Questions to Ministers

Office of Treaty Settlements—Ngāti Whātua ki Ōrākei Process

1. Dr PITA SHARPLES (Co-Leader—Māori Party) to the Minister of Māori Affairs: He aha tōna whakautu ki te reta a Tiati Carrie Wainwright i kī rā “ko te mutunga mai o te hē, ngā mahi kua kitea e te Taraipiunara”, arā, “i te āhua o ngā whakariterite i waenganui i te Tari Whakatau Take e pā ana ki te Tiriti o Waitangi me Ngāti Whātua ki Ōrākei, ā, ko te mutunga e hē kē atu ana, ngā mahi me ngā kaupapa here a te Karauna mō te hātepe me te putanga?”

[How does he respond to the letter he received from Judge Carrie Wainwright, that in the process followed by the Office of Treaty Settlements with Ngāti Whātua ki Ōrākei, a process “more flawed than any the Tribunal has inquired into”, that “the Crown’s policy and practice has been unfair, both as to process and outcome”?]

Hon PAREKURA HOROMIA (Minister of Māori Affairs):

[An interpretation in English was given to the House.]

Dr Pita Sharples:

[An interpretation in English was given to the House.]

Hon PAREKURA HOROMIA:

[An interpretation in English was given to the House.]

Russell Fairbrother: What has the Government achieved in Treaty settlements since 1999?

Hon PAREKURA HOROMIA: Mai i te tau 1999 mātou i whakatau ēnei take tekau; Te Uri o Hau, Ngāti Ruanui, Ngāti Tama, Ngā Rauru Kītahi, Ngāti Awa, Tūwharetoa ki Kawerau, Ngāti Mutunga, Te Rōroa, Te Arawa Kaihautū, Te Arawa, Ngā Roto o Te Arawa. Kāore ake noa rātou e mōhio ake noa nō te reka o te reo Māori , ā, porohewa i reira.

[An interpretation in English was given to the House.]

[Madam Speaker, since 1999 this Government has resolved the following claims: Te Uri o Hau, Ngāti Ruanui, Ngāti Tama, Ngā Rauru Kītahi, Ngāti Awa, Tūwharetoa ki Kawerau, Ngāti Mutunga, Te Rōroa, Te Arawa Kaihautū, Te Arawa, and Ngā Roto o Te Arawa. They have not experienced the sweetness of the Māori language, even to the stage of losing their hair.]

Christopher Finlayson: Is not the Government’s go-slow approach to Treaty settlements exposed by the fact that of the 19 settlements reached to date, 10 were started and completed by National in the 1990s, a further eight were started by National, and the Labour Government has taken just one claim from initial negotiation through to final settlement in 7½ years?

Hon PAREKURA HOROMIA: That point is well taken, but it is very, very interesting. It is very interesting because this Government has been about expediency and trying to ensure that we can define what finality is, not rabbiting on and hoping these settlements take another 20 years. What a load of rubbish!

Rt Hon Winston Peters: Has the Minister received any reports, particularly those related to the last questioner’s claims that National effected all those settlements with the Māori people, and can he explain how he reconciles that claim with the billboard campaign mounted by Don Brash and his colleagues over there at the last election—it is called hypocrisy of the highest sort?

Hon PAREKURA HOROMIA: As always, those people we care about—

Gerry Brownlee: I raise a point of order, Madam Speaker.

Madam SPEAKER: Please be seated. I think I can anticipate that this is not within the ministerial responsibility—

Gerry Brownlee: No.

Madam SPEAKER: That is not your point of order?

Gerry Brownlee: It is about the hypocrisy statement.

Madam SPEAKER: Would the member mind recasting his question without making such comments, while also making sure that the question is, in fact, within the Minister’s ministerial responsibility.

Rt Hon Winston Peters: Has the Minister received any reports, particularly relating to the last questioner and the substance of his question, which, in effect, claimed all sorts of settlements by the National Party with the Māori people; do those reports reconcile with the “Kiwi not iwi” campaign and all the other billboards that were up at the last election, and is there a word for that that starts with the letter “h”?

Madam SPEAKER: That last comment was inappropriate, but would the Minister please respond.

Hon PAREKURA HOROMIA: I definitely agree with the points that the member has just made.

Metiria Turei: Who will be held accountable and what will happen to those responsible for the officials’ process failure to interact with cross-claimants as they promised; failure to provide accurate information about their status in the negotiations; failure to involve cross-claimants in the deliberations of officials; failure to respond to cross-claimants unless they had persistent lawyers; and, finally, for the provision of misleading information to the Ngāti Whātua o Ōrākei tribunal hearing?

Hon PAREKURA HOROMIA: I have no responsibility for the Office of Treaty Settlements, but certainly myself and my colleague Minister Burton have been discussing those issues, and that supportive role will continue from the Māori ministry. I certainly have an interest in the cost of all of these settlements and how it keeps the great legal fraternity going in this country.

Te Ururoa Flavell: Tēnā koe Madam Speaker. Ki te Minita, he aha tōna whakautu ki tā te Taraipiunara pānui i tērā Mane, arā, i kite nei rātou i ētahi “tino ngoikoretanga i te āhua o ngā uiuinga i waenganui i a rātou me ērā rōpū o Te Arawa kāore i te whakatau tono”, ā, i te mutunga ake i “āwangawanga te Taraipiunara ka waimeha ngā tikanga a Te Arawa, ā ngā rā kei mua i te aroaro?

[An interpretation in English was given to the House.]

[What response does the Minister have to the finding released on Monday that the Waitangi Tribunal found “serious flaws in the way the Crown consulted with non-settling Te Arawa groups”, concluding that the tribunal was left “fearing for the customary future of the Te Arawa waka”?]

Hon PAREKURA HOROMIA: Kei te kōrero tahi ake anō a Te Arawa, kei a rātou tērā. E mōhio ake anō te tangata e pātai ake anō i tērā pātai, i reira kē rātou i te rā i tuhia wētahi o Te Arawa, e kore e tuhia.

Te Ururoa Flavell: I raise a point of order, Madam Speaker. Tēna koe, Madam Speaker. Kia huri ki te reo tuarua nei. The point of order is in respect of the question, which was about his response as opposed to what Te Arawa did or did not believe. I ask the Minister to reconsider his response. The question was about his response, not that of Te Arawa.

Madam SPEAKER: I think we will have the interpretation, then we will make a judgment on that.

[An interpretation in English was given to the House.]

[Te Arawa are indeed talking amongst themselves. They are dealing with that. The member who asked that question is fully aware that they were indeed there on the day; some of Te Arawa signed and some did not.]

Madam SPEAKER: I think that answer did address the question.

Pita Paraone: Tēnā koe, Madam Speaker. Does the Minister consider that the recent reports from the Waitangi Tribunal on the Ngāti Whātua ki Ōrākei claim and that of Te Arawa will impact on the timeliness of these and other settlements; if not, why not?

Hon PAREKURA HOROMIA: It may do so, but certainly it is interesting that these two reports are the two that never went through the tribunal process.

Dr Pita Sharples: Ki te whakaae koe ki tā te Taraipiunara i kī, ko tā te Karauna he tuku whakaatu ki te katoa o ngā patapatai, ā, mēnā kei te whakaae, he aha ai i taka roa, kāre hoki i wawe te tuku kōrero, ā, kaititiro i te wā o ngā tono i Tāmaki-makau-rau, ā, he aha hoki ngā mahi i mahia e Te Puni Kōkiri i tēnei wā i runga i tōna mana whakahaere mō te āhuatanga whakatutuki whanaungatanga i waenganui i te Karauna rāua ko te Māori?

[An interpretation in English was given to the House.]

[Does the Minister agree with the tribunal that it is the Crown’s job to provide evidence on all issues in the inquiry; if so, why was the documentary evidence in the Tāmaki-makau-rau settlement provided late, reluctantly, and piecemeal, and what part did Te Puni Kōkiri play in this role, given its responsibilities in the output class Crown-Māori relationships?]

Hon PAREKURA HOROMIA: Kei te whai kaha ake noa te Tari o Te Puni Kōkiri i te tautokotia ake noa ngā take nei mai rā anō nā te mea, e puta ake noa taku kōrero ki te Kaiwhakahaere a Leith Comer, hei whakatere tae i te tū ake noa ngā kanohi e mau mōhio, e mau matatau ki ngā take katoa i roto i a tātou o te iwi Māori. Kei te mahi awhi ake noa a Te Puni Kōkiri.

[An interpretation in English was given to the House.]

[The Ministry of Māori Development has been working vigorously for a long time in supporting these matters. I have been in consultation with Leith Comer, the chief executive, seeking to hasten the process of bringing aboard staff who are experts in all matters pertaining to our Māori people. Te Puni Kōkiri will continue to play a supportive role.]

Early Childhood Education—Free Hours, Surcharges

2. JOHN KEY (Leader of the Opposition) to the Prime Minister: Does she stand by her statement that “20 hours free means the regulated standard is free”; if so, how many early childhood education services will be able to offer “20 hours free” without also charging parents extra top-up fees, donations, or surcharges?

Rt Hon HELEN CLARK (Prime Minister): Yes. All who sign up will have agreed to provide the regulated standard for free.

John Key: When the Government announced the policy of 20 free hours for early childhood education during the 2005 election campaign, was it always the intention of the Government to actually continue to charge New Zealanders for receiving a service that it was trying to tell them on one brief would be free?

Rt Hon HELEN CLARK: No. This was a full cost model with the rate responsibly set after a survey of all costs.

Darren Hughes: Has she received any advice in respect of claims made in the House yesterday that the Ministry of Education had approved information about the policy that was sent out in a private sector newsletter?

Rt Hon HELEN CLARK: Yes. The advice I have is that Paula Bennett’s claims were false. That seems typical of the National Party’s campaign of denigration.

John Key: When the New Zealand public start to consider the definition of the word “free”, does the Prime Minister think they will use their standard definition, something for nothing, or does she think they will use her definition, something they still have to pay for?

Rt Hon HELEN CLARK: What the public will be relieved to know is that the rate was responsibly set after a survey, rather than our deciding like a money trader just to write out a blank cheque.

John Key: I do not think the Prime Minister should publicly indicate that Labour’s poll ratings are going down. It is not a very good sign.

Madam SPEAKER: If there are any more peripheral comments, we will hear these questions in silence.

John Key: Under the Prime Minister’s policy, how should centres actually deal with parents who cannot, will not, or do not pay the optional fee over and above her regulated standard fee?

Rt Hon HELEN CLARK: There is no obligation to pay an optional fee.

John Key: Does the Prime Minister not realise that many centres simply cannot afford to offer a service of 20 hours free without charging a top-up, and that without that top-up, many New Zealand children will receive a service that is completely substandard to the one they receive today, which is why so many centres are not opting in?

Rt Hon HELEN CLARK: As I said yesterday, the member is going to be very disappointed that his campaign to try to stop centres signing up has been such a spectacular failure.

John Key: Is the Prime Minister aware that the people who are very disappointed are the New Zealanders who believed her when they thought they were getting 20 hours’ free early childhood education, only to find out, when we are not in an election year, that they actually have to pay for it—or are they getting used to broken promises under Labour, in the same way that the Minister of Finance in the 2005 Budget told them they were to receive a tax cut, only to now know they are not to receive a tax cut?

Rt Hon HELEN CLARK: The only people who will be very disappointed are people like the Leader of the Opposition and Sue Thorne, who have campaigned to try to stop people taking up this very good policy.

John Key: Does the Prime Minister stand by her statement made in the House yesterday: “Kidicorp has been a very good supporter of this policy.”, and does that mean we can take it that she endorses Kidicorp’s sensible argument that “20 hours free is nothing but a subsidy that cannot be made to work unless parents pay the top-up fees.”?

Rt Hon HELEN CLARK: I repeat that it is full costs for the regulated standard. This is a great policy, which I confidently predict the National Party will adopt—if not by lunchtime, then probably by the election.

Financial Products, Providers and Intermediaries, Review—Objectives

3. MARYAN STREET (Labour) to the Minister of Commerce: What were the principal objectives of the review of financial products, providers, and intermediaries, and how have those objectives been achieved?

Hon LIANNE DALZIEL (Minister of Commerce): The principal objects of the review were to give investors confidence, to improve consumer protection, and to ensure that New Zealand meets its international obligations. These have been addressed, with the announcement that all financial service providers will be registered, subjected to a range of background checks, and required to belong to an approved consumer dispute resolution scheme. Non-bank deposit takers will come under the prudential supervision of the Reserve Bank, and, as part of that, will be required to have credit ratings, enabling investors to know the risk they are taking with their hard-earned money.

Maryan Street: What was the process for conducting these reviews, and what has been the response to the announcement?

Hon LIANNE DALZIEL: The reviews involved input from a task force and from several expert groups that were involved in developing the discussion documents that were put out for public submissions last year. It is therefore not surprising that the response from the financial sector has been incredibly positive, with financial service providers welcoming the greater professionalism that will result from the new framework. As one finance company chief executive officer said in describing credit ratings as a good move: “By having ratings it creates that platform whereby the investor can actually compare one opportunity with another.” I think this has been a very good result.

Simon Power: Can she advise real estate agents and bank tellers whether information they provide to people who wish to invest, such as “The term deposit rate for today is 8.5 percent.”, will see them categorised as financial advisers under this new regime?

Hon LIANNE DALZIEL: I have not heard a real estate agent offer that advice before, but I can tell the member that the detail that he has asked for is in the public arena, in the form of all the questions and answers that we provided his office with yesterday. Real estate agents will be covered as financial advisers if they are providing advice on investment property. If they are providing advice on investment property, they will be caught by the new regime. Bank tellers will not be caught by the new regime, because they are not giving financial advice when they are simply providing information that is available at the bank.

Maryan Street: Will fringe moneylenders, also known as loan sharks, be included in the publicly available register; if so, what sort of people will not be operating such businesses in the future?

Hon LIANNE DALZIEL: Yes, they will. Those with dishonesty or fraud convictions within the last 5 years, money-launderers, undischarged bankrupts, and those subject to a confiscation or forfeiture order under the Proceeds of Crimes Act will not be able to operate as moneylenders in the future. In addition, these loan sharks will have to belong to an approved dispute resolution scheme, which means they will have to be more careful about compliance with the Credit Contracts and Consumer Finance Act, which we suspect is not always the case at the moment. This regime represents a substantial strengthening of the existing law, and I am sure the Minister of Consumer Affairs will be watching the implementation very closely.

House Prices and Rents—Ring-fencing of Investment Losses

4. Hon BILL ENGLISH (Deputy Leader—National) to the Minister of Finance: What effect would ring-fencing any losses from investment in housing have on house prices and rents?

Hon Dr MICHAEL CULLEN (Minister of Finance): Given the effective tax advantage of investment in housing, it should cool the housing market, particularly over the longer term. The impact on rents is less certain, particularly as it may become easier for those renting to purchase their own homes. Generally speaking, one would expect a convergence between house prices and rentals, over time, as a return on investment.

Hon Bill English: Can the Minister confirm, then, that the effect of ring-fencing losses would initially be to force rents up and to force everyone’s house value down?

Hon Dr MICHAEL CULLEN: A change of this sort takes some time to occur. For example, when ring-fencing was removed in 1991, we did not move immediately to a position where rental losses outweighed rental income. That did not occur until about 1996.

H V Ross Robertson: Can the Minister advise the House whether the Government is taking any steps to support people who might want to save for their own homes?

Hon Dr MICHAEL CULLEN: Those who join the KiwiSaver scheme, which comes into effect on 1 July, and save 4 percent of their income for 3 years will have access to a first-home deposit subsidy of $1,000 per year of membership, up to a maximum of $5,000 for 5 years for each member, subject to certain eligibility criteria—so, potentially, $10,000 for a couple. The Minister of Housing is currently developing a shared equity scheme, and this will be considered as part of Budget 2008.

R Doug Woolerton: Does the Minister share the views of the Governor of the Reserve Bank and New Zealand First that rampant immigration has had a major impact on house prices and rents, and will he be seeking to limit immigration numbers to help ensure that Kiwis can still afford to own their own houses in their own country?

Hon Dr MICHAEL CULLEN: I do not think it is fair to describe Dr Bollard’s view as being that “rampant” immigration has had an impact on inflation. He pointed out that, obviously, an increase in population, whether by immigration or by other means, has an impact upon the housing market. Equally, of course, immigration has served to provide additional labour into a tight labour market, which otherwise might have seen high rates of increase in the cost of labour.

Gordon Copeland: Is the Minister open to alternatives to the ring-fencing of tax losses, for evaluation against the criterion of increasing housing affordability and as a supplementary monetary policy instrument, whether arising from Finance and Expenditure Committee inquiries or from elsewhere, including those alternatives that other parties in the House may care to offer?

Hon Dr MICHAEL CULLEN: I am always open to alternatives and discussion. If the member is capable of bringing another 48 votes with him on this matter, I will be extraordinarily grateful.

Madam SPEAKER: Supplementary question, the Hon Bill English.

Rt Hon Winston Peters: I raise a point of order, Madam Speaker. I was on my feet asking for a question, and you gave the question to somebody who was sitting in his seat. That is not the way it is done, Madam Speaker. I was on my feet.

Madam SPEAKER: Yes, well, I am on my feet now, Mr Peters. I determine who gets the call. New Zealand First had had a call. There is a convention that the call goes on rotation. When I do not do that, that member, I am afraid, also criticises the Chair.

Rt Hon Winston Peters: I raise a point of order, Madam Speaker. Would you please explain to me which Standing Order, Speaker’s ruling, or convention requires you to seek someone who is not on his or feet and give that person the question?

Hon Dr MICHAEL CULLEN: Speaking to the point of order, I say that the member raises a point that is useful in a wider context, because a habit has developed in the House—I think partly because of the rotation of supplementary questions—whereby a lot of members do not now actually rise and call before receiving the call. I think that often the Speaker sees that, for example, it is time for a Green call, and if a Green person is rising to his or her feet, the assumption is that he or she is doing so to ask a question. I think it would be helpful if we reverted to the more traditional practice where people have to rise in their seats and call. It is quite correct that Mr English did not call at that point, and began to sit down again when Mr Peters sought the call at that point. Madam Speaker, it is worth bringing to the attention of the House that it is helpful from your perspective if people do actually stand and call when they are seeking to ask a supplementary question.

Madam SPEAKER: I thank the member for that. In the past I had noticed that Mr Peters had risen then actually sat again. I will consider the issue, and I will come back tomorrow with a considered ruling on it. In the past, if parties did not get the call in the rotation when they were expecting it, then matters were raised—as the member has done himself. That is fair enough. I think we do need some clarity on this. I also am aware—and I want to put this as sensitively as I can—that some people take some time to rise to their feet. I am trying to be sensitive to that, as well.

Rt Hon Winston Peters: If the Minister is saying that the job market was filled by high immigration numbers, then what evidence does he have that is different from the briefing of the Department of Labour post election 2002, which said that up to that point fewer than one out of two immigrants had been placed in the economy; what has changed in the last 4 years to make that false?

Hon Dr MICHAEL CULLEN: What has changed in part is the significant change in the criteria for immigration, to place far greater emphasis upon the general skills category. Of course, if a person is immigrating with a family, then not all of that family will be entering the job market, necessarily—particularly if there are children. But the reality is that if the member cares to look at the data over a significant number of years, he will see that the balance of immigration has moved very significantly in the direction of an emphasis upon the skills element.

Hon Bill English: What does the Minister believe will be the effect on homeowners with large mortgages when their 2-year interest rate goes from 7½ percent to 9¼ percent, as will occur for thousands of them in the next 6 months; and why is he not satisfied with that impact on their pockets and their house values, without his adding another measure, which may have the effect of pushing their house values down even further than high interest rates will?

Hon Dr MICHAEL CULLEN: One of the reasons for considering measures around this is, in fact, to aid monetary policy, so that interest rates do not need to be raised as much. This member has been calling for higher increases in interest rates by the Governor of the Reserve Bank, as a means of throttling off demand. It is a bit rich now for him to turn round and bemoan the consequences. In the immortal words of Tom Paine, he “pities the plumage, but forgets the dying bird”.

Hon Bill English: Where has the Minister been for the last 6 years, when house prices have been rising continuously; if he thought that this measure was effective at all, why did he not bring it in 5 years ago?

Hon Dr MICHAEL CULLEN: The member bounces around from opposing such a measure to suggesting that it already should have been done. Once he settles at some particular place, I will know how to explain to his leader, John Key, why and where he differs from him.

Hon Bill English: Does the Minister have the support of the Prime Minister for his campaign to push down house values, in the light of her comments on Monday explicitly ruling out a capital gains tax; and does her failure to rule out ring-fencing losses mean that it is now Government policy?

Hon Dr MICHAEL CULLEN: No such proposal has been taken to Cabinet, therefore by definition it is not Government policy. One of the problems with a capital gains tax—apart from the fact that if it were done, it should apply to all asset classes—is that countries overseas that have capital gains taxes have significant inflation in house prices on occasion.

Hon Bill English: In reference to overseas data, has the Minister seen the data in the Reserve Bank submission that shows there is absolutely no correlation between the tax treatment of housing and the rise in house prices—in other words, it does not seem to matter what tax treatment different countries have; their house prices have risen to roughly the same extent?

Hon Dr MICHAEL CULLEN: If the Reserve Bank is saying that, I am stunned. In fact, the variability in house price increases in the last 10 years, even in developed countries, has been extremely large. Some countries, such as Japan, have seen a fall in house prices over that period of time. Some countries, such as Ireland, have seen very much higher increases than those in New Zealand over that period of time. What is significant in New Zealand is that before ring-fencing was removed in 1991, net rental income was more than 80 percent of gross rental income, in total, whereas, on average, over the last 7 or 8 years net rental income has been less than 10 percent of total rental income. That points to very heavy gearing of purchasing property for rental purposes.

Climate Change—International Negotiations

5. STEVE CHADWICK (Labour—Rotorua) to the Minister responsible for Climate Change Issues: What recent reports, if any, has he received on New Zealand’s role in international negotiations for much-needed agreement on climate change post-2012?

Hon DAVID PARKER (Minister responsible for Climate Change Issues): New Zealand has been taking a leading role in climate change negotiations in Sweden. We were asked to lead discussions on the critically important topic of emissions pricing to speed up the use of low-emissions technology to help the world beat global warming. This was indeed a high honour, with the other two lead speakers being China and the European Union, and it recognised the Labour-led Government’s leadership in this important area.

Steve Chadwick: Does the Minister have any early indications of who might sign up to a post-2012 agreement?

Hon DAVID PARKER: One hundred and seventy-five countries ratified Kyoto. Only three backed out of their earlier agreement: Australia, the United States, and Kazakhstan. Of course, we know what side the National Party is on. Australia and the United States have recently modified their positions—

Rt Hon Winston Peters: Borat!

Hon DAVID PARKER: The member is quite right; we can only assume that perhaps Dr Smith takes his instructions from Kazakhstan.

Hon Dr Nick Smith: How will the record of his Government since 1999—which is that greenhouse gas emissions have increased by 10 million tonnes per year, an increase double the rate of what occurred during the 1990s, and one of the fastest growth rates in the developed world—how will this awful record—

Rt Hon Helen Clark: Carbon neutrality.

Hon Dr Nick Smith: I say to the Prime Minister that it is her awful record. It does not look much like carbon neutrality to me. How will an increase of 10 million tonnes a year, which is the fastest growth rate in the developed world, help our credibility in trying to get the rest of the world to constrain its emissions?

Hon DAVID PARKER: I am quite happy to contrast the record of this Government with the National Party’s position, and I really do not expect much better from the National Party. I have a quote here from Dr Smith, which I think illuminates his attitude to this issue, in which he boasts about being “at the coalface of environmental policy”. I suspect he got that from Borat, too.

Peter Brown: Noting the Minister’s comments about Australia, is he aware that Australia has reduced its emissions over recent years, yet has not signed up for Kyoto, whilst, with us, it is exactly the reverse; is he aware also that Australia has recently released a detailed report on how it will effect a “cap and trade” system by the year 2012; and does he believe that this is such a serious global issue that it would be well worth our while getting involved with Australia?

Hon DAVID PARKER: Australia has not reduced its emissions. Australia had the softest proposed Kyoto target of any target country in the world, which was 108 percent of emissions—an 8 percent increase in emissions over the 1990 base level—and it is not yet clear whether it will make even that 8 percent increase. It may go even higher. In respect of its proposals to develop an emissions trading scheme, I would have thought that people would be somewhat suspicious of an emissions trading scheme that is projected to be 5 years out from one of the three countries in the world that said they would not commit to their agreement.

Jeanette Fitzsimons: Does the Minister agree with India’s former environment secretary, Pradipto Ghosh, that it is “now up to the world to decide how big the ‘carbon pie’ should be at a certain point in the future—say, 2050—and then agree that by that date all nations should have an equal entitlement relative to their size of population.”; if he does not agree with that approach, what alternative criteria does he support for allocating emissions globally after 2012?

Hon DAVID PARKER: It is clear that developed countries will have to reduce their emissions in gross terms towards the much lower levels of emissions that are coming from developing countries. But it is also true that convergence alone will not cure the problem, because if there were to be convergence at realistic levels, that would see the growth in emissions in developing countries causing global warming to reach levels that, really, no one wants to get to.

I seek leave to table a report in the Marlborough Express, in which Dr Smith said he wanted to consult on National’s environmental policy at the coalface.

Leave granted.

Hon Dr Nick Smith: I seek leave of the House to table the Government’s actual record, which has seen a 10 million - tonne increase—

Madam SPEAKER: Leave is sought to table that document. Is there any objection? There is objection.

Jeanette Fitzsimons: I seek leave to table the quote from the Indian former environment secretary, which makes clear he was talking about the size of the pie—

Leave granted.

Early Childhood Education—Free Hours, Surcharges

6. KATHERINE RICH (National) to the Minister of Education: What advice has his ministry given early childhood centres regarding the setting of optional charges, and what are the appropriate steps for a centre to take in the event that parents refuse to pay any optional charges under the Government’s 20 free hours policy?

Hon STEVE MAHAREY (Minister of Education): The advice is the same as mine. The Government is funding 20 hours of quality early childhood education. Any additional charges are optional, and parents have a choice as to whether or not to agree to pay them. That is why, as I think Paula Bennett quite rightly says, parents will be clearly better off.

Katherine Rich: What is a centre that takes up his 20 free hours policy to do if it is faced with a parent who refuses to pay optional charges, which many centres will be relying on, not to pay for luxuries but for day-to-day costs like books, teachers’ salaries, and electricity?

Hon STEVE MAHAREY: As the rules are set out, a centre cannot refuse to enrol a child on the grounds that the child’s parents have not agreed to pay an optional charge. The second part of the question by the member of course is really fictitious. What we are talking about here is a fully funded model, based upon a survey of the entire sector. As the member learnt at the select committee today, there has been a 56 percent response to that survey, which is twice the size of the sample that the reviewers said was needed to get an accurate idea of costs.

Moana Mackey: Does he have any specific reports of how families will benefit from the Government’s 20 free hours policy?

Hon STEVE MAHAREY: Our understanding is that the costs to families of early childhood education will go down, that access will go up, and that centres themselves will find that they will get more stable and more predictable funding. It is therefore a pity that the National Party campaign of misinformation has perhaps meant that some centres will not enrol just now. They will wait to see how it goes. That means that mums and dads and their kids will miss out on 1 July, but I am sure they will come in at a suitable time.

Katherine Rich: Regarding the families that will benefit, can he confirm that after 1 July some Kiwi parents who are not near a centre offering 20 free hours could miss out, while a non-resident, non-citizen, long-term holidaymaker or overstayer who is living beside the right centre could get 20 hours free?

Hon STEVE MAHAREY: The member asked this question in the select committee today. The information given to her was that 0.25 percent of enrolments in early childhood education centres currently fit that description. Our opinion is that that is a reasonable place for a young child to be. It is better for them to be there than to be nowhere.

Katherine Rich: How does the Minister think that some Kiwi parents will feel—those parents who will miss out on 20 free hours because they do not have access to it in their local community—when they hear that some parents who are not residents, who are not citizens, and who may be here for a long-term holiday or overstaying for some other reason could get 20 hours free, when they cannot get it in their local community?

Hon STEVE MAHAREY: I think when they know it is 0.25 percent of enrolments, they will think that the member’s question is pathetic.

Katherine Rich: When some centres that may offer 20 free hours will potentially have extremely long waiting lists, why will he not specify in his new policy of 20 free hours that priority must be given to New Zealand residents, New Zealand citizens, and Kiwi mums and dads, and not to people who may be here for an extended holiday?

Hon STEVE MAHAREY: As the member knows, public services are for Kiwis first, but we are talking about 0.25 percent of enrolments. The member herself, when asked today at the select committee what her policy would be, said, as usual, that she did not have a policy.

Paula Bennett: Could the Minister give us his definition of “free”?

Hon STEVE MAHAREY: In relation to the early childhood policy that we are talking about, we are funding 20 hours of quality education for 3 and 4-year-olds.

Paula Bennett: As the Minister continually uses school donations as a comparable example, is it not true that if a parent does not pay a school donation there are no consequences, except maybe that the child does not go to the school ball, whereas not paying a donation to an early childhood education centre under the 20 hours free policy could mean that a teacher loses his or her job?

Hon STEVE MAHAREY: The example that the member is using comes from the head of the New Zealand Educational Institute, who has praised the 20 hours policy, saying it is the best thing for families and is a huge step forward for education. I am very glad that the member is referring to Irene Cooper, because she is a huge supporter of this policy. I say to the member opposite that we are funding 20 hours of early childhood education to the quality level, and if there are any additional services, then those are optional charges.

Primary Health Organisations—Māori Enrolments

7. DAVE HEREORA (Labour) to the Associate Minister of Health: Has he received any recent reports on the number of Māori enrolled in primary health organisations?

Hon MITA RIRINUI (Associate Minister of Health): I am advised that as at April 2007 523,673 Māori were enrolled, and from July they will benefit even more from this Government’s commitment to make doctors’ visits and prescriptions more affordable. Our investment in primary health care has reduced doctors’ fees by around $27.50 and has lowered standard prescription charges from $15 to $3.

Dave Hereora: Has he received any regional reports of the impact of those investments in primary health care reductions?

Hon MITA RIRINUI: I receive reports on a regular basis through the Ministry of Health. I will give some examples of the work that is being done out in the regions that complement the Government’s policies on primary health and the primary health sector. For example, the Te Pou Ora o Te Piringatahi, Northland primary health organisations’ mental health initiative, was basically designed to improve the identification, treatment, and support of people with mental health and addiction issues in the primary-care setting, also to provide better follow-up and coordination for people with mental health and addiction issues in Northland, and, lastly, to promote better understanding and prevention of mental health and addiction issues in that area. I also receive other reports on a regular basis—for example, from Ngāti Porou Hauora and the University of Otago on their Ngāti and Healthy programme, which is run through the Tairāwhiti District Health Board. To cut a long story short, Ngāti Porou Hauora was the supreme award winner in the 2006 Whānau Ora awards. I have many other examples here.

Unemployment—Household Labour Force Survey

8. JUDITH COLLINS (National—Clevedon) to the Minister for Social Development and Employment: Does he agree with the statements of his predecessor, the Hon Steve Maharey, that the household labour force survey is “the only credible and consistent measure of unemployment”, the “best way of measuring New Zealand’s performance internationally”, and “the only accepted measure of unemployment”?

Hon DAVID BENSON-POPE (Minister for Social Development and Employment): I am somewhat surprised that the member has nothing better to do than to trawl through Steve Maharey’s press releases from 7 years ago, good reading though they are—

Madam SPEAKER: Please be seated. The Minister knows that such comments prefacing an answer to a question are bound to create disorder. So I would ask Ministers to refrain from doing so and to please just address the question.

Hon DAVID BENSON-POPE: For the member’s information and for the information of the House, I point out that the household labour force survey is New Zealand’s only official measure of the unemployment rate. Let me remind the House of the unemployment rate that the Labour-led Government inherited when coming into office shortly before Mr Maharey made those statements. In 1999 the unemployment rate was 6.8 percent; it is now 3.8 percent. In 1999 the youth unemployment rate was 16.7 percent; it is now 14.1 percent. In 1999 the unemployment rate for Māori was 16.6 percent; it is now 7.9 percent. In 1999 the unemployment rate of Pacific peoples was 13.6 percent; it is now 6.5 percent. I think members would agree that this is rather a credible and consistent improvement.

Judith Collins: If the household labour force survey is the official register of unemployment, was the reason the Minister said in the House last week that the survey had shortcomings because the data confirms that unemployment amongst 15 to 19-year-olds has actually increased by 16 percent from 24,000 in March last year to 27,800 in March this year, according to the most recent household labour force survey?

Hon DAVID BENSON-POPE: It is important that the member does not confuse the unemployment benefit figures and the household labour force survey. The household labour force survey, I note for members’ information, includes all people who are seeking 1 hour or more employment per week, including full-time students and retired people. Many people, of course, such as full-time students or those receiving New Zealand superannuation, are quite reasonably not entitled to any unemployment support. The numbers can therefore be, and are in fact, quite different, especially for youth, because the household labour force survey unemployment figure will include, for example, any school or tertiary student seeking part-time work.

Lynne Pillay: Could the Minister remind the House how many young people were on an unemployment benefit in 1999 compared with now?

Hon DAVID BENSON-POPE: I can report that in December 1999 there were 17,514 18 and 19-year-olds receiving an unemployment benefit. In March of this year there were 1,566 young people receiving such a benefit. I can now report that in the most recent figures at the end of May, that number was only 1,227. That is a massive 93 percent reduction in unemployed 18 and 19-year-olds since this Government took office. That success is equally mirrored with impressive results for Māori and Pacific young people. The number of 18 and 19-year-old Māori unemployed at the end of May were 477, which is a 92 percent reduction since National was in office. Pacific unemployment numbers for the same period are now 125. That is a 91 percent reduction since National was in office, and of that number let me stress that of the 1,227, only 407 have been receiving an unemployment benefit for more than 13 weeks.

Judith Collins: When will the Minister confirm that New Zealand still has a major problem with teenage unemployment, that 15 to 19-year-olds have been shunted off the unemployment benefit to other benefits or to dubious employment schemes, and that the 2002 goal of getting all 15 to 19-year-olds into employment, education, or industry training has been abandoned by the 27,800 people who are now unemployed teenagers—which that Minister will not admit?

Hon DAVID BENSON-POPE: I think that most New Zealanders would welcome the very strong Government focus, which is on reducing benefit dependency, and, in particular, on ensuring that young people who are at risk of under-employment, unemployment, or long-term unemployment, or who have low skills, are appropriately supported. The success of those initiatives is only too well demonstrated with the dramatic fall in benefit numbers that I have detailed several times in the last few days.

Judith Collins: Why does the Minister use household labour force data sometimes—when it suits his version—as he did on 10 May this year, but when it comes to using it as a measure of teenage unemployment he discounts it and insists on using the same Work and Income figures, which he has quoted today, that Steve Maharey said were no more than an administrative tool?

Hon DAVID BENSON-POPE: I talk about the household labour force survey when I am talking about the household labour force survey. When I talk about unemployment benefit numbers I refer to unemployment benefit numbers.

Judith Collins: Why does the Minister choose to use figures that his predecessor, Steve Maharey, called just “an administrative tool” when Mr Maharey has also stated that using Work and Income figures rather than the household labour force data was “to play fast and loose with unemployment statistics”?

Hon DAVID BENSON-POPE: I use the household labour force survey because it enables us to track participation rates, and employment and unemployment rates, and to compare them with the OECD statistics, which are measured in a similar fashion. The household labour force survey conforms with the standard International Labour Organization guidelines for comparability. It helps us recognise our successes in international terms. The household labour force survey has enabled us to see, for example, that we have the fifth-lowest unemployment rate among the 27 OECD countries with comparable data—that shows a pretty considerable improvement. In December 1999 we were 14th; now we are fifth out of 27 OECD countries.

Judith Collins: Can the Minister explain why 3 years after his predecessor announced a $56.9 million package in Budget 2004 to provide all 15 to 19-year-olds with a “kick-start to their working lives” the number of unemployed 15 to 19-year-olds has actually increased by 16 percent according to the official register of the household labour force survey?

Hon DAVID BENSON-POPE: I have already explained to that member that the household labour force survey includes all people who may be looking for 1 hour’s work or more and includes students. It is a good example of why it is often more important to look at the actual unemployment figures. I think the best answer for the member’s question is if I read the trending—

Madam SPEAKER: It is becoming very difficult to hear the Minister.

Hon DAVID BENSON-POPE: The best answer I can provide for the member is to read the trending in one cohort. I will choose 18 and 19-year-old unemployment numbers from 1998 to the present day. In 1998 there were 14,000 receiving that support; in 1999 there were 17,000; in 2000 there were 13,500; in 2001 there were 11,000; in 2002, 10,000; in 2003, 9,163; in 2004, 5,991; in 2005, 4,271; in 2006, 3,262; and the last figure, in 2007—and remember that the starting point, the highest point, was 17,500—in May was 1,227.

Judith Collins: I seek leave to table “Playing fast and loose with unemployment stats won’t wash” by Steve Maharey.

Madam SPEAKER: Leave is sought to table that document. Is there any objection? There is objection.

Judith Collins: I seek leave to table the article “ ‘Honest’ job figures sought”, from the Dominion Post in October 2002.

Madam SPEAKER: Madam SPEAKER: Leave is sought to table that document. Is there any objection? There is objection.

Judith Collins: I seek leave to table “Budget 2004: $57 million boost for young people”.

Madam SPEAKER: Madam SPEAKER: Leave is sought to table that document. Is there any objection? Yes, there is objection.

Judith Collins: I seek leave to table the household labour force survey—the latest one out this year.

Madam SPEAKER: Madam SPEAKER: Leave is sought to table that document. Is there any objection? Yes, there is objection.

Judith Collins: I seek leave to table the article “Mayors give up target date to end teen joblessness” of 23 April 2007.

Madam SPEAKER: Madam SPEAKER: Leave is sought to table that document. Is there any objection? Yes, there is objection.

Judith Collins: I seek leave to table the article “Complacency kills students’ dreams” of 11 May 2007 in the New Zealand Herald.

Madam SPEAKER: Madam SPEAKER: Leave is sought to table that document. Is there any objection? Yes, there is objection.

Question No. 7 to Minister, 19 June

Hon DAVID BENSON-POPE (Minister for Social Development and Employment): I seek leave of the House to table the Hansard from the British Parliament giving the complete quote by Mr Rooney that was used selectively yesterday.

Leave granted.

Schools, Primary—Half-days Open for Instruction

9. Hon BRIAN DONNELLY (NZ First) to the Minister of Education: For how many half-days will primary schools be required to be open for instruction in 2007, 2008, 2009, and 2010?

Hon STEVE MAHAREY (Minister of Education): The length of the school year varies in order to accommodate requests from teachers and parents for a 7 February start to ensure that at least some of the summer holidays occur in summer, and to prevent the nuisance of the stop-start beginning of the year brought about by the Waitangi Day public holiday. The actual half-days that primary schools are required to be open for instruction are: in 2007, 386; in 2008, 384; in 2009, 386; and in 2010, 388.

Hon Brian Donnelly: Will the Minister confirm that the requirement set in the Education Act, notwithstanding his discretion, and also set out in the 2006 and 2007 Budgets, is in fact 394 half-days, and why has he used his discretion in this particular way?

Hon STEVE MAHAREY: In fact, both Labour and National Governments over the last little while have used that discretion, because the original figure was 398. Of course, it was dropped down 4 days by the National Government—

Hon Brian Donnelly: It was 400.

Hon STEVE MAHAREY: It was 400 earlier still—that is right. It has been changed by National and by Labour. But in my own case, as I said before, we have had quite a significant number of requests from teachers and parents about the fact that schoolrooms were hot, and that there was a disturbed start to the beginning of the year, which meant there was that stop-start effect. But, wait, there is more: the member might like to know that I have also responded to requests from schools that, in some cases, have said they would rather start before 7 February. I have allowed them to have that flexibility, as well. As long as they provide students with the required number of half-days, they can do that; they can start before Waitangi Day if they want to.

Dr Ashraf Choudhary: How does pupil-teacher contact time in New Zealand compare with that in other countries in the OECD?

Hon STEVE MAHAREY: New Zealand ranks second-highest, coming after only the USA in the OECD table of pupil-teacher contact time, and it remains the second-highest under the term dates set for 2008 through to 2010. In addition to those favourable statistics on pupil-teacher contact hours, of course, we want to point to the fact that quality is also important, and I point out that, on international measures of quality, we do pretty well.

Hon Brian Donnelly: Has the Minister had drawn to his attention the large body of research that demonstrates that time spent in engaged academic learning significantly impacts on learning outcomes; if he has, how will reducing engaged academic learning time improve learning outcomes?

Hon STEVE MAHAREY: Yes, I am familiar with that research, but I remind the member of two things. First, as reinforced in a quotation from Irene Cooper from the New Zealand Educational Institute, it is the quality of what happens that matters. And I take him back to the fact that if he is concerned, he knows that we are sitting at No. 2 in the OECD in terms of the amount of pupil-teacher contact time. I hardly think we have fallen down the ranks in comparison with other countries, in terms of contact time.

Hon Brian Donnelly: Has the Minister heard the complaints from teachers and teacher associations that there is currently not enough time to teach the curriculum; if he has, why has he not only reduced the time available for curriculum delivery but also introduced an additional curriculum component into year 7 and 8 programmes?

Hon STEVE MAHAREY: Yes, I have heard the complaint from teachers about the enormous number of things that people want to have go on in school. The curriculum development at the moment has highlighted that, with everybody asking for the curriculum to carry one or other interesting idea. I just say to the member, though, that those very same people, who come from all of the associations to do with education and with parents, were consulted about the changes in the length of the school year, and agreed to them because they saw them as a good, quality measure. However, I would say that if we could clone the member and have him in every class, I am sure students would turn up voluntarily.

Shared Equity Scheme—Nationwide Roll-out

10. PHIL HEATLEY (National—Whangarei) to the Minister of Housing: When does he anticipate the nationwide roll-out of the shared equity scheme, which is to be preceded by a “targeted pilot” to be “considered for next year’s budget”, and how many New Zealanders does he expect will eventually be able to take advantage of the national scheme?

Hon CHRIS CARTER (Minister of Housing): I would expect that the roll-out of a shared equity scheme might occur when we have completed the targeted pilot scheme, assured ourselves of the effectiveness of the scheme, and resolved any issues identified in the pilot scheme. I cannot be more specific about the timing of any roll-out at this stage because we are still in the design phase of the pilot scheme; nor can I provide figures of how many people might be able to participate in a roll-out scheme, because those are details that have not yet been decided, and, again, will be influenced by the pilot scheme.

Phil Heatley: Why is he still at the design stage of a shared equity scheme this year, then, perhaps, a pilot scheme next year, when answers to parliamentary questions say that the Government has been looking at such schemes since 2004, and the then Minister of Housing said that Labour was likely to introduce a scheme in the 2005 Budget?

Hon CHRIS CARTER: Shared equity is a new model of homeownership for New Zealand. It is not full ownership, it is partial ownership, and that carries a host of new legal and technical implications. We need to test demand for this model of homeownership, and we also need to take care to introduce it in a way that does not create market distortions that defeat the purpose of the scheme. That takes time.

Jill Pettis: Could the Minister advise what other homeownership initiatives the Government has already introduced apart from the shared equity scheme?

Hon CHRIS CARTER: The Labour-led Government has introduced the Welcome Home Loan scheme, which underwrites families on the margin of traditional bank criteria and helps them to get a home. About 2,600 households have used the scheme so far. We have also introduced the KiwiSaver scheme, which offers some first-time buyers assistance with a deposit, and provides a pathway to saving more quickly a much larger deposit on a home. We have also introduced a $2.5 million homeownership education programme, which has been rolled out across the country.

Bob Clarkson: Why is he still designing the scheme, when Helen Clark said the Government will “introduce an equity scheme in 2006” and “The Government had flagged the scheme as an election promise”—

Rt Hon Winston Peters: He should know!

Bob Clarkson: If you want to debate something, Winston, we will talk about scampi deals.

Madam SPEAKER: Would the member please start his question again. We will hear it in silence.

Bob Clarkson: Why is he still designing the scheme, when Helen Clark said the Government will “introduce an equity scheme in 2006” and “The Government had flagged the scheme as an election promise and was committed to delivering it.”?

Hon CHRIS CARTER: The Prime Minister and other Ministers in the Government have signalled that we will be having a shared equity pilot scheme, for the reasons that I outlined in an earlier answer. This is a complex process, this is a new product, and I can ensure the member that the pilot scheme will be offered.

Phil Heatley: Is the Minister telling us that he announced the scheme in 2004, again in 2005, again in 2006, and again this year, without doing any design work at all, and without seeing whether there was any need for it or public desire for it; if so, why has he announced a shared equity scheme every year for the last 4 years, without doing the design work for it?

Hon CHRIS CARTER: What I can tell the House is that the Government is committed to firm actions to try to create housing affordability and provide access to homeownership. I have outlined a number of schemes that are already in place, and have signalled that the shared equity pilot scheme will happen next year. What is interesting is that I looked at the National Party’s website before question time today, and found no reference to housing, at all. Does that mean that party does not have any housing policy at all?

Phil Heatley: What is the Minister doing to address housing affordability, if it is not encouraging district councils to release more land for subdivision, if it is not fixing the Resource Management Act 1991, and there is no sign of his flagship nationwide shared equity scheme anywhere on the horizon for the next 2 years?

Hon CHRIS CARTER: I have already outlined a basket of initiatives that the Government has taken. I remind the member who has just asked me the question that there is no reference to housing, at all, on the National Party’s website. When is that party going to offer us any solutions?

Phil Heatley: Has the Minister had discussions with the Minster of Finance on the introduction of a policy to ring-fence tax losses on rental housing; if not, why not, given that he is the Minister of Housing and is looking at housing and affordability; if so, what is his opinion on ring-fencing tax losses on rental housing?

Hon CHRIS CARTER: Like all members of this Government, I am in constant dialogue with the Minister of Finance.

Phil Heatley: I seek leave to table the answer to written question No. 10742, which says the Government has been working on this matter since 2004.

Madam SPEAKER: Leave is sought to table that document. Is there any objection? Yes, there is objection.

Phil Heatley: I seek leave to table the article “Help for home-buyers likely”, from the Press of 3 March 2005.

Madam SPEAKER: Leave is sought to table that document. Is there any objection? There is objection.

Phil Heatley: I seek leave to table the press release headed “More help for first-home buyers”, dated 22 August 2005.

Madam SPEAKER: Leave is sought to table that document. Is there any objection? Yes, there is objection.

Phil Heatley: I seek leave to table Labour’s election policy “Our Own Equity Share Scheme”, from 2005.

Leave granted.

Phil Heatley: I seek leave to table the article headed “First-timers to get cheap homes”, from the Sunday Star-Times of July 2006.

Madam SPEAKER: Leave is sought to table that document. Is there any objection? Yes, there is objection.

Phil Heatley: I seek leave to table the article headed “Shared equity schemes among options to lift home ownership”, from a New Zealand Herald of August 2006.

Madam SPEAKER: Leave is sought to table that document. Is there any objection? Yes, there is objection.

Phil Heatley: I seek leave to table the article headed “Housing Boom: Shared equity on Gov’s housing agenda”, from an Independent of January 2007.

Madam SPEAKER: Leave is sought to table that document. Is there any objection? Yes, there is objection.

Phil Heatley: I seek leave to table the article “Carter urges NZ banks to consider shared equity schemes”, dated March 2007.

Madam SPEAKER: Leave is sought to table the document. Is there any objection? There is objection.

Phil Heatley: Lastly, I seek leave to table Labour’s Budget announcement that there will be a pilot shared equity scheme some time at the end of next year.

Madam SPEAKER: Leave is sought to table that document. Is there any objection? There is objection.

Hon CHRIS CARTER: I seek leave to table a copy of the official National Party website, which contains no reference to housing initiatives, or any housing policy at all.

Leave granted.

Rt Hon Winston Peters: I raise a point of order, Madam Speaker. My point of order is a request for you to consider what this House has just experienced, which, in my view, was a gross waste of Parliament’s time. For someone to get up and read out his recent reading bibliography is not an acceptable practice in Parliament. If we all did that, there would be a hopeless lack of work being done in this Parliament. That is surely a procedure that that member and his party, in particular, should reflect on.

Madam SPEAKER: I thank the member. The member will be interested to know, as may other members, that this matter is being actively considered by the Standing Orders Committee.

Gambling—Inquiry into Relationship with Loan Sharks

11. SUE BRADFORD (Green) to the Minister of Internal Affairs: Will he call for a full public inquiry into the relationship between loan sharks and gambling in New Zealand; if not, why not?

Hon RICK BARKER (Minister of Internal Affairs): Although I have no responsibility for the treatment of loan sharks, and the sometimes questionable behaviour they exhibit, I am concerned with ensuring that gambling operators follow the rules. For example, allegations have been made that loan sharks were preying on gamblers at the Christchurch Casino. I assure the House that the moment officials of the Department of Internal Affairs became aware of those allegations, an investigation was initiated. When the investigation is complete, I expect the Department of Internal Affairs to take the appropriate action, and my own response to that will be informed by the result of the inquiry, and not before.

Sue Bradford: Why does the Minister think that that will be enough, when loan sharking inside casinos is endemic around the country, not just in Christchurch; when dealers are themselves actually introducing gamblers to loan sharks; and when young women, unable to pay their loans, are working off their debts in brothels owned by loan sharks?

Hon RICK BARKER: I read with interest the press release put out just hours ago by that member, which makes those allegations. I invite the member to forward those allegations to me, either anonymised or otherwise, and I will have my department and officials investigate them thoroughly. If there is substance to them, action will be taken.

Sue Bradford: Will the Minister investigate reports that Department of Internal Affairs inspectors are being given free lunches at the Christchurch Casino, and does he think that that may impact on their ability to fully and fairly investigate activities there?

Hon RICK BARKER: I am aware that those allegations have been made, and I intend to make no comment until an investigation is complete. To do so would prejudice it.

Sue Bradford: Why does the Minister think that an investigation solely by the Department of Internal Affairs will be sufficient, when the department appears to be so unaware of what is really going on in casinos across the country and when there is an urgent need for affected parties to be able to give full and frank evidence under conditions of anonymity, given the threats of violence and kidnapping that underpin aspects of this loan-sharking industry inside casinos?

Hon RICK BARKER: The Department of Internal Affairs has monitors that examine every aspect on the floor of a casino. They check all the money that goes in and out of a casino, and have very, very thorough checks. I am confident the department has a good idea of what is going on. As to the member’s allegations, I make my offer again that I would appreciate it if she would forward those allegations to me, anonymised so people are not identified, or she can direct the people to me, and I will arrange an appropriate investigation. This is the first time the matter has been brought to my attention.

Pharmac—Replacement of Ritalin SR with Rubifen SR

12. Dr JONATHAN COLEMAN (National—Northcote) to the Minister of Health: Why has Pharmac replaced Ritalin SR with Rubifen SR as the subsidised medication for the treatment of attention deficit hyperactivity disorder?

Hon PETE HODGSON (Minister of Health): Pharmac did so because it can save $1 million per annum, for the same drug, and use the money elsewhere to buy other drugs.

Dr Jonathan Coleman: Is the Minister aware of reports that children whose medication has been changed from Ritalin to Rubifen have displayed a marked deterioration in behaviour, which in some cases has resulted in children having to be removed from school; if so, what action will be taken?

Hon PETE HODGSON: Yes, I am aware. The reactions to this drug, or to any other drugs, are collected always by the centre for adverse reactions monitoring, which is based in Dunedin. It advises that of the more than 6,000 children currently on this drug, fewer than 20 have reported any effects. Of those 20, there is no pattern to the effects, and the centre for adverse reactions monitoring therefore, at this point, has no advice to offer Pharmac.

Dr Jonathan Coleman: Does the Minister acknowledge that this is a problem for families like the Celliers family of North Shore, whose little 8-year-old’s behaviour deteriorated so badly when he was changed from Ritalin to Rubifen that he had to be removed from school and was unable to go back until his parents started paying for the Ritalin themselves?

Hon PETE HODGSON: Yes. I do not myself name individual New Zealanders who have issues, but I am aware of the case. I just say to the member that this is the same drug. It has the same active ingredient, and when we look at the bioavailability graphs, which by the way have been sent out to every prescriber, we see the graphs are super-imposable. That does not mean there is not some idiosyncratic response from some young children, from time to time. My understanding is that this family has reapplied for an “exceptional circumstance”.

Dr Jonathan Coleman: Can the Minister see there is a fundamental disconnect between Vote Education and Vote Health when a little 8-year-old has to be taken out of school like that, with all the disruption and cost that that entails; and what would the Minister say in the case of children who are removed from school, who need Ritalin in order to go back, but whose parents cannot afford up to $145 per month to pay for it?

Hon PETE HODGSON: The member is a doctor and he has not heard me! So let me say this again. We are dealing with exactly the same active ingredient, and when we look at the pharmacokinetics we find exactly the same bioavailability. In other words, the drug levels are the same. Therefore the drugs are the same. What happens is that the coating of the drug may have caused some effect in some child. This is happening to a very modest degree. It would happen if the change in drug had occurred the other way. What is most likely, so advises one paediatrician, is that there is a reaction between the little boy’s long-term Ritalin and his short-term Ritalin.

Hon Dr Michael Cullen: Is there an interesting disconnect between people arguing for improvement of productivity in the health care system and always opposing any kind of cost reductions that occur within it?

Hon PETE HODGSON: The member makes a good point. This drug had $1 million shaved off the cost, by virtue of a tendering process. The tendering process is an effort to get competition into the drug industry. It is an effort to get value for money in the health system. Since 1998, tendering has saved $300 million. The Government does not lack ambition when it comes to getting value for health in the health system. What is more, we monitor all drug reactions to ensure that if there are any responses, there is no pattern to them. If there is a pattern to a response, then there is reconsideration—on the spot.

ENDS

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