(uncorrected transcript—subject to correction and further editing)

TUESDAY, 29 JUNE 2010

QUESTIONS FOR ORAL ANSWER

QUESTIONS TO MINISTERS

Pacific Economic Development Agency—Contestability of Grant

Hon PHIL GOFF (Leader of the Opposition): My question is to the Minister of Finance: does he stand by his statement to Morning Report on 18 June, when he said the $4.8 million appropriated—[Interruption] Yes, he is quite funny to look at, but let us focus on the question, Mr English. Can I start again, Mr Speaker? There has been an unusual interchange on the other bench; members are a little unsettled.

Mr SPEAKER: I will invite the honourable Leader of the Opposition to start again.

1. Hon PHIL GOFF (Leader of the Opposition) to the Minister of Finance: Does he stand by his statement to Morning Report on 18 June, when he said the $4.8 million appropriated to the Pacific Economic Development Agency would be contestable?

Hon BILL ENGLISH (Minister of Finance): Yes. What I said was that the money will be contestable if the purchase agreement cannot be reached satisfactorily. I expect officials will look at the same issues with regard to this contract as they would with any other—that is, the capacity to deliver, the ability to collaborate, accountability, and how to measure outcomes.

Hon Phil Goff: Why did he claim that the appropriation would be contestable, when the leaked memo of 25 March 2010 from the Ministry of Pacific Island Affairs states explicitly that the Minister of Finance had made it clear that the Pacific Economic Development Agency was to be the preferred provider for the delivery of these initiatives?

Hon BILL ENGLISH: As the member will be aware from his time as a Minister, there is an appropriation process, and then there is a contracting process. The contracting process will focus on achieving what the Government wants to achieve out of this, and that is jobs and skills for young Pacific Islanders. The member may not be aware that they are the group most affected by the recession, and we need to take positive initiatives to keep them connected to the workplace.

Hon Phil Goff: I raise a point of order, Mr Speaker. You will recall that the question was about why he said it was contestable, when the memo stated that this organisation was to be the preferred provider, which is a contradiction of what the Minister had claimed. The Minister gave a long discourse about what he was doing, but he did not answer the question.

Mr SPEAKER: With respect—[Interruption] Hold on a moment. With respect, I think the Minister said a normal appropriation process was involved here. Members can question him further on that—whether they accept that is a reasonable answer or not. But I think it is an answer to the question that was asked.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. How could saying this was a normal process be an answer to an either/or question?

Mr SPEAKER: The member is asking a further question. The person to direct questions to is the Minister. That is exactly what supplementary questions are all about. Members have every right

not to be satisfied with an answer that is given, and if they are not satisfied with the answer, they can question the Minister more about it and pin him down.

Hon Phil Goff: Why did the Minister of Finance ignore the advice of the Ministry of Pacific Island Affairs that the projects promoted by the Pacific Economic Development Agency “overlap with many programmes that are currently being run by the Pacific Business Trust and other local and central government programmes”?

Hon BILL ENGLISH: The advice was not ignored. The Government always takes some notice of officials’ advice. This was a unique proposition, and it is focused on achieving something that I think even the member would like to achieve, and that is to help to lift the skills of young Pacific Islanders and keep them connected to the world of work, so that as the economy recovers they can get jobs.

Hon Phil Goff: Why did the Minister of Finance decide to appropriate the money to the Pacific Economic Development Agency, notwithstanding that the Ministry of Pacific Island Affairs drew his attention to the fact that this was not an agency that had delivered on any projects of note, that this was an agency that had no track record—this was an agency that was untested and unproven— that the experience of the ministry was that local and central government agencies had found that Pacific Economic Development Agency did not work well with other groups, and that the advice from the ministry to him was that this contradicted Government procedures for tendering processes?

Hon BILL ENGLISH: Officials are often cautious, and that is their job. But as the Minister knows, the appropriation did not create any obligation to pay any money to anybody, and that is why right now officials are going through a process to ensure that young Pacific Islanders will get the benefit of an investment of Government money in developing further skills and better opportunities to get jobs. In the end, I think the member will find that both the Pacific Island community and even the Labour Party will come round to supporting doing something active for those young New Zealanders.

Katrina Shanks: Why did the Government make an appropriation in Budget 2010 to help young Pacific people?

Hon BILL ENGLISH: Unemployment is 14.4 percent among Pacific people, and it is even higher among young Pacific people. The Government simply has to take some positive initiatives to ensure that we do not end up with one in five young Pacific Islanders being disconnected from the workforce and having no skills. That would be a bad legacy from the recession.

Hon Phil Goff: How does the Minister justify his claim to the House on 23 June that the Pacific Economic Development Agency agreement would “meet all the requirements of accountability and transparency”, when the process of deciding that it would get the money was anything but transparent, and when the only legal requirement in the Budget is of self-reporting, rather than the more usual, and certainly the more stringent, reporting requirement set out under section 32A of the Public Finance Act?

Hon BILL ENGLISH: I think that the member has asked that question about three times, and he is—

Hon Members: Still hasn’t got an answer.

Hon BILL ENGLISH: The member is trying to describe a contract that has not yet been negotiated or completed. The contract with this organisation, or with any other organisation, will go through exactly the same process as for every other public contract. I might say that at the end of it, we will be very pleased to see arrangements that will help young Pacific Islanders get skills and get jobs. I am surprised that the Labour Party is so opposed to that.

Hon Phil Goff: Was Inga Tuigamala, an aspirant National candidate, at any point involved in discussions with him or Mr Key in relation to the Pacific Economic Development Agency proposal?

Hon BILL ENGLISH: No.

Hon Phil Goff: Was the reason that the Pacific Economic Development Agency was granted the appropriation—against all officials’ advice and in a totally non-transparent manner—that it was

mired by party political considerations, rather than being motivated by how to best and most effectively deliver the services needed by the Pasifika community?

Hon BILL ENGLISH: No, and it does not matter how often the Labour Party says that, because it simply is not true. It was motivated by the need to stop doing what Labour did for years, which was to talk endlessly, write strategies, and hold workshops, and to turn the aspirations of the wider Pacific community into some real change for some real young people with real needs.

Budgets, International—Implications for New Zealand

2. CRAIG FOSS (National—Tukituki) to the Minister of Finance: What reports has he received of recent Budget measures taken internationally, and what implications do they have for New Zealand?

Hon BILL ENGLISH (Minister of Finance): Governments around the world are trying to deal with ballooning debt and deficits, and that means some difficult choices. For instance, in last week’s UK Budget, the British Government was dealing with a deficit of 11 percent of GDP. It had an emergency Budget that included a 25 percent reduction in all departmental spending other than health and overseas aid, a freezing of wages for State sector employees, and an increase in GST with no offsetting change in income tax. That shows the kind of predicament that a country can get into if it does not pay attention to managing its Budget.

Craig Foss: What were the circumstances that forced the new British Government to take such drastic measures?

Hon BILL ENGLISH: The incoming British Government has referred to an unbalanced economy, where that imbalance was caused by a decade of rampant Government spending, and growth in all the wrong places. It talks about “a new model of economic growth [needing to be] built on saving, investment and enterprise instead of debt”. That sounds very familiar. In New Zealand, we are taking a more measured approach. We have curbed increases in Government spending, and have reprioritised almost $4 billion of public spending in order to target our limited resources to the most vulnerable and to front-line public services.

Hon David Cunliffe: Will the Minister listen to his own warning that cutting too much, too quickly can push a country into fresh recession, leading to more unemployment, and more families struggling to make ends meet; and does he now regret the advice he gave to the previous Labour Government to give unaffordable tax cuts and build up debt in advance of a recession?

Hon BILL ENGLISH: I have listened to my own advice, and I often do, because it is consistently good. The Government has also listened to some of that advice, and that is why New Zealand is taking a measured approach to fiscal constraint. We have set a horizon of 3 to 5 years over which Government departments need to manage within the money they have. We expect them to deliver more for less.

Craig Foss: What lessons can New Zealand take from the British experience?

Hon BILL ENGLISH: I think the lesson we can take is that Governments should be consistently careful about the use of taxpayers’ money, and they should make measured and consistent change over time. If we do not make firm decisions consistently, then we will end up making very harsh decisions as the UK Government has now been forced to do. That is why in Budget 2010 we delivered a package of changes that amount to measured control of Government spending, as well as growth-promoting measures that will assist to close the Government deficit.

Hon David Cunliffe: Has the Minister seen reports of falling business confidence in New Zealand, and does he attribute that to European Budget contraction or is it more likely a verdict on his own Budget, which over 7 years musters less than 1 percent extra growth and only 5.7 percent of the extra jobs on the cycle?

Hon BILL ENGLISH: I think some fluctuations in business confidence are not unexpected. The fact is that the recovery is a bit patchy. Some sectors are doing well; some are not doing so well. The good news is that New Zealanders are not racing back to the housing market. They are being

careful with their spending; they are not borrowing a lot more money in a hurry; and, at the same time, the export sector is reflecting the benefits of higher prices and higher productivity. That is exactly the rebalancing we need in this economy. We need more growth in our ability to earn from the rest of the world, and less reliance on debt domestically.

Craig Foss: Is he aware of any policy options that would make a painful British-style correction necessary?

Hon BILL ENGLISH: Yes, there are policy options that would store up trouble for New Zealand—for instance, increasing Government spending rapidly in response to every single group that wanted a bit more money, borrowing a lot more money in global markets, and a reckless increase in Wellington-based bureaucrats that does not enhance front-line services. If we followed those policies, which are the policies of the Opposition, we would end up in the same situation as the UK.

Health Services—Minister’s Statements

3. Hon RUTH DYSON (Labour—Port Hills) to the Minister of Health: Does he stand by all his recent statements on health services?

Hon TONY RYALL (Minister of Health): Yes, including the statement that just before the general election, the Labour Government over 5 years cut over $110 million from public health services, primary care, funding for people with disabling chronic medical conditions, the “Get Checked” Diabetes Aotearoa programme, smoking cessation programmes, and others. It appears the previous Government made those changes because, despite giving district health boards more resources, the growth in health service demand means that district health boards constantly need to move lower priority spending to help deliver improved front-line health services.

Hon Ruth Dyson: Given the increasing number of general practitioners leaving the country under his watch, and the fact that he has recently changed his mind about closing the wage gap with Australian doctors, can New Zealanders expect to wait longer and longer to see a general practitioner under a National Government and pay more for the privilege?

Hon TONY RYALL: No Government has made more efforts than this Government to keep doctors in New Zealand. Not only are we funding additional general practitioner training places but also the tax cuts announced by the Minister of Finance will put substantial money in the pockets of some of our hardest-working health staff.

Hon Ruth Dyson: What does he say to Grey Power, which yesterday raised concerns about Meals on Wheels being cut in the Helensville electorate, and is so distressed about this that it has written both to him and to the Prime Minister?

Hon TONY RYALL: I have looked into that case, and I can say that eight people in Helensville are receiving Meals on Wheels from a local charitable trust that is part-funded by the district health board. Everyone else in the area gets home support and meals through the district health board’s mainstream support services. The district health board is rolling this small contract for those eight people into the contract it provides for the rest of the region. I am advised that those people will get the same, if not improved, service.

Dr Paul Hutchison: What reports has he seen in relation to improving front-line services in areas that are difficult to staff?

Hon TONY RYALL: I am pleased to announce that the Government’s voluntary bonding scheme for doctors, nurses, and midwives has been oversubscribed for a second year in a row. Five hundred new health gradates have joined this year’s scheme. Around 1,400 doctors, nurses, and midwives have now been accepted into the scheme, which offers student loan write-offs or cash incentives to stay in New Zealand. This year’s intake includes 45 midwives, 392 nurses, and 64 doctors. Almost half of all the new midwifery graduates joined the scheme.

Hon Ruth Dyson: Why, when he was warned last year that the Australian Government was making changes that would make it easier for New Zealand general practitioners to work in that

country, did he sit back and do nothing? As a result, 59 rural practices have recorded a shortage of general practitioners since he became the Minister, and in the past year 26 urban practices have recorded shortages.

Hon TONY RYALL: The advice from Health Workforce New Zealand is that those changes in Australia will have a minimal impact in New Zealand. I remind that member of the thousands of New Zealanders who could not get a general practitioner when she was the Minister of Health.

Hon Ruth Dyson: Having last week dismissed the concerns of the staff at Wellington Regional Hospital in relation to their increased workload due to imposed annual leave entitlements, what will he now say to the woman who has gone public with the fact that last Thursday at Wellington Regional Hospital her mother was left lying in her own faeces for 3 hours, unable to get anyone to help her?

Hon TONY RYALL: Of course it is absolutely unacceptable if that were to happen. That lady is currently under an investigation. I am sure that all New Zealanders would be appalled if the nursing staff put her in that position.

Crime, Victims—Increased Support

4. CHESTER BORROWS (National—Whanganui) to the Minister of Justice: What recent announcements has he made about increased support for victims of crime?

Hon SIMON POWER (Minister of Justice): This morning the Minister of Police and I were pleased to announce the commencement on 1 July of a number of initiatives for victims of crime, including on-the-spot safety orders for victims of domestic violence, implementation of the $50 offender levy, enhanced support services for victims of homicide and sexual violence, and new information resources for victims of crime.

Chester Borrows: What other steps will the Government take to improve support for victims of crime?

Hon SIMON POWER: Officials will shortly report back to me on a range of options stemming from the public consultation document entitled A Focus on Victims of Crime: A Review of Victims’ Rights. The options are likely to focus on simplifying victims’ interaction with the criminal justice system and making the system more receptive to victims’ needs. The Government is committed to placing victims at the heart of the justice system.

Lynne Pillay: Has he made any announcements on his Government’s complete abandonment of victims and survivors of sexual crime, as last week it was revealed that in 6 months only 178 people had been approved for accident compensation counselling, and that figure had to be forced out under an Official Information Act request?

Hon SIMON POWER: I can report that in addition to today’s announcements I am working on a number of initiatives to improve the interaction of sexual violence victims with the criminal justice system. Those initiatives include setting aside additional funding for sexual violence prevention programmes and funding for the survivor advocate role.

Lynne Pillay: Will he appeal to the Minister for ACC to stop this ugly and offensive attack on victims of serious crime who are unable to get the help they need to heal in the aftermath of sexual abuse?

Hon SIMON POWER: I talk to all of my colleagues, including the Minister for ACC, about initiatives that the Government is taking in this area. Members opposite might be interested to know that at 3.30 today, with a bit of luck, I will be having my quarterly meeting with the TOAHNNEST— Te Ohaaki a Hine—National Network for Ending Sexual Violence—group, which brings these concerns to me and continues a very constructive dialogue with the Government.

Prisoners—Drug and Alcohol Rehabilitation

5. Hon CLAYTON COSGROVE (Labour—Waimakariri) to the Minister of Corrections: Does she stand by her statement on Close Up last night that “prison is a very expensive place to

send somebody to sort out their drug and alcohol problems. I’d much rather they were sorted out in the community”?

Hon JUDITH COLLINS (Minister of Corrections): Yes.

Hon Clayton Cosgrove: When she said that, was she aware that at least two drug and alcohol treatment units, based in Blenheim and Auckland respectively, are preparing to close their doors on offenders with drug and alcohol problems?

Hon JUDITH COLLINS: Yes, and I have spoken to the Minister of Health, and he has advised me that in the case of the Blenheim institution, the matter is being dealt with by the Ministry of Health, which will be taking over the matter. In relation to the other issue, which I think is in the member’s electorate, the matter is being dealt with in another way as well.

Hon Clayton Cosgrove: If she is advocating with the Government to sort out drug and alcohol problems within the community, why has her Government decided to discontinue the funding previously provided for St Marks Adult Drug and Alcohol Treatment Centre in Blenheim, and for the Care NZ clinic in Ōtāhuhu—not in Christchurch—both of which have been providing community rehabilitation services for offenders?

Hon JUDITH COLLINS: I have done my best to answer a question that could have been directed to the Minister of Health. Quite clearly, the Department of Corrections does not have responsibility for drug and alcohol treatment in the community, and I would have thought the member, as an experienced member, would know that.

Melissa Lee: What is the Government doing to help offenders with drug and alcohol problems while they are in prison and after they leave?

Hon JUDITH COLLINS: We know that drugs and alcohol are major drivers of crime in New Zealand, and that two-thirds of our prisoners enter jail with drug and alcohol problems. That is why this Government is committed to doubling the number of drug and alcohol treatment unit places from 500 to 1,000. Just last week I opened a drug and alcohol treatment unit at Otago Corrections Facility, and two further units at Wanganui and Auckland prisons will be completed by next year. I have also asked the Department of Corrections to look at an “outside the wire” drug treatment unit to help prisoners address drug and alcohol issues after they leave prison. Work is now under way to see how this initiative could be implemented— something the previous Labour Government never did.

Hon Clayton Cosgrove: Has she as Minister of Corrections at any time advocated to any of her colleagues that the Government should continue to fund the St Marks Adult Drug and Alcohol Treatment Centre or the Care NZ clinic in Ōtāhuhu?

Hon JUDITH COLLINS: I speak to my colleagues all the time, and I am constantly talking about the need to have drug and alcohol treatment services both inside and outside prisons.

Hon Clayton Cosgrove: I raise a point of order, Mr Speaker. With respect, that was a straight question. It asked specifically about advocacy, or the lack of it. It was not pertaining to a whole host of agencies, but to the St Marks Adult Drug and Alcohol Treatment Centre and the Care NZ clinic at Ōtāhuhu. It specifically asked whether she had advocated in respect of those two centres.

Mr SPEAKER: I invite the Minister, if she has that information, to let the House have it.

Hon JUDITH COLLINS: I speak to my colleagues all the time about this issue, and I am surprised to hear, as I understand, that the member asking the question has never advocated for this himself.

Hon Clayton Cosgrove: I raise a point of order, Mr Speaker. I will not waste your time. My point of order stands: the question was not about what I or any other colleagues have done. It was not about discussions the Minister may or may not have had in general; it was about advocacy, or lack of it, for two specific institutions.

Mr SPEAKER: The point of order is a reasonable one. The primary question did not exactly point to where the member’s supplementary question has gone, and that is why I invited the Minister to reply, if she had the information. But it is a reasonable question to ask whether the

Minister had advocated for issues relating to the Minister’s responsibility. The last answer from the Minister was not very helpful in attacking the questioner, and I think that the House would be interested in knowing whether the Minister advocated on those issues.

Hon JUDITH COLLINS: Thank you, Mr Speaker. I make clear that I have spoken to the Minister of Health about this issue in relation to both of these institutions.

Mr SPEAKER: I thank the Minister.

Hon Clayton Cosgrove: What credibility does her Government’s claim—that it is focused on the drivers of crime—have when programmes all around the country that have proven successful in preventing recidivism, such as St Marks, Care NZ Clinic, the Wellington Prisoners Aid and Rehabilitation Society, and Te Hurihunga are closing down due to her Government’s decisions to withdraw funding?

Hon JUDITH COLLINS: Well, it has an awful lot more than the previous Government has, frankly. The fact is we are increasing drug and alcohol treatment by 100 percent in our prisons within 3 years, whereas the previous Government had 9 years to do something about it and never did a thing. Those members sit there, and grandstand, instead of actually dealing with the issue.

Mōkihinui Hydro Dam—Criteria and Evaluation Process for Land Exchange

6. KEVIN HAGUE (Green) to the Minister of Conservation: What criteria and processes will she use to evaluate any land exchange proposed by Meridian Energy for the area of public conservation land it wishes to flood for its proposed Mōkihinui hydro scheme?

Hon Dr WAYNE MAPP (Minister of Defence) on behalf of the Minister of Conservation: The processes and criteria are set out in section 16A of the Conservation Act 1987. They are also guided by Conservation General Policy 2005 and other relevant statutory documents, such as the West Coast Te Tai o Poutini Conservation Management Strategy. The key criteria set out in section 16A are that the exchange will enhance the conservation value of land managed by the department and also promote the purposes of the Act. Land exchange applications are processes that are operated consistent with departmental procedures and the legislation.

Kevin Hague: What land currently outside public conservation land could possibly offset the drowning of 300 hectares of irreplaceable river gorge habitat for kiwi, blue duck, kākā, falcons, giant land snails, native bats, and long-finned eels, all of which currently live along the Mōkihinui River?

Hon Dr WAYNE MAPP: The member may be aware that an application was made then subsequently withdrawn by Meridian Energy. That particular application was released under the Official Information Act, and I am sure the member has a copy of it.

Kevin Hague: I raise a point of order, Mr Speaker. The supplementary question asked what land would fit that section 16A requirement, and the Minister has not addressed that question, at all.

Mr SPEAKER: I confess I thought the Minister’s answer was a fair way away from the question asked. I invite the member to repeat his question exactly; let the Minister hear it and provide an answer to the House.

Kevin Hague: What land currently outside the public conservation estate could possibly offset the drowning of 300 hectares of irreplaceable river gorge habitat for the kiwi, blue duck, kākā, falcons, giant land snails, native bats, and long-finned eels that currently live along the Mōkihinui River?

Hon Dr WAYNE MAPP: This application has not been considered by the Minister, and it would be inappropriate for the Minister to make a comment prior to the application. I mentioned the Official Information Act request because it dealt with land that Meridian Energy had offered. That application was withdrawn, as the questioner may well know.

Kevin Hague: Is she familiar with a Landcare Research report tabled in this House in 2008 that concluded that it is impossible to offset the biodiversity loss that this dam would cause; if so, does she accept that Landcare Research advice?

Hon Dr WAYNE MAPP: I cannot say whether the Minister would be aware of that. But the Minister is well aware of the application. The Minister cannot make comment at this stage. That would prejudice her consideration of a future application. As she is the decision-maker, public comment on the merits would be inappropriate.

Kevin Hague: Is it the case that Meridian Energy withdrew its first land exchange offer because that offer had been firmly rejected by the West Coast Tai Poutini Conservation Board and the Department of Conservation; if so, why was it rejected by her department?

Hon Dr WAYNE MAPP: As I indicated, the original application was made and released under the Official Information Act. It is correct that the department did not recommend that the application be accepted, because it did not meet the criteria of the Act. At this point in time there is no other application by Meridian Energy. It is also worth noting that this issue is yet to go through the Environment Court appeal processes, and, as the member will probably know, the department is not supporting that appeal.

Kevin Hague: Can she give a single example of land that would represent an acceptable exchange and is not already protected?

Hon Dr WAYNE MAPP: It would be inappropriate to answer that question, because that in effect would be looking to prejudge the merits of the application.

Kevin Hague: Does she agree with her colleague Gerry Brownlee, who last year told a Nelson audience: “The Mokihinui will not go ahead. I don’t think you are going to see any large scale dams built in the foreseeable future.”?

Hon Dr WAYNE MAPP: The member may be also aware that Minister Gerry Brownlee also indicated that such comments were being taken out of context. In any event, the Minister of Conservation has the statutory authority to deal with any applications. Indeed, she must act statutorily.

Kevin Hague: Does she accept that there is no land exchange that could meet the criteria she needs to apply; therefore, could she not save enormous expenditure of time, effort, and money from all parties, including Meridian Energy, by ruling out any possible land exchange right now?

Hon Dr WAYNE MAPP: I have already answered that question: to give an answer would preempt her decision on any potential application. She must apply the criteria set out in the Act, and therefore she must act in a statutory manner.

Kevin Hague: I seek leave to table a document that provides a link to an audio recording of Minister Brownlee’s comments that I have cited in the House, from the Nelson Mail.

Mr SPEAKER: I take it that it is a link to a newspaper article?

Kevin Hague: Yes, it is a newspaper article.

Mr SPEAKER: We will not be doing that.

Prisons—Smoking Ban

7. SANDRA GOUDIE (National—Coromandel) to the Minister of Corrections: What steps are being taken to make prisons safer and healthier for staff and prisoners?

Hon JUDITH COLLINS (Minister of Corrections): I am pleased to report that from 1 July next year all prisoners in New Zealand jails will be banned from smoking. About two-thirds of prisoners smoke, and this exposes staff and prisoners to serious harm. Research into the air quality in prisons shows that staff and prisoners can be exposed to 12 times the level of second-hand smoke that is in the home of an indoor smoker. The policy will also mean that there is no need for prisoners to have lighters or matches. These have been used to set fire to bedding, and to light balls of paper that have been thrown at corrections staff. Our hard-working officers deserve better than that, and I fully support the introduction of the ban. With this photograph I show the House an example of just what can happen in a prisoner’s cell when there is access to lighters and matches.

Sandra Goudie: How will the introduction of this policy be managed to ensure it is successfully implemented?

Hon JUDITH COLLINS: There will be an extensive 12-month campaign prior to the introduction of the ban to encourage staff and prisoners to give up smoking. This campaign will be led by the Department of Corrections and supported by the Ministry of Health and the Quit Group. The campaign will include information, education on smoking, and support to quit smoking. Prisoners will also be offered an 8-week course of nicotine replacement patches. All youth units in New Zealand prisons have been successfully operating as smoke-free environments. Smoking is also banned in police station holding cells and secure mental health facilities. I have every confidence that the Department of Corrections will implement this policy successfully.

Accident Compensation—Surpluses

8. Hon DAVID PARKER (Labour) to the Minister for ACC: Did he tell the Transport and Industrial Relations Committee on Thursday, 24 June 2010 that ACC was in a stable position with $2 billion of surpluses?

Hon Dr NICK SMITH (Minister for ACC): That is an inaccurate summary of the transcript of my comments at the select committee. I noted that the accident compensation scheme’s investments had turned round dramatically but were still quite volatile, that the scheme’s liabilities had grown dramatically under Labour but are now stabilised, and that after losses of $2.4 billion and $4.8 billion I was expecting a surplus of about $2 billion this year. I urged caution at the select committee over the projected surplus, because the accident compensation scheme still has liabilities of $25 billion and assets of only $14 billion, such that ongoing surpluses will be required to close the gap and meet the legal requirement of full funding by 2019.

Hon David Parker: Given that, to use the Minister’s own boastful words last week, the accident compensation scheme has made enormous progress, is in a stable financial position, and is expecting a $2 billion surplus this year, and that that has all been achieved by the Accident Compensation Corporation (ACC) as a publicly owned and operated entity, does the Minister not see that that fundamentally undermines his case for privatisation?

Hon Dr NICK SMITH: I note that National’s policy of investigating competition in the work account was announced long after we knew of the huge mess that Labour had left in accident compensation, where costs grew by 57 percent—or by over $1 billion in claim costs—and in which administrative costs were out of control. On the issue of competition, I say that this Government and the Prime Minister have made plain that the test for this Government will be ensuring the best quality of service and efficiency for our accident compensation services.

Hon David Parker: Does the Minister now accept that he exaggerated problems and beat up a crisis so as to justify his plans to cut cover and to privatise accident compensation?

Hon Dr NICK SMITH: Absolutely not. We need look only at the more than $10 billion increase in the liabilities of the accident compensation scheme, the breach of the Public Finance Act, and the increase in claim costs of 57 percent to know the sort of incompetent governance the previous Government had in respect of accident compensation.

Michael Woodhouse: What savings has the Government been able to achieve in the administration and claims management costs of ACC, and how does that compare historically?

Hon Dr NICK SMITH: In the last year ACC has made savings in its own costs of $35 million—a saving of 7 percent. This includes savings of 52 percent in domestic travel, 45 percent in international travel, and savings in communications, in sponsorship, and in the corporate office. In contrast, I note that during the previous 4 years ACC’s administration costs grew from $302 million to $494 million—an increase in admin costs of $50 million each and every year during the last years of the Labour Government. That is typical of the sort of mismanagement that occurred right across the public sector, which this Government is now having to deal with.

Hon David Parker: Why has the Minister refused to release under the Official Information Act the two stocktake reports on the accident compensation scheme he has had for months? Is it because

they would be useful for critics of his privatisation plans? If he has no such worries, why not just release them now?

Hon Dr NICK SMITH: The full stocktake report has not been received by the Government. It is exactly the same practice that has always operated, and that is that reports will be released after the Government has made a decision. Neither Cabinet nor any Cabinet committee has given any consideration to the issue of competition in the work account and will not do so until such time as it receives the full stocktake report.

Hon David Parker: Is the Minister embarrassed that he was forced to admit at the select committee that his earlier statement that self-insuring large employers have a better rehabilitation record, which he has used to justify privatisation, was based on no evidence whatsoever and was merely an assertion?

Hon Dr NICK SMITH: The member is making it up. The transcript shows that the claims he is making about what occurred at the select committee are quite incorrect, and the interesting part—

Hon Trevor Mallard: Now the transcripts are accurate; they were inaccurate before.

Hon Dr NICK SMITH: If Mr Mallard would like me to table the transcript from the select committee I would be more than happy to so that people can see what was said. I assure the member that National is not ideologically opposed to the private sector having a role in accident compensation. We will do what is best for New Zealand, for claimants, and for those who pay the accident compensation levies.

Foreshore and Seabed Act Review—Access Under Customary Title

9. DAVID GARRETT (ACT) to the Attorney-General: Will any legislation replacing the Foreshore and Seabed Act 2004 contain a clause preventing the Māori owners of sections of the foreshore and seabed held under customary title from charging or attempting to charge other New Zealanders for access to the beach?

Hon CHRISTOPHER FINLAYSON (Attorney-General): Cabinet has not yet made final decisions on the content of the draft legislation. It is not for me to prejudge Cabinet deliberations, and, of course, one must pay close attention to the detail of the legislation. What I can say is that public access in, on, and over the public foreshore and seabed will be guaranteed, subject to authorised limits, such as for public health and safety reasons. For example, no one reasonably expects the public to have unfettered picnic rights at naval bases.

David Garrett: How will the Māori ownership of sections of the foreshore and seabed differ from Ngāi Tahu’s ownership of the bed of Lake Ellesmere, vested in the tribe under section 168 and following sections of the Ngāi Tahu Claims Settlement Act 1998, which has led to Ngāi Tahu charging eel fishers 8 percent of the value of their catch?

Hon CHRISTOPHER FINLAYSON: In the case of Ngāi Tahu, that was a statutory vesting under the settlement Act of 1998. Customary title will be awarded under the replacement to the 2004 legislation, and public access will be guaranteed.

Attorney-General—Confidence

10. Hon TREVOR MALLARD (Labour—Hutt South) to the Prime Minister: Is he satisfied that the Hon Christopher Finlayson has shown sufficient attention to detail to retain his confidence as Attorney-General; if so, why?

Hon JOHN KEY (Prime Minister): Yes, because he is proving himself to be an outstanding Attorney-General.

Hon Trevor Mallard: Has Mr Finlayson informed him or his office of any matter, other than that relating to Te Puhi Trustee (2) Ltd, that should have been declared by way of the Registry of Pecuniary Interests of Members of Parliament by Mr Finlayson and has not been?

Hon JOHN KEY: I have no recollection of those, no

Hon Trevor Mallard: Has Mr Finlayson told him that he has made false declarations other than the matters that came to light last week?

Hon JOHN KEY: The member is making an assumption. If we examine the member’s track record, we see that he is normally wrong.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. It was a very carefully worded question, and it—[Interruption] Well—

Mr SPEAKER: The member will not react.

Hon Trevor Mallard: There is no debate. It has been brought to your attention, Mr Speaker, that Mr Finlayson has made false declarations, and he has accepted that. I think that a question asking whether another has been brought to the Prime Minister’s attention deserves a proper answer.

Mr SPEAKER: The Prime Minister has no responsibility for the Registry of Pecuniary Interests of Members of Parliament. However, if a member has told the Prime Minister that a Minister may have made an error in that register, I guess the Prime Minister has a responsibility for his Ministers. If the Prime Minister has been asked by the member whether there are any other errors, then I guess the Prime Minister should answer the question. It was pretty specific as to whether the Attorney- General has told the Prime Minister of any other errors.

Hon JOHN KEY: No, the Attorney-General has not. I am aware that there was an error on behalf of Mr Finlayson’s lawyer at one stage, in relation to an address with the Companies Office, but Mr Finlayson and I have not discussed that.

Hon Trevor Mallard: Would Mr Finlayson continue to enjoy his confidence as Attorney- General if a further false declaration came to light?

Mr SPEAKER: I think that is an unreasonably speculative question. I do not think it is reasonable to imply when asking a question that a member may behave improperly. I do not think that is reasonable. I will give the member a chance to reword the question.

Hon Trevor Mallard: If a member in this House tabled a document that showed that Mr Finlayson made a further false declaration, would he continue to have confidence in him? I raise a point of order, Mr Speaker.

Mr SPEAKER: I am not sure what the point of order is. The member has just asked a question and he is now raising a point of order. I will hear him briefly, but I want to know very quickly what the point of order is.

Hon Trevor Mallard: I seek leave to table a Companies Office record that shows that Mr Finlayson made another false declaration.

Mr SPEAKER: A member must not make allegations of improper behaviour when seeking leave to table a document. The member must describe the document, and no more. I will give the member a further chance to simply tell the House what the document is.

Hon Trevor Mallard: It is a Companies Office record for Diana Bremner Trust Nominees Ltd.

Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is no objection. Document, by leave, laid on the Table of the House.

Hon Trevor Mallard: Supplementary question, Mr Speaker.

Mr SPEAKER: The member just asked a supplementary question.

Hon Trevor Mallard: I have not finished yet. I was interrupted.

Hon Rodney Hide: I raise a point of order, Mr Speaker. The member actually interrupted himself. There is a personality problem—

Mr SPEAKER: It may have escaped Ministers’ attention, but when I am on my feet silence means silence. The member was doing perfectly well until that point. The Hon Rodney Hide knows that that is no way to conduct a point of order. The first point he made was not unreasonable, though. The Hon Trevor Mallard did interrupt himself. He had asked a question, but the problem with the question he asked was that it still implied that a Minister may have done something

improper, and members know that it is outside the Standing Orders to make that implication in a question. I gave the member an opportunity to reword the question, and I must now move on.

David Garrett: What confidence does he have in the Attorney-General’s attention to detail, given that he told Parliament on 16 June: “I believe … that we are not talking about very much, at all.”, but then said in a television interview 4 days later: “In the round I think, based on the sort of information I have, based on my talking around the place, I’d say about 10%,” of the foreshore and seabed? Does the Prime Minister agree that 2,000 kilometres of coastline is “not … very much, at all.”?

Hon JOHN KEY: Yes, I have enormous confidence in the Attorney-General and Minister for Treaty of Waitangi Negotiations. He is proving that he can resolve issues that the previous Labour Government completely failed to. What level of the coastline goes into the foreshore and seabed customary title is purely speculative, and the truth is that none of us know.

Hon Trevor Mallard: Is he relaxed about having as Attorney-General—a role that requires precise legal declarations—someone who has already admitted making four false declarations?

Hon JOHN KEY: I am very confident in the Attorney-General. If one looks at the situation where the proposed, or the alleged, false declarations were made, one sees that at the point at which the error was raised Mr Finlayson immediately took the matter up with the Registrar of Pecuniary Interests of Members of Parliament. Subsequently he has been advised to change his listing. I might add, though, that it is not uncommon. Members from all parties do that from time to time, including Maryan Street.

Hon Gerry Brownlee: I raise a point of order, Mr Speaker. I suspect that matters relating to this question could return to the floor of the House on a regular basis in the weeks ahead. On behalf of members, I would like you, please, to look at Standing Orders 159, 160, 161, and 162. I do not want you to comment on those today but I would like you to consider how Standing Orders 160 through to 162 and their various parts relate to Part 1 of Appendix B of the requirements under Standing Order 159. I am simply saying that it appears that we are straying into territory that wants to make a distinction between a pecuniary interest in a financial sense, which is the requirement strictly of Standing Orders, or an interest declaration of a non-pecuniary nature. I think that this distinction is causing some difficulty for some members. It certainly will cause a lot of difficulty for all members in the future if, in fact, the difference between an interest in a broad sense and a financial interest whereby there is pecuniary advantage to a member is not clearly sorted out. It would seem that the registrar has failed members in this regard, because there is no ruling. It would seem further from the strength of the Standing Orders that in the end it is the Speaker who rules on these matters. I ask you to give it some consideration and perhaps come back to the House to define the difference between an interest and a pecuniary interest.

Hon Trevor Mallard: Speaking to the point of order.

Mr SPEAKER: I will hear the honourable member briefly.

Hon Trevor Mallard: I think it would be valuable if you did that, but as you do it, it would be good for you to look at the ruling that Dame Margaret Bazley has made in the case of Mr Finlayson. She made it clear that the words “declare all directorships” mean that one must declare all directorships.

Mr SPEAKER: I hear the honourable members, and I appreciate the issue raised by the Hon Gerry Brownlee. I think there are grounds for uncertainty here because the Standing Order relates to declaring pecuniary interests. That is the point that the Hon Gerry Brownlee made. The problem is not one of the registrar; it is the way in which Appendix B is constructed. It is a matter that we may well need to look at again. I am not sure the Speaker should rule on the matter alone. I think the matter may need to be referred back to the Standing Orders Committee at some stage. In the meantime, members need to, in so far as is possible, comply with the recommendation made by the Registrar of Pecuniary Interests of Members of Parliament. But we need for the future to make sure the Standing Orders are clearer on what is required. I think there are reasonable

grounds for uncertainty where we have a register of pecuniary interests, and it seems that members are also required to register matters that are not pecuniary interests. That would be my way of handling it rather than trying to sort it out on my own. I think it is a matter that needs reference back to the Standing Orders Committee. I thank honourable members.

Petrobras—Exploration Permit

11. TE URUROA FLAVELL (Māori Party—Waiariki) to the Minister of Energy and

Resources: Kei te whakaae a ia ki te kōrero a Api Mahuika, te Manakura o Ngāti Porou, nā te kore kōrero tahi ki te iwi kua waiho e te Karauna te Tiriti ki rahaki, ā, hinga tonu atu te tino rangatiratanga o te Māori i roto i te whakaaetanga o te Karauna kia keri-whenua a Petrobras; ki te kore, he aha ai? [Does he agree with Ngāti Porou leader Api Mahuika that the Crown acted outside the Treaty because it has not consulted and has failed to honour a guarantee to protect the rights of Māori, in its granting of an exploration permit to Petrobras; if not, why not?]

Hon GERRY BROWNLEE (Minister of Energy and Resources): No. The minerals programme for petroleum 2005 lays down requirements for consultation with relevant iwi when issuing petroleum blocks offers. In this case, the Raukūmara block offer, that consultation did take place. I seek leave to table a chronology of engagement with iwi relating to the Raukūmara block offer.

Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is no objection. Document, by leave, laid on the Table of the House.

Te Ururoa Flavell: He aha tāna ki Aotearoa whānui ki te whakahē i tā Manu Caddie i kōrero nei, he “shameful environmental record” tā Petrobas, ā, ka raru te taiao i ngā mahi keri-whenua? [What assurance can he give New Zealanders to counter the claims by Manu Caddie that Petrobras had a "shameful environmental record" and that there are environmental risks inherent in the oil drilling operation?]

Hon GERRY BROWNLEE: I do not know who Manu Caddie is, and I do not have any responsibility for any comments that he makes. However, I would say that it is widely acknowledged that Petrobras has spent many billions of dollars on safety over the past decade. The company has developed its own robust, 15-point health, safety, and environmental guidelines. Most important, New Zealand—since the National Government introduced it—now has the Environmental Protection Agency, soon to be a stand-alone agency, which will have responsibility for issuing permits in the exclusive economic zone. I would expect that the agency will develop the very highest of standards required for anyone undertaking any exploratory activity in the exclusive economic zone.

Te Ururoa Flavell: Ka aha ia ki te whakatau i ngā āwangawanga kua koropupū ake i roto i a Te Whānau-a-Apanui, a Te Tai Rāwhiti, a Ngāti Porou, a Tūranga-nui-a-Kiwa nā ngā mahi o te Kāwanatanga ki te tuku i te Raukūmara basin ki a Petrobras International? [What actions will he take to address the evident loss of goodwill being felt by Te Whānau-a- Apanui, Te Tai Rāwhiti, Ngāti Porou and Tūranga-nui-a-Kiwa because of the Government's action in signing over the Raukūmara basin to Petrobras International?]

Mr SPEAKER: Did the Minister hear the entire question?

Hon GERRY BROWNLEE: I think I heard enough of it to understand what the gist of it was. The first point I would make is that goodwill and good faith is something that goes two ways, and I would suggest to the member that I also feel as if there has been a breach of good faith by the parties mentioned in their dealings with me. But I will make clear that I was prepared to publicly apologise—and I did so—to both Ngāti Porou and Te Whānau-a-Apanui immediately after the block offer was signed up with Petrobras. But I also tabled today, for all members to see, a very

lengthy consultation exercise undertaken with those iwi. I think we have discharged our responsibilities appropriately. I am sorry that it is not to the standard that those two groups particularly would demand for themselves. But, in the end, these are nationalised minerals and the Crown has a right on behalf of New Zealand to consider what potential they may have to add to our economic well-being.

Hon David Parker: Has the Minister advised the Māori Party that if it does not like the fact that oil and other petroleum products are nationalised and will not form part of Treaty rights—or, indeed, foreshore and seabed rights—that it could actually vote against the foreshore and seabed legislation that his Government is bringing forward?

Hon GERRY BROWNLEE: I think the efforts of my opponent over there to try to sow seeds of discord are a total waste of time. This matter has been discussed widely between all parties, and what we are seeing is a disagreement between one Minister of the Crown and two parties to the arrangements. I am sure that it will be sorted out, because in the end—[Interruption]—once we get past all the trumpeting—what those parties want, what National wants, and what the Māori Party wants is the same thing. It is for people’s rights to be protected as their interests stand in the foreshore and seabed, and I am confidant that that is where we are heading.

Triathlon ITU World Championship Series Grand Final—Government Support

12. NIKKI KAYE (National—Auckland Central) to the Minister for Economic

Development: What support is the Government providing for New Zealand’s hosting of the 2012 Triathlon ITU World Championships Series grand final?

Hon GERRY BROWNLEE (Minister for Economic Development): The Government yesterday announced that $900,000 has been allocated from the Major Events Development Fund to enable Triathlon New Zealand to host the 2012 Triathlon ITU World Championship Series grand final in October of 2012. There will, of course, be associated tests at this event in late 2011. Triathlon is the fastest-growing sport in New Zealand, and local triathletes regularly do well in international events. Around 4,500 triathletes and supporters are expected to come to New Zealand for the grand final. Triathlon New Zealand’s feasibility study estimates that the event will have an impact, economically speaking, of about $30.9 million on the New Zealand economy—and who knows who else may be motivated to give triathlon a go if it all looks pretty good.

Nikki Kaye: What other major events has the Government—

Mr SPEAKER: I apologise to the honourable member, but I could not hear that question. A little more reasonableness with interjections, please.

Nikki Kaye: What other major events has the Government supported recently?

Hon GERRY BROWNLEE: The Government has provided funding for a number of major events, including the 2012 Volvo Ocean Race stopover, the American Express Queenstown Winter Festival 2010, the 2010 New Zealand International Festival of the Arts, and the 2013 UCI BMX World Championships. They provide a pipeline of events that will maintain New Zealand’s major events profile and enhance New Zealand’s reputation as a host capable of presenting events in a very substantial way. They will provide television coverage of our country and will contribute to the promotion of New Zealand, and that will help others to see New Zealand as a visitor destination.

ENDS

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