Hon DAVID PARKER (Minister of Energy) Link to this
I move, That the Electricity (Disconnection and Low Fixed Charges) Amendment Bill be now read a first time. At the appropriate time I intend to move that the bill be referred to the Commerce Committee.
This bill responds to recent concerns about the disconnection practices of electricity retailers, particularly in relation to vulnerable consumers. It is designed to ensure that the Government can, if necessary, regulate the content of the disconnection guidelines that have been recently developed. This bill amends the Electricity Act 1992, as the Act does not currently contain sufficient powers to regulate disconnection processes, or to regulate the full content of the guidelines. The bill also amends the regulation-making power in the Act relating to consumer contract terms, because at present the Act requires retailers to include only the regulated matters in their contract. Once retailers have done this, they have complied with the regulation. If they breach their own contract, they are not breaching the regulations, so they are not subject to the penalty provisions in the Act.
The Electricity Commission has been working with electricity retailers, Government ministries, and social agencies to develop new guidelines for dealing with disconnections. Retailers have been given the opportunity to follow the guidelines, and this bill will allow for the content of the guidelines to be regulated if retailers fail to adhere to the guidelines voluntarily. The new guidelines will ensure that consumers having difficulty paying their bills are advised of the assistance available from community service providers and Government agencies. The guidelines will also protect vulnerable consumers, and those reliant on electricity for medical equipment that maintains life.
In summary, this part of the bill improves the ability to regulate for arrangements regarding the process for disconnection following non-payment of accounts, for reconnection, for billing information and processes, and for alternative payment options such as smooth payments, redirection of income, and debt recovery. The bill also regulates for the process of identifying consumers who would be at risk if their electricity were disconnected, and includes proposals relating to mandatory terms and conditions for the supply of electricity and line function services by electricity retailers and distributors.
The bill consists only of regulation-making powers. It does not alter any of the existing processes or requirements in the Electricity Act relating to the making of regulations. Under the Electricity Act 1992, regulations or rules can be made only if they implement a recommendation from the Electricity Commission. The Electricity Act requires the commission to satisfy itself that other options, such as voluntary arrangements, are unlikely to achieve the Government’s objectives. Nothing in the bill overrides the Privacy Act, either.
I have been encouraged by the attitude of retailers, who have dedicated time and resources in recent weeks, both internally and with the Electricity Commission, to ensure that their processes are adapted to prevent any repeat of the events in May. I am confident that they are willing to follow the guidelines. The regulation-making powers that the bill will create are important as a measure of last resort, to enable regulations to be made to ensure that Government objectives are met.
The bill also addresses specific concerns around the regulations for the low fixed-charge tariff options for domestic consumers. The low fixed-charge regulations were introduced in 2004, with the purpose of assisting low-use domestic consumers and encouraging energy efficiency. Prior to the introduction of those regulations, low-use consumers in many areas faced unreasonably high fixed daily charges for their limited or low electricity usage. The introduction of regulations provided these low-use consumers with a tariff option that was more equitable for low-energy users, and compatible with the Government’s energy efficiency objectives.
At present, these regulations require networks and retailers to make available a low fixed-charge tariff option to all domestic consumers whom they service, who have consumption at their primary dwellings of less than 8,000 kilowatt hours per annum. That same 8,000-kilowatt-hour threshold is used across the entire country, despite the reality that in colder parts of the South Island the average power use is higher, in large part because the climate is colder and there is little reticulated gas. Analysis of average consumption data shows that an adjustment to the low fixed-charge eligibility threshold of 8,000 kilowatt hours per year is warranted, because far fewer consumers are on a low fixed-charge tariff in the lower South Island than in other parts of the country. For example, in Auckland and the north, currently over 52 percent of domestic consumers are covered by the low fixed-charge tariff, whereas in the lower South Island, being Christchurch south and excluding Westland, that figure is only 9.2 percent.
The bill alters the definition of a low fixed-charge consumer from being a consumer with a fixed threshold of 8,000 kilowatt hours, as currently defined in the Act, to being a consumer under a definition to be provided in regulations, so that different regional locations and averages can be used. Subsequently, the regulations will be changed to set that threshold in the lower South Island, from Christchurch south and excluding Westland, at 9,000 kilowatt hours, which is the average domestic consumption level for that region. This will enable a greater number of lower South Island consumers to benefit from having a low fixed-charge tariff option. I do not want to overstate the benefits here. The differences between the tariffs are not huge, but they are material for some low-income consumers.
Another change in the bill is the extension of the Minister’s powers to grant an exemption from the application of the regulations to electricity distributors or retailers. The change is directed at small, isolated networks that are not connected to the national grid. In these small, isolated networks the cost of servicing customers can be far higher than is the norm for grid-connected networks, and in such circumstances the compliance requirements and business costs of administering the low fixed-charge tariff can be excessive. This has the potential to affect the economic viability of these small, isolated networks. In this circumstance it may be more equitable to exempt the entire network from having that low fixed-charge tariff requirement, so that the proposed amendment enables such networks to apply for an exemption. The amendment is required because the existing wording in the Act allows for only a subset of customers within the network to be exempted, not the entire network. Thank you, Mr Deputy Speaker.
GERRY BROWNLEE (National—Ilam) Link to this
The National Party will support the Electricity (Disconnection and Low Fixed Charges) Amendment Bill going to a select committee, because it does not hurt to have these sorts of matters discussed. But we cannot be overly enthusiastic about what the bill actually does, because it is clear that this is the Government’s response to everything that Helen Clark had to say at the time of the tragedy that beset the Muliaga family in South Auckland. Essentially, this bill appears to give the Minister the power to regulate as to how disconnections might be carried out if the industry itself does not come up with a satisfactory arrangement and put it in place in a way that means that that sort of event could not occur again. That is all fine; that is just what one would expect in a country like this. I doubt whether the Minister will ever have to use those regulations, because I think it is in the interests of the power companies—which are, in the main, Government-owned anyway—to make sure they have good protocols in place.
The issue of the low fixed charge is an interesting one, because there is no doubt that in the South Island the opportunities to heat homes are pretty much limited to either solid fossil fuel burning or the use of electricity. We do not have a large gas market down there. People do not have reticulated gas anywhere, and certainly do not have natural gas in the way that people have it in the North Island. A number of people use bottled gas, etc., but, by and large, the growing need for heating is being met from electrical energy. It is just a simple fact that it is colder in the South Island than it is in the North Island, and we still do not have, in my opinion, adequate incentives in place to encourage people to retrofit their homes with the proper insulation they would need in order for the greatest efficiency to be achieved by the use of that electrical energy. I think we also have some funny views in that regard about the use of solid fuel, but that issue is not up for comment in the debate on this bill.
The Minister, quite rightly, says that the threshold at which the low-user charge applies is to be moved out by 1,000 kilowatt hours a year. On the face of it, that measure looks reasonably good. But we have to remember that people are using that 1,000 kilowatt hours, so it is only an extra 1,000 kilowatt hours at the low tariff, whatever that might be, and we are hearing evidence that that may be as little as $18 a year. So here we have legislation to give low end-users as little as $18 a year. It would be many, many years before they could possibly save enough to pay for the cost of putting this bill through Parliament in the first place.
The big problem in New Zealand with regard to electricity prices is that we have a scarcity of supply. Everyone says that that is not right, because the lights have not gone out and we are meeting demand, etc. But it is a fact that we are reasonably well balanced. If anyone chose to look at the retail portfolios of the generators, then they would find that the demand from their retail portfolio is pretty much balanced with their capacity to generate. We know that each year there is a further demand for another 2 percent or so on top of the electricity that is currently generated. So the market is growing and the industry is only just keeping pace with the demand that it has to supply.
That is not a recipe in which to see power prices fall. I know that in some parts of the South Island, at least one power company has sent out a letter in the last couple of weeks stating that on 1 October electricity prices will rise by about 4.5 percent. Even with the passing of this legislation, one can guarantee that it will mean that people at the low end of the scale, who take advantage of the low fixed-charge rate now, will in fact pay more for their electrical energy, simply because the price will go up. Until the Government does something about increasing the amount of available electrical energy and encouraging power companies to invest more in generation, then we will not make much progress as far as prices are concerned.
I think that one of the things that is holding up decisions on where our generating industry goes is the whole issue around climate change and what it will cost, in climate change terms, to generate electricity in the future. We know, for instance, that without the Huntly power station, the lights would be out right now. This year, when we get into peak-load situations, without the E3P gas plant at Huntly we would be in dire straits. So we are heavily reliant on a sector of the industry that is likely to face significant climate change costs. We have a dual-edged sword, if you like, where we know that demand is just being met, so therefore prices can rise, but we have those other added costs about to go into the industry, which will further force prices up. With all due respect, I tell the Minister, I think this bill is a nice idea, but it is not quite enough for those people who need some help. The only way that prices will go down, in my opinion, is if we have a considerable amount more in generation.
I understand that this bill is to be referred to the Commerce Committee. It is my privilege to chair that committee, and I look forward to the submissions that we will receive on this bill. If we do not get very many, we will require various organisations to come along and talk to us about it.
I do not see in the bill any suggestion that there is a time line for electricity retailers to comply voluntarily with the disconnection arrangements. I think that without that, the general power given to the Minister means very little. It would be nice to think that there was a window of, say, 6 months where power companies themselves could come up with their proposals, and then if they did not meet those, they would know that the Minister at a fixed date would regulate on what was to happen. As I have said before, most of those power companies are State-owned, so one would think it would be pretty easy for the Minister to get voluntary compliance on that from a large sector of the industry.
I am sorry; I have not finished, but I am just—
Darren Hughes—no—taking a moment to consider whether we could widen this debate a little, because the issue of transmission costs is one that needs to be looked at here, as well. I do not see in this bill any particular reference to Transpower or to what its particular proposals are. The Minister, Mr Parker, is shaking his head, which leaves me wondering why he has not mentioned Transpower in the bill. A lot of the charges do come from transmission; we have to be realistic about it. A good deal of our power is generated in the South Island, and a great deal of our power is used at the other end of the country. So there is an issue, running through there, of getting the stuff out of the South Island. We know that the full capacity of South Island generation is not being fully utilised because of the constraints on the transmission lines. So although we have this bill about disconnections and low fixed charges, it might have been interesting, I would think, to have had some comment in the bill about the expectations that the Minister has of Transpower, which is the major delivery agent for electricity throughout the country.
National members will consider these matters appropriately at the select committee, and I welcome the opportunity to discuss this bill with all those whom I know will be interested in making submissions to the committee.
MARYAN STREET (Labour) Link to this
In May of this year, New Zealand witnessed a tragic event when the Muliaga family had the power disconnected at their home. That brought out some glaring gaps in the operation of our State-owned enterprises. State-owned enterprises originally came out of public services, which were previously wholly operated by the Government through the Public Service. In corporatising them in the 1980s and later, commercial imperatives, which had previously been absent, were introduced so that the Crown’s investment in these services could be rewarded. In some measure this bill represents a righting of the balance, if you like, a restoration of some social imperatives to services that are no longer luxuries but essentials.
In the first instance, the Minister of Energy talked about the new guidelines that will apply to electricity retailers. These retailers must advise consumers who may have difficulty paying their bills of the assistance that is available from Government agencies and community service providers. They must also take steps to identify vulnerable consumers who are having difficulty paying their bills, and consult with the Ministry of Social Development and Employment before disconnecting vulnerable consumers. At no time during this process can a retailer disconnect vulnerable consumers. Retailers must also identify those consumers reliant on electricity for medical equipment to maintain life, and not disconnect those consumers.
We are confident that electricity retailers will follow the guidelines to prevent a repeat of the May tragedy, but the regulating power contained in this legislation is an important last resort to ensure that the Government’s objectives are met. These objectives are both commercial and social.
I commend the electricity industry for the steps it has already taken, as witnessed by the television advertising campaign with the inspired choice of Jonah Lomu fronting the campaign. The use of an icon such as Jonah Lomu will bring the message home very quickly and very clearly. I commend the industry for that. Clearly, that is an example of the industry responding proactively. However, as I say, the regulating power is an important last resort to ensure the Government’s objectives are met.
In respect of the second purpose of this bill, it is clear that as many as 70,000 households from Christchurch south could face smaller bills under the proposed changes to electricity tariff charges. The Minister was careful not to overstate that benefit, but in fact any assistance to households, particularly low-income households in respect of the provision of adequate heating during winter, is to be welcomed and not sneered at. It would appear that although 50,000 or so lower South Island households may have already benefited from the 8,000 kilowatt limit, another 20,000 should be eligible under the higher threshold, and that is helpful.
I trust that this bill—if it proceeds, as the Minister intends, to the Commerce Committee—will get an adequate and appropriate hearing. I have the privilege of sitting on that select committee, and I look forward to the discussion around the two essential items that this bill brings to the supply of electricity in this country. It should be registered that the social imperatives for the provision of electricity supply should not be overtaken again in the future. I look forward to the consideration of this bill at the committee.
CHRIS AUCHINVOLE (National) Link to this
I rise to speak to the Electricity (Disconnection and Low Fixed Charges) Amendment Bill, and in keeping with the advice already given by Gerry Brownlee, I add that National supports this bill’s referral to the Commerce Committee. There are two aspects of this bill, the first being the disconnection of electricity and the second being the low fixed-charge tariff options for consumers.
The Minister has just told us that this bill does not really alter the Electricity Act 1992; it just introduces more regulations. Well, well, well! What a surprise; more regulations from a Labour Government! What a surprise! How do Labour members really imagine that this will make a difference?
Indeed, let us look at the purpose. The bill ensures that the Government can regulate the content of voluntary disconnection guidelines that the Electricity Commission has recently developed in response to the sad, tragic, and avoidable death of Mrs Muliaga. These guidelines include the requirement for the following: regular communication to all consumers on their payment options—is that not something that should already be built in to standard commercial treatment—arranging debt recovery in time frames that are suitable for the retailer and that minimise hardship to the consumer; ensuring that consumers enter into the most appropriate contracts for their needs; providing consumers with the opportunity to identify themselves as potentially vulnerable; consultation with the Ministry of Social Development to assist vulnerable consumers who are unable to pay; a visit to a consumer’s home before the final disconnection takes place; and the fact that consumers who require electricity for critical medical support will not be disconnected for non-payment.
One would be forgiven for saying that they look like sensible points, and that surely they are built into current practice. But do they really need to be put into legislation? Are electricity companies so far removed from reality that they have to be told every minutiae of detail? Are we simply trying to impose liability? Is this not a little like so many of the other regulations this Government loves to make?
No, no—let us look at it. It is like microchipping dogs. How will that stop a dog from biting someone? It is like so many of the regulations that Labour members live by and stand by to give the appearance of doing something.
Voting it down is not quite the point. I guess the member would prefer that. He would much prefer that, because that is his style: vote it down, do not discuss it, and do not debate it; this is it, take it or leave it. I think that that is what will happen now with the proposed legislation on changing the electoral law. We have already had an example of that. It will be rammed through. It will be a case of: “Let’s not discuss it, and let’s not criticise it.” Well, that is not my experience of working on the consumer—
No, no, on the Commerce Committee. It has a remarkably good record for picking up Labour’s legislation and turning it into something meaningful. I could illustrate that point with the bill about the drainlayers, plumbers, and electricians—
Gasfitters—that is the one. I think we have even had a Minister say the Commerce Committee changed that bill into something meaningful, and that was done mostly at the instigation of National members. So I say that the member should stand by, because we might be able to do something with this one, as well.
But what background are we operating against? Can we have confidence in this Minister’s administration? I really do not know. [Interruption] Did someone say no? Oh, Bob Clarkson did, and I think he is quite right.
Let us look at it. The energy policy is tied up with the shambolic climate change policy, resulting in uncertainty and investment delays. Why can people not pay their bills? I speak as someone who was brought up by a widow. Paying electricity bills was a big problem. We have seen the difficulty that can occur in a domestic situation. But—here we go—residential power prices have gone up by 48 percent in 5 years, from 2003 to 2007, compared with an increase of only 25 percent for industrial and commercial users. A further rise of 2.5c or 3c a kilowatt hour is required in order to deliver the steeply falling emissions profile that Labour’s Energy Strategy outlined, as a trade-off between security of supply and reduced emissions. That is stark.
The Energy Efficiency and Conservation Authority has had $110 million in funding since its inception in 2001, yet the 2006 review of its energy efficiency strategy of 2001 concluded that a 0.4 percent gain in efficiency was less than the gain of 0.7 percent when there was no strategy. This is the background we are looking at in terms of this legislation being introduced, and it is not a very satisfactory background.
Will the regulations work? The power, in this case, is being given to the Minister. In other words, it is something at the bottom of the cliff, because how will he know he should enact these regulations until it is too jolly late? Surely, the State-owned enterprises can be expected to provide monitoring and acceptance of these regulatory provisions on a voluntary basis and have it as part of their commercial practice. But that would not suit the profile of the present Government.
Let us look at the eligibility threshold for the domestic low-fixed charge. I would have to say, coming from the West Coast of the South Island, that the telephones have been running hot in my little blue office, with questions about why the West Coast has not been included in this strategy. Well, having had a look at it—having put the ruler across it—I guess that the West Coast should be delighted that it has not been included, because the strategy will not work, at the present rate. Indeed, I think the Minister is on record as saying he would speak to power companies and others to explain how it should work.
It would appear from the Minister’s spin that the scheme will address inequality, but let us remember that it does not talk about discounts or amounts; it talks about margins. Yet although lower-use consumers who have not yet signed up to the low-fixed charge scheme might get a slightly lower power bill—perhaps $20 a year—everyone else, including people who are already on the scheme, will probably pay more as the power companies simply raise tariffs across the board to make up the lost revenue. I understand that economists call this the “waterbed effect”. Meanwhile, residential power prices are up compared with the industrial ones, which have risen by only half as much. So people should be entitled to wonder what the hang is going on. Increasing the threshold for the lower South Island may not actually be needed, given this Government’s inaction over climate change, its mismanagement of deforestation, and the amount of carbon dioxide the State-owned enterprises power stations keep pumping out.
The industry is in a bad shape. It was interesting to attend, as one of its members, the Commerce Committee when questions were raised about Roy Hemmingway’s suitability. Roy Hemmingway addressed the committee. He talked about our limited reservoirs for electricity, about our limited capacity, and about the perilous state of the transmission lines. I understand that 75 percent of power transmitted to the upper half of the South Island, including the West Coast, is generated outside of the region and has to be pumped into the region, and that there is a 30 percent loss in transmission. That is frightful. Yet does this Government permit localisation of generation? Does it hang!
I got it from the power companies I deal with. They brought it to me as a complaint over the loss of transmission that occurs in the lines. If that figure is not correct, then I would like to hear from members opposite what the figure really is and just how good the transmission supply lines are. I think they will find that they are living, again, in a state of denial. Thank you, Mr Deputy Speaker.
PETER BROWN (Deputy Leader—NZ First) Link to this
Let me make it clear from the outset that New Zealand First supports the Electricity (Disconnection and Low Fixed Charges) Amendment Bill. The sad thing about it is that we have to have this bill at all. That is a sad indictment on this country.
Let me talk a little bit about the disconnection regulation. It is to underpin and ensure that the electricity companies actually do the job that is required of them. What happened in May with the Muliaga family was a disgrace—an absolute disgrace. I listened to the Labour speaker Maryan Street who said that she commended the companies for having the Jonah Lomu advertisement. Every time I see that ad I think of sadness and ask myself why we have to pay out this money to do something that is really just decent common sense: people who are on a life-support system do not get their power turned off. Everyone has a great love for Jonah and a great respect for him, not only for what he did on the rugby field but for what he has gone through in his private life.
Hon Mita RirinuiYes, he relied on it and he is a good man to use as an example, but we should not have had to use him. We should have contractors who, when they walk into a house and see someone on a life-support system, or even suspect that someone is on one, will say they will not turn off the power until they get the matter clear one way or another and check with their employers, or whoever gave them the contract. Now we are in the sad situation of having to produce legislation that will underpin the power companies to ensure they take a compassionate view and a compassionate attitude to this type of predicament. So New Zealand First has no hesitation in supporting this bill, for that reason alone.
The second area that the bill covers, the low fixed charge, also makes common sense. The threshold of 8,000 kilowatt-hours is not enough for the colder parts of New Zealand—people do not sign up to it. We need to increase the threshold, lower the line charge, and raise the charge per kilowatt-hour. At 9,000 kilowatt-hours it all balances even, and if people use less than that, they should make a saving. I do not know much that saving is—I think Gerry Brownlee alluded to it being $18—but the thing is, we have to deliver electricity to all people everywhere, particularly elderly people living in very cold areas, and we welcome this change. Whether it is enough, I do not know.
I have to say that I agree with Gerry Brownlee—and this is probably a little bit worrying—on his point that we do not generate enough electricity in this country. I think he is spot on. Something went wrong after the Bradford reforms. We were told at the time of the Bradford reforms that a competitive environment would get these generating companies competing, and that they would all have a surplus and the price would go down. But actually the reverse has happened; the generating companies produce just what they need—what they can sell, and at the price they can sell it—and the market price goes up as a result.
I have to say—and I know people will call me a heathen—that I would maximise our use of hydro power. They will not call me a heathen for that. I would maximise our use of wind power. I would maximise our use of tidal power. I would even look closely at wave power. The Minister of Energy will shudder now, but I would have a gas-fired power station in Ōtāhuhu tomorrow. Contact Energy would have a gas-fired power station in Ōtāhuhu tomorrow if it got the OK, and I would agree with it. I will go—I hope, if Genesis invites me—to the official opening of E3P, with glee.
I ask members to imagine the situation we would have if E3P had not occurred. This Government gave the go-ahead and underwrote the gas, and now “gas” is a dirty word. An even dirtier word is “coal”. It is an absolute dirty word. We have one coal-fired power station, and we have all the greenies kicking up here, there, and everywhere. China brings on stream three or four coal-fired power stations a month, and we say: “What about global warming? Close down Huntly!”. Or some people say that; I do not say it—I hope that the Huntly power station goes on forever.
I am moving into the subject of climate change and have digressed from the bill, but I know that the members opposite are learning and are finding this quite interesting. Let me say that if we want to solve climate change at a practical level—never mind that we introduce carbon tax or emissions trading schemes—we will have to address at a practical level the emissions that come from coal. Forty percent of the world’s energy is derived from coal. In Australia, 75 percent of energy is derived from coal. China, as I said, is producing a coal-fired power station every 10 or so days. If we want to change the climate, to change the carbon dioxide emissions or the carbon dioxide equivalents, we will have to address the coal problem on a global basis.
The Minister agrees. So I am against chastising and slagging off New Zealanders—as my Green Party colleague will stand up and do immediately after me in all probability—because we have one coal-fired power station delivering 1,000 megawatts. That is all we have.
I have digressed quite a lot on this bill. I want to see it go to select committee. I have read the bill, fairly quickly, a couple of times and I cannot see that it is in need of a great deal of amending; it seems to set out pretty clearly what it intends to do. I have no doubt that the select committee will give the bill a thorough examination and possibly find that a few adjustments are needed. But I hope, at the end of the day, and in reasonably fast order, that this bill comes back to the House and we can do something a little bit positive—although, if we had done the right thing in terms of the disconnection policy, we would not need a bill like this, and it is sort of sad to think about it.
But we do need the bill, and we do need to address the low fixed-charge rate and make it fairer all round for New Zealanders, certainly for those who live in the cold, and certainly for the elderly people who are living on fixed incomes in the cold. I shudder from time to time to think how they exist. When I was in Dunedin a few years back I met a few elderly people who told me stories of sitting in their beds all day wrapped up in blankets. There is an obligation on us to show a little compassion on the two fronts here. New Zealand First will support this bill.
TE URUROA FLAVELL (Māori Party—Waiariki) Link to this
Kia ora tātou. Kia ora tātou i tēnei Wiki o te Reo Māori. Tērā tētahi kōrero: “Mā te mea mātāmuri ka wehe atu i Aotearoa, e tinei te raiti?”. I ēnei wā, tērā pea ka kite tātau kua wetohia kē te raiti!
Kei te mārama mātau o te Pāti Māori mō ngā take i tae mai ai tēnei pire ki runga i te Pepa Rārangi Kōrero o te Whare, arā, nā te āhuatanga pōuri nei i pā ki a Folole Muliaga. Ko tōna matenga, nā te wetonga o te hiko i tōna whare mo te aha? Mō tana nama $168.40. Ki tā mātou mōhio koi nei te āhuatanga mō ngā tāngata e hia kē nei i Aotearoa. Nā te ripoata a te Manatū Whakahiato Ora o te tau 2006 i kī mai, hau tekau o ngā Pākehā me te hauwhā o te Māori, kāore i utu i tētahi o ā rātau nama hiko, korohū, wai ranei i te tau 2004. Hei tā te pūrongo, he taumaha ake tēnei āhuatanga mō ngā whānau Pasifika.
I te wiki kua taha ake nei kua rongo te Pāti Māori i ngā karanga pakanga nei e kī ana, mō ngā kaute kē te āhuatanga mahi tōrangapū. Kāti, ka pēhea ēnei whika? E 26.7 ō-rau o ngā whānau Māori katoa kāore i utu wawe i ā rātau nama hiko, wai, korohū i te tau 2004. Ā, e 12.7 ō-rau o ngā whānau i Aotearoa, arā, tata pea ki te 266,700 mano, kāore i utu i ō rātau nama mō te wā kotahi i te tau i mua. Ka taea pea e ngā tākuta whatiwhati kōrero te hanga momo whakautu mō te āhuatanga o ēnei kaute. Kei te tangata tonu rānei te tikanga ki te utu i āna nama i te wā e tika ana, ā, me āta titiro ngā kaituku hiko i ō rātau raupapa mahi, ā, me āta titiro rānei te iwi ki te āhua o wā rātau whakapau moni. Kāre he paku raru ki ēnei kārero, ā, he tika hoki ētahi engari, kua tau te hē ki wāhi kē, ko te Karauna tēnā e noho pai ana.
Engari, anei mātau o te Pāti Māori, te reo Māori motuhake, kei te Pāremata e akiaki nei i te Kāwanatanga mō ōna kawenga ki ngā nohoanga tāngata, ki te hapori, ki tēnei whenua hoki. I aro ake mātau ki ngā kōrero a te rangatira o Mighty River Power, a Doug Heffernan, me tana kī mai i te 25 o Pipiri, arā, “Ko ngā take rawakore he raru ka pā ki te nohoanga tāngata, ā, kei a tātau katoa te whakautu. He akiaki tonu tērā ki tēnā, ki tēnā, kaua ko ngā kamupene hiko anake engari, ko ngā tari āwhina tāngata me te Kāwanatanga hoki.”
Nā, ko te pire nei he tīmatanga kia uru mai te Kāwanatanga. Māku tonu e kī i te tuatahi, ka tautoko te Pāti Māori i tēnei pire nā te mea, he take tēnei ka pā mai ki te katoa mō ngā mahi weweto kaihoko hiko. Ki tā te Hāhi Salvation Army, nā te kaha o te mana o nga koporeihana, kāore ngā kaimahi i te tino ngākau nui i te hapori i runga i te ngākau atawhai. Ko tā Child Poverty Action Group, ko te pūtake o te raru, ko tērā e kī ana, “Kāore e taea e ngā kaupapa o te mākete te whakarite huarahi hei manaaki i ngā whānau.” He kaha ake te kupu o ngā Uniana me tā rātou kōrero i kī nei: “Kua kitea anō, ko te kaupapa nui o ngā koporeihana ā-Kāwanatanga, arā, ko te moni i mua noa atu i te tangata i Aotearoa nei.”
Nā te kaha takariri, koi nei tā rātou pānui i te 31 o Haratua ki a Mercury Energy: “He momo kaiwhakaweti tērā hunga, ko tā rātau kai ko te hunga rawakore, te hunga pōhara o Tāmaki ki te Tonga. He ōrite rātau ki ērā tāngata tuku moni, rātau he pirau te ngākau, ā, kei roto i ō tātau rohe e noho ana. Ka whakawhirinaki rātau ki te hunga mokemoke, ki te hunga noho manene.”
Ko te pire e wānangahia nei e tātou i tēnei rangi he whakaaro kotahi anake, ehara ko te titiro whānui ki te hiahia kia rere kē tonu ngā mea whai hua. Ko ngā whakatikatikatanga e whakaarohia nei mō te mahi tope hiko, mō te kore utu nama, arā, ngā momo huarahi hei utu i ngā nama i ngā wā ka kā anō te hiko, ā, mā te hunga raruraru, ka tautoko katoa mātau i aua kaupapa. Engari, kāore tēnei pire e muru i ngā taumahatanga whai hua o tēnei wā. Ko tōna tikanga, arā, ko te mahi a te Kāwanatanga he tiaki i ngā whānau kia taea ai e rātou nga whānau, te utu i ngā nama pēnei i ō rātau ake nama hiko.
Kei te mōhio tonu mātau kua whakaritea kē e te Komihana Hiko i te tau 2005 he kaupapa hei āwhina i ērā, arā, te hunga pōhara. Kua titiro mātau ki aua kaupapa, ā, he mea whakamīharo ērā hiahia hei āwhina i ērā e noho raruraru nei nā te kore mōhio. me pēhea e taea ai te utu i ō rātau nama hiko. Engari, ko te tino raruraru i whakatakotohia e te Perehitini o Grey Power, arā, e Graham Stairmand, nāna te Kāwanatanga i wero kia ngākaunui mai ki ērā kua piki atu te utu mō te hiko i te 60 ō-rau i ngā tau e whā ki muri.
Ka whakaatu a Child Poverty Action Group i te raru ki “ngā whānau he noho rawakore te noho”, i runga i te pātai: “Meinā ka aukatihia te hiko, ka pēhea ngā tamariki i ō rātau mahi ako i te kura, kia whāngaihia i ngā kai mahana, ki te mahi i wō rātau rorohiko, ki te horoi hoki i a rātau anō kia kore ai e mate i ngā mate tahumaero, me pēhea hoki?”. Ka hoki mai anō ki aua take anō kua piki te utu o te hiko, o te wai, o ngā waka, i runga ake i te ekenga o te wāriu, ā, i runga ake hoki i ngā utu mahi; kāre e ōrite te ngahoro o ngā painga ki ngā whānau katoa i raro i ngā painga o te kaupapa Mahi mō Ngā Whānau, ka riro i ētahi, ka noho pōhara tonu ētahi; he whānau tonu kāre i te whiwhi i ngā painga o te kaupapa Mahi mō ngā Whānau nā te kore mōhio kei reira tonu taua āwhina.
He whakaaro arorau ērā i roto i te pire e kī ana. me rere kē ngā utu mō ia rohe, mō ia rohe. Kua rongo nei mātau he tino whānui tonu te rere kētanga o te take mai i tētahi rohe o Aotearoa ki tētahi, ā, ko ngā take iti nei he moemoeā noa iho mō rātau e noho nei i ngā wāhi kaha mātao, kaha māku rānei nā reira, e whakaae ana mātau ki ngā rere kētanga kei te whakaarohia mō tēnā rohe, mō tēnā rohe. He whakaaro pai ērā.
Tērā pea ko te kaha o te riri, otirā, o te aroha ngā mea nui kua ngau nei i te ngākau o te motu. Ko tā mātau, arā noa atu ngā tino pātai hei tuku mō te āhua o te mana o ērā, arā, ko ngā kaiwhakarato nei mō te hiko ki te kore mahi i āna mahi nā te kore utu nama ahakoa, he mea waiwai tonu. Ko te ture e akiaki nei i ngā kaiwhakarato katoa, kia noho tika te mahi, ki tau te mahi, kia ora te mahi i a rātou e kimi nei i ngā nama, he ture tau ake kia waihangatia e tēnei Pāremata.
Kei te koa ki te kite e maumahara ana ngā tōrangapū tawhito ki ngā tino kaupapa, arā, kia haere te tangata i mua o te ture, ā, ka hangai taua kaupapa mō te painga mō tātau katoa o Aotearoa. Ko tā mātau wawata anō, ka titiro anō rātou ki ō rātou ake pōti, ā, me te kimi i te tika me te pono o te ngākau kia taea ai e rātou te kī tūturu nei, ko te ara ki ngā mahi tika, he tino kaupapa nui mō tēnei Pāremata. Nō reira huri noa, tēnā koutou, kia ora tātou katoa.
[An interpretation in English was given to the House.]
[Greetings to us all, in this Māori Language Week. There used to be a saying, "Would the last person to leave New Zealand switch off the light?”. In these times, we might instead find that the light was disconnected!
The Māori Party comes to the Electricity (Disconnection and Low Fixed Charges) Amendment Bill acutely aware of the dire circumstances that prompted this bill on to the Order Paper—the circumstances given focus through the tragic situation of Folole Muliaga and the fatal disconnection of power to her house because of an outstanding bill for $168.40, circumstances that we now know to be a common fact of life for far too many New Zealanders. The Ministry of Social Development’s Economic Standard of Living report, released in 2006, found that one-tenth of European families, and one-quarter of Māori families, fell behind on at least one bill for power, gas, or water in 2004. The situation was, and continues to be, worse for Pacific families.
The
But we of the Māori Party—a proud and independent Māori advocate in Parliament—are always happy to remind the Government of the responsibilities it has to consumers, to the community, and to the country. We were interested in a statement that Mighty River Power boss, Doug Heffernan, made on 25 June, when he said: “Financial hardship is a social problem and it requires a co
This bill, then, is the Government starting to play its part. From the outset, I say that the Māori Party will support this bill on the basis of shared concerns from across the nation about the disconnection practices of electricity retailers. The Salvation Army has suggested that the corporate environment is so influential that staff are discouraged from making decisions on humanitarian grounds. The Child Poverty Action Group
The bill we are considering today is but one part of a greater picture that reflects the need for economic changes to occur. The arrangements that are being mooted about disconnection following non-payment of accounts, about alternative payment options, about reconnection, and about identifying vulnerable consumers, are honourable proposals, and proposals we will support. But this bill does not take away the responsibility of addressing current economic realities. It is surely the duty of a responsible Government to ensure all whānau are able to meet basic costs such as electricity in the first place.
We know that there have been guidelines in place prepared by the Electricity Commission in 2005 to assist low-income domestic consumers. We have looked through those guidelines, and their intention to assist consumers whose income makes it genuinely difficult for them to pay their electricity bill is admirable. But the central problem lies in the facts outlined by Grey Power National President, Graham Stairmand, who challenged the Government to have some sympathy for consumers who have experienced a 60 percent increase in the cost of electricity over the last 4 years.
The Child Poverty Action Group also highlighted the “parlous existence of many low-income families”, asking the simple question: “How can children do their homework, get fed a hot nutritious meal, use the computer, or wash themselves adequately to prevent infections, when the power is cut off; how, indeed?”. Yet again, it comes back to the perennial problems that electricity, water, and transport price rises are well above the rate of inflation, and certainly well above most wage increases;
The other set of changes in this bill around the Low Fixed Charge tariff options seem to be logical, with the emphasis on being region-specific. We are told that there is wide disparity in the Low Fixed Charge tariff coverage in New Zealand; that the low-use threshold is unrealistic for many living in colder, wetter places; so the changes to recognise the different climates of New Zealand's different regions in the setting of tariffs seem sensible.
The moral and ethical outrage that has captured the compassion of the nation has focused perhaps too heavily on blame and shame. We believe there are very serious questions to be asked about how any utility provider has the power to withhold services on the basis of debts incurred—services that we would classify as essential. Legislation that reminds all utility providers of the need for consistent, safe processes in recovering overdue amounts is thus a very positive thing for this Parliament to bring in.
It is pleasing to see that the two older parties, in particular, are remembering the essential values of access to law and justice and to the application of the law for the benefit of all New Zealanders. We hope, too, that they may look further at their own voting record, and search their souls for the truth as to whether they can say, with all honesty, that they believe that access to justice is an essential principle of this Parliament. .]
JEANETTE FITZSIMONS (Co-Leader—Green) Link to this
The Greens will not be opposing this bill, because we see it as essentially harmless. I have to say, though, that we cannot muster a huge amount of enthusiasm for it, either.
Everyone, of course, was shocked at what happened to the Muliaga family and wants to make absolutely sure that a disconnection can never again cause the degree of distress experienced by that family. The matter is being dealt with largely through the guidelines of the Electricity Commission, which the companies are signing up to, and of course we support a back-up power to regulate if the companies ignore those guidelines. But I think the retailers have pretty much learnt their lesson by now from the huge public outcry at what happened. I cannot imagine that that incident is going to be repeated. Nevertheless we do support a power to regulate, just in case.
Clause 4, however, is a very minor tweaking of a largely ineffective existing law. I think we ought to be bolder and start asking why just one industry out of the very many that have high fixed costs is able to charge fixed prices before it charges for use. If I drive on to a petrol station forecourt, I do not have to go through a barrier and put in $20 before I get to the pump and buy my petrol at 50c a litre. A petrol station has very high fixed costs, including storage of fuel, the checkout counter, the building, and the bowsers, and it would be in serious trouble if everybody who came in bought only 50c worth of petrol and went out again. But petrol stations do not have the right to charge a fixed entry cost. A supermarket has very high fixed costs too, but when we get to the checkout it does not say: “OK, that’s $20 for coming in the supermarket door and now you get a discount off all your groceries.” So why is the electricity industry any different?
In the electricity industry we pay a substantial part of our power bill just to be connected to the lines. A lot of people mistakenly call it a line charge. They think it is the lines companies that charge the fixed bit of the tariff, and the retail companies that charge the variable bit. But that is not true. The lines companies charge quite a lot of their return on a variable basis, and the retail companies charge a fixed charge for metering and billing. When did we ever have to pay a fixed cost for having our meters read before we bought any electricity?
The Green Party has always had a policy that there should be no fixed charges, and that fixed costs for companies should be recovered out of the unit charges. That would mean that unit charges would be higher, and the price of electricity at the margin would higher, but it would mean that using less would become cheaper. For example, it would mean that the return people got on insulating their houses, or on installing a solar water heater, or by just turning off dripping taps would be very much higher than it is now. Most people who save half of their electricity use, save only about one-quarter of their bill, and that is not a very good incentive. Getting rid of fixed charges used to be Labour’s policy, as well, but that somehow went by the board.
In 2001 I spent a lot of time discussing with the then Minister of Energy, the Hon Pete Hodgson, the 2001 electricity legislation where Labour sought our support. I argued very hard for zero fixed charges. The best the Minister would offer as a compromise was the low fixed charge for those consumers who used less than half the average amount of electricity, because their bills would then go down without the bills of higher consumers going up. That compromise has not been particularly effective. Power companies have all kinds of ways of disguising the fact that optional low fixed-charge tariffs exist, and because it applies only to some consumers, the benefits of it are actually pretty small for most people.
This bill tweaks this situation a little bit further, and it is the only legislative outcome of the 2006 Ministry of Economic Development study called Pricing in the New Zealand Electricity Market and its Economic Impact. That study found that electricity needed to be priced at marginal cost to prevent shortages and subsidies, and to encourage efficiency, but if all electricity was priced at this level—as it is now—it would be unaffordable for some, and it would make huge windfall profits for generators, which it currently does.
The report concluded that there were three ways of addressing this problem, but it recommended against all of them. The most sensible way to address the problem is through progressive pricing, where all households have a basic block of power at a low price per unit, and the price per unit rises with each block of power used above that. The power company receives the same total revenue, but basic needs are affordable. People do not get into the situation in which the Muliaga family found itself in respect to their power bill, but everybody has an incentive to conserve, because the last unit that people are using always costs more than the average that they are paying. However, this report advised against that because it was not consistent with the ideology of competitive market arrangements.
Instead, the Minister proposed to Cabinet that it tweak the optional low fixed charge in the South Island to recognise that the average use in the South Island is higher. That is not a bad thing to do; it will do no harm, and it might do a tiny amount of good, but it is actually hardly worth the legislative time that it is taking. It is a huge missed opportunity to price electricity in a way that would ensure that everyone could afford to meet his or her basic needs, but would face a higher cost at the margin and have an incentive to use electricity wisely.
JO GOODHEW (National—Aoraki) Link to this
I rise to take a call on the Electricity (Disconnection and Low Fixed Charges) Amendment Bill. The National Party supports this bill going to the select committee. The previous speaker, Jeanette Fitzsimons, mentioned that this bill is perhaps harmless. I have to say, straight up, that if one reads the Timaru Herald, one would think that some parts of it are not only harmless but also useless. But I digress.
I will start by saying that there are, of course, two parts to this bill: the disconnection of electricity for domestic consumers and the regulation-making powers relating to that, and the low fixed-charge tariff options for domestic consumers. I want to start by talking about the first part, the disconnection of electricity for domestic consumers. In this day and age we have become very, very reliant on our electricity. We do not like being cold.