Parliamentary debates: Wednesday, 19 August 2026

14:00

E te Atua kaha rawa, ka tuku whakamoemiti atu mātou, mō ngā karakia kua waihotia mai ki runga i a mātou. Ka waiho i ō mātou pānga whaiaro katoa ki te taha. Ka mihi mātou ki te Kīngi, me te inoi atu mō te ārahitanga i roto i ō mātou whakaaroarohanga, kia mōhio ai, kia whakaiti ai tā mātou whakahaere i ngā take o te Whare nei, mō te oranga, te maungārongo, me te aroha o Aotearoa. Āmene.

[Almighty God, we give thanks for the blessings which have been bestowed on us. Laying aside all personal interests, we acknowledge the King and pray for guidance in our deliberations that we may conduct the affairs of this House with wisdom and humility, for the welfare, peace, and compassion of New Zealand. Amen.]

No petitions have been delivered to the Clerk for presentation, no papers have been delivered to the Clerk for presentation, and no select committee reports have been delivered for presentation. No bills have been introduced.

14:01 · to the Minister of Finance

How is the Government helping New Zealand businesses to invest in productive assets?

To lift incomes and drive long-term economic growth, New Zealand needs businesses to invest in capital investment that increases their productivity. That’s why the Government introduced Investment Boost in last year’s Budget. Investment Boost allows New Zealand businesses to immediately deduct 20 percent of the cost of a new asset on top of normal depreciation. This tax change means more investment opportunities will stack up financially so more investments will be made. Treasury and Inland Revenue consider that over the next 20 years, Investment Boost will increase New Zealand’s capital stock, lift productivity, and lift wages.

Who benefits from Investment Boost?

A lot of people benefit when businesses do well, but let me quote from the regulatory impact statement for Investment Boost, which was prepared by Inland Revenue and Treasury officials: “Our view is the majority of the increase in national income from this policy would flow to workers and this increase would come from a combination of higher wages and higher employment, and we therefore expect that the benefits of this policy will be spread broadly across a wide range of New Zealanders.”

Is there a cap on the value of new investments under this policy?

No. All New Zealand businesses, regardless of size, are eligible for Investment Boost, and there is no cap on the value of new investments. New Zealand needs businesses, both big and small, to be investing in machinery, tools, farm equipment, technology, heavy vehicles, utes, industrial buildings, and other capital assets. [Interruption]

Sorry, people who want to converse across the House while a question’s either being asked or answered will be asked to remove themselves to the side galleries to continue the argument. The Minister may wish to start again.

Mr Speaker, thank you. All New Zealand businesses, regardless of size, are eligible for Investment Boost, and there’s no cap on the value of new investments or prescription of what can and cannot be eligible. New Zealand needs our businesses, both big and small, to be investing in machinery, tools, technology, farm equipment, vehicles, industrial buildings, and other capital assets. Those are the sorts of investments that drive productivity growth, job creation, and wage growth. An accelerated depreciation scheme that only applied, for example, to assets less than $10,000 in value might encourage some businesses to buy a laptop or a chair or a lamp. None of that is going to transform their business.

How much are New Zealand businesses saving from Investment Boost?

Investment Boost is expected to reduce taxes on New Zealand businesses by $6.6 billion in the first four years of the policy. It is a policy to reduce tax on New Zealand businesses. Now, that is not in itself the only point of the policy, which is actually to incentivise businesses to make productive investments which will allow the New Zealand economy to grow. It does show that any policy to remove Investment Boost would, effectively, be a $6.6 billion tax increase on New Zealand businesses. Furthermore, it would have a negative impact on capital investment, on productivity, and on wage growth. Anyone proposing such a policy should be upfront about the consequences.

14:05 · to the Prime Minister

Does he stand by all of his Government’s statements and actions?

Absolutely, and I just want to confirm for the member that this Government won’t be implementing a capital gains tax, a digital services tax, a business tax, a 45 percent top tax rate, an inheritance tax, gift tax, rentals tax, asset tax, land tax, streaming tax, or ute tax.

What day did he first become aware that members of his own team intended to challenge his position as Prime Minister?

We dealt with that issue last week. I’ve been very open about it in the media. I’ve talked about it, we’ve dealt with it, and we’re moving on.

Point of order. What the Prime Minister says to the media is irrelevant. My question to him was: what day did he become aware that members of his own team intended to challenge his position as Prime Minister? This does relate directly to his responsibilities as Prime Minister. He sacked a Minister as a result of it. Asking him when he first became aware of that is not unreasonable.

And his opening answer was “Early last week”, and I you can’t deny that addresses the question.

Point of order. [Interruption]

Hang on. Sorry, it’s a point of order. [Interruption] The Hon Chris Bishop. No one else speaking at this time.

The Prime Minister is responsible for his actions and statements as Prime Minister. Issues to do with political party matters are not the responsibility of this House.

Well, unfortunately, there was a consequence that was taken as Prime Minister that has led to the question.

Did he receive an assurance, between learning of Chris Penk’s challenge and his decision to call a National Party caucus meeting, that Erica Stanford continued to support him as Prime Minister; if so, how was that support conveyed?

Point of order.

That’s all right. That does go straight to the heart of a party matter.

Point of order. The Prime Minister can only be the Prime Minister if he enjoys the confidence of the House. Asking questions about that is absolutely within his purview as Prime Minister. He has sacked the person who I questioned him about. It is completely reasonable to question him about that.

If your position was correct, then you’d need to ask that question about absolutely every member in the House. The Prime Minister sits in that seat because he clearly has the confidence of his caucus.

Point of order. That’s exactly the point. You’re asserting something that has not yet been established. Questioning him on whether or not he does actually have the confidence of his own Ministers, therefore, is totally in order.

I just want to make it absolutely clear that if there was to be any change in the leadership of a party, it’s done so by a caucus, not by individual Ministers.

If Chris Penk was acting alone in trying to remove him as Prime Minister, which resulted in him being sacked, why did he need to call every National MP back to Wellington to vote on it?

Point of order.

People are going to listen to points of order silently, or otherwise they’ll be listening to it on the broadcast.

The Leader of the Opposition is cleverly, but wrongly, conflating two separate issues in attempting to ask questions about matters to do with the National Party caucus, in Parliament where the Prime Minister sits as the Prime Minister. Those are not admissible questions.

That is correct.

Point of order. He sacked Chris Penk as a Minister, who basically challenged him, and said that Chris Penk was acting alone. It is completely legitimate to question the veracity of that claim. It resulted in a Minister being sacked.

No, they’re two entirely separate things. One is you have party caucuses choose who their leader is. The second thing is that if that party is in Government and is the dominant party, then clearly that leader will become a Prime Minister. Ministers serve at the courtesy of the Prime Minister, and while you may wish to conflate two different things, I think the ground’s been well gone over as to why the Minister concerned was relieved of his portfolios. It’s not tenable for—

Supplementary.

OK, I won’t go further. Good.

All right—thank you, Mr Speaker. Did any other Minister in his Government indicate that he should stand down as Prime Minister during the last two weeks; if so, why didn’t he sack them too?

As has been reported, Chris Penk was the only person to challenge for the leadership; he was working for himself. I have to say, this is a pretty sad and petty—

Point of order.

No—excuse me, sunshine.

No, no. OK. Woah. Point of order, the Rt Hon Chris Hipkins.

It’s a very straightforward question, Mr Speaker. It was completely consistent with the ruling you’ve just made. It’s whether or not a Minister in his Government asked him to stand down; and if so, why they’re not being sacked. He is responsible for that; it does relate to his job as Prime Minister.

The answer is no. Chris Penk was the only one.

The answer’s just been given.

Was Winston Peters correct when he said National’s leadership and MPs are “inexperienced, egotistical, and self-obsessed”; if not, how does he explain their behaviour to twice try and remove him as Prime Minister?

No. I think he may have had his Chrises mixed up.

The Hon David Seymour—[Interruption] Wait a minute, just wait.

Is it important for his Ministers—[Interruption]

Sorry. Wait. Even the loud laughter from the back could end up being an early afternoon.

Is it important for his Ministers to update their conflict of interest register, and would he sack one who failed to do it after being reminded 14 times?

No. I don’t think that helps with things.

If standards of ministerial conduct are that important to the Government, why hasn’t he sacked two Ministers who have been repeatedly racist?

Well, I just want to say, look, the member is—it’s very flattering; he’s got very obsessed with me. I have to say, Amanda’s getting quite jealous. I think this election is about tax; he wants to make this election about me. That’s perfectly fine, but I think it’s pretty sad and pretty petty, to be honest. [Interruption]

When we’re all settled. Question No. 3—Jenny Marcroft. [Interruption] Hang on a minute—there’s one person on the question.

14:12 · to the Associate Minister of Health

What recent reports has she seen on aged care?

This Government established a ministerial advisory group to review aged care. The Aged Care Ministerial Advisory Group has delivered their independent report that sets out what they believe is needed to create an aged-care system that provides the right care in the right place, ensuring people can transition between the type of care they need when they need it. In addition, the group focused on the changes they believe need to be made to make the aged-care system fairer and more sustainable. I would like to commend the group for their exemplary work on this report. They were given a huge task, and the amount of work they put in to deliver the 40 recommendations is admirable.

Why is this report important?

A proper aged-care system is a key part of ensuring people live as well as they can as they age, and I’m proud that this Government is actually looking at ways to build that. We’ve known for a long time that aged care isn’t set up as a system and it has funding challenges. For too long, Governments have been kicking the can down the road. Aged care has been a priority for this Government, evidenced by the New Zealand First - National coalition agreement commitments: to engage openly and constructively with the aged-care sector, investigate funding options for residential care beds, undertake a select committee inquiry, and work to support bipartisan agreement on the funding needed for care beds into the future. The ministerial advisory group report provides a vision for a pathway forward, and I hope all parties in this House would consider it to be a good starting point for building a long-term solution.

What is being done in response to this report?

As I’ve said, the future of aged care is incredibly important—for those in care, their families, everyone who might be in care, the sector, and the wider health system. They also involve significant sums of money. We need to get any change right. That’s why the report and its recommendations will be considered carefully by this Government. Cabinet has directed the Ministry of Health to develop advice for the Government on the recommendations, including on options for the timing and process of aged-care reform. This will cover immediate and longer-term priorities into the future.

14:15 · to the Prime Minister

E tautoko ana ia i ngā kōrero me ngā mahi katoa a tōna Kāwanatanga?

[Does he stand by all of his Government’s statements and actions?]

Yes, and particularly I want to reassure the member that this Government won’t be implementing a 45 percent top income tax rate, an inheritance tax, a gift tax, a rentals tax, or an asset tax.

When he said, and I quote, “I thought the Greens’ announcement was sort of a bit of classic Greens, to be honest, in the sense of we haven’t even got the investment here in New Zealand. We haven’t got data centres happening at scale.”, was he unaware of the hyperscale artificial intelligence (AI) Datagrid data centre being approved—the very context of the Greens’ announcement?

No. My point was that we’ve got about three data centres coming on stream in the next year, if everything goes to plan. Current data centres are about 0.6 percent of New Zealand’s electricity generation, Australia’s about 2.2, and I think Ireland’s 22 percent.

So, then, does he stand by his statement that “we’ve got about three data centres, I think, expected to come on stream in the next year. The advice we’ve had is that it won’t put upward pressure on electricity prices”, and, if so, can he confirm that this advice explicitly excludes the AI Datagrid centre?

In answer to the first leg of the question, yes.

So can he guarantee that the 280 megawatt Southland data centre will not push up electricity prices for households and businesses?

Well, actually, a lot of data centres that have come into New Zealand actually support additional generation and investment. If you think about the Microsoft one that’s been backed by Contact, think about the AWS one backed by Mercury, think about the Datagrid Southland one backed by Mercury as well—I’m just saying to the member that we agree that there should be some sensible rules. We certainly think there should be additional generation put in place. There’s a number of things that we can work through to get a code in place to get some common, sensible rules, but I just want to reassure the member that we need data centres for a modern life in New Zealand. We want to take the opportunity. That’s what we’re going to do.

So how does the Prime Minister reconcile his agreement with us that we need “sensible, common-sense rules” in place for hyperscale AI data centres with his willingness to continue allowing hyperscale AI data centres to be consented under current rules before sensible, common-sense regulations can be put in place, meaning that those consented AI data centres will not have those rules apply to them?

My point was that the Greens want to turn off investors and investment before they have even arrived in New Zealand. They want to put up a “closed for business” sign. We went through that experience on oil and gas and it wasn’t pleasant. I was just saying to the member that we have about three coming on stream in the coming year. We believe in some sensible rules, and we’ll get those in place in due course.

Has there been any evaluation whatsoever on the impact on energy prices if his Government’s investment arm strategy of $35 billion more invested into hyperscale AI data centres is successful before sensible, common-sense rules can be put in place?

Well, I think the member would fully support the actions of this Government that have led to a 35 percent reduction in wholesale electricity prices because of our desire to make sure we have a liquefied natural gas import facility, we have a strategic coal reserve, we have a strategic diesel reserve, and we’ve built more renewables in the last two years than we have in the previous eight.

Point of order, Mr Speaker. [Interruption]

A point of order and no one else making any comment.

I understand that the rules of question time are not that the Prime Minister obviously has to answer the question, but at the very least I understand he is supposed to address them. My question was specifically and explicitly about whether the Government had requested any advice on the impact on energy prices of hyperscale AI data centres. He did not address that.

The Prime Minister may wish to make another comment.

Yeah. Look, the Ministry of Business, Innovation and Employment advises that if current data centre growth continues as expected, there should be no upward pressure on electricity prices. This is also a Government taking the energy needs of New Zealand very seriously. That is why, actually, a 35 percent reduction in wholesale electricity prices is a good thing for New Zealand and New Zealand businesses.

Has the Prime Minister heard Anthony Newley’s song “Stop the World—I Want to Get Off”, and could that possibly be a political party’s manifesto?

No.

14:20 · to the Minister for Women

Does she stand by her statement that “The Government is committed to supporting women”; if so, why?

Yes. This Government is committed to supporting women through practical actions. Just yesterday, we announced further support for women living with endometriosis by introducing guidelines to help doctors and clinicians diagnose the condition. We’ve also expanded free breast screening to the age of 74. We’ve introduced KiwiSaver Government contributions for eligible parents receiving paid parental leave in Budget 2026, and we will continue to invest in initiatives that support women’s leadership, wellbeing, safety, and economic participation. [Interruption]

Just wait for the House to gather itself. Just keep waiting. The Hon Carmel Sepuloni.

Was the Government supporting women when it changed the law under urgency, cancelling 180,000 women’s pay equity claims and blocking secondary school teachers from making future claims?

As has been traversed more times than I can count in this House, I am not the Minister responsible for the pay equity changes. However, this Government remains committed to progressing pay equity through a system that is clearer, is targeted, and is sustainable in the long term. Pay equity is important—

How much?

—but it is just one part of the picture.

Show us the money.

Women’s overall economic outcomes are influenced by a broader set of economic and social factors.

The Hon Megan Woods.

I’m not Megan Woods, Mr Speaker.

Well, you could have been confused with the amount of questions coming across the House during that last exchange. The Hon Carmel Sepuloni.

Was the Government supporting women when it blocked proposals to introduce cross-party legislation to change our consent laws so the National Party could score political points?

I have no responsibility for that legislation.

Point of order, Mr Speaker. In the Minister’s answer to the primary question, she rattled off a number of areas that the Government, she proposed, had supported women in, so I believe I can ask about a range of things across sectors involving women, because her job is to advocate on behalf of women, as the Minister for Women.

That’s an interesting prospect, but there will be some aspects of Government activity that involve all Ministers; the Minister for Women pointing to those is not unreasonable. To ask specific questions about those I think is probably taking it a bit too far, but ask the question again.

Was the Government supporting women when it blocked proposals to introduce cross-party legislation to change our consent laws so the National Party could score political points—

See, the last part makes it very difficult for a Minister to answer without making some political statements. You’ve got to ask what exactly you want.

Was the Government supporting women when it blocked proposals to introduce cross-party legislation to change our consent laws?

I do reject the characterisation of that question, but what I would say is this Government is working really hard to improve safety for women. Just last month, I launched a practical guide to help employers and workplaces support staff experiencing stalking. That launch actually coincided with the Government’s introduction of new anti-stalking legislation, which recognises stalking as a harmful pattern of behaviour that carries a maximum penalty of five years in prison.

Was the Government supporting women when it removed 53,000 families from receiving BestStart childcare tax credits and cutting the payments for another 9,000 families?

I have no legislative responsibility for that.

Was Nicola Willis correct that the reason paid parental leave is not currently 30 weeks is because the Minister for Workplace Relations and Safety “didn’t prioritise this change in her work programme”, and, if so, why didn’t she prioritise these changes in her women’s portfolio?

I’m advised that that is not what the Minister of Finance said, and I’d suggest that member put those questions in writing to the relevant Minister.

Point of order, Mr Speaker. Paid parental leave is one of the areas that the Minister did cover in her opening answer to my primary question, so I think it’s fair that I am able to ask a supplementary question on that specific area.

Yes, and it’s also fair that the Minister says she’s not able to answer on that. Do you have another supplementary? OK, question No. 6—Dr Carlos Cheung.

14:25 · to the Minister of Housing

Is the Government considering removing interest deductibility on residential property?

No.

How does interest deductibility on residential property work?

In New Zealand, tax is paid on profit, not revenue. That mean residential property investors can subtract mortgage interest they pay, and other expenses like council rates, from their rental income. Take a simple example: if a rental earns $30,000 a year; rates, insurances, and repairs comes to $8,000; and mortgage interest is $20k, with deductibility, the taxable profit is $2,000, and tax is about $660, and without it, the tax is about $7,260—on a property that only actually made $2,000 profit. This is a great way to disincentivise people from renting out their property. The Government supports the principal that you pay tax on profit—as it does with any other business.

Why isn’t the Government considering removing interest deductibility on residential property?

Many reasons, but here are three. For one, removing deduction is unprincipled because it violates a fundamental principal of tax law. Secondly, it’s inconsistent and can therefore create perverse incentives. Thirdly, removing interest deductibility raises cost for people who provide rentals, which—according to experts—is likely to be passed on to renters. It is perhaps unsurprising that between 2017 and 2023, rents went up by $180 per week, and they are now flat, and in some markets falling.

What do experts say about removing interest deductibility on residential property?

Let me quote from the regulatory impact statement. IRD said that they were concerned that denying interest deduction would make rental investment unattractive, reducing supply over time, placing upward pressure on rents, thus raising costs for renters. Dr Oliver Hartwich said that calling interest deductibility a loophole “misunderstands how an income tax works. … No Government would dream of taxing a farmer on gross sales while ignoring the cost of feed, fertiliser and fuel. Yet that is precisely the logic applied to landlords.” Even noted tax expert sir Deborah Russell said it would be an arbitrary rule, designed to achieve a non-tax purpose. I agree with Deborah Russell: we should keep the law as it is.

14:28 · to the Minister of Finance

Mālō ‘aupito, Mr Speaker. Does she stand by all her statements and actions?

In context, yes.

Does she stand by her claims, in 2024, that New Zealand is seeing the green shoots of recovery, when, on her watch, business liquidations are up 70 percent, with 3,023 placed into liquidation in the year to March?

Yes, but I would also note that the number of new businesses registered outpaced those liquidation figure in those recent statistics as well.

Is the cost of living getting better or worse when there was $43.4 million of KiwiSaver hardship withdrawals in June alone, up almost 20 percent in just one year?

The latest data that we have on inflation—which of course is the biggest driver of the cost of living—shows that food prices, and food inflation, has continued to ease. Food prices increased just 0.1 percent in July, meaning that annual food inflation has fallen to 1.9 percent, which is its lowest rate since December 2024—and a lot lower than the double-digit food inflation experienced under the last Government.

Why, then, is there $43.4 million of KiwiSaver hardship withdrawals in June alone, if inflation was just the issue?

I do want to acknowledge that anyone who is put in a position where they feel they have to withdraw their KiwiSaver funds is someone that I have a lot of sympathy for, and that is not a situation that we want to see happening readily. Of course, the question is: what do we do to ensure that fewer Kiwi families are in that situation? Our Government’s answer is to ensure that we are fuelling economic growth that drives wage growth and job creation—whether that’s fast tracking major projects, whether that’s the Investment Boost tax credit to promote investment and wage growth, and whether that’s reducing red tape, these are the sorts of policies that support a stronger set of economic outcomes for all New Zealanders. The reverse is also the case. If we were, for example, to impose billions of dollars of new taxes across the economy, that would send a wrecking ball through the hopes and aspirations of Kiwi families.

Why, then, with record net migration, higher unemployment, and low growth—while Kiwis are doing it tougher—has her Government resorted to calling them and New Zealand businesses “bottom feeders”, “soft”, “impatient”, “C-listers”, and “wet”, “whiny”, and “inward looking”?

I reject the latter part of the question, but I would simply point out this: the people who stand in this House and say they are on the side of everyday workers better be consistent with their policy positions, because if those are the same people who are saying they want to whack $5 billion worth of additional tax on businesses who are striving to increase wages and increase jobs, and if those are the same people who will oppose fast-track developments—

Yup, that is enough.

—creating jobs, then those peopleare not on the side of growth.

14:31 · to the Prime Minister

E tautoko ana ia i ngā kōrero me ngā mahi katoa a tōna Kāwanatanga?

[Does he stand by all of his Government’s statements and actions?]

Yes, and I just want to reassure the member that this Government won’t be implementing an asset tax, a rentals tax, a gift tax, an inheritance tax, or a 45 percent top tax rate. We think that would take New Zealand backwards.

Do hospitals have safe staffing levels?

Well, I’m very proud of what this Government has delivered, with 2,100 extra nurses and 600 extra doctors in our healthcare system, a big outreach to nurses to invest in nurse prescribers and nurse practitioners, and a big investment in primary care. I think we’ve got more to do in healthcare, but we’ve made some very good progress.

Is he proud that three nurse roles in neonatal intensive care in Wellington were not approved for six months, or that chemotherapy treatments had to be shut down from not having enough nurses to provide treatment due to deliberate delays in approving hires for vacant roles?

What I’m proud about is that, actually, this is a Government that’s invested more money into healthcare, it’s a Government that has invested more in workforce into healthcare, and, importantly, the healthcare system is starting to improve on the five key targets and metrics that we’ve set it. We have a real challenge with the bureaucracy in the middle, but we’re making progress on that too, and I’m sure the member would want to support less bureaucracy in healthcare so that we can get funds and people out to the front line.

How can he be proud of his promise that front-line services wouldn’t be impacted by Public Service job cuts when we are hearing from workers in the system that “We are required to quietly cut and restrict services in order to prevent waiting lists from blowing out.”?

Well, I’m actually proud of the fact that we’ve set targets and—

Point of order, Mr Speaker. Where was the proof behind that allegation in that question?

I beg your pardon?

Where was the proof or evidence behind the allegation in that question?

There doesn’t need to be.

Yes, there does.

No, there doesn’t.

You can’t say anything you like in here.

I’m sorry, but there doesn’t. We’re going to have the question again.

How can he be proud of his promise that front-line services wouldn’t be impacted by Public Service job cuts, when we are hearing from workers in the system that “We are required to quietly cut and restrict services in order to prevent waiting lists from blowing out.”?

What I’m proud about is that this Government is focused on health outcomes, and we have prioritised on making sure we have shorter wait times in emergency departments, we’ve made sure that we get immunisation rates for under-twos focused, and we’ve made sure we’ve got access to first specialist appointments, elective surgeries, and faster cancer treatment plans. On all of those metrics, we’re making progress. That matters because we want to see things and outcomes improve for patients.

Has a single nurse told him that there are safe staffing levels in front-line hospitals?

Well, I can tell the member they certainly appreciate having 2,100 more nurses in the system than when we came to Government.

14:34 · to the Minister for Media and Communications

Is he considering implementing a streaming tax?

14:35

No [Interruption]

No one else is talking.

What would a streaming tax mean for New Zealand consumers?

Well, any tax imposed on streaming platforms would ultimately risk being passed onto consumers—the people who are trying to watch Netflix, or Apple TV, or whatever it is. The Government’s view is that New Zealanders pay enough tax already, and the last thing that we need is even more taxes, so that is why we’re not going to be adding to the pile of taxes that New Zealanders pay, and part of that is being careful about our spending and that means we don’t have so much tax.

Instead of a streaming tax, what is the Government doing to support local content?

Nothing.

Well, a large amount and, rather than taxing viewers—

Does Willie still want a tax?

—and I acknowledge my counterpart Willie Jackson who is—[Interruption]

No, look, I’m sorry; one Minister answering only would be useful. Start again.

I do acknowledge the member Willie Jackson, who is obviously upset about not having this tax, but he lost the argument, I presume. What the Government does invest is more than $400 million a year in the screen sector, including $85 million a year for NZ on Air, and around $280 million through screen production rebates. Also, this Government is moving legislation to improve prominence on new television sets that turn up. We’ve also removed Sunday advertising restrictions in order to help the broadcasters. There’s been a lot of work done to help New Zealand local content, but we’re not going to be adding new taxes.

Has he seen any recent proposals for a streaming tax?

This needs to be very carefully answered.

Well, as we discussed yesterday, there was a member’s bill and it did refer to a “small levy” on these giant streamers that will create a substantial revenue stream. The only point I’d say is this: things can start small that become big. If we look at Canada, for example, a 5 percent tax was introduced and then—lo and behold—it was 15 percent. The first series was at 5 percent and the next series was at 15 percent, so there’s always a risk when taxes and levies are introduced that they will continue to expand. We’re not going to take that risk, and that’s why we’re not having a streaming tax.

14:37 · to the Minister of Health

Is it correct that the net increase in Health New Zealand full-time equivalent nursing staff between the quarters ending March 2024 and March 2026 is 54 fulltime-equivalents?

14:38

In respect to the member’s question, all of this information is published, and I refer the member to Health New Zealand’s Health Workforce Information Programme (HWIP), which reports on the growth of our healthcare workforce every single quarter. I’m advised that it shows Health New Zealand now employs 2,162 additional nurses on a net basis compared with September 2023, which equates to a net increase of 1,640 fulltime-equivalents (FTE). There are more nurses working in our public hospitals today than in previous years. Those are Health New Zealand’s own published figures and they’re freely available. That work has not stopped. I’m further advised that as at 28 July 2026, advertising for Health New Zealand nurse roles was under way for 1,422 FTE, with a further 297 at interview stage, 154 at reference-checking stage, and 235 offers under active consideration by candidates.

Point of order, sir. This is a very similar circumstance that occurred previously with this exact same Minister: with a primary question on notice that gives a specific time frame, he deliberately chose not to answer that question and talked about something of his own choosing. The primary question on notice specifically asks between the period of “March 2024 and March 2026”, neither of which he responded to.

Well, I’m not sure about that, to be quite frank with you. I was listening very, very carefully for some of the reasons that you’ve outlined earlier. I think the Minister gave a very comprehensive address to the question.

Point of order, sir. The Minister talked about a time period before that in the question, and a time period after that in the question. Speakers’ rulings are quite clear that for primary questions on notice, they should be addressed to a more correct standard than is required for supplementaries. If that were to be a supplementary question, then yes, indeed, it would have been addressed. But if we have a situation where Ministers can choose to answer whatever time frame they wish, what is the point in question time if they’re not required to respond directly to primary questions on notice?

Well, I’ll take this a bit further, but the question does actually state a specific outcome and asked him to confirm it. He clearly didn’t. The Minister may make a further comment on this answer.

As I said in my answer, the number is publicly referred to and available in the Health Workforce Information Programme, which reports on the growth of the health workforce every single quarter.

That’s not a—I would have thought that while you can’t be asked to give a yes or no answer, something more specific about the two dates that are mentioned there would be helpful to the order of the House.

Yes, well, the answer to the question, as I said, the number is available. It is published in the Health Workforce Information Programme for the quarters ending 24 March and 26 March, at that number of FTE.

You can’t give an answer that leaves the House none the wiser. None of us have that information in front of us, and I presume the Minister does.

And I said the number is publicly available in the Health Workforce Information Programme for those two quarters at the FTE stated in the parliamentary question.

I think that was a yes.

Well sir, with respect—point of order.

The Minister just said it is as stated in the parliamentary question. Can’t get clearer than that.

Point of order, Mr Speaker. The Minister referred in his answer to the primary to HWIP data, which is not in a parliamentary question answer. That is published data by Health New Zealand, so it would be incorrect for him to refer us to a written parliamentary question answer, and I think the question remains unanswered for that reason.

No, no. The way I just heard it is the Minister actually said that the number is correct as stated in the question.

Point of order, Mr Speaker. I think maybe I could be a little helpful here. The Minister did appear to be quoting from an official document. Therefore, I’d ask that he table it.

Is the Minister quoting from an official document? He appears to be not.

Then how can he claim that, then?

It’s published; it’s online.

No, hang on—no, no need. Thank you.

Is the answer to my primary question “54”?

Yes. [Interruption]

The Hon Dr Ayesha Verrall, no one else.

Why did he say nursing vacancies reduced by referring to a different time period from the time period specified in my question on 28 July?

Well, because the member is cherry-picking a set of dates. The reality is I, in my answer to the question, talked about when this Government came to office and what the numbers are now. That member needs to take actual note of the answers that I am giving. As I said, I’m further advised—because at the heart of this question is: is the Government focused on recruiting the nursing workforce New Zealand needs? In my primary answer, I said we have 1,422 nursing roles currently being advertised, a further 297 at interview stage, 154 at reference-checking stage, and 235 offers under active consideration by candidates. I’d also note that the number of vacancies in September 2023 was 2,632; that is now down to 1,601. The turnover rate has dropped from 11.7 percent to 8.4 percent. The vacancy rate has fallen from 8.6 percent to 5.2 percent. The workforce is being strengthened under this Government.

Why did he cite, on Q+A, the nurses hired since coming into Government when nearly all of that growth happened before the election, and nursing fulltime-equivalents has grown by just 54, as he conceded today?

I’m not sure if she remembers, but this Government came to office in October 2023, after the election, and the number of nurses that have been employed by Health New Zealand is 2,162 additional nurses since September 2023, which equates to a net increase of 1,640 fulltime-equivalents. Those are the facts.

Can he explain—[Interruption]

Everyone, just calm it.

Can he explain to New Zealanders why released documents show he knew about the hiring freeze all along and he has been deliberately deflecting answering questions about it in the House and in media?

It was a document that was provided to RNZ from the PSA, which is a union campaigning for a change of Government, from March last year, when I’d just become the Minister of Health. Since then, we’ve got a new board, we have a new CEO, and we have established devolution, devolving decision making back down to the regions and districts where recruitment should take place and unravelling the mega-bureaucracy put in place when she was Minister of Health. [Interruption]

Just a minute. That general barrage has to stop, or the questions will stop.

Why doesn’t he come clean and admit there has been a hiring freeze at Health New Zealand since the moment he has been Minister?

There is no hiring freeze at Health New Zealand. In fact, the facts speak for themselves, and there are currently 1,422 nurses—[Interruption]

We’re going to hear the rest of this without having comment from any other part of the House.

There are 1,422 nurses currently being advertised at Health New Zealand; 297 at the interview stage, 154 at the reference-checking stage, and 235 offers under active consideration by candidates. This Government is having to unravel the complexity of the bureaucracy put in place by the previous Government when they decided—

That’ll do. [Interruption] That’s enough.

14:48 · to the Minister of Agriculture

Are the Government’s tax policies supporting the primary sector to grow; if so, how?

The Government’s tax policies are supporting the primary sector to grow, as it hits a record $64 billion in exports this year. For example, the Government’s Investment Boost tax policy has allowed the primary sector to invest in their businesses and grow production. A tax expert said this Government policy reduces costs of capital investment, making it easier for agribusinesses to grow. A rural accountant has said it rewards forward-thinking businesses that are upgrading gear, reducing risk and improving output. New Zealand does not grow by taxing more and investing less. Investment Boost is an important part of lowering taxes and boosting the rural economy.

What reports has he seen about how the Government’s tax policies are supporting the primary sector to grow?

Investment Boost is driving investment across plant and machinery, vehicles, irrigation, and environmental practices, which is driving regional growth. There are reports of this being a game-changer for rural New Zealand. Pumps and irrigation, for example, immediately have a 20 percent tax deduction under Investment Boost. As the member will know from her electorate of Rangitīkei, water distribution enables greater productivity on farms. Without Investment Boost, significant harm would be done to rural businesses and the rural economy.

Has he seen any other reports about how the Government’s tax policies are supporting the primary sector to grow?

Yes. Earlier in our term, we removed the ute tax, that unfairly penalised farmers, foresters, and growers. At the time, Federated Farmers said, “Taxing farmers in this way only added additional cost to productive businesses for no material advantage.” A commercial vehicle lease and finance company reported many tradies and farmers telling them that the ute tax unfairly penalised them from needing a rugged and practical work vehicle, and there was a rush from tradies to buy new utes when it was taken away. And, Mr Speaker, you will remember, as I do, when Groundswell organised a nationwide howl of a protest: 60,000 people turning up to say no to the ute tax—

Just don’t bring me into your answer.

I apologise. I thought I saw you at it. I’ll stop now.

That’s wrong—yes, carry on.

A return of this tax would harm every farmer, every grower, every trader in New Zealand.

Has he seen any other reports about the effects of taxes on the agricultural sector?

Well, yes, I’ve seen media reports about an intention to scrap Investment Boost and to bring back the ute tax, and this would be devastating for the farming sector. It would impose a tax on tradies who need a ute for work, or farmers who need one to run their farms. The reports referred to a senior Labour Party candidate in Mt Albert, Michael Wood—

That’s good. No, leave it there.

14:51 · to the Minister for Seniors

Is it still the Government’s plan for its policies to reflect the “reality” that “older people are a vital and growing part of New Zealand’s workforce, economy, and communities”?

Yes, particularly in the context in which that quote was made, off the back of the latest New Zealand Institute of Economic Research business of ageing report, produced for the Office for Seniors. The report showed that the value of unpaid work by older people has passed $20 billion a year; the paid work by over-65s contributes around $9 billion a year; self-employment for over-65s adds a further $5 billion a year; older people pay more than $13 billion in tax a year; and consumer spending by over-65s is close to $55 billion a year. Everyone knows that older New Zealanders make an incredible contribution to our society, and the business of ageing report puts some serious numbers behind that contribution.

How is it so that her Government values seniors when 51,000 seniors report costs as a barrier to seeing their GP?

Absolutely this Government recognises that those that are on fixed incomes, relying mostly or exclusively on superannuation, are doing it tough. That is why this Government is approaching aged-care reform to ensure that we invest in keeping people well and improving access to aged care, and, most importantly, that we grow our economy. What we won’t do is put a capital gains tax on our older seniors, to ensure that they have a lower cost of living.

Do seniors’ greater health needs and vulnerability to the cost of living make them less or more impacted by GP costs?

As I’ve just said in my previous answer, those older New Zealanders that are impacted by fixed income will of course do it tough, and we are doing the practical things to ensure we reform our aged-care system to improve access, to improve the quality of living for our older New Zealanders. One of the things that is important to note is that when we saw a problem, we actually looked to reform the aged-care system, not appoint an Aged Care Commissioner to commentate on the problems.

Does she accept that when cost causes seniors to delay seeing their GP, health problems can worsen and ultimately require expensive hospital or even emergency care?

Absolutely, which is why I’m so proud of the aged-care report produced by the ministerial advisory group that addresses just those points. That is why we have sought, under the New Zealand First - National coalition agreement, to seek bipartisan agreement to improve the system. We will continue to work on that because, on this side of the House, we are the party of solutions.

Will her Government commit to providing seniors with three free doctors visits per year; if not, why not?

Having traversed, quite at length, the challenges of accessing a GP appointment in the first place, promising three free GP visits to everyone, regardless of whether they need it or not, puts an added drain on the system. What I’ve said, repeatedly, is we want practical solutions that are delivering, that will improve the health outcomes for older New Zealanders.

Will her Government commit to providing all New Zealanders with three free doctors visits per year; if not, why not?

What we will commit to is improving health outcomes for New Zealanders. Access to good care, access to early diagnosis, access to surgical treatments—that is what we will do, and we will ensure that is delivered by this Government.

14:56

Point of order, Mr Speaker. There was a report in the media recently where the Minister has not committed to amending the legislation. She has not given a time frame for that, and it will potentially be in the next parliamentary term, so we won’t have the ability to debate this when the legislation comes to the House, because she hasn’t committed to that.

Well, thank you for pointing out your view on that matter. It’s not changing my opinion.

If people want to leave the House, do so.

14:57

I move, That the House take note of miscellaneous business.

Here we are, 80 days or so out from the general election, and MPs are rightly talking about how we address the challenges New Zealand faces. There, on the Opposition benches, they never saw a problem they didn’t think they could solve with somebody else’s money. When there’s a problem that needs solving, the left are here, and their answer is new taxes. The list of new taxes is growing. First of all, we’ve got that old chestnut, the capital gains tax—that’s on the table. Then we’ve got an asset tax—Chlöe Swarbrick put that one on the table—and an inheritance tax, because why not tax death? You can tax people till they die, then tax them when they’re dead too. Then we’ve got a higher tax rate because why not scare off all the doctors and engineers and tell them to head on the first plane to Australia? Why not have a gift tax and a higher corporate tax rate—why not tell all the businesses to shut down?—a digital tax, a rentals tax so that the tenants can keep paying through the nose, and a land tax too?

Now, that’s the list of new taxes I’ve assembled, but I have to admit that it’s getting a bit confusing, because the list is growing by the day. At the heart of the confusion is: which of these taxes is Labour in favour of and which ones aren’t they in favour of? It’s pretty difficult to tell because, fundamentally, you can’t trust Labour on tax. They have a long-term love affair with tax, and they’re like people under Chris Hipkins who’ve sworn off the love affair, don’t have the love affair, but keep falling off the wagon. The problem is that they have all these unfunded promises and they know they need to sneak through some new taxes to pay for them.

We’ve had quite a few flip-flops, haven’t we, in the past few days? The first one that I found quite beautiful was: are they or are they not taxing Kiwis’ Netflix subscriptions? Well, the streaming tax—Hipkins was definitive: it’s not policy. There’s a small problem: not only had Willie Jackson taken the tax to caucus and had it approved by caucus; he had also submitted it as a member’s bill. Don’t worry. Just believe Chris Hipkins when he says, “Oh, no, no, no. That was never on the table.” But, you know, I have to commend Carmel Sepuloni because she was the most honest on this topic. Do you know what she told us this morning on Morning Report? She was asked about the streaming tax, and she said, “Well, look, as you get closer to the election, you do need to be careful about the optics of what you’re promoting.”

Good on Sepuloni. She said the quiet bit out loud, which is “Of course we want to do all these new taxes, but we’re just not allowed to talk about them. Chris Hipkins has told us ‘Don’t talk about the new taxes. We need to keep them quiet.’ ”, and, of course, he knows that playbook well. Who remembers him in the last election campaign saying, “No way I’ll ever do a capital gains tax. Absolutely not—not on my watch.”, and he’s saying to all of these guys: “Don’t worry, when you say that stuff it, doesn’t really mean anything, because look at us now. We’ve got a capital gains tax now.”—don’t you? Actually, what you say on tax cannot be trusted.

I’ll give you the next example: the ute tax. They didn’t campaign on that in 2020, but that didn’t stop them implementing it, and it’s not stopping Michael Wood from going doorstep to doorstep in Mt Roskill and saying, “Let me tell you about one of my greatest hits: the ute tax. Wasn’t that a winner?” That’ll be back—the ute tax will be back.

Then land tax—and this is another hit from Willie Jackson. Wow, he’s really on the tax train. He was asked by Ryan Bridge: “Well, what about the Opportunity Party’s land tax?”, and he said, “Oh well, we wouldn’t do it at that rate.”, and so Ryan Bridge said, “Well, so what percentage of land tax would you accept?” Willie grinned and said, “Who knows?” I guess it just depends on how many unfunded promises they want to make in the next 80 days.

What this actually comes down to is a party on the other side who fundamentally believe that the way to make New Zealand a better place is to punish the things we need: punish the savers, punish the investors, and punish the people who do the right things, who grow businesses, who create jobs, and who start enterprises. Well, National says no.

We say we need lower taxes. We need to back the hard workers, back the investors, back those who save, back talent, and back opportunity creation, and we are able to do that because we hold ourselves accountable for delivering with your money.

15:02

It would appear that auditions to be the next Leader of the Opposition have begun already, because that was a speech from someone who has given up on governing the country. Five whole minutes in the House, and not once did she mention anything this Government has achieved, probably because she could not find one good achievement to talk about.

Do you know what else Nicola Willis did not mention? Christopher Luxon. Not once—not one mention of the Prime Minister. So desperate are they to not talk about their own leader, she spent five minutes talking about the Opposition. They don’t want to talk about their own track record. They don’t want to talk about the turmoil and the chaos that is the leadership of their own Government, and so they spend their time making things up about the Opposition, instead of tackling the challenges facing the country.

If we had a Minister of Health that was focused on actually delivering, you know, healthcare for New Zealanders, we might not have the crisis in the health system that we have now. If we had a Minister for social development that was focused on making sure people get paid their entitlements on time, we might not have 15,000 pensioners going without the winter energy payment.

The real-world consequences of that are very clear to see. Older New Zealanders are sitting at home not turning the heater on because they’re worried they can’t pay the power bill, and this Government says, “Oh well, that just happens.” Louise Upston was told about that problem 10 weeks ago—10 weeks ago. One would think that a Government focused on the interests of New Zealanders would actually do something about that, but we know that’s not what the National Party have been focused on. They’ve been focused on fighting for their own jobs, not fighting for New Zealanders. There have been 15,000 pensioners shivering at home, not able to pay their power bills, because this Government cut their winter energy payment in what it claims was a mistake. It was simply incompetence from a Government that’s not focused on the job.

Those members promised that they were going to fix the cost of living. What have we seen instead? The price of bread—which Christopher Luxon didn’t seem to know yesterday—is up 72 percent under this Government. Butter is up 85 percent under this Government. Company liquidations are at a 15-year high. Youth unemployment is at a 30-year high. KiwiSaver hardship withdrawals are at the highest rate ever under this Government. Those are people who are desperate.

But this Government said they were going to get the country back on track and they were going to fix everything. They keep going on about the previous Government, so let’s compare the track records, shall we? Prior to the election, by now, unemployment was forecast to be at 4.8 percent. What is it now, after they fixed it: 5.5 percent—after they fixed it. Government debt—because they go on a lot about Government debt, don’t they? Despite the fact that half the debt that the country currently has was accumulated under National Governments, they do like to go on about this a lot. By now, in the pre-election update, it was going to be down to 39.6 percent of GDP by 2027. What’s it going to be now by 2027 under this Government: 45.6 percent. After they fixed it, it went up. The overall deficit—remember they were going on about, “Oh, we’re going to get the books back in balance.”? Well, by now, if the previous Government’s forecasts had been correct—because we’d been re-elected—we’d have a $1.5 billion deficit. It would be going into surplus next year by $2 billion. What’s happened since they fixed it? Anyone want to guess? Well, the deficit this year is going to be $15 billion. Not $1.5 billion—$15 billion after they fixed it; and next year, when it was supposed to be back in surplus, instead, it’s going to be $14 billion in deficit. Goodness me, imagine what being off track might look like these days. If they think this is what being on track looks like, they need a reality check.

And, of course, remember: growth, growth, growth, that’s what this Government is all about. 2026 was forecast to have a growth rate of 3.7 percent before this Government got elected. What’s it forecast to be now? Anyone want to guess? 1.2 percent. They’ve cut it to a third of what it was going to be—so much for growth, growth, growth. But we now know what’s really been on the Prime Minister’s mind: not only keeping his job but, apparently, if you put a cycleway between his apartment and Parliament, he needs to charter a limousine to come across the road in order to get here, because with the cycleway in the way, apparently, he doesn’t know how to cross the road. Clearly, if he can’t figure out how to cross the road, maybe his colleagues were right—maybe he should give up the job. I’ll tell you what, in just a few more days, he’s going to be giving it up.

15:07

You’ve got to feel sorry for Chris Hipkins. He’s sitting on a powder keg of taxation expectation from his colleagues: the Trojan Horse, of course, the capital gains tax that will metastasize over time, already $5 billion in getting rid of Investment Boost, bringing back the ute tax, Willie Jackson trying to introduce the streaming tax, and does anyone believe Barbara Edmonds’ soothing sounds as she tries to placate Marama Davidson and Chlöe Swarbrick? Has she not been paying attention as they rage against the machine day in, day out in here as they look to bring in a wealth tax, a capital gains tax, an inheritance tax, and a rental tax, killing inspiration and killing business with a wrecking ball through our economy? If you need any more—banning nitrogen fertiliser, well, that will be ruinous for our agricultural powerhouse; or keep a cap on The Opportunities Party who seem intent on introducing full-blown communism. Te Pāti Māori, what are they on about? No one really knows, apart from standing for ethnically dividing New Zealanders into two. Good luck with that, Barbara Edmonds.

Kiwis do not want to be taxed more; they want a fair go. New Zealand First is the party with the courage to take on the vested interests that are sucking Kiwis dry. The supermarket duopoly, we’ll break them up; the Aussie banks are going to get some much-needed competition; and we’ll break up and go after the gentailers as well, those entrenched entities that are using their market position to feast off the paychecks of hard-working, everyday Kiwis at will. New Zealand First is the only party that has the courage to take them head on. Tweaks to the status quo will not be enough. We have them fair in our sights.

New Zealand has an infrastructure deficit, as has been well traversed. There has been a recently announced road of national significance north of Auckland—$3.6 billion for 26 kilometres of road. We announced this week the next phase in planning for the Auckland Harbour Bridge, which will cost eye-watering sums of money, but we must not forget about rural and provincial New Zealand. It’s where 82 percent of our merchandise exports come from.

At the same time as those announcements were made, Mayor Rob Scott of Southland was threatening to rip up rural roads and return them to gravel—hundreds of rural bridges to maintain. That does not look like fixing the basics and building the future; that looks like a provincial powerhouse not getting its fair share.

At the South Island conference, it was revealed last week that the South Island is only getting 11 percent of the road transport budget, yet we produce 30 percent of the exports. We need the Hope Bypass. We need the Woodend Bypass. What chance does the badly needed Mosgiel bypass have to feed the newly instituted inland port that was invested in by the Regional Infrastructure Fund?

There is a saying: “By their deeds you will know them.” New Zealand First has always been the party that has used its political capital—every ounce of it—to return money back to regional New Zealand, whether it be the Provincial Growth Fund in a previous Parliament, or the Regional Infrastructure Fund in this Parliament, getting infrastructure investment ring-fenced for provincial New Zealand.

I just came back from the Chatham Islands last week where I was opening a new airport and the finishing of the runway, a mix which will fortify the island and futureproof it. We also announced upgrades to wharf infrastructure and upgrades to their fuel storage facilities. We put in new wind turbines there to give them renewable energy. It’s that sort of investment in regional New Zealand where New Zealand’s wealth is created—the farmers, the fishers, the foresters, the horticulturalists, the miners, and soon to be drill, baby, drill, when we get out there with New Zealand First’s $1 billion investment commitment.

This is where our internationally renowned tourism locations are situated. It’s critically important that they have the infrastructure. They want a fair slice of the pie in regional New Zealand. They know that New Zealand First is the party that will always back the regions, has always fought for their interests, and will be taking a huge platform of regional economic development through the $100 billion future fund going into the next election. New Zealand First: for the regions.

15:12

Well, thank you, Mr Speaker. Wasn’t it interesting listening to Mr Hipkins’ speech, where he was desperate to talk about anything else except for his taxes—absolutely desperate to talk about anything else except for his taxes. He sounded more like someone sitting on the side of the road barking at passing cars rather than providing solutions for the problems facing New Zealanders. All I heard in his speech was lots of complaining, lots of problem definition, but no solutions for the future of this country.

I tell you what: in around 80 days, New Zealanders will be going to vote in the voting booths. They will be going to the election and they’ll be asking the question, “What on earth has Chris Hipkins been doing for the last three years? Nothing. Well, he has been up to something—he has been up to something. Sometimes he’s been up to things he’s not quite aware of.

One thing he is aware of is that he said before the 2023 election that Labour, under his leadership, would never, never, ever put in place a capital gains tax. Well, at least he’s had the honesty of his conviction to get out there and tell New Zealanders that actually, no, Labour will bring in a capital gains tax if elected at the election this year.

But there have been other things that he is just not quite aware of. On Sunday, Nicola Willis put out a press release pointing out that Labour was campaigning on a streaming tax. Chris Hipkins gets down on the tiles and says, “No, that’s not true. That’s hysterical. That’s absolutely false. That’s fake news.” Well, lo and behold, Willie Jackson had a member’s bill in the ballot for a streaming tax. He had it in the ballot box. Not only was it in the ballot box but it had 34 names of Labour MPs signed up in support of it, one of which was Chris Hipkins. Chris Hipkins was supporting a bill he didn’t even know was in the ballot box as of yesterday morning.

Well, New Zealanders know this is just scratching the surface of all the taxes that Labour’s got coming. Of course, they have an $18 billion funding gap for all of their freebies. I’ll tell you what: a freebie is not a solution for the problems facing this country. You don’t fix the challenges facing New Zealand by throwing money around. You don’t fix the problems facing New Zealand by simply promising a bunch of freebies. Of course, that is the only solution the Labour Party is taking to this election—freebies here, freebies there, and freebies everywhere. The reality is every single one of those freebies needs to be paid for somehow.

We’ve now heard Chris Hipkins and the Labour Party out there saying “The only tax we’re taking to the election is a capital gains tax.” Well, every single person in this House knows that’s not true. Labour has already said, “We’re going to axe Investment Boost”, a $5 billion tax on businesses up and down this country. That’s an additional tax they’re taking to the election, and everybody knows that they can’t wait to reverse the changes on interest deductibility. They want to put in place a tax on renters once again.

Just on you.

Last time they were in Government, the average rent went up by $180 per week—Mr Jackson, you remember that because that’s what you did. Under National, since we got rid of the renter’s tax, we have seen flattening rent increases because of our policies.

Of course, this is the other thing that everyone knows: Labour needs the Greens and they need Te Pāti Māori, and they need the Opportunity Party’s taxes, too. So there’s not only a capital gains tax, a digital services tax, a business tax, a tax on 45 cents in the dollar on income over $160,000 coming, an inheritance tax, a gift tax, a rental tax, an asset tax, and, of course, the Opportunity Party’s land tax—because not only do they want to tax you until you die, they then want to have an inheritance tax to tax you when you die, and the land tax will be there to tax the cemeteries so that you keep paying after you die. And, of course, the streaming tax and the ute tax—well, we know that those will come back, because Willie Jackson can’t wait to bring in a streaming tax and Michael Wood is out there door-knocking his heart out for a ute tax.

National is campaigning to lower the taxes on New Zealanders—keep taxes low. We say no to Labour’s taxes. Party vote National to stop Labour’s taxes.

15:17

Today, I rise to congratulate the Hon Chris Penk. What a good man. As our leader said, the only member of the National Party caucus with the intestinal fortitude to say out loud what every New Zealander’s been saying for the last 18 months—where are you going?—that this Prime Minister is not up to the job. And his reward? Kicked out. Because that’s what you get when you launch a one-man coup, isn’t it? You get kicked out. But as Mr Peters said—making some sense, for once—in his whole lifetime he’s never seen a one-man coup.

We all know it wasn’t a one-man coup. They were all on it. The problem is they couldn’t work out who would be the leader, and they lost their nerve, and they lost their numbers. And I’ll be coming to you shortly, Mr Meager. As Matthew Hooton said—he called them “villains”. I prefer a more accurate term; I think “gutless wonders” would be a better term. Traitors, not just to the National Party traditions, as Chris Finlayson has said, but to that fine young man, Chis Penk.

Now who were these useless detractors? Who were they? Oh, well, the boy wonder’s just left. We heard him with Jack Tame talking about the Prime Minister. He said the Prime Minister’s working hard every day. The problem is he couldn’t name one thing that the Prime Minister had done—not one. Then there’s the future first Māori Prime Minister in his mind, James Meager. When asked whether he supports the Prime Minister, he talked about the All Blacks, he talked about rugby, he talked about everything apart from the Prime Minister. “Mr Meager, do you support the Prime Minister?” “Oh, those All Blacks are going well. That rugby is going well.” Oh, Mr Meager thought he was on his way back to Cabinet, but down the tubes—down the tubes he went. Then there’s “Goldie”—then there’s “Goldie”—admittedly a Prime Minister supporter, but when he was asked whether he would be interested in the job, he thought, “Well, I don’t really do much anyway. I’ve got all these portfolios, and Willie calls me the ‘Minister of Doing Nothing’. I’m No. 7 on the list and, if I was the Prime Minister, I’d be No. 1.” Did “Goldie” make himself available? Well, yes, he did—yes, he did.

Then we come to the two big players—the two big players—the “Bish” and Erica Stanford, the Minister who, according to the New Zealand Herald, was going to wear the crown while Chris Penk wielded the knife. The problem was that the “Bish” lost his nerve—and lost the numbers—and the only knife he used was the knife he used to cut Chris Penk’s throat. Poor Chris Penk, a good man.

Which brings us to Erica Stanford. Who will ever forget the image of her walking through Wellington Airport, sashaying her way through Wellington Airport like she was the Queen of Sheba. She thought she was on the way to the prime ministerial job, but she didn’t know Nicola was behind her—the Minister for women’s affairs, coming behind her. “Do you support the Prime Minister?” Not a word—not a word—of support for the Prime Minister. She thought she was on the way to glory, until the Minister of women’s affairs said, “Well, we’re good mates, great friends. She’s just not prime ministerial material.” Poor, poor Erica—

Under the bus.

Under the bus—under the bus. Shamed and thrown under the bus by the Minister of women’s affairs. A shambolic coup fell apart—a disgraceful coup. Shame on this party.

But that’s this Government. It now spends more time managing itself than managing the country, and on the very day this Parliament debated the leadership coup, we had 15,000 pensioners suffering. That’s the story this coup buried. That’s what this Government has been doing while its senior Ministers have been counting numbers in the corridor. Chris Penk did the country a favour. He held a mirror up to the Prime Minister and asked him to have a look. The Prime Minister sacked the man holding the mirror. In a few months’ time, the voters of this country will hold up their own mirror, and this Prime Minister, and every single one of the Ministers I’ve named, are not going to like what they see. Kia ora, Mr Speaker.

The honourable Carl Bates—sorry—

Thank you, Mr Speaker.

Just a minute. The member will wait for me to call him: the member for Whanganui, Carl Bates.

15:22

Thank you, Mr Speaker. To have a good tax policy, it helps to have people who actually understand tax. The Labour Party doesn’t have a single chartered accountant in Parliament, nor does Te Pāti Māori or the Greens. It’s a bit like a hospital without doctors, a school without teachers, or the Labour Party without unionists.

Maybe—maybe—that is why, when it comes to economic policy, the only answer they seem to have is “tax, tax, tax”. No matter what the question is, the answer is always the same. Need more spending? “Tax.” Need a new programme? “Tax.” Need to pay for another promise? “Tax.” As we head towards 7 November, New Zealanders are looking at the Labour Party, the Greens, and Te Pāti Māori and their menu of capital gains taxes, wealth taxes, inheritance taxes, land taxes, digital taxes, streaming taxes, and business taxes. It’s pretty clear that the Opposition’s manifesto has more tax proposals on it than a McDonald’s menu. Next, you’re going to hear the Labour Party’s campaign ad say, “Would you like tax with that?”

The real issue here isn’t any one tax; it’s the pattern of taxes—and ever more taxes, at that, I might add. The Labour Party, the Greens, Te Pāti Māori, and Opportunity have built an agenda around new taxes and higher taxes. Labour is also being questioned on bringing back that ute as well. The question for New Zealanders is simple: when the answer to every problem is another tax, who pays? The answer is households, the answer is workers, the answer is farmers, the answer is businesses, and the answer is families.

What makes the Opposition’s “tax-athon” especially concerning is their tax stack. This refers to the fact that some of the taxes stack on top of the other. This is where understanding tax becomes important. Yet, Labour doesn’t understand it. Labour and their mates just want more of it. They don’t understand how these taxes will destroy our economy, nor do they understand how they’re going to eat into the hard-earned savings of every New Zealander. Let me give you an example of the Opposition’s collection of taxes and how they stack together.

Look at their proposed taxes on multinational tech companies. The Greens want a withholding tax on offshore profits; Labour wants a digital tax—different names, different mechanisms, but both potentially hitting the same businesses. This “tax-athon” attitude of Labour, the Greens, and Te Pāti Māori brings with it this broader mindset—and speaks to this broader mindset—that when the Opposition needs more money, they don’t ask “How do we grow the economy?”, they ask what we can tax next.

National has a different approach. Instead of taxing investment, we are encouraging it. I’ve spoken with businesses making decisions because of Investment Boost: the transport operator who bought seven new truck-and-trailer units and expanded their fleet; the concrete company that invested in a new forklift to create and lift their productivity; the farmer who bought new tractors to get the job done easier. That is how you grow the economy; not another tax, not another levy, not another money-grab dreamt up in the Labour Party’s caucus room.

Ultimately, this comes down to a choice. It comes down to a choice between Labour, the Greens, and Te Pāti Māori, along with Opportunity’s approach, to more spending, more borrowing, and more taxes. National’s approach is to grow the economy, back investment, create jobs, lift incomes, and help Kiwis get ahead. New Zealand doesn’t need another tax; we need economic growth, we need higher incomes, and we need a Government that understands that you cannot tax your way to prosperity. When Labour sees a problem, they reach for a tax. When National sees a problem, we reach for growth. Only by growing the economy can we help all Kiwis get ahead.

15:28

Thank you, Mr Speaker. Today, I stand on behalf of the ACT Party to talk about the integrity of our democracy and the system that we have here. ACT has serious concerns over recent allegations of electoral fraud in Manurewa. This has recently been reported in the New Zealand Herald, and it is quite alarming. I expect that all parties across the House should be concerned by what allegations have been printed by the Herald.

Elected Manurewa local board member Raewyn Bhana QSM has laid a formal complaint with the Auckland Council, and she has passed that complaint on to New Zealand Police and the Serious Fraud Office. The complaint comes from a whistleblower who has told her that he was part of a team of people who, over seven nights, went around people’s letter boxes and started taking electoral voting forms from those letter boxes. He and others then went to an address, where they opened up those ballots and they filled them in. Where some of those electoral voting forms were wet, they even put them on heaters to dry them out, so that they could fill them in.

The whistleblower has then suggested that a number of them took handfuls of these voting ballots and went to several supermarkets around the area to deposit them. This is of absolute concern, not only because this has happened but also because of the threats that have now occurred towards Raewyn Bhana QSM and her whistleblower. Raewyn has been told to watch her back, and the whistleblower has indicated that there’s been a gang hit placed upon him. Police are making inquiries into this issue, and of course the independence needs to be tested and verified by New Zealand Police as they look into this very serious matter. We should not pre-judge exactly what has happened here, but equally, New Zealanders should be concerned, because caution must not come at the expense of complacency.

The reason why I feel that this is so important is because liberal democracies like New Zealand’s are actually not the norm in the world. The Economist Intelligence Unit Democracy Index 2025 indicated that there’s only 26 full democracies around the world. More than half of the world’s population does not live in a democracy. Liberal democracy means we have a right to vote in free, fair, and regular elections. We have a history of doing so. In 1853, the first members of this House of Representatives were elected. In 1867, all Māori males aged over 21 were allowed to vote. In 1879, universal male suffrage, for all men over the age of 21, was instigated. In 1893, universal women’s suffrage was also implemented. We were the first in the world, and we did all this before 1900, and I note in 1974, we lowered the voting age to 18, and in 1990, the Bill of Rights actually affirmed the right of adult citizens to vote in genuine, periodic, and free elections. When I look around this Chamber, I see the plaques that represent the lives that were lost by so many representatives of New Zealand: our soldiers who fought to allow us to stay in a free and liberal democracy.

If these allegations are proven, someone is deliberately taking away the rights of a person to have their voice, their choice, and their vote heard. A stolen voting paper is not just mail; it represents stealing the democratic voice of individuals, that is then being taken and used by someone else. The right to vote is the right to be heard, and the right to have a say. The right to vote is the opportunity to choose a representative for you, and the right to vote also gives the people the power to remove people that they don’t want there. The right to vote also holds people accountable—

You took that away.

No, I didn’t take anything away.

—to the people that they serve. These allegations strike to the heart of New Zealand’s democracy, and we must make sure that those voices and our democracy are protected.

15:33

Tēnā koe e te Māngai o te Whare. This week we have heard about the Government’s rushed changes, through urgency, which left 15,000 pensioners without their Winter Energy Payments. I just want to list off some of the temperatures from MetService in the last month: 1.7 degrees in Wellington, -2.8 degrees in Hamilton, -4.6 degrees in Christchurch, and -5.1 degrees in Taupō—the electorate of the Hon Louise Upston. It’s a disgrace, that during some of the coldest months this year, 15,000 pensioners and veterans lost their Winter Energy Payment because of National’s shoddy lawmaking processes. Losing this payment meant that our most vulnerable New Zealanders have been living in freezing homes, losing this payment at this time, during a cost of living crisis, where the cost of living is soaring, food prices increasing, and the cost to see a GP also increasing. This is what National delivers to our kaumātua and kuia, to our elderly citizens. National bungled the Winter Energy Payments for Kiwis, making it tougher for them through winter months. This is the human cost of their rushed lawmaking.

Today, we have seen a report from the New Zealand Council of Christian Social Services. The report is titled The Older Persons Poverty Monitor. What that report shows is that 76,000 elderly people were accessing Special Needs Grants; 25,000 elderly people living without the essentials; 51,000 elderly people putting off a GP visit due to the cost. Yesterday, in answers to questions in the House, the Minister said, “Oh, it was less than $300.” Well, that means a lot to these elderly people, who as we see from this report released today, are putting off going to see the doctor because of the cost. We know they were not turning on their heat pumps or their heaters because they had not been receiving this support. In fact, to share a quote that I received, a person wrote to me about their 98-year-old mother, who was affected by this botch-up: “She received a letter of suspension in her mailbox on Saturday, 25 July 2026, and said she was stressed, anxious, nervous, sleepless, and worried because of these changes.”

These law changes were rushed through without proper scrutiny and without consultation. Yesterday, the Minister and the Prime Minister gave what I think are pathetic apologies to those who have been impacted by something that was of this Government’s doing. What did they do? They threw their officials under the bus. The Minister said it was a policy mistake; the Prime Minister said it was an IT issue. Well, the Minister also said that this probably wouldn’t have been picked up if it had gotten more scrutiny. What I’d like to point out for the House today is I actually went back through the entire Hansard, and it was being picked up—and if it had gone to a select committee, it would have had a better chance of being corrected there, because in fact, Ingrid Leary, who is in the House today, raised it in her contributions. Ricardo Menéndez March actually had an Amendment Paper on the table to expressly exclude the Winter Energy Payment, but no. It was rushed through urgency, no proper scrutiny, no select committee process, and then we have 15,000 veterans and pensioners impacted by this, losing their Winter Energy Payment.

The Minister should take responsibility for this. It was her legislation, rushed through urgency without proper scrutiny, and without proper process. The other thing is that the Minister said she found out about this on something like 14 August. Actually, she was emailed by the Labour Party 10 weeks ago, and her office ignored it. It was in the title: Winter Energy Payments could be impacted—or are being impacted—by this. No, ignored—and so these elderly people, like I said at the beginning, were sitting there in the freezing cold, not receiving something they should have been entitled to.

Oh, the irony though. The Government, the Ministers on the other side, they’re entitled to their entitlements, but what about our senior citizens, who were entitled to this but were ripped off because of botched lawmaking processes. Kia ora Mr Speaker.

15:38

Tax, tax, and more tax. This is Labour’s answer to paying for all their so-called free promises. Well, let me tell you: nothing comes for free. I teach my children that, and we are learning that nothing comes for free. “Sugar hit” economics is not the way to help hard-working New Zealanders get ahead. It is just a short-term fix. Between Labour, the Greens, Te Pāti Māori, and the Opportunity Party, they’re proposing nine new taxes. Let’s name a few of these nine new taxes. A capital gains tax: the Kiwi dream of owning a bach, Labour wants to tax it. Higher income tax: doing well at work and earning more, the Greens want to tax it, 45 percent. Inheritance tax: if your grandparents leave you something when they pass away, they’ll tax it. A gift tax: want to help your kids get into their first home? The Greens want to tax it. A streaming tax: you watch Netflix, they’ll tax it. A digital services tax: if you’re on Facebook, they’ll tax it too. A rental tax: own a rental, they’ll tax it. A business tax, a land tax, and let’s not forget: the ute tax.

Those hard-working farmers, tradies, and anyone out there owning a ute—they want to introduce a ute tax, again. We scrapped it. We’re not punishing all those hard-working tradies and farmers out there, and we don’t want to live in a country where your hard work is taxed and taxed—everything is taxed.

The National Party is the party of lower tax. National is the party that provides tax relief to hard-working New Zealanders, and Labour are already saying they’ll take away this tax relief that we’ve worked so hard to implement.

Let’s take Investment Boost. Our Government worked really hard to introduce Investment Boost to support businesses to grow jobs and opportunities. Investment Boost offers 20 percent deductible tax relief for businesses investing in capital assets. This is practical, it’s targeted, and it stimulates growth. It creates jobs and it helps us lift incomes in this country.

We’re seeing real results, and I speak firsthand of seeing the real results in Hawke’s Bay, the fruit bowl of New Zealand. Just last week I was out in Kelston Orchards with our amazing Minister of Immigration, Erica Stanford, and we saw tax relief and Investment Boost in action. It’s enabled them to invest in the Recognised Seasonal Employer (RSE) scheme accommodation and to house over a hundred RSE scheme workers each season. The RSE scheme ensures they have the seasonal workforce when they need it to pick the fruit at the optimum time so that they can get it off to market and help grow our economy.

It’s also enabled us to grow many, many permanent jobs for New Zealanders, and it was impressive to see our growers using Investment Boost to invest not only in the RSE scheme accommodation but in cool-store innovation, packhouses, automation, and robotics. Recently, I opened the Mt Erin cool-store, and they were also using Investment Boost and providing a lot of new jobs—permanent jobs—for New Zealanders.

We want to see more of this growth and, of course, we’ve got to remember that Investment Boost also flows into other areas of the economy. It provides jobs in the civil and contracting area because, of course, they’re getting the flow-on effect of the growth of our horticulture sector. Just recently I visited Stephenson Transport, a wonderful stock truck company in Central Hawke’s Bay. They’ve also used Investment Boost to invest in their trucks, and there are many, many more stories where we’ve seen landscape companies investing in robotics, scrub-cutters in Hawke’s Bay, and cafes investing in new equipment because it’s this type of tax relief that grows jobs and grows opportunities and it lifts wages. That’s what works to build the future of New Zealand.

15:43

Thank you for that segue, Catherine Wedd, because I think that that quote that you said in your speech around it being the Kiwi Dream to own a bach is just so far out of touch with reality. Most New Zealanders—

It wasn’t actually me that was speaking, but carry on.

Most New Zealanders, and particularly those of my generation, are really worried that we won’t even be able to afford a house or a family home, point blank—period—without even considering the idea of one day ever being able to own a bach.

I’m glad you segued that because that’s exactly what I want to talk about, because for the last two days in this House, I’ve heard Chris Bishop get up and tell us that it is the best time ever to be a renter, that things have never been better for renters, and that rents are so affordable, which is just in total conflict with what Renters United! and over 3,000 renters said in the report that came out over the weekend.

What they told us is that for 40 percent of renters, their biggest issue is the cost of their rent; for 42 percent of renters, their homes are still damp, cold, draughty, and mouldy, despite healthy homes standards coming into place; and 11.5 percent of renters said that they spend 80 percent of their income on rent. I hope that in this House we can all agree that that’s not good by any means.

Not to mention that this whole general debate has been about all of these taxes, the so-called rental tax—all of these different taxes. Again, it’s been a real slap in the face to have the Minister of Housing get up and talk about how great it is to be a renter when the reason that rents have stagnated or flat-lined in this country is not because of any policies or law changes that this Government has made; it’s actually because everybody is leaving, at a rate of 200 New Zealanders per day.

The supply and demand.

Do you want to know why rents are declining in Wellington?

Supply.

It’s because thousands of people have been laid off from their jobs, James Meager, and that’s not a funny joke. There are no jobs here in Wellington and people are leaving, and that is why there is not a lot of competition in the rental market. That is not something to get up and brag about, and, actually—

So you want more supply?

It’s not as simplistic as a supply conversation.

You just said that.

No, it’s not, because if everybody is leaving, of course rents are going to go down, because there’s no workers to fill those homes. Simple economics—which I thought that that side of the House understood.

Anyway, what I really want to talk about is the fact that this Government changed the rental laws two years ago, and we don’t really hear a lot about that any more, do we? But I want to talk about the fact that more than 60 percent of renters have said that their lives have not improved—not one bit—since the Government changed the laws and reintroduced no-cause evictions and decided to rob the 100,000-plus lowest-paid working women of pay equity. They’re happy to give $15 billion of tax cuts to landlords, and they will rob the lowest-paid workers in this country to pay that.

But let’s also talk about the fact that since the Government changed the rental laws, the number of Government MPs that have bought investment properties over that side of the House has grown. Let’s talk about the fact that ACT MP Parmjeet Parmar has bought five new houses since they changed the rental laws. Let’s talk about National MP Katie Nimon, who has bought three new houses since they changed the rental laws. Let’s talk about National MPs Erica Stanford, Simon Watts, Tom Rutherford, Joseph Mooney, Shane Reti, David MacLeod, and Grant McCallum, who have all bought another home to rent out since they changed the rental laws and changed rental tax.

I don’t rent my place out, thank you. I live in it.

Or let’s talk about the National and New Zealand First MPs, including Grant McCallum, who bought a house in Wellington so that they can pay themselves the accommodation allowance while taxpayers pay their mortgages off.

Point of order, Madam Speaker. I have not bought a place to rent it out, and I do not rent it out.

What is the point of order?

It’s misinformation. What she’s saying is incorrect.

All right, I’ll read it out. The Spinoff reports that National and New Zealand First MPs Carlos Cheung, Jamie Arbuckle, Hamish Campbell, Ryan Hamilton, Mark Patterson, and Todd McClay all bought new houses—

Sorry to interrupt the member, but I’m just going to get some advice. Right.

OK, I’ll proceed. It’s not a personal inference, actually. If the Government has changed the laws to make rental properties and rental housing that we rely on a commodity—something to make disgusting profit from while the streets are lined with sleeping bags and while people are paying 80 percent of their income in rent—that is disgusting behaviour. We need more people in this House who are not investment property speculators, because that is the reason why my generation will never be able to buy one single house, let alone a bach.

15:49

Point of order, Madam Speaker. I would like to make a personal statement to correct—

You’ll need leave.

I request leave, please, to make a personal statement to correct the comments from that member.

Leave is sought for that purpose. Is there any objection? There appears to be none.

The member opposite was concerned that I had bought a place to rent it out. I did not buy a place to rent it out; I purchased a place so I can utilise it to service the people of Northland when I’m in the upper half of my electorate. Thank you.

Speaking to the point of order.

There is no point of order.

Speaking to the personal statement?

No.

15:50

Monopoly is a classic multiplayer board game where we move around the board to buy, trade, and develop properties with houses and hotels. But imagine there’s a new version of Monopoly where every time you make progress, someone adds another tax.

Let’s start the game. You pick your favourite Monopoly piece, and if you choose a ute as your icon, congratulations—you may need to pay a ute tax just for choosing it. Then you move around the board and, finally, you land on the property you want to buy. You think “Great, I’m investing in my future”, but wait: there’s a land tax, asset tax, and capital gains tax waiting for you. All right, if you’re lucky, you go for a few rounds and you are finally are able to build a business and you manage to build a hotel. You think you’re going to create jobs and take a risk, but there’s another tax waiting for you: the higher corporate tax. Whoa! Tax everywhere.

You think now that you’ll work harder. You want to earn more and try to get ahead. Sure—that’s the right thing, right? Not so fast: the Green Party just proposed another 45 percent top income tax rate. Well, you ask yourself, with all these taxes, how can you save money? If you’re lucky, you’ve managed to save some, but wait, you’ve got another one coming for you: a wealth tax. Then you think, “OK, I’ve got a little bit more money now. I would love to help another player. I want to give them some money or an asset to help them to get back into the game.”, but wait: you may have to pay a gift tax just for being generous.

At this point, you may say, “That’s enough, I’m getting off this game.”, but even leaving the game may not be so simple because your family may face an inheritance tax. You’re like “Well, I’m going to be bankrupt. Let’s go to watch TV to relax myself.” Finally, you sit down, you turn on the TV, and you try to turn on your Netflix and watch some drama. Whoa! There is another streaming tax coming for you.

It looks like everywhere you go, there’s another tax waiting for you, all right. You ask, “What’s the point? Why am I still playing Monopoly? Maybe I shouldn’t work at all.” I have to wonder how many families in Mt Roskill are expected to keep paying more and more taxes when the cost of living is already putting pressure on their household budgets.

New Zealand used to be a country associated with dreams, opportunity, and aspiration. We encouraged people to work hard, to start a business, to invest, to innovate, and to build something better for themselves and their families. But the Opposition is, basically, telling me that we’ve got to turn this philosophy upside down: “We’ve got to tax them. We need to make sure that for every single dollar they earn, we tax them.”

This is not the New Zealand we should be building. New Zealand already has enough taxes. The question is not “How can we find another way to tax people?”; the question should be: “How can we make better use of the money we already collect?” How can we deliver better infrastructure, how can we deliver better healthcare, and how can we make sure every tax dollar from hard-working New Zealanders can get their return? They want a Government that respects the money they earn, they want a Government that rewards hard work, they want a Government that encourages investment and innovation, and, most importantly, they want a country where there is still a pathway to get ahead.

This is what the National Government is focusing on. We have very, very clear Budget responsibility rules: we will make sure of our return to surplus and we will control the net debt and also control the Government’s spending because we know that a responsible Government isn’t about finding another square on the Monopoly board where we can take more money. It is about making sure the money we already collect is spent wisely and delivers results.

We don’t need to add another tax to the board; we need better Government, better value for money, and better outcomes for New Zealanders. This November, you have a choice: a Government of more tax and more wasteful spending, or a Government here, focused on fiscal discipline, growing the economy, and investing in New Zealand’s future. Obviously, the answer is very clear: on this side, we are fixing the basics and building the future.

15:55

Thank you, Madam Speaker. There are two anchoring roles in foreign policy in New Zealand. The Minister of Foreign Affairs is the person who stands in Washington, in Beijing, in London, in Canberra, and in Suva, and tells the world what New Zealand’s values are. Diplomacy is the hallmark of his job, and when that individual creates friction in our relationships, the stakes are high for all New Zealanders.

There is another significant role in foreign affairs: it is the Prime Minister’s role. Now, something that’s probably not well known by members is that for much of the 20th century, the Prime Minister also personally held the role of Foreign Minister: Fraser, Nash, Holyoake, Lange, Moore, and Palmer. There’s a reason: because we are a small trading nation, our external relationships are existential. One in four jobs are linked to trade. Our reciprocal trade with China is $40.1 billion. The roles now sit technically apart, but they still sit very closely together.

The Prime Minister has responsibility, and so what should a Prime Minister do when a risk emerges in foreign affairs? Well, three weeks ago, we had the Minister of Foreign Affairs make statements—racist comments—in the House. The Prime Minister acknowledged that they were racist. He acknowledged they were offensive. He didn’t immediately contact the Foreign Minister—not until five days after the comments were made. He didn’t contact his Chinese counterparts at all to reassure them of the continuation of a respectful relationship. Instead, for a time he argued that it’s not within the purview of his oversight as the comments weren’t made as Foreign Minister, and so the big question is: does the Prime Minister in these circumstances have the authority to act?

He does on either of two foundations. The first is the Cabinet Manual. The Cabinet Manual is drafted broadly for a purpose: Ministers serve at the pleasure of the Prime Minister. He absolutely has the ability to make the call—in fact, it is his duty. Secondly, on 5 August, Minister Peters said in the House, “I stand by all my comments as the Minister of Foreign Affairs. I also stand by my comments as the New Zealand First Party leader.”, effectively affirming, with his ministerial hat on, the racist comments he made a week earlier. He was almost inviting the Prime Minister to call him out—but nothing.

I, like others, believe that it is not tenable for the Foreign Minister to retain his role, but perhaps the Prime Minister has considered that. If he decided to leave the role as it was, should he on the basis of risk still have taken some sort of action? I say yes because there are two real risks here.

There have been two formal representations made to New Zealand about Minister Peters’ comments: one in a phone call from the Chinese embassy to New Zealand on 30 July, and one in phone call from the Ministry of Foreign Affairs in Beijing to our Acting Deputy Head of Mission in Beijing on 31 July. We also know that there are sufficient reports in Chinese media itself in terms of taking offence at these comments. But the Prime Minister has chosen not to reach out to the embassy, nor to colleagues in Beijing.

The most serious issue here—the most serious issue—is not a debate on Minister Peters’ right to free speech; it is about the unwillingness of our Prime Minister to assume his role as chief custodian of our international relationships. New Zealanders deserve better than this. International colleagues deserve better than this.

As for Labour, we will not react in the room; we will not turn our back on the duty of diplomacy. Responsible foreign policy requires respectful, clear dialogue—clear in our independence and values, especially in today’s changing and uncertain global landscape.

The debate having concluded, the motion lapsed.

16:00

I move, That the sitting of the House today be extended into tomorrow morning to consider the following Government orders of the day: consideration in committee of the Disability Support Services Bill, and the second readings of the Social Security (Jobseeker Support and Accommodation Supplement) Amendment Bill and the Serious Fraud Office Amendment Bill.

I declare the House in committee for consideration of the Appropriation (2026/27 Estimates) Bill and the Disability Support Services Bill.

16:02

Members, the House is in committee for consideration of the Appropriation (2026/27 Estimates) Bill and the Disability Support Services Bill. We start with the Appropriation (2026/27 Estimates) Bill.

The Business Committee has determined to organise the debate by portfolio; Votes are available for debate, but only specific Ministers will be available each day to speak to the indicated portfolio. The Government has indicated that the Minister of Finance, Minister of Local Government, Minister for the Environment, Minister of Transport, and the Minister for Tertiary Education will be available today. Each debate will be led by a call from the chairperson or member of the committee that considered the Estimates most closely related to the Minister’s portfolios.

In leading off the debate, the chairperson should take care not to be overly political and should ensure their call gives a fair reflection of the committee’s report on the Votes relevant to the portfolio. This debate expires after 11 hours, at which point questions will be put that the Votes stand part of the schedules and on the provisions of the Appropriation (2026/27 Estimates) Bill. All parties have time allocated proportionally.

The Estimates debate should be relevant to the Government’s current spending plans as contained in the Estimates of Appropriations. A compendium of the reports of select committees on the Votes is available on the Table.

The question is that the Votes contained in the Estimates of Appropriations for 2026/27 stand part of the schedules. Members, we start with the Minister of Finance. The Minister is available to speak to that portfolio from 4.00 p.m. to 5.00 p.m. I give the call to Ryan Hamilton.

16:04

Thank you, Madam Speaker. The Appropriation Bill for 2026/27 is a necessary dose of fiscal reality. It recognises quite plainly that New Zealand cannot keep spending as though global interest rates are a temporary inconvenience or that inflation will politely disappear if we just invest a little more. This bill puts discipline back at the centre of public finance, and not a moment too soon. This bill also keeps debt on a sustainable path. With global interest rates elevated, borrowing recklessly is not visionary, it is expensive. Every extra dollar borrowed today is a dollar future taxpayers must repay tomorrow, often with interest that could have funded hospitals, classrooms, or police. This is why this bill reins in baselines, trims low-value spending, and focuses on programmes that actually deliver housing outcomes rather than headlines.

Healthcare will certainly be a winner in this appropriations Budget, including the three nights for post-natal stays for new mums; law and order; education; infrastructure; defence; and, of course, the Cambridge to Piarere Expressway, fully funded. The Treasury estimates that for every billion dollars invested, 5,500 more jobs will be created. Some will call that “austerity”; most New Zealanders call that “finally living within our means”. It is remarkable how controversial that idea becomes only when applied to Governments rather than households.

This bill is not flashy, it is not fanciful, and it certainly does not pretend that fiscal gravity has been repealed. It is a steady, factual, responsible plan to stabilise the books, rebuild resilience, and ensure New Zealand is better prepared for global shocks without reaching for the usual shortcut of taxing New Zealanders harder. It funds core services, strengthens front-line delivery, and requires agencies to demonstrate value rather than simply demand it.

For some members opposite, that may feel like a cultural shock. After all, their approach for years could be summed up in three familiar steps: announce it, fund it, and when the bill arrives, tax it. This Government has taken a different view. No new taxes, no surprise taxes, and no creative rebranding of taxes as levies or contributions. Just responsible management of the taxes New Zealanders already pay. This is the work the public expects of us, and this is exactly what the Appropriation Bill delivers.

16:07

Thank you, Madam Chair, and thank you to the chair of the Finance and Expenditure Committee for a reference to the select committee report. During the select committee Estimates hearing, we heard from the Minister of Finance in relation to jobs, infrastructure, a number of the items within the Budget that have been paid for or cut—or savings, as the Minister would say—as a result of Government decisions.

I want to start with questions—first, in relation to jobs. The Minister has said that the Budget would create 220,000 jobs. What is the increase in the working-age population over that same period, and how many of those jobs have actually been made as a result of Budget 2026 decisions?

16:08

This was addressed in the select committee hearing. What I said—to clarify; once again paraphrased incorrectly by that member—was that what the Budget forecasts, according to Treasury’s analysis, is that over the forecast period, 220,000 more jobs will be created in the New Zealand economy. Of course, partly that does relate to population growth, but it is also supported by a range of policies, including baseline fiscal discipline which mitigates the corrosive effects of inflation, but also a range of policies which support economic growth and therefore job creation—including, for example, reform of the Resource Management Act, fast-tracking of major developments, the Investment Boost tax policy, and a number of other policies besides.

16:09

So how many actual jobs are attributed to Investment Boost in the last year?

Again, that matter was traversed at select committee. As the member should know from her time at the Inland Revenue Department, the full tax year to which Investment Boost applied has only just ended, and as the member will know, it takes a year after the completion of a tax year for final returns to be filed because most New Zealand taxpayers use a tax agent. Therefore, we do not yet have the data about how many people claimed Investment Boost in the year previous.

What we do know is that Investment Boost supports businesses who have made capital investments by allowing them to deduct 20 percent of the cost of that investment from their final tax bill, meaning it reduces the tax that they pay. What we also know is that the Inland Revenue Department (IRD) and Treasury assess that a policy of this sort will encourage more investment than would otherwise be the case, affording both greater rates of economic growth and greater rates of wage growth. It is the analysis of IRD and Treasury that the major benefactors of increased investment that Investment Boost will drive will be New Zealand workers.

16:10

I mean, I note the Minister’s comments that, obviously, this was traversed during the select committee process. It goes to the exact same point as to why I need to ask the question again, because when I just heard the Minister’s answer, she couldn’t actually address the actual question I was asking her. I was asking her for the actual number attributed to those changes. I do understand the Minister has minimal knowledge of the tax system, given she needed a provisional tax briefing very early in her term; however, she would know provisional tax is by a third—is within particular thirds. So my question is to the Minister: again, how much has actually been attributed? The actual number. We wouldn’t have to come into the House again and ask those questions if we had not got proper answers at the time. So that’s why we’re having to use the House’s time again to ask those same questions.

16:11

Well, Madam Chair, it’s very early in the Estimates debate for the Opposition member to have taken a cup of Mr Hipkins’ nasty juice. However, what I can clarify is that you don’t need a PhD in tax, like Deborah Russell has, you don’t need years of experience at IRD, like Barbara Edmonds has, to know this: if you impose more taxes on businesses, they will have less revenue available to them to invest in new job creation and higher wages for their people. That is why our Government is proud to support Investment Boost—the first effective tax reduction for businesses in far, far too long. That sits nicely alongside the policy that we continue to deliver on, which was the first adjustment to personal income tax rates for workers in more than 14 years—a policy change that that member opposed. So I can only take it that she would rather New Zealanders were paying more tax right now.

16:12

I’d just like to correct the Minister. My PhD is not in taxation; I’d like the Minister to withdraw that allegation!

I withdraw and apologise!

Going to some of the Minister’s comments around commitments—

Excuse me. Can I just explain to members in the Chamber: I need to give you the call because the cameras are operated remotely off site and the sound booth needs time to switch the mics, which is the purpose of me giving you the call. Honourable Vanushi Walters.

Vanushi Walters—I’m Barbara Edmonds.

Sorry, Barbara Edmonds.

16:13

I know we have the same haircut, but anyway. Thank you, Madam Chair. Going, now, to where a large amount of savings had come through from the Budget; it had come through Public Service reprioritisations. On a number of occasions, the Minister of Finance has committed to not cutting front-line services—she made that commitment back in 2023, she has made it throughout this term of Government. Does she still commit to no cuts to front-line services, given that there’s going to be a 2 percent, a 5 percent, and a 5 percent reduction in the number of Government agencies?

Well, in addressing that question, there are two points I’d like to make. The first is that I think it is incumbent on all members of this House who wish to be custodians of other peoples’ money that they work very hard to earn and then pay tax to us for, that we ensure we are always looking for ways to get more bang for their bucks, that we are always looking for ways to enhance productivity and delivery of public services so that the impact we are getting from every dollar is enhanced, not diminished, over time. That is the right goal for any Government to commit itself to. In this year’s Budget, our Government has absolutely committed ourselves to that goal by ensuring that we are not going to put an ever-growing cascade of public money into the back-office functions of public agencies, but are instead going to require them to live within their means and, indeed, live within New Zealand taxpayers’ means. In the absence of that effort, what we would be having to do is increase taxes on New Zealanders, and that is not a course our side of the House is prepared to take.

The second point I’d make is this, and it’s one that I’ve made in the course of many debates with that member over the past few years, which is her definition of what a front-line service is may differ from mine, which is to say that she would, for example, probably define the billions of dollars her Government invested in consultancy reports and contractors as somehow being front-line service delivery. Well, our Government proudly stands by the fact that we have capped and reduced the amount of spending on consultants across public agencies. That member would probably define all sorts of things as front-line service delivery which we would say, “Well, actually, no, those aren’t making a difference to New Zealanders and the outcomes they expect.” We see front-line services as those things needed to deliver core targets like lifting educational achievement, reducing waiting lists in the health system, ensuring fewer victimisations across the law and order system, and across all of those things we are getting better results as a result of driving more accountability for public money.

16:16

Thank you, Madam Chair. Well, then, given her definition of a front-line service cut is very different to Chris Penk’s, who regretted the fact that one of the local social services providers in Mahurangi and Kaipara, where he is currently the MP, has had to shut because of Government cuts to public services, the North Shore Women’s Centre has had to close as a result of Public Service cuts, what public services—given the cuts that are going to be coming of 2 and 5 and 5 percent consecutively—does she believe are not a front-line services? Especially given that it’s quite clear a number of community service providers who are funded through the Government sector have had cuts and have had to close as a result of her decisions.

Well, we simply think it is possible for the Government to organise its own functions better. We don’t think that there is some rule set in stone that what you must have is 29 separate departments with 29 separate IT functions, 29 separate payroll departments, 29 different brands, and 29 different layers of chief executives and deputy chief executives. Instead, we think, actually, to the extent that those agencies can be streamlined and organised around the delivery of services to New Zealanders on the front line, they should be. So that’s one source of efficiency and reduced spending that we see.

We also think the public agencies who may, in some cases, still be dependent on paper in a digital age, would be able to get more effectiveness and more efficiency by using modern digital delivery and systems which allow fewer hours to be spent on tasks to deliver administrative functions. Those are two ways that we see that there can be more efficiency and productivity in the Public Service.

I’d also point out that the corollary of what that member is putting to the committee is that she’s saying what must happen is there must always, in every Budget, be a large shovel used to dig more money of the pockets of New Zealanders to throw into the Public Service, because it must never be expected to do more with less. On this side of the House, we proudly say, “Actually, just as every household and every business in the country are always looking at their budget to say, ‘Hey, how could we ensure that we can get more impact, that we’re putting dollars in the right places?’, so too must Government.”

16:18

I think perhaps a good place to start is where the Minister just left us, where she was talking about Governments of all stripes, actually, needing to make decisions on taxation and on spending. I think that that is a broader philosophical debate which has very real-world, practical implications for New Zealanders, when different approaches are taken by Governments of different stripes. We here on this side of the House—the Green Party, in particular—very strongly believe in collective investment in the things that can increase our productive capacity as a country and increase our resilience.

To that effect, I just want to pick up on something which the chair of the Finance and Expenditure Committee said in his opening statements. He noted and, I think, implied that on this side of the House, we seem to believe that “inflation will disappear if we just invest a little more”. I think the member would hopefully understand that there are different types of investment. There are indeed types of investment that can reduce our exposure to imported inflation—the likes of imported inflation which our economy is currently suffering as a result of our exposure to fossil fuels.

Here I would just once again put on the public record that the Green Party actually wrote to the Minister of Finance and to the Prime Minister when the fossil fuel crisis first hit, seeing imported inflation on the horizon as a result of our economy’s exposure to fossil fuels, imploring the Government to work with us to reduce that very exposure which would otherwise result in the imported inflation which we are now currently seeing. The Government is actively blaming the fossil fuel crisis for the inflationary figures and the unemployment that we are seeing at this rate, and the cost of living that New Zealanders are experiencing, but there are opportunities for the Government to make investment to actively reduce that exposure to imported inflation.

To that effect, I actually just want to pick up on few things that this Government has actively decided to invest in and pulled its foot off of the lever to withdraw investment from, particularly the likes of renewable energy. Here, the Government will point to the fact that we have seen a lot of consenting of renewable energy projects, so let’s just let the market do what it needs to do. However, if we were to apply that logic across the board, then the Government should not be investing hundreds of millions of dollars in subsidising new fossil fuel production, nor potentially—

Firming.

Oh, if we want to talk about firming, for the members opposite, there are renewable versions of firming which would actually increase our sustainability and resilience, and, again, reduce our exposure to imported fossil fuel inflation. At the end of the day, my question, actually, for the Minister of Finance is something which I think is in all of our interests to understand, particularly in the lead-up to the election: does the Minister have any intention at all, or can she categorically rule out any potential taxpayer underwriting of the liquefied natural gas import facility that the Government has stated that it intends to move ahead with?

16:21

Thank you, Madam Chair. Minister of Finance, a key factor in your Budget that you tabled this year was a $2.4 billion in projected savings that were a result of losing almost 9,000 jobs in the Public Service. I understand that chief executives have been asked to provide plans to the Minister by August, and I wanted to ask if the Minister had an update on the amount of money that has been retained by her as a result of these job cuts, and also if she’s able to tell the House what job roles are going to be affected by these cuts.

16:22

Well, the member is conflating two separate exercises. The first exercise is about the reduction of baseline expenditure set out in the Budget estimates. The second exercise is about restoring the Public Service to the size it has traditionally been, which is to say 1 percent of the population. Now, it blew completely out under the last Government, who thought there was never a problem that couldn’t be solved by taxing people more or hiring a few hundred public servants, and so we are now undertaking an exercise to ensure it is restored to its traditional size at about 1 percent of the population.

Now, we’ve set that target to be achieved over a number of years, so it is a gradual consolidation rather than something that will be achieved overnight, and therefore we expect to hit interim milestones along the way. Yes, the member is right: public agencies have been asked to put forward their plans for ensuring that they keep within these headcount reductions over time, and I have not actively considered those proposals as yet.

16:23

Thank you, Madam Chair. To the Minister of Finance, I just want to turn now to the $450 million contingency that was in the Budget for possible further measures in response to the conflict. Obviously, when we discussed this back in May, things were a lot more recent, and we’ve now had several months pass. Just want to know if the Minister has an update on what plans, if any, there are to spend that contingency money.

The Minister told us, and it’s reported in the Finance and Expenditure Committee report, that the Government wanted to be able to implement further targeted, temporary, and timely responses if needed. This was in the context of talking about higher oil prices, inflationary pressures, and interest rates that would be factors when the contingency was used. Now that we are in August, can the Minister please give us an update on what the plans are with that $450 million contingency?

16:24

I stand by all of the statements I have made in relation to that contingency, which was a prudent measure by the Government to ensure that we were well positioned to react to what were inherently, and remain inherently, uncertain global events. As the member doesn’t appear to have any subscriptions available to her to international newspapers or Google, I’m happy to report to her that since the Budget has been delivered, what we have seen is both an escalation in events in the Middle East but, subsequently, further moves towards ceasefire.

The global oil price, which had spiked, has come down and spiked and come down again. Today, the price of petrol is sitting just over $3 a litre in New Zealand, diesel at about $2.70 a litre. At this juncture, the Government doesn’t judge that additional temporary supports are required, although a number of temporary supports do remain in place, including additional in-work tax credits for working families on low incomes hit by higher fuel prices, and including increases to mileage rates for a range of public servants, including relief teachers and those who are required to travel between patients for their healthcare work.

16:25

So has any of the contingent of that $450 million contingency been drawn down, and if it has been, what was it drawn down for? I do note to the Minister of Finance that these are serious questions, and it is precisely because of the changing nature of the conflict in the Middle East that these questions are being asked, and this House needs to understand that this is a very large—nearly half a billion-dollar—contingency that was sitting in Budget 2026. It was discussed at the Finance and Expenditure Committee. I think we could just have some answers to the questions around that. Google is something I think most members of this House know how to use, Minister.

16:26

Well, if the member had asked that question, I would have answered that question. The answer is no, there have been no drawdowns.

Has Cabinet or Cabinet committee considered any uses of the contingency, and additional to that, has the Minister of Finance received any advice on how that contingency may be used?

16:27

I just want to revert briefly to the discussion raised by my colleague Camilla Belich around the cuts to the Public Service. The Minister of Finance, in explaining some of the cuts that were going on there around the baselines, was with a view to reverting to the traditional size of the Public Service at around about 1 percent of population. That may well be the traditional size, but tradition is not always a good reason for doing something. Could the Minister please explain why 1 percent is thought to be the appropriate size for the Public Service? Surely, the size of the Public Service depends on the services it has to deliver, not on a particular percentage of population. So, if the Minister could tell us why that is an appropriate size rather than just a traditional size.

Well, we have ourselves a philosophical question, and I do wish to know from the member at some point what your PhD is in. I’m sorry that I misrepresented you earlier. I’ve always presumed it was taxation because I know you were a tax lecturer, and I presumed your lecturing related to your PhD, so I look forward to finding out.

Look, the philosophical point actually sits within this Government’s fiscal strategy, where we’ve also looked over time to ask ourselves the question: what is the appropriate size of Government? Because let’s be clear, the bigger Government is, the more resources it takes from the pockets of workers and from businesses and industry to spend on its own business, the fewer dollars are available for those same workers, business, and industry to go about their business. We accept on our side of the House that, yes, dollars are required to provide essential public services—a good health system, public infrastructure, and educating our kids—but what we don’t accept is the socialist premise that the way to nirvana is to ever expand the size of the State.

If we look back over time in New Zealand, the size of Government has proportionately been roughly 30 percent of the economy. We’ve set ourselves a fiscal target to get it back there. It is the case that under the last Labour Government, it went from around 27 percent to 34 percent in just six years, which shows you the alarming trajectory they would take us on. The reason, philosophically, we are uncomfortable with an ever-expanding State and an ever-expanding Public Service is because of the corollary it represents, which is: the only way to feed an insatiable State is to tax people more. You don’t need a PhD in tax, Dr Russell, to understand that; that if the Government just keeps growing, that means that workers need to give more of their very hard-earned wages to the tax man or the tax woman.

Our position is that, actually, New Zealanders probably need more of their own dollars in their own bank accounts to meet their own household needs, and make their own decisions about whether they invest in their children, whether they invest in their homes, what they invest in their lives, and the more dollars we take, the fewer choices they have about how they go about it. We set ourselves discipline, and we say, actually, let’s get the Public Service about where it’s been, which is 1 percent of the population, and let’s get Government spending about where it’s been—30 percent of GDP. Let’s not take the lazy path of just allowing Government to balloon, and deciding that every wasteful spending idea that pops into our head, whether it’s a cycle bridge across the harbour or a light rail train set—not every whim needs to be indulged.

16:30

Thank you, Madam Chair. I was interested in the discussion before around Investment Boost, because, given some of the forecasts, it’s clearly a very important policy. I understand that Investment Boost is projected to lift real GDP by about 1 percent over 20 years, with half of that coming in the first five years. I was interested in the Minister of Finance’s analysis of what would happen if Investment Boost was removed. What impact would that have on the Government forecasts and the ability for the Government to provide the revenue for the spending commitments that it needs to make for our public services?

16:31

The member asks a very good question, because, as parties put together their manifestoes and fiscal plans, they’d better be careful about counting in growth that will not occur in the absence of Investment Boost, because what Treasury and the IRD estimate is that half of the GDP growth that Investment Boost is estimated to stimulate will occur within the first five years of that policy. In the absence of Investment Boost, therefore, you would expect half a percentage of GDP growth to be wiped off this economy over the forecast period. With less growth comes less revenue, and in terms of growth, we are talking about having GDP billions of dollars less than it would otherwise be, meaning a significant hit to revenue.

Now, of course, on the other side of the House, what they like to pretend is that you can just tax people more and there are no consequences. In the case of Investment Boost, the consequences of removing it would be very real. We would see a lower rate of capital investment than would otherwise be the case, lower productivity growth, lower GDP growth, and lower wage growth—

Of what uptake?

—with those effects most pronounced in the next five years. I put it to that member that that’s why this is such an important policy to maintain, because our economy absolutely needs that stimulus to wage and job creation over the next few years.

16:32

Just reverting to an earlier discussion: for the benefit of the Minister of Finance, my PhD is actually in philosophy—the study of argumentation and logic—and it’s very helpful for noticing when people are obfuscating and not answering questions. I’d just like to point out that the Minister has not yet answered my colleague Chlöe Swarbrick’s question about the liquefied natural gas terminal, the Minister has not yet answered my colleague the Hon Dr Megan Woods’ question about the drawdown on the contingency, and she has not yet answered my question on why 1 percent is considered to be the appropriate size for the Public Service.

Chlöe—

Madam Chair, you don’t need a philosophy degree to look at—

I’m sorry, but I had started to call Chlöe Swarbrick.

16:33

It’s very interesting: we’ve just had the Minister of Finance agree with the Green Party that without investment, there is no growth. I guess that this is where there is that kind of dividing line where we have the opportunity to meaningfully invest in the things that will increase our productive capacity as a country, and also to reduce our exposure to imported fossil fuel inflation. I really, really want an answer from the Minister of Finance here, because I think it is critical for the sake of future infrastructure planning for us as a country, but also to that point of resilience and sustainability, and our exposure to imported inflation: can the Minister please make it absolutely clear to the committee that we are not potentially, at election time, going to be faced with a situation where this Government has decided to underwrite the liquefied natural gas import facility with taxpayer money?

16:34

A revelation that I hope can occur in this House today is that Chlöe Swarbrick will recognise that the Government is not the only source of investment in the New Zealand economy. In fact, the biggest investors in the New Zealand economy are actually in the private sector, which is why it is so important that we have in place policy settings that encourage them to make that investment, and the means we have available to us for doing that are multiple, not the least regulatory. For example, the Fast-track Approvals Act will allow major investments to be made in renewable energy generation and housing and in quarries that would otherwise not be able to occur. By regulating more carefully, we can ensure that billions of dollars of investment are unleashed in the private sector.

The second way that we can encourage the private sector to invest is ensure that they actually retain some of the profits of their investment, which is why things like having a wealth tax are a dumb idea, because what that says to them is “Take your dollars elsewhere.” So let’s head that moment of comity in the committee of the whole House today—that we can agree that private sector investment is important to the New Zealand economy.

In answer to the member’s question, as has been stated by the Minister for Energy multiple times: the liquified natural gas investment is still subject to a procurement process and no final decisions have been made.

16:35

Thank you, Madam Chair. Ki te ōhanga Māori—moving to the Māori economy: does the Minister stand by the Government’s commitment to double the Māori economy by 2035? If so, why have Māori economy’s sales fallen 10 percent, exports have fallen 17 percent, and 1,070 jobs have disappeared in a single year, with Māori employment now at 10.8 percent? What tangible investment can the Minister point to that is going to turn around the 2½ years of decline that the Māori economy has seen under this Government’s watch?

16:36

Absolutely we are committed to our ambitious goals for the Māori economy, and let me point out to the member some of the sources of that growth. Actually, the Māori economy has a significant proportion of land-based and primary industry - based businesses, which are undertaking, at the moment, an export boom. We are seeing higher prices for our diary, for our meat, for our kiwifruit, and for our apples, and we are seeing more of those products being sold overseas. Our Government is supporting that, not only by reducing the red tape that farmers need to untangle themselves from before they plant a single vine, but we are also ensuring they have access to new markets. I want to acknowledge the member’s party for supporting the New Zealand - India free-trade agreement, which is an important part of that.

Māori businesses will also be significantly supported by the Investment Boost tax credit, which will ensure when they make investments in their own growth, whether that’s in a piece of machinery, a piece of technology, they will pay a lower tax bill that year as a result. So, yes, we remain committed to growing the Māori economy. We are committed to policies that support Māori firms and businesses to invest, create jobs, and grow incomes.

16:37

We’ve just had what I think is actually quite an explosive admission from the Minister of Finance just then, when she said that no final decisions have been made and, in fact, she was pretty ambiguous about whether there is the potential for there to be a taxpayer underwrite to the tune of $1 billion for a new liquified natural gas (LNG) import facility just a few months before the general election. If that were to happen, that would bind our country to more fossil fuel imports and, therefore, expose us to more imported fossil fuel inflation into the future. But, look, if the Greens were to be taking the National Party election strategy here in the way that they seem to contort every single piece of information about tax policy or economic strategy, we here would be putting up in billboards and lights the fact that the National Party is going to be investing $1 billion of New Zealander’s money in a new LNG import facility, just to really underscore exactly how profoundly insane the situation is that we are in this election, with the lack of willingness to engage honestly and truthfully about the economic propositions that are before us as a country.

So given that the Minister of Finance clearly so desperately wants to talk so much about tax, let’s talk about what the Green Party is actually putting on the table in contrast to the tax system and the economic strategy that this Government perpetuates and upholds, and, yeah, with regard to the time that is available to us, let’s be really clear that what this Government has spent its time doing has been entrenching deep wealth inequality. Right now, they know that the average hard-working New Zealander—our hairdressers, our waitresses, firefighters, nurses, teachers, doctors, and almost every regular person who is tuned into this debate—is paying double the effective tax rate of the wealthiest in this country. But it’s clear who this Government serves, and it is not regular, hard-working New Zealanders, whom this Government sees as an opportunity to underwrite their billion-dollar LNG import facility to the detriment of all of us and of a safe, stable climate for future generations.

Is there a question?

16:40

Well, I mean, the only explosive thing about that was the explosive volcano that is unleashed when the Greens get the chance to talk about their list of taxes. Let her count the ways. Look, as the Estimates clearly show, there has been no taxpayer funding commitment made to a liquefied natural gas facility, nor could there be when no final decisions have been made to advance one, because it is subject to a procurement process. There’s nothing explosive about that. If the member wants to take more opportunities to list all of the new taxes she wants to introduce to drive investment and jobs away from this country, she is welcome to take as much time as she likes, because I’ll tell you what: that sort of economic recklessness and vandalism is not what the New Zealand people want.

Point of order. I’m seeking leave of the committee to have extra time afforded to the Green Party for the sake of us having that meaningful, evidence-based tax debate.

No.

No.

Well, let me put it. Leave is sought for that purpose. Is there any objection? There is.

16:41

Thank you, Madam Chair. I’m just returning to my questions and reminding the Minister of Finance that, outstanding, we had the questions around whether or not any advice has been received, or whether any Cabinet committee or Cabinet has considered any uses of the $450 million contingency fund that sits in the Budget. The other question I would like to ask the Minister is: has she had any update from IRD around Investment Boost and around the 1 percent increase in GDP growth that is forecasted as a result of that policy over 20 years and whether she’s had any updated advice on that 1 percent? She’s saying—and indeed a number of the documents and certainly the documents accompanying the Budget said—that you could expect some of that growth to be front-loaded in the first five years and that it wouldn’t fall in a linear way, the 0.05 percent per year, if you annualised it over 20 years. So, if she can give us some updates within the first five years about how it will perform against the linear path of 0.05 percent growth, and, likewise, in terms of the projections around wage growth from Investment Boost, which is a 1.5 percent increase in wages over 20 years. I think most workers sitting out there would be looking for something more than a 1.5 percent over five years growth in their wages, but this seems to be the only policy that this Government and this Budget is hanging its hat on in terms of anything to do with wage growth and in terms of making life better for workers. So, if the Minister could give an update of any advice she has received in terms of the filings and how that is tracking and what that looks like.

16:43

I’m sorry I have to spell this out to the member, but that is wage growth additional to the wage growth that would otherwise occur. It’s not the only wage growth that will occur, but it’s wage growth that you can bet your bottom dollar won’t happen if Investment Boost is withdrawn. As to Treasury and IRD’s estimates of the impacts on GDP growth and wage growth, all of the advice that I have received stands by those estimates. It’s very important to note that it is a matter of comparing what would have otherwise been the case, and that is difficult to do. As I have highlighted, we have not yet had the full year’s tax returns for a year of Investment Boost, so we don’t have the data. Even if we had the data, it is difficult to know how much of that investment would otherwise not have occurred.

What we do know is that in the absence of this policy, New Zealand businesses would be paying more tax. If they were paying more tax, they would have fewer dollars available to them for paying their workers and making investments in their own growth and expansion. You can cut it 50 ways, you can talk about your percentages and your incremental and your linear, but if you’re getting rid Investment Boost, you are taxing businesses more. This investment credit is worth $6.6 billion to New Zealand businesses over the forecast period, and in its absence, those businesses would be paying $6.6 billion more in tax. That tax would be, in the case of the Green Party, spent on phantom, crazy, fantasy projects; in the case of the Labour Party, probably wasteful Government spending. Our argument is a simple one: let those businesses retain more of their earnings so that they can make investments in their own workers, their own technology, and their own expansion, and strengthen the New Zealand economy.

16:44

So, based on that response by the Minister, if you rewind Investment Boost, it therefore increases the tax impost on a business. What are the tax savings, therefore, from the year, given businesses pay provisional tax?

Madam Chair.

Cushla—

Supplementary. Quite clearly—

I’d started to call the member Cushla Tangaere-Manuel.

16:45

Thank you, Madam Chair. Has the Minister requested or has Treasury provided any advice on the 10 percent fall in Māori authority sales and the loss of 1,070 jobs; if yes, will the Minister release it and, if no, why has she not requested that information?

In answer to the member’s question, no, I’ve not received advice on that matter. In addressing member Edmonds’ questions, let me spell it out again for the member, because I don’t think she has understood it the first, second, or third time I’ve explained it. The Investment Boost was introduced on 22 May 2025 and was, therefore, applied for the first tax year through to 1 April 2026. We do not know how many people claimed the Investment Boost tax credit in that year for a simple reason, which is that most firms in New Zealand use a tax agent to make their tax claims and have up to 12 months after the tax year to make those claims. As is always the case, the majority do not make their tax filings until a year after the completion of the tax year. The simple reason that the member’s questions can’t be addressed in factual detail is that the claims have not yet been made.

Well, “the majority”, you said.

Now, the member can mutter under her breath as many times as she likes that she doesn’t know. Well, the IRD do not have that information yet, because people haven’t made those claims yet.

16:47

I just want to help the Minister out here. It is the case that terminal tax claims have not been filed and things like that, but provisional tax returns will have been coming in on an ongoing basis—the provisional upfront payments that businesses make during the year—and so that provisional tax data ought to be giving some indication of whether Investment Boost is actually being used and what kind of an impact it is having on the final tax paid—

No, no, no, no.

Trust me. I know about the tax system. There ought to be some data available. I would also like to point out that, as the Minister referred to herself when she was in front of the select committee, there was some survey data from Inland Revenue. The final set of that data was due to be coming in in about April, and there should have been reports back on it by now. There ought to be at least some evidence available, both from that survey data and from the provisional tax payments that have been coming in, to give the Minister an indication as to how effective Investment Boost has been. Where is that information, Minister?

16:48

Well, it’s a sad Wednesday afternoon when a Labour Party member has her hand on her hip and says, “Trust me. I know about tax.” You know what follows. I can tell you what she knows about tax. In her view, more is always better. I’m afraid that the member and I are not going to agree on this point, because the simple reality is that the Investment Boost tax credit has been introduced. Yes, the survey data indicates that a significant proportion of firms have brought forward investments they wouldn’t have otherwise made or expanded investments, and a significant proportion in the survey data indicated that they had or intended to use Investment Boost. However, that is survey data. For the final information, we do need the final tax returns. It is the case that IRD have ensured that those tax returns include a data field which asks people to identify the volume and value of investments that they made that they claimed the Investment Boost tax credit for. We will know that data after the fact. We just simply do not have that data at this point. I can tell you one thing definitively and clearly: as a result of the Investment Boost tax credit, businesses in the last tax year will have paid less tax than would have otherwise been the case. The member can wish that away, or she can just be clear and candid, which is that she wants businesses to pay more tax.

16:50

It is quite clear, when you have a Minister who says they’re going to save a significant amount of tax and yet the member just before asked, “Well, how much?”, that she doesn’t actually know. The Minister doesn’t actually know. No idea. Therefore, given there was a survey—and we’ve read the survey—I want to ask the Minister: of that significant proportion that have actually changed their investment decisions because of Investment Boost, how much was that percentage of those that actually did the survey? From my understanding, only 7 percent of those that did the survey said it was significant, and 53 percent said that Investment Boost doesn’t actually affect them.

Therefore, if the Minister is claiming they don’t know how much yet from Investment Boost and yet was asked just before how much it was—she said, “We don’t know yet, because the filing data.” Well, which particular filing data are you talking about? Are you talking about the IR10, the annual financial statements, or are you talking about their provisional tax, which is done three times a year? I’m getting a bit confused by the Minister here because she’s conflating a number of different filing obligations in order for us to get the information around how effective Investment Boost is, given her claims that it will have significant impact on them. Yet a survey result shows the complete opposite of that. Can the Minister provide the House with the answer to how much has actually been drawn down from Investment Boost for the last year? Her comments that the majority—you don’t know? Well, then, what is the minority, if you do know that?

16:51

I’m very happy to address the member’s question, although I’d suggest that she’s given me a spade with which to dig a hole she is going to fall into. What the IRD did was they threw forward estimates of the amount of investment that would be made by firms and how much their tax bills would be reduced in each of the years in the forecast period. The amount of less tax that businesses will pay per year as a result of Investment Boost—let me spell it out to the House: in the 2024-25 year, $208 million less in tax; in the 2025-26 year, $1.830 billion less in tax; in the 2026-27 year, $1.6 billion less in tax; in the 2027-28 fiscal year, $1.7 billion less in tax; in the 2028-29 fiscal year, $1.3 billion less in tax.

Now, the corollary is also true, members. If Investment Boost were removed, let me tell you how much more tax businesses would be paying. Well, this very fiscal year they’d be paying $1.6 billion more in tax. Next year, they’d be paying $1.7 billion more in tax. In the 2028-29 forecast year, they’d be paying $1.3 billion more in tax. What kind of a finance spokesperson would promote that if they want to grow this economy?

16:53

I would like to—[Interruption]

Just a minute. I can’t hear myself think.

Thank you, Madam Chair. Of course, the point of Investment Boost is that it accelerates the depreciation right off, so it brings forward a write-off—20 percent in the first year—and then it decreases the write-off in subsequent years. Given that the Minister has said that businesses will pay X amount less in tax in the immediate years as a result of Investment Boost, how much extra tax will they be paying in the out years as a result of the decrease claims they can make in those years? The Minister needs to be clear that this is a cash-flow advantage only. Oh, the Minister doesn’t know. Perhaps I’ll sit down, and someone else can take the call.

Well, if you ask a silly question, expect an answer that will be very simple for the member to understand, which is this: the Investment Boost tax policy reduces people’s tax bills in the forecast period, meaning that the time value of money is significant and they have more funds available to them in the short term than would otherwise be the case. What IRD and Treasury advise is that, as a result, they will have more cash available to them to do the following things: pay their workers more, invest in more equipment, expand their growth, send their products to new markets, and do any number of things which will be good for the economy overall. Here’s the thing: rather than imposing new taxes and increasing taxes, another way that you can increase revenue is by growing your economy more by growing your businesses more. The Investment Boost tax policy will allow businesses to grow faster, and we say that’s a good thing.

16:54

That was interesting. While the Minister waits for a text from her adviser to provide the answer for Dr Deborah Russell’s question, the question I have in relation to the last year, therefore—given that the Minister has said that Investment Boost will provide more employment—is: how many jobs have come online as a result of that Investment Boost, given her claim and given unemployment is now at a 11-year high? The fact is that it’s supposed to bring in more employment, and yet unemployment is higher. How many additional jobs in the last year, therefore, given the Minister’s claims have been brought on as a result of Investment Boost?

It’s under 3 percent in Otago; 3.7 percent in the South Island.

Sorry, what was that, James Meager?

The debate isn’t across the Chamber, members.

He was just trying to correct me. My question is: given unemployment figures, how many more jobs have been added into the economy as a result of Investment Boost decisions and businesses accessing Investment Boost?

16:56

We’re now entering the dregs of the debate where we enter endless repetition. I repeat two points that I’ve made ad infinitum. The first is that it will be difficult to disaggregate the effects of Investment Boost from any of the other wonderful, pro-growth policies which this Government is implementing, from advancing fast-track developments to implementing new free-trade agreements to reducing red tape and regulation and to better educating our school leavers. That would be a difficult number for any serious scientist to come up with.

The second point is this: in terms of how many claims have been made using the Investment Boost tax credit, we will not know that until the final tax returns are in.

Well, seeing as the Minister doesn’t really want to explain anything further around Investment Boost, I want to go to some of the general economic figures. Perhaps the Minister could explain this. I have, sitting here, the Pre-election Economic and Fiscal Update (PREFU) from 2023, and at that time, the forecast GDP growth for the 2026 year was 3.3 percent, but sitting here in the Budget Economic and Fiscal Update (BEFU) from this year, the year for which the Minister has been responsible, it’s 1.2 percent. Could the Minister explain the difference in those figures and why, under her watch, growth is much, much lower than it was going to be under the watch of the previous Government?

While she’s at it, perhaps she could explain why, in terms of the operating balance before gains and losses (OBEGAL)—they’re not actually reporting the OBEGAL figure, because they’ve gone to her own special little operating balance before gains and losses, excluding ACC revenue and expenses (OBEGALx) figure. With OBEGALx compared to OBEGAL, it shows that there was a considerable decrease in OBEGAL from when the Labour Government was in charge until when she’s been in charge.

We could add, to that, inflation. Inflation was due to be down at about 2.1 percent in PREFU 2023, and, now, under that Minister’s watch, inflation for the 2026 year is predicted to be something like 4 percent—well out of the band.

Let’s do it one more time with some other sets of figures. We always knew unemployment was going to be trouble and difficult for a few years, but by this time, according to PREFU 2023, unemployment would be starting to track down. It would be at 4.8 percent, but on her watch, unemployment is sitting at 5.5 percent, and that’s without taking into account all the New Zealanders who have fled overseas. The Minister needs to explain why things are so much worse on her watch.

16:58

As we have traversed at the Finance and Expenditure Committee and as the Treasury have acknowledged, their forecasts at Pre-election Economic and Fiscal Update 2023 were overly exuberant, and they subsequently pulled back their productivity expectations and their growth expectations. Essentially, in their analysis, they overestimated the bounce-back after COVID, and as the real data came in, they then adjusted their forward forecasts. In addition, we have of course had a global tariff war and the biggest oil shock in recent history. In terms of what the economic indicators show, under the last Government, core Crown expenses went from 27.3 percent in 2018 and leapt to 33 percent in 2024. On our watch for the only year for which we have final figures, which is the 2025 year, those expenses reduced to 32.6 percent. In terms of debt, debt was 19.5 percent in 2018. Under the last Government, it had more than doubled to 41.7 percent by 2024.

Despite the ravages and the challenges of the global economy, and despite the massive interest bill that we inherited from the last Government, which is now totalling around $9 billion a year, on our watch, debt has only increased in the final year for which actual figures are available—2025—by 0.2 percent: going from 41.7 percent to 41.9 percent, which I think the member will acknowledge is a far lower level of growth than the 19.5 percent to 41.7 percent that Grant Robertson managed to achieve.

Members, the Minister’s time in the chair has come to an end.

17:00

Thank you, Madam Chair. The Governance and Administration Committee met on 17 June to hear evidence on the appropriations within Vote Cities, Environment, Regions and Transport, which are the responsibility of the Minister of Local Government. The Minister of Local Government, as I said there, is responsible for six appropriations totalling about $126.1 million in 2026-27. This is roughly a quarter of Vote Cities, Environment, Regions, and Transport: $523.1 million. At the hearing on 17 June, we heard a lot about simplifying local government—the Government’s Head Start pathway—and the backstop process. We heard also a lot about city and regional deals around water services and the Government’s plans around what is happening in that space, but we also covered off some other areas as well, including cost to councils to simplify local government, transition of local government functions to the Ministry of Cities, Environment, Regions and Transport and strengthening environmental resilience.

We welcome the Minister here now, and I know that there are lots of questions that people want, so I’m keeping my part very short because we only have a short time. So I’ll leave the introduction at that.

17:02

Thank you, Madam Chair. I have a question around Taumata Arowai, obviously a Crown entity and our country’s national water regulator. The Government has budgeted $4.642 million for this financial year, yet the councils are contributing in levies, $20.658 million, this financial year but it’s actually for three financial years in a row, and we’re not too sure what it will be after that. That represents 80 percent of the total levies to run this organisation. If I look at, for example, Christchurch City Council, their contribution is $1.6 million, which obviously represents a significant increase in rates. I’m sure the Minister is aware of the impact on rates when it involves operational spending. So my question to the Minister is: why have councils been forced to be the primary funder of the operations of a national regulator that the Government has created?

17:03

Thanks, Madam Chair. I appreciate the opportunity. I’d like to ask Minister Watts, in terms of local government: elected local government is being abolished and without telling anyone what replaces it in terms of what was given to the committee. Regional councillors will not be elected in 2028. What sits in their place? We have been advised as a committee that there will be a board of mayors, Crown commissioners, or some hybrid system that has not yet been decided by Cabinet.

So my question is: in terms of the central democratic question, what has been planned? How will the public know, in terms of the system, if one system is being abolished and we are used to nationwide local government elections—I want to understand what type of system, what will be the public consultation in a very short time, what will be the envelope, and who will make those decisions in terms of that new system?

17:04

Well, thank you very much, Madam Chair. Good afternoon, fellow members. It’s an honour to be the member, and also the Minister of Local Government, and to be entrusted with this portfolio that is delivering for New Zealanders. We’ve had a number of questions there, one in regard to the water regulator and the levy model, and also another question in regard to regional councils. In order to set the context before I come to those two points, I think it’s important to acknowledge that there has been significant reform in the area of water services. The reform is focused on more flexible, cost-effective, and financially sustainable water services, and that is a priority of this Government.

The Local Water Done Well programme has seen all councils prepare water services plans, which provides them with a clear pathway to put in place the infrastructure required and the investment needed. The overseeing and the implementation of these plans is a significant task for the Ministry of Cities, Environment, Regions and Transport (MCERT), and I acknowledge my MCERT officials here with me.

In regard to the question around the levy for the water regulator, it is common practice across other sectors within our economy that the funding of those regulated entities is provided by those entities that, in effect, are the users of that. In this case, they are the local government mechanism. The regulation applies to water quality standards and, more broadly, around the efficiency in the context of water as well. So that is how it is.

In regards to the regional council model, the member is right to acknowledge that the Government has a wide-ranging reform programme in regard to the reform and simplification of local government. We’re working our way through that at the moment, and it’s pleasing to see that a number of councils have made voluntary submissions in regard to their plans to amalgamate. We’ll have more to say on that in the coming weeks to months, but in regard to regional council specifically, it is correct that these regional council elections will not occur again, and will not occur in the 2028 year, which is when they were planned to occur again. In effect, the functions of regional council will form part of new amalgamated unitary councils across the country, and that process of transition will be happening over the period from now to 2028.

The destination is not 2028; it is a milestone on that journey and then the further bedding in of that reform will occur post 2028. Those councils that have selected into the Head Start process can expect that they will have their, in effect, amalgamated entities in law by midway through of next year. That will then give them a certain clarity to start that reform programme faster, which was the feedback that they gave to us through the consultation process.

17:07

Thank you, Madam Chair, and I’d like to thank you, Minister, for that. I would like to ask a follow-up on the question from my colleague from the Greens around Watercare and what is happening in the Local Water Done Well area. Now, we noted that the Department of Internal Affairs reported that councils’ water services delivery plans under Local Water Done Well predict that nearly $9 billion more investment is needed over the next 10 years. That was over and above what councils’ long-term plans forecast. Now someone has to pay for that, and I’m presuming that there has been household modelling and the impact on household modelling, and I’m very keen to know which and what the modelled household impact is. So, who really pays for that $9 billion and what is the forecast impact on the average household bill?

17:08

I just wanted to follow up on my questions around Taumata Arowai, and I appreciate the comments from the Minister. I guess I want to get some insurance that there’ll be no other Crown entities, departments, or agencies that council may end up having to fund some of the administration. I look at something like Waka Kotahi NZ Transport Authority, which obviously works within the local government space. I’d just be good to get some insurance that that won’t happen.

One of the things I also want to look at is we know that the Minister’s proposing to introduce a rates cap, and whether he would look to exclude these levy costs from councils from that rate caps proposal, and whether he’s willing to work across parties to actually look at some of the reforms that are currently happening that are posing significant costs on councils from the administration of them, and develop them. They could be looked from being excluded from the rates cap because we see, across the board, councils struggling to actually keep up with the pace of the reforms—but the cost to council is significant.

17:09

I thank the members for the questions. I’ll cover Watercare first and then come on to the broader reform in regards to rates caps. In regards to Watercare specifically—so this is the entity responsible for the delivery of water services in the Auckland region—it is probably one of the most significant and substantive examples of the success of the Local Water Done Well reform.

The mechanism changes in the Local Water Done Well reform is, basically, enabling the funding and financing to flow to the Watercare entity in order to undertake and embark on a significant capital programme and investment programme. That capital programme is in the region of $15 billion over the next decade. We all acknowledge that there is a deficit of infrastructure required and the investment required to do so, but the ability to decouple Watercare from the Auckland Council balance sheet allows it to have the flexibility to be able to borrow that, and, of course, it is offset with the ability to collect revenue from water connection charges to offset that borrowing. So that has really unlocked probably what is one of the most fundamental significant reforms of the ability to invest in water infrastructure in New Zealand in the past generation, I would go as far as. The savings, particularly in Auckland’s case, are $900 million as a result of the Local Water Done Well reforms, and that is answering the member’s question.

In regards to the rates cap point, the member is asking around the interest around bipartisanship. I can give the member certainty in the context that it remains the Government’s intent to introduce legislation in regards to a rates cap model. We have spent an extensive amount of time consulting and working with the broader industry around policy design considerations for that model to work in practice, taking into account learnings such as Australia and where they have learnt from that. As and when it is introduced, it will go through a select committee process, and I would welcome interactions, support, and thought around that across the House. It is my view as Minister of Local Government that any legislation that we look to introduce, particularly new legislation such as a rates cap, is enduring. Therefore, it would be appropriate for us to ensure that that legislation is well considered and deals with the underlying issues but also provides the mechanisms and the safeguards to deal with, say, natural events and disasters where there are exceptional circumstances and we need a mechanism to deal with that that is built into the design of that legislation. We’ll embark on that process in the future.

17:12

Thank you, Madam Chair. I want to thank the Minister of Local Government for his earlier replies. Minister, I want to understand, in terms of the interim body, if the elected regional government is abolished, there’s not much time, and you’ve kindly explained that in probably about mid-2027 there will be the appointment of that interim body. Minister, can you please explain, in terms of the final design of the new set-up, with what the public understand, what will the education package to the public be in terms of consulting the public up and down Aotearoa that there is going to be a new body in the interim, there will be an appropriation for Parliament, and there will also be a completely new system—what consultation will there be done?

I have a number of questions in terms of the consultation, because it is important that when there is such a fundamental change in the new system, there is a serious component in terms of the planning of the design of the new system. It needs to be asked how public consultation will be done for voters of Aotearoa so that they can understand the reform programme.

But I also wanted to ask, Minister, if you could explain: has any assessment been made to the risk of regional planning capability in the abolishment of this current system to the new system because of the cost of living increases? What will worry people in their local communities is the cost of a new system. There will be the processes through Parliament in terms of legislation directed and designed by the Minister and officials and the impact of that new system being understood clearly by communities across Aotearoa.

17:14

Thank you, Madam Chair. Madam Chair, just because we’ve got a short time and it is jumping around a bit, but I do want to move to the city and regional deals from my questions, if that’s OK. This is something that’s been a particular interest for me, of course, coming from the Western Bay of Plenty, and that is one of the first areas where one of the city and regional deals were signed.

Minister Watts, you told the select committee at our hearing that pursuing Head Start does not affect a council’s eligibility for a city and regional deal, but that a region that has been through Head Start is likely to meet some of the prerequisites, such as the ability to coordinate as a region and produce a clear growth plan. Now, to me that seems a little bit of a contradiction. It seems like amalgamation is formally irrelevant to eligibility, but it’s also practically advantageous, from that quote. Councils have understood the message. It seems like it converts a voluntary pathway into a condition of access to funding. So I would like some comment, if the Minister thinks and believes that that’s true. Just to clarify that, because it did seem very contradictory during the committee hearing.

17:16

Yeah, I’ll come to the member’s question in regards to the broader city regional deal and the relationship in that context, just to clarify. I just want to acknowledge the member’s contribution and support. These regional deals are 10-year deals. They will span the political spectrum, and you’ve seen that in the UK, where they’re now 20 years ongoing. The importance of having alignment around the key aspects that are going to benefit our cities and regions are important, so I do acknowledge that across the House.

The assessment that the member is stating is not my view. It is not a prerequisite that the amalgamation of the councils is a prerequisite or a requirement of a city regional deal. It is, obviously, in terms of the criteria for a city regional deal being considered, a helpful example of how well in practise a region is able to work together. I think that is the point that is noted for those regions that have not yet negotiated or are negotiating a city or regional deal with the Crown, it obviously is advantageous to be able to signal their ability to work together, and that is important.

In the case of the Bay of Plenty and those aspects, the groupings of councils which were party to that agreement met the criteria in regards to that, and as a result the deal has been signed. So what they choose to do in regards to the amalgamation of their council positions or not is subject to their choice at this point. Western Bay and Tauranga did not participate in the Head Start proposal programme, and therefore, by virtue of that, they will be subject to a backstop process.

In regards to the questions around timing around that, because I think this is very important, Head Start proposals were due on 9 August. Government decisions around proceeding with any detailed design of those will be made in September, with final decisions in regards to that in 2027. It is the expectation that the detailed design of any backstop process will not be made or determined until 2027. And following decisions, legislation, and implementation of the successful Head Start proposals, then we will look to instigate the backstop process that will be developed and enacted in early 2028 and in place for the 2028 local body elections.

There was a question before around the entity body and when is it going to be in place. The entity body that’s been referred to will not be in place until 2028. What that acknowledges is that the backstop process will not apply until following the 2028 elections. Together with Head Start and the backstop, this will provide a clear pathway for reform for councils to move from where they are. Again, the Head Start proposal and pathway was put in place because we had feedback when we consulted with councils that a number of groupings wanted to move faster than the 2028 deadline. As a result, we created a voluntary mechanism to do that. Again, while I can’t be specific around the decisions off the back of that, we have been pleasantly surprised with the large number of 18 or so proposals that we received from councils across the country with an interest in looking to amalgamate into unitary groupings. That is important with a backdrop that we’ve only ever had one amalgamation in this country’s history in the last 35 years, which is one. To have 18 proposals in a voluntary process is not to be underestimated in terms of significance.

17:20

Tēnā koe, e mihi ana ki te Minita—thank you. I want to stay on the topic of local government reform. I have three questions themed around accountability to hapū and iwi Māori. Given that some councils are struggling to collaborate on local government reform, how will Vote Cities, Environment, Regions, and Transport and local government 2026-2027 ensure that councils are adequately engaged with and supported by local hapū, iwi Māori to collaborate and meet reform deadlines? Following that, given that councils aren’t able to successfully collaborate unlike their iwi Māori counterparts on critical reform, how does the Vote Cities, Environment, Regions, and Transport and local government 2026-2027 support partnership between councils who fail to collaborate across regional interests, opting to patch protect their own local interests and reform? The third and final question on this topic is regarding ministerial backstop powers. How much money has been allocated under Vote cities—under this Estimate—to engage with iwi Māori on the use of such powers to prevent reform failure?

17:21

So working backwards on those, the allocation of funding specifically to iwi Māori in regards to the Head Start proposal has been through baselines. There hasn’t been any significant allocation of funding actually to any groups or any entities as a result of this. What has been the case from the outset is that this has been undertaken first and foremost from the local communities and local groupings.

I just want to acknowledge the role of iwi Māori and broader hapū in the Head Start proposals. In many instances actually iwi Māori in particular have been more pro-reform in this area than potentially what some councils have been able to agree to. I guess that acknowledges that there is a clear understanding of the importance of getting to a point which is different to the status quo, and actually working more together as a region does have advantages which in many parts of the country iwi Māori have recognised in some cases before councils have got to that point of understanding. So that will continue.

There are other examples across the board where iwi Māori are very much aligned with the Head Start proposals that have been put in place. Seldom are there examples where there is large conflicting view in regards to that, which is positive. The view has always been that local councils have the best relationship with iwi Māori and their communities than central government, and they are best placed to do that. I’ve been very clear with my expectations to councils that they must engage in so in good faith and ensure that all people within the community including iwi Māori are at the table at a very early stage to ensure that anything designed is considered with all of the perspectives around that table from the outset.

17:23

Thank you, Madam Chair. I guess part of the reason why so many councils have entered the Head Start programme is because they’ve got one hand pushed up behind their back. I think this quote from the Hon Chris Bishop explains it quite well: “Lead your own reform or we will do it for you. Either way, change is coming.” So it was very clear that these councils were forced to do this Head Start programme, and to be fair, there are some councils that are in a good space to do it. But from a lot of the elected members that I’ve spoken to across the motu, they are being forced to do this and it’s been rushed too quickly and the community is not having their say.

What we’ve also seen from a recent report commissioned by Wellington was actually the cost to do this is extreme, and the cost for them over just a couple of years was $269 million. And my question to the Minister is: will these costs be excluded from those rates capping proposal? And will there be a mechanism for councils to seek reimbursements for this cost for because of a reform that this Government has forced upon them?

17:24

Thank you, Madam Chair. I’m sorry; I’m going to go back to the city and regional deals just to ask two follow up questions that I think I just want some clarification around. It seems that when I look at the appropriations of this portfolio, the total is $126.1 million, but the city and regional deals is described as unlocking funding for roads, infrastructure, and housing supply. So my question on this is what is the total funding committed under the Auckland and Western Bay of Plenty deals, and over what period, and in which appropriations do they sit for those deals? The other question I have, and I’ll just ask it now so that the Minister has it, is there seems to be a number of councils who are waiting with no decision that they have received. So I’d like to know how many regional deal proposals are awaiting a Cabinet decision, and does the Minister have an idea around when those councils will receive an answer?

17:25

Thank you, Madam Chair. I do want to go back just with a couple of follow-up questions for the Minister with regards to abolishing elected regional government. But one of the things, and the Minister has mentioned that there has been one amalgamation which is Auckland Council, and whilst there was a number of—there was a legislation and there were policies that came out under that amalgamation, it actually turned very messy because communities were not clearly informed as well as the elected members moving over to the new system.

My question to the Minister is: it has been signalled that there will be an interim period, and the Minister has explained that 2027, which then leads on to a 2028 time line—which will then be in line with the local government elections. Whilst it sounds good, can the Minister give assurance that that will happen accordingly, with respect to the new legislation? But also the Vote appropriation, can the Minister explain, in terms of the final design of the legislation, what exactly will Parliament be appropriating the money for?

17:27

In response to the questions first and foremost around the transition costs for all proposals, but in this instance it was referred to as Wellington, is that each of the Head Start proposals which are currently being assessed by officials, a number of them did include assumptions and indications around transition costs that may be considered or necessary by the groupings of councils in order to facilitate the transition. Officials are currently working in their way through that information. No decisions have been made by Cabinet in regards to what proposals will progress, nor whether any support will be provided for those transition costs. But it is currently under active consideration and we will release that decision as part of the information we do as noted in September.

The question in regards to the city regional deal proposals and how many more and are councils waiting; we did a first wave of that where we sought proposals and we made the decision to progress negotiations with three groupings, of which we have signed two deals, and we are imminent to sign the third deal in regards to that. We have no other negotiations currently under way. However, we have signalled to councils that post the Head Start process being reviewed and assessed by Cabinet, we may take a decision to open up a phase two around the city regional deals. We have not made that decision at this point. It’s still under active consideration.

Lastly, the question around the allocation of funding and around city regional deals and how much is allocated to both Auckland and the Bay of Plenty deal: as the member highlighted, the city regional deals include a wide range of portfolio implications, from health to education to roading and other aspects, and a number of projects and appropriations within that are either appropriations or they are intents to do something in the future, some of which are in the later period, so years seven to 10. It is not the case that there is a single number definitively that can be placed upon the totality of appropriation for a city regional deal because of the fact that some aspects of that appropriation and decision making is at different stages of design. So they also sit across multiple portfolios. So there isn’t a single allocation within the portfolio of city regional deals to fund that. It comes from respective Ministers, such as transport or health.

17:29

Thank you, Madam Chair. I appreciate the comments from the Minister. I just want to check if the Minister agrees, because we’ve had a lot of commentary about the level of rates increases from councils over a number of years and whether he agrees that the driver of increased rates over say the last five years has been insurance, interest rates, and inflation. And one of those drivers actually the council can control—it’d be great to get his opinion on that.

The other question I have is around this. As we know, councils are going through the Head Start process, which will see a number of councils merge. But also, at the same time, we have, I believe, 44 councils undergoing representation reviews due to legislation, and there’s the potential that there’s going to be a lot of money spent in that space, which obviously will be passed on to ratepayers. That may be redundant if they have to merge into another council. My question to the Minister is: what is the Minister doing in this space? Are there going to be some changes to actually allow councils not to do those representation reviews, or if they do them and they become redundant because they merge, will they be reimbursed those costs?

17:30

Just in regards to the question, in terms of the key drivers of rates increases in the country, the member is correct to note that we have seen significant increases in year on year rate increases; some jurisdictions up to 20 percent. Obviously, in your home region, double-digit rate increases, as well. The drivers of those are varied across the country. Obviously, high inflation historically has been a contributing factor, but one of the aspects is also the scope of what local government undertakes as a service delivery model. Currently, within the Act, it’s defined as “wellbeing”. It’s very difficult to define what is “wellbeing”—it pretty much could include everything. Legislative change that we will be putting through before the 24 September will define the core activities of local government across the key areas of rubbish, water, roading, civil defence, and parks and recreation, and there is a financial requirement, also, to spend money on those things first and foremost, before anything else.

As a result of that, and aligned with the implementation of a rates-capping model, we’re trying to, in effect, regulate those monopolies that will ensure that the increases in rates are at a level which is affordable for New Zealanders. In regards to the systems improvement bill, that is where that legislation will fall in regards to what are core services of local government. In regards to the questions around representation review, the member is correct that that is an area that has been highlighted from local government. It is something that I’m taking advice on, and I’m very open to thinking about how best to relieve that pressure on local government through, potentially, the Head Start legislation that we will put in place. I’ll have more to say on that soon.

17:32

My question is around the establishment of the Ministry for Cities, Environment, Regions and Transport, otherwise known as MCERT, and it’s to do with the funding for capacity and capability of the Crown to deliver on Treaty settlement commitments. One, how will this Estimate support MCERT to build any new capacity and capability to uphold Crown obligations to iwi and Māori, including Treaty settlement arrangements? What are the cost implications for Vote Cities, for this Estimate, to source new and to retain existing iwi Māori capacity and capability required to uphold obligations to iwi and Māori, including Treaty settlement arrangements? The third and final question on this topic is: what trade-offs will MCERT be required to make in its first year which may require weakening of Crown obligations to iwi Māori, including Treaty settlement arrangements.

17:33

Thank you. I do appreciate your comments. I’ve asked a lot of questions around the cost to local governments from these reforms being passed on to them by central government, which goes directly to ratepayers. There is the impact that’s going to happen with a rates cap, and, obviously, the fact that these reforms costs are going to have to sit underneath those things, underneath the rates cap. My question to the Minister is: will he commit to, where councils are spending money that is due to a central government reform—that that money will be excluded from the rates cap?

17:34

I do want to thank the Minister for his answers, but, Minister, I did ask an earlier question with regards to public consultation. Can you give an assurance that the changes—because these are drastic changes for the whole country, in terms of the reforms. Will the public consultation be done effectively in terms of the interim body and then the new system, and also how long will that interim period be?

In regards to the questions on public consultation in particular, it will always be the intent of the Head Start process—which is a voluntary process for councils to opt into—that it would be for those councils to undertake any engagement with their communities in regards to consultation and their proposals around what they’re looking to do as result of amalgamation. It’d be fair to say that there are a number of councils across the country that, for example, have undertaken and have held referenda on the decision of whether the communities want to proceed in that area or not, and it would be fair to say there is a range of views. But at this point, the Head Start is a voluntary process and we’ve left it for councils to undertake that conversation with their communities, and, again, of course, the councillors are democratically elected and therefore represent the views of their communities in that case.

The Head Start proposal, as I’ve said, will not conclude until 2028, and so there remains a significant amount of runway between now and then in order to continue discussions and to design and ensure that the model that is proposed and is implemented is fit for purpose for their communities. As I’ve highlighted before, I do have the expectation that there is active engagement with all stakeholders within the community to ensure that that reform is placed. We have only had one amalgamation of local government in the last 35 years, with the exception of Auckland. We are embarking, potentially, on a large number of amalgamations, and so I do not take that process lightly.

We do need to ensure that any reform that we undertake is enduring, is well-thought-out and well considered and that it does take into account the needs and requirements of the community. So the principles that apply to Head Start include things like protecting local voice, whether it is practical, and whether the efficiency is going to deliver value for ratepayers. In that context, that will remain the focus.

17:36

In terms of the Better Off support package, Minister, and the questions surrounding the role of iwi and Māori with these support packages, what input, if any, have iwi or Māori had in delivering the Better Off support package money for water infrastructure services? After receiving Better off support packages, how does this Estimate support local councils to deliver a new water services regime alongside iwi Māori as Te Tiriti partners?

A further question for the Minister is around improving departmental performance reporting now around the reporting aspects of the water programmes. The question is around the role of iwi Māori: if no allocation for involvement by Māori has been made under this Estimate, then what opportunities are there for iwi and Māori participation? What has been identified by the Department of Internal Affairs and/or Ministry for Cities, Environment, Regions and Transport that is non-financial? Further to that, one more: how does this Estimate ensure evidence of public value and departmental performance can be measured and demonstrated without hapū and iwi Māori at place?

17:37

I thank the member for the question. In the two minutes and 10 seconds remaining before the main event, I’ll keep this to within two minutes. The key element, I think, raised by the member is that the new Ministry for Cities, Environment, Regions and Transport, or MCERT, is that it brings together multiple agencies and multiple capability of expertise, particularly in regards to Māori advisory capability and teams within all of those respective agencies. We now have a singular agency where all of that capability is able to work together, and there are, obviously, opportunities and synergies to amplify that capability across all those agencies to derive better outcomes. That has been the intent of the formation of MCERT, and, to the member’s question around ensuring that there is appropriate investment capability and delivery in regards to outcomes for Māori, I’m confident that the MCERT model is going to amplify and ensure that that provision of information continues appropriately.

As I’ve noted to the member before, the design of Head Start has always been ensuring that those within the community that have a perspective and an interest in making sure that this works in practice are at the table from the outset to design the model that will work, and I acknowledge iwi Māori’s perspective across the country, where that has been very vocal and very positive and very constructive, and sometimes more advanced than, particularly, what other councils have been themselves. That is just the reality of where different groups are across the broader country.

But, overall, I’m very proud of the work that I’ve undertaken as the Minister of Local Government. We have embarked on the most significant local government reform that we have seen in this country in generations, and as a result of the reform which we’ve undertaken, that sets ourselves up for success. There is obviously more work to be done, but from this point forward, I am looking forward to continuing to do that.

Lastly, I just want to recognise the Hon Dr Duncan Webb for your valedictory, which is about to occur. Thank you.

Members, in accordance with a determination of the Business Committee, the committee is suspended for the Hon Dr Duncan Webb’s valedictory statement. We will resume this debate at 7.30.

Debate interrupted.

17:40

Thank you, Mr Speaker. [Applause] Easy on—just the once.

I don’t think you’re going to top that, so we’ll just call it there, shall we?

Yeah—call it a day. I will if you will, Mr Speaker. Ha, ha! Look, there’s never kind of a right time to leave Parliament, but I guess there’s one way to leave Parliament, which is by choice, and there’s the other way, and I guess I can just be lucky that I’m leaving by choice.

You do sometimes, I think, wonder, in the hurly-burly of this place, whether you have any impact at all, and I certainly know that some of my constituents wonder that as well. But it does make you reflect on why you came here, and I suppose that’s what valedictories are all about. In fact, Mr Speaker, it was your work in Christchurch that drove me to become a member of Parliament.

I’m very happy to be an inspiration to you.

Well, you did call me an ambulance chaser, and I might have called you a few things as well. But, look, when I arrived here, the scars of the Christchurch earthquake were very real and raw, and in my maiden speech I said that on the day of the earthquakes, the heart of Christchurch stopped beating. What drove me here, it wasn’t a big policy goal; it was actually quite personal. I still recall one incident that stood out, which was when a very old man in his 70s or 80s called my office and he was really apologetic to trouble us, because he didn’t really have any money. He said he’d been living in a caravan in his backyard in east Christchurch for two years because the Earthquake Commission (EQC) hadn’t come round to assess his badly damaged home and he didn’t have any sanitation—was that OK? It wasn’t, and that’s one of the reasons I chose to come here.

I do want to recognise some of the young lawyers I worked with back then who worked really hard on cases like that to change the lives of people who really needed help. Some of them are here today, and that was a team I was proud to be part of. But I joined a different team—I joined this team, and it’s a team I have loved working with. When we came in, we were focused on the Christchurch earthquake and what had happened there. Certainly, the Christchurch MPs were.

When I look back, and I see that we launched a royal commission into EQC—that actually did change the culture of EQC in significant ways. We created a claims resolution service that still exists to assist people through natural disasters, we established an earthquake tribunal, and, perhaps most importantly, we established the On-sold programme which meant that people got their houses and their dodgy EQC repairs fixed without having to go through court. They were all transformative changes for the people of Christchurch. That earthquake story isn’t finished. People are still struggling 15 years on, but I think we’ve changed the focus to what it should be, which was on the people.

Another project that I was involved in was an innocence project in Christchurch, and it was great—and I’ve got Andrew Little here in the House—to see the Criminal Cases Review Commission established. I think sometimes, as a party that’s been in Government, you can focus on the reversals instead of some of the changes that have really stuck, and I do think that they’re just some of the changes that I came to Parliament wanting to see happen, and indeed they have. So I think that’s something I think we can all be really proud of.

I know we all come here with the vision of making people’s lives better, and we disagree what that might mean, sometimes fiercely. But I do worry sometimes that we don’t give enough weight to community, culture, recreation, and art, and we value a society where every spare hour is spent working to make ends meet and we miss out on friends and family and the things that really matter. It’s the tyranny of accumulation.

I want to recognise the work that Grant Robertson did when we were in Government. He really understood the importance of what mattered, and I think his Wellbeing Budget was a transformative way to look at how we manage our economy and make a fiscal plan. I know that this Government hasn’t continued along that road, but I think the foundations are there. The work’s been done, the knowledge is there, and I hope that in future Governments, we will go back to asking the question of how we make people’s lives better through the Budget process.

When I got here, I was sitting over there on the Government benches, and when I did my maiden speech, I stood up and said, “I’m a member of the Labour Party. We believe in democratic socialism. I am a socialist.” [Applause] It’s good to see that that line still works. I was surprised to get a cheer because I actually didn’t think I was saying anything particularly outrageous for a Labour Party member. I suppose I shouldn’t be surprised that the word “socialism” sends a shiver up the spine of some people on the other side of the House, but to me it’s not an ideology; it’s an approach.

It’s not necessarily about State ownership or things like that; it’s just about the idea that where you start, someone’s circumstances of birth, should not be determinative of their course in life. Out there in the real world, we see people with the compassion and humility and humanity that they bring to their lives every day, and I think that’s the kind of socialism we should be bringing into this House.

I guess policy, for me, is personal. Perhaps it comes from all that time I spent in church, but when I see jobs being cut, emergency accommodation being harder to get, and support for disabled people being taken away, I wonder if we should frame it as some old bloke did a very, very long time ago, when he said, “In so far as you turned away the least of them, you turned away me.” That seems to me to be a sound basis for public policy.

Sometimes we spend far too much time sitting down and not enough standing up, and as the election rolls around, I think we should ask each of us and each of the parties who we’re standing up for. Some groups and people are easy to stand up for, but some aren’t. When I think of the homeless, people in prison, unemployed, and youth offenders, I wonder who’s standing up for them, because if it was easy to stand up for them, we wouldn’t really be needed in here anyway, would we?

I do want to recognise what a huge privilege it is to be in this House, and I really appreciate the confidence that the people of Christchurch have put in me. One of the jobs I really quite enjoyed was being chief whip—[Hon Kieran McAnulty laughs] I did!—of 65 MPs—oh no, 64.

Too soon—too soon.

Ha, ha! Of course, one of the jobs of a chief whip is to not get a great deal of attention—if you do get attention, you’re doing the job wrong. But it was a real privilege to manage a large caucus in a way which let the Ministers in Cabinet do their job and to make sure that the backbenchers were meaningfully engaged in supporting that ministry. I want to give a shout-out to all the whips past and present: keep it up, keep out of the news.

Most MPs’ names don’t hit the headlines—mine included—but I do want to recognise the importance of every MP that comes here, both in their own caucus and in ushering through important legislation. I can actually remember a real sense of pride as we sat in the Environment Committee passing the zero carbon Act, thinking this can change the direction of climate change in New Zealand and the world. That is something which is a very special place to be, and it happens here a lot.

I was also very lucky to be given a ministerial role, as Minister of Commerce and Consumer Affairs. It’s not glamorous, and that’s probably why I got it, but I actually did really enjoy the work there, particularly the consumer-oriented stuff, and, obviously, the insurance contracts bill that Andrew Bayly mucked up, and I actually thought that was an important piece of work that’s going to change a lot of what goes on in New Zealand. I did learn, in that role, that banks, supermarkets, insurers, and the like are articulate, well organised, well funded, and very close to Government. Any Government needs to work equally as hard to hear from those on the other side of those conversations, and there’s still a lot of work to do there.

It is usual—don’t worry, Mr Speaker. I’ve spoken to Matua Adrian Rurawhe, and he said I can take as long as I like. No, look, it’s usual to thank a few people in these speeches, and I suppose I should. Firstly, Suzanne, who’s tolerated me and nine years of politics, which isn’t easy—it’s probably more public service than anything I have ever done. Thanks for your patience and your wisdom and for keeping me grounded and for all that time that I’ve taken from you. My kids are here. Albert, Lewis, and Felix keep it real and treat me with disdain and scepticism! Only young men can master that, but it’s been really important to me to have them, and it’s great that they’re here tonight.

In Christchurch, Sonya Rowell’s been my electorate office manager since 2017, and that’s quite some feat. Some people say we’re like an old married couple, but I didn’t think it was quite that bad. Thanks to her and all the many staff who’ve helped me in that office. Of course, there is the Wellington crew. Frank, Marleen, and Casper have helped me as executive assistants here and have tried to manage the chaos. Also Claire Szabo, who’s here today as well. She was my ministerial adviser, and she really looked after me. There were a couple of occasions—or perhaps more; I’m not quite sure—where she disappeared letters that I had written handwritten responses to people on, telling them what I really thought. They would appear the next week as clean copies that were safe to sign. So thanks for that, Claire. You didn’t save the Government, but you did save me.

Politics is a local activity, and I want to thank those people who helped me on the ground. When I started campaigning in 2017, John Key was Prime Minister, and Labour, to be fair, was in the doldrums. Christchurch had a National MP, and people thought I was mad to give up a job in law and come here—they may be right. By election day, much had changed. Bill English was the leader of the National Party, Jacinda Ardern was our leader, and a rising tide lifts all boats, but I was also lifted by absolutely hundreds of not just Labour Party members but supporters and friends who had a belief in me. That is a huge thing, so I want to thank them all. They are truly too numerous to name. Some of them are here tonight, but thank you very much.

The only one I’ll call out is Aaron Campbell, who’s here today. He campaign-managed three campaigns. He’s got an eye for detail, an energy, and an obsession that pays absolute dividends. Thank you, Aaron. Of course, every campaign gets the odd disgruntled volunteer, but not every one becomes a National Party MP—thank you, Vanessa Weenink.

I also want to thank the people of Christchurch for your support, because I don’t think a constituency MP can actually do the job unless they have a fairly broad base of support across a broad section of their community, across party political lines, and obviously, as a constituency MP, you want to see the best for all of your constituents. I think that it’s been a real privilege to work with business, with community groups, and with schools across the board in Christchurch. It’s been a real honour to be the MP for a fabulous central city electorate.

In terms of this place—look, this is an odd place, and I think sometimes you need to reflect on that. To be honest, as you kind of slowly slide into the shadows, you see it in stark relief. It’s got a strange mixture of tradition, procedure, personalities, and institution, but the thing I love most about it is that it’s representative, and that is exactly what it should be. From the four corners of the country, we come here, and we bring a diverse group of voices to the arguments and discussions we have.

To be fair, when you’re a lawyer, you do have to have a certain degree of arrogance, particularly as a litigation lawyer, and so when I arrived here, I did think I was going to do OK. It didn’t take me long to work out that I had to take a big chunk of humble pie and recognise that I was back in school, and I actually want to give a shout-out to my Māori colleagues in particular, who have been really good in both kind of nurturing me and also leveraging a little bit of my skills. I think we’ve worked really good together on some massive issues. I do remember one Waitangi when Kelvin Davis was there, and he kind of did that with his head—you know, that “Get over here, boy” gesture. As I walked over—he’s got this inscrutable face—he looked at me, and he said, “I saw your video on the Treaty principles bill.” I thought, “Oh my God! I’ve done it wrong—big tikanga breach.”, and he just did this wry smile and said, “It was good.” That’s pretty high praise—that’s about as good as it gets from Kelvin.

Sometimes the antics that go on here bring this place into a bit of disrepute, but I think everyone around here understands that it’s actually important that we apply ourselves to good legislating and good government. The rules are strange, the hours are oppressive, and the place is foreboding, and sometimes there’s more performance than policy, but, ultimately, it’s a place of hard work, and it should be, because this is the centrepiece of our democracy.

I just want to mention that the oil that runs this place, of course, are the many staff, and their attitude, their kindness, their friendliness, and their manner makes our job so much easier. It’s exemplified by the day I arrived here. It was all very exciting, and I had my new swipe card. I came back about half past 9 at night and thought, “I’ll have a look around the building to get my bearings.”, and I got hopelessly lost. I was in the depths of the basement, with the buzzer going that I couldn’t go through that door, when I was stopped by a security guard. When I said, “Look, I’m a new MP and I’m having a look around, his face lit up, and he said, “Sweet.”, and I got a one-on-one tour, for an hour and a half, of the entire building. The oldest urinal is in the old library building. It’s the place to go.

We do reflect on this place, and it’s usual to say that things are going to hell in a handbasket. This place isn’t falling apart, but we do need to be vigilant. It’s so precious. I do think we do need to be wary of excessive lobbying, of an excessive use of urgency, and of retrospective legislation, and we need to be constantly vigilant that whoever has the Treasury benches values not just the rules but the principles that underpin our democracy. If we don’t do that, the frustrations will spill out of here on to the streets outside.

I want to acknowledge the media because they have a—thanks for coming. Oh, there is someone up there! They do such an important role, and I think they do it, on the whole, very, very well indeed. They keep us honest. I actually knew my career was on the slide when Luke Malpass did one of his ministerial kind of “How Ministers are doing”, and he said, “and then there’s Duncan Webb—affable and competent”—damned by faint praise! I’ve been questioned by media on all kinds of things—insurance, law, consumer data rights, earthquake recovery, and so on and so on—but the best question ever was about two weeks into my time here when Jenna Lynch said, “Do you still think it’s OK to eat kiwi?” You’d need context for that one.

Some might think it’s surprising that I’m calling it a day, but this is the longest I’ve ever held down one job—it’s not a proper one. But I’ll miss this place a lot, and I’ll miss these people a lot. This is a fantastic group of people. It’s a fantastic Labour caucus. From the outside, it looks unified, focused, and committed. From the inside, it’s pretty much that as well—believe it or not—and, Chris Hipkins, that’s a real credit to your leadership. You’ve done an amazing job. We are here, and it’s going to be a tough election, but this caucus is ready to govern.

I leave optimistic about this place, about Parliament, about Christchurch, and actually about New Zealand. Christchurch Central will be well served by its next candidate, George Hampton. If I could offer him one piece of advice, it would be this: ka tae koe ki te whareumu, tīhorea te kūmara—when you get to the kitchen, peel the kūmara.

This place is full of noise, drama, strategy, process, personalities, and ego, but in the end, the job is actually very simple: find those people that need help, find the fix, do the mahi. Thank you.

[Applause]

Waiata—“Tūtira Mai Ngā Iwi”

19:30

Thank you, Madam Chair. I’d just like to take this opportunity to acknowledge the Ministry for Cities, Environment, Regions and Transport (MCERT), because most of our examination that we did back in June for Vote Environment took place before MCERT was established on 1 July. Obviously, now that ministry is established. We did speak a lot about that during our examinations.

The appropriations sought for Vote Environment in 2026/27 total $2.166 billion, but the bulk of this funding is the responsibility of the Minister of Climate Change, while the Minister for the Environment was responsible for appropriations totalling $376 million. During the appropriations for Vote Environment, we heard about the waste disposal levy, Environmental Investment Fund, tyre stewardship fees, and activity that related to waste minimisation work. During our discussions, the focus also included the transition of the environment functions to MCERT, to the new ministry.

We also spoke heavily around the resource management reform and the appropriations that were directed to Resource Management Act reform—obviously a big job of our Environment Committee. During these discussions, we also spoke about the freshwater farm plans. The Fast-track Approvals Act was also part of what we spoke about and what we heard during this time, and, of course, product stewardship—Tyrewise, as we’ve already spoken about. Other matters considered include the city and regional deals, renewable energy, and upcoming legislation, as well: the Agricultural Compounds and Veterinary Medicines Amendment Bill and the Hazardous Substances and New Organisms Amendment Bill, and, of course, the Waste Minimisation Fund.

I would just like to thank the Environment Committee for the work around Vote Environment and appropriations and Estimates. Thank you.

Before I take a call, I just want to clarify with the Minister: so we have Minister Grigg and Minister Hoggard here at the moment—

And Minister Bishop will join at 8.00 p.m.

OK. Thank you. The Hon Rachel Brooking.

19:33

Thank you, Madam Chair, and thank you for the clarification. I’d like to start with waste tonight. I know that there will be lots of questions about the range of issues, but for anyone who didn’t hear, it was that Minister Bishop is coming around 8 o’clock, and Minister Hoggard is here for the whole thing, as well.

Correct.

And no Minister Watts, I presume? For climate? No—OK. So, waste legislation: we might have some climate questions for you, then, Minister, given that the Estimates report included that and, as the chair of the Environment Committee said, most of the Budget is, in fact, related to the emissions trading scheme.

I can clarify for the member that climate is not currently included.

Thank you. Now, waste legislation. The Minister will be aware, of course, that at the end of last term there was legislation that was ready to be drafted to modernise the Waste Minimisation Act and also the Litter Act. If she could give us an update of where that is at—it mentioned in the select committee report that it was ongoing, so when will that bill be introduced?

And then my next question is that her predecessor and the Ministry for the Environment sort of banned the use of the term “circular economy”. I have heard other members from her party embrace this term “circular economy”—looking at you, Grant McCallum. Does the Minister have a position on “circular economy” and will that be included in the legislation, or does she agree with her predecessor that it’s merely an ideological term?

19:35

Good evening, members. It’s a pleasure to join with you here this evening. As has been noted, I’m joined by Minister Hoggard and Minister Bishop is on his way.

I’m happy to answer questions around the progress of the Waste Minimisation Act amendments. I do intend to reform the Waste Minimisation Act and the Litter Act to ensure that New Zealand has a fit for purpose and modern waste legislation that, I think, does need to provide more flexibility and more options to reduce waste efficiently and effectively. In October last year, the Cabinet approved policy proposals for the waste legislation and for the Parliamentary Counsel Office to commence drafting the bill. Unfortunately, we seem to have run out of runway. I would humbly request that Her Majesty’s loyal Opposition perhaps utilise the time that we have remaining in the House this parliamentary term wisely and perhaps we might get more bills introduced.

Look, you will be aware that public consultation has been carried out and it closed in June 2025. There are a number of proposals that have been consulted on, particularly around creating frameworks for extended producer responsibilities, which is an area of work that I am very keen to lean into when we have the time, because I think it is a very, very good model that will allow New Zealand to very much improve recovery and recycling of materials and products.

There will be changes to how the waste disposal levy is allocated, particularly to territorial authorities and how they might consider spending it. There will be an opportunity to improve and provide more proportionate tools for compliance and monitoring and enforcement. I’ve had a number of members of Parliament from parts of Auckland who are concerned about increases in littering, and they are looking forward to more opportunities for compliance and enforcement.

As to particular vernacular chosen or declined to be used by previous members and Ministers, I can provide no comment on that.

19:37

Thank you. Well, of course, I was asking the Minister what her view on the circular economy is and if that’s a term that she is allowing the part of the ministry that reports to her to use. That’s the question on circular economy.

And then, in response to the answer, will the new legislation contain any waste reduction targets? That’s a specific question.

The Minister mentioned the waste levy and how there will be changes to that, particularly to district councils, to territorial authorities. Will waste minimisation activities be able to be funded by that levy? That is the first question about the levy. The second question is if she can confirm to the House that the general approach—and this goes beyond waste—to funding Vote Environment is to take the waste levy, feed it back into the part of the Ministry of Cities, Environment, Regions and Transport that is the Vote Environment, and then reduce the funding that comes from the centre to go into Vote Environment.

19:38

Thank you, Madam Chair. I want to touch loosely on the very clear distinction that has been made between the last Budget and this Budget, and that is the formation of the Ministry for Cities, Environment, Regions and Transport (MCERT). I wanted to ask the Minister specifically about that, because despite not one Government party campaigning on it and not one credible submission in support, the Government did move to disestablish the Ministry for the Environment and that core dedicated voice for the environment that had been in place for 40 years.

I’m interested because the Minister at the time said that she wanted to assure New Zealanders that this bill signals a new chapter for environmental management in New Zealand. My question specifically about that is: does she mean improved environmental outcomes, and what specific outcomes does she envisage will be strengthened by the disestablishment of the Ministry for the Environment and it being subsumed into this MCERT ministry? Really keen to hear that. Thank you.

19:40

Thank you. Moving on, then, to the Ministry for Cities, Environment, Regions and Transport (MCERT) as well. The select committee report-back noted that: “The Minister told us that she intends to set clear expectations for the incoming Secretary and chief executive, that environmental considerations are to be paramount in policy development, consent considerations, and anything else that MCERT looks at.” Can she give this House an update on whether or not she has in fact acted on that intention and set those clear expectations?

Yeah, I am happy to give a little bit more detail on that. I think I said last time we were here in this House, that with the formation of the Ministry for Cities, Environment, Regions and Transport (MCERT), and thanks to the work of the Environment Committee, there is now a requirement of the Secretary for the Environment to report on the performance of their Environment Act functions every year, and for that to be included in MCERT’s annual report.

Further to that, I do want to reassure the committee that since I informed the committee of that information, the Secretary for the Environment has set about establishing a new role in his office, in the Office of the Chief Executive, that will specifically assist with developing the approach to undertake the Environment Act functions—and, of course, preparing those quarterly reports on the progress as well as the annual report that’s required by the Environment Act. It’s envisaged that the interim role will provide independent—I think that’s a really important point to make: it’s independent advice, independent visibility and assurance to the Secretary regarding their performances under the Environment Act functions across MCERT.

So that’s the whole point of the merger. It’s to stop the siloing that’s been occurring and to make sure those functions are occurring across the new ministry. The future of that role will be considered through the MCERT operating model process, but I’m really looking forward to seeing the impact that it will have.

19:42

Thank you, Madam Chair, and I thank the Minister for that information that she shared. I’ve got a couple of questions around the environmental advice piece within the Ministry for Cities, Environment, Regions and Transport (MCERT). During the Estimates examination for this particular Vote, when we asked for details around that, the response that we were given was that MCERT’s operational practices at the time were yet to be determined. And so I wonder whether the Minister would be able to give us a little bit more insight into that piece within MCERT, whether the operational practices that were previously mentioned have in fact been put in place, and what they look like.

That went back to the point that many of us on this side of the House raised during Estimates examinations around how Ministers responsible would be able to—with the amalgamation and Vote environment moving into this new ministry, how would members have any comfort that environmental advice will remain sufficiently prominent within MCERT, given that the chief executive of MCERT is also the secretary for everything, all of the things, cities, transport, environment and so on and so forth? We were quite concerned that environmental advice, specifically both around the urban environment but also the natural environment, would be subsumed within this larger ministry. So really keen to get a sense from the Minister around what those practices are that have been put in place to ensure that that advice retains its prominence.

I’ve got a couple of other questions related to the Parliamentary Commissioner for the Environment’s recent report around environmental information, and a particular Budget line within Budget ‘26 as well. But I’ll see if the Minister would like to answer this bit first.

19:44

her I thank the member for her question. Look, I’m aware of the concern that was raised, particularly during that select committee process, and indeed by members of the Opposition, that the disestablishment bill would somehow subsume, to use the member’s words, the environment functions or that they’d be deprioritised as they became a part of a larger ministry. But again, and I have said this a number of times, those amendments simply transferred the Ministry for the Environment’s existing functions to the Secretary for the Environment, and they will—and I expect that they will—continue to be performed appropriately by that new ministry. Again, to be clear, and I’ve said this a number of times, the previous statutory functions under the other Acts do continue to be performed. And, you know, it is my expectation that the environmental capability does remain a core capability within the new agency. That includes, of course—and I’m sure Minister Bishop talked to it—the implementation of the resource management reforms.

I have to say, you know, I think I’ve had the portfolio for nearly five months now, but the more I get to know the officials within the Ministry for Cities, Environment, Regions and Transport, who were once the officials of the Ministry for the Environment—I would call them world class. I think we’re very, very lucky to be to be supported by such high-calibre experts.

19:46

Thank you, Madam Chair. I take the Minister’s point that the intentions and expectations that Ministers hold is for the environment not to be deprioritised, and that is good. I also have absolutely no objection to what the Minister said about the quality and calibre of officials in our Public Service. However, I would like some comfort from the Minister in terms of how those intentions will be realised. Because while it’s one thing to say that it’s a lift and shift off Vote Environment and the priorities of the Ministry for the Environment into a much larger ministry, having been previously a Minister who held portfolios that were serviced by a larger ministry, I do have some experience as to how it could be subsumed or deprioritised.

While the intention is not that, I would like some comfort from the Minister in terms of what practices have been put in place to ensure that there is the same quality of advice, that there’s timeliness around the environmental advice that is provided or received from the ministry. How many staff, for example, have transferred over from the former Ministry for the Environment into the Ministry for Cities, Environment, Regions and Transport? Who will specifically provide the Government with advice around both the built and natural environments? And if it is continues to be a priority for the Minister that there is independent advice around both aspects of the environment, what particularly has been put in place to ensure that that is actually delivered?

19:47

Thank you, Madam Chair. I just want to again reassure the House that we are very much committed to ensuring that the Ministry for Cities, Environment, Regions and Transport (MCERT) continues to prioritise the environment. I’ve already outlined that the Secretary for the Environment has already established a new interim role in his office to help with developing the approach that will undertake all of the environment functions and to make sure that they remain front and centre of this new ministry. And again, in establishing MCERT the Government is neither removing nor diluting the environmental responsibilities. They’ve transferred, unchanged, into that statutory role of the Secretary for the Environment—who does remain directly accountable to the Minister of the day, which happens to be me at the moment.

To answer your questions around staffing, I can tell you that 621 permanent full-time equivalent (FTE) have transferred from the Ministry for the Environment to MCERT as of 1 July 2026, and 125 fixed-term FTE transferred.

Lan Pham. And I’ll just make a note that Minister Bishop is now here, too, and also available for questions. So we have all three Ministers.

19:49

Thank you. What a treat, Madam Chair, thank you. I wanted to pick up on freshwater, and particularly—I’ve just come from a lecture by Dr Tim Chambers, who spelt out really clearly that we’ve had a massive increase, particularly, in dairy herd numbers across the country. It’s gone from 100,000 cows in 1990 to 1 million just in Canterbury alone. Over that time, we’ve had a threefold increase in nitrogen fertiliser application.

As a result, there are numerous studies and research and even the Minister’s own data which shows nitrate pollution in many of the country’s drinking water sources, but particularly around Canterbury and Southland are now breaching drinking water standards. Communities are having to pick up the costs. For example, there have been numerous schools currently in Ashburton who cannot drink the water and are having to dig deeper bores to search for water that is less polluted than they currently have. We have Selwyn and Christchurch both facing bills in the hundreds of millions to treat their drinking water for increasing nitrates, and the Government has put in place, unfortunately, rules that are going to exacerbate this issue.

I’m really interested in the Minister’s response, particularly when it comes to the environmental health aspects of nitrate pollution. How is her Government addressing this and what does she expect the environmental implications will be over the next few years, particularly as the new planning regime is put in place that this Government is so set on putting in place?

19:51

Thank you, Madam Chair. I thank the member for her question. I don’t want to get into a debate over data and her sources versus my sources, but the information that I have been given today from the Ministry for Cities, Environment, Regions and Transport is that cattle numbers are actually declining in Canterbury. At so-called peak cow, 2023, there were 1.36 million cattle, and I’m rounding here. As of late last year, it was 1.33 million, so, again, we can—

So worse than what I was saying.

Well, it has declined. Look, we can debate those numbers until the cows come home—bada boom. Look, equally, what I would say is there are conflicting reports across Canterbury and, yes, there absolutely are areas that are reporting nitrogen increases and they have to be dealt to. I’m sure the Minister Hoggard will be able to talk to that effusively at some point, but, again, there are a lot of variances.

I can talk specifically to Canterbury as a Canterbury-based MP. I suspect that the data you might be referring to has come from the regional council. If you look to some of the actual irrigation providers, which have, in my view, far, far more robust measuring capacity—different depths, different sequencing, more frequent intervals. I think every 15 seconds was the last count I got given. If you look to Central Plains Water who irrigate 45,000 hectares, they’re actually showing that 60 percent of their dedicated groundwater monitoring bores are seeing a reduction in nitrates, and that trend has been very evident over the past five years of the data I’ve got. Again, it’s not perfect, but there is a material improvement being shown.

Look, interestingly, they have actually also, as a scheme, reduced groundwater use by 75 million cubic metres, which is actually equivalent to 22,000 Olympic swimming pools, for those who were interested. But, look, we all accept that agriculture does have an impact, but we note that the most significant reductions across the Canterbury plains have been made on-farm and I think collectively we need to start to look to the urban environments and the pollution that they are causing.

19:53

Thank you, Madam Chair. Just for the Minister, is she aware of some of the research and the progress the farmers are making in Canterbury, with research into aquifer recharge and the use of plantain and the research that has come out of that which shows that a 17 percent increase in the pasture content of plantain can lead to a 33 percent reduction in nitrate levels? Would she care to comment on that and other work farmers are doing?

19:54

Oh, I thank the member for that question. Look, I think—and, well, I might as well sit down if Grant McCallum made the best contribution of the night. Look, again, there are real gains being made. I note that of their own volition, I think farmers have fenced off some 25,000 kilometres of waterways around the country. Stock exclusion rules are in place and winter grazing rules are in place. I’ll invite Minister Hoggard to get up and talk about the freshwater farm plan announcement that he made today, but certainly I think we all should collectively accept, as a Parliament, there are parts of the freshwater system across this country which have been degraded and I think collectively we have to work towards improving them. I think with the new planning regime, that lightens up on the low-intensity areas but comes down a bit more heavily on the high-intensity areas. I think there will be gains to be made out of that. Minister Hoggard.

19:55

Thank you, Minister, for that. I totally agree. I think I’ve said it before, but when I started dairy farming in 1998, the attitude of farmers was way different than what it is today. Back then it was “No, we’re not part of the problem. We’re not causing anything. Go away. Leave us alone.” Now the attitude is far different. You’ve got catchment groups up and down the country. You’ve got people looking at what options they can do.

Just touching on the farm plans, I did a trial run on my farm and it was very informative in terms of being able to highlight the parts of your farm—what the soil types are, what the risk factors are, what the challenges are that can be caused to the environment, and coming up with solutions in terms of how you mitigate that. The farmers being engaged in the space and coming up with tools that work alongside them will help that.

As the member Grant McCullum mentioned, great news on the plantain. We’re seeing more and more of that being planted around the country, and I’ve mentioned bioreactors and engineered wetlands before. Part of the new system is we’re going to make them a permitted activity to put in an engineered wetland. I was blown away over some of the visits I’ve done with community groups who had built engineered wetlands to do all this great work to remove contaminants. They had to spend upwards of $100,000 on consents to be able to build this. It was improving the environment.

We’re moving in the right direction in terms of coming up with these solutions. The farmers are in the right mindset to do this. We need to move out of the blame game and work towards how we’re going to improve all of this. We know what caused it and we’ve just got to work towards coming up with solutions.

19:57

Thank you, Madam Chair. Just reminding the Minister of my questions about her view on the circular economy, whether waste minimisation activities will be able to be funded by the remaining waste levy, whether the legislation has waste reduction targets, and if my potted history of how funding for Vote Environment happens via the waste levy is correct.

Moving to the freshwater farm plans that we seem to have moved on to, a small question: the Minister cited a number there about cattle. I guess the question is how does that reflect dairy?

Then for Minister Hoggard, I note in our Environment Committee report we talked about the gaps where catchment groups are not set up or where one member of a community is not a member. In those areas, the Minister said it is important that challenges are still identified and addressed. I’m interested in the addressing of those challenges that the Minister intends to do, but in particular, I’m interested in the relationship to proposed local government change and the getting rid of regional councils that are largely based at a catchment level. What are the plans for keeping that catchment approach?

Then a question for the Minister for the Environment: is she advocating for catchments and catchments as an important unit for any resource management?

All of the above.

19:58

I’ll try and deal with the farm plan question. I believe what I was talking about in the previous situation was where not everyone in a catchment might be a member of a catchment care group. That’s why it was important for every individual farm to have a farm plan, so that even if they weren’t being part of the group effort, they were still recognising the challenge on their farm and taking actions to improve it.

19:59

Thank you very much, Madam Chair. Tēnā koe to the committee. In relation to local government reform, I think the point the member makes in relation to catchments is an important one and is certainly something we are thinking about when it comes to the next steps on the Head Start pathway and broader local government reforms. That was one of the criteria that was listed in the Head Start document that people have been cogitating over over the last few weeks and months and—

Panicking over.

What’s that?

Panicking.

I don’t know about panicking. I mean, what’s interesting is there’s quite a bit of desire from some councils to crack on with it—that’s why Head Start was started: people said, “Rather than you guys run through some long-winded process, we’re keen on cracking on with it,” and we said, “OK, well, come and give us your best shot.” We haven’t made decisions on it yet, and once we’re in a position to do that, we will make announcements in due course.

20:00

Thank you, Madam Chair. Other than a sunny attitude of farmers, I wasn’t hearing anything that would practically address the very real issues that I just outlined, which I won’t repeat. What I am really interested in is asking about the cost to New Zealanders of the fact that numerous plans, particularly that pertain to fresh water, will not be able to be implemented, even though there’s been millions of dollars put into them.

I particularly want to touch on two instances of this. It was reported just recently that after the numerous horrific cyclones up in Gisborne, Tairāwhiti, and unfortunate tragedies that occurred in the aftermath, Gisborne District Council came up with a plan that would actually urgently tackle those forestry issues and the destructive land use that is currently going on across Tairāwhiti. This was through a regional plan change, Plan Change 7, that was proposed to protect erosion-prone land—but this plan change couldn’t go ahead because of this Government’s plan-stop legislation, and they asked for an exemption and they didn’t get it.

Now, the same is happening when it comes to the Waikato, when it comes to Otago, and when it comes to Canterbury. Regions are ready and in place to put in rules and frameworks that will actually help their environment and help their communities. What I’m really interested to know is who does the Government expect will pay the costs of these issues remaining unaddressed for the years that are to come when it comes to health costs, when it comes to a lack of recreational opportunities, the costs of ecosystems passing tipping points, or impacts on our international clean, green image? This is even extending to the cost of illness from polluted drinking water. These are serious costs that are being borne by community, and I’d really like to hear what the Government is proposing to do in this space.

20:03

I’d just proffer a small comment, Madam Chair. The plan-stop process is not perfect—I don’t think anyone pretends that it is—but it’s a pragmatic attempt to deal with the transition problem we’ve got, right. The law is the law until it isn’t, OK. The Resource Management Act (RMA) provides that people do regular plan changes and councils update their plans all the time. Sometimes they’re small, sometimes they’re large. At a certain level, we just decided—and Parliament, in fact, agreed through the RMA consenting and other matters bill last year—that there had to be a point at which you say, “Well, hang on—tie-ho—and we’ve got to get ready for the new system.” There obviously had to be exemptions for that, and so there’s been a range of pathways—

We didn’t agree.

What’s that?

Opposition parties didn’t agree. You say Parliament sought it, but that’s because you’ve got a majority.

Well, that is actually the way Parliament works. When Parliament agrees to something—

The way you’re saying it is making it sound as if we were all in agreement, and we weren’t.

Parliament agreeing to something is, by definition—it can either be by majority or by unanimity. That does mean Parliament agrees. That is the reality. That is the way our parliamentary democracy works.

Anyway, I have the power as the Minister responsible for RMA Reform to grant exemptions. Some have been granted—in fact, many exemptions have been granted. Others have not. Speaking generally, the more complicated the plan change, the less likely it is to happen now, because we didn’t want to find ourselves in a situation where a three- to five-year long plan change process is under way—because sometimes they can take a long time—that was happening simultaneously as everyone was gearing up for transition to the new system.

That’s not to say that the impetus for the plan changes is not important. Many of the issues the member is raising are important. It’s not that. It’s that, at some level, they have to happen in a different system, otherwise you end up with this endless duplication and churn and endless cost. And so, that’s where the position is. I accept it’s not perfect, but environmental law often isn’t.

20:05

To that Minister: do the complex plans that he’s talking to happen to relate to water quality?

Well, it depends. There’s been heaps of different plan changes—they’re all on the Ministry for the Environment website; the member can look for herself, and the member can see the law has the various different exemption pathways through, as well. So the short answer is that it depends. They’re across a whole range of different things. Some issues are to do with water; many others are not.

20:06

Reminding the Minister for the Environment about my waste questions; and, also, the cattle versus dairy; and if she has been advocating for catchments.

Going to Minister Hoggard: we were at the Environment Committee talking about the nitrogen cap and the low compliance with it. My question is whether there’s any further movement on—if he has an update on his approach towards a nitrogen cap and if there has been any additional work on compliance.

In terms of additional work, no, there hasn’t. Obviously, there will be a new system we will have—and it’ll be in the next term of Government—that determines what the national standards on all of this are. So that won’t be happening anytime in the next five weeks. In terms of compliance work, I don’t believe that fits under my delegation, so I haven’t heard anything on that. One of the other Ministers may have.

20:07

Thank you, Madam Chair. Just to confirm to the member Rachel Brooking, they were dairy cattle numbers that I was referring to. Yes, I advocate on behalf of catchment groups. I meet with them regularly. I also approved a transfer of some funds from the former Ministry for the Environment to the Ministry for Primary Industries to go in towards supporting catchment groups.

Regarding the question on waste levy, yes, money is available for waste minimisation as well as wider environmental benefits. That’s why the rules were changed a year or so ago.

Regarding targets, there are not targets in the legislation.

20:08

Thank you, Madam Chair. I’m going to move to resource management reform, and I want to again ask the Minister what she is doing in terms of advocacy for the environment with that. I’d like to start with asking her if she’s thought about advocating for future generations within that legislation. That may be because I have just been with the chair at a group talking about future generations, but, of course, the Resource Management Act does refer to future generations and all of those ideas have very much come out of the legislation, which is soon to have its committee stage.

When I was asking the Minister about catchments and advocacy for catchments, it was not just catchment groups; it is the idea of using a catchment as a tool for environmental planning, and particularly around water.

I’d also like her to comment further on a remark she just made in this House about how the resource management reforms are “lighter in some areas but harder in other areas,” or words to that effect, and if she can give some examples of where the new resource management legislation is going to be “harder”.

20:09

To clarify, I was talking about freshwater farm plans, and it’s been made very clear in the press release just this evening that there will be a lighter touch for low-intensity activity and more rigorous auditing for high-intensity activity.

Just responding to the query around thinking about future generations—well, I would submit to this Parliament that that’s been the driver behind the entire Government work programme this term. I speak specifically to replacing the Resource Management Act (RMA). That has been with the purpose to unlock economic growth, improve environmental outcomes for the benefit of all. We will have a new system passed into law before this Parliament rises, God willing. The likes of, if I can speak specifically to the Natural Environment Bill, that will very much provide a framework for protecting and enhancing the natural environment through limits.

I know that the Minister responsible for RMA Reform can talk very succinctly about the next phase of work regarding national direction and how those limits will be designed and where they’ll sit, but there will absolutely be clear limits for the environment to support better land and water management.

20:10

The Minister for the Environment makes a very important point, which is one of the many failures of the Resource Management Act (RMA): the failure to set limits. Everyone’s in favour of development within limits. The RMA has not allowed for that.

What about the Natural and Built Environment Act?

What’s that?

What about the Natural and Built Environment Act and Spatial Planning Act? They set limits.

What about them? They’re not part of the law any more. We got rid of them three years ago because they were disastrous pieces of legislation.

I’ve been rereading them—so much better.

Well, you’ve got to get over it, because it was three years ago, Rachel. No disrespect. But Parliament—

I just want to remind, the question is these Estimates, not historical.

Parliament dealt with those issues, and we’ve worked a damn sight harder to try and get you guys on board than you tried with us, but anyway.

Nonsense.

Well, do you want to know what actually happened? David Parker called me into his office the night before the Natural and Built Environment Act was introduced and said, “Here it is.”, and expected me to read 1,000 pages overnight. So that has not happened in relation to the backwards and forwards between the Government and the Opposition in relation to RMA reform. We have not been able to reach agreement, but it’s not—

That is not what happened in the select committee.

Well, it is what happened. I was there. You were never—oh, sorry, you were part of his little hand-picked advisory group writing the legislation in the first place. I forgot about that. I was going to say that you weren’t an MP, but you eventually became one. Anyway, I slightly digress. In fact, I wildly digress. One of the main benefits of the new system will be the setting of clear environmental limits across fresh water and across other environmental domains; we intend to do that. National direction will be part of that, which we will soon publish an illustrative draft of.

I think members will appreciate seeing a bit more flesh on the bones as to how the system will work in confronting some of these trade-offs, because environmental management is at some level about confronting trade-offs. You can’t do everything, you can’t have it all, and you’ve got to weigh up the costs and the benefits of things. Again, costs and benefits will be one of the key functions and features of the new system, because one of the things that I’ve learnt—I’ve learnt many things in the last three years, but one of the things that’s really been highlighted to me in Government is the concept of trade-offs. You can’t do everything. You have to prioritise and make choices. Part of good decision-making is confronting those trade-offs early, and that’s what we’re attempting to do through the new planning system and environmental system, and creating a simpler process down the other end of the funnel from a consenting and permitting point of view, which is in everybody’s interests and everybody actually agrees on that. So that’s all I have to say, really.

20:13

Now, this question is to the Minister for the Environment, and the Minister just spoke about limits before referring to the other Minister. Is she aware of clause 79 of the Natural Environment Bill, as reported back, that enables the Minister—a different Minister—to sidestep limits with very few criteria to constrain that decision? That’s one of my questions.

Another one is: has she, as Minister, advocated for the inclusion for provisions that would improve the environment, such as green spaces, to be provided in that legislation? I’ll leave those questions there, and then I’m happy to move to the fast-track legislation. No? No answer?

OK. Keep going.

Great. Thank you, then. We will move to fast-track legislation. We’ve heard on Morning Report from Minister Bishop that fast-track has been designed to enable out-of-sequence housing developments and he’s not apologetic for that in the slightest. Has he been listening to his members of Parliament that come from Queenstown, that come from Selwyn, that come from where Mr Penk hails from, and all around the country, where they are making the point that they’ve made the whole time that this version of the fast-track has been a thing, that those councils already have planned areas for infrastructure for 30 years of housing growth, and yet this Government is just letting other developers totally ignore that, go over the top, and cost ratepayers a whole lot of money?

20:16

Well, there are a few things that are not accurate there. The first thing is Queenstown does not have 30 years of feasible housing capacity. In fact—

That’s what the mayor said.

Well, ha, ha! They wrote to me a few months ago telling me that, because the National Policy Statement on Urban Development that the last Government promulgated that we support was required by law to write to me when they don’t meet their development capacity obligations. The mayor and the council chief executive had to write me a letter saying that they admit that they have not done proper spatial planning, they have not planned for enough growth, and all the rest of it. So they might be claiming now they don’t, but I’ve got it in writing, and the member can Official Information Act it and she can see for herself.

It’s not entirely their own fault. The planning system has been difficult to do proper spatial planning, which is why we’re changing it. Unlocking land for housing has proven a burdensome and difficult problem, which is why we’re changing the law to make that easier. Fast-track is a way around that. The member assumes that all growth that is in sequence or phased and planned growth is good, and anything that’s out of sequence is bad but that’s not necessarily the case. The whole problem with our planning system is that we sequence it and we plan it and we draw a ring around a city and say, “You can build here but you can’t build here.”

That anti-development approach is precisely why we have overinflated land markets with high prices for the land that you can build on, which flows through to housing prices. Now, there’s extensive economic work around this. That’s why the new planning system, as we announced today, will contain a goal around abundant opportunities for development and competitive urban land markets, and create a statutory obligation on councils to create competitive land markets, so that when people want to build and they can fund the infrastructure and recover the infrastructure costs of that infrastructure and deal with the environmental effects of that infrastructure, they can build it. That is the system we are building. It’s not there yet, I accept that, but we’re going to get there.

In relation to the member’s points around infrastructure, I accept her point, and that’s why we are advancing an amendment to the Local Government Act via the Local Government (System Improvements) Amendment Bill in order to allow councils to retroactively—or at least in response to green fields fast-track projects—change their development contribution policies so that they can recover the growth costs because the issue, which I accept is an issue, is that the direct costs are locked in once an application is made, but, of course, the direct costs for out-of-sequence growth are deliberately low because no one anticipates the growth there. That’s fair enough; you end up with under-recovery of the growth costs, and that’s why the Government is changing the system around development levies, which we are a couple of years away from legislating, but we’ll get there eventually. We’ve done a whole lot of policy work around that. The changes to the Local Government Act are a sort of interim fix in the interregnum period between now and development levies. I think that will be—well, I know for a fact it’s been widely welcomed by councils and mayors and will allow for the recovery of network growth costs.

It is worth noting that people need to read the fine print on some of these fast-track conditions, because people just assume, “Oh, it’s been fast-tracked, therefore I can just go and build.” They can’t. You need to read the conditions. The conditions are often extremely extensive around highway upgrades, around waste water, around stormwater, around local roading upgrades. One of the ones that people are worked up about involves endless amounts of time and money being spent on wetland restoration, for example; before the project can happen, or at least to the extent the project sponsors want it to happen, it requires a whole range of ancillary infrastructure upgrades, so it depends on project by project. The point is that the panels are imposing quite extensive infrastructure conditions on projects. I think the sort of misunderstanding that “Oh well, it’s just been fast tracked; you can go and build.” is not actually the reality. Unless you can actually build and deal with the infrastructure conditions, you can’t. That’s part and parcel of the fast-track process.

20:20

There are a lot of “depends” in that answer. Does the Minister responsible for RMA Reform accept that there are areas with fully planned growth for over 30 years where fast-track applications can jump into separate areas?

Yes, but I see that as a feature, not a fault of the system.

Will the development contribution problem, the foreseeable problem that he just explained, apply to fast-track approvals that have already been approved or are in the system?

No, we’re just working through the fine print of that now, but we’ve made decisions and announced most of it. So anything that’s been approved now—no, it won’t, because I hope the member would agree it would be pretty contrary to good legal practice to retrospectively impose different draft conditions on approved projects. That would be bad, so we’re not doing it for those. It will apply to referral projects. The question is over the substantive applications, and so we’re just working our way through the fine detail of that right now. But anything that’s been approved—no, it won’t. Anything that is in the process of going towards the substantive application—the answer is yes, and we’re just working our way through that, and you’ll be able to see the Amendment Paper when it’s tabled in a couple of weeks, I think.

20:21

So it will be rate payers that are picking up the bill that would have otherwise been paid by development contributions for those fast-track approvals that are on land zoned for not being housing.

20:22

The short answer is that it depends. It depends on the project, and it depends on the conditions granted in relation to that project.

Now, moving to back to Minister Hoggard—and this is about farm environment plans. In a prior hearing, he mentioned that the industry did not want to audit their own farm environment plans, so the question is: why has the Government moved to allow the self-certification and self-auditing of those plans?

You’ll find that most industry assurance schemes—for example, the one I’m involved in, the Fonterra Tiaki plan, uses third-party auditors. In effect, all of them already use third-party auditors. Fonterra may provide a certified farm plan for myself and Grant McCallum, but it does not audit them.

20:23

I’d remind the Minister for the Environment of my many unanswered questions, and I’ll give her another one, and that is about the Agricultural Compounds and Veterinary Medicines Amendment Bill and the Hazardous Substances and New Organisms Amendment Bill. Why were they sent to the Primary Production Committee and not the Environment Committee?

Well, I’ll cover one of those. It’s quite simply because the main challenge that we were trying to address with both of those bills is the fact that it was slowing down the ability to get in new agricultural chemicals, compounds, and sprays. That was the challenge we were trying to fix, so it felt most sensible that it was the Primary Production Committee that was the one that received those bills and worked through the answers.

20:24

Just further to that, as I understand it, it was also because the Environment Committee had an extraordinary heavy workload at the time with taking submissions on the resource management bills.

The Hon Priyanca Radhakrishnan—I’ll just remind the committee that we have about 5½ minutes left on this topic.

OK, I will be very quick. Thank you, Madam Chair. My question is for the environment Minister, and it’s around the environmental information system. Now, there’s been a recent report by the Parliamentary Commissioner for the Environment (PCE) that shows that the information that we have is fragmented, there’s under-investment, and there’s a lack in system-wide leadership. I know that there’s $13 million, from memory, in Budget 2026 around environmental information but that it’s largely around policy and monitoring. I’m keen to get a sense from the Minister as to what that budgetary allocation is for and whether it’ll go some way towards addressing the issues that the PCE has raised.

20:25

Thank you, Madam Chair. My question is to Minister Bishop. Across Canterbury, I’ve had a lot of conversations around flood management, and many residents are asking the question: “If we’re building more houses, are we also increasing exposure to those natural hazard risks?” In fact, Waikuku residents have also sent me a petition regarding the concern about upstream developments and how that might affect our stormwater management and the cumulative effects of that, particularly around the proposed Gressons Road development. I believe there’s a letter in your inbox about that and that petition. Also I just want to actually say the voice of reason around the Pegasus golf course development, declining that fast-track application—that’s fantastic, the voice of reason, and the sustained pressure by the community, so I just want to shout out to the Pegasus Residents’ Group. But back to the crux of my question, Minister, for the benefit of Waikuku residents, any views that you could provide on greater transparency regarding flood modelling and technical assessments would be much appreciated. Thank you.

20:26

I thank the member for his question. I don’t want to get into specific projects, because that way lies danger as a decision maker on it, or as the decision maker on some projects. What I will say in relation to natural hazard risk and flood modelling is that those are clearly environmental effects and things that need to be considered through assessment of projects and are rightly matters—as they are in the Resource Management Act (RMA)—for expert panels under fast track and as they are through council consenting applications.

Speaking again at a general level, the Government’s working pretty hard to do better with natural hazards. For example, we are developing a national flood map. Version one of that is not going to be perfect. In fact, it will be substandard in my view. But for the first time, we will have a national federated data-system of where the flood risks are in the country and the extent of them. It baffles me, for example, that we have all this data between the insurance companies, the Crown research institutes, and councils. It’s all disaggregated in different places, so we’re going to bring it all together into one place. Over time—and again, the RMA reforms are an important part of this—over time, we’ll be able to bring together a second version, a much more sophisticated and comprehensive version of the flood map, which will factor into planning decisions made in the new system. So spatial planning, and land use planning, and environmental management plans. And it will factor into where and what you can build, for example.

It is not correct that just because something is a flood risk, that you can’t build. I mean, there are flood risks all over this country. The key is the severity of the risk and the possible mitigations against that. That is context specific, right? That is fact specific. Some areas should just be no-go areas, you shouldn’t build here, it’s too dangerous. Probably, in the past, we’ve been far too liberal at allowing building in places where we shouldn’t be.

Hear, hear!

In fact, there are many people in Auckland who would say that.

Yes, Christchurch

Exactly, there’s many places. But there are also places where with a bit of targeted investment you can, and we should be upfront and open about that. The key is data—can I just stress that? It’s impossible to make good decisions in this space, for councils or developers or landowners themselves or homeowners. It’s impossible to make good decisions without having good data, and the problem we’ve lacked is the data. Because we haven’t had the data, we haven’t been able to make good evidence-based policy. We’re changing that, I fully accept we’re not there yet. I would hope that the Opposition, and all political parties, could come on the journey, because, frankly, successive Governments have kicked it into the too-hard basket. We’ve made a good start, but there’s a long way to go.

Madam Chair?

We’ve actually got about 20 seconds left, and Minister Grigg has indicated she wants to take a call.

20:29

Thank you, Madam Chair. It was just to answer the question from Priyanca Radhakrishnan, but Chris Bishop did answer it very fulsomely. But just to your point about the reports made by the PCE. Yes, we accept that there is much more to do, but, for the first time, a Government is actually responding to his urgency regarding the need to fund and capture data, which Chris Bishop has just been talking to.

20:30

Madam Chair, I seek leave of the committee for a short time more to ask just one question.

OK.

He did say, “OK.”

I’m told you don’t need to seek leave. If everyone’s happy, you can ask a question.

The question is directed to the Minister responsible for RMA Reform, in relation to his flood map work, which I agree is important and needs to be done. There’s a very real risk that, when those first flood maps come out, there will be a significant impact on people’s property values. I just want to understand—because people will be alarmed by it without sufficient planning under way. I was just wondering what thinking you’ve done around that.

The short answer is that I don’t think that will be the case—although I could always be wrong—because the first flood map brings together data that’s already there. It’s already available in public; it’s just bringing it into one place. Version No. 2, I accept, we should do some thinking about as a country and as a polity, but version No. 1 is pre-existing information.

The next step after that is the National Policy Statement for Natural Hazards, which the last Government did some work on and which we picked up and have done in the last two years. That is about to flow through into the national policy direction in the new planning system. Putting it succinctly, the National Policy Statement for Natural Hazards says that councils have to take a risk-based, proportionate approach to land-use plans in light of natural hazard risk.

Having got the data into one place, we can then make good evidence-based decisions, but it sort of goes to the point that I’ve made a couple of times, which is that we’re not there yet; there’s a long way to go on this. I think version No. 1 will be OK—although I stand to be corrected. Version No. 2 is when things are going to get crunchy, and we’re going to have to have some tough conversations as a country about that.

Members, this Minister’s time in the chair has come to an end, and we now have the Minister of Transport. The Minister is available to speak to that portfolio from 8.30 p.m. until 9.30 p.m. I’ll give the first call to Andy Foster, the chairperson of the Transport and Infrastructure Committee.

20:32

Shall I wait until the Minister in the chair has switched over?

Yeah, yeah—come on.

We won’t be long. We really do technically need to have a Minister in the chair.

Thank you, Madam Chair. I’m pleased to speak on behalf of the Transport and Infrastructure Committee and also on behalf of New Zealand First. We had really good sessions with the relevant Ministers—the Minister of Transport, the Associate Minister of Transport, and the Minister for Rail—and also with agencies. I can see the Ministry of Transport and the New Zealand Transport Agency (NZTA) have joined us. Also, on the ferries issue, with Ferry Holdings and KiwiRail—it was a lot of really, really good information that we got and some good, really meaty issues that we pursued. One of the things that becomes patently obvious, not just in transport but across the country, is that we don’t have enough money for everything we want to do. Therefore, we’ve got to cut our cloth to meet the resources which are available and use what we have got as best we possibly can.

One of the things that we did traverse in quite some length was the issue of asset management. It’s about looking after the assets we’ve got, something that has been stressed to us time and time again as we’ve met particularly with the Infrastructure Commission. I’m delighted that the conversation we had with the Minister in the chair when he was in front of us, as a select committee, was the idea of legislating for good asset management, so that we’re actually looking after the assets we’ve got and we’re not letting them depreciate. That’s not just transport, it’s not just water; it’s hospitals, it’s schools—it’s right across the board that we need to look after those assets better. The direction to suggest that we are going to be looking to legislate next year to require that of organisations is a really good one. I think it will be a game changer.

One of the things that did challenge that, and we did have a conversation about this with the Minister, was the place of the Government policy statement. The Government policy statement on transport has been, essentially, a diktat of the Minister over time—if the Minister says, “I’m going to allocate this much to this pot, and this much to this pot, and this much to this pot.” It is how that links with asset management. If the Minister says, “I want to go and build a whole lot of new roads”—or a whole lot of new railways, or whatever it might be—and there’s not enough money left to look after the assets that are there, that would seem to conflict directly with that. That was an issue I’d certainly like the Minister to respond to.

We had a bit of a discussion around the roads of national significance and how they were fundable. It has been very clear to the select committee for some time that we can’t fund all of those roads of national significance in a short period of time. They might be drawn out over a much longer period of time. It’s a question, then, of how those get prioritised. Again, it would be good for the committee, I think, if the Minister was to talk through a little bit about how that might be advanced. I note that the roads of national significance which are on the table at the moment do not include a second harbour crossing in Auckland. Again, how that gets funded will be of a great deal of interest, I’m sure, both to the public and to the House.

We had a really fascinating discussion talking about the Auckland Harbour Bridge, a really fascinating discussion about the maintenance of that bridge. I can see the chief executive smiling at that. It was really, really interesting—

Don’t bring the officials into the debate.

Oh, it was only said—

I know you’re being nice, but please don’t bring the officials into the debate.

It was a really, really interesting conversation that we had around that.

On the maintenance side, we really stressed, also, that it’s not just the maintenance of State highways. NZTA is the part-funder—at least 50 percent funder—of every local road in the country, and sometimes more than 50 percent. The funding assistance rates are sometimes as high as 70—or, in emergency situations, even higher than that. What we were stressing as a select committee—and again, I’d appreciate the Minister’s feedback on this—is the importance of maintaining not only the State’s assets but also the assets owned by local government, which are partly funded by the State through the petrol taxes. Of course, those petrol taxes and road user charges are derived from people who drive on State highways and on local roads equally, which is why they’re funded in the way that they are.

We noted that there is a significant bow wave of ageing bridges, and it’s been really interesting. I commend the South Island for its approach now. They’ve been very, very vocal about this. They’ve said, “Hey, here is how we can grow our economy.”—they’re doing better than the North anyway—“That’s really important.” I see the Minister for the Mainland is backing me up on that. One of the things they have stressed is the importance of maintaining the assets they’ve got, and that includes the bow wave of bridges and also the ability to be able to maintain seal, etc., roads. Again, some feedback on that will be really appreciated.

If I might, just looking at the time that’s available, just to finish off, we also spent a bit of time on the ferries front and noted the excellent progress that was being made with the replacement ferries, at a much lower cost than was the case under iReX. We also noted that rail is gaining market share. The Minister said that the rail freight market share is up 7 percent, compared to 2 percent for road. We also had some interesting and very useful discussions around potential new rail lines—obviously, the one to Marsden Point being talked about, but also through Auckland, the Fourth Main, and Avondale to Southdown.

There were a lot of really meaty issues that the committee covered. I’d really appreciate the Minister’s feedback on some of those issues which I’ve raised. Thank you, Madam Chair.

20:38

Thank you, Madam Chair, and I want to acknowledge the Minister of Transport for his engagement through the Estimates process and also the chair, Andy Foster, who has just resumed his seat, for outlining the work of the Transport and Infrastructure Committee. I have a few questions. When we look at the Estimates as a whole, you can see some pretty clear things, so my questions are going to centre on, essentially: where’s the money, where’s the plan, and who’s ultimately going to pay? I know I have some colleagues who will want to ask some other questions about specific transport projects in their areas. Then I have some other questions, not quite on that theme, to finish off with. So I will make my start.

I want to start with the fundamental question of how the Government intends to pay for its transport programme. The chair of the Transport and Infrastructure Committee has touched on a couple of the impending issues that are before us, not just as a Parliament or as a select committee but as a country. The Estimates identify that the National Land Transport Fund is, essentially, a Budget risk because it doesn’t have sufficient funding beyond 2027-28 to cover what are its ongoing activities and debt. This year alone, the National Land Transport Programme relies on almost $2.3 billion worth of borrowing. At the same time, the Government has become much more reliant on direct Crown funding, and I want to ask a couple of questions about that.

The Minister himself has acknowledged that the Crown funding has gone from about 3 percent of the programme in 2018-21 to 39 percent in the current programme. Now, of course, there is some further uncertainty around the revenue that was meant to come from motorists—or “people”, as we also call them.

The Government’s policy has been for petrol excise to rise 22 cents over the next three years, but the Minister of Transport has essentially said on a couple of occasions that the increase to the fuel tax looks like a “non-starter”, I think was the quote. But, of course, we’ve also had the Prime Minister describe it as cancelled, frozen, and delayed. Regardless, there’s some uncertainty, and there’s certainly no clarity around that. We don’t know if the Government is going to increase the petrol tax by 22 cents per litre, but what we do know is that the Government has a transport fund that it acknowledges is underfunded. It’s borrowing billions of dollars to sustain it, and one of the planned sources of additional revenue is now in doubt.

But what’s missing from this Estimates is the explanation of how that gap is going to be filled. So my question to the Minister is: can the Minister, as a starter for 10, tell the committee what the size is of that projected National Land Transport Fund short fund beyond 2027-28? And if the 1 January 2027 fuel excise and road-user charge increases do not proceed—and I’m not necessarily asking for a yes or no confirmation here tonight; but if they don’t proceed, I’m assuming that a certain amount of thought would have already gone into what revenue would be foregone in 2027-28 and 2028-29. What kind of activity classes does the Minister sort of foresee or assume is going to absorb that loss?

20:41

Thank you to the member for her questions. They’re good questions, and they deal with some tricky issues that the Government’s confronting and which future Governments will have to confront no matter the political stripes of who is in Government. I also thank the chair of the Transport and Infrastructure Committee for his very sage comments, and I just, in passing, appreciate your engagement, Mr Foster, as part of a very hard-working committee on a range of different issues.

I think it’s good to see a level of maturity around these challenges in the Chamber tonight, because we do need to be up front around the fact that we do have a transport funding challenge, there’s no doubt about that, and future Governments are going to have to deal with it. No one wants to put up fuel tax. I get it. The last Government didn’t want to put it up. In fact, they cut it for a while and then, eventually, life had to go back to normality at some point. No one wants to put it up, but in real terms, so in other words, after inflation, it’s gone down by 20 percent since 2020—21 percent, I think it is, or it might be 22 percent—because no one’s put it up since 2020.

Prior to that, we had a moderate escalation in fuel taxes generally before that. Since then, we haven’t had it. COVID is the reason for that, and cost of living challenges. Now, they’re baked into the system. I get that one wants to put up fuel tax—we don’t want to do it either—but at some point, you’re just delaying the pain and you’re delaying the inevitable. In answer to the member’s question, we’ve not made a call yet on the tax rises scheduled for 1 January 2027. We see it as unlikely, but we haven’t made a decision yet, and so, when we do, we will let you know. In relation to the size of the fiscal challenge in relation to that, the short answer is it depends, because it depends on how much you defer them or cancel or push them out. The short answer is it depends. There is a fiscal trade-off.

To return to one of the central theses of the discussion tonight in the Ministry for the Environment hearing, or the Ministry for Cities, Environment, Regions and Transport hearing as well, these things have trade-offs and the reality is that our system, as the member rightly notices, is meant to be user-pays—it isn’t anymore. Back in 2017, it was broadly user-pays. Now, 40 percent of transport spending is from the Crown, and that comes with trade-offs—schools, hospitals, defence force, justice, corrections, police, and all the rest of it that we have to fund. There are trade-offs and the Government is working hard on broadening the range of funding tools because, frankly, a blunt use of just fuel tax as the proxy for road usage is not necessarily the right way to go about it. It’s imperfect, but there are other things you can do.

Tolling is one thing we’re looking at. We had a discussion down the line tonight at Buddle Findlay about greater use of tolling, which I think, broadly, people support, but have just got to bear in mind that it’s no silver bullet. It barely touches the sides of some projects. It’s a useful supplement, but it’s not a silver bullet. We talked about infrastructure funding and financing levies. Parliament’s just unanimously passed legislation to broaden the use of those in relation to transport projects and State highway projects. That will be a useful supplement, and there’s a range of other things we could look at as well.

We’re keen for broadening the revenue base and we’re keen to use different tools in order to make sure we can get projects away, but we can’t get away from the central conundrum of transport policy, which is: everyone wants stuff for which there is not enough money. I am sure that Tracey McClellan, and I’m sure that Dan Rosewarne, and I’m sure that Shanan Halbert will have transport projects they’re keen on, and I can tell you for free, because, no disrespect to you guys, but I know these colleagues better. I can tell you that my associate the Hon James Meager has got a list, Miles Anderson’s got a list, Dana Kirkpatrick’s got a list, Cameron Luxton’s got a list—everyone’s got a list, right. Everyone’s got a list of stuff, and sometimes I feel like Scrooge McDuck having to say no to everybody. Although, half the time it’s not my decision because it’s the transport agency’s, so I just make them give the bad news. But no, I’m being slightly facetious. But there’s not enough money. We all know that.

Just in the final 30 seconds to finish this point, you can kind of bemoan all that or you can do something about it. We’re broadening the revenue; we’ve got a greater focus on asset management and driving better value for money and optimising what we’ve already got; and we’re also really keen to get the costs down, because you can do more with less if you bring the costs of these projects down, and I think everyone’s on board with that. Doing so is not quite as easy as it sounds, but we’re all up for that. We’ve got a range of work under way.

20:46

Thank you, Madam Chair. I’ve probably got a quick follow-up, but I’m going to save that to the end of this next section because I’m going to move on. The second issue is the uncertainty the Government has essentially created for councils and regional transport committees who are, and I’m sure the Minister of Transport is well aware, now working on their regional land transport plans for the next funding period. But that one statutory document that is supposed to tell them what the Government’s priorities are and what the funding ranges are—the Government’s policy statement, the GPS—isn’t going to be released now until after the election. Some commentary exists about that, but I want to ask the Minister tonight.

Instead, the councils have been given an interim ministerial statement, and, obviously, that’s not a GPS—the clue is in the name. It doesn’t provide the same statutory process, and it certainly doesn’t provide those same funding ranges or certainty. I think it’s fair to say we are three years into this Government, councils have been asked to plan the next transport programme without that Government transport strategy, without the settled funding ranges, and without knowing what will actually be affordable. Can the Minister tell us tonight, or tell the committee, what document regional councils—essentially, what are they supposed to be basing these 2027-30 regional land transport plans on, and what legal status has this interim statement under the Land Transport Management Act? What is the legal status of that under the Act? And while I’ve got the Minister’s ear, can we also kind of have a look at what the revised timetable for the 2027-30 National Land Transport Programme would be? Actually, I suppose, simple questions like: can the New Zealand Transport Agency (NZTA) actually adopt a programme without the new GPS being in force? That’s a start. I’ve got a couple more questions along those lines, but I think that’s enough for the Minister.

20:49

Yeah, good questions. The current Government policy statement (GPS) period runs from the 1 July, 2024 through to 30 June, 2027 next year, so we’re actually over halfway through, but it’s still quite a long time to go, right. We’ve got through to end of June next year. The answer is yes, and New Zealand Transport Authority’s planned and budgeted for all of those things. So, yes, they can expend money.

Just working backwards a bit, there’s no legal status of this statement. Formally, we have to consult on a GPS in advance of 1 July, 2027, and the intention is to do that. The real question is: when do you do that? We could have gone out and done it now, but there are a couple of challenges with that—in fact, multiple challenges. Number one: you’ve got the ongoing uncertainty with the fuel situation, so that’s a challenge and makes it difficult to plan. I accept that that may still not be quite as good next year, but we are where we are. Number two: you’ve got the election in the middle of all of that, and the election campaign—it’s just a complication, from a sequencing point of view, and there’s nothing you can do about that; it is what it is. The third thing is that we’ve just started this Infrastructure Commission deep dive into transport funding costs, and I’m keen to get the lessons of that from quarter one next, because we’re given until quarter one next year to do it. So I’m keen to get the lessons of that so that we can adopt some of those recommendations when it comes to the Government policy statement (GPS). Finally, there is also the land transport reform work that we’re starting to get under way now, and I want some of the early insights into that work to help inform the GPS next year as well.

So, to be honest, we kind of weighed it up. It is not an easy decision, but we think it’s the right decision. In the meantime, I wanted to give a clear steer to the regional land transport committees and councils around what they should be thinking about for the next GPS. It hasn’t got a huge amount of attention, but it’s actually worth people reading it, because the system is under stress, as we’ve just been discussing. The paper notes that, and the next GPS will focus on value for money and cost discipline; making better use of the existing network; committing to service and system capacity increases before new infrastructure; maintenance, operations, and renewals; stronger asset management and better information on asset condition; resilience, which I know many members of the House regard as a significant issue, particularly in parts of regional and rural New Zealand, but not just there; transit-oriented development, which has a specific mention in the new draft GPS; supporting housing growth through alignment with spatial plans and concentrating development around transit nodes, key corridors, and strategic connection, and I think I’d be right in saying that’s never appeared in a GPS ever before, but it’s part of this Government’s drive to align land-use plan, through the new planning system, with transport plans made through the Land Transport Management Act and via the New Zealand Transport Agency; and then, of course, safety, which continues to be important as well.

So there’s quite a bit in this document. We’ve sent it out to councils, I think—have we sent it out? People are looking at me quizzically—hopefully, we have. We will have sent it out to councils so people are aware of it; it was only last week and there was quite a bit happening last week, as we all know. So that’s gone out. It doesn’t have any legal status but it will guide the next draft GPS. If we are fortunate enough to be re-elected, then the intention will be to get on with that soon after the election.

20:53

Thank you, Mr Chair, and thanks to the Minister for his comments. I had some really specific questions about the guidance that’s gone out—I mean, to the extent that he is able to comment on what might be possible under the next Government policy statement (GPS). Under the most recent GPS, there was a lot of constraint on activity classes and what they could be used for, and there was an explicit banning of a multimodal approach being funded from the State highways activity class or the local roads activity class and maintenance and renewals.

As part of the getting better value for money and getting outcomes we want in urban centres, does he think it will be possible for funding for maintenance and renewals of local roads to go towards improvements for pedestrian and cycle access or safety? That is one way that we can make better use of our existing infrastructure, by enabling more people to use a given amount of road width, and doing it as part of everyday maintenance and renewals is a lot more cost-effective for councils.

20:54

I’m not going to get ahead of the development of the Government policy statement. Cabinet’s yet to make decisions on that; you’ll have to wait until, hopefully, next year.

OK, fair enough. But, like, the point about enabling a better and more flexible use of funding to deliver on transport outcomes—is that something that councils could be thinking about now, or not really?

20:55

I’d just refer the member to the statement. There’s quite a lot in that, to be honest. It’s quite detailed and it’s not just high-level motherhood and apple pie; there’s quite a lot of stuff in there for councils to think about.

The other point I’d make—and I don’t want to speak for too long, because I’d use up all the other Ministers’ time for the other portfolios—I mean, let’s be honest about it: the Government policy statement system settings are suboptimal. We provide these activity classes, there are funding ranges, and there’s a whole suite of problems with that, and that’s partly why we’re doing the land transport reform work. We’re at the start of that process, to have a look at whether there’s a better way. That is a modern artefact in the sense that it was only created in 2008 onwards, actually—it was only 18 years or so ago, so things can change—it’s not the way transport funding used to work before that; it was a completely different system and now is probably not the time to get into that.

We just want to have a good look at that system, because I think everybody would be a bit frustrated—councils, too, by the way; I mean, the fact is that the three-year cycle is part of the problem, right? Theoretically, they’re 10 years, but they’re actually not: people focus on the three-year window. I meet councils up and down the country every day, and the member will have met them when she was Associate Minister as well. And they say, “Oh, you know, we can’t plan because we keep being told it’s the 2027-30 period or the three years after that, but we don’t know if there’s any certainty of the funding, so do we do the work now or not?” It’s a nightmare of a situation, and people spend their lives creating regional land transport plans, which would require extensive consultation. By the time we’ve actually finalised the land transport plan and the New Zealand Transport Agency’s come in with the co-funding, we’ve got to start again on the next one. It’s no wonder people get demented by this stuff; I mean, I get driven demented by it and I’m a Minister.

Anyway, there’s got to be a better way, is the short point—slap a hashtag on it. I think we can do it, and I look forward to the member’s support.

20:57

I wanted to come to the topic of the appropriation that was not explicit in how much it was to assist public transport operators with higher diesel costs, and I just wanted to know if at some point it will be reported to Parliament how much has been allocated and to which public transport authorities, and what is the process for public transport authorities to apply for this funding. We’ve heard from different operators that they’ve had much, much higher costs, like just the ferries in Wellington, for example—you know, there’s an electric ferry, there’s also diesel ferries, and they were copping higher costs of, like, a million dollars a month earlier in the year, and obviously they don’t want to have to put up fares, because that will reduce patronage—it’s the same with the regional council. So I was just wondering what the process is.

20:58

If the member puts these questions to me in written questions, we can probably come back to it. These are operational matters for the transport agency. The amount is commercially sensitive to allow for negotiations. If there is money used, then it will eventually be reported to Parliament, obviously, in due course. But the member will have to put the questions down in writing, to the exact specifics. The point is, there’s money there for targeted support for public transport authorities on the way through during the fuel situation.

Thank you. The Minister told us that everybody wants some funding for transport projects. There is an abundance of different transport projects, but I do want to turn our attention now to the roads of national significance. I think that’s where the gap between what the Government promised and what can actually be delivered becomes very clear.

We have a programme estimated at around $56 billion. I think the Minister himself characterised this as a “finger in the wind” figure. Parliament is now being asked to appropriate a substantial sum of money, yet the New Zealand Transport Agency has, to date, been unable to provide the committee with a project by project forecast on what will actually be spent this year.

The chair of the Transport and Infrastructure Committee alluded to the fact that both the roads of national significance and the roads of regional significance were sort of bundled together, and I have a couple of questions about that. At the same time projects are being pushed further and further into the future, and we do know that money, in the meantime, will be spent on planning. It will be spent on buying property for roads that may or may not even begin construction for several years. So can the Minister tell the committee how much of the $1.3 billion—or $1.298 billion—for major Crown investment projects is allocated to roads of national significance and how much is actually allocated to roads of regional significance.

It would be good if there was some sort of breakdown of that. Further to that, can the Minister tell us how much has already been spent on acquiring property for projects that are now in phase 3 of that pipeline. I don’t need to remind the Minister that there was a recent announcement where some of those projects were bumped down. But I’m assuming that money has already been spent. So how much has been spent for those projects that are now in phase 3, and what happens to the property if those projects don’t end up proceeding?

21:01

Thank you, Mr Chair. Well, there’s quite a bit there. The major transport projects pipeline, which the Government published—well, the New Zealand Transport Authority (NZTA) published it—a couple of months ago is an attempt to actually spell out for the public and the sector what the sequence in the pipeline is, and that’s what’s actually been widely welcomed by the transport sector and the infrastructure sector, because it gives a sense of when things will happen.

It’s not locked down to X year or X month or anything like that, but it’s a sequence, and we’ve always viewed the major transport projects pipeline as not just about roads of national significance—by the way, there’s the North West Rapid Transit project in there, there’s the Eastern Busway and other projects, very important projects—as a sequence and I think people kind of know intuitively that you can’t build 17 roads all at the same time. Not only could you not do it, you couldn’t fund it and you’d destroy the market and inflation would go through the roof and all the rest of it. There has to be a sequence, and so that is the sequence, and the honest truth is that some projects are more ready to go than others and are needed earlier than others, for example, Mill Road—

Waikato Expressway.

Well, the extension of the Waikato Expressway is a road that was fast-tracked by the previous Government. People say it was fast-tracked; it was actually David Parker’s fast track—people forget about that. So it was fast-tracked by the previous Government for the consent—

Ours was good.

OK, well, leaving that aside, then there was no money, and now we’ve funded it. So that’s the reality of it, and we’re going to get on with that and in fact the NZTA is in procurement for that now, for the offline and the online sections. So it’s always been a sequence. It’s always been a coherent pipeline and some projects are further away than others.

In relation to the member’s point, or question, I suppose, around property acquisition and property liability, the NZTA owns property all over the place. They own rental properties in Mount Victoria that they’ve owned since the 1970s, and that’s because of the on-again, off-again second Mount Victoria tunnel. The NZTA is a landlord all over the place through rental properties and other things. So the NZTA sits on the land and if they don’t need it, they dispose of it. Otherwise, they own the property and there’s a revenue stream often from those properties, sometimes there isn’t, and then there is obviously a property liability incurred with designations that occur as well and other sort of legal processes around that.

So what we’re doing, or what NZTA is doing, I should say, is just getting on with the job of progressing projects so as funding becomes available they are ready for construction. Some projects are further up the kind of curve of construction readiness than others, and that’s publicly available for everybody. So rather than have this kind of show and tell routine and everyone ask all these questions and that sort of stuff, it’s all publicly available. We’re not trying to hide anything here. It’s all publicly available.

Is this process such a nuisance?

Well, it’s publicly available and my point is that that’s a contradistinction from the past, when communities would get very excited about projects that they thought were going to happen and it turns out they weren’t because they’d been misled, frankly, often by politicians, to believe that things would start immediately when they were never going to start. Both sides of politics have been guilty of that in the past.

In relation to the major Crown investment programme, otherwise known as the New Zealand Upgrade Programme, that is actually, without being too political about it, an example of over-promising, because, as some members of the House know, that was an attempt to basically make announcements about projects that were nowhere near ready for funding. Hence why the project cost blew out massively, Otaki to north Levin being a classic. It was meant to be $817 million, from memory, and it’s now going to come out at the thick end $2 billion.

It was actually $400 million.

The figure I remember—the figure when the announcement was made by Grant Robertson and Jacinda Ardern back in March 2020, I think; February it might have been—is $817 million. I thought that that was a cheap four-lane road from Otaki to north Levin, and lo and behold, it’s not based on anything other than a literally back of the envelope figure. People just estimated the costs, and then people thought the road would start. That was announced in 2020 and here we are in 2026 and it’s finally getting under way, which is great. We support the road but we’ve got to get out of this habit of just making big spending commitments and big policy promises and pretending that things will just happen without doing the work. So we’re trying to stop all that stuff.

21:06

Thank you, Mr Chair, and thank you, Minister, although I certainly do remember there being quite some fans here from the Minister and the Minister’s party.

Anyhow, the New Zealand Transport Authority (NZTA) told us through this process, and it’s mentioned in the report, that there is currently no definition of high value and high risk. But the Minister has said that Cabinet has oversight, and sufficient oversight, of high-risk and high-value projects. It might seem like a small question but it’s something that leaked out, and is of particular interest to me—if NZTA are unable to define that or have no clarity about what that definition is and yet the Minister has provided us with a sort of certainty that that’s been taken care of at a Cabinet level, I’m just wondering if the Minister can elucidate on that somewhat. If I could just go back a step, because I didn’t get a chance to ask after the general policy statement (GPS) question, the Minister talked us through the delay in the GPS and the rationale for that, I accept that. But while I have him can he also confirm whether the next GPS will direct 60 percent of that investment towards maintenance and renewals as has absolutely been suggested should happen in that national infrastructure plan, and that will just round off that section nicely for me. Thank you.

21:07

The short answer is Crown funded high-value, high-risk projects go through the Cabinet investment management system process and that assurance work that goes into that. In fact, the Government announced extensive changes to that to make it more streamlined and provide better quality assurance to Ministers. I probably don’t have time or, frankly, the energy to get into that tonight, but rest assured we are taking on board many of the criticisms of it and I’ve been intensely frustrated at the way in which the system doesn’t work, actually, in relation to assurance. So we’re making those changes.

In relation to the New Zealand Transport Authority’s processes, they have the National Land Transport Fund, obviously, and board has operational authority to make decisions in relation to that. But for high-value, high-risk projects, they can also go through the investment management system assurance process as well. To give you an example, there is the Northland Expressway, a road of national significance that just got announced for stage 1 and has gone through extensive gateway processes as well. So the short answer is that it depends.

21:09

I just want to ask a couple of questions about maintenance and local roads in particular, and I suppose that sort of cost shift for councils. We touched earlier on the fact that councils can often get left with those unfunded mandates to do various bits and pieces. Certainly, from my perspective, while the Government has been talking about fixing potholes and getting transport back to basics, the evidence from NZTA to the committee tells quite a different story. They warned that councils would be struggling to meet what is their share of the maintenance cost and could end up restricting the use of bridges. They could end up using cheaper materials or finding other ways to reduce what is then their maintenance responsibilities. And at the same time, only $600 million of a $3.2 billion road maintenance target has been actually directed towards local roads, despite, obviously, the fact that local roads make up the overwhelming majority of the network. I understand that that doesn’t necessarily mean that’s where the overwhelming majority of people are using a road at any one point in time, but that is the nature of the network. On top of that, the Government intends to transfer six special purpose roads to local authorities.

With the future funding, I think that the split on what that future funding might look like is still unresolved, and so I suppose my question to the Minister is: NZTA told the committee that the current funding settings could lead councils to restrict the use of bridges and to use cheaper sorts of materials, so has the Minister had those conversations, does he accept that NZTA assessment, and, if so, has any thought gone into what he might do about it?

With regard to that $3.2 billion fund that I mentioned, can he explain or walk us through why only $600 million of that fund goes to local roads, given that they do make up the overwhelming majority of New Zealand’s road network?

21:11

Well, in relation to the special purpose roads: those are matters for the transport agency and they’ll be considering that. In relation to local roads, I mean, it’s like everything. As we’ve talked about for 40 minutes now, there’s never enough money for everything. Local roads are very important. It’s co-funded through the transport agency and local councils via rates. Often, to be honest, one of the challenges is that councils are allocated money which they don’t spend, and I get perennially frustrated when I see the reports of councils that have had money allocated to them for local projects that they fart around not progressing. That’s intensely frustrating because, at the same time the council is complaining about being underfunded, not having resources, often there’s money there and they don’t spend it. It’s sort of like “Don’t come and complain when you can’t even spend the money that’s been allocated.”

Now, in their defence, I partly understand the three-year NZTA - GPS - NLTP - RLTP acronym soup process which has gone through all of that. It’s not entirely their fault, but often it is, and I encourage them to get on with it. Part of the issue, to be honest, just while I’ve got my talking stick, is the convoluted planning processes we make councils go through. They’re often very, very simple projects, and, you know, people are waiting around for six or nine months before they can spend the money because they’ve got to do a consent and go and get a permission for doing that, and they’ve got to do a local business case for a very small project. I mean, I get very, very frustrated by all this stuff, and so the Resource Management Act reform will help with that. Culture change inside councils would help too, frankly. The point is that the local roads are the backbone of the network. We’re going to continue to invest in local roads, and, in the same way, we’re going to continue to look after the State highway network, which is very important maintenance and operations of that.

21:13

I note that today the notice of requirement designation was lifted for the East-West Link. I thought I’d share with the Minister that on the weekend I was doorknocking in my electorate in Hātaitai, and a number of people raised concerns about the proposed Mount Victoria Tunnel changes and how they would adversely impact residents in Hātaitai and Kilbirnie. Given that there’s no way there’s going to be funding for the Mount Victoria Tunnel any time in the next decade or two, what should I say to those constituents? They kind of can’t move on with their lives. They’re not going to have their land taken by the New Zealand Transport Agency (NZTA), but, presumably, NZTA is going to go ahead and acquire some of the adjacent properties, which is going to leave them with no neighbours, no neighbourhood, and just living with this kind of uncertainty of maybe. You know, people can’t just move on and make our community better because there’s this fantasy project, as the Minister’s referred to. It’s a fantasy project that has no funding and will have no funding. Why won’t the Government consider doing the same thing it’s just done with the East-West Link, after 10 years, allowing other people to move on with the land development and move on and do other things with that area?

21:15

It’s not a fantasy project, and the member’s wrong when she says there’s no funding for it for 10 years. It’s not correct and I don’t know where she gets that idea from—it’s not correct. She’s the local MP for Hātaitai; I’m not, so what she says to those residents is over to her. But it is a very important project for Wellington, for the reasons that have been well-traversed by her and I many, many, many times. In fact, the New Zealand Transport Agency has just lodged a fast-track application for it, I think yesterday or earlier this week.

Yeah, but it’s not funded.

Sure.

You don’t have $4 billion.

Sure—sure. It’s not funded.

The benefit-cost ratio (BCR) is 0.7.

Lots of projects aren’t funded. The Auckland Light Rail fantasy project that you were in support of was not funded. There’s lots of stuff—

Exactly, it’s a fantasy project.

Well, there’s lots of stuff—

You just admitted it.

Lots of things aren’t.

Just for the advantage of the people living at home, it’s much easier if you stand up and seek the call, ask the question, and then we’ll get our—

Lots of projects aren’t funded—lots of projects aren’t funded. Partly what we’re trying to do is create a sequence pipeline, which is exactly what the experts say you need to do when it comes to infrastructure projects. As they become ready for funding and they’re ready for construction funding, you fund them. That’s part of the sequence pipeline. The member can see it, publicly available, for herself.

21:16

According to the list that the Minister put out, this project isn’t going to start for at least 10 years. We all know, as they’ve said, there’s no money in there. The money has to be prioritised to projects that make the best use of our limited transport funding. So I guess, I would put to him, on behalf of the residents of Hātaitai and Kilbirnie, that it would be much better if the $100 or $200 million the Government’s currently putting towards this project was put towards improving public transport right now, not acquiring land and having this shadow hang over neighbourhoods of some four-lane road, which is probably not ever going to be affordable or makes sense.

In the most recent thing that was sent to me, released under the Official Information Act—and I’ll be happy to table that—it says that the BCR is less than one; it’s 0.7. It’s clearly one of the lowest priority of the roads of national significance; there’s no funding available for it, and it’s limiting the ability of the community to move forward with far more cost effective improvements to our transport system.

21:17

Yeah, I mean, all I can do is repeat what I just said, which is lodging for fast track—yep, there’s some money involved in that, but we think that’s a valuable or justifiable use of money. The project is not funded at the moment. Three-point—

Just let it go! Nobody wants it.

You sound like—who’s the—

Elsa.

You sound like Elsa.

[Sings] Let it go!

You sound like my son. He’s constantly singing “Let It Go”.

Anyhoo, it’s an important project; it’s not funded at the moment. By the way, it’s not just $4 billion for Mount Victoria. There four elements of that project: there’s the basin, there’s The Terrace, there’s Mount Victoria, there’s Te Aro improvements through State Highway 1—it’s a complicated project. You know, we should have got on with it years ago, but here we are. I believe it will get built. The member’s welcome to continue to campaign against it. I look forward to having long battles on the campaign trail about it in the future.

21:18

Thank you, Mr Chair. I want to move on to some public transport questions, mainly because it’s always striking how little attention it has received over the last few years. Whilst I appreciate the Minister’s previous answer about council not necessarily always—how the frustrated he can be when councils don’t spend the money. It just reminds me of the incredible influence that a Government policy statement (GPS) can have and how important it is not to, necessarily, be delayed, because the GPS does seem to particularly send the signal to those councils. The Minister will well remember what negative impacts can happen when a GPS doesn’t signal, for instance, public transport, and councils don’t necessarily, then, go pursue work programmes on the misunderstanding that the Minister du jour doesn’t favour it and money gets rescinded.

Anyhow, I’m still banging on about how Christchurch lost $78 million, obviously. But this time round I will move on and note that public transport—well, that councils—nevertheless, often, find themselves having to fund new costs.

Since July 2025, public transport authorities required, for instance, just as an example, to purchase zero-emission buses when they replace their fleets, and yet central government has provided no specific support towards that additional capital cost or for them to just simply meet those requirements. The Government mandates that public transport authorities make those purchases, so my question to the Minister is, is he aware how much that mandate has added to councils’ capital costs since July 2025? That’s a start—if he could answer that, that would be much appreciated, and his answer to that will guide my next question.

21:21

I’m advised that the bus mandate was a previous Government policy that we decided to keep. The Opposition regularly likes to—

It’s a good policy—where’s the pūtea?

Well, the Opposition regularly likes to say that we tore up climate policies. It’s true in relation to some policies, but it’s not true in relation to this one. I’m also advised that there is no extra cost because the whole-of-life costs of buying an electric bus are cheaper than buying a diesel bus.

Thank you, Mr Chair. I just want to get some clarification, because it was more than $78 million that Christchurch lost; it was over $800 million, and part of that was the $800 million that was on the draft Government Policy Statement for land transport for mass rapid transit (MRT). We’re just wondering how that disappeared and whether it is a priority commitment of this Government to reinstate for MRT for greater Christchurch?

The other question I do have quickly is around the Woodend Bypass. I noticed the member of Parliament for the electorate has just recently that it’s great to see that work is under way on the Woodend Bypass. I’d just like to check whether that is actually a correct statement?

21:22

Taking them in reverse order: yes, work is under way, but it’s not construction work—as in, it’s not the main construction work. But there is work happening down there, obviously. The member can see it for himself.

In relation to mass rapid transit for Christchurch: there’s never been $800 million for mass rapid transit in Christchurch. I’m advised that was the overall cost of the project if it happened.

It was on the draft.

Well, there was no money for it; that was just the estimated cost—not funded or anything like that. It’s not worth going back through the potted saga of the money that was for the business case. It was a very expensive business case by the way, which is potentially why the council gave it up. It’s now funding Brougham Street, which I’m sure the member is very happy about—or partly funding Brougham Street.

Look, I’m actually conceptually interested in rapid transit in Christchurch, but here’s the point: there’s very little point in standing up and saying “Well, let’s build trams and light rail in Christchurch”. Let’s do the work. Let’s do a spatial plan for Christchurch and the surrounding area; let’s think about, over the next 20 to 30 years, what we’re going to build and where we’re going to build it; let’s think about the transport plans. Planning reform and the Resource Management Act changes we’re making will allow for all of that to take place in a structured way—involving the Crown, too, by the way, because that’s an important part of it. Then, let’s build up the evidence base and the case over time. Let’s get away from immediately jumping to “Wow, look at these great, stylised pictures of trams down Brougham Street or light rail cars down Dominion Road”. Let’s actually do the work before we start to make major investment decisions. There’s been too much fantasy stuff—too many fantasy-land projects, too many people interested in the AI, stylised drawings.

You’ve changed.

I’ve changed? I’ve certainly got heavier in the last three years.

Roads of National Significance are what’s a fantasy.

Well, no—on the Roads of National Significance, no one ever promised they would all start straight away. That’s not true. We always said they were a part of the pipeline; they remain part of the pipeline—in fact, six of them are about to be or are under way. The Hawke’s Bay Expressway—I note that Katie Nimon has entered the House, and she knows all too well. You can see it. You can drive down it right now. The road widening is under way, and you can see the projects happening around the country. You can see Ōtaki happening—Ōtaki to north of Levin. Cambridge to Piarere will soon be getting under way, and the Northland Expressway, stage 1 is underway or soon to be under way as well. People can see them, but they were never all going to be built at the same time. People who say—

You just want to do it on your terms.

Well, I think that’s—in relation to Northland, it was actually in the last Government’s draft Government Policy Statement (GPS) as well, by the way, which is a fact that is conveniently forgotten about by members opposite.

Four lanes?

Yeah, in David Parker’s last draft GPS was stage 1 of the Northland Expressway. The previous Government said that they were interested in funding it.

As it should be.

Exactly. That’s my point—that it’s a good project, which is why the last Government was interested in it as well. But we’re actually getting on with it.

I’ll just let members know that we’re into our last five minutes.

21:25

Just following up on my colleague’s question: $78 million for public transport futures was a package of cost-effective bus improvements that would massively increase frequency—

Oh, OK—sorry.

—and practicality of buses. The Minister says that the Government is in favour of public transport and that public transport operational funding has increased, but outside of Auckland, it hasn’t, and there is a desperate need—particularly in a city like Christchurch, which is growing very quickly—to improve bus transport. It’s something that could be done in a short period of time, but there’s nothing for it in this Budget. Could the Minister find some funding for it?

21:26

Well, not at 9.26 p.m. at night on Wednesday, I’m not just going to magic up money. Nicola Willis has just called me, as it happens, while you were talking. You never know, she could have heard your exhortation. It could be good news. I don’t know if anyone’s ever been in the chair and rung another Minister on the phone—that may be a breach of Standing Orders, and almost certainly is.

The short answer is that we’ll continue to look at sensible improvements on this stuff, but I’m not going to make any funding commitments on the floor of the House.

We’re running so close to the edge of Standing Orders that I’m not about to interfere at the moment.

21:27

Thank you, Mr Chair—and I know that we’ve only got a very short amount of time left. The cost of replacing 22 State highway bridged rises from around $110 million in this National Land Transport Programme period to between $300 million and $400 million in the next. Can the Minister tell the committee the total deferred bridge replacement liability across both State highways and local roads? Essentially, things are more expensive if they’re delayed. There are a lot of things that have been pushed into phase—there’s a lot of things being pushed around. If the Minister can just give us a little bit more detail on that, that would be amazing.

The short point is that the $110 million is for nine bridges that are needed to be done now, and there will be further work and further funding required as we move on. We do have an end-of-life bridge issue, but it’s also important not to catastrophise it. Some of the bridges are very old, there is no doubt about that, but they also have economic life left in them.

While the member is of course correct to say that things only get more expensive—that is true—respectfully, that’s also not an argument for funding the update of things or the replacement until they are required. That is also expensive, because it comes with trade-offs around the best value use of dollars. It is obviously true that it’s cheaper to do things now, but that would be an argument for doing everything right now. We don’t; we phase and sequence things out.

The New Zealand Transport Agency (NZTA) is just getting on with the job of the end-of-life bridges that are right around the country. Some are more complicated than others. The $110 million is for the nine needed now. We’re getting on with them. There will be further work and further funding required. Maintaining the State highway network and the end-of-life bridges on it and just progressively chunking them off over time is really important. I think it’s important not to catastrophise the problem. It’s a challenge, but we’ve got the money there to do it, and NZTA is actually getting pretty good at doing them in a very standardised, sensible way.

21:29

Thank you, Mr Chair. Some very quick questions—

They will need to be.

—because we have already talked about the additional Waitematā Harbour crossing. Questions for the Minister: what are the expected costs related to the detailed business plan, and what are the anticipated costs to reopen the option from Meola Reef to Kauri Point in his projections, and where abouts is that funding sitting?

Cabinet has capped the Meola option at $1 million—50 percent from the Crown and 50 percent from the council if they choose to take up that invitation. But we’re not spending more than a million; it will come Ministry for Cities, Environment, Regions and Transport (MCERT) baselines.

In relation to the detailed business case, I don’t have those figures to hand. If the member puts it down in writing, we can have a look at that. There will be a cost in relation to the detailed business case. A lot of it will be funding through the MCERT and New Zealand Transport Agency standard operational funding. If there needs to be more, we will consider that in due course.

Members, the Minister’s time in the chair has come to an end. We now have the Minister for Tertiary Education. The Minister is available to speak to that portfolio until 10 p.m.

21:30

Mr Speaker, thank you very much. As the chair of the Education and Workforce Committee, I have the privilege of chairing this Estimates hearing with the Hon Penny Simmonds as the Minister for Tertiary Education. For those that don’t know, Tertiary Education is a separate Vote to Education and has about 2 percent of spending in the Budget 2026—a nice symbol of the importance of tertiary education to the future of our economy and, of course, the report details the amount of funding to which areas within the Budget, which I’m sure we’ll go into.

We talked about the financial sustainability of the sector and funding settings of the Budget as well, but particularly focused on measuring performance of tertiary education, student financial hardship—which is a topic that comes up every year, inevitably—but we focused a lot on those Not in Education, Employment, or Training (NEETs) and the importance of the tertiary education sector in focusing on reducing the number of people not in education or employment or training, and the many different programmes in place to address that. We talked about the better utilisation of the fees-free scheme funding. We talked about work-based learning. As well as that, I think very important to point out that it is the last hearing that would involve Te Pūkenga as an establishment—as it is being disestablished—and talked about the polytechnics and their re-independence and the future of those institutions.

The interesting conversation around the enrolment growth and strong balance sheets of wānanga, and then the industry skills boards that have received additional funding to help make sure that they are providing the appropriate pathway for the workforce; the fact that research funding has been unchanged in Budget 2026. We talked about the importance of international education programmes and, as well as that, an always interesting topic to talk about: the use of artificial intelligence in the tertiary education sector. With that, I think it’s very important to have a fulsome debate on this topic and welcome anyone to read the report.

21:32

Thank you, Mr Chair. Just to acknowledge both the Minister this evening and our Education and Workforce Committee Chair, Katie Nimon, for the work that they’ve done in this Estimates process. I do note that funding has decreased between years by $185 million, and on top of that is the $1.1 billion cut to fees free that was allocated and invested in the young people studying in New Zealand. The Minister has been with me across a few debates, now, where we’ve experienced the green debt monster because people are very concerned about the amounts of their loans, that study is becoming more expensive, but I haven’t seen that this Budget really responds to those particular challenges, and so that will frame the first part of my questioning for the Minister tonight.

I’d like to understand: why was the decision made to allow tertiary institutions to increase their fees by yet another 6 percent? The Minister will understand that hits a 19 percent increase in student fees over her time in three years. What is the total amount of the annual maximum fee movement that has increased under her watch? I’ll start there.

21:34

Thank you, Mr Chair. As per the previous Estimate debates, I’ll dump my five-minute contribution out of the way so that I don’t have to keep constantly timing myself. Just wanting to acknowledge and thank the Minister for her respectful engagement over the last two years. This is going to be the last Estimates debate we’ll be doing in this Parliament, potentially forever, depending on the outcome of the election for myself.

It was good to see the Minister at the Otago University Students’ Association (OUSA) leaders’ debate. I was a little bit confused to see her because it was called the OUSA leaders’ debate but then I read the day before that there were some leadership ructions within the National Party, but I didn’t realise that it would happen that quickly. Then I saw my colleague Shanan Halbert there as well and then I realised that it was actually broader than just leaders.

My question is around three streams, around the issue of student poverty, around the fees-free scheme, and around the issue of polytechnic support. I’ll start off with a really crucial issue which is the issue of student poverty. The Minister might recall that I sent her a letter on 31 March 2026. It was around the recently released report that we released around the issue of student poverty around Aotearoa New Zealand. My question around that is: did the Minister read that report and are there measures in this current Budget or any planned Budgets within the Estimates period that would alleviate some of that student poverty issue? What cost of living measures were specifically considered for students, given that they were excluded from the cost of living fuel crisis support?

I note that during the Vote Tertiary Education hearing the Minister said that she would have a look at the idea of potentially raising the course-related cost, which has not risen since 1992, except for a brief period in 2020 when it was raised to $2,000 around the COVID support. That could be a good way to enable a slight measure of cost of living relief for students without unduly stretching the Treasury.

I’ll turn now to the issue of fees free. The Government has raised the number of youth guaranteed placements from 1,000 to 2,000 as part of their initiative, as part of the proceeds of scrapping the fees free. Is the Minister aware that in the final year of the first year of the fees-free scheme that the vast majority of students who received fees free were actually from polytechnics—6,000 out of the 10,000 that received that in 2025. The last year of the first year fees-free scheme were polytech students. Why wasn’t consideration given to potentially boosting polytech support or potentially even making polytechs free for students, as happened in some great institutions like the Southern Institute of Technology?

My last question is around the polytech support line in the Budget. You can see in the Vote Estimate line that there’s allocated Budget lines that have been earmarked for polytech support that have had quite significant underspends around it. For example—I’ll just read this here; it’s hard when you have multiple tabs open—of the $25.2 million fund that was allocated, only $6 million of it was spent, so there’s a $19.2 million underspend around that fund. Why has that occurred at the same time when, over that financial year, some polytechs have had to make some really tough decisions to stay financially viable? For example, Taranaki has reportedly had to cut 20 percent of their staff, for example. In my own area—Otago Polytechnic—we know that around 100 roles have been lost and I feel like there could have been potential reallocations of that fund.

Why was there an underspend of that fund and what will happen to the washup of that unallocated funding? We also see that there’s support for a polytech property management line that ended in that period. Are there any considerations for any further supports that will be further given to polytechs? I’ll use my remaining minute to ask any follow-up questions that might arise from the Minister’s answers.

21:39

Thank you, Mr Chair, and thank you to the two members. I agree that the Otago University Students’ Association debate was done in very good humour and, while there wasn’t raging support for the right, I can say that it was all done in very good humour, so thank you to those that were there supporting us.

Turning to the questions from Shanan Halbert, Labour’s MP, the Annual Maximum Fee Movement—yes, look, the 6 percent increase, or the ability to increase fees by 6 percent again, ensured that for that period from 2018 to 2026, the fee increases were roughly aligned with what the cumulative inflation was over that period. So it has taken the fees, essentially, in line with what inflation was over that period.

In terms of student poverty—the question from the Green MP—New Zealand student contribution versus the public contribution is about average in the OECD countries. About 74 percent is contributed by the Crown and the remainder by the students. Actually, interestingly, at the OECD debate when that question was asked, it was really obvious that most of the audience had no idea that they were subsidised to that amount. So it’s about average in the OECD countries. Certainly, interest-free loans are the main way in which we support students, and they remain interest-free as long as graduates stay in the country. Hardship grants are available through a number of the institutions. They may be eligible for student hardship assistance. Student allowances, of course, are targeted, and they are inflation adjusted on 1 April each year. This year, they went up by 3.11 percent on 1 April, which impacted about 52,000 students.

In terms of additional assistance—and I think we’ve talked about that in the past, or recently—in terms of the costs associated with the particular cost of living shift with the Middle East conflict, I acknowledge, yes, that it’s costing students more to get to their studies, to their placements and things, but we have remained firmly focused on any assistance during this period being targeted and timely and temporary. We consider that students have access to more assistance, such as the hardship grants and the accommodation support, than perhaps the other areas where we’ve provided assistance.

We’ve looked slightly quizzically at each other—oh, you’ve found something that might be referring to it? Ah, right. You asked about the unspent portion of contingency. That has been transferred through, and it is just a timing issue of when these funds are needed. So thank you for bringing up that point and allowing us to clarify that. In terms of the Western Institute of Technology at Taranaki, they are still within the New Zealand Institute of Skills and Technology (NZIST) at the moment, so those decisions are being made under the umbrella of NZIST.

But can I just tell you one story of today. I did a visit to the Universal College of Learning (UCOL) and was absolutely thrilled to see the progress that UCOL in Palmerston North have made. You might recall that their deficit last year was over $9 million. They are forecasting a surplus of over a million this year. They certainly have rationalised some of their programmes where they had smaller numbers going into programmes, but, essentially, they are going to do over 100 percent of their level 3 and above and level 1 and 2—oh, sorry Mr Chair—

Oh, yeah, so carry on.

Thank you. I’ll be very quick, I promise you. So level 1 and 2, yes, they are running out of a bit of room there, and we were just talking about the possibility of what additional funding might be available for them. So an absolute success story, and I congratulate the staff and management and governance of UCOL. Thank you.

21:45

Excellent. Just to follow up on that with the Minister for Tertiary Education, I guess I just want to understand her rationale for why it was necessary to increase student fees for the third time given that she also cancelled Fees-free, which means a $12,000 loss for particular students. We find ourselves in a cost of living environment where, you know, surveys from Victoria University are telling us that hardship is deeply there, and she’s invested less in the overall budget than she did last year but is charging students more. So what is the rationale there, Minister?

Have another go and I’ll do them together.

OK, thank you. So just to follow up there: what is the proportion of the transitional funds that have been allocated, and what additional requests has the Minister received throughout that period which she may not have allocated at this particular point?

21:46

Thank you. Why was it necessary to allow increases in fees? Well, again, getting in line with inflation was really addressing the cost pressures that were occurring on the providers because of that inflation. So it was really enabling the providers to be able to address some of the issues that they were dealing with because of inflation.

In terms of the increase that we did give, the 2 percent increase that we have put in place in the Budget, that has been to the foundation level 1 and 2, because those programmes don’t have fees and therefore there was no ability for the providers of those foundation programmes at level 1 and 2 to be able to recoup any of those cost pressures.

In terms of the $157 million in contingency for the disestablishment of Te Pūkenga and the standing up of the polytechnics, that hasn’t all been used, and there are some quite big projects that are still sitting there: the Universal College of Learning’s (UCOL’s) rebuild or refurbishment and NorthTec. Both of those are substantial: the NorthTec one is $34 million; the UCOL one I think is just under $30 million. Again, the poster child for the disestablishment of Te Pūkenga, UCOL, now that it is being governed locally by people from the community, they are digging deeper into the need to actually demolish the building that’s there and rebuild new, and they’re getting a more detailed seismic assessment which is showing all the signs of being able to refurbish and strengthen rather than create a hole in the middle of Palmerston North, which the mayor was very agitated about, quite rightly. So having brought community people in to look at what the reality of that build was will actually probably result in a better outcome for that community, at, potentially, a lesser amount than the full amount that was allocated to them for that capital work. I can’t give you the exact detail, but if you want to pop that through to me in writing, we’ll try and give you—but it’s a bit of a rolling thing—

I’ve asked.

—because, obviously, things are being—you’ve asked, in a written—OK, so we’ll get what we can, but it is moving almost on a weekly basis. But we’re not going to run out of money, if you were worried about that.

21:49

Thank you, Mr Chair. If there’s money left in the fund, could Otago Polytech have some more, please? Maybe a couple of million? My second question is around the issue of—and I see that the Minister for Tertiary Education referred to universities and polytechs having hardship funds. Part of the funding for those hardship funds comes from, of course, the student services levy, which allows welfare services like that to be funded. You might’ve seen proposals floating around to abolish or restrict the student services levy. Is that something you’ve sought advice on this term, and is that something that you would look to do in the future, potentially?

21:50

Thank you, Mr Chair. No, because that is not Government policy. That’s a particular party that is campaigning on that policy, so no, I haven’t sought any advice on that. And yes, you’re quite right, the hardship assistance does come from within the universities. If I could just assure you, though, that the university sector is looking in very good heart. Last year, they had an unaudited surplus of $186 million cumulatively. That was $190 million better than they had budgeted, and $28 million better than the sector’s audited results in 2024.

The university sector is in good heart and able to provide some of that additional support to students in this time of hardship. They have had good domestic growth this year of about 3.4 percent, and also good international growth. None of the universities recorded a deficit last year, so they’re in a strong position, and the three wānanga, similarly, are in a really strong position, and the polytechnics are strengthening as we speak.

21:51

I rest my case there, Minister of Tertiary Education, because you’re saying that polytechs, wānanga, and universities are all in good hearts and they’re financially doing well, and yet here you are increasing fees for students by 6 percent once again, and of 19 percent overall in your watch. I just don’t comprehend that during a cost of living environment where students are telling us that they are in the most need that they have ever been in. I digress.

My next question is around the industry skills boards (ISBs), and it’s good to see that there is progress there. It’s not very clear about what progress is coming through. Where are we at with that and the allocation of funds to those ISBs, what are the set dates that you expect the ISBs to be up and running, and what milestones are you working to in that period?

21:52

Thank you. All the ISBs were up and running from 1 January this year, and yes, they got their annual allocation in the Budget of $30 million, but we also reprioritised an additional $3 million because I really want them to take a look at some strategic planning around the retention and recruitment of apprentices. They got a little bit of extra funding to do that, you’ll be pleased to hear, Mr Halbert.

The work-based learning (WBL) units—so let’s take a step back. What was the industry training organisations (ITOs) then became the work-based learning. They are sitting within the ISBs. They have two years to transition out as private training establishments (PTEs), and at this moment, the building construction ITO have transitioned out, the motor industry organisation has transitioned out, the hairdressing has transitioned out, and ServiceIQ has transitioned out into an existing PTE. There’s a couple more that are getting well on the way; the plumbers and gasfitters are well on the way. They’re all working through this process of the ITOs and WBLs that have been sitting in there and working through the process with industry of whether they go out into a new PTE, or into an existing PTE, or whatever configuration they are looking at.

I’m pretty pleased with what’s going on there. I think all but one have got a full complement of their board. I think it’s only one, isn’t it? It’s just got one missing. They are working well in terms of the updating and renewal of qualifications that they need to be focused on, and I believe that they are engaging well with industry. I’m pleased with how they’re getting on, and I think they have ensured that they understand the Budget and that they are working to their budget of $30 million plus the $3 million.

I must comment, it’s a very acronym-heavy ministry you have, Minister.

21:55

Thank you, Mr Chair. When we came into this term, sustainability of the sector is top of mind for anyone who is working in this particular space. In 2022, under the last Government, we launched a review of funding. That’s something that you discontinued when you started as the Minister for Tertiary Education. Where is that at and what work is currently being done in order to understand the forecast for the next few years?

Thank you, Mr Chair. I just want to ask the Minister for Tertiary Education what she has done for NorthTec, please.

Of course, I’ll start with the funding review. Thank you, Mr Chair. Yes, you’re right, the funding review that had been initiated by the previous Government I put on hold and felt there were more critical things that needed to occur and have occurred now. I’m starting to look at the funding review again for higher education, level 7 and above. Very early days; just starting to talk about the scope of that, but very early days, and really wanting to ensure that we are prioritising the areas that we’ve got skill shortages in, making sure that we’re getting good value for money, and that the sector is sustainable in the long run.

It’s worried me for some time that there are areas where we maybe aren’t training enough, and you look at dentists and vets and things like that, and what we might need to do in those areas. Look, yes, funding review, and I’m happy to keep you informed with that as we go along, but it is very early stages.

In terms of Northland, what have we done for Northland? Look, we are working really closely with the community up there. I just think the new—what are we calling them?—establishment advisory group and the initial board up there are working really well. Derek Slatter, the acting chief executive, they are working through a process with their community. We have allocated, I think, $34 million to ensure that they have a knowledge-hub in the centre of town. If it works out to be the right financial thing to do, we can get a business case that stacks up.

I’m really committed to ensuring that Northland has a polytechnic that they are proud of. We know that we’ve got high NEET numbers up there. We know that we’ve got significant needs in the wider health sector that the polytech tends to provide graduates for, and so we’re absolutely committed to ensuring that we stand up NorthTec in a way that it can be successful going forward, that it can be the heart of that Whangārei community, and ensuring that the industries have the graduates that they need up there.

Places like Whangārei, like Nelson, like Invercargill, and New Plymouth, it’s really critical, when you only have one major public tertiary provider, that they are strong, that they can operate sustainably, and that they are fit for purpose and that young people and, well, everyone in that region is proud to be part of. So, very pleased to be doing that for NorthTec.

We’re down to the last 12 seconds.

21:59

Thank you, Mr Chair. One final question is just a follow-up on the Youth Guarantee (YG) numbers. I note that there is an increase in this Budget. How did the Minister for Tertiary Education come to that particular number? Was it purely a Budget decision? When we have almost 100,000 young people not engaged in education, employment, or training, 175, Minister, is simply not enough.

Thank you, Mr Chair. I did have the number here, and it is actually more than that. It’s 5,500 that will be the total number of YG places. Yes, it’s still well short of the 100,000, however, remember that YG is a part of the whole picture, with Ministry of Social Development (MSD), YG, and other supports around that. Again, I’ll refer back, because I visited there today, to University College of Learning who, working closely with MSD, contracted to take two cohorts of MSD clients through revenue from MSD; so polytechs working together and ensuring that we are putting support and pathways in for those young NEETs to find a way to employment. Thank you for that question. Yep, it would be lovely to have more, but we’re gradually working through.

On that last set of acronyms, the time has come for me to leave the chair. I’ll report progress on this bill presently. The committee is suspended and will resume tomorrow morning at 9 a.m. to consider the Disability Support Services Bill. Have a good night.

Debate interrupted.