Hon TREVOR MALLARD (Minister for State Owned Enterprises) Link to this
It is important that we focus, just for a short time, on Part 1, because I think members will want to know that the interpretation clause is very standard around animal material and animal products, as with the Animal Products Act 1999. The board is not the board of Asure but that of AgriQuality Ltd, and the official assurances are, again, those as given in the Animal Products Act.
The shareholding Ministers will be the shareholding Ministers of AgriQuality Ltd, as opposed to those of Asure, although in the current circumstances they are the same Ministers—the Minister of Finance and the Minister of the Crown who is from time to time responsible for AgriQuality Ltd. It has been the practice of previous Governments to have the Minister for State Owned Enterprises as the responsible Minister, though I think it is fair to say that on occasions there have been debates around whether it is appropriate to have, as with the Animal Health Board or with Learning Media, different responsible Ministers, and whether that Minister should be the Minister of Agriculture. The previous Government and this Government have taken decisions that having the State-owned enterprises, as far as is practicable, put together for these purposes is the right approach.
Clause 4 provides that the Act will bind the Crown—it is the clause that causes the Act to bind the Crown. Clearly, that is an important provision for this bill. There are important Crown powers and Crown responsibilities within this Act of Parliament, and it is therefore important for the Act to bind the Crown.
Without getting on to too much of the substance of the bill, I say that the bill has been pretty fiercely contested, and I am absolutely certain that the National Party will vote against even the interpretation clause—with not much point in doing so. But I think that section has gone through a thorough but intensive—
Hon TREVOR MALLARD Link to this
Well, I was going to say there is nothing wrong with being a bit quick. In this circumstance, working pretty hard, getting some work done, doing a little bit of overtime, getting up before half past 8 in the morning, hearing some submissions, balancing them out, and coming out with an opinion on Part 1 is something that does not harm select committees. For select committees to work a little bit more than maybe some National Party members are used to doing—working in the mornings as well as in the afternoons—is something that I know is foreign to Mr Guy and some of his colleagues, especially some of his colleagues who have been involved in this select committee. But that is something they have to—
Hon TREVOR MALLARD Link to this
No, I think it is true. Mr Brownlee is hardly a bundle of energy in the morning, is he? However, I did notice—and excuse the diversion, Mr Chairperson—that he seemed to be enjoying his work in the Commerce Committee a little bit more recently than he has done in the past.
Darren HughesHon TREVOR MALLARD Link to this
With the Major Events Management Bill. I do not think I have ever seen a photo of a chair of a select committee in the Dominion Post with his tongue hung further out than Mr Brownlee’s was—
Hon Clayton CosgroveHon TREVOR MALLARD Link to this
Well, I think Bellamy’s and the Dominion Post are kind; they do not entertain us with photos of Mr Brownlee eating, but they did entertain us with a photo of Mr Brownlee, as chair of the Commerce Committee, drooling.
The CHAIRPERSONHon TREVOR MALLARD Link to this
In moving back to the bill, I say that I do not think anyone could possibly drool over the interpretation section of this bill. It is a relatively standard, run-of-the-mill, animal products - type interpretation. Again, I would find it hard if the National Party chose to vote against the fact that the bill binds the Crown.
NATHAN GUY (National) Link to this
I wish to take a call on Part 1, “Preliminary provisions”, of the State-Owned Enterprises (AgriQuality Limited and Asure New Zealand Limited) Bill. The National Party has some concerns about the bill. It was interesting to hear the Minister try to wind into us and say it was great to work hard on select committees. He said the Opposition members are a bit of a lazy lot on the Commerce Committee. I do not think that is fair. National has a concern that there has been a bit of a mad rush with this bill, and I look forward to hearing the Minister explain why the Commerce Committee had to rush it through.
In terms of clause 3, “Interpretation”, it is important to realise that New Zealand’s processing plants have very, very high-quality standards, particularly with regard to animal products and animal material, which are defined in this clause. Mr Locke will know that from being, I think, a former meat inspector.
The National Party has a concern that if this bill goes through, it will reduce competition and that will drive up the cost at the farm gate—it will drive up the cost for the purchaser at supermarkets and butchers shops. That is why National has concerns, overall. I look forward to the Minister taking a call and letting us know why the bill was rushed through in this fashion.
—under Part 2, which is really the meat of this bill, I know—[ Interruption] I hope Mr Mallard can take a call and let us know why we had to rush this bill through the select committee.
The main thing under Part 1 is that this bill will raise some big concerns for people who are producing the animal material and the animal products. I am talking about farmers, because they are up in arms about this legislation, and particularly about how it will affect their costs, which will go up.
PANSY WONG (National) Link to this
It is very strange to hear the Minister in the chair, the Hon Trevor Mallard, filibustering on Part 1 of the State-Owned Enterprises (AgriQuality Limited and Asure New Zealand Limited) Bill, which is entitled “Preliminary provisions”. I was looking forward to his passionately explaining to us the significance of the definition “ ‘animal material’ has the same meaning as in section 4(1) of the Animal products Act 1999.” Was there some secret agenda to change that definition in the legislation?
I think the definitions in the interpretation clause are very important. I particularly want to talk about the definition of “Board”. The bill states in clause 3 that “ ‘Board’ means the board of directors of AgriQuality Limited”. Speaking as one from a commercial background, I know that usually when a board of directors is set up the shareholders give the board a lot of discretion to administer the affairs of the company. In an AGM situation shareholders indicate whether they are happy with the board emailing a range of strategic directions and a forecast. Usually shareholders expect a dividend rate, and if they are not happy it is quite obvious and they sell their shares.
But when the Government owns a company, the authority of the board takes on a slightly different shape. Usually, when a competent Government sets up a company it will give quite clear directions and expectations about what it wants the board to achieve. Then the directors will be left to chart their own course, as long as they can deliver those directions and expectations, which generally are set right out before the beginning of each year.
That is what I think is really important. I am not too sure how the directors of the board of AgriQuality Ltd will feel after the passage of this legislation, because Part 2, which we will be voting on shortly, consists of many clauses that state what the shareholding Ministers can dictate to the directors. They can write to them and give them instructions. In effect, when we get to the crux of it—and National members cannot wait to get to Part 2—it seems that the task of these directors will indeed be very difficult. The directions from the shareholding Ministers may sometimes put the directors almost in a position beyond where their standards of professional conduct might want to take them. Therefore, I have a lot of sympathy for the position that existing, and potential, directors of AgriQuality Ltd may find themselves in. They will realise that their independence and professional expertise may be compromised by the passage of this legislation, because Part 2 provides for the shareholding Ministers to have a lot of power to give directions to them.
I was told by my caucus colleagues who are familiar with the rural sector, like our very hard-working, excellent junior whip, Nathan Guy—the future member for Otakiand one of our very good members—that the existing directors of AgriQuality Ltd and Asure New Zealand Ltd are doing a good job. Mr Guy told me that they are doing a great job. They are competing with each other. They have broad directions given to them from the shareholding Ministers, and they have the independence to do their best to serve these companies. Why are we doing this to them?
KATE WILKINSON (National) Link to this
I am absolutely delighted to rise to take a call on this bill—
Jill PettisI am actually grateful, I say to Mrs Pettis, that it has a long title, which is the State-Owned Enterprises (AgriQuality Limited and Asure New Zealand Limited) Bill.
Yes, I appreciate that we are doing Part 1.
In relation to Part 1 I particularly want to talk about clause 4, because I think clause 4 is quite a telling clause. I know that it is simple and that it states: “This Act binds the Crown.”, but, as any student of law would know, one of the first sections one goes to, when attempting to read legislation that has been passed by this House, is the section stating whether the Crown is bound by the legislation. So that clause is very important.
The second most important section is usually the interpretation clause, because again one needs to know whether the Act is applicable.
In relation to the Act binding the Crown, we have to go back to what the purpose of this legislation is—that is, to reduce competition. The explanatory note of the bill states that the Government wishes to prevent this competition from occurring. So we can understand why this particular Government wants the Crown to be bound by this legislation.