NEWS ON POLICY AND POLITICS
9 March, 2007

Watching Brief is a regular publication from Russell McVeagh on developments in public law and policy of interest to New Zealand business.

www.russellmcveagh.com

IN POLITICS

Taking the Environmental Tiger by the Tail
Among the consequences of the Prime Minister's sustainability focus has been the preoccupation of officials with what 'sustainability' actually means. more...

IN THE NEWS

Inquiry into the affordabilty of housing
National's Phil Heatley has been successful in having the Commerce Select Committee agree to hold an inquiry into the affordability of Housing. more...

Walking access report released
This week, Rural Affairs Minister Damien O'Connor has released the independent report on walking access. more...

The cupboard is bare
Finance Minister, Michael Cullen has foreshadowed tight fiscal management as the theme of the May 17 budget. more...

First round of consultation on Police Act completed
An analysis of public views on the future of policing in New Zealand has been published as part of the review of the 1958 Police Act. more...

IN PARLIAMENT

Bills Introduced more...

Armed Forces Law Reform Bill
Fisheries Act 1996 Amendment Bill

Bills before select committee more...

Births, Deaths, Marriages, and Relationships Registration Amendment Bill
Statutes Amendment Bill
Te Roroa Claims Settlement Bill

Bills Reported Back more...
Supplementary Order Papers more...
Bills Passed more...
Regulations more...

LEGISLATION IN THE WINGS more...

· Dairy Export Markets
· Immigration
· Softer regime for tax penalties
· Tax agreement with Dutch Antilles

IN COMMITTEE more..

IN CONSULTATION

Taking the environmental tiger by the tail

Among the consequences of the Prime Minister's sustainability focus has been the preoccupation of officials with what 'sustainability' actually means. Their confusion can be forgiven. The strands of government policy on economic transformation, export promotion, energy and high country conservation are not easily drawn together and offer - so far anyway - little in the way of clues as to an over-arching framework for dealing with climate change.

The cynic will see this is an inevitable result of elevating political spin above the substantive difficulty of reconciling conflicting economic and environmental goals. However, although it may be true that government has pinned its election hopes on the greening of middle New Zealand, the present dilemma may owe more to the tentativeness with which the Kyoto protocol was approached in 2004 when the unhappy discovery was made that foreigners would not, in fact, be lining up to slip cheques into our pockets.

At the time, afforestation was acknowledged as one part of the overall solution. Agriculture Minister, Jim Anderton, was moved to observe that the task ahead was to make forestry more appealing than other options. But with the arguable exception of the Permanent Forest Sink Initiative announced last year, there has been little in the way of positive incentive. Instead, the blunt instrument of punitive levies has been waved, placing agriculture and forestry at odds with one another in a zero-sum game that glosses questions about the highest and best value use of land, and New Zealand's long term economic interest.

Regrettably, it is an alienation of interests that is mirrored in the growing stand-off between government and forestry investors. No doubt goaded by the political liability of net deforestation on the one hand and the pointed advocacy of the Kyoto Forestry Association on the other, Minister Anderton has been moved to paint forestry investors as profiteers and exploiters of the environmental commons.

So it is that potential partners in a sustainable solution to New Zealand's looming carbon debt, instead, stare at one another across an ideological divide. Minister Anderton asserts market failure. Forestry interests assert government expropriation of private property. And, because of the political capital invested by both sides in the debate, forestry achieves a salience in government's thinking as the silver bullet, upon which all its policies must turn.

The challenge to rational and cohesive policy development that this represents is clear, as are the adverse consequences of relegating decision making based on highest and best value use of land. That challenge is not made any easier by the absence of hard economic analysis or data in the consultation documents on climate change, agriculture and forestry. The consequent risk is of a piecemeal approach that results in key economic judgments being driven by short term political imperatives and narrow solutions.

For the government, this poses major risk. Having asserted its political leadership in the fight against climate change, it must now show that it is capable of reconciling competing environmental, economic and sectoral interests in a way that engenders support, rather than opposition. It will find, if it has not already, that it has taken a tiger by the tail.

Inquiry into the affordabilty of housing

National's Phil Heatley has been successful in having the Commerce Select Committee agree to hold an inquiry into the affordability of housing. Whilst on its face a reflection of unanimity, the committee's consensus disguises very different view on the nature of the problem and its solutions. Whereas Heatley is focussed on those constraints that contribute to rising costs, such as local government zoning decisions and access to land for development, others will be preoccupied by the need for additional interventions to support first home buyers or drive excessive costs out of the building industry. The outcome of the inquiry is unlikely to reflect any unanimity as a result and government's last minute support for it could well be a sign of an agenda that will be played out in the months before the election.

Walking access report released

This week, Rural Affairs Minister Damien O'Connor has released the independent report on walking access.

Prepared by a panel of stakeholders representing farmers, and recreation and other interest groups, the report proposes the formation of an independent access organisation with the status of a heritage protection authority. The organisation, to be known as Te Ara o Papatuanuku, or The Pathway of Mother Earth, would assist in the negotiation of new access rights and, if necessary, exercise powers of compulsory acquisition under the Public Works Act 1981. An establishment board has been recommended to map existing rights and determine issues of funding and composition for the new body.

Backing away from the notion of compulsion and confrontation, the panel has placed a welcome emphasis upon negotiation and goodwill. However, compulsory acquisition remains as an available, if ultimate, recourse. Whether any empowering legislation does violence to the principle that any acquisition of private land should be compensated, or otherwise relies on the idea of "access orders" to circumvent the need for compensation remains to be seen. It will be one to watch.

Officials will now prepare a response to the recommendations, looking at the implications of implementation. This is expected to be completed before the end of the year.

The cupboard is bare

Finance Minister, Michael Cullen has foreshadowed tight fiscal management as the theme of the May 17 budget. No new major spending or tax cuts are expected and a further tightening of fiscal condition is, according to Dr Cullen, on the cards. Inflation fears and already significant commitments to public spending argue for constraint. Whether that sentiment survives the expedience of election year is yet to be seen.

Similar fiscal conservatism is likely to characterise Opposition spokesperson, Bill English's view of the world. A heavy programme of established public expenditure does not allow him a great deal of flexibility without taking the election-losing step of constraining 'working for families' or resiling from Kiwisaver.

First round of consultation on Police Act completed

An analysis of public views on the future of policing in New Zealand has been published as part of the review of the 1958 Police Act.

The analysis, Perspectives on Policing, summarises 220 public submissions received at the end of the first phase of consultation on the review of the Act.

Key themes to emerge include:

• Support for new policing legislation to reflect state sector-wide employment principles, while recognising unique aspects of the Police role.
• Split views on whether officers can or can't take industrial action.
• Mixed views on whether policing legislation might include new ways of contributing to Police's funding base.
• Support for the Police Commissioner to take employment action against staff, despite criminal charges being contemplated.
• Clear support for keeping the name 'New Zealand Police', as opposed to Police Force or Police Service.

Perspectives on Policing is available for download on www.policeact.govt.nz.

Bills Introduced

Armed Forces Law Reform Bill
Government Bill: Hon Phil Goff

The military justice system is to be significantly overhauled for the first time in 25 years. This Bill reforms the Armed Forces Discipline Act 1971, the Courts Martial Appeals Act 1953, and the Defence Act 1990 (as well as effecting a number of consequential amendments). It will establish a new permanent Court Martial of NZ (to replace the current ad-hoc courts-martial), as well as a new Summary Appeal Court.

Fisheries Act 1996 Amendment Bill
Government Bill: Hon Jim Anderton

The Bill sets out to ensure that the Fisheries Act 1996 enables decision makers to ensure sustainability of fisheries resources and address the adverse effects of fishing on the aquatic environment in situations where information is uncertain or limited.

Before Select Committee

Births, Deaths, Marriages, and Relationships Registration Amendment Bill
Referred to Government Administration Committee for report by 31 August 2007 (submissions not called for).

Statutes Amendment Bill
The wash-up bill of non-contentious technical amendments, the Bill was referred to Government Administration Committee for report by 31 August 2007 (submissions not called for).

Te Roroa Claims Settlement Bill
Referred to Maori Affairs Committee for report by 1 June 2007.

Open for submissions

Submissions Closed

Bills Reported Back

Student Loan Scheme Amendment Bill (No 2)

Supplementary Order Papers

Customs and Excise Amendment Bill (No 2)
Hon Nanaia Mahuta

This SOP makes two amendments: the new section 32C which authorises Customs officers to require persons to remain in designated places for public health or law enforcement purposes; and the second amendment is consequential on clause 9A, which changes the dates on which annual orders indexing the rates of duty on alcoholic beverages and tobacco products are required to commence.

Injury Prevention, Rehabilitation, and Compensation Amendment Bill
Hon Ruth Dyson

This SOP makes minor technical amendments to Part 1 of the Schedule of the Injury Prevention, Rehabilitation, and Compensation Amendment Bill.

Disabled Persons Employment Promotion (Repeal and Related Matters) Bill
Hon Ruth Dyson

This SOP amends the Disabled Persons Employment Promotion (Repeal and Related Matters) Bill so that clause 13 (new section 8) uses different terminology and clause 14 has been substituted with a clause that provides for consequential amendments to sections 56(1A) and 63(6) of the Employment Relations Act 2000 to replace "under-rate worker's permit" with "minimum wage exemption permit". Additionally, clause 15 provides a transitional provision for under-rate worker's permits.

Disabled Persons Employment Promotion (Repeal and Related Matters) Bill
Hon Ruth Dyson
Motion to divide Bill

Crimes (Abolition of Force as a Justification for Child Discipline) Amendment Bill [proposed to be amended to Crimes (Substituted Section 59) Amendment Bill]
Chester Borrows

The SOP seeks to amend section 59 of the Crimes Act 1961 to prevent serious assaults by parents and guardians being legally justifiable.

Judicial Retirement Age Bill
Hon Rick Barker

The SOP omits clause 3 of the Judicial Retirement Age Bill. Clause 3 will no longer be necessary because the Bill will be divided into six separate Bills, each of which will apply only to the judicial office or coronial office concerned.

Judicial Retirement Age Bill
Hon Rick Barker

Proposed motion to divide Bill into six Bills.

Injury Prevention, Rehabilitation, and Compensation Amendment Bill
Hon Ruth Dyson

This SOP makes minor technical amendments to Part 1 of the Schedule of the Injury Prevention, Rehabilitation, and Compensation Amendment Bill.

Bills Passed

Customs and Excise Amendment Bill (No 2)
Injury Prevention, Rehabilitation, and Compensation Amendment Bill
Unsolicited Electronic Messages Bill

Judicial Retirement Age Bill (omnibus Bill split at committee stage into):

District Courts Amendment Bill (No 3)
Employment Relations Amendment Bill (No 2)
Judicature Amendment Bill (No2)
Te Ture Whenua Maori Amendment Bill (No 2) Maori Land Amendment Bill (No 2)
Coroners Act 1988 Amendment Bill
Coroners Act 2006 Amendment Bill

Regulations

Protected Objects Amendment Act 2006 Commencement Order 2007
State-Owned Enterprises (Kordia Group Limited) Order 2007
Minimum Wage Order 2007
Injury Prevention, Rehabilitation, and Compensation (Liability to Pay or Contribute to Cost of Treatment) Amendment Regulations 2007
Injury Prevention, Rehabilitation, and Compensation (Motor Vehicles Levies) Regulations 2007
Weathertight Homes Resolution Services Act 2006 Commencement Order 2007
Weathertight Homes Resolution Services (Fee) Regulations 2007
Weathertight Homes Resolution Services (Lower-value Ceiling) Regulations 2007
Securities Act (Rural Portfolio Capital Limited) Exemption Notice 2007
Securities Act (Huka Falls Resort Limited) Exemption Notice 2007
Securities Act (Kensington Park Properties Limited) Exemption Notice 2007

Immigration Update: The Immigration Service is set for a major overhaul later this year following Cabinet approval of a new business model based on an integrated package consisting of:

• a new Information Communications Technology system;
• people capability and improvements to support systems;
• improved facilitation measures to attract the migrants NZ needs; and
• centralisation of decision-making in NZ (as opposed to current offshore decision-making discretion).

A Bill is due to be introduced before mid 2007.

Softer regime for tax penalties: Legislation is due to be introduced in May to reduce the amount of penalties faced by people who have a tax shortfall as long as they tell the IRD about it before they learn they are to be audited. The new regime is designed to encourage compliance with the law.

Tax agreement with Dutch Antilles: New Zealand has signed a tax information exchange agreement this week with the Netherlands Antilles. The agreement will come into force in New Zealand once an Order in Council is made by the Governor-General.

The Commerce committee commenced consideration of the Major Events Management Bill (regarding the regulation of advertising around major sporting events). The committee also agreed to conduct two inquiries: one into housing affordability in New Zealand and the other into the valuation methodology for state-owned enterprises.

The Finance and Expenditure committee considered Mr Cleary's petition and its inquiry into Television New Zealand.

The Government Administration committee did not meet last week, but will meet again on 14 March to continue its consideration of the Therapeutic Products and Medicines Bill.

The Local Government and Environment committee continued to hear evidence with respect to the Waste Minimisation (Solids) Bill. The report-back date on this Bill has been extended by 6 months to June.

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