Estimates Debate

The CHAIRPERSON (Ann Hartley) Link to this

The House is in Committee on the Appropriation (2007/08 Estimates) Bill. The Standing Orders provide for 8 hours of debate on the estimates. Each member may have no more than two speeches of 5 minutes on each vote. The estimates debate should be relevant to the Government’s current spending plans, as contained in the Estimates of Appropriations.

As each vote is reached, a question will be put that the vote stand part. If it is the wish of the Committee, I will put the question on groups of votes by Minister until a vote is reached that members seek to debate. A separate question on this vote will then be proposed from the Chair. Should it be the wish of the Committee, a question may be proposed on two or more related votes for the purpose of debating them together. At the conclusion of the 8-hour debate, any remaining votes and the remaining provisions of the bill will be put as one question.

The Government indicates which votes are available for debate. I understand that all votes are available in order of seniority of Ministers, commencing with the Speaker’s votes. Copies of the order of votes to be considered are available at the Table.

KEITH LOCKE (Green) Link to this

On Monday of last week the Inspector-General of Intelligence and Security began a hearing on the security risk certificate applied to Ahmed Zaoui way back in March 2003. It has taken well over 4 years for this hearing to begin, which is a great injustice, and I think it is largely the result of the incompetence of the Security Intelligence Service, which is the vote being discussed under this point, and the delaying tactics by that service. It is so unfortunate that Mr Zaoui is being used as a guinea pig for the security risk certificate provision of the immigration legislation, which even the Government admits is flawed and will be reviewed.

Mr Zaoui has been separated from his wife and family for 4½ years because of this delay. When the hearing began, the Prime Minister commented that it was a hearing, not a trial, and justified the secrecy around the hearing. I think that what the Prime Minister said ran contrary to what has been said by the various courts that have had hearings on the Zaoui case over the last few years. They were quite clear that full and proper standards of judicial process had to be applied to Mr Zaoui’s case, and there had to be a high standard of proof that he was really a threat to the security of New Zealand for the security risk certificate to be upheld by the Inspector-General.

In relation to the estimates, there has been a huge wastage of Security Intelligence Service resources on this whole case. Mr Zaoui has been out on bail for 2 years or so now, and he is clearly not a risk to the security of New Zealand. He has been giving lectures at universities, and is well respected as a proponent of women’s rights and of peaceful dialogue and reconciliation between the Muslim world and the West. In fact, he is probably New Zealand’s main expert on this issue, and he is recognised as such by many in academia. To think he is some sort of bomb-thrower is very strange.

One of the problems with due process in this whole question is the secrecy that has been put around the trial. It does not apply to any other judicial proceedings where the material being considered is open material. The whole first stage of the hearing being conducted by the Inspector-General last week and this week is on non-classified information—all information that at any proper judicial hearing should be open to the media and the public so we can see that justice is being done. The second stage of the hearing has another element of injustice to it, in that it will not involve Mr Zaoui and his lawyers at all; it will involve the special advocates, Stuart Grieve and Chris Morris, who have been appointed not by Zaoui and his legal team but by the Inspector-General himself and who are ultimately responsible to the Inspector-General, not Mr Zaoui. Also, once they have seen classified material in the Zaoui case their instructions are not to speak to Mr Zaoui or his legal team about it. So Mr Zaoui will know nothing of that classified information, and that is not the way an accountable justice system should work.

This is one of the issues that the Greens have expressed over the years. The problem of having a Security Intelligence Service separate from the police is that the intelligence services are much less accountable to Parliament and to the people, and they can do many wrongs behind those closed doors, whereas the police have a much more accountable system. That was an additional concern for us just a few days ago when the head of the Security Intelligence Service, Warren Tucker, said that the Security Intelligence Service would like to branch out into the issue of international criminal activity beyond the normal political dimension of the service’s work. That, to me, would create problems on two levels. One is that the work being done in the area of international crime at the moment by the police—and it is very good work; and they have all the international communications and links—is accountable through the reporting system of the police. It would not be if it were done by the Security Intelligence Service.

The accountability problem exists for the Security Intelligence Service more than for the police; also, if we had this overlap between the Security Intelligence Service and the police in international criminal activities, then in a sense the left hand would not know what the right hand was doing because two different institutions would be operating. The problem is that the Security Intelligence Service is just so secretive. In the 50 years it has existed it has not deposited any material with the New Zealand Archive. In fact, in 2005 there was another 10-year deferral of material. This secrecy contrasts with that of a partner agency in America called the Central Intelligence Agency, which is much more open. Just recently it deposited extensive files back to the period of the 1970s, even detailing assassination plots against Fidel Castro, etc., etc. The director of the Central Intelligence Agency was very open, saying that it is important that the public know some of these things so that Americans can learn from the mistakes made in the past. That does not seem to apply to this Government or to the Security Intelligence Service in that there is still such a wall of secrecy around all the Security Intelligence Service’s activities over the years. I am sure that we have much to learn.

In respect of the material the American Central Intelligence Service has come out with, I am sure there are some parallels with the New Zealand Security Intelligence Service during that same period that should also be brought to light. I am not suggesting there were any assassination plots, but other things disclosed in those 1970s US intelligence service materials—such as that they were spying on the anti - Viet Nam War movement, etc—were likely to have taken place in New Zealand, as well.

I think the other parallel is that these crimes—one could say—of the Central Intelligence Agency at that time were justified in terms of the Cold War. Today it is not the Cold War but the so-called war on terror that is used to justify all kinds of heavy-handed, often illegal, and repressive actions. We saw this yesterday in Australia when the Australian Government defied, very frontally, a judge in Australia who let Mohamed Haneef, a doctor accused of giving a SIM card to some British terrorists, out on bail. He was immediately put into a detention centre by the Government in complete defiance of the judge. The Government used the excuse that it was cancelling his visa and could put him in an immigration detention centre. So that is just an illustration of executive power against judicial power, which is the problem, I think, that bedevils the Ahmed Zaoui case as well. Through the security risk certificate procedure, it is ultimately an exercise of executive power over fair judicial power.

One of the things that most concerns me about the Zaoui case—and the Government will often say it is just going through the processes, etc., etc.—is that by the Government’s action the most virulent anti-immigration, anti-Muslim sentiments against Zaoui have been unleashed, which one can hear on talkback radio regularly. The Government might say that it would never say things as extreme as that, but by its treatment of Mr Zaoui over these years it has given the green light to that element of society to come out with those reactionary sentiments—at great cost, I think, to the liberal character of our society. I just hope that the Inspector-General, despite the deficiencies in the process that has been launched, does in the end come up with a just and humane decision.

I think one of the inhumanities of the Zaoui case is the Government saying it will not let Zaoui’s wife and family come here even for the duration of the hearing. That is inhumane, and I think is understood as such by many people in this country. Humanity should be the basis of any good Government. Zaoui’s wife and his family are being penalised. They have been separated from Mr Zaoui for 4½ years, through no fault of their own. Their only guilt is to be part of a refugee family and to be the wife and kids of Ahmed Zaoui, a man hounded from Algeria. I have seen the torture marks on him. This is a person who is a legitimate refugee, determined as such by the Refugee Status Appeals Authority. He has been mistreated around the world and tortured by the Algerian authorities, and this is his treatment

Hon Dr MICHAEL CULLEN (Acting Minister in charge of the NZ Security Intelligence Service) Link to this

I would like to respond to the member Keith Locke on a number of matters and perhaps inject a small element of fact into some of the assertions we have heard on this matter.

First of all, I deal with the issue of the archives. In fact, the member is wrong. Already some declassified documents have now been deposited with Archives New Zealand. The reason for the long delays is that working through what can be declassified is, of course, a much more difficult process for intelligence archives than for almost any other set of archives the Government has. It requires consultation with intelligence partners and takes a very, very long period of time. Initially, resources simply were not available to engage in that activity compared with the primary role of the Security Intelligence Service. Resources have now been directed to this work and the Security Intelligence Service is actively engaged with Archives New Zealand on appraisal of the service holdings, and we can expect that more information will be transferred into the archives. As the only non-archivist life member of the Archives and Records Association, let me say that I warmly welcome that fact.

Let me come to a couple of the other points made by the member. He lit upon the fact that the Security Intelligence Service is separate from the police. I was not clear whether that was supposedly a good thing or a bad thing. It seems to me to be an essential thing. It is absolutely essential that the workings of the New Zealand Police are separate from the workings of the external intelligence agency and the internal intelligence agencies—the Government Communications Security Bureau and the Security Intelligence Service—partly because of the nature of the information they have to deal with. Indeed, the director of the Security Intelligence Service referred to a potential role in crime for the service. The Government has made no decisions and has not even considered that matter, but the reality is that there is an increasing interpenetration in trans-national crime with terrorist activities. This is why the director of the Security Intelligence Service has drawn attention to the potential role of the Security Intelligence Service in that regard.

In respect of Mr Zaoui, I note that the member is utterly convinced of what the outcome should be. I place some faith in the process and do not prejudge the outcomes in that regard. Obviously, the member considers that he has more information about security matters than any other member of the House. I doubt that is true. It is a matter for the Inspector-General to determine finally whether the security risk certificate was properly issued. The member objects to the fact that counsel for Mr Zaoui are appointed by the Inspector-General and, effectively, sworn to secrecy on certain matters. That is because to do the job they have to have access to the Security Intelligence Service records. Those are not records that should be put in the public arena just so everybody who rings up talkback radio can decide whether they got it right or wrong in terms of their initial prejudices on these matters. These are classified security intelligence matters and should remain within that kind of purview, right or wrong in their judgments, rather than being released into the public arena.

I must say, I do find it strange that so many on the left regard Mr Zaoui as some kind of untrammelled, spotless hero. He separated from his wife and his children because he chose to do so. He left them and came to this country. He left them and came to this country on a false passport. He left them and came to this country on a false passport, which he destroyed. At that point, of course, it made it easier for him not to be immediately returned to some other place, because he had no legitimate travel documents. His case has been considered by other tribunals in similar countries and he has been found to be somewhat wanting, if I can put it that way, in those respects.

But in respect of the matter of the basis for the security risk certificate, that is a matter for the Inspector-General to determine, not a matter for any member of this House individually, or for the House collectively, to determine, and the Government will abide by that decision. It would be interesting to know whether Mr Locke would make the same undertaking should the decision go against the view he holds on this matter. I might say on that matter, as well, that the delays are very largely the product of the legal counsel who have been engaged by Mr Zaoui and are working on his behalf.

Hon BILL ENGLISH (Deputy Leader—National) Link to this

It would be useful if the Minister of Finance could answer one question arising from the Treasury annual report. There is quite a focus in there on Treasury being designated as a problem solver in the public service. One cannot help but read Treasury’s description of what the Minister wants it to do and think that he has lost faith in the rest of the civil service, and that the Government is becoming frustrated because the civil service will not produce the solutions that an ageing and a tired Government wants to see in order to make it feel as though it is getting somewhere. Its response to that is—oddly and ironically for Labour—to designate Treasury as the lead solution agency. Well, I would like to hear from Dr Cullen as to why that is.

Dr Cullen will probably get up and say that the Government wants Treasury to find solutions. Well, the reason Treasury is having trouble finding solutions for Dr Cullen is that he has created so much confusion and complexity for himself in his economic management. Let us look at the attempt over the last 6 or 8 months to try to absolve the Labour Government from any responsibility for the highest interest rates in the developed world and a record exchange rate. It started about 8 months ago, I think—I cannot remember exactly how many months ago—when Dr Cullen started to say that we needed other tools to assist monetary policy to belt a rising housing market. With some disappointment, I noted that the Governor of the Reserve Bank appeared to use the same kind of rhetoric. The Reserve Bank is independent and should be at arm’s length from the Minister, but between the two of them they have now managed to sow a paddock of confusion about what the Reserve Bank is focused on, and about what Dr Cullen thinks are the actions that a sensible and well-managed Government could take regarding the economy.

Dr Cullen needs to understand that many New Zealanders are not fooled by the elegant crafting of his own words. They have seen the sideshows of the last 6 months for what they are: the result of a Government that now faces the accumulated results of its economic management since it has been in office. Those results are not pretty for the economy and they are certainly not pretty for voters, which explains Dr Cullen’s particular anxiety to make sure that he is not labelled with any responsibility whatsoever for them. However, that appears to be not working, because it is now common gossip, coming not out of the National Party but out of the Labour Party, that Labour is wrestling with the trade-off of whether to get rid of him.

Should Labour keep Dr Cullen because he is the only competent Minister left on the front bench? I agree that he is. Compared with Steve Maharey, who we hear has got the job of vice-chancellor of Massey University—and if he has not got it, he is certainly trying very hard to get it—and the rest of them, Dr Cullen certainly is competent. So should Labour keep him because he is the one person the public believes can at least get to grips with an issue and has not completely lost it, or should it get rid of him because he represents political death for Labour every time he gets in the media? Every time Dr Cullen gets in the media, it reminds people that the Government thinks it can use their money better than they can, and that 7 years of Labour has led to the highest interest rates in the developed world. Not only are they the highest interest rates but they will stay the highest rates for longer; there is to be no relief before the end of 2008. I see today that a number of economists are picking that the situation will get worse, and I think the member for Waimakariri knows what that is doing to his majority out there in the suburbs.

We have the highest interest rates in the developed world and a Minister who believes he has had absolutely nothing to do with them. That is the credibility gap. Every time Dr Cullen claims that the Government’s decisions over the last 7 years have had absolutely nothing to do with the highest interest rates in the developed world, no one believes him.

Hon Dr MICHAEL CULLEN (Minister of Finance) Link to this

I just want to touch on one simple point for the benefit of the member: I have just done a little count here. I have been elected five times as the deputy leader of the Labour Party. I have been unopposed on every occasion. The member who has just been speaking briefly flew through the stratosphere as leader of the National Party, and was dumped humiliatingly—

CHRIS TREMAIN (National—Napier) Link to this

I think we will get off Dr Cullen’s personal cloud there and come down to some of the details of the appropriations spending. What I want to focus on today for members of the public is some $41 million that is sought in advice from Treasury in three key areas—$13.32 million on economic performance policy advice, $17.59 million on State sector performance policy advice, and $11.439 million on macroeconomic policy advice, all of which are increased appropriations that the Minister of Finance has requested in this estimate. I want the public of New Zealand to understand the level of advice that has been appropriated in these estimates—whether that is good value for money, whether the Minister of Finance is using $41 million worth of advice as good value, or whether he is choosing to run his own path completely in other directions from where Treasury is recommending.

Just as an aside before I get into the detail of that, members of the public should know that this estimate equates to a total of $5.643 billion in spending. Of that, $2.1 billion is in borrowing expenses, $2.4 billion is in capital expenditure, and there is another odd billion there for other expenses. But there is $56.53 million in departmental output expenses. Of that amount, $41 million is in three key areas of advice.

One would hope that the $41 million investment in those three key areas of advice would be focused on taking the country forward. Those three key areas, which should have the aim of really driving the country forward, are, firstly, improving New Zealand’s economic performance, $13.32 million; secondly, improving the performance of our State sector, $17.59 million; and, thirdly, improving macroeconomic policy, at $11.439 million.

Let us start with improving New Zealand’s economic performance. We will all remember the much-vaunted call by Dr Cullen in his 2001 Budget speech to lift New Zealand’s economic efforts, comparative to other OECD countries, to the top half of the OECD. What have we achieved, despite a significant level of advice over the years? In fact, we have dropped down the ladder in terms of economic performance. Unfortunately, the positive moves in the Budget, especially on company tax, are overshadowed by the absence of a strategic direction and of effective policies to lift our economy’s sagging growth rate.

If we go back to 2001, the sustainable projected growth rate was estimated by the Minister of Finance to be 4 percent. As we look forward in this set of estimates and the Budget for this year, we have been averaging a GDP growth rate of 2.5 percent. This is below the growth rates of our key financial partners like Australia, and certainly below the growth rates of the early 2000s and the late 1990s. Unfortunately, on present policy settings, the income gaps between ourselves and Australia will continue to increase. So I say to members of the public that we have to ask ourselves whether the $13.32 million that has been appropriated here is good expenditure and whether we have had good advice that has been well heeded.

The improvement of State sector performance is a very relevant point. The Minister has requested $17.59 million in policy advice from Treasury. It is not just a small amount; it is $17.59 million. We ask ourselves whether we are getting good value for money in that. Achieving improvement in State sector performance is about getting more outputs from the inputs into the State sector. What we see there is excessive and wasteful Government spending, up by a massive $3.8 billion over the next financial year. We also see that cost increases from regulation will continue to go up, stifling productivity growth, conflicting with monetary policy, and certainly damaging the export sector.

SHANE JONES (Labour) Link to this

Aotearoa, please wake up! What we heard from Chris Tremain was a speech that started with some promise but got lost in labyrinths of figures that were beyond the capacity of that speaker, who is really more interested in apples, sunshine, and the likelihood of an earthquake striking Hawke’s Bay.

Of course, the earthquake—emotional—is actually striking National. While Labour members were out toiling in the field, working amongst our electors, the earthbound—or sheep-dipped—Mr English of Dipton was reminding the people of New Zealand both that he was parsimonious. He would not allow the confidence and reassurance that old people and people of the middle-aged sector are beginning to feel, as a consequence of our Budget, to take root. Mr English chooses to make fun of his own leader in the media at every opportunity when he speaks publicly. He harbours ongoing, unrequited desires to actually be the leader one day. Fortunately for the country, that day will never come to pass as there is a new group of people. Although that was a lacklustre speech from the member from Hawke’s Bay, Chris Tremain, the man may very well emulate the feats of his father and rise to great heights in the National Party.

Anyhow, let us talk about what we are actually delivering in this Budget. KiwiSaver does two things. First, it is an overdue contribution to strengthening the capital markets of New Zealand at a time when we suffer the depredations of our friends in Australia. Mr English and Mr Key take every available opportunity to scare people away, telling them Australia is so much better, and showing an absence of patriotism, whilst at the same time promising to have a remedy better than that of our side of the House. But what really puzzles us is why Mr English has chosen, at a time when National has absolutely no policy—it fears to crystallise any of its thinking as to what its policies will be—to remind everyone National is not to be trusted in the area of superannuation.

Thank goodness for Dr Cullen’s stewardship of our Budget. We have continued to maintain surpluses. In addition, we have a net positive situation in relation to debt. Of course, that will disappear if Mr Key has the opportunity to turn into reality his unfolding and drivelling rhetoric. Any time two dogs, five women, and three cats are to be found together, they are forced to listen to Mr Key talking about how the economy is under-leveraged. This man wanders around talking to rat catchers and various other characters from local government—who ought to stop meeting with him and attacking the Government, and go home and deal with the floods in Northland—and he continues to tell them they need to go out and raise debt. So the situation we have created, which is now a model of great pride and some envy throughout the world, with moderate levels of debt, would be overturned if Mr Key had his way.

But, of course, at the same time, he is reminded by Dr Smith—Dr Lockwood Smith; anything he is reminded of by Nick Smith he should immediately forget and put into the dust heap of history—that additional expenditure will not help the situation, because we have productivity constraints. There is not a single thing to be heard from either of those two men as to how productivity constraints might be dealt with, which is what we do in this Budget with our ongoing investment in making business more efficient, reducing the tax burden, and improving the opportunities for research and capital development. That is what productivity problems require in terms of a remedy.

So local government, regional government, and central government will all suffer high levels of debt if Mr Key has his way. Fortunately the sheep-dipped, earthbound Mr English will probably prevent that from happening. I must confess that when I hear Mr English speak about economics I am reminded of my padre’s story about the Munchkins from Kansas. His type of economics is small, it is insular, and it defies reality, because at one level he will not moderate the spending ambitions of his colleagues, whilst Mr Key wanders around promoting—[Interruption] Yes, that is a brilliant analogy. I salute the clever Dr Cullen for reminding the country—

CRAIG FOSS (National—Tukituki) Link to this

Following the previous speaker, who is earning his new nickname—I believe it is “Parekura Lite”—as he seeks to fulfil his ambitions, I will speak to Vote Finance, but maybe this speech is more about a vote of no confidence in the Minister of Finance.

Towards the end of his speech earlier, the Minister of Finance had a go at someone for wanting to borrow money overseas to fund tax cuts. Actually, Dr Cullen also borrows overseas, because many of the holders of his bonds, treasury bills, etc., are owned overseas. So, in fact, Michael Cullen borrows from overseas in order to fund the various votes. Does he borrow to fund tax cuts and various distributions? Yes, he does. In recently answering a written question in which I asked him whether the funding from the various borrowing and bond programmes was allocated to specific budgets or specific votes, he said that, no, it was not, and that it essentially just went into the queue at Treasury. So we do not know what happens to the money that Dr Cullen borrows from overseas, but, quite frankly, it could be used to fund tax cuts.

Dr Cullen’s obituary is being written as we speak. We have heard it earlier. He endlessly puts out spin. We have just recently seen some taxpayer-funded advertisements about the various policy packages of 1 July that Labour brought out in the recent Budget. Let us look at what will be on Dr Cullen’s tombstone.

In 1999, when Dr Cullen became Minister of Finance, the official cash rate was around 4.5 or 4.75 percent. In 2007, Export Year, that rate is 8 percent and is going higher, according to the analysis of only today—almost double the 1999 rate. When Dr Cullen became Minister of Finance, the current account deficit was about 3 percent, and he predicted it would go down to 2 percent. In fact, today it is about 8.5 percent. As Dr Cullen alluded to in question time today, when he became Minister of Finance the Kiwi dollar was valued at around US40c. I think he said it went down to US38c. In this year, Export Year, the Kiwi dollar is at nearly US80c, and, again, it is predicted to go higher than that. What a disgraceful legacy that is, after 7 years of a commodity boom.

When Dr Cullen became Minister of Finance in 1999, the highest tax rate was 33 percent. It is now 39 percent. At that time he also said that only 5 percent of taxpayers would be in that bracket. Currently, around 12 to 14 percent of taxpayers are in that bracket.

Home affordability, when Dr Cullen became Minister of Finance in 1999, was at around 4½ times average earnings. Today it is 7½ times average earnings. New Zealanders are unable to even aspire to own their first homes now, let alone to fund any type of mortgage.

When Dr Cullen became Minister of Finance, the proportion of the average wage paid in tax was about 19 percent. In the year 2007 that figure is now 23 percent—23 percent of the average wage is now paid in tax. I say to Dr Cullen that that is a disgrace, after 7 years of the incredible commodity boom that the New Zealand Government has enjoyed but that the New Zealand public most certainly has not.

Every one of those statistics has a terrible impact on our families and on their aspirations, and all that those statistics seem to do is to make more New Zealanders go overseas. The previous speaker started to make fun of Australia. Well, in fact, 500,000 New Zealanders have chosen to move to Australia. Basically, those people have chosen to go to a wealthier country than this one, and they are in a better position than we are to handle a high currency exchange rate and high interest rates. They have shared in and enjoyed the commodity boom over the last 5 or 6 years, because there has been a programme of personal tax cuts, year after year, in Australia. One cannot hide from that fact. Many Kiwis are envious of the New Zealanders who are now in Australia and enjoying the current tax rates and the economic boom there.

Dr Cullen also suggested a mortgage levy in 2006. Well, the mortgage levy is here. New Zealanders will be paying about $3 billion more in interest in 2008 than they were in 2006—$3 billion more for New Zealand mortgage payers; that is what they will be paying. That is the mortgage levy. It has arrived loud and clear, and Dr Cullen’s name is all over it.

The exchange rate of the New Zealand dollar is probably as high as it has been in 22 years. Our interest rates are the highest in the Western World and, more important, in the trading world. Some people seem to forget, even in this Export Year, that we are a trading nation. Again, I say New Zealanders have not been able to share in the commodity boom. Yes, we have dairying, yes, we have forestry, and yes, we have coal. Dr Cullen’s legacy is a disgrace.

Hon CLAYTON COSGROVE (Associate Minister of Finance) Link to this

That gentleman from the National Party, Craig Foss, is known for two things in this House. One is the fact that he spent all his time overseas when the National Party went into office, and he returned to New Zealand only when a Labour Government came in. Secondly, he waxes eloquent about tax, but he is known for one thing on tax in this House: bringing up his own tax return before the Finance and Expenditure Committee and asking the Inland Revenue Department for advice on it. That is his limitation on tax. He asked about the Labour record in office. I remind him that while he was overseas when the National Government was in office—and he returned in around 1999, when we won—unemployment was at 6.5 percent. When he came back from overseas after National lost, unemployment was at 6.5 percent, which the Labour Government inherited.

I remind him of the noose that hangs around Labour’s and Dr Cullen’s neck, which is one of 3.4 percent unemployment. Two young people in Kaiapoi, in my electorate, are unemployed and on the Work and Income books. No one is unemployed in Papanui and Rangiora. That is the legacy and the noose that hangs about every Labour member’s neck. My word, if it is a noose I want more of it, I want it to be heavier, and I want more of it now. Unemployment has never been so low since that member came back from overseas under a Labour Government.

I will challenge the National Party. We have found out three policies. I could not believe my luck when Dr Cullen allowed me to act for him for a couple of days while he was overseas. We netted, we snared, and we punctured the big fish, Mr English. What Mr English told the country—and I want every Grey Power member and every senior citizens club to listen to this—was that he raised the spectre of the means test on superannuation and the asset test on superannuation, and said superannuation was too generous. Then he said—and this must be a sort of “blue youth” strategy—that one could not win the 20-plus vote by telling those people that they would be secure in their retirement and that superannuation was too generous. Well, I want every person to listen to that, because of the history of that man and his successor, Don Brash, who, I ask members to remember, raised the spectre of raising the age from 65 to 70.

On 3 November, of course, John Key said the same thing: “We recognise that 65 is 65,”. He then went on to say: “and we are honouring that, but I don’t think there’s any doubt that the single-biggest way to reduce that liability is to raise the age of eligibility.” I tell members to believe what Tweedledumb and Tweedledumber say. They did it in Government. Bill English cut the pension twice. He was in a Government that raised it to 65. Don Brash said he might do it, National says it wants to abolish the Cullen fund, and Brian Fallow blew that one open on 3 November, when he said: “National also wants to abolish the Cullen superannuation fund.” Brash said he would raise the age, then we had Bill English; he could not be reined in by John Key, and he raised the spectre again. I tell every elderly person in the country not to judge them by their words; they should judge them by their actions in Government.

Then we have the other policy, Working for Families. National wants to tinker with Working for Families and give a tax cut. It wants to give an across-the-board tax cut where Mr English gets $110 a week, and 160,000 families lose about $50 to $80 a week. If someone is on $52,000 with three kids, and that person has a mortgage and is eligible, that person will pull in possibly $246 per week. That is 350,000 families, on average, getting $110 a week. So what Mr English says to the country is: “Give everybody a tax cut.”, and everybody says: “Hey, this is a great thing.”, until the communities do the figures and realise that 80 or 95 percent of them are out of the back door. So that is Working for Families.

Then, of course, we have Muldoon Mark II. Mr English and Mr Key say they think they will tinker with KiwiSaver. Well, we had a poll and did some research, and a third of young people say they will sign up, because they want to use the money for the first home that Mr Foss waxes on about when he talks about housing unaffordability. They want older folk to have security in their retirement. Those people who have never had the chance to get into superannuation want to have a go. And what does Bill “Rob Muldoon” English want to do? He and Mr Key have done 1975 all over again. They have raised the spectre that says when Kiwis get their statement next year, that shows how much money the Government, the employer, and they have put aside for their retirement—but hang on; as we approach an election, they should not tear that statement up, because Bill English says he will pull the rug out, so if National wins, and it will not, we will see the second-biggest piece of economic and social vandalism visited on this country. The first was Muldoon, when he bribed people with their own money and pulled the rug out from under every superannuitant in the country. The second one is that he has raised the spectre of it again.

So we have clarity at last around the Opposition, we have clarity around Working for Families, and 160,000 people should now reflect that they are going to have the economic rug pulled out from under them because Bill English wants every member of this House—all of us top 5 percent income earners—to get 110 bucks a week. All those 160,000 families gaining their own money back in tax credits—on average $110 a week—will get squat. They might get 10 or 20 bucks.

I ask communities to reflect on that. I ask elderly folk and those in their 50s, those who are 50 today, to reflect on the words of Bill English that I predict will come back to haunt him if I have anything to do about it, and will be drilled into him every time he tries to make a speech on superannuation. He wants to cut it—he said that. His leader has paraded around the country and said his party will tell anything to anybody, it will promise anything, it will ditch any policy and any moral fibre or ideology that it does have if it is deemed to be unpopular.

But I must hand it to Mr English that maybe he has been honest—and I think he has been; he has been absolutely upfront and honest because he is a true Tory, blue through and through. He will cut superannuation and he will nail every person on the cusp of retirement and every young person who wants to start to buy a new home. What good is a tax cut of 10 or 20 bucks a week to a mechanic, or a young person on a low income who is saving to get a home, when they can enrol in KiwiSaver and use the Government’s money, their employer’s money, and their own money to convert that into a deposit for a first home? I ask him to explain that and to go down to the mechanic’s shop and the chippy’s shop and all those young people who—at least one-third of them—are now looking at getting into the scheme. Then, of course, KiwiSaver—in the spectre he has raised—gets the rug pulled from under it.

So I ask Mr Foss, that great tax return expert, to reflect on records. I ask him to remember when he came back from his lofty job and graced us, the people of New Zealand, with his presence on our shores—he came back when Labour was in Government—and to reflect on the situation then: 6.5 percent unemployment, no apprenticeship system, because National got rid of it, students with debt up to their eyeballs, a mortgage, but no house, effectively; and I ask him to reflect on the situation now: 3.4 percent unemployment, interest-free loans and incentives to stay here, a re-engaging in apprenticeships of 10,000, and next year there will be 14,000 young people in trade training. I ask him, whilst he was overseas earning his big bucks, to reflect on that record because that record stands in stark contrast to three cuts in the pension, the rug pulled out from the elderly, apprenticeships going, and all the other insidious economic vandalism that National engaged in.

Finally, I invite all the communities to reflect very, very carefully and not to be bought and sold by slogans. Tax cuts may sound great until the communities—and they are smart—do the numbers and work out the figures. I remember Gerry Brownlee—the man who has as much credibility as a Mississippi riverboat gambler—saying on the radio that people do not understand budgets, they would not know a budget, they do not understand them. I say that if people can balance their housekeeping, if they can go out and get the groceries and sort out their bills, they have a PhD in economics in the community. They are not silly, they will read Mr English’s words, which will be the epitaph on his political tombstone, and they will be revisited time and time again on him. I invite him, if he wants to, to get up and deny anything I have said and to refute anything I have said on Working for Families, on national superannuation, and on KiwiSaver. Do you know what? He will not do that, he cannot, because at least he is honest about it.

TIM GROSER (National) Link to this

I found it very interesting that Clayton Cosgrove, in his presentation, started to talk about Michael Cullen’s legacy. It is amazing what people under pressure reveal about their true thinking. What does the word “legacy” mean? When we start talking about people’s legacy, we are talking about people who are on their way out—possibly literally as well as metaphorically.

I want to take up the challenge that Mr Cosgrove put down and give my view of the Cullen legacy, and I will refer to an earlier career that Michael Cullen had as an economic historian. As an economic historian, Michael Cullen may well remember the methodology called thought experiments, so I will put a thought experiment on the floor of the Chamber. I ask what Michael Cullen the economic historian would have made of Michael Cullen the Minister of Finance, because that would be a very interesting subject for debate. I am probably not confident that such a separation is possible, so I will give members what I think economic historians will make of Michael Cullen’s legacy as Minister of Finance.

I think the main theme of Michael Cullen’s legacy—if I can use Clayton Cosgrove’s phrase—will be a story, fundamentally, about missed opportunities. There was a time, when this Government inherited political power, when we thought it might just build on the successes of the past. It had inherited an economy in which the unemployment rate had fallen progressively through the 1990s from about 11.5 percent to a little over 6 percent, with a much more dramatic fall in Māori unemployment. It had seen double-digit inflation squeezed out of the economy, and it had Government accounts that, through a process of fiscal consolidation, were in much better shape than previously. New Zealand was extremely well placed to build on that success, and there was a moment in time when I and many other people with both a strong personal and professional interest thought that maybe this Government might just do it.

But unfortunately, that thought collapsed very quickly. It collapsed, I thought, finally during an argument between Dr John Hood and the Prime Minister. When faced with the idea of a target of getting New Zealand back into the top half of the OECD, the Prime Minister backed off very, very fast when she understood what the real political implications of following a wealth-creating, growth-oriented programme would mean for this Labour Government. Instead, Labour fell back to type, and decided to sit in the sun and play the politics of redistribution.

I would say we are seeing, after 7 years of that, the chickens come home to roost. We have seen cost increases spread, imperceptibly at times but cumulatively, throughout the economy, a continual growth of low-quality Government expenditures in such areas as health, a big-ticket item where there has been a $4 billion increase in funding and a 23 percent increase in the number of health administrators—adding what, in terms of productivity and in terms of health outcomes? We have seen a continual increase in interest rates, which are now considerably above other countries’ interest rates, and we have seen a continuation of the New Zealand exodus as, faced with a global job market, New Zealanders are simply voting with their feet. I think those are some of the key elements in the legacy of Michael Cullen, the Minister of Finance. It would be intriguing to know what an earlier and younger Michael Cullen, as an economic historian, might have made of what Mr Cosgrove calls Dr Cullen’s legacy.

Most of all, we have seen a slow-down in New Zealand’s productivity growth rate, which in the long run is perhaps the most troublesome of all of the legacies of the reign of this Minister of Finance over—now—almost 2½ terms. We have seen total factor productivity growth halved—no, it is down by more than a half; I think it has fallen to nearly one-third of its previous rate—and labour productivity growth halved, if we compare the productivity growth rates from 1992 to 2000 with those of the last 6 years.

In contrast, the National Party offers New Zealand a focus on growth and a focus on tax reform, not just as a one-off hit when forced by politics to go into that issue but also as a continual focus in order to maintain the competitiveness of the tax structures in this country.

Hon DAVID CARTER (National) Link to this

It is with pleasure that I take a call on Vote Agriculture and Forestry in the 2007-08 estimates debate. I guess the examination that the Primary Production Committee did left National members of Parliament in no doubt that the Minister of Agriculture simply does not understand the issues. We examined him over a period of an hour or more. We asked him serious questions, and we got the waffly sorts of answers that the farming community now expects from this Minister. There is no substance, but a whole lot of waffle and fluff, without any actual support for the farmers of this country. Mr Anderton seemed to be absolutely oblivious to the pressure that many farmers are under. He was proud of the fact that while the East Coast of the North Island was under severe drought pressure, he managed to take a helicopter ride over the province—a whirlwind tour. It had rained a couple of days after his visit, and he claimed credit for being the “Minister in Charge of Weather-changing Ability”.

What really surprised the select committee, though, was the very dramatic increase in staff that has occurred in the Ministry of Agriculture and Forestry. In 2003 it employed just over 1,200 people. In the last 4 years, there has been a 40 percent increase, to 1,650 full-time employees. That is a massive 40 percent increase. The select committee delved into those figures and found some very surprising trends. Firstly, 980 of them are Biosecurity New Zealand staff—and my colleague Shane Ardern will certainly comment very shortly on their ability to do their job—and, secondly, 475 of them are in the Food Safety Authority, which leaves only 185 to do the real work that is required by Vote Agriculture and Forestry, which is to analyse the issues that present themselves to the farming community.

During the examination of Mr Anderton, he proudly said there were 13 substantial discussion documents out there being analysed by those 185 policy analysts. He did not seem to appreciate how important those particular policy documents are. The sustainable land management discussion document has been out there now for months. It was reported back after a series of public meetings, which were not attended by any Government MPs—they would not front up. But, certainly, every one had a raft of National MPs there to listen to the woes of the sector, particularly to those of the forestry sector around climate change. But the one that I picked up on was the programme that Mr Anderton calls the Sustainable Water Programme of Action. What quickly became evident to us is that it is the programme of inaction. There have been absolutely no decisions from that Minister in relation to one of the most pressing concerns facing rural New Zealanders, which is how to maximise the use of potential water sources in order to maximise production. We are just not getting the answers from this Minister at all on that issue.

The members of the select committee then found, when we looked at the new initiatives the Minister was very proud of, that the main one was a congress. Yes, in November this year Mr Anderton is organising a congress, and he has a million dollars of taxpayers’ money to fund it. So we asked him where the stupid idea of having another talkfest came from, and he tried to tell the select committee that he had called a dinner at Vogel House for all primary sector leaders, and that they had asked for the congress. Now, we, frankly, do not believe the Minister, because we know the leaders of the primary industries far better than Mr Anderton does, and we know the last thing they want is more talk. They actually want some action. What we were able to find out, during the select committee examination, is that for a million dollars Mr Anderton will hold a talkfest in late November this year. Speakers from all over the world will be brought in. We asked who they were, and the Minister said that that information was commercially secretive at this stage, but we do know they are coming from all over the world to speak to farmers. Then we found out that there will be a charge for people to attend the congress—Mr Horomia nods his head—of $500 to $800.

Farmers are under real pressure because lamb is now worth 30 to 40 percent less than it was worth a year ago, and Mr Anderton’s solution is to hold a talkfest and ask farmers to pay 800 bucks in order to attend it. It is all about photo opportunities for Mr Anderton, and the sooner that people realise that is all that Minister is good for, the better it will be.

R DOUG WOOLERTON (NZ First) Link to this

Unlike the National Party member David Carter, I do not rise to criticise the Minister of Agriculture, who is also the Minister of Forestry.

SHANE ARDERN (National—Taranaki-King Country) Link to this

It is with pleasure that I rise to speak in this estimates debate on the Ministry of Agriculture and Forestry. I will share with the Committee some of the concerns I have as a result of being part of the Primary Production Committee that examined those estimates.

First of all, I asked the Minister for Biosecurity, Jim Anderton, what was being done to control didymo and how much work was going into research into a way to control it and, potentially, eradicate it. The Minister said to me that I had spread much misinformation on that subject. In fact, I think the Minister dedicated about four pages of the 8-page communiqué that came out afterwards to criticising my comments, which demonstrates that I clearly got under the Minister’s skin at that select committee and hit a raw nerve.

But, that having been said, he asked what I was doing with regard to promoting the good works of Biosecurity New Zealand, and he said that, instead of being negative, I should promote the positive things that have happened with regard to the control of didymo. I thought I would do a bit of research and see how the rest of the community is seeing this good work.

In a summer survey of users of upper South Island rivers, 24 percent reported that they had checked, cleaned, and dried their gear with regard to shifting from one river to another. What do we know about the spread of didymo? We know that it is being spread by people, not by wildlife as first thought by this Minister. That would clearly demonstrate that this is not working, and the Minister needs to do more about it.

What has the Minister done in response to the Tongariro recreational group that made several submissions to him about trying to contain didymo in the South Island? The answer is that he has done very little, if anything at all. They are gravely concerned. Let us look at some facts. In the past 5 years 233 new organisms have entered New Zealand. New Zealand’s isolation has given us a special environment to enjoy and protect, and we need to do so. The question is: how much insurance is too much and how much is not enough? Clearly, when we look at those statistics, we can see that we do not have enough insurance at the moment. The most dangerous enemy we face in biosecurity in New Zealand at the moment is the culture of apathy that exists within the Minister and his department. The Minister needs to take account of what is happening at our borders and do something. We are too slow to react. We are too quick to dismiss eradication as an option.

I do not accept that it is too hard, like the Minister does, and I do not accept that there is not enough scientific evidence around the world to address some of these issues. The Minister need only look across the Tasman to our Australian counterparts and ask what happened in the case of the black-striped mussel incursion in Darwin Harbour to find out that they used a copper sulphate - based material, similar to that now being promoted by the Environmental Risk Management Authority as a potential control for didymo. Yet the Minister and the ministry will tell us that there was no science-based evidence that suggested at the time that that may be a successful product. Why not talk to international biosecurity agencies that have done the work?

Last year 15 tonnes of fruit fly material was intercepted at our borders, including 8.2 tonnes of meat products and 3.7 tonnes of grain. How do we know this? We know this because we caught those people—it was on their person. We could say that that is good, but Biosecurity New Zealand itself says its audit suggests that, at best, 10 percent gets through, and any one of these products has the potential to devastate our economy. I say to the Committee today that it is time this Minister did more than just have a talkfest. He should get off his butt and do something about it. Clearly our $200 instant fine at the borders is not working.

Hon DAMIEN O'CONNOR (Minister for Rural Affairs) Link to this

I stand as Minister for Rural Affairs and as Acting Minister of Agriculture to respond to some of the ridiculous claims made here in the Chamber. I have to say that it was rather rich of the previous speaker to get up in this Chamber and criticise Biosecurity New Zealand. When we came into Government in 1999 the National Government had spent $86 million or thereabouts on biosecurity. This year $186 million has been spent. That is why we are catching more people who are trying to bring in goods. That is why we are catching more at the borders. I say that that is a measure of success.

The speeches we have just heard clearly identify a party wracked with division. It really does not know whether it should advocate for more spending and more people in agriculture and forestry—an area in which over 17 percent of the GDP in this country is created and generated. It is a party that does not know whether it should criticise the Ministry of Agriculture and Forestry for increasing the number of staff by 40 percent, or whether it should cut its spending and see that number of staff reduced to the point where they are not able to undertake the tasks before them.

I will go through just a few things. I think the select committee report correctly identifies a few of the issues facing the ministry. It is a key policy department, it has huge responsibilities in the areas of biosecurity and food safety, and I think it has done an exceptional job through the year.

I would like to look at what we might consider as the alternative policy. What would those critics, who we have just heard in this Chamber, put up by way of an alternative to the current management—

PHIL HEATLEY (National—Whangarei) Link to this

Thank you, Mr Chairperson—[ Interruption] It is interesting that the Minister Pete Hodgson, who passed the hospital pass to other fisheries Ministers after him in the aquaculture arena, is the first member to heckle, mock, and make light of this fisheries report in the Committee today. I would remind the former Minister of Fisheries Pete Hodgson of what happened with the aquaculture reforms. Under this Labour Government there have been a fair few former Ministers of Fisheries, and I will count them. We had Minister Pete Hodgson, who complicated the proposed aquaculture reforms; then we had Minister David Benson-Pope, who further complicated the actual aquaculture reforms; and now we have Jim Anderton, who is running around the country apologising for the aquaculture reforms. But it was Pete Hodgson who started it all, so I am intrigued that he is the first one to try to disrupt me in this Chamber.

I would make a mention to this Committee of the intriguing section of this fisheries report on aquaculture. Although I raise it with the Committee, members may recall 2½ years ago when the Labour Government passed the aquaculture reforms through this Parliament. In those reforms the Government stated that it would create aquaculture management areas up and down the coastline of this country. It would create large-scale areas off the coastline where aquaculture could occur. In the 2½ years since that time, the Labour Government has created zero aquaculture management areas up and down the coastline of this country. There have been zero new aquaculture management areas created in 2½ years.

Are there any aquaculture management areas? Yes. What the Minister has done is to draw a pencil around all the existing marine farms in the country and call them aquaculture management areas, but in terms of new areas, where new aquaculture can move in, not a single square metre has been created in New Zealand in the last 2½ years. That is fascinating in the sense that recently the Minister paid $65,000 of taxpayer money to brag to the country that he would back growing of the aquaculture industry into a billion-dollar industry in 2025. He used $65,000 of taxpayers’ money to promote growing the aquaculture industry into a billion-dollar industry in 2025 after he announced his wonderful reforms. What he did not know was that the industry had decided before his reforms that it would be a billion-dollar industry in 2020. Before the reforms, a billion-dollar industry in 2020; after the reforms, a billion-dollar industry in 2025! The taxpayer paid $65,000 to inform the public that we have slipped back 5 years after the Minister’s reforms. That is very sad news for aquaculture, indeed.

What is doubly worrying is that, tied to the aquaculture law reform that happened 2½ years ago, Māori were promised 20 percent of existing aquaculture space. What is more, they were promised 20 percent of all new aquaculture space. There has been no new aquaculture space; therefore, there has been no granting of space to Māori, whatsoever. In other words, 2½ years ago Parekura Horomia ran up and down marae all over this country, talking about the wonderful aquaculture settlement, but Parekura Horomia has not delivered a single square metre to any iwi anywhere in the country. He has gone along to marae, he has accepted a feed, he has eaten pipi and had a good boil-up, but he has not delivered a single square metre of aquaculture space to any iwi in the country.

According to Ministry of Fisheries figures, of course, Parekura Horomia has actually promised iwi right throughout the country—and this is on the ministry’s website—1,949 hectares. That is what Parekura Horomia promised iwi 2½ years ago when he was running up and down the country and going on marae, having a boil-up and eating pipi and cockles. That is what he promised them—1,949 hectares. Today, 2½ years later, Parekura Horomia visits iwi on marae up and down the country, but he has not delivered one single square metre of new marine space to any iwi anywhere, and he should be ashamed of that—absolutely ashamed of leading his own people up the garden path.

Hon PAREKURA HOROMIA (Associate Minister of Fisheries) Link to this

There is one thing about cultureless people—they make insidious remarks about personalities when they do not even understand what a boil-up is. But I suppose that is where that speaker is lacking in intelligence.

The aquaculture industry’s goal is to be a billion-dollar industry by 2025. That is the Government’s role, and what that member is not stating is that, in the sense of Māori, by January 2008 there is purchase right that the Government can exercise on behalf of Māori. I can tell that person that there are rights in local authorities, and there are issues that have to be managed by them and by central government.

This Government has been very supportive of regional councils. It has allocated $2 million to ensure that the information and resources are there and that the Government’s work programme is quite clear. Both my colleagues Minister Benson-Pope and Minister Hodgson have done well and ensured that after the aquaculture moratorium became inactive, a large number of applications, with regard to many thousands of hectares—and that is where that member has been distorting the truth—had already been notified by councils and were allowed to proceed. With the great support of this Government there has been a real and total surety about aquaculture being a key, integral part of this country going forward.

Certainly, in relation to the moratorium over the last 6 years, the councils and the Ministry of Fisheries have processed over 200 of these applications. That member was making out that there was zero—that there was nothing. But they were in action, and New Zealand has increased the hectarage by nearly 48 percent. It is the fastest growth period to date. That is what has happened, but that member has been making out that nothing has happened.

We have formed the New Zealand aquaculture group, which is really, really going forward and is very thankful for this Government’s support. There is nonsense from that member from up in Whangarei. He wants to be very thankful that this Government has really put those issues forward—issues that had been put asunder by some people’s red-neckery—in relation to what should be happening in the fisheries area.

I want to tell the Committee that fisheries development in this country is well supported by this Government, and, certainly, that member from Whangarei should be more supportive, because we know that at the end of the day he is always in silent and secret negotiations with us to make sure that the aquaculture platform and the fisheries platform in this country are well preserved, and only this Government can do that.

KATHERINE RICH (National) Link to this

I rise to speak on education in this debate and, although I am not very good at joke-telling, I have to relate a particular joke that is doing the rounds of Opposition corridors at the moment. It is: what does Steve Maharey have in common with Corporal Apiata? The answer is that they are both going to take on VC roles very soon.

If we look at the estimates this Minister has put in place, we are shown that his focus has not been on the education portfolio. His focus has been on finding additional vocational opportunities for himself, as opposed to dealing with some of the tough issues relating to truancy, problems with student behaviour in classrooms, poor academic attainment, and problems with literacy and numeracy.

We have to go only as far as the early childhood education sector to realise why this Minister is seeking other vocational opportunities in the tertiary sector rather than concentrating on fixing early childhood education problems. We need look only at the Government’s 20 hours free policy, which was touted and promoted in July 2005 with all the fanfare and fervour of the election. The Government started off by saying that all 3 and 4-year-old children would be receiving 20 free hours come July 7, but what was presented to and discussed at our select committee was something quite different—only a fraction of 3 and 4-year-olds were to receive free early childhood education. The numbers started to slip and slide, and slither around, from “definitely” 86,000 children to “nearly” that number, and then we heard that “perhaps” 92,000 would have access. But on this side of the Chamber we understand totally that there is a difference between having access and actually receiving free education. So when the numbers were rolled out in July the reality was quite different, and we saw that 27,000 3 and 4-year-olds had no place to go.

There was the interesting story of a guy who searched around in Auckland for a centre in his area. He found one that was providing 20 free hours, but the waiting list was 3½ years long. Most parents plan their children with some forethought, but I do not know a single parent in New Zealand who would think to put his or her child down for 20 hours free, 6 months before that child was conceived. It is just utterly ridiculous.

Then we saw the moving feast in relation to how much parents would actually save from this policy. The Prime Minister told parents it would be $90 a week. The Minister in the chair, Steve Maharey, has started to use the figure of $60 a week, and today in the House he would not explain the big gap in those figures. But then we heard the view of New Zealand Kindergartens that its parents would save less than $20 a week. Once again, we see the difference between the puff, the bluster, and the weasel words of the election compared with what was actually presented as part of the Budget and reviewed as part of the estimates process.

A few days before the policy went live we asked how many centres would take it up and the Minister could not say. He could not say how many centres were going to take it up or how many children were going to take it up. Even when we look at the figures that are presented today, we cannot bank on those figures because there has been double counting. We have centres on websites reportedly offering the service, but then they ring up and say no—they are not providing the service, at all. This is an example of how to spend $313 million but actually please nobody. It does not even make a difference to increasing participation rates within our most vulnerable sectors. My colleague Paula Bennett raised the issue of the 10,000 forgotten kids who are not in early childhood education at all. This kind of blanket approach does not make one skerrick of difference to those kids who are currently getting nothing at all.

Within this process we were hoping for some solutions to some of the really important problems in education. For example, we asked the Minister to explain why truancy has increased by 41 percent in just the last 4 years. We now have 30,000 kids each week who play hookey from school. Some of those kids will be taking just a day or so off, but we have a disturbing, growing trend in the number of serial and long-term truants who are not learning because they are not at school. So there is nothing for them. There is nothing to deal with the disturbing and challenging behaviours that our teachers are facing on a daily basis. It is no wonder that the suspensions and stand-down rates are rocketing. We have seen the Minister come out and make a blanket change to exemptions. He gives no answer to some very difficult issues in education, just rhetoric and bluster.

Hon BRIAN DONNELLY (NZ First) Link to this

I would like to draw the Committee’s attention to page 424 of the Estimates of Appropriations, which refers to performance measures for primary schools. In particular, it talks about schools remaining open for the delivery of curriculum, in terms of the national curriculum education guidelines. The performance standards for 2007-08 are the equivalent of 394 half-days per annum in the 2007-08 financial year. I raise this point because that will be an absolute impossibility for achievement by the schools themselves. Already the Minister has gazetted that instead of schools having to be open for 394 half-days in 2007, they will have to be open for only 386 half-days. In 2008 they will have to be open for 384 half-days. Over the next 4 years, in fact, 16 full days of primary education will be lost to primary students in this country.

I raise the point because there is a huge body of evidence that shows that engaged academic learning time is a critical criterion in educational achievement. I know that the Minister will respond by saying that compared with our OECD partners we have a very good record, etc. In fact, our school day is not a long one, largely because we established it, back in 1877, so that the children could go home to do the milking, or allow mum to go off to do it. We still have that “qwerty” problem within the system as it stands. But we need to be comparing ourselves not just with OECD countries but with emerging economies, and certainly with the emerging economies of Asia. I can assure the Minister that in our schools we come nowhere near to having the sorts of hours of engaged academic learning time achieved by those economies. I believe that this is a considerable point of interest, because parents would be horrified to know that 16 days have actually been knocked off their children’s learning time over the next 4 years.

On the other side, there are some positives in terms of keeping children at school. There is an almost half-million dollar increase in district truancy services, and ENROL, the school student enrolment register, will be extended to all schools. This will certainly pick up many students who presently fall through the gaps. However, continued concern has to be raised about the extremely high number of early school-leaving exemptions that are taking place. They have skyrocketed. One of the reasons mooted for it is the National Certificate of Educational Achievement (NCEA) league tables. In fact, schools, knowing full well that they are going to confront the NCEA league tables on the basis of the number of students enrolled and that they have a number of students who are not achieving too well, are actually taking the step to go for the early school-leaving exemption. We consider that that needs to be looked at very carefully.

On the other side of the picture, the Government is saying that we need to increase participation in early childhood education—while it is cutting down participation or engaged academic learning time, in the early childhood education sector it is trying to increase that. A lot of noise has been made about the 20 free hours policy. But we have to think back. Our free education policy has been in place since 1877. Schools still ask for donations from parents for optional extras. I have to say that National was more than happy to bounce off the policy of New Zealand First in relation to free health care for under-sixes, which in fact was not free in the sense that doctors were able to ask for additional costs as well. But National still used that policy and praised us for it.

But here is the point: in terms of performance standards we have gone from $586 million for early childhood education last year to $755 million. That is a big increase, and one would hope that with that big increase would come an increase in the number of hours that students receive. In fact, in 2006-07 we budgeted for between 120 million and 128.2 million hours of participation. For the additional funding, we have actually reduced that predicted amount to between 118 million and 125.4 million hours. In other words, we are getting less output as a result. However, for those people who are still saying that there is nothing in this 20 free hours policy, I point out that some of the figures have increased the rates quite significantly.

PAULA BENNETT (National) Link to this

I stand to speak to the education estimates and to the Minister. I suppose that the member who spoke just before me, Brian Donnelly, was talking about the 20 free hours policy. I was sitting here thinking that the Minister must have been absolutely kicking himself for having put so much effort—and this was the Government’s big announcement for 1 July—into something that it has had no pick-up on whatsoever. The public out there are saying that they simply do not believe the Minister. They simply do not believe that the initiative is free. They simply do not believe that 20 free hours early childhood education is accessible for all the children who were promised it. As a consequence, although some are saving a little bit of money most are unable to access the 20 free hours early childhood education.

I start by asking the Minister a question. How much will parents save if their child is one of the 27,000 who are missing out on this subsidy? For example, if their child is one of the 49 percent of Auckland children who do not have access to 20 free hours childcare, what does that actually mean for them? The estimates can talk about the millions being spent and how that money is being put in, but the reality is that children are not getting 20 free hours early childhood education, and it is not accessible for all 3 and 4-year-olds.

We certainly heard the question of what the National Party would do when in Government. That is actually a fairly fair question, and it is one we are looking at addressing over the upcoming months. But the real concern to us is the mess that we will have to clean up. We just need to look at what has happened with tertiary education and the fact that Dr Cullen had to step in, at what is going on with broadcasting, and at the haphazard policy made on the hoof in an election campaign when a party is worried about its future, and what we see is a mess. What we see is a fraud, and what we see is children actually missing out. When we see that sort of thing and look at our own policy, we say that what we want to be doing is addressing something that is honest and something that we really can deliver to all those children who need it.

Of real concern to us when we look through the estimates—and my colleague Katherine Rich mentioned this—is those children who are missing out now. The Government, in its early days, used to talk about those vulnerable children who are not accessing early childhood education. The Government used to actually count them, to care about them, and to give a damn, but we do not even hear about them any more. So when we bandy around numbers of 92,000 children, and the Minister sometimes says they are the eligible children, we say that, no, they are not, and the Minister knows it. The 92,000 children are the children who are currently accessing some form of early childhood education. They are not the only children who are eligible, so it those other children whom we should be most concerned about. It is those children who then do not go to school, and who then become statistics. It is those children who then become truants and who then are the most vulnerable later on in terms of becoming statistics in our prisons, and that sort of thing. There is research proving that.

So this Government no longer talks about those vulnerable children and no longer speaks about actually addressing participation rates in early childhood education. And, yes, those rates are high—early childhood education participation rates are up at the level of 92 percent—but a huge number are accessing it for only a short period of time. So we no longer talk about participation. We now talk about making it cheaper, and we talk about subsidies. We bandy around numbers of savings for parents of $90 a week, then savings of $60, then the Minister says $30 to $35 in the House today, then we have kindergarten associations saying that it might be up to $20 a week. Parents might be saved a bit of money, and good on them—all people need a bit of extra cash in their hands each week—but what about those kids who need early childhood education the most? And what about those kids who are not participating in any sort of early childhood education? Where in this Budget are they addressed? Where are the estimates that say that we will support them?

How is the promoting of participation going? What about the programme, set up by this Government, that is supposed to be about going out and talking to those Māori and Pacific Island communities and getting them involved? How many of their contracts have been terminated? How many of their contracts have not been rolled over and have been terminated, purely because they were not addressing what actually needed to be addressed, and there was not a level of accountability?

ALLAN PEACHEY (National—Tamaki) Link to this

I take the few moments allotted to me to speak in the estimates debate to refer to what I have described in other writings as the silent catastrophe in our schooling system. I express some pleasure—some satisfaction—that as a result of the work of the Education and Science Committee and the debate in this House, some recognition is now finally coming that for too many of our children the collapse in the teaching of numeracy and literacy is having a negative effect on their lives and a negative effect on the prosperity and growth of this country.

Nobody can argue with the statistics. We all know—and there is no point in disputing it—that something like 30 percent of our children are not learning to read, write, or calculate at a level sufficiently high enough for them to function fully in the adult community. That has consequences for our economy. It also has consequences for the strength of our democratic system. We cannot ignore that.

After 60 years of compulsory universal education and schooling in New Zealand, we have reached a point where a third of our children, for a variety of reasons, are not learning the basics that they need to function in our community. At least we no longer brush that under the carpet, and at long last we are seeing some recognition of the need to challenge that problem.

I caution the Government not to fall into the trap that educationalists have been falling into for years, and that is to say: “Look at how good the top end is. Look at how good our best students do.” Nobody knows better than I how good our best schools are, how good our best schoolteachers are, and how good our best students are. However, that is not a solution and not an answer for those children who are not experiencing success. It is vital that in this debate we move beyond cheap point-scoring excuses and that sort of thing and actually make some sort of commitment in this House that it is in the national interest of this country that we earnestly and urgently address the failure in learning of 30 percent of our children. We should be capable of doing that.

If I could offer the Minister a little bit of advice, I would suggest that everywhere where the centralised answer lies in bureaucracy, and where an approach of appointing more officials has been used, very little progress has been made. The most difficult change to bring about in a schooling system is in the relationship between individual teachers and children in the classroom. We will not solve this problem for our children until we find a way of addressing that issue. One of the first things we have to do is to develop greater respect for the work of the schoolteacher. It is far too easy, far too often, to expect the school to be a panacea for all of the community’s worries. Then, when that panacea does not develop, we make the school a scapegoat.

This issue of literacy and numeracy will be solved only in the quality of the relationships that are established in classrooms between schoolteachers and children. It is the same with the truancy issue. Children begin to truant from school because they become disengaged from learning. It is teachers who engage children in learning. I regret to say it, but too many of our children are imprisoned in schools where the expectations are not high enough, where the excuses are rampant, and where the ideology is more important than whether children are learning. We have to get to a point where school teaching in New Zealand once again attracts its share of the top third of graduates coming through our universities. There are principals out there and people involved in teacher training and teacher recruitment who will tell us that that is not happening.

Hon STEVE MAHAREY (Minister of Education) Link to this

In reflecting on the estimates vote, I begin at the beginning of where I think everybody has got to today. I think we have a lot of agreement about education at the present time. I listened to Brian Donnelly—whom I listen to a great deal on these issues—and I heard a bit of dispute about the issue of the number of hours that kids will spend in the classroom. I will come back to that in a second, because I think there is a way of relieving that issue in the member’s mind.

I hear a lot of reinforcement about what we are doing in education right now. I do not think anybody would say that everything is perfect in education, but we are on the right road. I want to come back to that road in a little while. I listened to Katherine Rich, and I heard, really, an endorsement around the issues of early childhood education. She might not like the way it is running at the present time—there is debate about that, of course—but I do not hear any real dispute from Katherine Rich or from Paula Bennett about the need for us to have a strategy around early childhood education and for young people to be in education.

Whether or not we see the policy working explicitly as it should right now—and we will have different views on that—I think we all agree that this country ought to commit itself to having 3 and 4-year-olds in education. That is the big step forward here. We are saying that taxpayers now want to pay for education in that preschool area because they can see it makes a big difference to one’s later educational career and then, hopefully, to one’s work or whatever one might do. That is agreed; I can see that as I look around the Chamber. We will argue about details, I am sure, until the cows come home, but we agree on that.

I listened to Mr Peachey—he is also someone whom I listen to a lot; he has standing in the educational area because of his career as a principal—and I heard him say it is great that we are talking about literacy and numeracy now. He said it is great that we are starting to get on top of the issue in terms of the way we teach literacy and numeracy. We can see some real turn-round in that for Māori, and that we are seeing some real results in terms of their achievement in this area. Mr Peachey points to the fact that we have to focus on effective teaching. This is the key to making sure we make a difference in our education system. The key is not a bureaucrat sitting in a building here in Wellington; it is what happens in that interface between the learner and the teacher that matters. I hear that point coming through from Mr Peachey.

So I hear a lot of agreement around the Chamber. The road we have felt ourselves going down over the last 4 or 5 years I have labelled “personalising learning”. This is all about trying to have a 21st century education system that fits with the needs of young New Zealanders today, which means, in a nutshell, that they have to be active learners and not have content driven into them, which is what happened to most of us in this Chamber. That is the way education was for most of us. We sat in big classes in front of the teacher, and the teacher put as much content as he or she possibly could into us each day, and we had to give it back in exams.

We know that that approach will not work in this century. We know that it will not solve the problems with literacy and numeracy. It will not motivate students. It will not make our schools the kind of schools they should be. The right approach is all about getting active participants in the learning process. That is what personalising learning is all about, and that is the direction we are going in. I hope that between us we can consolidate that kind of learning, whether it is in early childhood, primary, secondary, or tertiary education, because that will make us No. 1 in education.

Someone—I think it was Mr Donnelly—mentioned the Asian systems. Now, frankly, as he knows, they look to us. They may have longer school days, but they recognise that what they are doing in Asia at the present time is building last century’s form of education. They are building large schools. They are doing what we did last century—stuffing content into the heads of their students. They know there is a real problem with that. They need creative, innovative, self-motivated students to come out of there, and they cannot get them from that education system. So as much as I admire a lot about what I see in Asia at the present time, as big education systems are rapidly put together, one would have to say that Asia is starting to look to countries like us and ask how at least parts of their systems can be made more innovative. We are on the right track. We ought to argue vigorously, as we are doing, about how that track should be followed. It would be awful to see it change now that we have basically figured out which way to go.

I say to Katherine Rich that I have been following some of the statements around the National Party education policy. I notice, for example, that John Key is saying we have a very successful education system, and that is great to hear. We hear from Katherine Rich that she does not want to change much about the education system if she ever gets the chance to be in a position to do so.

One little thing that does worry me is hearing John Key on Campbell Live saying: “We don’t want a monopoly on education by any particular provider.” I think one of our strengths is that we do have a public education system that is dominating the education system. I like that. I think it has worked for the Swedes and it has worked for us, and I think we should stay with that but, of course, allow an enormous amount of innovation within that system. That is what we should be trying to do. Therefore, I welcome the fact that Katherine Rich has been saying she does not agree with the notion of vouchering the system, or privatising the system, or breaking it up in that way. Given the performance of Mr Ryall in defeating Mr Key around the health legislation recently, I am hoping that Katherine Rich will have the same success in defeating John Key around education.

I go back to the estimates. I think they are enormously successful. If we go through them and look at the amount of money that is going into the early childhood strategy, we see that it is an enormous amount, and the 20 free hours policy is just part of it. We are also professionalising teachers, upgrading centres, and building ourselves an education sector in that pre-school area. We will get there by 2012, and these estimates make sure that we go down that road.

People have talked about keeping students at school. I thank Mr Donnelly for pointing out that there are really good strategies in here—but not enough. We can see that do have a problem here when we compare ourselves with other countries around the world, but we are now fully committed to keeping kids at school until they are 16 and getting them qualified. There are many initiatives in this Budget that will help with that. There is help for parental involvement. We know that if we can keep parents, communities, and whānau involved in education the kids get a better education. The Team-Up initiative and Te Mana campaign, for example, which we will continue to fund, are having enormous success.

We have had discussions about technology and technology teachers, and, once again, this Budget is about trying to get more technology teachers and get the curriculum right. I am sure the House will be absolutely delighted with the new curriculum. It pumps up that technology area as it ought to do. We have looked at leadership issues, particularly in the areas of trying to provide more support for principals and for aspiring principals, because we need a lot of young people to come into those kinds of positions.

Literacy and numeracy issues are being addressed in this Budget—once again, with new funding—and National Certificate of Educational Achievement (NCEA) issues are being addressed. We have, of course, made some good changes to NCEA. I think we now have a quality assessment system, and I see that people around the country are now beginning to applaud what we have and get in behind it because it is the right way to go.

We have tried to do more for Māori. We have provided more resources for special education, and there is more in the operations grant for all schools. Right across the education system we are doing more around issues to do with behaviour, and we have tried to assist with that. We have tried to make sure we have more information going out to parents. We have the huge Mission-On initiative, which runs across sport, health, and education. We have done more in the area of staffing ratios with students. We have done more for teacher supply. We have done more for information and communications technology.

We have changed the school dates a little. To ease the member’s mind, I point out we have done that because that beginning part of the year with Waitangi Day is an area of the school year that is not used efficiently, and, really, that stop-start approach was not doing a great job. If we can get started on a day after Waitangi Day for most kids, they will get on with it. Schools that want to start earlier can do so. There is flexibility there, as well. We have been doing more for boys’ learning. We have been trying to make sure that the curriculum is going to come through soon. We have, as I said, worked on the technology area. We have got more coming through for Pasifika, where we have to do a whole lot more at keeping young people at work, and we have more coming through in apprenticeships.

I turn my attention to the tertiary area. There is $89 million to strengthen the international competitiveness of our universities; $40 million for change in the sector; $21 million in operating funding, and $55 million in capital funding. There is $35 million to support areas such as polytechnics and wānanga, $6 million for building research capability in wānanga, and $53 for industry training and apprenticeships. All those kinds of things are illustrated in this Budget. It is a hugely comprehensive, forward-looking Budget, right across from the early childhood sector to the tertiary sector.

I see that Colin King wants to rise in a moment to talk, and I know he has a lot of good things to say about education as well. But I applaud the fact that underneath our debates we have agreement on education. We will differ on the detail, but I am very pleased today to be able to say that I hear around the House a broad agreement for the direction, and that is great. We should settle that in, get a 21st century education system, not change direction, invest in the things that make a real difference, and argue about the details. I welcome that. I will sit down, and I am sure I will hear a bit of that argument about detail now.

COLIN KING (National—Kaikoura) Link to this

It is a privilege to stand and speak to the education estimates. After listening to that sort of machine-gun round-up by the Minister, I thought it was sad that he did not talk about the Correspondence School, because if he goes into the estimates he will see that there has been a $1.6 million reduction in funding for it. That is hugely serious. The Correspondence School has had a $1.6 million reduction in its budget, and in effect over 1,000 full-time equivalent students rely on that school. They have no other choice. The Correspondence School is iconic, and yet it has been treated rather shabbily by successive Ministers of Education.

Another point that I am really concerned about, and which I do not feel the Minister has come to grips with, is the fact that the supervisors, the people who take responsibility for ensuring that correspondence students do get their education—often the parents and the carers—are totally undervalued. They have not actually had consideration given to their contribution to students’ education since 1985. I would urge the Minister to seriously look at that issue, so that we do not have to do it when we are in Government. That is one point.

It is also very concerning, when the heart and soul of the Correspondence School are the parents, to see that as an incorporated society the parents association cannot be sure that it will be allowed to have a conference this year—it may not be able to have its annual general meeting. The association is completely dependent on how that money is dished out by the Correspondence School itself. That is a shocking situation. It disadvantages an enormous number of rural, isolated people and other people who choose to have their children educated by correspondence, be it because of their preference for special group education, and so forth. I just want to put that out to the Minister. I think he has completely missed the point. I do not blame him entirely. I blame the previous Minister, Mallard, who—

Dr PAUL HUTCHISON (National—Port Waikato) Link to this

It gives me great pleasure to speak on this vote. I believe that it is a very, very important vote, as was suggested by the Government back in 2005. This year the vote for the non-departmental budget was $644 million, but in 2005 in the Speech from the Throne the Governor-General said that science innovation, research and development, was critical to economic growth in New Zealand. What was extraordinary was that in the next Budget $1 billion—probably $1.5 billion—was put into the Working for Families project, which is a project that will cement in welfare dependency in New Zealand; another $1 billion was put into interest-free student loans, which will also cement in welfare dependency; and a mere $19.4 million was put into science research and development. So on the one hand the Labour Government was saying that research, science, and technology were critical to economic growth, but on the other hand it was doing very little in that area.

What we do know is that right throughout the tenure of the Labour Government investment into research, science, and technology, as a percentage of GDP, has remained the same at about 0.55 percent of GDP, when the OECD average is about 0.68 percent. The Minister might be sitting there thinking: “Ah, but this year we have invested, through one of the other portfolios, a significant tax credit to stimulate the private sector.”, but Labour has not done the fundamentals—that is, to ensure that we have a simple low-tax system to ensure that we have a flexible labour market and an optimal regulatory system. That is just as important in science research and development as it is in anything else. Both the Agricultural Compounds and Veterinary Medicines Act and the Hazardous Substances and New Organisms Act need review as scientists up and down the country are saying that there are blockages to their research or to their efforts to commercialise projects because of difficulties with those two Acts. There is no doubt that the whole regime, right from the very beginning—from basic research to commercialisation of science—is not operating optimally under this Government.

One of the things I particularly wanted to talk about is the huge compliance costs imposed on scientists in New Zealand at this time. A couple of weeks ago Professor Jacqueline Rowarth, who is a professor at Massey University, wrote how bureaucrats are taking a bigger slice of the research budget. She reported how Neville Jordan, the President of the Royal Society of New Zealand, had noted, in her words, that 60 percent of funding was being eaten up by the system. In actual fact I do not think it was quite as much as that, but certainly the figures were a substantial amount. The Ministry of Research, Science and Technology and the Foundation for Research, Science and Technology both say that their compliance costs are less than 3 percent, but it is the researchers themselves who are having to undergo enormous work to get a successful application through, and it is there that the costs are taking place.

There is no doubt that the system, as designed by Labour in the last 6 to 7 years, is, as the Minister admits, extremely inefficient. We should have a situation where the Ministry of Research, Science and Technology is a clear policy body, and the Foundation for Research, Science and Technology is an efficient, lean funder whereby compliance costs are kept to an absolute minimum. Yet in this country we have the reality of extraordinary compliance costs imposed on our researchers right throughout the country.

It is not only in the field of Crown research institutes and universities; we have just seen the fiasco with the centres of research excellence whereby under this Government only one new centre of research excellence was awarded tenure—I am not sure whether it was for 5 or 6 years—but only one centre, out of 26, received this award. It was regarded as an absolute fiasco by the Otago University vice-chancellor, Professor David Skegg. The next in line, Professor White, said that the weakness was in the process used to make the core selection, that much of the process was confused, and that aspects of the selection framework left them concerned. What I really think is that these are all examples of how this Labour Government has left us with huge compliance costs and inefficiencies in an area critical to our economy, an area that the Government itself has admitted is important, yet it has failed miserably.

CHESTER BORROWS (National—Whanganui) Link to this

It is interesting to look back from the last election to the present day at the current state of policing and at some of the issues that have arisen in this portfolio, given the promises that were made prior to that election. We know that prior to the last election, for instance, the National Party said: “We need to have a radical increase in police numbers. We think it will be about 1,000, but we will do it in consultation with the police administration.” Labour said: “Rubbish!”. New Zealand First said: “We think we need to take police numbers up by about half.”, so New Zealand First was going to have another 3,500 police members. Labour said that was rubbish. In fact, the Prime Minister said that anyone who was talking about lifting police numbers in the thousands was incredible. She reckoned those people were not even on the right planet.

The problem with that little assessment, of course, was that the public of New Zealand agreed that the police numbers needed to go up. In spite of all the assurances that have been given, and in spite of the assurances on pledge card after pledge card that youth crime would be dealt with and that burglaries would be dealt with, the fact is that that was not done.

So what happened when the issue gained some traction with the public? Well, Labour decided it would contribute 250 community cops. It did not do any assessment on that; it just sort of plucked that number out of the air and said it would contribute 250 community cops. There was no consultation. Then what happened? Well, in the words of Dr Cullen, I guess, they won, we lost, eat that.

But Labour needed a coalition partner, so it went along to New Zealand First and was pleased to speak to my colleague Ron Mark, and New Zealand First went into bat. Without any consultation Labour again came back to the public and said: “We’ll give you 1,000 more cops. That’s it, the coalition deal is signed, and we’re up and running as a Government.” The problem was, of course, that Labour never consulted the police administration as to how long it would take to get the recruits, how that would affect standards, what the flow-on effects would be for justice and the courts, and all the rest of it. That was all there was to it—1,000 new cops.

Well, what has happened since then? What has happened is that these 1,000 new cops were all going to be front-line cops. Initially, New Zealand First said they would all be front-line cops, and Labour said that it did not know about that, and that there would be support staff, and all the rest of it. Eventually Labour got its act together and said there would be 1,000 new front-line cops.

In response to question for written answer No. 8496 to the Minister of Police, we found out that of the first tranche of these 1,000 new cops—there were 353 of them—only a third would actually be front-line cops. One-third of them are recorded as being front-line general duties responders. Others are road police, some are Criminal Investigation Bureau and support staff, some are specialists, some are recruiters, some are analysts, some are prosecutors, some are working with Child, Youth and Family, and 27 are “other”, so they are not even described, at all. What they are not is front-line cops.

I wonder whether that is what Mr Mark actually thought he was getting when that deal was negotiated. But we cannot find any answers to the questions asked about correspondence between New Zealand First and the Minister of Police, as to where these front-line cops were coming to and where they were going. We asked: “Has there been any consultation between New Zealand First and the Minister?”. We got back the answer: “None.”

In recent days and weeks there has been a question over the quality of the recruits that are being brought into the Royal New Zealand Police College to make up these 1,000 police. I have to say that it really hacks me off that as soon as one even raises the question, one is seen as defecating on the New Zealand Police. Well I can tell members, from experience, that the New Zealand Police are tough enough to handle it, and it is interesting to note that the New Zealand Police are getting more concerned than certainly the Minister and anybody else.

Wayne Annan, who is the head of human resources in the New Zealand Police, says that the new recruits are fine, and that some comparative testing has been done between current recruits at the police college, recruits who are yet to arrive at the police college, and cops who are already serving, and everything is fine. Well, that study was reviewed by Senior Sergeant Iain Saunders, who seems to have been on a commissioned officers’ course at the police college. He found that there were a whole lot of problems with that. He found that the norm groups fluctuated, and in one statement he said: “We don’t even seem to know what we are measuring and predicting about the person or in the job, and we are just taking the best guess at present.” Well, that is flash!

Hon PHIL GOFF (Minister of Defence) Link to this

Chester Borrows came into this Chamber and said he wanted to talk about the current state of policing. Well, I will tell him something about the current state of policing in New Zealand: it has never been better. It is much better than when that member was a policeman in the dying days of the National Government, when the police numbers were not increased; contrary to the promise of 500 additional cops, National cut them. That is what it did; it cut them.

The then Treasurer, a guy by the name of Bill English—we have heard his name mentioned before—put in place a police review that was to cut 285 non-sworn members and 95 senior sworn positions. This is the man who is still the spokesperson on finance in the National Party. Members should judge him on what he did. Not only did he cut superannuation for the old folk but also he cut their protection by cutting cop numbers. Chester Borrows knows that. He knows that that is a fact. He knows that police numbers in 1999 were less than the establishment level in 1994—5 years in Government, and National cut police numbers. He knows that the then Commissioner of Police said to the select committee that police morale had never been lower, and that the police force in those days, under the National Government, was the most inexperienced police force since the Second World War.

So what a double standard it is that Chester Borrows comes back into this Chamber now and dumps on his mates in the police force for a bit of cheap political capital. I will tell Chester Borrows what the score is. The score is that last year we recruited 688 additional police officers.

RON MARK (NZ First) Link to this

I cannot allow the comments of Mr Chester Borrows to go unchallenged, because at the end of the day—and I think the comment has been made today—people will be judged not on what they say in this House, not on what they purport to do or say they are going to do, but on what they did while they were in Government, when they had the power, the authority, the ability, and the resources to do something.

It is interesting to hear the criticism over the lack of consultation with the police. Let me just say this to National Party members: the New Zealand First policy in the last election was to double the size of the police force; that is our policy. Over a period of time we intend to double the size of the police force. Given the opportunity to negotiate with the Labour Party, as an incoming Government, as to how we would take the first step to achieve that, we set a target of 1,000 extra front-line police on top of the 250 community service police that the Labour Government had already budgeted for.

It is interesting to hear Mr Borrows talk about the lowering of recruiting standards. The obvious question is whether the police would take an overweight policeman today—yes or no? Are there any overweight policemen in the force today? Yes. Why do the police continue, then, to discriminate against young recruits, when their leadership itself is demonstrating that it is not prepared to undergo the same physical tests that it demands of the young men and women under its command? The great thing about the Ministry of Defence—and Corporal Willy Apiata is a great example—is that people lead by example.

The message I have for any ex-policeman or any current policeman who proposes to be a leader of the police, either as a Minister or as a senior officer in the police, is to get his head around a couple of things. New Zealand First negotiated an extra 1,000 police. Why? Because we believe that is the minimum number that is needed. Our policy is to double the size of the police force, and I ask members not to underestimate our resolve to do that. I say to Chester Borrows that if he comes to the coalition negotiating table after 2008 and he is not prepared to talk about it, he should get out. If he is prepared to come to the coalition table, and he does not want to talk about increasing the size of the police force, he can get out of the room. Likewise, if he comes to the coalition discussion table and is not prepared to talk about crushing gangs, he should get out of the room, because we in New Zealand First would not be interested. If that man wants to be the Minister of Police, if he wants to be in a Government, if he wants to be at the Cabinet table, he has to get his head around the fact that 1,000 is a start.

Speaking of a start, we remind the National Party that 1,000 is only the first pick of it, and the Labour-led Government has agreed to increase recruiting so that by 2010 New Zealand has the same ratio of police per capita as Australia. The question I have for the National Party members is whether, if the Labour Government commits the Budget towards doing that, they will support it. Will the National Party members support it, or are they going to wait until they get into Government in 2008 and do what they did in 1990 and cut the police budget? Are we now hearing about all the inoculation spoken of in The Hollow Men; is the ground being preparedfor the public, so that when National says it will cut the police budget people are prepared for it?

Maurice Williamson is looking at me right now. I know Maurice Williamson because I was in Government when he was a Cabinet Minister. He will have no qualms about cutting the police budget, and neither will Tony Ryall, Bill English, Nick Smith, nor Chester Borrows, because that is what National members did in the past. If members look at this report and the financial review, they will see the one thing that New Zealand First members are pleased with, and that is the increase in police numbers.

The question we now have is whether the National Party will commit towards extending those numbers to give us the same ratio of police per capita as Australia, or will inoculate the public during the next 2 years in preparation for a welshing on, and a cutting of, the police budget. This is the party that pledged an extra 500 police. I ask Mr Borrows to let me show him the National - New Zealand First 1996 coalition agreement. Where was all that great consultation from his front-bench members then, when they agreed to the 500, as written on page 48? I ask him to read it; that is what his party signed up to.

So I tell him not to knock this initiative; it is what the country wants. For a party that is committed to law and order, the first thing it needs to do is to talk to Chief Bratton of the Los Angeles Police Department and to anyone who has seen the success of the zero tolerance policy. We have to have more feet on the beat if we want to make an impact on crime.

CHESTER BORROWS (National—Whanganui) Link to this

I turn to the report by Senior Sergeant Iain Saunders, the psychologist who is now a senior sergeant within the police and who works at the Police College. He made some conclusions in relation to recruiting within the police, and his concerns were these: “There are very real developing concerns with incoming recruit populations. No matter how you tint your view of the recent performance of police recruits in training, there is a noticeable growth in the tail of the population and the load being placed on training resources to get them through the course.” He established that there were four deficiencies within the recruiting system as it is at the moment. He says: “Recruit performance and training is”—in bold—“diminishing and has done so markedly since the introduction of the new testing and associated standards. The labour market did not abruptly change at this time nor did the education system or the recruit course measures presented.”

Then he said: “Data reported to recruit training is limited and commonly erroneous, hampering attempts to research recruit performance and training delivery outcomes adequately.” He went on to say: “To review norms periodically is desirable. For it to be as haphazard as it appears is not. This exposes police to risk of staying on thresholds at extremes creeping either up or down depending as to who is put into the sample.” At the end he says: “Criticism of the RTG”—recruit training group—“work in this field is founded on flawed and misrepresented data which has little credibility, leading to the suspicion that the executive are misinformed on the actual position with regards to recruit performance and selection.”

We have to wonder just where the Minister of Police was when that report was delivered to the police’s administration, because when she was spoken to in the media about it she said it was an operational matter and had nothing to do with her. In actual fact, the Minister of Police in that situation is standing in front of the public and holding the police to account, because that is her job. If she does not want to do that job, maybe she should look for something else. The fact is that that is her role. She cannot just hold her hands up and say it is an operational matter, so it has nothing to do with her.

I now just want to touch on another point: the whole issue around the issuing and distribution of the stab-proof vests. We know that the police were guaranteeing to their officers that they would have stab-proof vests and, as Mr Mark has previously said, that that was supposed to be rolled out over 12 months, by the end of 2003—

Hon PHIL GOFF (Minister of Defence) Link to this

There is a real trap that new members of Parliament fall into when they are given portfolio responsibilities they are not ready for, and that is to knock the organisations they are spokespersons for. Here is Chester Borrows, having spent many years in the police, now taking cheap shots at the police, and not just at the police hierarchy but in fact—

Hon TONY RYALL (National—Bay of Plenty) Link to this

We want the Minister of State Services, Annette King, to explain why she has humiliated the Labour Party in Government with her inability to get the trans-Tasman therapeutic products legislation passed through this House despite her repeated assurances that she had the numbers. I have to tell members that the people of New Zealand are pleased that this House will not be passing the costly, bureaucratic, and restrictive piece of legislation that Annette King wanted to foist on this country. We were not prepared to allow her to do that.

What an extraordinary day! Annette King is personally responsible, through her own arrogance, for failing to get the numbers to pass the bill—but whose fault is it? It is my fault. Whose fault was it at question time? It was Bill English’s fault. It was everybody else’s fault except Annette King’s. Let us go through the history of what has happened here. In 2003 the National Party made it absolutely clear that our position on that legislation was represented in a view that was contained in a select committee report. In 2005 the Parliament changed, but Annette King kept going, despite the fact that the numbers she had for her bill had disappeared. She kept going, and she kept spending public money, and it was not until the National Party wrote to her that she even thought she might have to talk to the New Zealand National Party in Opposition about trying to build some support for changes to the trans-Tasman therapeutic products legislation.

So a series of discussions was under way. We asked the Minister to address a number of concerns. She told us stuff that was not true. She told us stuff that could not have been true. We knew it was not true. How could we have reliance, when the Minister was not even telling us the full story about what was going on? We had some months of correspondence. We told the Government that what it was proposing was not enough to address the concerns that we had set out clearly 3 or 4 years earlier and in many, many letters to New Zealanders all around this country. Yet, without assured support in the House, Annette King and the Labour Party introduced the legislation last year, relying on the support of New Zealand First and United Future.

Then the bill went to the select committee, where opinion was split fifty-fifty, and it came back to the House. The Government, under the Minister of State Services, proceeded with a number of discussions to try to build more support, and it was looking at a deal with the parties that usually support it. It is not National that props up this failed, arrogant administration; it is United Future and New Zealand First. Then the Government entered into negotiations with ACT. If the New Zealand First position was so good, why did Annette King not bring it to the National Party? She never said a word to us. If the New Zealand First deal was so good, why did not Labour, ACT, New Zealand First, and United Future support it? That would have given the Government the numbers.

It is because the Government could not get its own people to support it that it finds itself in this position. The Government, which is propped up by the Greens, could not look to the Greens for support. Where is the Government’s haranguing of the Greens for not supporting this? It is all a smokescreen. It is all about blaming the National Party, when it is Annette King and the Labour Government that arrogantly thought they could push this regime on to New Zealanders. We said no; so has the country.

Instead of accepting responsibility for the huge embarrassment and humiliation that has befallen this tired and arrogant Government, Annette King wants to blame the people with whom she never shared New Zealand First’s arrangement. She wants to blame the people who have made it clear for the last 4 years what would be required. She wants to blame John Key, who said for months and months that if she took natural health products out of the legislation National would support it. But Annette King says it is all the National Party’s fault. Well, actually, it is Annette King’s fault, Helen Clark’s fault, and Pete Hodgson’s fault. It is the Labour Party’s fault. They do not realise that as a dying Government they can no longer rule this House with the arrogance they had previously.

If the parties that normally support this Government agreed with that trans-Tasman legislation, it would have been passed. But the Government could not even convince the parties it was in negotiation with. If the New Zealand First deal was that good, we would have seen the legislation passed.

Hon PETE HODGSON (Minister of Health) Link to this

I will make a few remarks on behalf of the Minister of State Services, Annette King. I begin by thanking the Green Party members for their involvement in the therapeutic products legislation. I thank them not for their support, because we did not have it, and certainly not for their opposition, but for their consistency. We knew where we stood with the Green Party. We did not agree with the Green Party at all, but the Green Party members always gave their views clearly and consistently, and I want to acknowledge that.

I want to thank and acknowledge the Māori Party for much the same reason. We always knew where we were going with the Māori Party members. They were easy to deal with in that respect, as Annette King reported.

Hon MAURICE WILLIAMSON (National—Pakuranga) Link to this

I once again thank the National Party whips for giving me a speaking slot somewhere between 4 in the afternoon and around 9 p.m., because, as the whips well know now, that is drive time in Auckland—up to about 9 o’clock—and people are locked, blocked, and stopped in their cars.

I want to focus on only one thing, because Annette King gave me the entrée to focus on this the other day in the House. She brought in a graph about spending on roading and then she realised that it was not as complimentary as she thought. She did not table it and she ran away without it. So I have had the graph drawn up again, and I will explain to people exactly what it means.

First of all, I will give a bit of a compliment—that is, I will say that the spending on roading for this Budget is excellent. There we go; we have finally got to a point where it is excellent. But what I am really, really getting a bit peeved with is Labour’s view that when National was in Government it did not spend anywhere near as much as Labour did, and that Labour has spent a lot more on roading. So I have gone back and I now have a graph here, and I want members to focus—and with it being the first day of televised Parliament, I hope it is showing off my make-up and my hairdo at the same time. But here is a graph and I hope that everyone can see it.

Members will see there are some blue bars, there is a purple bar, and there are some red bars. That is how much road spending, as a percentage of GDP, occurred during the 9 years of the previous National Government, and a part-year that National partly funded because we did the Budget for it before the 1999 election as it was a June year. Then the red bars are road spending as a percentage of GDP spent by the Labour Government. If we look at the last one, we see that, yes, it is good. Let us give some credit where it is due: the last bar has got to 1.18 percent of GDP. But I want the Committee to know that in the first 1, 2, 3, 4, 5 years—5 full years; not the first 6 months up to June, but the first 5 long, full years—of the Labour Party in Government, the actual total spending on roading was less as a percentage of the GDP of the economy than it was under any of the years of the previous National Government.

I hear Labour members say that spending has gone up. In fact, I made that comment on Radio New Zealand National when the Budget came out. I said that spending was up. But spending on roading is up every year. Annette King made a joke about it and said that I was wrong, that it was not true, and so on. But I have the graph here for members to look at, and members will see that the single line is actually the dollar funding, not the percentage of GDP. The single line is the amount of money spent on roading and—hello—it does drop, only once. Only in 1 year does the actual amount of money spent on roading drop—that is, during the first full year of the Labour Government. The only year that money for road spending dropped in absolute terms was the first full year of the Labour Government. So let us call this programme tonight Mythbusters. Let us get into busting the myth that Labour has spent more on roads.

I have been really struggling to get hold of a particular transport Minister, because I think that Labour has had more Ministers of Transport than we on this side have had hot meals, during its term in office. I think it is seven transport Ministers, or maybe eight.