Questions And Answers - Thursday 15 May 2006

Questions And Answers - Thursday 15 May 2006

1. Toll Holdings—Rail and Ferry Purchase

[Uncorrected transcript—subject to correction and further editing.]

1. Hon BILL ENGLISH (Deputy Leader—National) to the Minister of Finance: What is the Government’s best estimate of the full and final cost, inclusive of any subsidies, discounts, or loans, of its purchase of Toll NZ’s rail and ferry business?

Hon TREVOR MALLARD (Associate Minister of Finance) on behalf of the Minister of Finance: The best estimate is $665 million. For accounting reasons this will be reflected in an appropriation of $690 million in next week’s Budget.

Hon Bill English: Does he recall his statement that the rail business the Government has purchased “will deliver serious dividends for our economy”, or would he agree now that a more accurate description would be that the serious dividends will not be for our economy but, in fact, have already been delivered to Toll shareholders in Australia in a several hundred million - dollar increase in the value of their company and apparently to shareholders in Namarong Investments Pty Ltd, who must have anticipated what an easy touch Dr Cullen was?

Hon TREVOR MALLARD: Yes, no, and the final matter is, of course, something for the Australian Stock Exchange and the Australian Shareholders’ Association.

Hon Bill English: Can he tell the House which is the most accurate description of his negotiations: his description “Wepaid more than we liked, Toll got less than they’d like—that’s the nature of any agreement”, or the comment in the Australian financial media that “Toll pulled off the con job of the century.”?

Hon TREVOR MALLARD: The former.

Hon Bill English: Will the Minister make a commitment now to the transport industry that it will not allow subsidies for Toll Tranz Link, Toll’s trucking business, that are not available to every other operator?

Hon TREVOR MALLARD: It has already been disclosed that part of this arrangement is access to sheds and other areas close to the track. That is part of the arrangement and part of the reason there is a difference between the $665 million and $690 million.

Darien Fenton: Has the Minister received any reports about support for the Government’s buy-back of the rail system?

Hon TREVOR MALLARD: Yes I have. I have received a report from a commentator claiming that he supported the Government’s purchase of the rail track in 2004 even though at the time he said he opposed it vehemently. I have received a report from the same commentator saying he vehemently opposes the Government’s purchase of Toll New Zealand’s rail and ferry assets, accusing those New Zealanders who would not support it of nostalgia, but promising “We would not sell them off.” But then again, this person has flip-flopped on Iraq, on climate change, on Treaty policy, on the overseas ownership of strategic assets, and on asset sales generally. So it is no real surprise when the report comes from John Key.

Hon Bill English: Will the Minister answer the question he would not answer 2 days ago on whether he will reveal to the public the Government’s best estimate of all the obligations it has taken on in the purchase of Toll; or should we believe much better informed commentators who say: “The Government has underestimated by far the cost it faces in purchasing Toll.”, and who describe Toll as “a pig of a business”?

Hon TREVOR MALLARD: To the first question the member asked, yes.

Hon Bill English: Can the Minister confirm whether he is proud of the innovative outcome he has produced where for the last 20 years New Zealanders have worried that the Government would get ripped off when it sold assets, and he has been able to show in 1 week that the Government gets ripped off when it buys them?

Hon TREVOR MALLARD: As all the evidence comes out, the announcements are made, and the ink is dry on this arrangement, the member will be eating his words.

Rt Hon Winston Peters: Talking about being ripped off, has he received any reports that will act as guidance for the Government in respect of New Zealand Rail, recording the fact that the Booz Allen report stated in 1992 that it was down to make $100 million a year by 1994, but the National Party sold it off to its friends from Fay Richwhite and Wisconsin Central Transportation for $328 million, whereupon they then recapitalised the company, drove the share price down to 28c, and had the taxpayer having to bail it out a second time; does he recall the National Party doing that on 18 June 1993?

Hon TREVOR MALLARD: I cannot confirm the exact date, but I think the general arrangements the member has described are well within public purview.

Hon Jim Anderton: Has the Minister received any reports that when New Zealand Rail was sold by the then National Government it was sold for less than the value of the wooden sleepers?

Hon TREVOR MALLARD: I think there were some sleepers who sold it.

Rt Hon Winston Peters: Has the Minister received any reports that the then Government in 1993 claimed that the taxpayer could not retain this asset, because it did not have the $200 million that was going to be injected into it by its friends Fay Richwhite, who never invested one cent, rather bled the company—

Hon Tau Henare: So what?

Rt Hon Winston Peters: So I tell Tau that we are not going to let his friends run it again, that is what. I am making sure the public know what National is like when it gets hold of State assets, and how good its promises not to sell are; does he recall that happening, and can he reflect upon how good private enterprise’s promise was then about putting infrastructure into railways?

Hon TREVOR MALLARD: Further than that I can report that the taxpayer now faces a bill of about $400 million to bring back the rail assets alone—the track assets, not the rolling stock—up to the sort of standard that is necessary for a half-modern railway.

Hon Pete Hodgson: Can the Minister recall a debate in this House at the time of the purchase of Air New Zealand by the Government on 13 September 2001 when one member of this House said that the Government had “sent the commercial credibility of New Zealand and New Zealanders down the tube.”, and went on to say: “there is no path ahead for Air New Zealand. It is a crippled airline at the bottom of the world,” and can he confirm that the member who said that was the Hon Bill English?

Hon TREVOR MALLARD: That member’s credibility was shot on a number of occasions, especially when he lost count. That member has very, very little credibility in these matters, and his lack of understanding, for example, of the fact that companies carry debt is just an indication of how wasted his time in Treasury was.

Rt Hon Winston Peters: Has the Minister read any reports regarding the sale price of New Zealand Rail jumping $188 million just 24 hours after the National Government sold it to its mates in Fay Richwhite for a lousy—

Hon Dr Nick Smith: You voted for it.

Rt Hon Winston Peters: No, I did not, sunshine. Do not lie. That member was not even a member of the party then. That was that member’s second big mistake.

Hon Bill English: I raise a point of order, Madam Speaker. The member knows he should address all members by their appropriate parliamentary title.

Madam SPEAKER: Yes. Would the members please be seated for a minute.;bviously, if members make interjections they are likely to receive responses, but those responses should be in terms of the Standing Orders, as well, and “sunshine” is not acceptable to call a member. Please refer to the member’s name.

Rt Hon Winston Peters: I raise a point of order, Madam Speaker. When a member screams out “You voted for it.” like that, knowing that it is a demonstrable, palpable effrontery to the truth, what can a member do to react? He knows that it is not true. Either he withdraws and apologises or I will take a privilege case against him for lying to the House.

Madam SPEAKER: That is always for the member, if he wishes to do so, but, as I said, we try to keep within the Standing Orders in our exchanges.

Hon Dr Nick Smith: I seek leave of the House to table the Hansard record showing that in 1993 on the third reading of the bill that sold rail, there was no dissent. The bill was passed unanimously.

 Leave granted.



Rt Hon Winston Peters: I seek leave to table the widespread newspaper evidence that suggests that that very week I was winning the Tauranga by-election, unopposed by National, and had not been sworn back into the House, and therefore could not vote.

 Leave granted.



Rt Hon Winston Peters: Has the Minister read any reports regarding the share price of New Zealand Rail jumping $188 million just 24 hours after the National Government sold it to its mates, Fay and Richwhite, for a lousy $328 million in 1993; and can he confirm that several people involved in that horrendously irresponsible fire sale of our vital infrastructure are recognisable on the benches opposite today?

Hon TREVOR MALLARD: I think it is fair to say that I do not have the detail of the exact share price change in my mind, but it is absolutely clear that it was a fire sale, that the conditions around it were just not good enough for the country—

Hon Dr Nick Smith: Why did Labour vote for it?

Hon TREVOR MALLARD:did not vote for it, and the member should stop making that up, as well—and members opposite, especially Bill English, would love to do it again.

Peter Brown: When will the Minister be in a position to tell the House the name of the new organisation, the governance and management structure, and some specific details around the modus operandi?

Hon TREVOR MALLARD: As the member acting for the Minister of Finance in the House today, I do not have that information with me.

/NR/rdonlyres/3F349B3C-FF7B-405D-ABFC-BDFE8396BDA5/83480/48HansQ_20080515_00000086_.pdfFull transcript of Questions for Oral Answer for Thursday, 15 May 2008 [PDF 189k]

2. Kyoto Protocol—Projected Deficit

[Uncorrected transcript—subject to correction and further editing.]

2. MOANA MACKEY (Labour) to the Minister responsible for Climate Change Issues: What is the revised projected deficit in tonnes and dollars during the first commitment period of the Kyoto Protocol from 2008 to 2012, and how does this compare with the previous figure?

Hon DAVID PARKER (Minister responsible for Climate Change Issues) : The newly revised deficit is 21.7 million tonnes, which equates to a $481 million sum at the current cost of carbon. The previous year’s estimate was 45.5 million tonnes, with a reliability of around $1 billion, so the figure released this week demonstrates that our liability has more than halved, with a saving to the nation of more than $500 million. Without the emissions trading scheme, New Zealand’s emissions would rise substantially in the short term, and by even more in the long term.

Moana Mackey: What is the likely range of deficit for the country in tonnes of emissions and in dollars if the emissions trading scheme does not proceed?

Hon DAVID PARKER: I am advised that if the emissions trading scheme does not proceed, New Zealand’s emissions would rise during the first commitment period, ending 2012, by between 15 and 50 million tonnes, at an additional cost of between $326 million and $909 million at the current cost of carbon. All of that is avoidable and wasteful, and the economic loss to the country would be borne by taxpayers.

Hon Dr Nick Smith: Why should this Parliament and New Zealand trust the Government in respect of New Zealand’s Kyoto Protocol deficit when at the time of the ratification of the Kyoto Protocol the Government told New Zealanders that we were set to make a profit of $1,100 million, when at the time of the 2005 general election the Government accepted that it was a deficit but said that it was $300 million and that there was no conceivable scenario where it could get worse than that, and when on 4 May this year Treasury said that the figure, including the effect of the emissions trading system, was $1,009 million but just 3 days later the Government revised the figure to $482 million; and how could the Government, over a period of 3 days, make a change of $500 million in this estimate?

Hon DAVID PARKER: If I could be given the courtesy of responding to at least a number of the issues that Dr Smith has raised, I say that the first is that New Zealand’s preparation of our estimates is probably the most transparent in the world. The latest net position report, which I am about to table, is a 76-page document, so there is plenty of detail there. It is, of course, no longer just a projection, because it can take into account actual emissions that are starting during the first commitment period, which we are already into. So the range of uncertainty decreases year by year. Lastly, but by no means least, I would point out that the same methodology is used as is audited by the United Nations auditors every year in accordance with the rules under the Kyoto Protocol. So these figures are very robust and are becoming more accurate year by year.

Heather Roy: Is the Minister at all concerned that those on lower wages who are least able to afford increased household costs will be severely disadvantaged by Labour’s Kyoto Protocol obligations as outlined by the New Zealand Institute of Economic Research estimates, and that the emissions trading scheme will result in the loss of 22,000 jobs by 2012, which is a reduction in average full-time wages by $2.30 an hour, and a $3,000 reduction in an average household’s annual spend by 2025?

Hon DAVID PARKER: I would make three points in response to that. The first is that, of course, the Government—and any Government—would be concerned about the effect on households. That is one of the reasons why we have delayed the entry of the transport sector into the system. The second point I would make is that the figures the member refers to need to be put into context in that they are saying that the economy, if it were to grow over a period, would grow by slightly less, but people would still be better off than they are today. The third point I would make—and this issue requires some detail and is addressed in a later question today, so I will not go into it in detail—is that there is a problem in the New Zealand Institute of Economic Research study that we have now got to the bottom of.

Hon Dr Nick Smith: Can the Minister explain why on 4 May, in issuing the pre-Budget fiscal update, the Government stated that the Kyoto Protocol liability was $1,009 million, but just 3 days later the Prime Minister announced that it was, in fact, $482 million; and does this not suggest that these figures are being politically manipulated to suit the agenda of the Government in explaining a backward flip, and that if these figures are to have credibility, then they should be managed independently and released in the same way in which the household labour force survey, inflation, and other critical economic data—

Hon Trevor Mallard: What an attack on Treasury—on their integrity.

Hon Dr Nick Smith: Well, perhaps Mr Mallard might explain how it can be that on 4 May the Government issued—

Hon DAVID PARKER: I raise a point of order, Madam Speaker. We have already heard a speech. I think that it is clear under the Standing Orders that questions are meant to be put to the Minister. I would ask the member to address his question to me, please.

Madam SPEAKER: Thank you. Interjections do have responses. Responses, hopefully, will be short, as the interjection should be. Perhaps we can now return to the question, which was a long one, so that the Minister can remember what its content is.

Hon Dr Nick Smith: How does the Minister explain that on 4 May, in the pre-Budget fiscal update, the Government advised the people of New Zealand that the estimated Kyoto deficit was $1,009 million, but just 3 days later the Prime Minister announced, at the same time as the backward flip on the timing of the emissions trading scheme, that in fact the figure was only $482 million; and does he seriously suggest that the key facts that led to the revision downwards were not known 3 days earlier?

Hon DAVID PARKER: The member already knows the answer to this question, but pretends otherwise. The net position report in terms of tonnes is produced once a year. Every month Treasury updates that figure based on the projected deficit in tonnes to take account of movements like the change in the exchange rate or the change in the international price of carbon. That is what happens monthly, and that is what happened in respect of the figure that was in Treasury’s estimates previously. Once—

Hon Dr Nick Smith: It’s wrong.

Hon DAVID PARKER: No, it is not. Once a year the net position report is recalculated. There is a lot of work in it. It does not happen in 3 days, as the member suggests. Indeed, the summary of it this year is 76 pages long.

Gordon Copeland: How much of that deficit is attributable to the net deforestation of 46,000 hectares of trees that occurred between 2004 and 2007, and should not that amount at least be applied towards new forest planting incentives to create a massive carbon sink right here in New Zealand with benefit to both our environment and our economy, since 2012 is now just 4 years away?

Hon DAVID PARKER: The first part of the question asked how much of the deforestation between a certain period and 2007 was shown in that figure. The answer is zero dollars, because, of course, New Zealand’s Kyoto liabilities did not start until the start of this year, and it is deforestation from that period onwards.

I seek leave to table the net position report for 2008, which is prepared on the same basis as previous years.

 Leave granted.



/NR/rdonlyres/9B4F63C2-9D3F-439D-9C25-092C972690A0/83482/48HansQ_20080515_00000224_.pdfFull transcript of Questions for Oral Answer for Thursday, 15 May 2008 [PDF 189k]

3. Income Tax—Changes

[Uncorrected transcript—subject to correction and further editing.]

3. Hon BILL ENGLISH (Deputy Leader—National) to the Minister of Finance: What changes to statutory personal income tax rates and thresholds has the Government made since 1999?

Hon TREVOR MALLARD (Associate Minister of Finance) on behalf of the Minister of Finance: Since 1999 a new top tax rate has been introduced, and taxes on savers, businesses, and families have been cut by $4.6 billion. This reflects tax cuts for savers of $1,448 million, for businesses of $1,545 million, and for families of $1,622 million. For a family with one earner on the average wage of $48,500 and with two young children, this translates to an effective tax cut of $118 per week, compared with the tax paid by a family on the average wage in 1999. That does not, of course, include support for that family’s savings through KiwiSaver.

Hon Bill English: Can the Minister confirm that, in fact, Labour has made no changes to the statutory personal income tax rates and thresholds, and that its record in Government has been to refuse to reduce taxes when New Zealand could afford it, because it wanted to spend the money; to promise tax cuts before the 2005 election, and then, after Labour was re-elected, to break that promise; and now to make it clear how much it hates having to promise tax cuts, which it has to do for its electoral survival?

Hon TREVOR MALLARD: The member is wrong, right from the beginning of his question. Of course there has been a tax rate change since we have been in Government. We put up the tax rate for the highest income earners right at the beginning.

Hon Mark Gosche: Can the Minister tell the House how the tax paid by an average family changed between the years 2000 and 2007?

Hon TREVOR MALLARD: According to the OECD’s Taxing Wages 2006/2007 report, the tax burden for a one-earner married couple on the average wage and with two children fell from 13.6 percent to 2.8 percent—that was before the extension to Working for Families on 1 July last year. At the same time, that family would have seen cuts in the cost of going to the doctor, which Tony Ryall wants to reverse; prescription costs fall; and saving for retirement made easier.

Hon Bill English: Does the Minister disagree with reports that people in Australia have to earn more than $195,000 a year before they pay more tax, as a proportion of their income, than people in New Zealand do, and that by the time Australia has implemented another 4 years of tax cuts, people in Australia will have to earn $1.6 million before they pay more tax, as a proportion of their income, than people in New Zealand do?

Hon TREVOR MALLARD: No, I cannot confirm that. But I can tell the member that the OECD report shows that the tax wedge for a one-earner married couple on the average wage with two children—that is, income tax plus employee and employer contributions, less cash benefits—as a percentage of labour costs, is 2.8 percent in New Zealand, and in Australia it is 15.1 percent.

Jeanette Fitzsimons: Can the Minister assure the House that if any tax cuts are given in next week’s Budget, they will benefit low-income earners and beneficiaries at least as much as higher-income earners; if not, can he tell us what the hell happened to the Labour Party?

Hon TREVOR MALLARD: I give that member an assurance that the tax cuts will be fair.

Hon Bill English: Can the Minister tell the House why Labour thinks it is more important to spend $600 million on more diplomats, which it announced 2 months ago, rather than spending it in the way that the Greens, who apparently support the Government, want it to spend it—on child poverty—and rather than handing it back to households on the average wage that are hurting because interest rates have doubled under Labour and food and fuel prices are going through the roof?

Hon TREVOR MALLARD: All will be announced next Thursday.

Rt Hon Winston Peters: What further reports has the Minister heard of people making up party policy on the hoof—like we just heard—when it comes to foreign affairs policy in this country; but, more particularly, what reports does he have that suggest that the Government between November 1990 and 1999 followed the Hawke-Keating or Howard-Costello economic prescription with which members opposite make so many comparisons today?

Madam SPEAKER: The second part of the question is within the ministerial responsibility.

Hon TREVOR MALLARD: Yes. It is absolutely obvious that the approach that the National Government took to drive down the wages of New Zealanders, and its approach on the question of savings, were exactly the opposite of those of Australia, and that that is why we are a poorer country now.

Hon Bill English: Can the Minister understand why taxpayers are worried about how he uses their money, when standards of public administration under the Labour Government are so low that Ministers tried to hide unlawful conduct at the top ranks of the Immigration Service for 12 months, and when no sanctions were applied until this matter was made public by the media?

Hon TREVOR MALLARD: That is a very long stretch as far as relevance is concerned.

Madam SPEAKER: It is a long stretch.

/NR/rdonlyres/6013D84B-E6FE-4582-9806-4747CEC3F7A0/83484/48HansQ_20080515_00000301_.pdfFull transcript of Questions for Oral Answer for Thursday, 15 May 2008 [PDF 189k]

4. Disabled People—Participation

[Uncorrected transcript—subject to correction and further editing.]

4. LYNNE PILLAY (Labour—Waitakere) to the Minister for Disability Issues: What reports has she received that recognise progress made in advancing the participation of disabled people across New Zealand society?

Hon RUTH DYSON (Minister for Disability Issues) : Earlier today I was honoured to receive the prestigious Franklin Delano Roosevelt International Disability Award from the Governor-General, on behalf of the Labour-led Government, and on behalf of all New Zealanders who have worked so hard towards the goal of full participation of disabled citizens. I have been told that for the first time in the history of the Roosevelt award there was no debate between committee members about which country should receive it. New Zealand stood out as the clear and unanimous choice. This recognises the extraordinary leadership that New Zealand has shown in this area.

Lynne Pillay: How does the Roosevelt award recognise the role of the non-government sector in working towards an inclusive New Zealand?

Hon RUTH DYSON: Partnership with disabled people has been critical to delivering and implementing the New Zealand Disability Strategy, which has been applauded through the Roosevelt award. I am therefore very pleased to say that part of the award is a US$50,000 grant to be given to an outstanding non-government disability organisation in our winning country. The Disabled Persons Assembly has been awarded this funding in order to promote the United Nations Convention on the Rights of Persons with Disabilities as a major, ongoing event in the lives of New Zealanders. It will also create a diversity action programme, using disabled people as teachers.

/NR/rdonlyres/5137CB80-ACC2-48AA-B517-B949A05DE526/83486/48HansQ_20080515_00000376_.pdfFull transcript of Questions for Oral Answer for Thursday, 15 May 2008 [PDF 189k]

5. Immigration, Minister—Accountability

[Uncorrected transcript—subject to correction and further editing.]

5. Dr the Hon LOCKWOOD SMITH (National—Rodney) to the Minister of Immigration: Is the Minister of Immigration accountable for the outcomes of Government immigration policy?

Hon CLAYTON COSGROVE (Minister of Immigration) : Yes, I am responsible for the outcomes of Government immigration policy, and the chief executive, as the member knows, is responsible for the management of the organisation that implements that policy.

Dr the Hon Lockwood Smith: Is it an acceptable outcome of the Government’s Pacific residual quota policy for residence to be granted to applicants who did not meet the requirements of that Government policy, while residence was not granted to applicants who did meet all the requirements of that policy?

Hon CLAYTON COSGROVE: No, that is not acceptable, and in a case such as that—

Dr the Hon Lockwood Smith: Then why don’t you do something about it?

Hon CLAYTON COSGROVE: Does the member want the answer or not? In a case such as that—[Interruption] They do not want the answer; they have preordained the answer. In a case such as that it is not an acceptable outcome, and indeed the officers of Immigration New Zealand who, in the hypothetical case, executed such an order would need to be dealt with—not dealt with in law by Ministers but dealt with in law by the chief executive, because it is an individual employee matter. The Opposition may not like it, but that is the position under section 33 of the State Sector Act. I invite the member to stand up now and tell us whether he would break the law if he were Minister.

Dr the Hon Lockwood Smith: When the Minister was briefed on the Oughton report in December last year, why did he judge it to be only an employment matter that the applicants under the Government’s Pacific residual quota from Kiribati who should have been granted residence according to Government policy were not, while applicants related to the head of the Immigration Service, who did not meet Government policy, were granted residence?

Hon CLAYTON COSGROVE: I was advised by the chief executive that the Oughton report pertained to matters involving individual employees. Section 33 of the State Sector Act requires the chief executive to act independently on individual employee matters, and explicitly provides that he is “not … responsible to the appropriate Minister”. That is why I did not receive the Oughton report. Nor could I instruct the chief executive to release the report, as the member constantly asked me to do, because that would have been a breach as it related to individual employee matters. However, I note that the member has been very keen—and was at the time—for me to release the report, which was under the control, rightly, of the chief executive, and was encouraging me to breach the law. I will not do that.

Dr the Hon Lockwood Smith: When the Minister was advised in December that the Oughton report had found that it was not unusual for managers in his department to take applications that were in breach of Government policy around the staff until they could find someone who would make an unlawful decision against the required Government policy outcome, why did he judge that to be only an employment matter and no concern of his?

Hon CLAYTON COSGROVE: I will try again. I did not receive the Oughton report. I was not given the Oughton report or its contents, as the member tries to presume I was. I was advised that the report pertained to individual employee matters, and that under law I had no right to demand it for myself, that my predecessor had no right to demand it for himself, and that we had no right to require or demand the chief executive to release it. And, by the way, the chief executive would have rightly declined to do so, as the State Sector Act requires.

Dr the Hon Lockwood Smith: Is it correct that when the Minister was briefed on the Oughton report by his chief executive on 14 December 2007 he judged that “these were employment matters”, yet when the report was made public in April this year he asked the State Services Commissioner to look at both the Thompson issue and the wider issues around it; if so, why did he wait until the matter was under public scrutiny before he took that action on it?

Hon CLAYTON COSGROVE: Let us recount the facts. On 14 December when I was briefed, I was briefed that the State Services Commission had already been engaged by the chief executive. That is the first point. So I could have got the State Services Commissioner in at that time, but the only problem with that was that he already was in at that time. The second point is that the chief executive subsequently briefed me that he had sought legal advice from the Crown Law Office. Now, those members will not like this either, of course, but the chief executive had sought legal advice from the Crown Law Office as to whether, if he had a mind to, he could reopen the matter. That advice said he could not do so unless there was new information. When the Oughton report was then released and I read it, I judged at that point, having read it for the first time, that there were wider issues, and I asked the State Services Commissioner, through the Minister, to widen the inquiries and look at the matters.

Dr the Hon Lockwood Smith: Is the Minister now alleging to this House that his chief executive failed to brief him on the full contents of the Oughton report and the full wider ramifications of it; if so, what will he now do about that?

Hon CLAYTON COSGROVE: That is not what I said, and the member knows it. What I said was—and I will try to use smaller words—that I had no right to receive the report and did not. I was advised that it pertained to individual employee matters. When the report was released, the State Services Commission having been already engaged, I chose to reassure myself around the contents of the report and I asked the State Services Commission to widen its inquiries.

/NR/rdonlyres/7756CFB4-3C9C-43E3-AACF-5F9D97A8E4AE/83488/48HansQ_20080515_00000402_.pdfFull transcript of Questions for Oral Answer for Thursday, 15 May 2008 [PDF 189k]

6. Prescription Subsidies—Funding

[Uncorrected transcript—subject to correction and further editing.]

6. Hon TONY RYALL (National—Bay of Plenty) to the Minister of Health: What are the eligibility criteria for publicly funded prescription subsidies, and how are these monitored and audited?

Hon DAVID CUNLIFFE (Minister of Health) : Eligibility criteria under the New Zealand Public Health and Disability Act 2000 are somewhat complex. One criterion is, of course, that a person have a medical condition that could benefit from treatment. Another criterion is that a person be either a New Zealand citizen or New Zealand resident, or a person applying for refugee status, or a person from a certain country—for example, the UK, Australia, Niue, Tokelau, and the Cook Islands—or a student on a certain type of visa. These criteria apply to all publicly funded health and disability services. If an individual is not eligible for a subsidised prescription, a prescription can still be provided but at an unsubsidised rate. Overall subsidies and subsidy claiming are routinely audited by HealthPAC.

Hon Tony Ryall: Why did the Government do nothing, despite repeated warnings that overseas visitors were getting subsidised medicines and legislation, which is against Government policy, and why did the army of Ministry of Health auditors not pick this up?

Hon DAVID CUNLIFFE: That would depend on whether the member was referring to the current Government or to his own party when in Government, as it appears that these issues have been around for a very long time.

Jill Pettis: Is the Minister aware of any actions that are being taken to minimise the number of ineligible people who are receiving subsidised medication?

Hon DAVID CUNLIFFE: I have asked the Ministry of Health to work with the district health boards and the primary health organisations to ensure that best practice around eligibility is followed by both prescribers and dispensing pharmacists. They are the only people who can ask a patient whether he or she is a resident or is otherwise eligible to receive subsidies in New Zealand. Although some of this work was ongoing, I have now asked the Director-General of Health to set up a special project team to deal with this issue.

Barbara Stewart: Can the Minister give the House an assurance that problems with recording foreign patient details are restricted to the areas of medicines and lab tests; if not, will he act urgently to ensure that foreign patients are not accessing subsidised health care in other areas at the expense of New Zealanders in need?

Hon DAVID CUNLIFFE: I can assure the member that a number of actions have been ongoing. In particular, I can confirm that clear directives have been issued to ensure that hospital treatment is not provided to ineligible non-residents without their status being recorded, and that steps are taken to recover those costs as appropriate.

Hon Tony Ryall: Does the Minister recall that the Government bought a stockpile of publicly funded antibiotics as part of its pandemic plan, and promised that this publicly funded medicine stock would be rotated to avoid expiry; and who is responsible for monitoring it?

Hon DAVID CUNLIFFE: If the member would like the Minister to be briefed on pandemic preparations, I suggest he put it down in the original question.

Hon Tony Ryall: Can the Minister confirm that the Government forgot about the expiry dates on those antibiotics, and that now almost $1 million worth of them have had to be poured down the drain; and is this yet another example of waste and mismanagement by the Labour Government?

Hon DAVID CUNLIFFE: If the member was more popular with his colleagues, he might get more primary questions and therefore could ask that question sensibly.

Hon Tony Ryall: Does the Minister remember signing this document, which is an answer to a written question that confirms that almost $1 million of antibiotics have had to be poured down the drain because they are past their expiry dates; and why were these drugs not made available to New Zealanders, instead of their being subject to waste and mismanagement that has seen $1 million of valuable health money wasted because this Government forgot about the expiry dates?

Hon DAVID CUNLIFFE: In the first place, it is little difficult to read it from here, especially when the member is shaking like a leaf. If the member is suggesting that the Government dispense Tamiflu medicine to people who do not have avian flu, I am glad that he is not my clinician.

Dr Jackie Blue: What will the Minister tell New Zealanders who desperately want new medicines to be funded, when they hear that he has just poured almost $1 million of their pharmaceutical budget down the drain?

Hon DAVID CUNLIFFE: The Opposition is quite clearly having a hard day; it is stretching the boundaries of relevance to the primary question. If Opposition members would like a considered response on pandemic preparations, they should get the support of their whips to put a question on the Order Paper, like any other grown-up in the House does.

Hon Tony Ryall: I raise a point of order, Madam Speaker. Would you confirm that answers to written questions are provided by the Minister who was asked the question, and can you explain how a Minister can say that he knows nothing about the matter despite the fact that he signed out the written answer?

Madam SPEAKER: As the member knows, the Speaker does not give opinions.

Hon Pete Hodgson: Can the Minister confirm that at an earlier time, when this country was preparing for a possible pandemic, a clear decision was taken to have a surge capacity of, especially, injectable antibiotics and Tamiflu brought into the country, in the knowledge that if there was no pandemic they would be wasted; and, furthermore, that the budgetary process for doing so was clear and transparent at the time, and made public; if so, what is new?

Hon DAVID CUNLIFFE: As the member knows, I have a very high regard for the work of my predecessor in this respect.

Hon Tony Ryall: No, you don’t.

Hon DAVID CUNLIFFE: Oh yes, I do, Mr Ryall; oh yes, I do. Further, I venture to suggest that if my predecessor had not made such a wise decision in that case, we would be facing exactly the opposite questions from the Opposition today—especially if, God forbid, anyone had caught avian flu.

Hon Tony Ryall: I seek leave to table the statement made by Dr Moodie that district health board hospitals have agreed to manage rotation of the stock in order to minimise stock expiry.

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

Hon DAVID CUNLIFFE: I raise a point of order, Madam Speaker. Because of the barracking from the member’s colleagues, it was a bit hard to hear him. Did I hear him say that he opposed the idea of minimising wastage by rotation?

Madam SPEAKER: As I have said—[Interruption] Please be seated; I am on my feet. It is not for the Speaker, as I have said, to give opinions or to clarify issues, but the member does raise a point, in that when there is a lot of noise in the House it is very difficult for anyone to hear.

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7. Benefit System—Government Actions

[Uncorrected transcript—subject to correction and further editing.]

7. SUE BRADFORD (Green) to the Minister for Social Development and Employment: What work, if any, is the Government doing within the benefit system to directly address issues identified in the Ministry of Social Development report Pocketsof significant hardshipandpoverty?

Hon RUTH DYSON (Minister for Social Development and Employment) : This Government’s huge investment in the Working for Families package is designed to significantly reduce poverty, and early results show it is delivering to families and is making a difference. Forty-six percent of the 371,000 families receiving support through Working for Families tax credits in the last tax year were beneficiaries who received three of the four main elements of the Working for Families package. Three-quarters of those receiving tax credits had incomes under $50,000. Our Government is committed to supporting New Zealand families and we will continue to identify ways to target that support at those most in need.

Sue Bradford: Does the Minister accept the findings of her own ministry’s report that beneficiaries are worse off now than they were in the wake of the 1991 benefit cuts; if so, will she be pushing to lift core benefit levels, in line with Labour’s public commitment to a fair and just society?

Hon RUTH DYSON: As I am sure the member is aware, the information to which she referred in both her primary and supplementary question was based on 2004 data, which was prior to the introduction and delivery of the Working for Families package. The comparability of benefits to wages is able to be viewed in a number of ways. Of course, during the 1990s, when we saw the minimum wage frozen, except for a one-off increase of 87.5c, and benefits increased in line with the CPI adjustment only, that difference was not as large as it currently is. Wages have increased at a more rapid rate in the last 8 years than benefits have. That is why there is that difference.

Sue Moroney: What reports has the Minister seen regarding the Government’s progress in reducing the number of families living in poverty?

Hon RUTH DYSON: I have seen a report where the Government’s Working for Families package is described by social policy researcher Charles Waldegrave as “the greatest redistribution of wealth—downwards—we’ve had in 30 years.” I have also seen a report from the Child Poverty Action Group that indicated that child poverty in New Zealand is the result of policies implemented by the National Government in the 1990s. The report identified areas of progress made by this Government, including “substantial reductions in poverty, as a result of the Working for Families package”. It also clearly identified areas where there is still work to do to eliminate child poverty.

Judith Collins: Does the Minister recall that this Government promised in 2002 to make the elimination of child poverty a core policy and its top social priority, yet 6 years later 185,000 children have been identified as living in poverty and beneficiary families are worse off now than they were in 1991—could the record of failure get even worse?

Hon RUTH DYSON: It is bitter irony having questions like that, which are suddenly supportive of beneficiaries, from that member and her party. Since Labour has had the privilege of leading this Government the number of New Zealand children living in poverty has been reduced by 130,000. We do not have elimination of child poverty, but a reduction of the number of children living in poverty by 130,000 is something we should be proud of, and we should be resolved to continue to reduce that number because having children living in poverty in our country is not acceptable.

Taito Phillip Field: Given the recognition of the problems of the cuts to benefits in the “mother of all Budgets” and the poverty generated by that, and, also, the position of New Zealand at fourth bottom out of 25 rich countries in relation to child poverty, what is this Government doing to look at reinstating the equivalent of benefit levels prior to 1990?

Hon RUTH DYSON: The total package of Government support provided for our poorest families includes not only income support but also help to reduce essential costs such as doctors’ fees, prescription charges, and childcare, and also individually tailored intervention to help families meet their needs. I know, as that member is well aware, that those particular supports in relation to access to doctors and childcare have been particularly advantageous for Pasifika families. We have also ensured that the incomes for beneficiary families have kept pace with inflation. In regard to the OECD figures that the member referred to, he will be pleased to know that, with the reduction in child poverty as a result of our increased employment and also the Working for Families package, it is estimated that we will have moved New Zealand’s position from the bottom quarter of the OECD to the top half in relation to child poverty.

Dr Pita Sharples: Why is it, as reported on page 4 of Pockets of significant hardship and poverty, that being Māori or Pasifika “increased the likelihood of experiencing severe or significant poverty and hardship.”?

Hon RUTH DYSON: It is true that for many years in our country those in the lowest socio-economic level have also been Māori and Pasifika. I do not accept that race determines socio-economic status, at all, but it is clear that there is a link between poverty and Māori families. That is why we have put a particular focus not just on the specific areas of delivery of income support but also on the methods of delivery, because we know that access to social service, which was widely available, was not accessed by Māori and Pasifika unless it was delivered by Māori and Pacific groups.

Sue Bradford: Does the Minister accept that basing the annual increase in benefit levels on the CPI is a totally inadequate way of doing it, especially now at this time of steeply increasing fuel, food, transport, and other costs, and will the Government take urgent measures to reduce the gap between wages and benefit levels by, for example, linking benefit rates to a fixed percentage of the average wage, which is just what happens already for superannuitants; should not our beneficiaries be treated with the same equity and decency as our older generation?

Hon RUTH DYSON: I agree with the primary point of the member’s question and that is that a number of our low-income families, particularly people on benefits, are feeling financial stress at the moment and our Government is committed to continue to look at ways of addressing that. I do not believe that a blunt measure such as linking benefits to wages would necessarily address the issue the member is raising, because if we had a National-led Government, we would end up with the same situation we had in the 1990s when wages were suppressed and benefits, having been cut, were then adjusted only in line with the CPI.

Dr Pita Sharples: In light of the Minister’s answer to me, what are the systemic barriers that increase the likelihood of experiencing severe or significant poverty and hardship?

Hon RUTH DYSON: I might repeat the points I made in the answer to my primary question, but the member is aware of them so I will not insult him by doing that. But I can say that one of the areas of which I am most proud is that this Government, at particular political risk, has ensured that all our interventions, and the outcomes, are publicly measured and therefore accountable through the Social Report. That was an initiative that our Government took so that we now have nearly a decade of reporting of the interventions that Government has invested taxpayers’ funds in delivering and of the outcomes that have been achieved. We can see the results that we have made through these interventions and we can better focus on the areas in which we need to do more work.

Sue Bradford: Will the Minister give urgent consideration to restoring a discretion that was lost to the benefit system when the special benefit was abolished, especially in light of the findings of this report; if not, why not?

Hon RUTH DYSON: I will not make a commitment to any particular intervention but I will make a commitment to ensuring that continued work is delivered to address the financial needs of those in most hardship.

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8. Immigration Service—Mary Anne Thompson

[Uncorrected transcript—subject to correction and further editing.]

8. Dr the Hon LOCKWOOD SMITH (National—Rodney) to the Minister of Immigration: What were the terms of reference of the Oughton inquiry into Mary Anne Thompson's involvement in family members from Kiribati wrongly getting residency in New Zealand?

Hon CLAYTON COSGROVE (Minister of Immigration) : I am advised that, in summary, the terms of reference cover the following: first, whether a residence decision was made within authority; second, who was responsible for that decision; third, compliance with Government residence policy in any irregularities; and, four, to highlight processes surrounding this decision, for the attention of the chief executive.

Dr the Hon Lockwood Smith: Given those terms of reference, why does the Minister allege that that inquiry was merely a matter relating to the employment of a staff member, when the actual final report of the inquiry was Review of Apparently Unlawful Immigration Decision?

Hon CLAYTON COSGROVE: The matter, as the member states, was in relation to an unlawful immigration decision actioned by an individual or individuals. That, of course—

Hon Dr Nick Smith: When would they not be?

Hon CLAYTON COSGROVE: That is a very good point. That being the case, it is an employment matter for the chief executive, relating to individual employees.

Dr the Hon Lockwood Smith: When the Minister of Immigration at the time was first briefed on the Oughton inquiry in April 2007, what action does the record show that that Minister took in response to a review of apparently unlawful immigration decision-making in his department?

Hon CLAYTON COSGROVE: That Minister acted lawfully and by the book, as did this Minister.

Hon Dr Nick Smith: What did he do?

Hon CLAYTON COSGROVE: Well, if the member pipes down I will tell him.

Hon Dr Nick Smith: Did they cover it up?

Hon CLAYTON COSGROVE: Well, those members preordain the answer to the question, which speaks volumes about them. The advice that that Minister received was the same advice that I received—that matters related to individual employees are employee matters. He was advised of that. He noted that it was a matter for the chief executive, because there is no employment relationship between Ministers and departments, and that is where it stands. He acted by the book. And I say this: if my predecessor or I had intervened unlawfully against section 33, I bet members $100 that that member would be asking a different series of questions about why Ministers had overreached their authority and breached the law. They cannot have it both ways, and the member knows it.

Dr the Hon Lockwood Smith: Is this Minister telling the House that the then Minister of Immigration, David Cunliffe, knew about the inquiry by David Oughton into unlawful decision-making in his department in April last year, yet never asked for or received a copy of the completed inquiry report, nor asked for a full briefing on that final report? Is that what he is telling the House—that David Cunliffe never asked for a full briefing on that final report?

Hon CLAYTON COSGROVE: No. I admire the member’s ability to twist words. What I am saying is that in April the Minister was briefed, and, latterly, in respect of the report, the Minister, like me, had no right to demand, and was precluded from demanding, a copy of that report or the contents—

Hon Bill English: That’s rubbish.

Hon CLAYTON COSGROVE: —no, it is not, and I invite the member to go and see the State Services Commissioner about it—and had that Minister not played it down the line by the book, as I have done, he would be in breach of the law and that member would be asking why he had breached those laws.

Taito Phillip Field: Is the Minister aware of other illegal immigration decisions relating to movements of people from the Pacific, in particular, involving one Thai restaurateur given a 2-year business visa when, in fact, he had no business and no money; is he aware of that decision?

Madam SPEAKER: The Minister should remember the restrictions about matters before the court.

Hon CLAYTON COSGROVE: Oh, absolutely; I observe that completely. The member does not provide enough information in his question for me to make a judgment on that. The answer is no. I would also say that if the member, like Dr Smith and others, has further information about particular cases, he has a number of courses of action open to him. The chief executive, on 17 April, embarked upon a robust, open review of the Pacific branch. I am assured by the new chief executive that that review will deal with any and all issues in the public arena, or any and all issues that members or other members of the public bring to his attention. Secondly, the member has the option of delivering any evidence he has to the State Services Commission, which itself is investigating wide-ranging matters, and which by 14 December, when I was briefed, was involved because the chief executive had invited it to be involved. Thirdly, there is now a police inquiry into other matters, and it would be inappropriate for me to comment. The member can exercise that option if he so wishes.

Dr the Hon Lockwood Smith: What changed between the time when David Cunliffe, the then Minister of Immigration, was briefed, as he now alleges, on completion of the Oughton inquiry in July of last year, and when he himself was fully briefed in December last year on the Oughton report—what changed between then and April this year, when the Oughton report was exposed to public scrutiny, other than the fact that the cover-up was over?

Hon CLAYTON COSGROVE: In order to assist the member, I tell him that the previous Minister was not briefed in December. I was the Minister at that time.

Dr the Hon Lockwood Smith: I said you.

Hon CLAYTON COSGROVE: No, the member said “the Minister at the time”, and “the previous Minister”.

Hon Dr Nick Smith: You’re wrong.

Hon CLAYTON COSGROVE: I think we may need stretcher-bearers for one particular member. This is a serious issue, and should be dealt with in a serious way. We may need stretcher-bearers for the other Dr Smith. Can I say—

Hon Dr Nick Smith: I raise a point of order, Madam Speaker.

Madam SPEAKER: There is a point of order; it will be heard in silence.

Hon Dr Nick Smith: The Minister, in reciting my colleague Dr the Hon Lockwood Smith’s question, was mistaken in his restating of the course of events. In response to an interjection from me saying that he was wrong, I was then subjected to personal abuse. I think it would be helpful if Dr Smith re-asked his question—in which his dating and timing were correct—because it seems that the Minister was confused about the question that my colleague Dr Smith was asking.

Hon David Parker: I, as well as Minister Clayton Cosgrove, listened carefully to the question, and I am clear that the question that was asked included the imputation that the Minister was the prior Minister, not the current Minister, and that is the point to which Mr Cosgrove was responding.

Madam SPEAKER: I thank members for their interventions. I think if members would keep the noise down, it would be easier to hear. As I have said, interjections do occasion responses. Would the Minister please just respond to the question as succinctly as possible.

Dr the Hon Lockwood Smith: I raise a point of order, Madam Speaker. It would appear that confusion has arisen around my question. It was very clear. I would be very happy to repeat it to avoid that confusion.

Madam SPEAKER: No, I think we should take it in the order it was. I am happy to look at the Hansard. I heard it also in the way that, I am afraid, others did. The member, obviously, feels that he did ask another question. As I said, I am happy to go and look at it later. Could we have a succinct answer to the question, and there is always an opportunity to ask another question—there are still supplementary questions available.

Hon Annette King: I raise a point of order, Madam Speaker. We are on question No. 8 and we have had Dr Nick Smith running interference on every question across the House. He is not asking questions; he is just interjecting and yelling out personal comments. I think we have just about had enough today, and I ask you to require him not to continue going on in that fashion.

Madam SPEAKER: Well, I think that today comments have been made from all sides of the House. Obviously, it does create disorder, and it has. Members have noted the comments that have been made from all sides of the House on this matter. Could I please ask the Minister to succinctly address the question, and then we will ask Dr Smith to ask the question again. Thank you.

Hon CLAYTON COSGROVE: The previous Minister, like me, was not given the content of the Oughton report. That is a fact that pertains to both of us. Prior to the Oughton report becoming public, the State Services Commission and legal advice were both engaged. Both Ministers were advised that these were employee matters. The Oughton report then was released, and I took the view at that point that there were wider issues, especially the one of public confidence. I wished to assure myself of matters pertaining to that, so I asked the State Services Commission to widen its inquiry.

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8. Energy-efficient Retrofit Programme—Announcements

[Uncorrected transcript—subject to correction and further editing.]

8. LESLEY SOPER (Labour) to the Minister of Housing: What recent announcements have been made regarding the energy-efficient retrofit programme?

Hon MARYAN STREET (Minister of Housing) : In response to a Green Party Budget initiative, it was today announced that the energy-efficient retrofit programme will be boosted by $53.4 million in Budget 2008, effectively doubling the pace of the programme. The remaining 21,000 eligible State houses will now be insulated within 5 years, bringing timely relief to households that are squeezed by rising fuel and energy costs. I wish to offer my congratulations to Jeanette Fitzsimons and the Green Party on their development of this initiative.

Lesley Soper: What other initiatives does the Labour-led Government have in place to improve the health and well-being of State house tenants?

Hon MARYAN STREET: One highly successful initiative, the Healthy Housing programme, has helped 6,000 households to date, by providing housing modifications and improving tenants’ access to health and social services. That has seen a 37 percent reduction in potentially avoidable hospitalisations, not only generating significant savings for the health sector but benefiting families, obviously, through better health.

Jeanette Fitzsimons: What effect does the Minister expect this initiative to have on the 50 percent of State house tenants who are children?

Hon MARYAN STREET: I think it would be best if I were to tell the House what I have in mind at the moment, which is a little boy who lives in Huntly, whom I met some time ago. Prior to the retrofitting of the house of this boy’s family, he was regularly admitted to hospital in the grip of terrifying asthma attacks. When I met this child after the house was retrofitted, he was bouncing around like any healthy little boy whom we would expect to be bouncing around. That is the best description that I can give of the effects of this programme.

Jeanette Fitzsimons: Does the Minister agree with the Green Party that in these days of rising power prices we need to look after the most vulnerable people in society, and that after the completion of this initiative we should investigate standards for private sector rental housing, as signalled in the New Zealand Energy Efficiency and Conservation Strategy?

Hon MARYAN STREET: I absolutely agree that we always need to look after the most vulnerable people in our society, and I note further that the State needs to get its own houses in order before it points the finger at private landlords. But I also note that this is a work stream in the New Zealand Energy Efficiency and Conservation Strategy, which is addressing this issue currently.

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10. Emissions Trading Scheme—Economic Effects

[Uncorrected transcript—subject to correction and further editing.]

10. Hon Dr NICK SMITH (National—Nelson) to the Minister responsible for Climate Change Issues: What is his response to this week’s WallStreetJournal editorial “Kiwi Climatology”, which refers to estimates by the New Zealand Institute of Economic Research that the emissions trading scheme will result in a $4.6 billion annual loss in GDP, or a $3,000 cut in household annual spending by 2012, and that the Government disputes this conclusion because it assumes “… New Zealanders will be willing to take lower wages.”?

Hon DAVID PARKER (Minister responsible for Climate Change Issues) : My response is, firstly, that the writer in the Wall Street Journal has not even managed to quote the New Zealand Institute of Economic Research report correctly—

Hon Dr Nick Smith: Oh, it’s the Wall Street Journal that’s wrong.

Hon DAVID PARKER: —it is on this occasion—as the figures quoted for 2012 are clearly supposed to be for 2025, so I suspect that he or she had not even read the New Zealand Institute of Economic Research report. But, more important, I would note that this is the first time that the New Zealand Institute of Economic Research model has been used in New Zealand, and it is increasingly clear that there are problems with it. I have been advised, and the New Zealand Institute of Economic Research now confirms, that the model predicts as a general proposition that if subsidies were provided to agriculture, then New Zealand’s overall GDP would increase. This flies in the face of general economic theory internationally and in the face of New Zealand’s economic history and settled economic theory for New Zealand, but it probably explains why the New Zealand Institute of Economic Research model came up with a answer that was not only counter-intuitive but also diametrically opposed to the modelling done by and for Treasury using models that had been tried and tested in New Zealand for many years.

Hon Dr Nick Smith: Thank you, Madam Speaker—

Hon Members: That’s you, Nick.

Hon Dr Nick Smith: It is normal practice to take a question from the member opposite; that is why I was mistaken. Does—[Interruption] I am sorry, Trevor?

Madam SPEAKER: Would the member please ask the question. It is his turn. He asks the first supplementary question.

Hon Dr Nick Smith: I notice that they all complain about my interjections, but they interject on me continuously.

Madam SPEAKER: Would the member just ask his question.

Hon Dr Nick Smith: Do Labour’s affiliated unions share his view that the reason the New Zealand Institute of Economic Research analysis of the employment and GDP projections is wrong is because “… New Zealanders will be willing to take lower wages.”?

Hon DAVID PARKER: I do not know where that quote comes from, but I certainly do not agree with it.

Hon Bill English: Why did you say it?

Hon DAVID PARKER: I did not. It is not a quote from me. Dr Smith has not even said that it was from me, I tell Mr English, so the member should listen. Further, the New Zealand Institute of Economic Research model did come up with a conclusion that was counter-intuitive, and everyone was scratching their heads as to why. It is actually pretty clear now that there is a fundamental flaw in it.

Su’a William Sio: What has the Parliamentary Commissioner for the Environment said about the Government’s emissions trading scheme?

Hon DAVID PARKER: The Parliamentary Commissioner for the Environment—whom the member opposite, Dr Nick Smith, has himself extensively quoted on other matters recently—has said: “The Emissions Trading Scheme must proceed, as it is an essential system for New Zealand to adjust to a carbon-constrained future and live up to our clean, green image,”.

Hon Dr Nick Smith: Is the fundamental problem here not that the Government wants the international accolades for its carbon-neutral, world-leading climate change policies when it is not prepared to be honest with New Zealand households and businesses as to how much they will pay for New Zealand to be world leading?

Hon DAVID PARKER: No, it is not true, at all, even if the member does not understand the fundamental flaw in the New Zealand Institute of Economic Research study, which has now been exposed as being the assumption that subsidies increase overall net welfare for our country. That is not just in respect of carbon policy but generally in respect of all economic policy. It is a point that I am sure Mr English well understands. That is the problem in the study.

Hon Dr Nick Smith: Does the Minister stand by his statement about the Government’s emissions trading scheme quoted on national radio: “The effect on the economy is minuscule.”, and does he really think that New Zealanders believe that we can be world leaders on carbon neutrality and on climate change with the effect on the economy being “minuscule”?

Hon DAVID PARKER: Yes. I think that any adverse effect on the New Zealand economy would be minuscule and I think that is abundantly clear. Indeed, most of the commentators now get the point—Dr Smith clearly does not—that the emissions trading scheme does not create any cost for the economy. It minimises the cost of New Zealand meeting its obligations under the Kyoto Protocol.

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11. Health Services—Kapiti Coast and Porirua

[Uncorrected transcript—subject to correction and further editing.]

11. BARBARA STEWART (NZ First) to the Minister of Health: Has he been informed that more than 200 people per day travel from Kapiti District to Wellington Hospital for treatment, passing Kenepuru Hospital on the way, and will he instruct the new chief executive of Capital and Coast District Health Board to undertake immediate long-term consideration of how to meet Kapiti coast and Porirua districts’ health needs?

Hon DAVID CUNLIFFE (Minister of Health) : Wellington Hospital provides specialist tertiary and secondary services for the Capital and Coast District Health Board catchment area and tertiary services for nearly a million people in central New Zealand. It has scarce clinical expertise, and sophisticated diagnostic and other clinical equipment that cannot be duplicated across every community facility. That means inevitably that some people will have to travel to receive services, and that is why it assists its constituents by providing free transport services to its Wellington facilities.

Barbara Stewart: Is the Minister aware that the Kapiti area is one of the fastest growing in New Zealand and a major retirement district, and does health planning include making retired people drive long distances for hospital health care?

Hon DAVID CUNLIFFE: Today’s bench mateconstantly reminds me of the attractiveness of the area, so I am aware of the issue. I am advised that to meet increased demand the district health board has increased the number of out-patient services provided in the Kapiti Health Centre from 6,000 to 8,000 a year over the past 2 years. The district health board also aims to provide as many out-patient services as possible close to where people live in the Kapiti and Kenepuru areas, as well as providing free bus services from Kenepuru to Wellington Hospital.

Barbara Stewart: Does the Minister feel that the Government has an obligation to ensure that people who have paid taxes all of their lives are not marginalised in their retirement because health facilities are reduced and centralised?

Hon DAVID CUNLIFFE: Yes, the member makes a good point. The Government takes seriously its obligations to maintain service provision and ensures district health boards meet this obligation by agreeing to maintain services through their district annual plans. These are formal accountability documents between district health boards and the Minister. The district health boards are facilitated to provide those services, in the face of cost and population pressures, through the annual funding adjustments.

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12. Families Commission—Confidence

[Uncorrected transcript—subject to correction and further editing.]

12. JUDITH COLLINS (National—Clevedon) to the Minister for Social Development and Employment: Is she confident that the Families Commission provides a voice for New Zealand families; if so, why?

Hon RUTH DYSON (Minister for Social Development and Employment) : Yes; the Families Commission has consulted widely to ensure that it is identifying issues that are of concern to New Zealand families and has represented those issues strongly. It has provided contributions on matters such as the prevention of family violence, after-school childcare, paid parental leave, and caring for children after parental separation. Those issues are important to New Zealand families.

Judith Collins: Does she think that the Families Commission should spend less time on vanity events, like its planned summit that will “raise the commission’s profile and provide a mandate for its ongoing work”, and more time on addressing the serious issues facing New Zealand families, like child poverty; if not, why not?

Hon RUTH DYSON: The main function set out in statute is for the Families Commission to act as an advocate for the interests of families generally. The commission has taken that statutory responsibility seriously, and is ensuring that as part of that function it is connected with New Zealand families and is able to represent their views properly. I do not know why the Families Commission would want to duplicate the work of the Children’s Commissioner, but if that is what the member has in store for it I am sure the commission would find that very interesting.

Judith Collins: How much time does the Families Commission spend on analysing its own profile, as detailed in the recent communications review by a public relations firm, and how exactly does that help the 185,000 children who were recently identified as living in poverty and the beneficiary families that the Minister recently admitted are worse off now than they were in 1991?

Hon RUTH DYSON: Can I firstly address my comments in response to the end point that the member made, and say that I have never said what the member just referred to. I know that beneficiaries and their families are better off under a Labour-led Government and always will be. The member should not misrepresent either my words or the truth. The decade of the 1990s was the hardest for beneficiary families in New Zealand, and I hope that we and they never have the ill fortune to have that member’s party leading our country again.

Judith Collins: How exactly does it help the 185,000 children who are living in poverty, and the beneficiary families that this Minister did admit, as shown in the Sunday Star-Times, are worse off now than they were in 1991, to have the Families Commission spend time and money on analysing its own profile?

Hon RUTH DYSON: I repeat, I have never said, and nor is it true, what the member has just referred to. Beneficiary families are better off under a Labour-led Government than they have been in the past and will ever be in the future under a National-led Government. That is a fact, and the member knows it. I have heard her welfare policies, and that certainly reinforces both the fact and the perception that beneficiaries are better off under a Labour-led Government. In my view, leadership in areas such as the prevention of family violence, looking at the needs of New Zealand families in regard to after-school childcare, looking at paid parental leave and its extension—which that member and her party voted against when it was introduced in New Zealand—and an increasing issue of how we should care for New Zealand children after their parents have separated are issues of concern, and clear and strong leadership on them are demonstrated by the Families Commission.

Judith Collins: I seek the leave of the House to table an article written by senior journalist Ruth Laugesen of the Sunday Star-Times where the Minister is quoted as confirming that beneficiary families are worse off now than they were in 1991.

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

ENDS