Questions And Answers - Wednesday, 18 July 2007

Questions to Ministers

Reserve Bank—Policy Targets Agreement

1. Hon BILL ENGLISH (Deputy Leader—National) to the Minister of Finance: Did he consult Rt Hon Winston Peters prior to reappointing Dr Bollard and signing an unchanged policy targets agreement earlier this year; if not, why not?

Hon Dr MICHAEL CULLEN (Minister of Finance): No; because Mr Peters is not part of the Cabinet and is not bound by Government policy or decisions on matters such as that.

Hon Bill English: Does the Minister believe he still has the confidence of the Government’s coalition partner, when its leader has stated that the Reserve Bank governor whom Dr Cullen has just reappointed is not fulfilling—

Rt Hon Winston Peters: I raise a point of order, Madam Speaker. We surely do not need to have to inform the former leader, now the deputy leader, of the National Party that there is no such coalition between the Government and New Zealand First. It is a confidence and supply agreement, and I would hope that he would come up to date with the 21st century and the evolving forms of democracy that are helping New Zealand today.

Madam SPEAKER: I thank the member for his comment, and I am sure the member Mr English has noted it.

Hon Bill English: Is the Minister aware that the Rt Hon Winston Peters has stated Dr Bollard is not carrying out the terms of the policy targets agreement, and does he believe that his reappointment of Dr Bollard is consistent with the confidence and supply agreement with New Zealand First?

Hon Dr MICHAEL CULLEN: Yes, and yes.

Hon Bill English: Why did the Minister agree by prearrangement with Mr Peters yesterday to assist him in introducing into the House a bill to amend the Reserve Bank of New Zealand Act?

Hon Dr MICHAEL CULLEN: First of all, the word “prearrangement” is not quite loaded with the devilish intent the member seems to ascribe to it. It is quite normal for parties in this House to talk to each other before things happen in the House. I frequently talk to Mr Brownlee in the morning about what is to happen in the House, and despite that he still gets it wrong often when he gets in here at 2 o’clock in the afternoon. On the second point, I am not afraid of discussion of ideas and alternatives. I recommend that possibility. While the member is grinding around at the bottom of the National Party, his leader is bouncing from cloud to cloud with all kinds of ideas that the member does not seem to know about.

R Doug Woolerton: Has the Minister considered using the powers of the Reserve Bank of New Zealand Act to direct the bank to formulate and implement monetary policy for different economic objectives?

Hon Dr MICHAEL CULLEN: Under section 12 of the Reserve Bank of New Zealand Act there is the power to suspend the policy targets agreement and to incorporate objectives other than the primary objective outlined within the Act. I have given no specific consideration to that matter, but the section is clearly there for a purpose and as Minister of Finance I would never rule out its potential use.

Gordon Copeland: Is he continuing to investigate ways to cool the housing market through, for example, increasing the land supply for new housing subdivisions or ending the tax advantages now enjoyed by property investors, to supplement the policy targets agreement, thus creating some scope for lower interest rates and a more favourable exchange rate?

Hon Dr MICHAEL CULLEN: There is still a range of work occurring within that area, and I will be happy to report to the House on it at the appropriate time.

Hon Bill English: Does Dr Cullen’s previous reply—that he is open to ideas and to discussion about the Reserve Bank of New Zealand Act itself—mean that Labour has now moved away from 20 years of consistent bipartisan support for the Reserve Bank of New Zealand Act as it is now?

Hon Dr MICHAEL CULLEN: No, it does not, but I am quite happy for a matter such as that to be discussed. I am quite confident about what the conclusion of that discussion would be, but, unlike the member, I am not afraid of discussion.

Rt Hon Winston Peters: Could the finance Minister advise the House as to whether—

Gerry Brownlee: Next Treasurer.

Rt Hon Winston Peters: Well! I think it is quite churlish to ridicule the protocols and values of another culture, such as that of Samoa.

Dr the Hon Lockwood Smith: Answer the question. [Interruption]

Madam SPEAKER: Would the member please continue asking his question. [Interruption]

Rt Hon Winston Peters: That is what I would expect from the Dominion Post. But I would not expect members of Parliament to take that arrogant, ethnic, prejudicial attitude towards Samoa.

Madam SPEAKER: Please be seated. Members who make such interjections are coming close to creating disorder in the House. So you are warned. I now ask the member to complete his question.

Rt Hon Winston Peters: Thank you, Madam Speaker. Could the finance Minister advise us as to whether he is aware of any other OECD country that has seen huge depressions, fluctuations, and rises in the value of its currency to the extent that New Zealand has seen in the last 20 years, since the Reserve Bank of New Zealand Act came into effect?

Hon Dr MICHAEL CULLEN: I think a range of countries have seen wide fluctuations in their currency values. The Australian currency has not fluctuated quite as much as New Zealand’s, but the difference is definitely not one that is of an order of size. There have been very strong fluctuations in its currency. The most freely floating currencies have seen wide variations over that period of time.

Hon Bill English: If, as the Minister says, he is sticking by Labour’s position that it supports the Reserve Bank of New Zealand Act as it is, then why did he not block Mr Peters’ attempt yesterday to introduce an amendment to it—or is he just treating Mr Peters as a kind of plaything?

Hon Dr MICHAEL CULLEN: It is definitely not the latter. I would remind the member that he signed up, in the select committee, to a discussion of the operation of monetary policy. The terms were agreed with the National Party, and then it said it was not part of it. That is the way National usually behaves on anything to do with Parliament, at the present time. It is part of it but not part of it—some kind of strange transcendent experience, in terms of Parliament. [Interruption] National has to get off the clouds and get back down to grinding again, in that regard.

Rt Hon Winston Peters: Can the Minister tell us which other OECD country’s currency has appreciated in value to the more than 100 percent extent that the New Zealand currency has done in the last 5 years, and how that would affect any exporter with a long-range sales programme; and has the Minister received any reports as to who, yesterday, when offered a chance to rectify, by discussion and perhaps resolution, the serious damage that is being done to our exporters, opposed such a motion?

Hon Dr MICHAEL CULLEN: On the last point, my recollection is that the only person who said no was actually Bill English, which was a change from Tony Ryall being the only person to say no on something of importance to the country. On the former matter, I do not have the comparative figures in front of me. Clearly, the New Zealand currency has been highly volatile over that period of time; it has been for the last 20 years. But as a small, relatively illiquid currency, it is always going to be relatively volatile as long as it is freely floating. New Zealand does not possess the kinds of levels of overseas reserves that would enable it to directly intervene all the time, as say, for example, the Singaporean central bank does.

Hon Bill English: Can the Minister tell the House once and for all whether he supports New Zealand First’s proposed amendment to the Reserve Bank of New Zealand Act, and if he does not support it, what kind of silly game is he playing in humouring Mr Peters by pretending that he might let it in the House even though he is against it?

Hon Dr MICHAEL CULLEN: I am not in the least afraid of that bill going to the select committee for an intelligent discussion. Unlike the member, I actually believe that that discussion would lead to confirmation of the broad outlines of the current Reserve Bank of New Zealand Act, including section 12. The point I made in the House yesterday was that section 12 gives some of the flexibility that Mr Peters was seeking by changing the Act.

Rt Hon Winston Peters: Is the Minister aware of the prevailing economic opinion that says that had the Government taken some steps such as establishing the Cullen fund and the KiwiSaver fund earlier, this country would be in somewhat the same position as Singapore when it comes to our currency, and that being the case, is he aware that the National Party has now offered to New Zealand First, should it present its motion again, to back a debate in this House on that matter—it is all over the place, every second day?

Hon Dr MICHAEL CULLEN: I would not be surprised by the latter. Given the nature of two or three conversations I have had with Mr Key about the trans-Tasman therapeutic goods agency, that would not surprise me at all.

Hon Bill English: Can the Minister confirm that the little ploy of pretending that New Zealand First might have an amendment that he might entertain and might send to a select committee will go down the drain in exactly the same way as the mortgage interest levy, the capital gains tax, the ring-fencing of housing investment losses, and the select committee inquiry into monetary policy, all of which are attempts by him to avoid any responsibility for the highest interest rates in the OECD and the highest exchange rate the country has ever seen?

Hon Dr MICHAEL CULLEN: It is interesting that the member thinks that an exchange rate of about 79c to the US dollar is the highest rate we have ever seen. It used to be about three times that, at one point.

Hon Bill English: Does the Minister agree that the credibility of his economic management is shattered; and when every time he proposes another way of avoiding responsibility it gets trashed and interest rates and exchange rates go up, will he please stop doing that?

Hon Dr MICHAEL CULLEN: Actually, the most important thing the Government is doing in that respect is to increase New Zealand savings, to be a net saver itself, and to promote savings by New Zealanders. All of that has been opposed by the National Party at every point along the way. It is a purely destructive party with not a single idea for the future, except going back to the past. That man is the Macaulay Culkin of New Zealand politics.

Rt Hon Winston Peters: I seek leave to table two pages from the Oxford Dictionary—one describing the word “conservative” and the other one describing the word “reactionary”.

Leave granted.

Hon Trevor Mallard: Is it the Minister’s view that section 12 is in the Act for very good reasons, and is he prepared to indicate to the House now that he will never rule out its use?

Hon Dr MICHAEL CULLEN: Section 12 is clearly there for very good reasons. It was put in by the fourth Labour Government, though I should note that the National Party at the time had great trouble in making up its mind whether to support the passage of the Reserve Bank of New Zealand Act. I would certainly not rule out the use of section 12.

Research Funding—Sustainability and Economic Transformation

2. Dr ASHRAF CHOUDHARY (Labour) to the Minister of Research, Science and Technology: How is the Government’s research funding contributing to sustainability and economic transformation?

Hon STEVE MAHAREY (Minister of Research, Science and Technology): This morning the Foundation for Research, Science and Technology announced the results of its biggest research investment in 4 years, involving $628 million in total contracts over the next 8 years. This will target key priorities, with $150 million to investigate how to promote sustainability and to respond to climate change and $311 million to boost the primary sector. All this research is designed to transform the New Zealand economy.

Dr Ashraf Choudhary: Has he received any reports on the international competitiveness of the research and development credits announced in Budget 2007?

Hon STEVE MAHAREY: The research and development tax credit was a $630 million investment made in an effort to encourage the private sector itself to invest in research, and the response from overseas has been very positive. I report, for example, that Deloitte’s Australian research and development tax expert Serg Duchini said that, all things being equal, it definitely increases the attractiveness of undertaking research and development in New Zealand over Australia, and David Gelb of KPMG in Australia has stated: “There are companies which in the past have relocated R and D facilities from New Zealand to Australia. This may well reverse that trend.” I think the research and development tax credit has been extremely well received.

Hon Brian Donnelly: Can the Minister confirm that biotechnology, upon which the Government is pinning some of its hopes for economic transformation, has not shown returns on investment internationally at this point in time?

Hon STEVE MAHAREY: Not just this Government but many Governments have identified biotechnology as the future of science. Of course, in a biologically based economy one would expect us to be investing in that area. Therefore, for example, the member might be encouraged by the fact that one of the contracts signed in the biotechnology sector in New Zealand last year was the sixth biggest contract around biotechnology in the world last year. So we are now beginning to see the chain of investment come to fruition.

Hon Brian Donnelly: I raise a point of order, Madam Speaker. The question I asked was about whether biotechnology has shown returns on investment internationally. The Minister did not approach that question, at all.

Madam SPEAKER: I thought that the Minister had addressed it, but if he wishes to address the international aspect of it, he may.

Hon STEVE MAHAREY: If I understand the question correctly, the example I chose was an American co-investment with us that resulted in it being the sixth largest in the world last year. So internationally we are beginning to see our biotechnology begin to get investment of the kind that we are after.

Hawke’s Bay District Health Board—Conflict of Interest

3. Hon TONY RYALL (National—Bay of Plenty) to the Minister of Health: Why did he say, regarding the conflict of interest allegations at the Hawke’s Bay District Health Board, that “I feel anxious about troubling the Auditor-General over something which is almost nothing.”, and is he confident that the investigation headed by Syd Bradley, who was appointed to chair the Canterbury District Health Board by the Hon Annette King, with whom he reportedly has a “strong relationship”, has the powers to appropriately investigate these matters?

Hon PETE HODGSON (Minister of Health): The Auditor-General can decide whether to investigate something when invited to by me, by any member of this House, or by any other person, or he can decide to do so on his own volition. As I said yesterday, the audit committee of the Hawke’s Bay District Health Board has already investigated conflict of interest issues surrounding Mr Hausmann. But at Mr Hausmann’s request to me, I asked the Director-General of Health to arrange a further review of the same issues. My best guess is that the review will come to similar findings, as did the audit committee. But the terms of reference are wide, so that any stone that might need turning can be turned. If the Auditor-General wants to involve himself, he will. So far, he has chosen not to, beyond the usual audit cycle.

Hon Tony Ryall: How can the public have any confidence that an inquiry headed by Mr Syd Bradley, who was appointed by Annette King, who appears to be involved in some of the complaints that have been made publicly about this matter, can provide a full and fair inquiry?

Hon PETE HODGSON: If my memory serves me correctly, I can say that Mr Bradley was first appointed to health positions by a National Government. However, matters have shifted, and Mr Bradley has written to the director-general earlier this week to say that because of changed personal circumstances he is obliged to withdraw. The director-general has appointed Mr Ian Wilson, chair of the MidCentral District Health Board, as the new chair of the review, and a press statement to this effect either has been released or soon will be. I can say that the review team has, or is about to have, today, its first meeting.

Maryan Street: Are the conflict of interest provisions in the law sufficient, or is the Minister considering an upgrade?

Hon PETE HODGSON: The ministry advice is rather strong, and it is that the law as it stands is robust. However, it has one obvious weak link, which is that it requires honesty on behalf of board members. Mr Housemann’s declaration of interest is, to my knowledge, complete. Dr Bierre’s was not, and, as a result, a contract worth many, many hundreds of millions of dollars came tumbling down.

Hon Tony Ryall: So is the Minister confirming in the House today that the Government’s hand-picked appointee, Syd Bradley, has thrown in the towel on this inquiry and that the public will be expected to rely on an inquiry of another appointee of the Minister of Health; and is he actually admitting that even one of the Government’s favourites can smell the stench of cronyism around the sham inquiry that this Government has set up?

Hon PETE HODGSON: The facts of the matter are a little more tame. Mr Bradley was not chosen by me. He agreed to head this inquiry when approached by the director-general—not by me, nor on my advice—last week.

Hon Bill English: He was in your office that day.

Hon PETE HODGSON: Last week—

Hon Bill English: Yes, he went to your office.

Hon PETE HODGSON: He did not—

Madam SPEAKER: Please be seated. The Minister was asked a question; he is attempting to answer it. If there are to be other questions, they can be asked when there is a supplementary question, not during the answer to a question.

Hon PETE HODGSON: Last week the director-general announced that Mr Bradley would head the review team. This week Mr Bradley advised the director-general that because of changed circumstances to do with overseas travel, he was unable to. Therefore, the director-general approached Mr Wilson. Mr Wilson agreed and his appointment has been, or will be, announced, and the first meeting of the review team has been under way earlier today, or will be under way later today—I am not sure.

Hon Bill English: Without a chairman.

Hon PETE HODGSON: No, with a chairman.

Hon Bill English: Which one?

Hon PETE HODGSON: Ian Wilson.

Madam SPEAKER: Is that a supplementary question? I want the House to settle before I call the next supplementary question.

Hon Tony Ryall: How can the Minister say there is nothing wrong here, when these emails show that the chief executive of the Hawke’s Bay’s District Health Board asked for a confidential copy of a $50 million tender proposal to be sent to Mr Housemann 2½ months before any other tenderer got to see the documents, and while Mr Houseman’s appointment to the district health board was being fast-tracked by the Government?

Hon PETE HODGSON: The issues that the member raises—and he scrapes with all the conspiratorial intentions that we would expect of a hollow man—were looked at in the first instance by the audit committee of the very board that Mr Housemann—

Hon Bill English: They abandoned the contract.

Hon PETE HODGSON: They did dump the contract, and they did find also that Mr Housemann had not been particularly advantaged by it. However, Mr Housemann, concerned that the allegations continued to simmer, wrote to me saying that he would like a further review, and I decided that he should have one.

Hon Tony Ryall: Will the Minister explain this email of 10 May 2005 from the executive assistant of the district health board’s chief executive, Chris Clarke, sent to a senior manager at the district health board: “Chris has asked if you could send Peter Hausmann a copy of the RFP for community services pointing out that it is confidential.”; why would the chief executive officer be sending an advance copy of a commercially sensitive document to a bidder 2½ months before the tender was publicly notified and when that chief executive knew that that contractor was about to be appointed to his board?

Hon PETE HODGSON: That is precisely the reason, I presume, that Mr Hausmann wrote to me asking that these matters be investigated afresh. Those are the sorts of simmering allegations that continue, despite the fact that the audit committee of the Hawke’s Bay District Health Board looked at it around February-March 2006. It found that no particular advantage had accrued to Mr Hausmann, and the contract was stopped. That is what a board does. That is its job, if it thinks that there is anything unsafe about process. What has happened since is that the allegations against Mr Hausmann continue to simmer. He wants them cleared up. He asked me for a review. I asked the director-general whether he would arrange such a review, and the review is under way.

Heather Roy: Are there not strong parallels in process between Hawke’s Bay District Health Board’s conflict of interest situation with board member Peter Hausmann, and that at Capital and Coast District Health Board, where deputy chair, Ken Douglas, stood aside in March, citing a conflict of interest; and is he confident that the process used by the previous Minister of Health to appoint Mr Hausmann was appropriate and that best practice was followed?

Hon PETE HODGSON: In respect of the second part of the question, yes, and I explained why in some detail in the House. All of the papers concerning that gentleman’s appointment were released to the National Party 20 months ago. If National members opposite have lost them in the meantime, I am happy to give them another copy, but they should stay on top of the job. That is how long they have had them. In respect of the first part of the question, the whole point of the conflict of interest legislation in this country is not so that people with a conflict of interest are never appointed to a board. By way of example, nearly all of the members of the Auckland District Health Board have a conflict of interest. That is not the issue. The issue is how it is managed. Mr Hausmann’s conflict of interest formed part of the original Cabinet paper, so the whole Cabinet knew that he was conflicted, as indeed—

Hon Dr Nick Smith: So the whole Cabinet knew?

Hon PETE HODGSON: Well, since we are saying that, let me just say some more. Many, if not most, district health board appointees have a conflict of interest or a potential one, including, for example, a member in National’s own ranks, Jackie Blue, when she was a member of the Auckland District Health Board. It is not the conflict that matters; it is being honest about it.

Hon Tony Ryall: Is the Minister of Health telling Parliament today that Cabinet was aware that Mr Hausmann was commenting on the confidential draft tender documents for the $50 million community services, that he declared that in his interview with the Ministry of Health, and that it was advised to the Cabinet that he was commenting on these commercially sensitive tender documents—is the Minister saying he knew?

Hon PETE HODGSON: What Cabinet was advised of was that Mr Hausmann holds a position with a health provider—a significant health provider—and that that is an obvious conflict of interest. Cabinet was also advised that Mr Hausmann understood his obligations to manage that conflict of interest.

Hon Tony Ryall: Is the Minister endorsing as acceptable that some 2½ months before the opening of a $50 million tender, and at the same time as Annette King was fast-tracking Mr Hausmann’s appointment to the Hawke’s Bay District Health Board, the Hawke’s Bay District Health Board boss, a former personal assistant to Helen Clark, was wanting to send an advance copy of the $50 million tender documents to Mr Hausmann and telling him to keep them confidential—can he not smell the stench of cronyism around this?

Hon PETE HODGSON: As to the issue of the appointment, can I just assure the House once more that Mr Hausmann’s appointment to the Hawke’s Bay District Health Board was unexceptional in every respect. In respect of the issue of the request for proposal that was disallowed by the audit committee in, I think, February or March of 2006, that is what a board’s job is—to look at any issues that might be unsafe and to come to a view about them. In respect of the last matter of why it is that these issues continue to recur, Mr Hausmann wants to know the answer to that question, which is why he asked me to put forward a review. The review, by the way, has terms of reference that are sufficiently broad that any matter can be investigated.

Dr Jonathan Coleman: What do you think the public makes of all this cronyism when the district health board chief executive, who just happens to be Helen Clark’s former assistant, rorts a $50 million contract by giving his mate a copy of the documents—

Hon Trevor Mallard: I raise a point of order, Madam Speaker. The member has been here for some time and I think he should know by now that he should not ask you questions as he did.

Madam SPEAKER: Yes, I do remind the member, who has been here a while, that when he has plenty of time to think about his question he puts it—[Interruption] Be seated while I am on my feet. That is also a rule in this House. When the Speaker stands, members sit. I just ask the member please to rephrase his question consistent with the normal rules.

Dr Jonathan Coleman: What does the Minister think the public would make of all this cronyism when the district health board chief executive, who just happens to be Helen Clark’s former assistant, rorts a $50 million contract by giving his mate a copy of the documents months before anyone else, at the same time as the Minister of Health is fast-tracking the same mate on to the same district health board that is about to award the $50 million contract?

Hon PETE HODGSON: The member has now, in my view, crossed a line and has started to impugn the integrity of very good servants of the New Zealand health system, without a lot of evidence. There was no $50 million contract. This was a precursor to a request for proposals. The issue will be further examined by a quality review team. The results will be made available to the director-general, he will make them available to me, and I will make them available to this House. We will wait for that; why do we not?

Hon Tony Ryall: Does the Minister think it appropriate that a chief executive of a district health board should make available to one preferred bidder a copy of that request for proposal some 2½ months before it was made available to any other bidder, and ask for comment on it; is that appropriate behaviour?

Hon PETE HODGSON: I am sorry if I am sounding repetitive, but these are the issues that will be, or might well be, subject to discussion by the review team. That is why we have the review team; they have been set up to look at the review. These things are usually managed by the Hawke’s Bay District Health Board, or the district health board in question, itself. In this instance, however, the district health board has looked at it and found no material advantage—or words to that effect—to Mr Hausmann, but the rumours continue, so we will have a fresh look. Members opposite can continue to rumour-monger and quote emails out of context for as long as they like, but the fact of the matter is that it was a member of their own party in another district health board who was not honest and who brought down a multimillion-dollar contract. That is serious indeed. That is the worst thing that has happened in the history of the New Zealand health system as far as conflict of interest is concerned.

Hon Tony Ryall: I seek leave to table three emails released under the Official Information Act relating to the chief executive’s instruction that a copy of the confidential request for proposal for—

Madam SPEAKER: Leave is sought to table those documents. Is there any objection? There is objection.

Hon Tony Ryall: I seek leave to table the media release from the Hawke’s Bay District Health Board advising the request for proposals called on 28 July, 2½ months before—

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

Hon Dr Michael Cullen: Can I ask the Minister to confirm that the relationship between the chief executive of the district health board and the Prime Minister was when Mr Chris Clarke was, I think, a Treasury official working on secondment for Helen Clark in the 1980s?

Hon PETE HODGSON: My memory is stretched, but I do believe that it was around 1988 or 1989. It is also a matter of fact that Chris Clarke is not appointed by this Government. Chris Clarke is appointed by the board. Trying to get a linkage when there is as much distance as that between one set of people and another—

Hon Tony Ryall: You are sensitive.

Hon PETE HODGSON: I am not sensitive at all. I am very, very open to the idea of a full inquiry, and it was I that asked that the terms of reference be broad enough to cover all matters. They can cover all matters, and the member needs to be just a little patient.

Film Industry—Government Assistance

4. LYNNE PILLAY (Labour—Waitakere) to the Minister for Economic Development: What is the Government doing to support the development of the New Zealand film industry?

Hon TREVOR MALLARD (Minister for Economic Development): We are boosting the film industry by improving the Large Budget Screen Production Grant and providing ongoing funding for Film New Zealand. We know that large-budget productions hold fantastic opportunities for our country and we want to take full advantage of these. In particular, the post-production digital and visual effects incentive recognises New Zealand’s strengths in design. This boost to our film industry is important to New Zealand’s transformation into a high-wage innovative economy. I note that it is broadly supported by everyone other than Rodney Hide and the editor of the Dominion Post.

Lynne Pillay: What other reports has he seen on action the Government is taking to support economic transformation?

Hon TREVOR MALLARD: The other main announcement was around the food and beverage sector. We know that farming has traditionally been the backbone of our economy but we do need to think differently to really drive future growth in the food and beverage sector so that innovative nutrition solutions can be the new backbone to this economy.

Teachers Council Disciplinary Tribunal —Internet Sex Sites

5. KATHERINE RICH (National) to the Minister of Education: Does he back the recent decision of the Teachers Council Disciplinary Tribunal to allow an art teacher who posted hard-core pornographic pictures of himself and two women on Internet sex sites, with messages for girls “the younger the better” to contact him, to continue teaching; if so, why?

Hon STEVE MAHAREY (Minister of Education): The Teachers Council disciplinary tribunal is a quasi-judicial body, and I am proscribed from directing the actions of the Teachers Council over a particular individual, nor can I overturn its decisions. I would, however, note that it was a split decision. I also inform the House that the Teachers Council is reviewing its criteria in order to tighten up on cases like this. Secondly, I would note that a Cabinet paper is being drafted to look at privacy issues to ensure that there is better data-matching between the Teachers Council and the Ministry of Education. Thirdly, I would note that the teacher does not have a current practising certificate and is not employed at any school.

Katherine Rich: Can the Minister answer my primary question, which was: does he back the Teachers Council disciplinary tribunal’s decision to allow someone who has published hard-core pornographic images of himself and others, and advertised for girls as young as 17—the age of some of his potential students—to continue teaching, when some of those dissenting tribunal members went on to say that such behaviour “adversely affects, or is likely to adversely affect, the well-being or learning of one or more students.”?

Hon STEVE MAHAREY: I want to answer the question directly by saying of course not.

Hon Dr Nick Smith: Do you back the decision or not?

Hon STEVE MAHAREY: Of course not—I know the member is a little deaf, but of course not. What I said originally, though, is that the Minister of Education is proscribed from doing anything directly about an individual decision. But I applaud the fact that it was a split decision, and I know which side of the decision I would have been on if it had been me. Therefore, I also listed the fact that I applaud the Teachers Council for reviewing its criteria, and I applaud the fact that it will have legislation to allow it to data match, and I am very glad that this person does not have a teaching certificate and is not in front of a class now.

Dianne Yates: What has the Labour-led Government done over time to ensure a high standard of conduct on behalf of teachers?

Hon STEVE MAHAREY: I should note for the House that through most of the 1990s the registration of teachers was completely voluntary. Registration became mandatory in 1997 but there was no requirement for police vetting of teachers before they were employed at schools. However, in 2001 this Government changed the Education Act to require police vetting for all personnel occupying positions in schools and early childhood centres. The Act also established the Teachers Council, including a disciplinary tribunal with powers either to deregister teachers or to impose conditions on their ongoing registration. In 2004 new rules came into effect enabling the council to consider complaints of serious misconduct at any time rather than wait for the expiry of the current registration. Those arrangements are ones that can give us confidence in a robust professional process, but I repeat that I applaud the fact that the Teachers Council is now reviewing again its criteria and that it will have changes in the Privacy Act to assist it, and that I am very pleased that this person is not teaching anywhere right now.

Katherine Rich: How can the Minister be absolutely sure that this teacher is not teaching in a New Zealand classroom today when the Teachers Council has told our select committee that it currently has thousands of unregistered teachers teaching in New Zealand classrooms and that it does not track censured teachers in any way in the workplace once that censure has been given?

Hon STEVE MAHAREY: I can only give the House the assurance that I have checked today and asked whether this person has a current practising certificate, and the answer was no. I checked whether the person is currently employed, and the answer was no. That is all I can give the House.

Katherine Rich: What changes to the Teachers Council is he proposing because the situation it found itself in, with two dissenting members and a casting vote being made on such a controversial decision, is basically a result of a structure he set up?

Hon STEVE MAHAREY: If the member cares to have a look at the dissenting opinion she will note that it pointed out that the criteria were a problem in this particular area for people who had dissented. They believed that there ought to be different criteria. That is what has led to them now reviewing their criteria—they believe that they need to have different criteria to work on. I believe that is a very good step to take.

Katherine Rich: Does the Minister accept that it is his criteria, set up by his Government, that they are using, and what changes is he proposing; and does he accept that his ivory-tower argument that the difference between misconduct and serious misconduct is largely academic, as most parents would be horrified to think that someone who had posted hardcore porn pictures of himself and had actively sought out young girls could be allowed to teach in New Zealand classrooms?

Hon STEVE MAHAREY: The member may be seeking a disagreement when there is not one. I do not think anybody in the House disagrees with her on the fact that this person should not be teaching in a New Zealand school. What we are saying here is that the Teachers Council understands that the criteria should be changed. The member asks what is changing; the criteria are changing. We will ensure that the Teachers Council, which we agreed last time we had a debate about these kinds of issues has a robust and professional approach, has an even better one.

Electricity Supply Companies—Social Responsibility

6. LESLEY SOPER (Labour) to the Minister of Energy: What is the Government doing to ensure that social responsibilities are taken seriously by electricity companies?

Hon DAVID PARKER (Minister of Energy): Legislation introduced today by the Labour-led Government will increase the threshold for eligibility for the low fixed-charge from 8,000 kilowatt-hours to 9,000 kilowatt- hours per year for domestic consumers from Christchurch to Bluff, excluding the West Coast. Increasing the threshold for colder parts of the South Island makes the scheme fairer, and it means that tens of thousands of families will be better off.

Lesley Soper: Can the Minister please inform the House how the Government is going to ensure that the interests of vulnerable customers are further protected?

Hon DAVID PARKER: Procedures for electricity companies are being strengthened to ensure that the electricity of vulnerable consumers like the Muliaga family is not wrongly cut off. The bill being introduced today will ensure that the Government can regulate to impose those rules if retailers do not adhere to them voluntarily.

Jeanette Fitzsimons: When the Minister received a Ministry of Economic Development report in March last year on progressive pricing, whereby a basic block of power is sold to each household at a low price with higher consumption costing more, was he satisfied with the advice in the report that although basic needs would be more affordable and we would be likely to have more conservation of energy, progressive pricing was not recommended because, and I quote the report, “this is not compatible with competitive market arrangements”?

Hon DAVID PARKER: I do recall the report, and I do agree with the advice that progressive pricing, although on its face apparently appealing, is so problematic as to be impossible to implement fairly. The main reason for that is that progressive pricing does not properly cater for the differing circumstances of large families compared with small families. The effect of progressive pricing would be to make power cheaper for a dual-income, high-income family living in an Auckland apartment, and more expensive for a low-income family of five living in South Auckland.

Jeanette Fitzsimons: I raise a point of order, Madam Speaker. My question related specifically to whether the Minister was happy with the advice that progressive pricing should not proceed because it was not compatible with competitive market arrangements. The Minister did not address that issue

Madam SPEAKER: Does the Minister want to add to his answer?

Hon DAVID PARKER: I am quite happy to reinforce the point that the reason I did not proceed further with progressive pricing was that it would be unfair to a large, low-income family compared with a small, high-income family—a problem that cannot be overcome. The Government is implementing measures to increase the efficiency of use of electricity by all consumers, which is a more appropriate way to address the issue.

Peter Brown: Noting the Minister’s answers to the principal question and to the first supplementary question, will he give the House an assurance that if a contractor who walks into a house to turn the power off sees somebody on a life-support system, the contractor will have the common sense and the compassion to least check with somebody? There is a limited time frame to take any positive action, and we want to ensure that the circumstances that occurred a few weeks ago do not occur again. Will the Minister guarantee that they will not happen again?

Hon DAVID PARKER: Yes, the rules will say that. I would also say, though, that we should not need rules for that to happen; basic human decency, I would have thought, would cause that checking to occur, irrespective of the rules. I am hopeful that the electricity companies will agree to do it voluntarily, and we will not need to use these regulatory powers, but if we need to use them we will.

Housing New Zealand Corporation—Confidence

7. PHIL HEATLEY (National—Whangarei) to the Minister of Housing: Does he have confidence in Housing New Zealand Corporation; if so, why?

Hon CHRIS CARTER (Minister of Housing): Yes; but there is always room for improvement.

Phil Heatley: Is the Minister at all concerned that the corporation allows 7,064 of its tenants to rent extra rooms to paying boarders—1,740 of whom are renting to non-family boarders—when thousands of large families on the waiting list are struggling in cramped conditions; if so, what is he doing about it?

Hon CHRIS CARTER: The ability of Housing New Zealand Corporation tenants to allow boarders in their houses has been a long-standing practice. It is one, I believe, that existed right through the nine years of the National Government, and for very good reasons. Many of those boarders are young people who are starting work, or older people who are living with families. We provide that provision so that people can have a normal family life.

Russell Fairbrother: Is Housing New Zealand Corporation delivering on the Labour-led Government’s manifesto commitment to provide affordable, good-quality housing for those on low or modest incomes?

Hon CHRIS CARTER: It certainly is. For example, in the last 7 years we have added more than 7,000 new homes, and indeed we had to, because Murray McCully and his National mates sold off 13,000 of them, mostly to developers. We have introduced fair and affordable rents, whereas in the 1990s State house tenants were forced out of their homes by high rents and replaced by the very market renters that Mr Heatley now wants to throw out. Finally, we have been funding local authorities and organisations like Abbeyfield to develop their own social housing complexes—groups that National continues to ignore.

Phil Heatley: Why is there a tenant in Māngere with five paying boarders, when the waiting list in Māngere has 280 families categorised as having “severe and significant housing needs” who are probably all living in cramped and unhealthy conditions, and all of whom could do with this larger home with five boarders living in it?

Hon CHRIS CARTER: For the reason I explained earlier, which was perfectly acceptable to National in its 9 years in Government, State house tenants are allowed two boarders. For every boarder over that they pay a market rent that is assessed as part of their income. I would think those boarders would be really, really grateful for some of the 13,000 houses that that member’s party sold off.

Phil Heatley: Is it still the case that State house tenants can charge boarders what they want to, even if it is over the rent that they pay, and what is more, that they do not have to pay extra rent to Housing New Zealand Corporation until they have three or more boarders; if so, does the Minister think it is right for them to profit from their spare rooms while large families languish on the waiting list?

Hon CHRIS CARTER: Once again, the member deliberately tries to mislead the House. State house tenants are allowed two boarders, as they have been since the 1970s. It is something the National Party never changed because—like the Labour Party—I assume it thought it was good for young people in employment to stay with their parents or for older people to stay with their families. For any other tenants above that number, State house tenants pay a market-related rent, because their income from rent is assessed as part of their income. Again, I remind this House that if National had not hocked off 13,000 houses, we would not have a waiting list.

Phil Heatley: Why is it that when he and Mr Bridgeman of Housing New Zealand Corporation promised, in 2005, that they were going to review the boarder problem there were 6,931 State boarding houses and now, 2 years later, there are 7,064?

Hon CHRIS CARTER: We do not have a problem with people allowing boarders to stay in their houses. I have already explained twice today in this House why State house tenants are allowed to have boarders, and why they are allowed to have two boarders without that being assessed as part of their income. It is so that families can stay together. We would not have a problem about a waiting list if National had not sold 13,000 State houses, mostly to the speculator mates of its members.

Phil Heatley: What is he doing to shift at least the 1,700 State house tenants who have non-family boarders into smaller houses, so that desperate families on the waiting list can live in less crowded and healthier conditions?

Hon CHRIS CARTER: Already in the last year we have moved 303 tenants into smaller houses, thus saving the taxpayer $300 million and releasing new housing opportunities for people on the waiting list. Quite frankly, it is hard to listen to the questions from that member—a member of a party that sold off 13,000 houses when it was in Government.

Phil Heatley: I seek leave to table estimates questions that show 7,000 tenants rent out extra rooms, many of them to three, four, or five boarders.

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

Phil Heatley: I seek leave to table an article from 2005 that states that the Minister was getting on to it.

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

Housing—Overseas Buyers

8. PITA PARAONE (NZ First) to the Minister of Finance: Does he still believe that overseas buyers buying residential property are not one of the major drivers of the increase in housing costs, especially given that the Reserve Bank, in its June Monetary Policy Statement, said it could not confidently say what the impact of foreign buyers on the property market was, but that it was “quite influential” in some areas; if so, on what information does he base his belief?

Hon Dr MICHAEL CULLEN (Minister of Finance): The available evidence is from the Inland Revenue Department and from Quotable Value, and continues to suggest a limited impact by foreign buyers. The most recent Reserve Bank Monetary Policy Statement makes the same point. But I have asked for further work on the extent of foreign purchasing, given some concerns about the quality and the coverage of the data.

Pita Paraone: Why does the Government consider that lowering its resident migrant target is an important means of easing inflationary pressure, yet it does not consider collecting information with which to properly judge the impact of foreign buyers on price inflation within our housing market to be important enough for it to gather?

Hon Dr MICHAEL CULLEN: As I said, I have asked for some work to be done on this matter to see whether the numbers are significantly larger than the data shows. I remind the member that the Reserve Bank Monetary Policy Statement he refers to concludes: “However, on the limited evidence we have, it appears that any national effect is likely to be small.” One thing that all the data does strongly suggest is that the rate of foreign purchasing has tailed off over the last couple of years or so, which is to be expected given the high level of the dollar, of course.

Dr Pita Sharples: Tēnā tātou katoa. Does the Minister recall the comment of the New Zealand Council of Trade Unions President, Ross Wilson, that homeownership is increasingly out of reach for low and middle income New Zealanders, because house prices have increased by 38.5 percent in the last 3 years, outstripping wages by 4:1; and what actions will the Minister be taking to address the housing affordability crisis?

Hon Dr MICHAEL CULLEN: There are a number of actions—almost too numerous to mention. Obviously, the growth of KiwiSaver will, first of all, divert a good deal of investment income away from purely property income, into other vehicles. We need people to be investing in more than simply the property asset class within New Zealand. Within KiwiSaver, there is assistance for the first-home buyer, which is quite significant assistance, as time builds up. The Government has a range of other programmes, which my colleague the Minister of Housing has outlined to the House on a number of occasions. Of course, at the point where we do start to enter the monetary policy easing cycle, interest rates will have come back. Already we see some signs of some easing in the housing cycle, but, as yet, not very strong signs.

Pita Paraone: Does the Minister agree that as our dollar readjusts downward, foreign buyers will find themselves in an increasingly strong position to buy our property; if so, why does he not accept that it is important to at least know the situation now, before the trickle of foreign buyers turns to a flood, and the situation for Kiwis buying a home worsens considerably?

Hon Dr MICHAEL CULLEN: One of the issues we do not know about is the extent to which foreign purchasing is counter-cyclical or pro-cyclical in the housing market. In fact, for the monetary policy cycle to ease requires that the rate of growth in house prices also ease. Of course, this is the irony of the situation: if houses become cheaper, they are easier to buy; if the dollar comes back down, they are easier to buy. I am sure nobody in the House will be arguing against a slowing down in the rate of house price increases, or arguing for the dollar to continue to push upwards. It has to be remembered also that quite a lot of these purchasers appear to be in two categories: firstly, New Zealanders overseas who, at some point, are intent on returning home to New Zealand; and, secondly, foreigners who are intent on coming to New Zealand.

Dr Pita Sharples: I seek leave to table the article by the New Zealand Council of Trade Unions headed “House prices outstripping wages”.

Leave granted.

Benefits—Single Core Benefit

9. JUDITH COLLINS (National—Clevedon) to the Minister for Social Development and Employment: Does he stand by his statement in the House on 22 May 2007 in relation to the single core benefit that “phase two will be introduced when Cabinet makes appropriate further decisions.”?

Hon DAVID BENSON-POPE (Minister for Social Development and Employment): Yes. It will be no surprise to the member that Cabinet needs to approve the detail of phase two before it is implemented. Phase one, I am pleased to tell the House, is progressing well, and, as I informed the member on 14 June, 13 June, 24 May, and 22 May, phase two is about further simplifying the benefit system so as to better align individual needs with support services. That phase is currently being worked on by officials, and final decisions about the detail of phase two will be made in 2008.

Judith Collins: When and why did the single core benefit become phase two of the Working New Zealand reforms?

Hon DAVID BENSON-POPE: I know that an Official Information Act request released recently to the member makes it clear that the Cabinet decision was to split that policy development. I can provide her with the exact date in due course. I do not have it in front of me at this time.

Steve Chadwick: Can the Minister advise what success Work and Income has had to date in supporting New Zealanders into work?

Hon DAVID BENSON-POPE: I am pleased to advise the House that in 1999 the total number of working-age clients receiving a benefit of any kind was 401,415. That number currently, as of June this year, is 261,009—for all benefits received—and is a 35 percent reduction. In respect of the total number of people receiving the unemployment benefit, the reduction is, however, 86 percent, from 161,000 to 23,000 last month. Māori figures show a reduction from 44,378 to just 7,873 in June, which is an 82 percent reduction. For Pacific Island recipients, the reduction is from 12,317 in December 1999 to 1,753 now, which is an 86 percent reduction. Probably the most pleasing statistic for members to hear is the reduction in the category of 18 and 19-year-olds receiving the unemployment benefit, from 17,514 under National to just 990 this month.

Judith Collins: Will the Minister confirm that he, the Prime Minister, and Steve Maharey met on or about 15 August 2006 and decided to abandon the single core benefit, but, to save face and to avoid announcing that decision, they chose to rename it phase two, and will the Minister now admit that phase two will never happen, because the single core benefit has been abandoned?

Hon DAVID BENSON-POPE: I can confirm no such thing, but I would say that it must be obvious to the member that the Government would, understandably, focus on the success of phase one of that project. Not only have we seen the extraordinary achievements that I have just detailed, but some of the more lasting legacies of the National Government have already been significantly attacked. For example, the member will be interested to know that the number of people receiving an unemployment benefit for more than a year has reduced by 86 percent since these policies were introduced. The number of Māori long-term unemployed—for more than 1 year—has also seen massive drops, from 20,500 under National to just 2,916 under Labour. Similarly, those successes are mirrored by the results for Pacific Island recipients. In December 1999 over 5,600 Pacific Islanders had been receiving a benefit for longer than a year; in June this year that number was 711.

Judith Collins: Is it not true that until that meeting between the Minister, the Prime Minister, and Steve Maharey, when the single core benefit was secretly shelved, the single core benefit was the key feature of Working New Zealand single core benefit reforms, and that what the Minister now calls phase one reforms were only ever designed to enable the implementation of the single core benefit, which was the policy Labour campaigned on in 2005?

Hon DAVID BENSON-POPE: I say to the member that she allows her fantasy to run away with her.

Judith Collins: I raise a point of order, Madam Speaker. That was not addressing the question.

Madam SPEAKER: Would the Minister like to add a further comment?

Hon DAVID BENSON-POPE: If the member wants a specific, short answer, the answer is no.

Judith Collins: Why did the Minister rush ahead with legislation to implement phase one, even though those changes were designed to support the implementation of the now shelved single core benefit, when the benefit had already been abandoned, and when the repeated and strenuous advice from Treasury was that the phase one reforms do not offer value for money and that we can get better value for money in other ways?

Hon DAVID BENSON-POPE: I think the numbers speak for themselves. Frankly, I am not sure I would wish to tempt the patience of the House by repeating them. Clearly, the value to this community, to this economy, and to New Zealanders of making that huge inroad into the number of New Zealanders whom the National Government left on the scrap heap has been very good value for money indeed.

Judith Collins: Does the Minister agree with the following statements from Treasury in relation to phase one of the Working New Zealand reforms: “There are major issues with parts of the proposals with respect to value for money.”, “The phase one proposals do not offer value for money.”, “The proposals do not offer value for money.”, and “Treasury has concerns about the value for money of this additional spending.”?

Hon DAVID BENSON-POPE: It is nothing new for that member to provide selective quotes out of documents she has received. What I would say is there is absolutely no doubt of the difference between the policy delivery of that party, which left 161,000 people receiving the unemployment benefit, and the policies of this party, including Working New Zealand, which saw that number at 23,000 last month.

Far North District Council—Flooding of Towns

10. HONE HARAWIRA (Māori Party—Te Tai Tokerau) to the Minister of Local Government: He aha atu ngā whakamaherehere kua whiwhi i a ia mai i te Kaunihera ā-Rohe o Muriwhenua whai muri i tā te Pirimia i kī rā, whiriwhiria, wānangahia e ngā kaunihera ā-rohe ngā take, ki hea ngā tāone tū ai?

[What advice, if any, has he received from the Far North District Council following the Prime Minister’s reported comments that local councils need to talk through issues about where towns are situated?]

Hon MARK BURTON (Minister of Local Government): I have not received any advice directly from the Far North District Council, although I am sure the member can understand that it is somewhat occupied at this time. But I have had the benefit of direct advice from my colleagues, including the Prime Minister, Rick Barker as Minister of Civil Defence, and local MPs Dover Samuels and Shane Jones. I agree with the Prime Minister’s comment that in an age of human impact on climate change, the future-proofing of communities needs to be seriously considered. Both central and local government have a role to play in resolving issues such as the location of settlements and whether any engineering solutions could minimise the impact of changing weather patterns. We need to balance the right to determine where we live and how we live against the Government’s responsibility to ensure the security and safety of our communities.

Hone Harawira:

FTR 15:08:16

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

Hon MARK BURTON: I would say that it reinforces the point the Prime Minister was making—that the issues about the security and safety of our people in their communities are serious issues that need proper consideration. The answer to those questions may well be relocation in some cases, and in others, clearly not. In many situations it will be about finding solutions, and it may include engineering, elevating houses, and all manner of possibilities. But the issue is that we have to make changes in some situations in order to secure the safety and security of our people.

John Carter: Is the Minister aware that the council and the lead agencies called a meeting, sponsored by the local iwi, in Whangaroa - Kaeō on Monday—there are to be further meetings tomorrow and in a fortnight’s time—where the community came together to discuss the issue in a very positive way to the extent of considering the raising of houses, the widening of the river, land-management issues, the impact of roading and forestry, and perhaps addressing issues around stopbanks and silting; and can the Minister also advise whether he has the opportunity yet to discuss with the Minister of Agriculture the matter of the problem around the Hikurangi Swamp farmers and the devastation they are facing with having had two floods in 3 months?

Hon MARK BURTON: The latter matter is a matter that the member has raised with me, as have a couple of my other colleagues from the north. As to the former matter, yes, I am aware of that meeting. I think it illustrates the point I was making in the primary answer. It is encouraging that the local community is taking the initiative and understands that these are complex and serious issues. Local people will be at the heart of making the decisions about their own future.

Hone Harawira:

FTR 15:11:03

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

Hon MARK BURTON: I clearly cannot speak for Local Government New Zealand, but certainly central government has already made a number of provisions. Cabinet will continue to take advice on a daily basis as to further support that will be required to work alongside local government and local communities.

Question No. 3 to Minister

DARREN HUGHES (Labour—Otaki): During question No. 3 there were quite a lot of theatrics from Mr Tony Ryall about cronyism, so I seek leave to table a document showing that Chris Clarke worked as an executive assistant to Deputy Prime Minister Helen Clark on her health portfolio from 1989 to 1990, and prior to the appointment he was a Treasury official working in the housing portfolio, during which time he shared an office with then Treasury officer Bill English.

Leave granted.

Hon TONY RYALL (National—Bay of Plenty): I seek leave to table the biography of Mr Chris Clarke, which he proudly displays on the Hawke’s Bay District Health Board website, as he is very proud that he was executive assistant to the then Deputy Prime Minister Helen Clark.

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

Local Government—Council Sizes

11. JOHN CARTER (National—Northland) to the Minister of Local Government: Does he agree with the president of Local Government New Zealand that there is no one-size-fits-all solution to local government issues in New Zealand?

Hon MARK BURTON (Minister of Local Government): Indeed I do. That is why this Government is engaged in an ongoing and consultative working relationship with local government, in stark contrast to the icy relationship between the Beehive and local government during the 1990s. Our relationship is, I think, epitomised by the Central / Local Government Forum, which was jointly initiated and is co-chaired by Prime Minister Helen Clark and the president of Local Government New Zealand. This Government is committed to maintaining and building that strong working relationship.

John Carter: What advice has the Minister given to the Minister of Health regarding the inability of smaller rural and provincial councils to pay for the Labour Government’s one-size-fits-all approach to drinking-water standards; and what advice has he given to the Minister of Health regarding the statement of the president of Local Government New Zealand that the proposed drinking-water legislation is unnecessary and unjust?

Hon MARK BURTON: There is no need for me to give advice to the Minister of Health, because flexibility is provided for in the bill relating to drinking-water standards. It requires that councils take a responsible attitude. But I say to the member that it is just not good enough for the cloud-jumper to go to Dunedin and make a speech suggesting it is acceptable for people in small communities to have sub-standard water supplies. He would not accept that for his family in Auckland.

John Carter: What is the Minister’s reaction to research by Local Government New Zealand that shows councils are increasingly concerned that they do not have the resources or the funding to undertake all the functions devolved to them by this Labour Government?

Hon MARK BURTON: The member may be aware—I would have thought he would be, given the portfolio he carries as an Opposition spokesperson—that there has been a rate and funding review. That panel is due to report to me shortly, and that information will be of central importance to future funding arrangements. The member and his leader trot around the country suggesting that a lot of legislation—the quote is usually between 60 and 67 pieces of legislation—is being imposed on local government bodies without any assistance being given, which puts costs on them. But if we analyse the list the member puts forward, we see that 28 pieces of legislation were specifically asked for by local government and 26 of them have absolutely no cost attached to them. The facts, I say to Mr Carter, should occasionally get in the way of his statements.

John Carter: In view of that answer, what is the Minister’s reaction to the statement made by the Hamilton City Council—not me—that it has identified 60 pieces of legislation that impose compliance costs on local government without adequate resourcing and cost recovery tools?

Hon MARK BURTON: I would need the council to provide me with its evidence; I could not rely on it to come from over there. But I would say to the council that New Zealand ratepayers and residents of Hamilton City expect First World standards. They expect the conditions, water supplies, waste water disposal, and regulation of a First World community. That is a fact of life, I tell Mr Carter. They will not tolerate lesser conditions, and they ultimately expect to pay for fair services.

Food Safety—Exports from People’s Republic of China

12. SUE KEDGLEY (Green) to the Minister for Food Safety: Does she have any concerns about the safety of food imported from China, given a report earlier this year by the Asian Development Bank and World Health Organization which concluded that “Unsafe food in the People’s Republic of China remains a serious threat to public health.”; if not, why not?

Hon ANNETTE KING (Minister for Food Safety): Unsafe food is an important public health issue around the world. I am advised that the Chinese Government is taking that issue seriously within its own country. In relation to Chinese food imported into New Zealand, I am advised that New Zealand has systems in place to ensure that the food for sale in New Zealand, regardless of where it is from, is required to meet safety and suitability standards. We will always take food safety issues seriously, which is why we have a world-leading New Zealand Food Safety Authority.

Sue Kedgley: Is the Minister aware of another report, released a few weeks ago by a Chinese authority, that revealed that nearly a fifth of the food and other consumer products checked in China were found to be substandard or tainted with formaldehyde, illegal dyes, excessive preservatives, and additives; and is she aware of other reports that have found examples of farmed fish fattened on birth control pills, kids’ snacks laced with hormones, seafood contaminated with DDT, tomatoes contaminated with the banned pesticide Lindane, and pigs fed asthma medication in order to produce leaner and redder meat; if so, how can she guarantee that similarly contaminated products are not on sale in New Zealand?

Hon ANNETTE KING: I am aware of a number of reports coming out of China regarding food safety. I am also aware that the World Health Organization has said that it has not singled out China as being of particular concern over food safety. It is a problem in rich and poor countries, and—I ask you to listen to this, Madam Speaker—“must be tacked through better regulation”. I would also like to inform the House that none of the New Zealand Food Safety Authority’s range of testing programmes to date has found any serious issues with regard to levels of residue in food imported into New Zealand from China. The authority’s testing and surveillance programmes show that produce available within New Zealand, both imported and domestically produced, has extremely low levels of chemical residues.

Barbara Stewart: Does the Minister still consider it unnecessary for the country of origin to be displayed on food labels, as without that information New Zealand consumers are effectively denied their right to make informed choices about the food they buy?

Hon ANNETTE KING: Perhaps I could remind the member that in 2006 the Consumer’s Right to Know (Food Information) Bill came to this House. It was voted against by 99 members of this House, with 20 voting for the bill, because people in this House know that putting a label on a product and saying that it may come from somewhere does not necessarily tell us what is in that product. It could have a number of ingredients. Some could have come from one country, and some could have come from another. It may be a product of, or made, somewhere else. In fact, that label does not give the information that consumers seek. The best way for consumers to know what is in their food is to ensure, first of all, that they buy Kiwi-made products.

Sue Kedgley: Is she aware that testing of Chinese food at American ports found pesticide-laden pea pods, drug-laced catfish, filthy plums, and farmed seafood contaminated with carcinogenic compounds, and that, as a result, the Americans are turning away several hundred shipments a month and are putting very serious restrictions on farmed seafood; will the Minister agree, therefore, to follow the Americans and impose stricter testing—indeed, will she agree to random testing—on all food imports from China, to reassure the public that the food they buy in New Zealand that comes from China is safe?

Hon ANNETTE KING: I am confident that, with the work carried out by the New Zealand Food Safety Authority, food coming into New Zealand is safe. The Food Safety Authority has strong links with its international counterparts, and remains on the alert for issues that may impact on New Zealand. In cases where there have been incidents overseas, the authority’s relationship with its international counterparts has given it no cause to suspect that the affected foods have been sold in New Zealand.

Sue Kedgley: How can she be confident that the 23,000 tonnes of food imported from China into New Zealand last year were safe, when the Food Safety Authority refuses to conduct even random testing; and why should New Zealanders not be entitled to know whether these imported prawns are from China or from some other part of the world, particularly when they are exactly the same prawns that the Americans have found to be laced with carcinogenic compounds; if her Government refuses to take precautions to assure New Zealanders that they are safe, should we not at least have mandatory country-of-origin labelling, so that we can avoid these products if we so choose?

Hon ANNETTE KING: Since 1963 the Codex Alimentarius Commission set up by the World Health Organization and the Food and Agricultural Organization of the United Nations has developed food standards and codes of practice to protect health worldwide. We follow those standards in New Zealand. We make sure that we do have safe food in this country. The scaremongering from that member—who consistently gets her facts wrong, who consistently says that we bring in a certain tonnage of food from China, only to have to correct her press statements later—is not doing any good in New Zealand. I find that it is more to do with China than it is to do with the foods that are coming in.

Sue Kedgley: I raise a point of order, Madam Speaker. I specifically asked whether people had a right to know whether their prawns came from China or from some other country.

Madam SPEAKER: I thank the member. I think the Minister addressed the question.

Hon Dr Michael Cullen: Does the Minister have any concerns about the safety of dietary supplements imported from China; if so, what are those concerns, and has she received any approaches from Sue Kedgley on those matters?

Hon ANNETTE KING: In respect of the last part of that question, as far as I can remember Sue Kedgley has never made any representations to me on complementary medicines coming in from China. She has not made any representations in terms of whether they are contaminated. I believe that a rather double standard is being applied here, whereby Sue Kedgley would like every piece of food in New Zealand to be tested but does not ask for the same when it comes to dietary supplements.

Sue Kedgley: I seek leave to table a number of documents. The first document is a submission that I made on the Therapeutic Products and Medicines Bill—

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

Sue Kedgley: —that called for stronger regulations for dietary supplements—

Madam SPEAKER: There is objection. I remind the member to just identify the document. You said it was your submission—that identified it. You do not read out what is in the document. The next document, please.

Sue Kedgley: This is a document that shows kids’ snacks laced with hormones—

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

Sue Kedgley: I have another document here from Greenpeace, which found that 70 percent of tomatoes were laced with—

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

Sue Kedgley: I have one here from the Food and Drug Administration, which has found farmed seafood laced with—

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

Sue Kedgley: I have a report here of fake baby-food formulas that cause severe malnutrition—

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

Sue Kedgley: I have a report here showing that 23,000 tonnes of food are imported into New Zealand from China.

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

Sue Kedgley: I have a report here from the World Health Organization that states that unsafe food from China remains a serious threat.

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

Sue Kedgley: I have another one here, which is a report showing that soy sauce was bulked up with arsenic-tainted—

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

Sue Kedgley: I have one final report showing that asthma medication is fed to pigs in China.

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

Hon Mark Gosche: I seek leave to table a transcript of a Sunday programme, which identified Chinese herbal remedies sold in my electorate that contained diuretics and steroids.

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

ENDS

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