector and to our farmers. So is the European Union, and so is the UK. Yes, there are some carcasses going there that are unprocessed, but, importantly, there is a lot of processing and a lot of value-adding that is going on to support Kiwi jobs here. Importantly, what we want to do is see greater returns flow through to farmers, and that is why the member’s party should be supporting the Primary Growth Partnership, water storage projects, and the Trans-Pacific Partnership, but it does not agree with anything.

Hon Damien O’Connor: Supplementary question. [Interruption]

Mr SPEAKER: Order! I will call the member once I can get some decorum from his own side.

Hon Damien O’Connor: Given the admission by his colleague the Hon Tim Groser that the Ministry for Primary Industries had inadequately resourced trade into the China market, does he consider the increase in staff from one to three to be sufficient to develop and protect the growing meat trade into China?

Hon NATHAN GUY: The important thing here is that the Ministry for Primary Industries is addressing the issues that came to bear with the certification, and, importantly, resources are increasing in China, from one to three. The resources are also increasing here in Wellington, in the market access team, and we are working across the whole of Government to ensure that we are supporting our exporters getting their products into the Chinese market.

Hon Damien O’Connor: I seek leave to table the Red Meat Sector Strategy Report—

Mr SPEAKER: Order! Order! The member can resume his seat. That is something that was sent to all members at the time.

Hon Damien O’Connor: I seek leave to table the Controller and Auditor-General’s annual plan—

Mr SPEAKER: Order! Order! If it is an older document, it will have been tabled in the House already.

Hon Damien O’Connor: It is this year’s document.

Mr SPEAKER: It will have been tabled in the House already.

Local Government Reforms—Financial Reporting

11. IAN McKELVIE (National—Rangitīkei) to the Minister of Local Government: How is the Government improving councils’ financial reporting?

Hon CHRIS TREMAIN (Minister of Local Government): Recently I announced the introduction of new financial prudence regulations that will tighten financial reporting, lift transparency, and encourage excellence in local government. The regulations will provide a standardised way of financial reporting, which will encourage council efficiency and improve accountability to ratepayers. In next year’s annual accounts, councils will have to report against a set of benchmarks around three key elements of financial prudence. These are affordability, sustainability, and predictability.

Ian McKelvie: How will the new financial reporting requirements ensure more transparency and encourage excellence in local government?

Hon CHRIS TREMAIN: Affordability will be measured through rates and debt information; sustainability will be measured through a balanced budget, expenditure on essential services, and debt servicing; and predictability will be measured through cash flow from operations and debt control information. Performance results will be collated in a way that recognises each individual local authority’s situation. I want to see councils measured and benchmarked against each other to help lift performance and to focus on excellence. These regulations are part of the Better Local Government reform programme, and are part of the Government’s commitment to delivering better services within tight financial constraints.

Employment Relations—Legislative Reform

12. DARIEN FENTON (Labour) to the Minister of Labour: Does he stand by his statement that “I am especially keen to hear what affected parties have to say on the Part 6A proposals in the Bill, and will carefully consider their submissions and the recommendations of the select committee”?

Hon SIMON BRIDGES (Minister of Labour): Yes, I do.

Darien Fenton: Can the workers at Hillmorton Hospital in Christchurch be confident that he has listened to their concerns given that their lives have already been turned upside down by the earthquakes and they are now sick with worry that his changes to Part 6A of the Employment Relations Act will mean they have no job security?

Hon SIMON BRIDGES: In all seriousness, they can be confident that I am listening and taking this very seriously.

Darien Fenton: Will he carefully consider the submissions of school cleaners, who told the select committee that enabling smaller, cheaper companies to clean in schools will drive down the quality of cleaning, thus putting our kids at risk of unnecessary infections?

Hon SIMON BRIDGES: It will not be possible, as the member knows, for me to read every single submission. There have been a lot. But, as she knows, I have met with a number of people, including the Service and Food Workers Union, despite harsh criticism from Whale Oil for doing that. I am taking this issue very seriously.

Darien Fenton: Given his commitment to carefully consider their recommendations, where the submissions on the bill from both employers and workers overwhelming oppose elements of his Part 6A changes, will he change them?

Hon SIMON BRIDGES: Also, as the member knows, this is a very complex issue. Really, there have been submissions going every way on every part of Part 6A. I have confidence that David Bennett and the team on that select committee will do a very good job.


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