The Nation: Lisa Owen interviews David Parker

Press Release – The Nation

Lisa Owen: In five days time, our trade minister, David Parker, will be in Chile to sign up to a revised version of the Trans-Pacific Partnership deal one of 11 countries to do so. Mr Parker once marched against this deal but says its now …On Newshub Nation: Lisa Owen interviews Trade Minister and Attorney General
David Parker

Lisa Owen: In five days’ time, our trade minister, David Parker, will be in Chile to sign up to a revised version of the Trans-Pacific Partnership deal – one of 11 countries to do so. Mr Parker once marched against this deal but says it’s now a new and improved version. It’s certainly got a longer name – the Comprehensive and Progressive Agreement for Trans-Pacific Partnership. David Parker joins me now. Minister, from this point onwards, we’re just going to refer to it as the agreement.

David Parker: The CPTPP.

Yes, exactly. Scale of 1 to 10 – 10 being out of this galaxy, deal of the century – what grade do you give it?

Probably a 7 to good, improved access into Japan, where beef exports have been dropping; they’ve dropped by 38 per cent recently because of Australian competition with lower tariffs. That’ll be fixed. Not an especially good deal for dairy but better than nothing, and relatively more important than it was before the attacks on the World Trade Organization architecture that are happening because of some other countries who seem to want to blow the system up.

Some people would listen to that and say you’ve given it a seven, which is kind of okay; it’s sort of lukewarm. Why are you signing up to it if it’s only a seven?

Because the alternative for New Zealand would be worse. I think most New Zealanders know that we’re never going to produce computers or cars or cell phones and medicines, so we’ve got to sell things to the rest of the world in order to buy the things we need to have a good standard of living. So I think it will benefit people throughout society, whether the freezing worker or the farm owner or the computer programmer or the tech entrepreneur.

So it’s pragmatism, Minister? Pragmatism is suggesting that you should sign this.

I think it will be good overall for the country. I don’t think it’s the best trade agreement; that’s why I gave it a seven. Our best trade agreement is with Australia, which you give a 10 out of 10, and in comparison to our free trade agreement in CER with Australia, it’s not nearly as good, but it is important, particularly into Japan, and that’s why we’re signing up.

Okay. Well, the deal. The numbers are that the deal is expected to bump up GDP anything from about 0.3% to 1%. So that could be as little as just over $1 billion a year. So put it in perspective. You are planning to spend $1 billion a year on regional development. Those numbers aren’t that flash, some people would argue.

I’d say a couple of things about that. One is that does actually translate to thousands of extra jobs in the economy that wouldn’t otherwise be there. It’s obvious that if we have no tariffs and we face tariffs into other countries, if they drop their tariffs under this agreement and we don’t drop ours – because ours are already essentially at 0 – that there are economic benefits into New Zealand. In respect of the total of those tariff benefits, the tariff reductions for New Zealand in this are close to twice what they were in the tariff reductions under the Chinese free trade agreement, so the benefits of that, I think, are known to virtually every New Zealander, and I think the benefits from this will be substantial as well.

Okay, so you have managed to suspend 22 of the most controversial clauses, right? But just suspend them, not ditch them altogether. So what is to stop a future government, in conjunction with those other countries, reinstating those clauses? What’s to stop that happening?

Well, in theory, and this isn’t in practice, but in theory, any one of the 11 countries in the new CPTPP can block them being reintroduced. In reality, it’s a negotiation. I think it’s an absolute certainty that all of those clauses would never come back.

You can’t know that, though. That’s the problem, isn’t it? You can’t know that. Let’s work through—

I could give you 99% certainty.

That’s not 100% certainty, though, Minister.

No, it’s not, but it’s 99. That’s not bad.

And that’s the issue, because if America chooses to get back in on this deal, it would want those 22 clauses and then some, probably, put back into that agreement.

They might want to ditch other clauses completely that we want to get rid of, like the ISDS clauses, which we sort of succeeded halfway in getting rid of for the benefit of New Zealand in this agreement, not completely. Now, America is against ISDS clauses, so that could be an outcome too.

Yeah, and we’re going to talk about that in a little bit, but the thing is if America wants to get back in on this deal and it says it wants those clauses, it wants life breathed back into them, is a future government—? You can’t guarantee a future government or even your government is going to have the courage to resist that powerful country and the lure of a deal with the US.

In a democracy, you can never buy into future government, and they could always do something different, so I don’t think I should be blamed for that. But I’ll give you a real example. One of the things that we’ve improved in this version is that we’ve cut out the extension to what’s called data-exclusivity for new drugs called biologics. What that means, in effect, is that Pharmac, who buys drugs on behalf of the New Zealand public, won’t face extended periods where they’re tied to a patented drug, and they can go to generic so we can afford more medicines in New Zealand. I think it’s very, very unlikely that any of the other countries in that agreement would agree to America reversing that change.

Okay. Well, let’s look at what the five bottom lines were that you laid out that Labour said if you didn’t get those five bottom lines, you didn’t want a bar of this deal. You talked about Pharmac there. You admit that it was the National Party that took care of Pharmac, actually. You said the Pharmac model’s been well-protected by the prior government in their negotiations, so that’s credit to them.

That’s true. In terms of the Pharmac model, that’s correct. In respect of those additional costs, we’ve protected that in this new version.

Upholding the Treaty of Waitangi – it’s exactly the same text, is it not, as the deal that National was signing up for, word for word, the clause about protecting the Treaty?

It’s the same one that’s in all of our trade agreements, and that’s probably the best—

So it’s no different. Nothing’s changed.

Correct.

Okay. So, meaningful gains in tariff reductions and market access – America’s not in the deal and it’s of less value than it was, so did you meet that criteria, you think?

Well, yes, we did, and we actually had attempts right throughout to prune us back on the market access that we had into both Japan and Canada, but we managed to parry those attempts. As I said, it’s a 7 out of 10 agreement in respect of that, but it’s still meaningful gains.

You did restrict foreign home ownership of our houses, but number five of your bottom lines—

No, let’s just talk about that, because I think that’s the most significant change, because we were told by the—

But you didn’t say, “If I get one of these, I’ll sign up.” You said, “If I got five of these – five.”

We’ve got four-and-a-half out of five, but don’t gloss over—

That’s not five. That’s not five, Mr Parker.

Don’t gloss over the most important one, please, Lisa. It is a matter of personal concern to me and, I think, most New Zealanders that future governments should have the right to control who buys our houses. The last government said we’d either have to throw away free trade agreements or throw away our right to control who buys our homes. We found a route through that, and I think that most New Zealanders are persuaded that that’s a very, very important thing.

Yes, and a lot of people would say well done to you, but you still did not get to five out of five, because the number five of your bottom line was the investor state dispute clause. You said it had to go; you didn’t want companies having the ability to sue New Zealand. But the clause is still in there, so how, in good faith, can you sign on to something that you said five bottom lines?

Actually, our bottom line, if you read it, said that we wanted to protect the right to regulate it. It actually didn’t name ISDS clauses, but I’m happy to concede that we promised we’d try and get rid of them. We’ve protected the right to regulate across environment, public health, public hospitals, public education systems, right to fund SOEs, climate change, tobacco plain packaging – you name it, we’ve got the right to do that. We’ve narrowed the effect of ISDS clauses in a number of ways. We’ve excluded investment contracts. Someone builds Waterview Tunnel or a multinational – they used to be able to sue the government. They now no longer can. They’ve got to just sue it in New Zealand courts. It no longer applies to investment screening.

So you’ve narrowed the scope. You’ve absolutely narrowed the scope, but you haven’t got rid of it.

Please let me finish the explanation. We’ve narrowed the effectiveness of it by more than 80 per cent, because it only applies to foreign direct investment into New Zealand, and more that 80 per cent of the foreign direct investment into New Zealand is carved out from these clauses, with side leaders. We are left with a residue. We wanted to get rid of the residue.

And you didn’t, but you are still going to sign up.

That’s true. But you know, we got four and a half out of five. That’s 90 per cent. I’ll tell you what, that’s damn sight better than I got in school cert.

Okay, so if we accept that you met all the benchmarks, and your critics would say you did not, they wouldn’t give you four and a half out of five. They’ll probably give you two.

Oh, you’ve got to be joking. No, no, no. That’s absolutely clear that we’ve met four and a half out of five.

Okay, still not five. And you said you were after five. So these carve-outs, with the carve-out with Australia, which means they can’t sue us, you’re working on other suspensions, which you’ve talked about. How many and with what countries?

I can’t say that, for reasons of agreement with those other countries.

And here’s the thing with that, though. Because you criticised the other government for doing this deal in the dark, and in fact, Andrew Little – I’m quoting him here – “Kiwis are in the dark about which of their sovereign rights are being gambled away.” How is what you are doing behind closed doors different?

Well, we’ve disclosed the text of the whole agreement. We have had public meetings up and down the country before the agreement was signed. We’ve had a debate in parliament before we signed.

But no debate on these suspension clauses that you’re discussing with other countries.

They’re identical to the form which we have disclosed in respect of Australia, which accounts for 80 per cent. These are all additional to that, but they’re the same in principle. That will become clear next week when it’s signed, which is not the date when it comes into effect. So between that date and the date it comes into effect, that will also be out there transparently.

Okay, before we move on, your partners in government, the Greens, believe in essence that this deal is a dog. So who is ill-informed, you or them?

Them.

Your partners in government are ill-informed, the Greens?

They’re wrong on this, yes.

Okay. Have you told them?

Yes. They know my opinion, just as I know theirs. They disagree, but it’s a democracy. We’re free to disagree.

So are you comfortable having to rely on National then to get this business through?

The other thing here is that I don’t actually expect everyone in New Zealand to agree with me just because I’m in government. I do try to deal with the individual arguments. You know, people who say we’ve lost the right to regulate in respect of climate change. Well, I think they’re wrong, and I’m happy to take them through the individual clauses in the agreement that protect our rights on that. But at the end of it, there will still be some people who are never convinced. And that doesn’t make them bad people; that just means that they’ve got a different opinion on that, and we’re free to disagree.

Well, let’s move on to a totally different topic. This week, Labour has signalled it’s going to take a stronger stance around protecting people’s human rights. You want to give the senior courts the power to force parliament to review laws if they conflict with our human rights. So what court should have that power? What are you classifying as senior courts here?

Well, that’s being worked through by Andrew Little, in terms of the change of legislation. But the senior courts are essentially what we mean as High Court and above. And we’ve got a problem in New Zealand that it’s a little bit easy in our system, which only has one house of parliament, to somewhat rashly override the Bill of Rights. At present we haven’t got a route back to fix it.

No, only a voluntary route. Because if the court were to tell or make a declaration, which it has, that the law is inconsistent, parliament could, of its own bat, revisit that.

It could, but it sometimes gets tied up in politics. And we think it would be a good idea – this was recommended by the Constitutional Review Committee – to actually create a process within parliament to look at it, to take breath and say, “Hey, look, the courts have told us we’ve got this a bit wrong.” But it you’re going to do that, it’s important that you preserve the sovereignty of Parliament. And so Parliament would, yes, have to look at it again, but it could either affirm, amend or change the law that was criticised by the courts.

Are you going to adopt one of Geoffrey Palmer’s recommendations which was that if you want to affirm that law, you’ve got to get a 75 vote, majority, to keep a law that is inconsistent with the Bill of Rights?

No. No, I don’t think so, no.

So will they just be required to look at it and nothing more? Is it going far enough?

You know, some of the problems you see oversees, like America not being able to change their gun laws or their campaign financing laws, or Australia being able to fix their problems with the ancient citizenship of some of the parents of the MPs, meaning they’ve got to resign, we don’t have those problems in New Zealand. Our system is actually working very, very well in New Zealand at the moment. But it’s a bit easy to overrule the Bill of Rights, so this is intended to fix that. I didn’t know that this issue was going to be raised, but I’m happy to talk further about it.

So given this is a priority for your government, why is Crown law seemingly throwing its weight and considerable resources into fighting human rights cases through the courts? Now, an example of that is this battle of prisoner’s right, or not, to vote. It’s in the Supreme Court, this coming week. Every other court has already said that a blanket ban on prisoners voting is inconsistent with Bill of Rights obligations. So why keep going and spending all that money and fighting up to that level?

Well, one, in the scheme of things, it’s actually not a lot of money. We’re just about all the way through the courts system. And the issue at large in the court is whether the court already has the jurisdiction to do of whether it has to be given by parliament. And that’s an important point of principle. Now, that’s a matter before the courts, so I don’t really want to go into that too much today, because I’ll be seen to be criticising the courts in the middle of the process.

Let me put it another way, then, Minister. Are you going to give Crown law any particular instruction around pursuing cases like that?

Well, I believe in the rule of law.

So take it right to the Supreme Court?

Where there’s an important point of principle, yes. That’s what the Supreme Court’s for, and I think they would agree to that, that that’s what they’re there for too.

But do you think that puts an overly large burden on the other side of the argument, the other people pursuing the other side of the argument, to fund their case to that level?

No, I don’t. No. If you think that’s the problem, you should do away with having Courts of Appeal or the Supreme Court. So, no, I don’t think that’s an issue.

Ok. What do you think, should prisoners get the right to vote?

Well, I voted against the legislation.

Yeah. So?

I mean, the reason I voted against that was that it’s arbitrary that if someone’s in prison for six months – if they’re there during the period when the election’s held – they can’t vote; it they’re there in the six months before then, they can. So despite the fact that they’ve not done anything differently to the other person, they’re being treated differently, which is why the courts, and indeed the then Attorney General, found that that was inconsistent with the Bill of Rights. But actually that’s less important than the wider point that is where parliament perhaps has a rush of blood to the head, as I think Parliament did on medication when the National party pushed that through. Actually, Simon Bridges had that wrong in your last interview.

Yes.

Sometimes it’s worth parliament, after hearing from the courts, say, “Well, look, you know, we should look at this again.” So that’s all this is saying.

This week Judge Becroft, the Children’s Commissioner, suggested that 16-year-olds should get to vote. What do you think?

Well, that’s not my portfolio responsibility, so I won’t express an opinion on that. It wasn’t our policy in the last election.

Okay. You will probably be aware that there’s a current case in the High Court where a woman is trying to get her New Zealand passport back under the 1992 Passports Act. She’s not allowed to be in court; she’s not even allowed a lawyer there, and no members of the public or the media can be there to see and report what’s going on. Does that seem consistent with our Bill of Rights Act?

Well, again I won’t comment on the detail of that case. And I’ve probably been briefed on it.

But in principle? If not that case, in principle? Shouldn’t we have transparency and accountability?

It’s one of the issues that’s left hanging by the review of the Security Agencies Law a couple of years ago, that the Law Commission is looking into and reporting back to parliament. Because you’re right, you’ve got to get that balance right. On the one hand, you’ve got duties to some of our security agencies that we get this information from overseas; on the other hand, you have to be fair in the process.

Have you got the balance right, currently?

I think the Law Commission will come back with suggested amendments. No, I don’t think the balance is quite right at the moment.

Thanks for joining me this morning, Minister.
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