Questions and Answers – Oct 14

Press Release – Office of the Clerk

1. CHRIS BISHOP (National) to the Minister of Finance : Does he stand by his statement that the Governments top fiscal priority is returning to surplus this year and maintaining surpluses in the future?
Questions to Ministers

Finance, Minister—Return to Surplus

1. CHRIS BISHOP (National) to the Minister of Finance : Does he stand by his statement that the Government’s top fiscal priority is “returning to surplus this year and maintaining surpluses in the future”?

Hon BILL ENGLISH (Minister of Finance): As I said in an answer to a similar question yesterday from Labour’s finance spokesman, yes, it does remain one of the Government’s top priorities. And as I said yesterday, in the sense of an economy, it does not matter that much whether there is a small surplus or a small deficit—it is the fact that Government finances are headed, broadly, in the right direction.

Chris Bishop : What reports has he received confirming that the Government has achieved its target of reaching fiscal surplus this year?

Hon BILL ENGLISH : I have seen the recently released financial statements of the Government of New Zealand for 30 June 2015, which I know all members read. Those statements confirm that the Government posted a surplus of $414 million in 2014, which means that the Government met the target it set in 2011, despite some scepticism. I want to acknowledge the efforts of my parliamentary colleagues, and also the tens of thousands of public servants, who, through the last 7 years, have produced better public services for the same or less money.

Grant Robertson : Is it correct that the financial statements that he has just referred to include an underspend in the health budget of $52 million, an underspend in the education budget of $235 million, an underspend of $96 million in the law and order budget, an underspend of $304 million in the transport and communications budget, and an underspend of $97 million in the housing and community development budget?

Hon BILL ENGLISH : Can I thank the member for his generous acknowledgment of the achievements of New Zealand’s public services. I know that as the spokesman for overspends, he finds underspends deeply offensive.

Chris Bishop : How does the surplus in 2014/15 compare with fiscal forecasts inherited by the National-led Government when it took office in 2008?

Hon BILL ENGLISH : The update of the 2008 Budget forecast a decade of deficits. The 2008 Budget forecast a small deficit, which turned out to be over $3.5 billion. If the spending track had continued, we would have had Government net debt blowing out to 60 percent of GDP. That was partly a result of the fact that under the previous Labour Government, from 2003 to 2008 Government spending increased by 50 percent, at the rate of almost $3 billion per year. For the past 7 years, it has averaged just around $600 million extra per year.

Grant Robertson : Is it correct that the last time there was 3 percent growth, which was under a Labour Government, there was a surplus of $7 billion and unemployment was under 4 percent, compared with this small surplus of just over $400 million and unemployment reaching 6 percent?

Hon BILL ENGLISH : I am happy for the member to campaign on the fiscal record of the previous Labour Government, because the three elections since showed three times what the New Zealand public thought of that fiscal record.

Grant Robertson : I raise a point of order, Mr Speaker. I asked the Minister whether the statement I made comparing those two figures was correct. I did not get an answer to that question.

Mr SPEAKER : I got an answer that satisfied me. I was very tempted to rule the question out because it was such a long question. I was very generous to the member. The question has been addressed.

Darroch Ball : Is making cancer sufferers pay for a monthly doctor’s certificate to confirm that they still have cancer one of his strategies to save money in order to get to surplus?

Hon BILL ENGLISH : I am not aware of that particular process, but I can tell the member that alongside many other strategies, one of the strategies to save money is precisely to address the long-term health and mental health needs of the 70,000 people who are on a benefit and who, under previous Governments, did not enjoy the active interest of a Government that wants to get them out of that situation and become more productive members of the community. Under our social investment approach, that is what we will be doing.

Rt Hon John Key : What previous reports has the Minister seen on the prospects of the Government achieving its surplus target this year?

Hon BILL ENGLISH : Actually, I can refer to one report from earlier this year, where a member of the House got up and said that the failure of the Government to reach a surplus was one of the biggest political deceptions in a lifetime. Actually, I think the biggest political deception was that Grant Robertson did not tell Andrew Little that it was just the forecast. Actually, the real result has come out today. It is a surplus, and it does not quite rate up there with the Watergate scandal.

Rt Hon John Key : Now that the Government is back in surplus, can I have more money for my cycleways?

Hon BILL ENGLISH : Well—[Interruption]

Mr SPEAKER : Order! I am interested in the answer.

Hon BILL ENGLISH : Like other Ministers, the Prime Minister is prone to exaggerate the benefits of the particular project and bid for more money than he actually expects to get. And because that is what he usually does, I usually say no.

Fletcher Tabuteau : What impact will an additional $160 to $200 billion of direct foreign investment by 2025, announced by Mr Joyce today, have upon the current account deficit?

Hon BILL ENGLISH : Because that investment would come only because it is productive investment that can generate a return in excess of the cost of capital, it would be positive for the current account.

Julie Anne Genter : Does the surplus of $414 million announced today mean that his Government could have ensured that every hungry child had a school lunch, giving them their best chance at a good education?

Hon BILL ENGLISH : Mr Speaker, it was a bit hard to hear. I am not sure—

Mr SPEAKER : Could I ask the member to repeat the question for the benefit of the Minister.

Julie Anne Genter : Does this year’s surplus of $414 million mean that his Government could have ensured that every hungry child had a school lunch, giving them their best chance at a good education?

Hon BILL ENGLISH : As the member will know, the surplus has arisen after the decision made by the Government to increase benefit levels for the first time in 43 years—by $25 a week for families with children, starting on 1 April 2016. We hope that it will contribute towards achieving the kinds of things that the member has mentioned. Can I also acknowledge a more sensible question than that of the Labour finance spokesperson.

Mr SPEAKER : Order! That last part is just completely unnecessary and will create disorder. Further—[Interruption] Order! I certainly do not need the assistance I am being offered from my left-hand side.

Julie Anne Genter : Could the Government have afforded an additional $11 million this year to ensure that every hungry child in New Zealand got a school lunch in addition to raising benefits?

Hon BILL ENGLISH : A Government can, of course, afford any particular decision at the margin if it thinks that it is a worthwhile and effective decision. We just do not happen to believe that the school lunch programme that the member is advocating would achieve what she says or that it is the best way to achieve it.

Julie Anne Genter : Did cutting taxes in 2010 from 38 percent to 33 percent for those earning over $70,000 a year have a positive or a negative impact on the Government’s ability to return to surplus?

Hon BILL ENGLISH : I believe that it had a positive impact, not only on our ability to achieve surplus but also on income equality across the range of incomes. Tax revenue as a proportion of GDP has risen since that time, and people on higher incomes are paying a higher proportion of the tax take than they used to. So, yes, I think that the tax package was well worthwhile and positive for the Government’s accounts.

Julie Anne Genter : Does he have specific evidence that the tax cuts for top income earners did result in more people working, a greater tax take, and greater equality in the distribution of incomes in New Zealand?

Hon BILL ENGLISH : Yes, there is evidence for those propositions. You can actually see what proportion of the tax take is paid by different income groups—that is measurable. With respect to equity, I believe that the efficiency gains from the tax changes mean that we collected more revenue, and that has enabled us to make decisions like the $25 a week for New Zealand’s lowest-income families.

Chris Bishop : What particular challenges has the Government faced in getting back to surplus, and how has the Minister managed those challenges?

Hon BILL ENGLISH : I think the two biggest challenges were the global financial crisis and the Christchurch earthquake, and in both cases, the team of Cabinet and caucus, and a large number of public servants, applied themselves to dealing with some of the more fiscally challenging times that New Zealand has seen in a long time. The good news is that the economy is growing again at a reasonable level and the costs of the Canterbury earthquake have been dealt with in a very effective and responsible manner, particularly under the charge of Minister Brownlee. We can now look ahead to setting different fiscal parameters for managing the Government’s books in better circumstances.

Julie Anne Genter : Would implementing a revenue-neutral carbon tax to put a price on pollution support his goal of maintaining surpluses in the future, cutting taxes, and future-proofing the economy?

Hon BILL ENGLISH : In concept, yes. In fact, when we set the target back in 2011, that was the expectation—that, at $12.50 per tonne, the Government would collect something like a billion dollars of revenue from the emissions trading system put in place to a large extent under the influence of the Greens. As it turned out, the oil price dropped and we collected almost nothing. But as that price rises, the Government will benefit from revenue from that scheme, which would help either to maintain surpluses or to offset other taxes.

Julie Anne Genter : Can he confirm that it is possible to invest in services to ensure that there are no kids going hungry at school, that we are reducing carbon pollution through a meaningful price on carbon, and that the books balance, but that it just has not been National’s priority?

Hon BILL ENGLISH : Yes, it is possible to do those things, and, of course, it is politically arguable which ones you actually concentrate on. With respect to children, we have not set ourselves the objective around school lunches; we have gone for other targets that we actually think are a bit more challenging, like reducing the number of assaults on children and the number of children with rheumatic fever. But the general idea of investing wisely and achieving a clear impact is one that is at the heart of the Government’s management of Government expenditure.

Grant Robertson : Is it correct that the underspend of $235 million in the education budget includes funding that was to be directed towards special education, meaning that the most vulnerable children in our system have been ripped off by this Government?

Hon BILL ENGLISH : If the member did his homework, he would know that there is a difference between an underspend and a rip off. Underspends arise when the money has been allocated—actually, in this case, to special education. For various reasons across the $70 billion, they just have not got to spending it yet. So it is not a rip-off, and the member should study the system a bit more so that he knows the difference.

Australian Detention Centres—New Zealand Citizens

2. MARAMA FOX (Co-Leader—Māori Party) to the Prime Minister : Is he concerned about the alleged human rights abuses being perpetrated on detainees in offshore processing centres in Australia; if so, what does he intend to do to seek assurances from Malcolm Turnbull that the human rights of New Zealanders who are currently detained on Christmas Island are maintained and upheld?

Rt Hon JOHN KEY (Prime Minister): If the member is referring to New Zealanders being held in immigration detention centres of which Christmas Island is one, yes I do intend to raise this with Mr Turnbull later this week. I can assure the member that if any New Zealander alleges that human rights abuses are taking place against them in an Australian detention centre, they should raise those issues with the Ministry of Foreign Affairs and Trade, and consular staff will look into it.

Marama Fox : Given that Australia has just passed legislation that effectively gags all staff, including medical personnel, from talking to the media about the conditions inside those offshore processing centres, what assurances can the Prime Minister give whānau of New Zealand citizens that their family members are free from harm and abuse?

Rt Hon JOHN KEY : An absolute assurance that if they take those matters up with Ministry of Foreign Affairs and Trade staff, then consular assistance will be provided.

Marama Fox : Will the Prime Minister apply pressure to Malcolm Turnbull and the Australian Government to ensure that New Zealand detainees are freed to their homes, as per the conditions of their parole, which have previously been determined by the Australian courts, to await their possible deportation there?

Rt Hon JOHN KEY : I have already made it publicly clear that I do not think sending New Zealanders to detention centres is our preferred option, although I will say it is a very longstanding practice of Australia to send people there. The issue here is that because of the policy change announced late last year, there is a great many more of them.

Hon Nanaia Mahuta : Does he believe that New Zealand citizens who have served their sentences being held in detention on Christmas Island, having their visas removed, and reportedly being treated badly reinforces the special relationship between Australia and New Zealand, or did Tony Abbott simply ignore his representation on the matter?

Rt Hon JOHN KEY : I do not have all of those details, but as I have said, it is a matter for anyone to raise that matter with Ministry of Foreign Affairs and Trade staff, and it will be looked at. There is also a system in place in Australia to investigate any complaints.

Social Development, Minister—Confidence

3. ANDREW LITTLE (Leader of the Opposition) to the Prime Minister : Does he have confidence in the Minister for Social Development?

Rt Hon JOHN KEY (Prime Minister): The Minister, amongst other things, is taking legislation through the House to raise benefits in real terms for the first time in 43 years. She is overseeing a major overhaul of Child, Youth and Family to ensure it delivers the best results for vulnerable children, and under her watch the number of sole parents on a benefit is now the lowest since 1988 and 42,000 fewer children are living in benefit-dependent households compared with only 3 years ago. So, yes, I have every confidence in the Minister for Social Development.

Andrew Little : How does he think someone with cancer feels when they are repeatedly asked what they are doing to find work, and repeatedly have to pay for medical certificates to get the benefit they are entitled to?

Rt Hon JOHN KEY : Firstly, we recognise that people with conditions like cancer are going through very difficult times and often cannot work, which is why they are able to go on a benefit. It has always been the case that a medical certificate has been required, and, in fact, earlier this year, actually, we made it more straightforward for medical staff—doctors—to lodge directly electronic medical certificates with Work and Income.

Andrew Little : Does he agree with the Minister that the Government cannot give cancer patients special treatment because there would be “other groups of people that would come forward and say, ‘we need special consideration too’.”?

Rt Hon JOHN KEY : The point the member was making was that if somebody is claiming this particular benefit, then it has been a longstanding practice for everybody in that position, actually, to provide a medical certificate.

Andrew Little : Would it be such a tragedy if no New Zealander with a chronic or terminal illness had to continually fill out forms and pay for medical certificates to get the help that they deserve?

Rt Hon JOHN KEY : The member does not understand the system. If someone has terminal cancer, then they are not on this particular benefit and they are not required to get a—

Hon Members : They are.

Rt Hon JOHN KEY : No, they are not required.

Andrew Little : Are he and his Government so heartless that when people are going through one of the most difficult times in their lives, all it can do is put barriers in the way of their getting the help they deserve?

Rt Hon JOHN KEY : I just reject that proposition.

Andrew Little : Does he accept that all New Zealanders can see he is prepared to respond to difficult issues affecting vulnerable people only once it hits the media?

Rt Hon JOHN KEY : No, it has been a longstanding practice to require medical certificates.

Andrew Little : Why does he not stick up for New Zealanders, just for once, and treat people who have cancer with dignity?

Rt Hon JOHN KEY : This Government does.

Darroch Ball : Does he have confidence that the Minister is addressing serious allegations of unsafe practices at the South Auckland Child, Youth and Family – run youth justice facility Korowai Manaaki?

Rt Hon JOHN KEY : I simply do not have the details of that. The member would need to refer that to the Minister.

Darroch Ball : How can he have confidence in the Minister when she states in answer to a written question that “the ministry is investigating the allegations regarding Korowai Manaaki, and any concerns are being addressed”, yet my attempt to table a document in the House detailing those allegations was blocked and there has been no further communication from the Minister to me about those allegations she purports to already be addressing?

Rt Hon JOHN KEY : Firstly, I have absolute confidence that the Minister stands by her words and follows her actions. If the member really feels strongly about the allegations he is making, he should feel free to walk outside those doors and say them. [Interruption]

Mr SPEAKER : Question—[Interruption] Order! [Interruption] Order! When I call for order I expect that, and certainly not a continued barrage, then, from one New Zealand First member of Parliament.

Economy—Investment and Growth

4. JAMI-LEE ROSS (National—Botany) to the Minister for Economic Development : What is the Government doing to encourage investment and growth in the New Zealand economy?

Hon STEVEN JOYCE (Minister for Economic Development): This morning I released the updated chapter of the building investment work stream of the Government’s Business Growth Agenda. Attracting high-quality business investment into all parts of New Zealand is critical to strengthening our growth rate and lifting productivity, and it is an essential ingredient for building an innovative and connected economy. The investment chapter has a range of projects to ensure that New Zealand has the right conditions to encourage more business investment, and builds on recent work to ensure New Zealand has robust financial market regulation to support domestic capital growth and investor confidence. Although capital inputs into our tradable sectors have grown around 2.5 percent for the last couple of years, we need to lift that to around 4-5 percent per year to achieve the level of export growth we are targeting in the Business Growth Agenda.

Jami-Lee Ross : What work is under way to encourage more investment in New Zealand?

Hon STEVEN JOYCE : The building investment report sets out eight new projects alongside 23 that are currently under way and the 36 that have been completed since 2012. One of the Government’s priorities is, of course, to rebuild the Government’s balance sheet, which we are achieving under the excellent fiscal stewardship of our Minister of Finance. We are working very hard to encourage more investment in all parts of New Zealand through the roll-out of the new Investment Attraction Strategy, the details of which were announced today, and regional investment profiles. We are increasing international linkages to encourage more foreign investment through agreements like the Korean free-trade agreement and the Trans-Pacific Partnership.

Jami-Lee Ross : What else is the Government doing to encourage more investment, jobs, and growth in the New Zealand economy?

Hon STEVEN JOYCE : Just last week, alongside Amy Adams and Paul Goldsmith, we released the building innovation Business Growth Agenda chapter, outlining the Government’s strategy for developing New Zealand into a hub for high-value, knowledge-intensive businesses. That included an ambitious new target of peak rural broadband speeds of at least 50 megabits per second by 2025, with 99 percent of New Zealanders able to access broadband at that speed, with the remaining 1 percent able to access up to 10 megabits per second, up from dial-up or non-existent speeds when we came into office. Last month Tim Groser and I released the building exports chapter of the Business Growth Agenda, the Government’s strategy for strengthening trade relationships with all our key trading partners. Of course, that one included as an initiative the Trans-Pacific Partnership, which has now been signed. The building exports report positions this Government, like other National and, indeed, Labour Governments before it, as unashamedly supportive of free trade.

David Seymour : Would it not be cheaper, quicker, and easier to simply stop chilling the confidence of foreign investment with arbitrary decisions at the end of the Overseas Investment Office process such as that applied to the Lochinver Station sale?

Hon STEVEN JOYCE : I think the member will find, if he looks into it, that he is incorrect.

David Seymour : Supplementary question.

Mr SPEAKER : No, the member has had two supplementary questions this week.

Trans-Pacific Partnership—Minister of Health’s Statements

5. Hon ANNETTE KING (Deputy Leader—Labour) to the Minister of Health : Does he stand by all his statements relating to the Trans-Pacific Partnership agreement?

Hon Dr JONATHAN COLEMAN (Minister of Health): Yes, in particular my statement that Labour needs to decide whether it supports the Trans-Pacific Partnership or not and that Annette King should apologise for her scaremongering that people would die because of the Trans-Pacific Partnership—absolutely outrageous.

Hon Annette King : Supplementary question—[Interruption] The only people who need to apologise sit over there.

Mr SPEAKER : Order! The interjections were certainly not helpful. I invite the member to continue her line of questions.

Hon Annette King : Will Pharmac under the Trans-Pacific Partnership agreement be required to allow the pharmaceutical industry to use evergreening patents—secondary patents held by the owner of the original patent—which extend monopoly periods for medicines?

Hon Dr JONATHAN COLEMAN : All I can say is that there will be no change to our policy settings and therefore no increased costs. [Interruption]

Hon Annette King : Mr Speaker, I did not hear it.

Mr SPEAKER : I am going to invite the member to ask the question again, and then I am going to ask quite strongly that the interjection level from the left-hand side quieten considerably so that we can all hear the answer.

Hon Annette King : Will Pharmac under the Trans-Pacific Partnership agreement be required to allow the pharmaceutical industry to use evergreening patents—secondary patents held by the owner of the original patent—which extend monopoly periods for medicines?

Hon Dr JONATHAN COLEMAN : What I can say is that there will be no necessity for a change to our policy setting and therefore no necessity to extend the patent period. So we do not need to change any policy settings and there will be no increased costs.

Hon Annette King : Has he been told what data protection means under the Trans-Pacific Partnership agreement; if so, what impact will such a mechanism have on a generic manufacturer of pharmaceuticals?

Hon Dr JONATHAN COLEMAN : Yes, I have been told what it means; and the impact will not mean that we have to make any change to our policy settings, because the 20-year patent protection period remains in place and there will be no extension to that protection period. So there will not be any change in the ability of New Zealanders to access generic medications. So all your scaremongering comes to nothing.

Hon Annette King : I raise a point of order, Mr Speaker. I asked what the mechanism did to the generic manufacturers of pharmaceuticals—

Mr SPEAKER : Order! The member did not. She asked two questions. The first question was whether he had been told what data protection means, and that was answered immediately.

Hon Annette King : What analysis of the financial impact of data protection mechanisms to be used to deliver comparable outcomes under the Trans-Pacific Partnership agreement has been undertaken?

Hon Dr JONATHAN COLEMAN : There has been extensive financial analysis by experts in the field. The key point is that we do not need to make any change to our policy settings, and there will be no incurred costs. So the member going around saying that costs would increase by a billion dollars is completely untrue.

Hon Annette King : Point of order, Mr Speaker. [Interruption]

Mr SPEAKER : Order! To Dr Megan Woods I say that a point of order has been called. That means she will remain silent.

Hon Annette King : I raise a point of order, Mr Speaker. You will know that that was an incredibly straight question about what analysis there had been on the financial impact. He went straight into attacking me personally.

Mr SPEAKER : No, he did not. He went immediately to answer the question and said there had been extensive analysis, using the words “financial analysis”, and then went on with an additional answer to the question that was certainly unhelpful, but the question was addressed.

Hon Annette King : Supplementary question—[Interruption] Oh, come on. Give him a hand. Will the Government commit to an independent health impact assessment of the Trans-Pacific Partnership agreement to be made available before the agreement is signed?

Hon Dr JONATHAN COLEMAN : There is going to be an overall national interest assessment, so that will incorporate those factors.

Trans-Pacific Partnership—Public Health System

6. SIMON O’CONNOR (National—Tāmaki) to the Minister of Health : What impact will the Trans-Pacific Partnership Agreement have on New Zealand’s public health system?

Hon Dr JONATHAN COLEMAN (Minister of Health): The Trans-Pacific Partnership agreement preserves New Zealand’s public health system, in particular, the fundamentals of the Pharmac model. Pharmac will incur very minor additional costs relating to transparency provisions. As promised, the public will still pay no more than $5 per subsidised prescription item. Furthermore, the Trans-Pacific Partnership agreement will significantly boost New Zealand’s export-dependent economy to the tune of $2.7 billion a year by 2030, allowing future Governments greater choices about investment and social services such as health care.

Simon O’Connor : What reports has the Minister seen about the costs imposed on New Zealand’s health care system as a result of the Trans-Pacific Partnership?

Hon Dr JONATHAN COLEMAN : I am advised that the costs to Pharmac from the Trans-Pacific Partnership are very minor, with extra transparency costs amounting to around $4.5 million in one-off costs and $2.2 million per year in ongoing operating costs out of the nearly $16 billion health budget. I have seen other reports claiming that the cost to New Zealand’s budget from the Trans-Pacific Partnership would be $1 billion, and that people would die waiting for access to medicines. New Zealanders will be relieved that these scaremongering claims from the Labour Party are totally without foundation.

Mr SPEAKER : Order! That answer has gone quite far enough.

Simon O’Connor : What was the context for the “constructive ambiguity” quote in relation to Pharmac and the Trans-Pacific Partnership referred to by the Opposition in question time yesterday?

Mr SPEAKER : I will allow that question but I will be listening—[Interruption] Order! I will allow the question but I will be listening very carefully, and if it is an attempt to attack the Opposition the Minister can expect to be sat down.

Hon Dr JONATHAN COLEMAN : The Minister of Trade provided a briefing to members of Parliament during which he used the phrase “constructive ambiguity”, meaning that the Trans-Pacific Partnership requirements around biologics are framed in such a way that New Zealand meets those requirements. Of course, there is ambiguity around the Labour Party stance on this issue.

Hon Annette King : I raise a point of order, Mr Speaker. Could I ask you to go back and consider the tapes from yesterday when the Minister accused me of making up this quote from the Minister of Trade but used it today in a question to justify an answer?

Mr SPEAKER : I will—[Interruption] Order! No, I do not need any assistance. Well, I do need some assistance here. I need the ceasing of the interjections while I am on my feet. I will go back and have another look, but as I read the transcript from yesterday the Minister did not actually say that the member had made something up. It was not words to that effect, but I will have another look at the transcript from yesterday and certainly I will be reviewing the transcript from today.

Hon Dr JONATHAN COLEMAN : Speaking to the point of order, Mr Speaker.

Mr SPEAKER : No, I have dealt with that matter. If the member has—

Hon Dr JONATHAN COLEMAN : Well. I have got the transcript here. I can solve—

Mr SPEAKER : Order! I do not need that from the member. [Interruption] Order! I am very tempted to ask the Minister to leave this Chamber. It is becoming a bit of a habit of this Minister to continue to create disorder in this House. On this occasion he can stay, but if it happens again my patience for this particular Minister will not last very long, and that is the last warning I will be giving the Hon Dr Jonathan Coleman.

Syria—United Nations Permanent Five Members

7. Dr KENNEDY GRAHAM (Green) to the Prime Minister : Does he stand by his statement, “That’s really a matter for them”, when asked whether he was concerned about any of the United Nations Permanent Five members bombing Syria without a UN mandate?

Rt Hon JOHN KEY (Prime Minister): Yes. I will not speak for any of the member States involved. They have themselves put forward their own reasons for their actions and the grounds that they are relying on under international law.

Dr Kennedy Graham : Given that nobody is asking the Prime Minister to speak for other States, how can he none the less reconcile his statement with New Zealand’s commitment as a member of the UN Security Council to uphold the United Nations Charter?

Rt Hon JOHN KEY : Because in relation to the question that the member asked me yesterday and was part of the primary question today, the member States in question do believe they are observing the United Nations Charter.

Dr Kennedy Graham : Is abrogating responsibility on serious issues such as aggression without a UN mandate the kind of leadership he was talking about when campaigning for a seat on the United Nations Security Council?

Rt Hon JOHN KEY : We are not, as I said before, and the member needs to listen carefully. Those member States have quite publicly stated that they believe their actions are consistent with the United Nations Charter. The member should know that.

Dr Kennedy Graham : How can the Prime Minister say he is showing leadership in the face of a refugee crisis out of Syria when he will not increase the refugee quota, takes a minimal emergency intake, and when under his watch New Zealand has dropped from 83rd to 90th per capita in terms of refugee intake?

Rt Hon JOHN KEY : Because we are.

Economy—Crown Debt

8. GRANT ROBERTSON (Labour—Wellington Central) to the Minister of Finance : What is the dollar amount of gross and net core Crown debt and by how much have these grown since he became Minister?

Hon BILL ENGLISH (Minister of Finance): When National came into office, net debt was $10 billion and gross debt was $31 billion. In 2014-15 net debt was $61 billion and gross debt was $86 billion. On planet Earth we had the global financial crisis and the Christchurch earthquake. On “Planet Labour” nothing happened.

Grant Robertson : Is it correct that the Government is paying $13 million a day in interest on this debt or, to put it another way, he is paying nearly as much in interest a month as his surplus for the year?

Hon BILL ENGLISH : That may be right. Those numbers, of course, are too high, which is why I was surprised last week when the member was advocating the Government borrow more money to invest in international sharemarkets.

Grant Robertson : Do his Budget documents state that he will not pay down any of this debt until the 2019 financial year?

Hon BILL ENGLISH : That will be updated in the next round of forecasts. It is possible that generating a cash surplus to pay down nominal net debt will actually be a bit of a challenge. I know the member will support every step the Government takes to restrain expenditure so we can reduce that large growth in debt.

Tim Macindoe : What alternative approaches to managing Crown debt has the Minister seen?

Hon BILL ENGLISH : I have seen alternative proposals that would require the Government to expand its borrowing programme—one just the other day was that the Government should borrow around another $12 billion to invest in international sharemarkets, which are particularly volatile, and that proposal came from the member who now says we have got too much debt.

Grant Robertson : Is it correct that his failure to pay down any of his $60 billion debt until 2019 is the reason he will not resume contributions to the Superannuation Fund until 2021?

Hon BILL ENGLISH : That, I think, is a sequence outlined in the Budget—that when the Government has some spare cash it will put it into the Superannuation Fund. The way to bring that forward would be to slash and burn spending. That is not the Government’s intention, but if the member has some more intelligent suggestions than that, we would be happy to listen to them.

Trans-Pacific Partnership—Dairy Industry

9. BARBARA KURIGER (National—Taranaki – King Country) to the Minister for Primary Industries : What reports has he received on how the Trans-Pacific Partnership will benefit New Zealand’s dairy industry?

Hon NATHAN GUY (Minister for Primary Industries): Dairy will have the biggest tariff savings of any sector from the Trans-Pacific Partnership. When fully implemented, the potential savings will be around $102 million per year—roughly 40 percent of the overall gains. New Zealand’s dairy exporters will have preferential access to new quotas in the United States, Japan, Canada, and Mexico, in addition to tariff elimination on a number of products. Although we are disappointed that there was not agreement to eliminate all dairy tariffs, the Trans-Pacific Partnership still gives us better access than we have now.

Barbara Kuriger : Apart from tariff reductions, what other benefits will the Trans-Pacific Partnership deliver to the dairy industry?

Hon NATHAN GUY : Good question. Importantly, the Trans-Pacific Partnership also reduces non-tariff barriers to trade and ensures fair access for New Zealand exporters in Trans-Pacific Partnership countries. It will give our exporters more certainty at the border, with customs, food safety, and biosecurity rules more transparent across the 11 countries. This means fewer delays for goods to clear at the border, more reliability of supply, and fewer compliance costs for our exporters.

Workplace Health and Safety—Farms

10. IAIN LEES-GALLOWAY (Labour—Palmerston North) to the Minister for Workplace Relations and Safety : Was he advised by officials that agriculture was in the highest risk category, and dairy cattle farming in the second highest, when determining which industries should have health and safety representatives; if so, why did he remove them from the list?

Hon Dr NICK SMITH (Minister for the Environment): on behalf of the Minister for Workplace Relations and Safety : No. The highest-risk category was coal mining, at 322 fatalities per 100,000 employees. The second highest was forestry, at 77. Fishing and hunting was at 35. Agriculture was at 12 fatalities per 100,000 workers. It is also a bit arbitrary where you draw the line between risk categories, and that is why the Government is currently consulting on the draft regulations.

Iain Lees-Galloway : I raise a point of order, Mr Speaker. This was a question on notice, and the question asked whether he was advised by officials that agriculture was in the highest-risk category. He has not addressed that question.

Mr SPEAKER : I agree entirely with the member. The best way forward is for me to allow the member two additional supplementary questions. [Interruption] Order! If the Hon Nick Smith wishes to stay to answer the balance of the question, I suggest that he stop criticising me.

Iain Lees-Galloway : Was the Minister advised by Ministry of Business, Innovation and Employment officials that agriculture was in the highest-risk category?

Hon Dr NICK SMITH : No. The advice from the department, which I have received and have before me, is that the highest-risk category was coal mining. The second-highest risk category was forestry. The third-highest risk category was fishing and hunting. Agriculture was the eighth highest.

Iain Lees-Galloway : I seek leave to table the advice given to the Minister, which demonstrates that agriculture is in the highest-risk category.

Mr SPEAKER : On this particular occasion, I will put the leave. Leave is sought to table that particular document. Is there any objection? There is not. It can be tabled. Document, by leave, laid on the Table of the House.

Hon Dr Nick Smith : I seek the leave of the House to table the advice that was received by the Minister on the categories and the risk ratings applied to them by—

Mr SPEAKER : Can I just clarify whether that is the information that we have just had tabled by Iain Lees-Galloway?

Hon Dr Nick Smith : No, it is very different.

Mr SPEAKER : There is no point in tabling it twice.

Hon Dr Nick Smith : Well, I think that is the issue.

Mr SPEAKER : Then I will put the leave as well, and then the members will have all the information they need in order to sort it out for themselves. Leave is sought to table the particular documentation presented by the honourable Minister. Is there any objection? There is none. It can be tabled. Document, by leave, laid on the Table of the House.

Iain Lees-Galloway : When his office emailed the principal policy adviser at the Ministry of Business, Innovation and Employment, outlining his own criteria for determining high-risk industries, was he aware that he was setting the criteria at exactly the right level to exclude dairy farming?

Hon Dr NICK SMITH : I cannot state what the Minister was or was not aware of, and I apologise to the member. If you wish to put it to the Minister in writing, I am sure that he will respond when he is present.

Iain Lees-Galloway : Did he read the email from the Ministry of Business, Innovation and Employment dated 17 August 2015 that warned that his proposed regulations would define minigolf, worm farming, and being a TV anchor as high risk but the entire construction industry as low risk; if so, why did he still release the list unamended 2 days later?

Mr SPEAKER : Hon Dr Nick Smith, either of those two supplementary questions.

Hon Dr NICK SMITH : I cannot comment on what exact details the Minister had or had not read. What I would note is that the actual consultation risk categories that are currently out and that have been published by the Minister are, in my view, a very sensible allocation of the level of risk and do not include any of the anomalies that the member has referred to.

Iain Lees-Galloway : I seek leave to table an email from the ministry’s policy adviser to the Minister’s office, dated 17 August, which outlined the issues with the regulations that he had set.

Mr SPEAKER : I will put the leave. Leave is sought to table that particular email. Is there any objection? There is none. Document, by leave, laid on the Table of the House.

Iain Lees-Galloway : Why did he say to the media that he had looked into the groupings of various industries but “not as closely as the media clearly have”, when his officials had looked that closely and specifically warned him that his approach had consequences that may be “unintended”?

Hon Dr NICK SMITH : The first point I would make is that the regulations are subject to consultation. The regulations that have been put out for consultation do not include any of those anomalies. Those anomalies exist when you analyse the data down to very, very small groups of occupations where there are one or two employers only. Inevitably, the data is not going to be reliable, and you should not base the risk categories on those very small sample sizes; neither has the Minister done so in the regulations that are being consulted on.

Iain Lees-Galloway : I raise a point of order, Mr Speaker. That was a reasonably straight question—

Mr SPEAKER : Order! No, I listened very carefully to the question: why did he say something to the media when the officials said something else? He said that he thought the regulations were then subject to consultation. That is an answer that addresses the question.

Iain Lees-Galloway : Why did he say to Cabinet that “I don’t believe it is onerous to have health and safety representatives in most cases.” while recommending that if there were to be an exclusion for small businesses, it should apply to businesses with one to five employees rather than the much broader exclusion of 20 workers, which Cabinet ultimately agreed to?

Hon Dr NICK SMITH : The Minister provided that advice, I am sure, because he wants to provide improvements in health and safety and also wants to be practical for small businesses. Members on this side of the House do not think that for the majority of our farms that employ one or two people, having an election for a health and safety person is actually that practical. What we think is practical is the requirement that the Minister has put in the law, and that is that every employer—small or large, farm or not—has to lift their game around occupational safety and have workers participating in health and safety programmes.

Iain Lees-Galloway : Does this whole episode of ignoring officials’ advice and ignoring the advice of trade unions and business organisations not indicate that this Government has no moral compass and is willing to put people’s lives at risk to suit National’s vested interests?

Hon Dr NICK SMITH : No, no, quite to the contrary. I have heard members opposite give lecture after lecture that they actually understand small business. Well, I say to members opposite: if you think that having an election over who might be the health and safety representative in the average farm in New Zealand, where there are two workers, that just shows how impractical those members are in trying to apply better workplace safety laws for this country.

Trans-Pacific Partnership—Regional New Zealand

11. FLETCHER TABUTEAU (NZ First) to the Minister for Economic Development : How would the Trans-Pacific Partnership help regional New Zealand?

Hon STEVEN JOYCE (Minister for Economic Development): I thank the member for his question. The Trans-Pacific Partnership is exciting news for businesses across New Zealand, but particularly for those in regional New Zealand. The Trans-Pacific Partnership allows access for New Zealand exporters to up to 800 million potential customers, and covers 40 percent of existing global trade. In the US, the world’s largest economy, and Japan, the world’s third-largest economy, and across the rapidly developing Asia-Pacific region the Trans-Pacific Partnership will benefit all our exporters by opening up fairer access to more markets, whether they are farmers in Hawke’s Bay or Manawatū, wine growers in Central Otago, or manufacturers in Waikato. As a Government we back our farmers, our horticulturalists, our wine growers, and our manufacturers. We are confident that they are equal to the best in the world, and with this agreement they get access to big consumer markets to compete on a more equal footing with local suppliers. And this is exactly the same answer to the same question yesterday.

Fletcher Tabuteau : What happens to the New Zealand regional economy if Trans-Pacific Partnership signatories fail to complete necessary domestic procedures within 2 years after the initial signing?

Hon STEVEN JOYCE : If individual countries do not accede to the agreement, then obviously they will not be participating in it, which would be the effect of the status quo as it is now. But I strongly believe that those countries will accede to the agreement because of the obvious benefits that that agreement brings.

Fletcher Tabuteau : I seek leave to table an article dated 13 October—

Mr SPEAKER : The source of the article, please?

Fletcher Tabuteau : —a subscription-only trade journal, so it is not widely accessible—outlining this process, which is completely contrary.

Mr SPEAKER : I will accept the member’s word. Leave is sought to table this particular article. Is there any objection? There is objection.

Fletcher Tabuteau : What happens to the deal, given Mr Groser told Q+A that everyone should wait until the officials from 12 countries can do this Herculean task of getting the text—

Mr SPEAKER : Order! I need a supplementary question. It is not a chance to make a speech. Can the member rephrase the question in line with the Standing Orders and ask it.

Fletcher Tabuteau : If he agrees with this statement, what would be the conclusion if the Spanish or French versions of this agreement contest the English version?


Hon Paula Bennett : Bonjour.

Hon STEVEN JOYCE : There is quite a tradition of translation, actually, that occurs between languages, as a general rule. So, for example, when I say “Bonjour” to you now, I mean “Hello”—

Hon Tim Groser : Hola.

Hon STEVEN JOYCE : —and “Hola” would be Spanish. You know, there are legions of people whose job it is to translate—[Interruption]

Fletcher Tabuteau : I raise a point of order, Mr Speaker.

Mr SPEAKER : Order! Is the member going to attempt to raise a point of order?

Fletcher Tabuteau : Yes, that was my point—

Mr SPEAKER : Then I will hear the point of order, but I expect to hear it in silence.

Fletcher Tabuteau : I just wanted an answer to the question.

Mr SPEAKER : Order! The difficulty is that I did not understand the question, because it was such a long-winded question. If the member could take some time out to practise asking supplementary questions—[Interruption] Order! I do not want comment from the back half of the House on my right-hand side. I go back through the questions—yesterday, particularly. They are too long winded. The member would do himself a favour if he could sharpen up his supplementary questions so I can assist him to then get an answer that is satisfactory.

Ron Mark : I raise a point of order, Mr Speaker. [Interruption]

Mr SPEAKER : Order! Any member has a right to raise a point of order, but I just want to be fair to the member that if he is in any way attempting to relitigate where I have just been with a ruling, I will be most upset.

Ron Mark : Trying to assist my colleague and asking for your indulgence, his question started with the word “what”. He went on to quote word for word what a Minister had said—

Mr SPEAKER : Order! The member is now—[Interruption] Order! The member is relitigating just where we have been. If the member wants to have a look at the Standing Orders, they describe quite clearly that questions are meant to be concise. It does not require the length of quote the member was putting into his question. I can assist the member to get answers to his question when it is simple and concise, but the way it was worded is unsatisfactory and is not in line with the Standing Orders. The fact that it started with the word “what” does not suddenly make it correct. If the member has further supplementary questions, then we can move on. I hope they are going to be in line with the Standing Orders.

Fletcher Tabuteau : Supplementary question—[Interruption]—when these guys are ready. Regional New Zealand needs to know what the Japanese tariff on beef under the Trans-Pacific Partnership agreement will be if beef imports into Japan from Trans-Pacific Partnership countries exceed 550,000 tonnes during the first year of implementation.

Hon STEVEN JOYCE : Those details will all come through in the finalised text. But I can tell the member that over time the beef tariffs for New Zealand into Japan drop from 38.5 percent to, I think, around 9.5 percent, which by anybody’s measure is a great step forward for beef farmers importing into Japan.

Fletcher Tabuteau : How will regional New Zealand benefit from the Trans-Pacific Partnership if the current account deficit deteriorates even further due to imports far exceeding exports—four to one, for example—as with the ASEAN free-trade agreement?

Hon STEVEN JOYCE : Aside from the fact that, actually, New Zealand consumers benefit from cheaper imports as well—but let us leave that aside—the important point for the member, perhaps, and the salutary example, would be the China free-trade agreement, which has had one of the bigger impacts on the tradable economy in recent years. Actually, since 2008, I think, the current account deficit, from memory, is about 8.5 percent of GDP. Currently it is around 3.5 percent of GDP, despite the fact that we set up a big China free-trade agreement. So although individual countries will not necessarily have trade balances—either positively or negatively in terms of the exports and imports—on the whole New Zealand greatly benefits from being connected to the world and having the opportunity to sell its products on the world stage. I appreciate that the member does not necessarily agree with that, but that actually is the history and the prospect for regional New Zealand.

Clayton Mitchell : I raise a point of order, Mr Speaker. Could I hear your reading on what length of question is actually a reasonable one, for the future? We have had questions in the past that have been 70-odd words long, when this one that we have just had was only 40 words long. It would just be good to have some—

Mr SPEAKER : Order! Members should carefully look at the Standing Orders, particularly Standing Order 380. There is no particular word count as to what length a question or answer will be. I will judge that on each occasion. But I am trying to be of assistance to the member who was asking the supplementary questions. If he tightens them up, I can then assist him in getting answers. When it is a very long-winded question, it gives Ministers a very wide ambit in answering the question, and often a point of order is raised then that the question has not been addressed to the satisfaction of the members. I am trying to assist the members.

Ron Mark : I raise a point of order, Mr Speaker.

Mr SPEAKER : Fresh point of order?

Ron Mark : Thank you—it is fresh, yes. Standing Order 386—[Interruption] In silence, David Bennett—

Mr SPEAKER : Order! The member will resume his seat. Now I will hear what I expect to be the point of order—I know exactly what it will be, but will still listen to it, very, very briefly.

Ron Mark : Standing Order 386, again, as you know, Mr Speaker, refers to the answers being concise. What we had was a perfect example of how an answer can be—

Mr SPEAKER : Order! No, the member will resume his seat. [Interruption] Order! The member needs to listen when I try to assist, particularly New Zealand First members. When you get a long-winded question, it then gives the Minister a far wider ambit in answering it. A question as wide as the member asked—talking about the current account deficit in relation to the Trans-Pacific Partnership—gave the Minister a very wide ambit. As I have mentioned to Mr Mark on more than one occasion, I am the adjudicator. I will decide when the answer has gone on for too long, not Mr Mark. [Interruption] No, I have heard quite enough from the member. [Interruption] Order! Question No. 12, Joanne Hayes.

Trans-Pacific Partnership—Environmental Components

12. JOANNE HAYES (National) to the Minister for the Environment : What reports has he received on the environmental components of the Trans-Pacific Partnership and how do these compare with other free-trade agreements entered into by New Zealand?

Hon Dr NICK SMITH (Minister for the Environment): I have received a report by the Ministry for the Environment, and it states that the Trans-Pacific Partnership sets a new benchmark for environmental provisions in trade agreements and goes significantly further than the current eight agreements that New Zealand is party to. The most significant new features cover conservation of flora and fauna; illegal, unreported, and unregulated fishing; protection of sharks, seabirds, turtles, and marine mammals; transition to a low-carbon economy; tackling alien invasive species; and also include provisions in liberalising trade in both environmental goods and services.

Joanne Hayes : How will the Trans-Pacific Partnership strengthen environmental regulation across the 12 partner countries, and what other tools does it support to ensure that there are environmental benefits from the agreement?

Mr SPEAKER : The Hon Dr Nick Smith, either of those two supplementary questions.

Hon Dr NICK SMITH : A key difference from previous trade agreements is that this is the first in which the environmental chapter is enforceable and includes dispute settlement processes. This means that if countries are not meeting their obligations around addressing issues like illegal fishing, or conservation of endangered species, or protection of the ozone layer, there is actually an enforcement mechanism that strengthens those environmental components. The second part is that the Trans-Pacific Partnership also puts an obligation on countries to encourage tools like the Marine Stewardship Council and Forest Stewardship Council certification schemes for products like New Zealand’s important fish and forestry exports. That is important for New Zealand and creates opportunities, because we manage both our fish and our forests more sustainably than most—

Mr SPEAKER : Order! The answer is very long.

Joanne Hayes : What response has there been from environmental groups to the TPP?

Hon Dr NICK SMITH : The World Wide Fund for Nature has noted that the Trans-Pacific Partnership goes further than any other trade agreement. It says that it is a game-changer in addressing pressures on fisheries, on wildlife, and on forests. The reality is that environmental issues like protecting our forests, oceans, and wildlife actually do require a coordinated international response, and I would encourage opponents of the Trans-Pacific Partnership to take note of the World Wide Fund for Nature’s advice and actually support what makes not just economic sense but good environmental sense.


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