Tuesday, 6 September 2016

TUESDAY, 6 SEPTEMBER 2016

TUESDAY, 6 SEPTEMBER 2016

Mr Speaker took the Chair at 2 p.m.

Prayers.

Oral Questions

Questions to Ministers

Housing—Affordability and Availability

1. ANDREW LITTLE (Leader of the Opposition) to the Prime Minister: Does he stand by his statement that “we are seeing a record number of houses being built”, given the current rate of dwelling consents per 1,000 New Zealanders is less than the average under the previous Labour Government, and less than half the record level?

Rt Hon JOHN KEY (Prime Minister): It is relieving to see the member today with his clothes on. And the answer to that question is, yes.

Grant Robertson: Don’t be jealous, John.

Rt Hon JOHN KEY: I know! I was in awe—shock and awe.

Mr SPEAKER: Order! Now, we will get back to questions for oral answer.

Rt Hon JOHN KEY: According to the latest Building Activity Survey from Statistics New Zealand, the amount of residential building work in the 3 months to July was the highest since the series began back in the 1980s. That is up 6 percent on the previous record level, set in March this year. It is an increase of 50 percent since 2013 and an increase of over 90 percent since the start of 2012. As I said previously, building consents have been running at the highest level for over 11 years, and we are looking for them to increase further.

Andrew Little: Will he take responsibility for fewer than 10,000 houses a year being built in Auckland when 13,000 are needed?

Rt Hon JOHN KEY: There are a number of reasons why house numbers have not met the level that is required. Most of those reasons have been around the metropolitan urban limit restrictions, but also the global financial crisis had a big impact on developers not being in the position to be able to fulfil building plans. The good news is that we are narrowing that gap rapidly, and, under very low interest rates and a strong economy, more and more New Zealanders are buying a home.

Andrew Little: Are enough affordable houses being built in New Zealand today; if not, what excuse does he have after 8 long years?

Rt Hon JOHN KEY: There are a range of houses being built across New Zealand, at a range of different prices. One looks at the KiwiSaver HomeStart programme—around the regions, that is being used by a great many New Zealanders. We think it will benefit over 90,000. But even as of the recent data today, over 30 percent of all sales that took place in Auckland in the last 12 months were at $650,000 or less.

Andrew Little: In light of information out today showing that the average house price in Auckland is now over $1 million, just how serious is he about getting more New Zealanders into an affordable home?

Rt Hon JOHN KEY: The honourable member answered that himself when he noted the big increase in the number of properties being built under the National-led Government. Yes, it is less than what is probably required, but we are getting very close to getting that number delivered each year. If one looks at the Government’s comprehensive plan, it is everything from releasing public land to extra people being trained in the sector. We are in the biggest building boom we have seen, and this is the largest number of people ever employed in the construction sector. There are more houses to be built, but this Government is helping to assist those houses to be built.

Andrew Little: What excuses does he make to Aucklander JP van der Westhuizen, who says: “My wife and I have got good jobs and earn decent money, especially for our age. … It’s a vicious cycle, rent is so high that you can’t save. The whole DIY Kiwi dream is becoming more and more unachievable. It’s pretty ridiculous.”?

Rt Hon JOHN KEY: That would not be borne out by the number of people who are using KiwiSaver HomeStart, which is for first-home buyers. Secondly, what is happening is that, of course, you do have house prices going up in both Auckland and generally around New Zealand, but that is fuelled by extremely low interest rates and also a very buoyant economy. We have one of the fastest-growing economies in the developed world, the second-highest employment rate in the world, and one of the lowest unemployment rates.

Andrew Little: Does he accept that the reason 10,000 Kiwi kids under 15 are now homeless is that he and his Government have failed to fix the housing crisis?

Rt Hon JOHN KEY: I do not accept the premise of the member’s question.

Andrew Little: I seek leave to table a table that shows the result of the Otago University research, showing that 10,000 children under 15 are now homeless.

Mr SPEAKER: Order! Can I just understand—the source of the document is an Otago University research document?

Andrew Little: That is correct.

Mr SPEAKER: And has it been publicly released by the university?

Andrew Little: I am not aware of how it has been published, because I have got only a hard copy at this point. [Interruption]

Mr SPEAKER: Order! I would advise members in the future that they will be asked that question and I will expect them to be ready. But on the basis that it has not been checked, leave has been sought to table that particular report. Is there any objection? There is none. It can be tabled.

Document, by leave, laid on the Table of the House.

Andrew Little: Will any of the excuses he has offered today help a single family buy their first home or help even one homeless child into a warm, safe home tonight?

Rt Hon JOHN KEY: Well, the number of houses being built both in Auckland and around New Zealand has been dramatically increasing in the time since I have been Prime Minister, from 10 a day to well over 40 a day. Just today the Government announced that there will be an additional $24 million going to support community housing providers. There was $50 million allocated in the Budget for emergency support. This is the Government that raised benefits for the first time in 43 years. This is the Government that also allocates over $2 billion a year to accommodation supplements and the like. I think the argument saying that we are not doing anything to help less-well-off New Zealanders simply does not hold water.

Immigration—Student Fraud and Policy

2. Rt Hon WINSTON PETERS (Leader—NZ First) to the Prime Minister: Does he stand by all his statements?

Rt Hon JOHN KEY (Prime Minister): Yes.

Rt Hon Winston Peters: When he said—and I quote him—“I think New Zealand is a far better and richer country for having migration the way that we do.”, why did he ignore the widespread immigration fraud in the Indian student market, which is now reaching into hundreds and even thousands of people?

Rt Hon JOHN KEY: New Zealand is a better country for migration, and I can think of many examples. I can think of an Indian person who came to New Zealand 44 years ago, set up a business, employed 200 people, and, from time to time, made donations—forgettable or not—to political parties that they thought about. That is all as a result of migration, funnily enough, from India. [Interruption]

Mr SPEAKER: Order! The House on my right-hand side will settle.

Rt Hon Winston Peters: How sane is an immigrant who would offer $20,000 to have breakfast with him and—[Interruption]

Mr SPEAKER: Order! Again, I am asking, for a second time, for a little more respect from my right-hand corner.

Rt Hon Winston Peters: —is he aware of Operation Silver Needle by Immigration New Zealand in Mumbai in November 2014, which found that 90 percent of the applicants were not bona fide and that such organised fraud continues to tarnish our export education reputation?

Rt Hon JOHN KEY: In answer to the first part of the question, very. And in answer to the second part of the question, no.

Rt Hon Winston Peters: Why did he say that his Government is “working for all New Zealanders” when we currently have 15,000 unemployed New Zealand labourers whilst his Government approved work visas for 6,500 foreign labourers?

Rt Hon JOHN KEY: Most of that is because of mismatch of labour, so it is required in one part of the country and people are located in the other, or—as I said yesterday on Morning Report—people have a variety of reasons, from being unable to pass a drugs test, or a variety of other factors. So of course Work and Income does everything it can to get people in work, and one of the major changes this Government made was to re-face, if you like, the way Work and Income operates to get rid of the old dole and to replace it with job seeker support, and that has been highly effective.

Rt Hon Winston Peters: How is his Government working for all New Zealanders when his Government has approved dog handlers and dance teachers and over 10,000 chefs—more than the restaurants we have got in this country—as skilled migrants whilst we have 70,000 New Zealand youth not in employment, education, or training?

Rt Hon JOHN KEY: There is nothing wrong with bringing in chefs, particularly if they are Indian. For some people, it can be very lucrative.

Support for Families—Tax Redistribution and Other Support

3. Dr SHANE RETI (National—Whangarei) to the Minister of Finance: How is redistribution through the income tax and income support systems helping support New Zealand families?

Hon STEVEN JOYCE (Acting Minister of Finance): Tax and income support is a significant source of income redistribution in the economy, more so following tax changes made in 2010. Treasury has updated its estimates for tax collection for the 2016-17 year. It now expects households earning over $140,000—that is, the top 20 percent of household incomes—will pay 55 percent of all income tax. The top 10 percent of households are expected to pay 37.2 percent of income tax this year, which is up from 35.5 percent when this Government took office in 2008. Families in lower-income households are paying a smaller proportion of tax. The 20 percent of households with the lowest income are expected to pay just 2.8 percent of income tax this year, compared with 3.4 percent in 2008.

Dr Shane Reti: What other evidence has he seen showing the tax and income support systems are more progressive today than in 2008?

Hon STEVEN JOYCE: Treasury has also undertaken an analysis of the net tax paid by households—that is income tax paid, less than the amount received in benefits, superannuation, and Working for Families. This shows the 30 percent of households with the lowest incomes will pay $1.7 billion of income tax, but this is more than offset by the $10.6 billion they are expected to receive in income support. Treasury estimates that 42 percent of households will pay no net income tax—that is, they will pay less in tax than they receive in welfare benefits, Working for Families, New Zealand superannuation, or accommodation subsidies. This compares with 39 percent in 2007-08, when this Government took office. That suggests tax and income support systems are more progressive today than they were in 2008.

David Seymour: Has the Minister seen any reports of the National Party campaigning to make the tax and transfer system—

Mr SPEAKER: Order! No, that question is not in order. There is no ministerial responsibility at all for a political party.

Dr Shane Reti: What steps has the Government taken to help New Zealand families get ahead?

Hon STEVEN JOYCE: The economy remains front and centre of the Government’s busy programme, which, of course, includes the Business Growth Agenda, which is helping to create more jobs and higher incomes for New Zealanders. We are seeing results. New Zealand currently has the second-highest employment rate in the developed world—that is the second-highest. Of every 100 people aged 16 and over, 66 are in work. That compares with 61 in Australia and Canada, 60 in the UK and the US, and 56 across the OECD as a whole. This is, in part, due to the 250,000 jobs that have been added to the economy over the last 3 years.

Dr Shane Reti: What steps has the Government taken to support lower-income families?

Hon STEVEN JOYCE: On 1 April this year the Government increased benefits for families with children by $25 a week. It is the first real increase since 1972. We also increased Working for Families payments to very low-income working families by $24.50 a week and to other working families by up to $12.50 a week, and we increased childcare assistance for low-income working families. On top of this, the Government has introduced free GP visits and prescriptions for under-13s, breakfasts in all schools that want it, social workers in all low-decile primary schools, the Youth Service for young teen beneficiaries, insulation in every State house that can be insulated, rheumatic fever prevention, Whānau Ora, and now the establishment of a new ministry to support vulnerable children.

Grant Robertson: Which of the following achievements of his Government is helping to support New Zealand families the most: homelessness being the worst in living memory, according to the Salvation Army; 10 percent of New Zealanders owning 60 percent of the wealth, according to Statistics New Zealand, up from 55 percent; or his own admission that incomes are dropping despite GDP growth?

Hon STEVEN JOYCE: I would contest at least two of the member’s statements there, if not all three. But in terms of the things this Government is most proud of, it is creating the climate, the job opportunities, and investment in job growth throughout New Zealand that is lifting employment—something like 325,000 jobs now since the global financial crisis—which is bringing Kiwis into work, which is raising their wages ahead of inflation, which means that more and more New Zealanders want to return home from other parts of the world, where they fled during the previous Government.

Grant Robertson: In light of his answers to the primary and first supplementary questions, expressing confidence in the progressivity of the tax system, is he ruling out tax cuts being proposed by his Government before the next election?

Hon STEVEN JOYCE: No, I am not ruling anything out today, but I can tell the member that if the Government was in a position to improve the position of income taxes for New Zealanders, we would be looking to do it for all hard-working New Zealanders.

State and Social Housing—Homelessness and Availability

4. PHIL TWYFORD (Labour—Te Atatū) to the Minister for Social Housing: Does she stand by her statement in relation to homelessness that “we’ve got a demand and supply problem which we’ve been tackling for the last two years”?

Hon PAULA BENNETT (Minister for Social Housing): Yes.

Phil Twyford: How well is that going when the average Auckland house price has now reached $1 million, average Auckland rents have gone up $3,500 in the last 2 years, and social agencies say that they have never seen homelessness this bad?

Hon PAULA BENNETT: Well, what we have got is a comprehensive work plan where we saw more than $40 million of new money going into emergency housing providers alone; another $3 million that we have made announcements on in respect of the Housing First policy, which will be rolled out in west, central, and south Auckland; and another $9 million that is going into Better Housing Outcomes, where we are seeing tenants who are in both private rentals and Housing New Zealand, in particular, who are being evicted—and so we are trying to get in earlier to ensure that they are not. There is the Housing New Zealand supply pipeline, where we see more Housing New Zealand homes in Auckland than we have had in the last 9 years—we have seen the number in Auckland increase. We are also seeing the announcement, like today, where we are seeing that community housing provider also increasing the supply that it has got.

Phil Twyford: Does she agree with the Salvation Army, which says that the Government has deliberately left thousands of State houses empty to justify selling them off?

Hon PAULA BENNETT: No, I do not—not at all. What we are seeing is a massive rebuild programme that is going on, not just in Auckland but throughout the country, where you can see examples of three Housing New Zealand houses being knocked down and then 13 being built on that same site. So we are seeing more houses being built. We are also doing a complete analysis of the pending sales throughout New Zealand, alongside the housing register that is going up in different places. So anywhere with over 100 applicants on the waiting list, or an increase of up to 40 to 50 percent, then we are looking at it to make sure that we have got the right synergies there as far as getting houses to the people who need them.

Dr Parmjeet Parmar: How will the $24.4 million in new funding for community housing providers that she announced today help to increase the supply of social housing in Auckland?

Hon PAULA BENNETT: Growing the role of community providers is a vital part of that comprehensive plan for social housing in particular. We have had the Social Housing Fund, which was very successful; the shoe fund; and today we announced another $24.4 million on top of the $120 million that was in this year’s Budget. That means that we will be able to give a grant of up to 50 percent for new builds and, also, an additional 50 percent on top of the market rent for those who might be leasing. It will make a huge difference in getting some of those deals over the line.

Phil Twyford: Why is she wasting time quibbling with her own Government’s official definition of homelessness, which was developed by the Ministry of Social Development, Housing New Zealand, and Statistics New Zealand and has now been adopted internationally—or are they all wrong and only she is right?

Hon PAULA BENNETT: To be frank, I do not spend a lot of time on that. Every day I am focused on getting more beds available for the New Zealanders who need them. That has been the key focus of this Government. We can see that supply coming through. We can see an increase in the number of emergency housing beds. In fact, right now we have got a deal out there in purchasing a motel for more emergency beds in Auckland as well as another whole lot of initiatives, including looking at community group houses. We are actually making sure that we are going to be looking at putting others into that as well.

Phil Twyford: Does she believe that 69-year-old Lynette Haines of Tauranga, who is renting a temporary cabin in a motor camp because she cannot find any affordable housing, should be regarded as homeless, or does she think that you are homeless only if people are stepping over you in the street?

Hon PAULA BENNETT: I do not know those circumstances for that particular woman and, as such, where it would be. It is irrelevant. What she actually needs is a permanent home where she can get that kind of access. That is what I am concentrating on and that is what we are making progress on, on this side.

Road Safety—Safer Roads and Roadsides

5. BARBARA KURIGER (National—Taranaki - King Country) to the Minister of Transport: What update can he provide on the Government’s recently announced $600 million Safer Roads and Roadsides Programme?

Hon SIMON BRIDGES (Minister of Transport): Alongside the local member of Parliament Barbara Kuriger, it was my pleasure recently to open the first of the Government’s $600 million of Safer Roads and Roadsides projects. Changes to the high-risk section of State Highway 37 in Waitomo include side barriers to stop drivers running off the road, improved signage and road markings, and sections of the highway have been widened so that drivers who do lose control on corners have more time to recover. These improvements will make it a road more forgiving of human error, helping to reduce the amount of crashes in the first place and limiting the severity of the impact if they do occur.

Barbara Kuriger: What other projects can road users expect to see the Government deliver in Taranaki - King Country as part of the Government’s $600 million Safer Roads and Roadsides programme?

Hon SIMON BRIDGES: All up, the Government is investing $23 million in six safety projects on rural State Highways 3, 23, and 37 in the Taranaki - King Country area in an effort to reduce serious injury and fatal accidents. The range of improvements to some of the country’s most dangerous stretches of rural road will be a mix of roadside and median barriers, widening centre lines, road widening, improved signage, road markings, and rumble strips. All of these actions will reduce the risk of head-on and run-off-road crashes in Taranaki - King Country and are an important part of the Government’s significant step up in road safety investment to reduce death and serious-injury crashes on New Zealand’s rural roads.

Homelessness—Government Response

6. JAMES SHAW (Co-Leader—Green) to the Prime Minister: Does he stand by all of his Government’s policies?

Rt Hon JOHN KEY (Prime Minister): Yes.

James Shaw: Does he still feel that his Government’s policies are giving all New Zealanders a brighter future when even his own Minister for Social Housing yesterday admitted that homelessness had got worse on its watch?

Rt Hon JOHN KEY: For the most part, yes.

James Shaw: What proportion of the 42,000 people living in severe housing deprivation will be housed as a result of the $24.4 million package announced today?

Rt Hon JOHN KEY: The member would need to direct that question to the Minister for Social Housing.

James Shaw: Is he honestly saying that on the day that the Government announced $24.4 million worth of expenditure, he has no idea what the specific outcomes of that expenditure are going to be?

Rt Hon JOHN KEY: What I am saying is that I do not wing things, because if I do the member will put in a breach of privilege claim, and if he wants an answer to a detailed question like that he should direct it to the appropriate Minister.

James Shaw: Does he stand by all of his Government’s policies, when sociologist Kay Saville-Smith said at the homelessness inquiry yesterday that in the 30 years that she has worked in homelessness in New Zealand she has “never seen a situation like this.”?

Rt Hon JOHN KEY: I think she will take confidence, then, in the announcement made by Minister today.

James Shaw: When does his Government believe that the number of people living on the streets and in cars and in garages will actually start to decrease?

Rt Hon JOHN KEY: I cannot give the member an exact date, but with the work programme I have seen from the Minister I am confident that will be the case.

James Shaw: Just to clarify, is he really saying that he cannot tell New Zealanders when his so-called comprehensive plan on housing will actually start to work?

Rt Hon JOHN KEY: It has already started to work, and that is witnessed by the fact that we are in the biggest construction boom that we have seen.

Police—Radio Networks

7. RON MARK (Deputy Leader—NZ First) to the Minister of Police: Does she stand by all her statements?

Hon JUDITH COLLINS (Minister of Police): Yes, and I particularly stand by my statement that the New Zealand Police are the finest in the world, and I am so proud of them.

Ron Mark: Does she stand by her statement in 2010 that her Government “has continued to invest in staff and equipment that reflect international best practice”, with reference to the proposed roll-out of new digital radios?

Hon JUDITH COLLINS: It was an awfully long time ago, but I am sure I do.

Ron Mark: Why, then, if the police secure digital radio network reflects “best practice”, are regions outside of the main metropolitan centres still relying on the unencrypted analogue radio network that is being monitored and listened into by criminals?

Hon JUDITH COLLINS: There have been a few developments in those 6 years. One of them is that the police now have iPhones. There is cellular network work that is going on with Vodafone to make sure that they are able to be accessed all round the country, and so there is some work going on there.

Ron Mark: In response to that answer, accepting that cellphone coverage is still not throughout rural New Zealand, why did police Minister Anne Tolley, in 2013, scrap plans to extend the secure digital radio network for police into rural and provincial New Zealand, reversing your commitment—yours, the Minister’s—in November 2010 that that would happen?

Hon JUDITH COLLINS: As much as I would like to be responsible for all the things that everyone has ever done, the fact is that I cannot be responsible for what a Minister has done, two Ministers back.

Ron Mark: On behalf of her Government, could she tell the House how front-line police in provincial New Zealand are supposed to improve burglary resolution rates and prevent crime, while criminals using cheap scanners are able to listen to their unencrypted analogue radio network, allowing them to plan and execute crimes and then make good their escapes before the police arrive?

Hon JUDITH COLLINS: I think I explained to the member that police are working with their partner Vodafone on actually dealing with this issue around cellphone coverage in rural New Zealand, and there is a plan that is operating at the moment.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. I let it go at the time, but the Minister got up and said that she is not responsible for previous Ministers. Well, as part of her administration, frankly, there have been Speakers’ rulings that she is.

Mr SPEAKER: I think when you consider the question, which was why did a particular Minister scrap a programme, etc., and considering the very nature of the primary question that was asked, the question that was then answered is in accordance with the Standing Orders.

Rt Hon Winston Peters: I raise a point of order, Mr Speaker. Could I have some clarification, then. Are you saying, then, that a statement from the Minister that she is not responsible for previous Ministers is, in fact, now a change in the order of this House?

Mr SPEAKER: No, I am not saying that at all. I am saying that when I considered the question that was asked and then the answer that was given, particularly in light of Speaker’s rulings 191/3 and 191/4, the answer that was given was completely in line with the Standing Orders.

Schools—Communities of Learning

8. STUART SMITH (National—Kaikōura) to the Minister of Education: What recent announcements has she made regarding Communities of Learning?

Hon HEKIA PARATA (Minister of Education): Tēnā koe, Mr Speaker. I was pleased to announce this morning that more than half of New Zealand schools are now working together in 148 communities of learning (COL). This means that to date, more than 1,260 schools and 18 early learning services have now formed communities of learning, supporting more than 410,000 kids. Twenty-six COLs have set their education achievement challenges, and 30 new community of learning leaders have now been appointed. In addition, almost 400 teachers have been appointed to new roles within their communities. I want to acknowledge all the schools and early learning services that have committed to work together to lift the achievement of all their students.

Stuart Smith: How do communities of learning support achievement for our young people?

Hon HEKIA PARATA: Research and the direct experience of parents show that within schools, the quality of teaching has the biggest influence on whether students will be successful. The communities of learning, resourced through the Government’s $359 million Investing in Educational Success initiative, received additional resources to enable teachers and principals to systematically share their expertise to raise all student achievement.

Saudi Arabia—Legal Advice and Auditor-General’s Inquiry

Hon DAVID PARKER (Labour): Can I seek leave, please, to hold this question over until a day when the Minister is present?

Mr SPEAKER: I will put the leave, and then the House will decide. Leave is sought to hold question No. 9 over to another day. Is there any objection? There is objection.

9. Hon DAVID PARKER (Labour) to the Minister of Foreign Affairs: Does he stand by his statements in this House regarding a $4 million payment to a Saudi Arabian businessman that “the New Zealand Government was also exposed to a legal claim for up to $30 million” and, when asked for an example of a similar payment, “I cannot point to any such example”?

Hon CHRISTOPHER FINLAYSON (Acting Minister of Foreign Affairs): Yes, when the quotes in the member’s question are considered as part of a full response that was provided.

Hon David Parker: When he said the Government was exposed to a legal claim, had he been provided any legal advice from the Ministry of Foreign Affairs and Trade (MFAT) to that effect or to the effect that a legitimate cause of action existed?

Hon CHRISTOPHER FINLAYSON: The Minister would have had access to an analysis of legal risk—because that is what we are talking about: a legal risk, not a claim that had been formulated. And when one is dealing with legal risk, one has to take into account a number of factors.

Hon David Parker: Why has the Minister resisted, for over a year, disclosing whether any relevant legal advice did in fact exist?

Hon CHRISTOPHER FINLAYSON: Ultimately, I would have thought that the fact of legal advice and its contents were matters for the Attorney-General to determine.

Hon David Parker: I raise a point of order, Mr Speaker. I took that to be a claim that legal professional privilege questions are for the Attorney-General. That is not what is at issue here. It is not what the advice was; it is whether any advice existed. I think the Minister should be asked to answer that question.

Mr SPEAKER: No, no. I think that on this occasion the Minister has answered it—clearly, not to the member’s satisfaction. But the essence of the question, as to why the Minister resisted disclosure, the Minister certainly answered that.

Hon David Parker: Did any such legal advice exist?

Hon CHRISTOPHER FINLAYSON: I have not actually seen any legal advice, because I am holding the fort, as it were. But the point is that there was an assessment by the Ministry of Foreign Affairs and Trade dealing with a range of matters, and, ultimately, it was a risk assessment that needed to be determined.

Hon David Parker: Has anyone in MFAT, including the Minister, been provided with any part of the Auditor-General’s draft report on her inquiry, over a year long, into the Saudi sheep deal?

Hon CHRISTOPHER FINLAYSON: The member in his question seems to be suggesting that the Auditor-General is taking an unduly lengthy period of time to determine this matter. The member should know, because he is an experienced member in this House, that the Auditor-General is an independent officer. She will conduct an inquiry, and then a draft report will be given to those who are affected, to enable them to comment so that natural justice questions are determined.

Hon David Parker: I raise a point of order, Mr Speaker. The essence of that question—and there were not two parts to it—was whether anyone in the ministry had been provided with a draft of the Auditor-General’s report. I do not see why the Minister cannot address that.

Mr SPEAKER: The difficulty is that the question then included a comment from the questioner that the Auditor-General had commenced this inquiry “over a year ago”—I think were the words the member used. [Interruption] Order! The Minister took the opportunity to respond to that part of the question. If I can have more concise questions, I think it helps the House deliver the answer. On this occasion I will allow the member an additional question.

Hon David Parker: I raise a point of order, Mr Speaker. The Minister has not answered the question I asked or even addressed it. The point as to the length of the report was not a question about whether it was a year long; it is an undisputed fact that it is. The question was—

Mr SPEAKER: Order! If the member would only refer to Standing Order 380, it states that supplementary questions need to be concise. The member himself put in a qualification about the length of time taken for the report. That gave the Minister the opportunity to then latch on to that part of the question. If it was not there, it would not have been able to be mentioned. To advance the cause, I have given the member an extra question. I would advise him to use it, otherwise we will move on.

Hon David Parker: Thank you, Mr Speaker. I had not heard that when I took that point of order, I am sorry. Has anyone in MFAT, including the Minister, been provided with any part of the Auditor-General’s draft report on her inquiry into the Saudi sheep deal?

Hon CHRISTOPHER FINLAYSON: I do not know. However, in order to try to be helpful to the member, I did outline the standard procedure that would be undertaken by the Auditor-General making an inquiry along these lines.

Hon David Parker: I raise a point of order, Mr Speaker. I would ask you to consider whether that is an acceptable answer, given that when Ministers are answering on behalf of other Ministers they are expected to be able to answer reasonable questions from the Opposition. I think that in the context of this controversy, that is the sort of question I would expect the Minister should have prepared for.

Mr SPEAKER: I will hear from the Hon Gerry Brownlee.

Hon Gerry Brownlee: I think that when you do consider this, as I am sure you will, you will reflect on the comment made previously by the Minister answering the question that did outline the process, which makes it abundantly clear that the Minister answering the question today could not know that answer.

Mr SPEAKER: I think the important thing is that the Minister is acting on behalf of the Minister of Foreign Affairs. He was asked whether the draft report had been presented to MFAT and/or to the Minister. The Minister, acting on behalf, took the position that was clearly his honest view: he does not know. That is an answer given. I would certainly prefer that answer to one that then led to a discussion later about whether we had had somebody misleading the House.

Question No. 7 to Minister

RICHARD PROSSER (NZ First): I raise a point of order, Mr Speaker. Without wanting to question your previous ruling on the matter of ministerial responsibility—and you reference Speaker’s rulings 191/3 and 191/4, which relate to—

Mr SPEAKER: Order! Can we just have this a bit more clearly—speak into the microphone. Perhaps if we have the Speaker’s rulings the member wants to refer to.

RICHARD PROSSER: They are Speaker’s rulings 191/3 and 191/4, which you referenced in response to the Rt Hon Winston Peters’ point of order regarding ministerial responsibility and the questioning between Ron Mark and the Minister of Police. Those points do relate to a Minister not necessarily having knowledge of what went on prior to their taking up that office, which is fair enough. But I believe that the Rt Hon Winston Peters’ point of order was to do with responsibility itself, and Speaker’s ruling 170/5 by Speaker Smith says “Just because a Minister may not have been present at the time does not relieve a Minister of being answerable for what took place.”, referencing that a Minister was asked about a decision that occurred in his portfolio before he became a Minister. I am curious—even given the circumstances, the fact that the Minister may not have had knowledge does not relieve her of that responsibility.

Mr SPEAKER: I will have a look at the points the member has raised, and, if necessary, I will come back to him, if I decide to.

Hon GERRY BROWNLEE (Leader of the House): I raise a point of order, Mr Speaker. I have been reluctant to raise it because I always worry that someone is going to say that it is just me who cannot hear things, but it does appear that the sound system in here is rather quiet today. Certainly it was earlier, when members were asking questions over there, and when you spoke just a few seconds ago it was also very, very quiet.

Mr SPEAKER: I will certainly make sure that we have a look at the sound system immediately, and I thank the member.

Building and Construction Industry, Auckland—Growth

10. KANWALJIT SINGH BAKSHI (National) to the Minister for Building and Housing: Can he confirm reports that building activity in Auckland grew by 32 percent in the last year to $6.9 billion and how does this compare historically in inflation-adjusted terms with previous highs in construction?

Hon Dr NICK SMITH (Minister for Building and Housing): Yes. Statistics New Zealand reported that annual building activity in Auckland grew by 32 percent in the year to July and is now at the highest level ever. This is the fifth straight year of growth. Residential construction activity in Auckland has been growing at 25 percent compound since 2012, and activity is now more than three times that when National came to Government. The current $6.9 billion per year compares with $3.8 billion at the last peak, back in 2004. In inflation-adjusted terms the current level of activity is 43 percent higher—43 percent higher—than the highest level in the last 25 years.

Kanwaljit Singh Bakshi: How does the current boom in building activity compare with that in 2004?

Hon Dr NICK SMITH: The first difference I noted is that it is 40 percent higher in real-value terms. The second difference in today’s building boom is much broader. It is not just residential activity; it includes record levels of commercial, industrial, and public infrastructure buildings like schools and hospitals. The third difference is that the number of dwellings built in 2004 was boosted by 5,000 apartments, many of which were as small as 30 square metres and in the next year were banned. [Interruption] The final difference, even if I use the numbers in 1974 or the numbers in 2004, is that it was only a boom for a year or two. We have had 5 straight years of growth of over 25 percent and are projected to achieve over 13,000 homes per year in the next 3 years.

Kanwaljit Singh Bakshi: What proportion of new building consents were in special housing areas in each of the last 3 years, and what impact would it have had on growth if they had not existed?

Hon Dr NICK SMITH: The number of building consents in special housing areas made up 6 percent of consents in 2013, 9 percent in 2014, and 14 percent in the last year. This growing pipeline reflects the time it takes from an area being zoned residential to getting the resource consents, getting the infrastructure built, and then getting the houses consented. The Auckland Council projects that over the next 10 years, 50 percent, or 45,000 homes, will be in those special housing areas.

Freshwater Management—Farming Practices and Water Quality

11. EUGENIE SAGE (Green) to the Minister for the Environment: Is he satisfied that the Resource Management Act 1991 is protecting rivers and groundwater from pollution; if so, why?

Hon Dr NICK SMITH (Minister for the Environment): As I said in my Lincoln University lecture last week, the Resource Management Act (RMA) is generally working well in cleaning up point-source pollution—the likes of town sewerage systems, dairy sheds, and factories—but is not working well enough in the area of dealing with diffuse pollution, such as runoff from farms, as well as in urban environments. That is why the focus of the Government’s freshwater reforms, including the national policy statement, the stock exclusion rules, the clean-up funds, and the implementing of good management practice are very much focused on that new challenge around diffuse pollution.

Eugenie Sage: Is it acceptable that the Hawke’s Bay Regional Council allows intensive feedlots like this, with no need for a resource consent and no monitoring, given the amount of pollution that rain can flush into the Tukituki River and groundwater from land uses like this, in this style of farming?

Hon Dr NICK SMITH: I would caution the member against connecting the difficulties in Havelock North directly with intensive farming, in that, actually, that area has a far lower level of intensive farming as compared with other areas—

Eugenie Sage: I raise a point of order, Mr Speaker.

Hon Dr NICK SMITH: —and, secondly, I would note the data from GNS Science—

Mr SPEAKER: Order! I apologise.

Eugenie Sage: I was not attempting to link Havelock North, and the gastric outbreak there, with this activity. I was simply asking a straight question.

Mr SPEAKER: But that is then a debatable matter. The Minister is choosing to answer it. I will allow the Minister to complete the answer.

Hon Dr NICK SMITH: I note, in respect of the serious issues around the water supply in Havelock North, that the GNS Science analysis showed that the contaminated water was only 1 year old and was likely to be surface water, in that the aquifer water in that area is 50 years old. That would suggest it is an issue of the integrity of that well, rather than something for the Green Party to try to use as an issue, without evidence, to blame on farmers in the area.

Eugenie Sage: Will the Minister’s proposed changes to the national policy statement for fresh water require regional councils to properly control intensive stock farming like those feedlots, or will he let intensive agriculture off the hook yet again?

Hon Dr NICK SMITH: We are the first Government to have a national policy statement putting requirements on regional councils. When we came to Government, there was not a single catchment anywhere in New Zealand in which there were any restrictions on intensive farming—not one. There are now at least eight where intensive farming is not allowed, and there are a further 15 catchments as a consequence of our national policy statement where they are limiting nutrients from intensive agriculture.

Eugenie Sage: Does not his Government’s failure to have strong and effective national policy under the RMA, which regulates land uses like this, allow those who benefit from these land uses to shift the costs on to the community through dirty water, dirty rivers, and dirty groundwater?

Hon Dr NICK SMITH: I would ask where that member was when she was on Environment Canterbury and it did nothing? Where was the last Labour Government, which did nothing for 9 years? I would point to the fact that at least we have a national policy statement on freshwater management, and we have a further programme with the national regulations around stock exclusion and the tighter rules around nutrients, where we are actually setting national requirements to improve the quality of our fresh water.

Eugenie Sage: I seek leave to table rule 6.3.2 from the Hawke’s Bay Regional Resource Management Plan, dated 1 October 2015, which allows the use of land as a permitted activity for feedlots and feed pads.

Mr SPEAKER: I will accept that it may be more difficult than normal for members to obtain that, and, therefore, I will put the leave and the House will decide. Leave is sought to table that particular document. Is there any objection? There is not. It can be tabled.

Document, by leave, laid on the Table of the House.

Police Resourcing—Burglaries and Workload

STUART NASH (Labour—Napier): To the Minister of Police, how many additional staff hours will it take for Police to attend every reported burglary?

Hon JUDITH COLLINS (Minister of Police): The additional staff hours required will, of course, depend on the circumstances of each reported dwelling burglary, which, of course, is what the member should have referred to.

Mr SPEAKER: Order! As Mr Brownlee pointed out earlier, we have clearly got a problem with the microphones. The question that was just asked has not been heard well. It is certainly through no fault of the Minister, I assure you; it is the level of chatter that is occurring in some parts of the Chamber that is not helping. I am going to invite the member to ask the primary question again.

12. STUART NASH (Labour—Napier) to the Minister of Police: How many additional staff hours will it take for Police to attend every reported burglary?

Mr SPEAKER: Before I call the Minister—the Rt Hon Winston Peters, I have asked for quiet and I would be grateful if you could also cooperate.

Hon JUDITH COLLINS (Minister of Police): The additional staff hours required will, of course, depend on the circumstances of each reported dwelling burglary, which, of course, is what the member should have referred to, rather than every reported burglary.

Stuart Nash: Is she really telling the House that she has instigated a major policy requiring the police to undertake significantly more work, and yet she has no idea of the implications for the hard-working police officer on the front line?

Hon JUDITH COLLINS: Well, of course not. That member may have missed the excellent press release released by the Commissioner of Police on 27 June 2016, when he noted that it was his policy that dwelling burglaries would now be considered a priority offence and not a volume crime as was acceptable under the previous Labour Government.

Stuart Nash: What does she have to say to the police officer who said to the New Zealand Herald “we’re expected to keep crime [rates] down, burglaries down [when] there’s way more people, way more crime”, considering that she has now required this officer to do more work without any more resources?

Hon JUDITH COLLINS: Given that the police commissioner is the person who set in place the policy—and, by the way, I fully agree with that decision of his—I would say to that police officer that he or she should be very pleased that they have a Minister, a Government, and a commissioner that support them, as opposed to that member, who attacks the police quite personally at almost every opportunity he has.

Stuart Nash: In response to that, when 60 percent of police say they do not have enough training, almost 60 percent say they cannot deliver on the promises they make to the public, and almost 60 percent say they have too much stress in their job, how can she load them with so much more work without an increase in police numbers?

Hon JUDITH COLLINS: Well, so many questions, and the answer is actually quite easy, really: the police are backed 100 percent by this Government. We have put on 600 extra police and there is also $400 million extra from the Budget than the police ever had under a previous Government.

Stuart Nash: When she announced this policy, was she actually aware that burglaries in our communities have increased by around 8,600, or 14 percent, over the last 12 months, to over 70,000 burglaries per year?

Hon JUDITH COLLINS: I do not know how many times I have to tell that member, but the policy decision was actually announced by the Commissioner of Police on Monday, 27 June 2016, at 4.04 p.m. I am happy to provide that member with a link so he knows where the police website is. But, having said that, I can also tell him that, on average, in the 12 policing districts there are eight dwelling burglaries a day. Police already attend 70 percent of those, on average, and, actually, I think dwelling burglaries are very important. They are a home invasion, and people should expect a response.

Stuart Nash: So if the police attend 70 percent of burglaries at the moment, they are going to have to attend another 30 percent—where are they going to find the resources to undertake this?

Hon JUDITH COLLINS: The commissioner has assured me that they can, and I am sure they will.

Urgent Debates Declined

Burglaries—Increase

Mr SPEAKER: I have received a letter from Stuart Nash seeking to debate under Standing Order 389 the increase in the number of recorded burglary victimisations by 14 percent in the last 12 months. The urgent debate is a way of holding the Government accountable for an action for which it is responsible and it must relate to a particular case of recent occurrence. The urgent debate procedure is not intended to address a continuing problem such as burglary statistics—[Interruption] Order!—which do not constitute a particular case of recent occurrence, and I refer members to Speakers’ ruling 210/5 and Speaker’s ruling 210/6. On this basis, the case raised does not meet the test for me to set aside the business of the House today. The application is, therefore, declined.

Urgency

Urgency

Hon GERRY BROWNLEE (Leader of the House): I move, That urgency be accorded the introduction and passing through all stages of the Housing Legislation Amendment Bill. This bill will allow the extension of special housing areas—

Denis O’Rourke: I raise a point of order, Mr Speaker. [Interruption]

Mr SPEAKER: Order! It is very unusual, but on this occasion a point of order has been called. I will hear it.

Denis O’Rourke: The reason I am calling a point of order is that this bill has been introduced as an omnibus bill under Standing Order 263(a) when it is not an omnibus bill.

The reason I say that is that it meets neither of the two requirements in Standing Order 263(a), and the first point is this: the topics of the two amendments are not interrelated, and the term “interrelated”, according to the dictionary, means “reciprocally or mutually related”. That means each of the amendments must demonstrate either some reciprocity within a purpose or some mutuality of a purpose, and, in fact, these two measures do not do either of those things. One deals specifically with time limits for special housing areas, and the other deals specifically with offer-back provisions when State housing land is sold, so there is neither any reciprocity in purpose nor any mutuality of purpose.

The second reason is that the other requirement is that it should implement a “single broad policy”, according to the Standing Order, and, in fact, one purpose in this bill is the development of land for sale and the other affects social housing policy and, especially, the sale of it. So one policy relates to the development of land for sale, and the other to the sale of State housing land. Neither thing is related to each other at all in any policy context.

Hon GERRY BROWNLEE: Speaking to the point of order—

Mr SPEAKER: I need no assistance, and I do thank members for offering their assistance. My office and I had a good look at this earlier today. The bill does two things in order to increase the supply and the affordability of housing. It makes amendments to the Special Housing Accords and Special Housing Areas Act 2013 and, secondly, it amends the Housing Act 1955 to clarify how the Public Works Act 1981 applies to the disposal of State housing land for use for housing purposes. Both relate to the stated purpose of increasing supply and affordability of land. It is in order and it does comply—[Interruption] Order! If I hear an interjection like that again, I will be asking for someone to leave. I am ruling that it does comply with Standing Order 263(a).

Grant Robertson: I raise a point of order, Mr Speaker.

Mr SPEAKER: Just before—I need to clarify that I have ruled quite categorically on whether this bill does comply. The member is absolutely free to raise any point of order on another matter unrelated to this. But if the member rises to his feet and continues now to argue, when I have given such a categoric ruling on this matter, that in itself will lead to disorder and I will consider very carefully whether I would be asking the member to leave.

Grant Robertson: It is a new matter regarding whether or not a bill that is introduced under Standing Order 263(a) can be considered to be “implementing a single broad policy” when there is in this bill, in Part 2, in fact, an amendment that relates largely to the Public Works Act and does require no obligation for land freed up under that to be used for housing. So there is no obligation—so the outcome of this is not even related to housing in the end. There is no obligation for that land to be used for housing, so the only way, in my view, that this can be seen as an omnibus bill is to create such a wide definition of “a single broad policy” as to be meaningless.

Hon Dr Nick Smith: Speaking to the point of order—

Mr SPEAKER: I will hear from the Hon Dr Nick Smith.

Hon Dr Nick Smith: I think the two previous speakers failed to understand the interaction between—[Interruption]

Mr SPEAKER: Order! If I hear that member interjecting on a point of order again, I will be asking him to leave the Chamber.

Hon Dr Nick Smith: Standing Order 263(a) requires that amendments deal with an interrelated topic. I would deal, for instance, very specifically with the very first special housing area in Weymouth, which is also exactly the land that is affected by the Housing Act provisions that are covered for in this bill. If we take one of the largest housing developments in Auckland, in Hobsonville—actually the largest housing development currently in Australasia—it is both a special housing area affected by this bill and it is also affected by the Housing Act. In fact, that interrelationship applies to over 30 of the special housing areas. So I think the reason for the points of order is that members have not understood the connection between special housing areas and the Housing Act 1955.

Mr SPEAKER: I have spent some time on this matter. I have given a ruling. It is not a ruling I gave lightly. Although I accept that members do not agree with what I have stated, we are moving forward. I have accepted that the bill does comply.

Hon GERRY BROWNLEE: I think in that exchange there has been ample demonstration of the particularity that might be required to support the motion. What I will say, though, is that this bill extends provisions for affordable housing that have been very successful to date, and I look forward to members of the whole House who have concerns about affordable housing offering their support for it, but I of course recognise that, given the previous exchange, there are likely to be spurious reasons why people will not support it.

Chris Hipkins: I raise a point of order, Mr Speaker. The House has set down a procedure for a Minister moving urgency to describe the nature of the urgency and why it is urgent. It does not allow for the Minister to then use that as an opportunity to pre-empt what Opposition members may say and to take a flick at other members of the House.

Mr SPEAKER: Order! No, there is certainly no need for the last part of the Minister’s statement to be given. What this is is a chance for the Minister to explain the reason for urgency. He has done that. It is no longer a debatable motion, and I will put the question.

A party vote was called for on the question, That urgency be accorded.

Ayes 63

New Zealand National 59; Māori Party 2; ACT New Zealand 1; United Future 1.

Noes 58

New Zealand Labour 32; Green Party 14; New Zealand First 12.

Motion agreed to.

Speaker’s Statements

Chamber, Lobbies, and Galleries—Clocks

Mr SPEAKER: Just before I call the Hon Dr Nick Smith, I do just want to point out to members that clocks have been added as a guidance to members. They will show the speaking time remaining. Although they are there as a guide to members, ultimately, the presiding officers will have complete discretion as to when to start a speech and when a speech concludes. I apologise for interrupting the Minister.

Bills

Housing Legislation Amendment Bill

First Reading

Hon Dr NICK SMITH (Minister for Building and Housing): I move, That the Housing Legislation Amendment Bill be now read a first time. This bill is about ensuring a smooth transition to the Auckland Unitary Plan, it is about extending the tool box of special housing areas to regional New Zealand, and it is about making the law clear in respect of Government housing programmes on publicly owned land. I do find it ironic that members of the Labour Opposition, who over the adjournment have been crying for a state of emergency over the issue of housing, are now saying no, they do not want to vote on a bill that will make a material difference.

This bill builds on the very substantive work of the Productivity Commission. In 2012 its report concluded overwhelmingly that our land-use planning system was at the core of New Zealand’s issues in respect of housing. I note that since 1990 the increase in house land costs in Auckland has gone up by 350 percent, compared with inflation of 71 percent and building costs of 78 percent. Those figures make very plain that it is the issue of land-use planning that is at the core of the challenges around housing affordability in Auckland.

There was a huge dysfunctionality between the regional council and the district and city councils in Auckland, which were not able to agree on whether Auckland should go up or out, and so the very first and important step we made as a Government was to merge Auckland into a single council and require it to develop a single plan. The process of writing a plan for the city of Auckland would normally take a period of 7 or 8 years, noting that it would be the largest plan in New Zealand’s history, covering over 500,000 properties. It is actually a tribute to Mayor Len Brown; his deputy, Penny Hulse; the independent hearings panel; and the Auckland Council that they have successfully concluded that process and that next Friday Auckland will have a new plan, one that succeeds rules that were written more than 20 years ago.

We walked a fine line in the legislation between ensuring that process occurred as quickly as possible and also ensuring people had a fair say, and we determined that, in the interim, housing could not stand still. That is why we made provision for special housing areas. There are 154 of those that have been approved, and 1,342 houses were built and completed by the end of June. There are 2,208 building consents that have been approved, and resource consents for 6,700 sections have been approved. It is interesting to note that in the 12 months there would have been no growth in the number of residential consents and new homes built were it not for the 1,100 that came through the special housing areas process. That pipeline is growing, as evidenced by the fact that in the first year it was 6 percent, in the second year it was 9 percent, and it is now 14 percent. Next year it is scheduled to be over 20 percent and for the year following 30 percent.

That brings me to the key provisions that are provided for in this bill. The first issue is around transitioning from those special housing areas over to the new Auckland Unitary Plan. Of those 154 special housing areas, there are eight for which there is doubt as to whether the plan-change process will be concluded by next Thursday. Without this bill—

Grant Robertson: When did you find out? Why has it taken you this long?

Hon Dr NICK SMITH: —those 8,000 homes would not be able to progress. Mr Robertson interjects—when did we know that? Well, actually, we still do not absolutely know, because there are independent hearings panels that are independent and are currently considering housing in those areas. Equally so, we did not know until the unitary plan process was complete, because we did not know what areas had been zoned as residential.

What this bill does is ensure that those 8,000 homes can proceed. I note that these provisions have the very strong support of the Auckland Council. I would say to members of this House: if you are genuinely concerned about housing issues in Auckland, why would we send those eight significant developments—for 8,000 homes—back to the beginning of the process?

When we brought the special housing areas process to Parliament it was very controversial—there was concern in local government. What is interesting is that I have had a number of letters from councils around the country, like Queenstown—and my meetings last week in the Bay of Plenty, and meetings in Christchurch—and also in areas such as Auckland and my own constituency, where local governments recognise the pressures around housing that they now have in their areas. Although they are supportive of the Government’s additional programmes of work—the Resource Management Act reforms, the National Policy Statement on Urban Development, the urban development authority—they want to make progress now and they want the tools of the special housing area Act extended.

That is the second part of this bill, which will enable those accords to be extended in order for local government and central government to work together on providing additional housing supply and have access to those fast-track methods for bringing in new housing supply. In amending that special housing areas legislation, the only change in the provision is to put extra pressure on the landowner and require that plan changes and resource consents are lodged within 12 months. There is a further, minor amendment to simply make the process less bureaucratic and allow those identified special housing areas to be divided by a plan and plan description, rather than just a description of the title specifically.

The third and final issue that is covered in this bill is the issue of the Housing Act and the way in which it is able to bring new houses on stream. That is important. The biggest housing development in New Zealand is in Hobsonville, which is former defence land. If we look at the Weymouth development, which I think every member of this House would say is a great initiative—it was the first special housing area—it also is surplus Crown land. The difficulty is that Governments for generations have assumed that when there is a housing development under the Housing Act it will not trigger the offer-back provisions. How do we know that? Because Governments and Ministers—on Labour’s side of the House; on this side of the House—whenever they have sold properties coming from such developments, have not triggered those offer-back provisions. The clear advice is that it was never intended that the offer-back provisions would apply where there is a housing development under the Housing Act. This bill provides clarity in that area of law, and it is important to Weymouth and it is important to Hobsonville because it provides the certainty that we are able to partner with the private sector and ensure that we continue to grow that important pipeline of new housing.

Every member of this House knows that there is pressure on housing. The truth is that New Zealand’s population is growing faster than at any time in our history. That is because people are voting with their feet—there is confidence in New Zealand and confidence in this Government—but, equally, that puts an onus on us to ensure that we build as many houses as we can and remove any legislative or bureaucratic impediment to more houses being built. That is why I challenge every member of this House to support new houses, more houses, for New Zealanders. This bill, this urgency, is a test as to whether members want to play politics or whether they want to support more houses being built for Kiwi families.

ANDREW LITTLE (Leader of the Opposition): You can tell just how serious this Minister is in getting this piece of legislation through, because he is relying on the crack team of Craig Foss to have to usher him along to get the bill through—this is how vital and essential this piece of legislation is. The reality is that the Minister cannot bring himself, even now—10 days out from the expiry of the special housing area legislation and having to rush through this piece of legislation—to admit what every New Zealander knows, and that is that we have a housing crisis. We have a housing crisis. He is just cobbling something together at the last minute, because he has suddenly realised that the dream of special housing areas is about to fly out the window with so few special houses built—he has got to do something about it.

I do not know how he persuaded his Cabinet colleagues to take the time of the House to pass this through under urgency when he has known, when he will have known, when he did know, that the legislation that we are now amending was coming up for expiry only 10 days away—only 10 days away. This urgency in this House for this piece of legislation is an expression of the complete and utter shambles that housing policy is in under this Minister for Building and Housing and this Government. That is what this is about. This House is taking its valuable time at this important time of the year to sweep up after this Minister yet again because of the total shambles that his policy is in. Every effort he has made, every policy he has introduced on housing, has completely turned to custard.

You look at the special housing areas and you look at the number now that are being offered for sale on TradeMe for land banking—they get the special housing areas, and yet some developers have no intention whatsoever of fulfilling the criteria and actually getting houses built. The whole condition of getting expedited consenting processes was that these developers with this special status would actually get houses built. But that is not happening in far too many cases. It is true that the Minister says there are a handful of them, they have got their applications lodged, and they have just got to bring it on a bit—this is with 10 days to go before the expiry of this legislation. There are far too few houses being built on special housing areas, and that is the problem—they have gone to land bankers.

The reality is that we have a chronic shortage of housing in Auckland and in other parts of New Zealand, and this Minister and his Government have failed to deliver for the thousands of New Zealanders struggling to get their first home. Let us not be mollycoddled by the figures that both the Minister and the Prime Minister have been trotting out. Let us be very clear that the 9,651 houses consented in the last 12 months are below the 12,000—nearly 13,000—consented in 2004. That was at a time when Auckland’s population was much, much smaller. So on a per capita basis, the building programme right now is way behind—absolutely way behind. If you have a look at what Statistics New Zealand says, and its analysis of the number per thousand people—sure, it has risen to 6.3 in the last 12 months from the low of 3.1 in 2011, but that is still only half what it was in 1974. That is the real measure—number of houses per thousand people—and this Government is way behind.

It is a comparative issue, and it is about New Zealanders’ prospects about getting into a house. It is no longer just any house, because plenty of builders are building the big, expensive, McMansion, million-dollar-average houses—plenty of those. It is that those on modest incomes are working hard, sometimes at more than one job—couples with several jobs between them—saving hard, working hard, chasing that Kiwi Dream, but they cannot get it. They cannot get it, because this Government does not care about affordable housing. This Government does not care about affordable housing. This legislation will help five—five—out of 154 special housing areas. We know that of the other 149 there are plenty that are just being land banked. That is all they are. There is no serious programme—there is no serious programme—to accelerate affordable house building under this Government in New Zealand today.

We could support this first part of this legislation, because at this stage anything—the smallest thing, the smallest skerrick of anything—that will help get one extra affordable house, I have to say that we have to support it. We would have to support that. But that does not explain or justify why the Minister has included these other provisions on the offer-back provisions under the Public Works Act. That is completely unrelated to anything to do with special housing areas and getting more affordable housing built. It is not needed. The provisions are not needed to achieve the objectives that he has of using special housing areas to get houses built. It simply is not needed. That assumes, of course, that even if these other special housing area applications are approved by the council after this legislation passes it will lead to more affordable housing very quickly—even assuming that, the Public Works Act provisions are not needed.

The reality is—and I want to hear from David Seymour from the ACT Party about this, because I think that the good burghers of Epsom will be very interested to know what is potentially happening to their property rights. Those who lounge back in the leafy streets of Epsom and Parnell, wondering how their investment properties are going, they will be wanting to know whether or not any property they own, or that they have an interest in or have had an interest in, that has been purchased under the Public Works Act—whether they are going have the right to get it back, because under these amendments they will not. Their rights will be traduced. Private property rights will be traduced in these provisions. It is not standard practice for the Labour Party to champion the cause of private property owners, but in the absence of the Government, and, so far, in the absence of the ACT Party, we have to. We have to, because nobody else is, and we ought to take that sort of measure very seriously. This House should not be passing legislation that traduces those rights quickly or inadvisedly or expeditiously just because we have a Minister who has performed so woefully in his portfolio that we are down to desperate measures.

The reality is this: New Zealand needs a genuine, comprehensive housing plan to fix the housing crisis. We need a housing policy and a housing package that is going to get more houses built, including, if necessary, in Clutha-Southland but certainly in the many other areas around New Zealand: Auckland, Hamilton, Tauranga, Taupō—as I discovered the other day—even up the Kāpiti Coast, parts of Wellington, Nelson, and Queenstown. New Zealanders are looking for an answer. They are looking for leadership on the issue of housing—genuinely affordable housing—because those on modest incomes, those on reasonable incomes, who work hard and save hard and do the best they can, no matter how hard they try, cannot get their foot on that bottom rung of the housing and homeownership ladder. That too we should be concerned about.

This piece of legislation, the first part, adds a mere skerrick, a mere iota, of difference to that objective, but that is all. But the other part, the second part, the offer-back provisions, will not help one bit. We are opposed to those, and so we cannot support this legislation in its current form.

There remains a possibility, I hope, that during the passage of this bill through the House under urgency the Minister might come to his senses, his colleagues might come to their senses, David Seymour might come to his senses, and say: “You know what? We all agree there is a housing crisis. We know something has to be done. We do need those special housing area provisions, as small a contribution as they will make to the housing crisis, but we do not need to traduce private property rights and create a constitutional crisis that we just don’t need.” If that happens, we could support the legislation but not in its current form—cobbled together, in a hurry, because this Minister is so desperate to prove, once again, that he does not have to get absolutely everything wrong. Well, he is on a hiding to nothing on that already, so let us just be honest about it. Let us just be honest about it.

This legislation, if it confines itself to the special housing area issues alone, we can support. In its current form, we cannot because it takes unnecessary steps that will add nothing at all to additional housing affordability, and while that is there, this legislation cannot be supported and will not be supported. I simply urge the Minister to look carefully and listen carefully. If we want to do the right thing for New Zealand and the housing crisis, it will not be in this bill in its current form.

ALFRED NGARO (National): I rise to take a call in this first reading of the Housing Legislation Amendment Bill, which is going through all stages. First, I want to acknowledge that this National-led Government has a comprehensive plan for housing.

Hon Members: Ha, ha!

ALFRED NGARO: That is right. We hear the heckling. But here is the proof of the pudding. Over there, on that side, the spokesperson on housing has often confirmed the comprehensive plan. When we think about the devolution of stock into the community housing providers—it was at the conference where the Labour spokesperson on housing turned around and said “We support this. This is a good idea. We should do this.”, and then, all of a sudden, when we were doing it, he disagreed with it. When it came to the metropolitan urban limits, the Labour spokesperson on housing turned around and said “No, this is not a great idea. We shouldn’t attack this.”, and then, all of a sudden, when we were addressing the metropolitan urban limits, he changed again. Why? Because he saw that this was a comprehensive plan. We know it is comprehensive. We know it is making a difference.

This Housing Legislation Amendment Bill does two things in particular. It extends two Acts, which we think is important, and it also puts a time limit on the consenting process. We think that is important.

The previous speaker talked about the whole issue around the crisis. But if the speakers on the other side have actually done their homework, and I hope that they have, they will realise that this issue has been bubbling up since 1974. In fact, a previous Cabinet Minister in the Labour Government, the Hon Dr Michael Bassett, was commissioned by The New Zealand Initiative to write a report. The report was called Priced Out. In that report he talked about when housing became unaffordable in New Zealand. Inside that report, he clearly states that this is an issue that has been happening since 1974. Why? Because we have not been building to projected forecast growth in New Zealand over that period of time. We know that that has been happening for quite some time, so we think that is really important.

Also, although the little mumbling and ground-grinding over there—[Interruption] Yes, maybe he needs to listen. If he has read the Productivity Commission’s report, what does it also say? It says that one of the critical issues is around the slow process of consenting. The special housing accord allows for us to fast track the consenting so that we can ensure that we can address the issue. What does it say? It says that the issue is around supply. This housing issue is around supply. We think that this is critically important.

The National-led Government wants to extend the Housing Accords and Special Housing Areas Act so that more special housing areas can be established and are appropriate for those different areas as well. We know that currently in Auckland, which is one of the most difficult places, there are 213 special housing areas—at least 140 of those are in the Auckland area—and that is making a difference. This will allow for the capacity of nearly 70,000 homes—almost 65,000 of those are in the Auckland area. This becomes critical.

When people have talked about the metropolitan urban limits, and if we talk about Auckland in particular, where this becomes a critical issue and the housing accord and this bill become of greatest importance, the metropolitan urban limits came in 1999 under the Auckland Regional Council. It was an arbitrary line that was drawn. We know that from that period of time we could see the challenges that were happening. In 2008 Gordon Copeland, who was a member of the Commerce Committee, went up to Auckland. That committee conducted an inquiry. It clearly said that the metropolitan urban limits were allowing for land banking, hence the reason why this bill becomes critically important in addressing that issue as well.

This legislation will allow for a variation of applications, begun but not completed under the law, to continue when a district plan becomes operative. We know that the current unitary plan will come into place on 16 September this year, so that is the reason why it is important for us to extend that and to allow for the opportunities for that development to happen. We know, also, that when we think about what currently exists, we think about the incentivised process of this plan and why that becomes important.

We can look at some of the numbers—the construction growth. The number of homes being constructed per year, in areas with housing accords, has grown from 10,599 in the year to June 2013 to 18,693 to June of this year. We know that it makes a difference. We see that is important. I commend this bill and look forward to the ongoing debate in the House under urgency. I commend this bill, at its first reading, to the House.

GRANT ROBERTSON (Labour—Wellington Central): I raise a point of order, Mr Speaker. I just seek your guidance. As this bill has been introduced to the House under urgency, obviously a few of us are playing catch-up to be able to prepare. There is a regulatory impact statement on the Table, around Part 1 of the bill, but there is no regulatory impact statement dealing with the matters in Part 2. I request your assistance and your guidance. Should we expect one of those, or just blunder on?

Mr DEPUTY SPEAKER: That is a matter for the Government, to provide that documentation to support its urgency motion. Challenge the Government on it. No doubt it is a point for debate. Let us hear it.

PHIL TWYFORD (Labour—Te Atatū): This is obviously not a bill that Government members are very proud of—when we see the stellar collection of front-bench heavy hitters who have turned out to support Dr Smith on this bill! The second member to speak from the National Party benches, Alfred Ngaro, could not even sum up a 5-minute contribution. All the heads are down. They are embarrassed because this bill is just the latest in a string of fiascos that pass for housing policy under this Minister. The image that I want you to entertain is of the Hon Dr Nick Smith standing out in the middle of a paddock somewhere in west Auckland, bewildered, and pointing in all directions, saying: “We’re going to build houses here, folks.” That Minister is outstanding in his field. He is outstanding in his field.

One of the great contributions that he has made to housing policy in the last couple of years has been a minibus tour where he took hapless members of the press gallery on a never-ending magical mystery tour of cemeteries, electrical substations, and a long list of other scraps and remnants. The Governor-General’s residence, Government House, even appeared on a list of Government properties that that Minister used as the basis for his now famous promise to this Parliament that he had 500 hectares of vacant Crown land that he was going to use to build housing. So that is great—look, you have got to give it to this Minister. He has provided more entertainment to this House in the last couple of years, in the form of his housing policies, than anyone could have realistically hoped for.

This bill is yet another patch-up job designed to mask the failings of Nick Smith as the Minister for Building and Housing. His incompetence is not a reason to put this House into urgency and to spend hundreds of thousands of dollars of taxpayers’ money to ram through a bill that simply should not be considered under urgency by this House. The bill has two main parts. The first is to extend the special housing areas legislation by 3 years. At a pinch, we might have voted for that—at a pinch. The special housing areas are a flawed, inadequate, underwhelming policy—

Hon Dr Nick Smith: You voted against it.

PHIL TWYFORD: We voted for it at the first reading, but when we actually had a serious look at it, we realised how hopeless it was. It is the centrepiece of the Government’s supply-side initiatives. How many houses has it delivered in 3 years, in a city of a million and a half people? There are barely 1,300 completed houses. Under this National Government, a shortfall of 42,000 houses has accumulated while National has been in office. That shortage is getting worse by about 4,000 dwellings every single year, and the best that this National Government’s policy of special housing areas can deliver is 1,300 houses over 3 years.

This bill is the last whimper of Nick Smith’s special housing areas policy. But it is something at least. It is better than nothing—which is why we would vote for it—but not by very much. The best thing that can be said for it is that it will save eight developers. Eight special housing areas in Auckland will be saved from cost uncertainty and the inconvenience caused by Nick Smith’s failure to properly think through the transition issues as the special housing areas legislation died and the Auckland Unitary Plan came on stream.

On its own, we would, at a pinch, have voted for Part 1 of this bill, which extends the housing accords and special housing areas legislation. But, as Andrew Little said, the second part—which deals with offer-back provisions under the Public Works Act in relation to Government land being used for housing purposes—is a whole different kettle of fish. Not only do we believe that there is no justification at all for this provision being considered under urgency but it is actually a really bad idea. I think it might be quite interesting to put some bets on the table that this bill and these provisions in Part 2 will be the next Nick Smith fiasco in a long line—a long, honourable line—of fiascos.

Nick Smith said that he is just trying to clarify—and no doubt he has got advice from Crown Law, and I would ask the Minister to table the advice from Crown Law on this—the position that the Government is not required to observe the offer-back provisions in the Public Works Act to former owners of land when it is changing the designation of Government-owned land and making it available for State housing purposes, which is interpreted extremely widely by this Government. He is saying the position is that the Government is not required to offer back that land if it is being used for housing purposes. Well, my question is this: if the law really does say that he is not required to hand it back, then why is he ramming through a bill under urgency—all stages? Why is he doing that if the law is clear and is not an issue? Because the Minister has brought this bill to the House, and because he is ramming it through under urgency, it is very clear, actually, that he is taking away somebody’s property rights.

We are not lily-livered on this side of the House about powers of acquisition and the need to prevent land bankers from gaming the system and standing in the way of large new developments that will deliver thousands of new dwellings in the public interest. But if you are going to take away people’s property rights, then, for goodness’ sake, think about it seriously. Do it in a way that is transparent and open, and subject this bill to the proper scrutiny, expert advice, and public submissions that a select committee process would bring. Do not ram it through the House under urgency. It is a serious matter when you are taking away someone’s property rights, so treat it seriously, treat the citizens of this nation with the respect they deserve, and do it in a way that is thoughtful, careful, and considered. There is no possible reason to take these provisions through the House under urgency in 24 hours and to deny the people of New Zealand the right to have this bill given proper scrutiny. This is the “Minister of Housing Fiascos”. This is the next fiasco that is coming down the pipeline, and, no doubt, in a year’s time we will be back in the House to clean up this mess.

The great fiasco of Nick Smith and vacant Crown lands was not so much that he produced a list that had Government House, electricity substations, and the Mangere Lawn Cemetery on it. The real fiasco was that he completely failed to consult important stakeholders like Auckland iwi on his plans to deny them their right of first refusal under the collective redress agreements in Tāmaki-makau-rau. He thought he could get away with it. I do not know what advice he took on that, but he blundered on ahead with his plan and was humiliated by Ngāti Whātua and other members of the Tāmaki Collective, who took him to court and forced him to do a—it was not so much a flip-flop; it was more a double backflip. He had to negotiate a humiliating climb-down that gave them rights to be development partners and all sorts of commitments about the provision of affordable housing in those developments, which he would not even offer to Auckland Council when he was negotiating the housing accord.

In this bill, he has had to recognise that that was an ignominious defeat. Not only did it cost tens of thousands, even $100,000 or more, in legal costs to the Crown but his Crown lands policy was delayed by months and months and months. What he has had to do in this bill is say that nothing in Part 2 of this bill will have any impact on collective redress agreements, but he is intending to deny previous owners of land their rights under the Public Works Act to an offer-back provision. This bill should go to the select committee.

TODD BARCLAY (National—Clutha-Southland): It is a privilege to be able to speak in support of the Housing Legislation Amendment Bill—and it is also a privilege to speak after Phil Twyford, given his positions on housing in New Zealand creating a fiasco of their own. This is the guy who called for a national emergency on housing, but will not support urgency on important housing legislation. I have been a strong advocate for an extension of the special housing areas because my electorate has benefited considerably from seven special housing areas to date, and because of this legislation, which I hope will pass, we will benefit from another, hopefully, up to half a dozen special housing areas—an additional couple of thousand houses coming on board in Queenstown, which is considerably important. Phil Twyford was opposed to the HomeStart initiative, but has expressed supportive comments in the past. He also wanted a capital gains tax—now he is opposed to that. Phil Twyford was also in favour of selling State houses, but is now opposed to it. He has got more positions on housing than anybody else.

This is an important piece of legislation. It is a great bill, and if he were to talk to any developer, any community housing provider, any home loan business, or any business in any of the fastest-growing areas within this country, he would know that they are also in support of this legislation. If he had been down to Queenstown—which he has—instead of just going up on to the ski field and having a great time, if he had actually talked to the Community Housing Trust there he would have found out that we have benefited by over a thousand new houses in the Queenstown area, delivered only under special housing legislation. We have had seven special housing areas under this, and we hope to see some more.

Andrew Little’s Public Works Act provisions are not needed; that is another example of how out of touch those guys are around housing in New Zealand. We have got a perfect case in point in my electorate at the moment, where the Housing Act is preventing, possibly, the onsale of Government-owned land to be used for worker accommodation and affordable housing simply because a former owner—20, 30, or 40 years ago—can put up his hand and say “I might quite like that piece of land.” Actually, that land is necessary to use for special housing and worker accommodation. This provision that we are passing today enables that demand to be met very quickly, so it is a privilege to be able to support this legislation. I want to congratulate the Minister on all his hard work in this space and thank him on behalf of my electorate for facilitating more houses being built. Thank you.

METIRIA TUREI (Co-Leader—Green): One million dollars—the average house price in Auckland today reached $1 million; $1 million to buy a house in Auckland. This Government has driven New Zealand’s housing into the ground. It has stripped away from ordinary New Zealanders the ability to secure their future for themselves and their children by driving up housing so it is so expensive that in order to buy a home in Auckland the average price is now $1 million.

And what do Government members say about that? Are they concerned about that increase in the cost of housing in Auckland? Are they worried that young families are being locked out? Are they worried that teachers, firemen, people who work in the Fire Service—

Phil Twyford: The police.

METIRIA TUREI: —and the police, these people who are essential to our communities across the country, in Auckland cannot afford to buy a house in the city that they love and serve? Are National members worried about that?

Well, no, and that is obvious today because, in response to the $1 million average house price announcement, we end up spending a whole day debating this ridiculous bill that will not solve the housing crisis. If they were genuinely serious about making sure that people who work in the Fire Service, or teachers, or principals of schools, or nurses or doctors—these people who serve our communities in Auckland—were actually able to live a decent life in a secure home in Auckland we would not be passing this bill, we would be dealing with a genuine comprehensive plan to make sure there was affordable housing in our biggest city so that ordinary New Zealanders had a genuine chance to own their home.

Instead, we are dealing with a piece of rushed legislation that is poorly thought out, that strips away the property rights of some, in order only to extend what has been a failed policy in Auckland. The special housing areas (SHAs) policy has failed in Auckland and this legislation is designed to extend that failed policy because this Government has no other ideas about how to fix New Zealand’s housing crisis—a crisis that has seen homelessness increase beyond all measure over the last few decades—and it is seeing young families and elderly people locked out of securing their future.

The special housing areas have not delivered in Auckland. Of the 157, 97 have no building on them; two-thirds have no building on them. They are simply sitting there, and do you know why? It is because land bankers and speculators are making a huge amount of money by sitting on these special housing areas that Nick Smith and the Government have allowed them to have cheap. As I understand it, only 1,300 buildings have been built. That is a ridiculous failure by this Government over the last 3 years. Special housing areas have helped many speculators and many land bankers increase their wealth while hard-working families, young people trying to secure their future, and older people trying to secure their retirement are locked out of housing in Auckland.

It is a continuation of Government’s housing failure that this is how we have to spend our time: dealing with this bill. It will not solve the crisis and, indeed, it could make it worse by extending special housing areas and not dealing with the land banking issue that they create. This bill is nothing but a band-aid on a wound, a housing wound that ordinary New Zealand families are having to carry every day. I think that “fiasco” is the right word for this Government’s response in this legislation. We are in the middle of a homelessness crisis, the nature of which we have not seen for decades—for decades; a $1 million average house price in Auckland, State housing still being sold off while the waiting list for State houses grows and grows, and the only response is this rushed piece of legislation, poorly considered and desperate to keep the special housing areas going.

Why is that? It is because the Government’s only solution is to allow more private developers to have access to land and have access to fast-tracking consents. That is its only solution. It is taking no responsibility for its role in being able to provide housing itself through a comprehensive build programme that New Zealanders are desperately crying out for. The Government knows that it can be much more engaged in actually building affordable homes. Instead, its solution is to allow land developers, speculators, and land bankers to make more money off this crisis.

What does the bill actually do? Well, what the first part does allow is really in response to just eight developers in eight special housing areas that are halfway through their consenting process—so they are nearly complete but they have not completed their consenting process. If the special housing areas legislation expires on 16 September, as it is set to do, then those eight developers will have to restart their consenting process over again. There is an argument that says it would be worthwhile extending the time period to allow those eight developers to get their consents through—as long as, of course, they were actually required to build, and it was not just another attempt, another opportunity, for Nick Smith and National to allow more land banking.

If that was the case, that there was certainty that they would build, there is an argument that says we could use urgency to allow for that extension of time. Perhaps we could have a day of select committee. We could hear from officials and from those affected so as to be able to know that we have all of the information right and that when we were passing a law through urgency that that law would be properly considered, properly constructed, and effective. This is because a large part of the problem with urgency, of course, is that most of the law we pass through urgency is useless and full of mistakes. So that is an argument for saying that part of the bill could be justified with a short period for consultation with the public and those affected. I would have listened to that argument and taken it seriously if it had been put to me.

The problem is that the bill also does other things that do not need to go through urgency and that actually do need to be properly considered. These are the two areas. The legislation extends the failed SHAs for another 3 years and it does not protect against land banking. The provisions in this little bill do not protect against land bankers. It gives the Minister for Building and Housing more powers and sets a time frame, but there was already a time frame in the previous legislation. It does not prevent land banking and that is one of the major problems, the major failures, of the SHAs in Auckland. Neither does this bill improve the percentage required to be for affordable housing. So the problem for SHAs is that we cannot guarantee that there will be a significant provision of affordable housing through these special housing areas. This bill does not require more affordable housing from those special housing areas. It, again, provides wealth acquisition opportunities for the speculators, but will not deliver affordable housing for the thousands of New Zealanders who need it.

Hon Dr Nick Smith: That’s rubbish! Just rubbish!

METIRIA TUREI: The Minister keeps saying it is rubbish, but there is nothing in his bill that is going to improve the provision of affordable houses in those SHAs. It gives him more powers; it does not provide any more certainty to New Zealanders who are desperate for this housing because they are in such dire straits.

And of course we have the offer-back provisions, which provide real concern. Nick Smith says that there are no Māori who provided that land for use for housing and who would be the first people under an offer-back provision to be offered that land back. He does not know that for sure. He does not know that for sure, but he says he does not think there is any—and we are supposed to accept that from Nick Smith, who thinks that birds pooing in rivers is more important and more dangerous than cows pooing in rivers. This is not a man with a great sense of perspective about what is important.

We cannot support this bill in its current form. We do expect there to be some changes over the course of today and tonight—perhaps a splitting of the bill. But as it stands it is ineffective, it is a waste of time, and it will simply increase the risk of land banking and a lack of affordable housing in Auckland. Thank you.

DENIS O’ROURKE (NZ First): How dare that Minister over there, the Minister for Building and Housing, claim the success of special housing areas when after 3 years we see 1,300 houses having been built. Now we have a panic measure to expand that by another 3 years. That will not help the situation, because success will not result from a failure; it will just be more failure. This Government should not be allowed one more day in power when it has made such an unholy mess of housing in New Zealand through its own actions. It is this Government’s actions that have actually caused the housing crisis, and it is this Government’s inaction that has failed to remedy it. In addition to all of that, you have a situation where as a result of an open-ended immigration policy—which actually does create significant demand, despite denials by the Government—it then has to panic to provide more homes when that could be avoided by having a sensible immigration policy and a genuine strategy for building homes in New Zealand.

The housing policy that is actually claimed to be a comprehensive housing policy is none of that. It is nothing at all like that. It is getting worse. The effects of it are getting worse through Government inaction, and the need for this particular bill is just evidence of that.

Look at the results in Auckland, where people are actually leaving in droves because they cannot buy houses there because of the prices. They cannot rent there because the rents are too high, and between 2008 and 2013, 32,184 of them left Auckland for Wellington, Waikato, Canterbury, and elsewhere, while 3,000 less than that number went there from those areas. So there is actually a drift away from Auckland because of these problems. The problem with that is, as Shamubeel Eaqub said: “The challenge for a lot of people is they’re not able to get the same kinds of jobs or job security in other parts of New Zealand.” That is probably why it is only a third of the people saying that they have actually considered it.

It is actually worse than that. It is worse than that because, in fact, while 32 percent of Aucklanders want to move out because of housing pressures, another 36 percent would also go if they could get adequate employment in the other regions. That outflow is actually hurting Auckland’s economy. As Alan Johnson of the Salvation Army said: “There’s people leaving Auckland in bigger numbers than ever because of the house prices. It will undermine the city’s competitiveness. People doing lower-paid jobs, particularly in the service and construction sectors, need to be able to afford to live in the city.” Is that not putting it in a nutshell? So the fundamental problem, as we all know, is that housing in Auckland is actually unaffordable, and, worse than that, it is still a runaway problem.

The failure to deal with that is all based on this Government’s neo-liberal belief in the market as being a way of solving these problems. It seems to think that blaming local government and providing more liberal planning laws will somehow result in a solution to these problems. Of course, it is, as I have said, exacerbated by an open-door immigration policy. And it is caused by Ministers—three of them, in fact—who are simply not on top of their jobs. They simply do not know how to do this; they do not know how to solve it, and they should all resign. In fact, the whole Government should go and let parties into Government that can actually deal with these issues.

In the context of such comprehensive policy failure—and that is what it is—New Zealand First will not support this bill. In that context, New Zealand First will not support this bill. There are two reasons. The Government is hanging its hat on one primary action: these special housing areas. New Zealand First does not have a problem with special housing areas in themselves. We do not disagree with that. That is OK. It is actually consistent with New Zealand First policy. But, in fact, it is not enough, because all it does, as I have already indicated, with local government agreement through housing accords, is to define land available for housing. It does no more than that—and because it does no more than that it does not necessarily result in more houses being built and, especially, it does not result in more houses that people can afford to buy being built. Therefore, it is a failed policy and for that reason—because it does not go far enough, it does not do enough—how could New Zealand First possibly agree to such measures to extend it?

After 3 years of failure, and because of the Government’s failure to actually invest in housing rather than just provide for these areas, we have a continuation, and we will continue to see a worsening housing crisis in Auckland. Without actual investment in the purchase of land and the development of land by the Government, this problem will never cease, because the market cannot—cannot—provide what is needed in New Zealand. And that is no surprise—that has actually been the case for a very long time in this country, and it has not changed. Why this Government thinks it will, I cannot possibly imagine.

The pathetic 1,300 house result will, actually, continue. Maybe it will do a little bit better than 1,300 over the next 3 years, but that is such a drop in the bucket it does not even begin to address the housing crisis, especially in Auckland. New Zealand First’s housing policy is much better than this—and I can see the Minister grinning.

Hon Dr Nick Smith: I’m laughing.

DENIS O’ROURKE: Look at him laughing. He should be laughing at himself, because we can see his policy in total failure, and yet he will not listen to anybody else. The fact is that New Zealand First wants a housing commission to do the strategic planning that this Government does not even consider to be necessary.

Secondly, New Zealand First would establish Kiwi Housing to buy and develop land on a scale that this Government has not even considered, to ensure modest homes are built for modest prices, and to allow easy term repayments for people who wish to buy them.

The second and unrelated part of the bill is to change the law—not to confirm it or clarify it, as is being claimed—to change the law to allow the sale of State housing land without offer-back provisions. That is the normal process. Those offer-back provisions are the normal process under the Public Works Act because they protect the rights of people. Those rights should always be respected and should not be done away with simply because this Government is in panic mode over housing in New Zealand. That is not good enough. People’s rights are worth more than that. We will not support that provision for that reason alone.

In addition to that, the fact that the Government is looking at this actually demonstrates its failure of strategic planning and implementation. If it had looked forward enough, done the planning, and had a decent strategy, it would actually have the time to buy and develop land without having to do these short cuts and without having to compromise people’s rights.

I want to point out some of the words that the Government claims justify this. On the end of the justification are the words “where the disposal is necessary to achieve the Crown’s housing objectives.” Well, what are those objectives? The Government claims they are to build more houses—but this is State housing land. It is social housing land we are talking about, and the objective of the Government is actually the sell-off of State houses in the absence of a genuine and comprehensive programme for the building of more State houses. It is also their objective to fob off State housing to community organisations, many of which are actually not capable of doing that job, simply so that this Government can minimise its involvement in social housing. For all of these reasons, there is no possible way that New Zealand First will vote for this bill.

Dr PARMJEET PARMAR (National): Thank you for the opportunity to take this call on the first reading of the Housing Legislation Amendment Bill. I am taking a short call to support this bill. To that member who just spoke, Denis O’Rourke: yes, people are coming to New Zealand. We are attracting people from all around the world because the economy is doing so well under this National Government. Unemployment is 5.1 percent—below 5.5 percent when compared with a year earlier. Wages are rising faster than inflation. These are the reasons why people are coming to New Zealand. We are attracting international students to come to New Zealand, we are attracting tourists to come to New Zealand, and we are attracting economic migrants who are looking for better opportunities—they are coming to New Zealand.

It is a contrast to what was happening under the previous Labour Government when people did not want to live in New Zealand because they could not see any scope, and they could not see any opportunities for themselves and their children here. They were moving overseas to live and work, and that is why we did not have this pressure that we are experiencing under this National Government. We are a very fortunate country to be in this position, where people want to come and live here in New Zealand.

National does not have a blame policy like the New Zealand First Party and the Green Party. Talking about the median house price—like the Green member Metiria Turei, who spoke before, did—this means that there are houses of higher and lower value than the price of $1 million. It does not mean $1 million is the minimum house price; it means it is the median house price. It does not mean that there are no houses available for less than $1 million, or that houses are not available for more than $1 million.

This Government has been working hard to improve the supply of houses by signing housing accords, by establishing special housing areas, and, also, we are very keen to reform the Resource Management Act. That is why this legislation is important, because this is to extend the Housing Accords and Special Housing Areas Act 2013 so that more special housing areas can be established as appropriate. I support this bill and commend it to the House.

MARAMA DAVIDSON (Green): I am standing to oppose the Housing Legislation Amendment Bill, which is being rushed through this House.

It is very clear—it has been clear for quite some time, actually—that this Government has lost control. It has no handle on the housing crisis, and has no handle on the extent and the scale of homelessness in this country. It is forever continuing to try these band-aid, mop-up bits of legislation to make it look as if it is serious about addressing this very serious issue, which New Zealanders understand is serious. It is trying to make it look like it is addressing the core part of the problem of homelessness and the housing crisis, and it is using mop-up, band-aid legislation to do that.

I liken it to imagining that there are houses on fire, and the Government is, firstly, denying that they are on fire, and, secondly, rushing to try to put the fire out with half a hose. The Government’s mop-up bits—its band-aid legislation—are not even fulsome enough to properly address the emergency status of what is happening, let alone going anywhere near the deeper, fundamental, core problems that are causing more and more people to become homeless.

This is why, in question time today, John Key could not commit to ending homelessness—it is because he cannot. He does not want to promise that. He could not even say what one of the submitters at our hearing in Kaitāia just last week said to us, which was: “This should be the last generation of this country to be impacted by homelessness.” That is a goal—that is a goal. This should be the last generation in this country to experience homelessness—any insecure tenure. That is a goal. Today in question time, New Zealanders, our Prime Minister could not even commit to that. He has left our New Zealanders out in the car, cold; in the garage, crouched up, cold; and at the park, cold—that is what he has done to our country: he has left our people in the cold. And he cannot even promise to get them back in the warmth. He cannot even do that. Today in question time, folks, that is what we confirmed from this Government.

That is why these failed pieces of legislation are failing. It is because they are not addressing the core roots of the problem. The Government is trying to mop it up to make it seem like it is doing something. This special housing area (SHA) legislation—oh, it went so wrong. The developers asked why they would want to bother ensuring that even 10 percent of housing was affordable—that is all the SHA legislation, even as it is, guarantees as affordable. It is only 10 percent; the developers do not even want to agree to that. They are not into that 10 percent being affordable.

Now let us look at this word “affordable”. It means 75 percent of the median. Does this Government understand that, even at 75 percent of the median for Auckland, it is still not actually affordable? Does the Government get that? New Zealanders do—New Zealanders do, I tell you. This is why real solutions are needed—for example: capital funding, a capital gains tax, banning non-resident sales and buyers of homes in New Zealand, and the Government building affordable housing where our families and our people can pay a weekly amount into the capital of owning their own homes, without needing to have a deposit. Those are real systemic and enduring solutions, not this SHA legislation, which has already failed—it has already failed. So, no, we are not going to support this bill, because it is half a mop and it is half a band-aid. The country is on fire and it is half a water hose. Thank you.

JENNY SALESA (Labour—Manukau East): Mālō e lelei. Mālō e ’fakakoloa ’a Aotearoa ’aki ’e lea faka-Tonga. Happy Tongan Language Week, Mr Assistant Speaker. The theme for this year, 2016, is enriching Aotearoa with the Tongan spirit.

Thank you so much, Mr Assistant Speaker, for this opportunity to take a short call on the Housing Legislation Amendment Bill. It is unfortunate that we are discussing this bill under urgency, because I believe that housing is such a crucial issue that it should be going through the actual process and we should actually take our time and allow the public to make submissions on this bill. It is legislation being proposed that is the latest string in a fiasco proposed as housing policy under this Minister.

Having a roof or a home is a basic human right, but, unfortunately, it is a basic human right that is not afforded to so many, to thousands of our people, especially to our children. We know from Otago University that in the 2013 census figures there were at least over 41,000 who are homeless, and we also know from this analysis that 10,000 of them are children under the age of 15.

I see too many of these families in my office. They come in the cars that they live in. Some of these mothers ring up and say: “I don’t have a car, but I’d like a house to live in. Can you please come and help?”. Many of our staff members do not really like to go and do house calls, but when you get a phone call and you are talking to a mother with five kids, seven kids, or sometimes nine kids, and they tell you that they do not have a car, they do not even have the bus fare to get to your office, you get in your car and you go and you help those families out.

Just in the weekend I got a call from one of my teachers in Ōtara. This is a teacher who had been looking after five kids. This teacher no longer taught these five kids, but the eldest of these kids was now 16 years old, and she was attending a school together with her eldest son. This family was homeless. This teacher said that she felt responsible. The son had told her that they had been homeless for quite a while. This family was a working family, but they were made homeless because the landlord sold the property. I see too many of these families that have been homeless because the landlords have decided to sell the house, and there are not enough State houses to help these families.

It is an indictment on our country, Aotearoa New Zealand, that it takes a family like this to reach out to the member of Parliament, then for the member of Parliament to have media involved, before a family like this actually gets to access a house. This is a fair country. We used to be so proud that we were an egalitarian society—well-known internationally for being an egalitarian society; for looking after our own, especially our vulnerable families—but we live in a day and age when this is no longer the case.

Just today we were told that the house prices in Auckland are over $1 million. But we also know from the statistics that 80 percent of the houses sold in Ōtara last year—in my electorate of Manukau East—were sold to investors. When we know that Ōtara houses are being sold to investors, what that means is that investors have to recoup their costs. Whom do they recoup these costs from? It is from our tenants and most vulnerable families—the families who can least afford to pay these rents. Six years ago rent was only about $230 for a three-bedroom house in Ōtara. Today, 6 years on, it has doubled.

So why is it that we are seeing so many homeless families? It is because the rent is out of control. In general, more than 50 percent of people in Auckland rent, but when we look at vulnerable families, we see, for example, that 82 percent of Pacific families rent, either from private landlords or from the State. Is this bill, the Housing Legislation Amendment Bill, which we are discussing under urgency, going to deliver for any of these families? No, I do not think so, because the affordable houses that the Hon Nick Smith talks about are houses that are $500,000 or $600,000 and above, and that is not affordable for many of our vulnerable, poor families. Thank you.

GRANT ROBERTSON (Labour—Wellington Central): No one else seems to be bothered to take a call. If there was nothing else to describe Nick Smith as a Minister for Building and Housing and his policies, we have seen two emblems of them today. The first of those is that he is now the “million-dollar Minister”. That is Nick Smith’s lasting legacy to the people of New Zealand—that the average house price in Auckland is a million dollars. I want to be clear about what that will get you in Auckland: a million dollars in Auckland today will get you a two-bedroom brick-and-tile in Mt Roskill.

Marama Davidson: Is that all?

GRANT ROBERTSON: A two-bedroom brick-and-tile in Mt Roskill is the million-dollar dream of this Minister. That is a disgraceful legacy to New Zealand, to see housing go so far out of the reach of hard-working New Zealanders—the primary school teachers, the firefighters in Auckland who cannot afford to live there anymore. It is a city with a housing market out of control, and for 8 years all we have had from the National Government is denial—a denial that there is a problem; an excuse; a person to blame; an organisation to blame—anyone other than this National Government stepping up and taking responsibility. Today Nick Smith can say “I’m the silver medal winner for New Zealand.”, because New Zealand has the second most overvalued properties compared with rents and the second most overvalued properties compared with incomes in the OECD. That is what we have reached under Nick Smith: a housing market that for most young New Zealanders means the Kiwi Dream of owning their own home, being part of a community, and providing security and stability for their families is slipping away.

The National Government comes to the House today with the second of the emblems of Nick Smith’s time: yet another piecemeal, tinkering, small measure that the Government brings forward and then says: “You’ve got to do this under urgency.” It is an emblem of the catalogue of incompetence and of the chaotic and damaging housing policy of Nick Smith, to bring this bill to this House under urgency.

I want to state right now that the Government should accept a Supplementary Order Paper from Phil Twyford to split these bills in two—to split up Part 1 of the bill, which says that these special housing area provisions need to be extended. This is because—and I will return to this in a minute—there is at least a small amount of value in that proposal, albeit it very small. But Part 2 of the bill—which actually has nothing to do with Part 1 of the bill, and they should not even be together at this point—should go to a select committee. What is the urgency, Dr Smith? What is the urgency for Part 2 of the bill?

Hon Dr Nick Smith: Getting houses built.

GRANT ROBERTSON: “Getting houses built.”, he says. You have had 8 years and you have not shown any urgency. Why today, on a provision that is significant? The provision is significant because it takes away the rights of certain New Zealanders. It could be justified; we need a debate about that. There is no way that a piece of legislation like this and as important as this should be blithely brought through under urgency.

I went looking for the regulatory impact statement on this matter—on Part 2 of the bill—and found nothing on the Table of the House. But we do have the departmental disclosure statement on the bill as a whole, and it makes for disturbing reading. That is because Part 2 of this bill changes the process in terms of the right of offer—

Hon Dr Nick Smith: No, it doesn’t.

GRANT ROBERTSON: Yes, it does. Why are you putting it up, Dr Smith, if it does not change the process? Why is it in the House? Why are we all here? If you are not doing anything, why is it in the law? He does not know, does not have an answer, and has not got a clue about what he is doing.

What is worse is that in the departmental disclosure statement the Government is required to answer a series of questions—all departmental disclosure statements have to answer these questions. It says: “Part Four: Significant Legislature Features. Compulsory acquisition of private property. 4.1. Does this Bill contain any provisions that could result in the compulsory acquisition of private property?”. Answer: “No”. That is what the Minister and his department are telling his officials—he says: “No.” Is that not precisely what you, Dr Smith, are trying to achieve with the bill—to say to people who may have had a right of offer back that they no longer do?

Well, if you do not like that one, we will go further down the page in the departmental disclosure statement to where it says: “Significant decision-making powers. 4.6. Does this Bill create or amend a decision-making power to make a determination about a person’s rights, obligations, or interests protected or recognised by law, and that could have a significant impact on those rights, obligations, or interests?”. The answer from the Minister: “No”. He says: “No.” That is categorically untrue, Minister. You have misled your Cabinet colleagues, because that is precisely what this provision in Part 2 does—

Hon Dr Nick Smith: It doesn’t.

GRANT ROBERTSON: —and if it does not, why is it here? Why have you put it in the law?

Hon Dr Nick Smith: Read it.

GRANT ROBERTSON: Read it? I have read it, Dr Smith, and what it does under Part 2 is it changes the way in which some people may believe that the Public Works Act applies to them in this law. Now, Dr Smith, this is the problem, because what should be happening at the end of this debate is that this piece of legislation should be going off to a select committee. Maybe, just maybe, we can accept that Part 1 of the bill cannot do that, because—despite being warned by Phil Goff in May that there were going to be problems with the special housing areas and the Auckland Unitary Plan—Dr Smith has waited until 6 September to come to us with an urgent law because the whole provisions around special housing areas expire on 15 September, so maybe Part 1 passes the urgency threshold. Part 2 does not pass the urgency threshold.

So, Dr Smith, here is your chance: split the bills in two. Part 1 comes through; many parties in this House will be able to support that. Part 2 goes to a select committee, and the public will actually get to make some submissions on a fundamentally important change in law around whether or not there are offer-back provisions under the Public Works Act. The Public Works Act—and everyone in this House will have had some interaction with it during their time as a politician or beforehand—has a hierarchy in it. It has a process for the return of land, or the offer back of land, to the original owners. If that is changing—which, presumably, is the only reason you would put something in a law, because if it is already the law you do not need to change it—that deserves proper scrutiny. That is a major change. That is about people’s property rights, which Dr Smith claimed today are not affected by this clause. They quite clearly are, Dr Smith. You have misled your Cabinet colleagues, and it is time to actually have a proper debate about this bill.

The special housing areas promised so much from Dr Smith. They promised that they were going to be the panacea for Auckland’s housing crisis, in particular, and yet we have seen such little action from them—around 1,300 actual houses. During the period of time when National has been in office, the deficit in housing has gone up by over 40,000 houses and 163,000 extra people have arrived in Auckland during that time, and the Government has failed to keep up. In 2016 we are going to see, what, around 9,600 houses built. That is still well below the 13,000 houses that are required. If you look at it on a population basis, we are getting around 6.3 consents for every 1,000 people, yet we need it to be up at around 13 or 14 consents, which is what happened when the Labour Government under Norman Kirk took this seriously—

Hon Dr Nick Smith: Did not.

GRANT ROBERTSON: It is exactly what happened. We took this seriously the last time, when Norman Kirk was the Prime Minister, in the 1970s. What we needed—and if we were to be here under urgency, it would be to have a comprehensive housing plan to build affordable homes, to crack down on speculators, and to actually build more State houses and not, as this Government does, avoid doing that because it is, in the words of the Dominion Post today, “fundamentally averse to building … state houses.” Those members have got their ideological blinkers on and that is bad enough, but if you add to that pushing through under urgency a fundamental change to the Public Works Act and how it applies, it is a disgrace to use urgency this way, from a failed and hopeless Government.

MAUREEN PUGH (National): It is my pleasure to take this call on the Housing Legislation Amendment Bill. This is an omnibus bill and yet another tool in National’s tool kit in its comprehensive housing plan. There are now 213 special housing areas (SHAs) across New Zealand. They are in Auckland, Christchurch, Wellington, Tauranga, the Western Bay of Plenty, Selwyn, Tasman, Nelson, and Queenstown, and they have the capacity to build and provide 70,000 homes. We need to protect these SHAs and provide for more.

Worthy of note in this bill is that it sets time limits on lodging resource consents and plan variations, which, in turn, encourages developers to begin building in special housing areas quickly. Consents must be lodged within 12 months of an SHA being gazetted. If this bill does not progress, the SHAs listed above will lapse and the developers will need to restart their plan change process under the Resource Management Act. This could delay that housing coming on stream by at least 2 years and, potentially, up to 5 years.

This Government is serious about building houses, and this bill is an important part of improving the supply of land and providing the tools to get houses built. I commend this bill to the House.

The ASSISTANT SPEAKER (Hon Trevor Mallard): Before I call a member, I am just taking a little advice as to whether we alternate or whether we—because, of course, National—sorry, I have muted my own mike. I am just taking a little bit of advice before I call a member. I have seen the two members who have called. I am taking a little bit of advice. There is a Business Committee decision as to the order of calls, but it does not take into account when a party chooses not to take a call, as happened earlier. So I am just getting some advice as to whom I should call.

CARMEL SEPULONI (Labour—Kelston): We are highly opposed—as you will have heard formerly from my colleagues who have spoken, not just from the Labour Party but also from the Green Party and New Zealand First—to the fact that the Government has made the decision to put this bill through under urgency. We have been trying to get some urgency over the housing issue for at least the last 2 years and we have not got any urgency on things that matter, including—can I just mention—the issue of homelessness, where we tried to get the Government to agree to do a cross-party inquiry into this very important issue. Instead, we have had to do it in partnership with the Greens and with the Māori Party because the Government did not see a need for that to be urgent. But here we are today, considering something in urgency, basically because Nick Smith—again—has made a shambles of the housing situation.

I just want to say—and I have been yelling it out from the backbenches over here—that, actually, I think Nick Smith will go down in history as the worst housing Minister New Zealand has ever had. What a legacy—what a legacy for him to leave here. It is part of a string of fiascos that pass for a housing policy under the Minister, and yet we still have to listen to that Government—every time those members stand up in the House—say that it has a comprehensive housing package. There is no comprehensive housing plan that the National Government has going on. The plan—the only plan—that New Zealand needs from the National Government is a commitment to building houses. We do not need a pipeline and we do not need a consent, because we cannot live in a pipeline and we cannot live in a consent. We need actual houses, and we have not been given them so far.

Although Labour would vote for the first part, which is extending the housing accords law here, we think it is untenable, actually, to push the second part, with changes to the Public Works Act, through all stages under urgency. If both parts—as we have said earlier—are included in this bill, then we cannot vote for this bill—and, actually, I think my colleague Phil Twyford did put up an amendment trying to split the bill, but that has not been supported. My understanding is that it has not been supported by the National Government. So easy—we could so easily support part of this; we just cannot support the second part—it would be so easy for the Minister to just split it in two so that at least he could get some consensus in the House for part of what he is trying to do. But we cannot commit to the second part because we do believe there needs to be some public scrutiny on that, particularly in respect of what we are dealing with there—that is, basically, changes to the way in which the Public Works Act applies.

I want to talk just a little bit about where I have seen that specific part of the Public Works Act applied to my own electorate, and that was with regard to the Waterview Connection. We know that as part of the Waterview Connection a whole lot of properties were purchased from Housing New Zealand as part of the Public Works Act process—and also private houses—so that that particular motorway could be built; then, in the end, actually, a whole lot of them were not required. You know, as New Zealanders we can have peace of mind that, actually, the first port of call in terms of offering those houses for purchase back was actually to Housing New Zealand, because it had sold them as part of the Public Works Act process in the first place. Unfortunately, in that situation Housing New Zealand did not purchase the houses back—it should have—Housing New Zealand acted as if there was no need to recoup that housing, and then those houses ended up going up for private sale.

But we know that if there was a responsible Government, then that measure is actually a very sensible measure to have in place. That housing was not required for the roading project. It should have gone straight back to Housing New Zealand. Housing New Zealand had the opportunity to purchase it back. Unfortunately, in that situation, it did not—but I am happy that at least that safeguard was in place, and I do not want it to be messed with, particularly given that we have not had any time to actually scrutinise what is being proposed here by the National Government. In fact, as some of my colleagues have pointed out, it does not seem like National members have actually had time to scrutinise what is in front of them for themselves. In fact, Nick Smith seems a little bit confused about what is actually in this bill, and we are concerned, actually, that perhaps the way in which Nick Smith has communicated this to his Cabinet is slightly misleading. But, given that this is going through under urgency, we will not have the opportunity to scrutinise it to the extent that we need to.

Earlier, people who have been on their feet on this side of the House talked about some of the issues that we are facing in respect of housing, and, actually, we have made it really clear that this is a priority for Labour in Opposition and Labour when we are in Government. I just want to say that it has been really disconcerting to see the response that we got from the National Government on a number of issues. Particularly, let us start with the fact it denies there is a housing crisis in the first place. And then, yet, we get responses back from them like the one I got back from the Minister for Social Housing, who states that it takes 155 days to house someone who is homeless—155 days to actually house someone who is homeless—who is living in their car, living in a garage, living under a bush somewhere; it takes that Government 155 days to house them.

I have had difficulties even getting a definition out of the National Government in respect of what homelessness is. In fact, when I asked the Minister for Social Housing what the definition for homelessness was I got a response on the day that the response was due saying that she needed more time to be able to provide that answer. More time to be able to provide a definition for homelessness? We just have to wonder what the criteria that we are working under are, and whether the Government even knows what is going on. And then we hear, through a University of Otago study, that there are approximately 41,000 - plus people who are homeless in this country and the National Government says that it does not believe that figure—

Hon Dr Nick Smith: It’s crap.

CARMEL SEPULONI: —that that figure is not correct. Oh, actually, I think I just heard Nick Smith say that that figure is crap. Well, actually—

The ASSISTANT SPEAKER (Hon Trevor Mallard): Order! I probably should have pulled the member up, but I do not want it repeated back and forth, thank you.

CARMEL SEPULONI: Sure. Thank you, Mr Assistant Speaker. Actually, we see it every day in our electorate offices, particularly those of us who live in electorates that have people who are living on lower incomes. As my colleague Jenny Salesa said before, it is not just those who are on benefits—although we are concerned about those people who are homeless—but there is also a growing number of working poor who cannot afford to put a roof over the heads of their family and are living in cars. That is concerning to us, but what is really concerning is that it does not seem to be concerning to the National Government.

This bill, as I said earlier, is another step in this shambles that has been the Government’s housing accords. It demonstrates, yet again, the Government’s incompetence on housing. The Government was well aware that some of the special housing areas could lose their ability to continue under the new Auckland Unitary Plan before the housing accords legislation was even passed—and yet now it is pushing through legislation with only 10 days to go before D-day. This could have been considered in a more responsible way, but the Government has not thought forward, it has not been organised, and here we go again in the chaos that is the National Government’s supposed comprehensive housing plan.

The housing accords have failed to deliver new housing, with only just over 1,000 houses actually completed in Auckland after 3 years, yet the Government now proposes to extend them for another 3 years. They have also been a goldmine for land bankers—I think my colleague Marama Davidson was talking about this before—with only 57 of the 154 special housing areas actually having building consents in them, so far. If the Government was serious about delivering more housing, it would actually adopt Labour’s KiwiBuild plan to build—

Hon Dr Nick Smith: It’s a joke—it’s a joke.

CARMEL SEPULONI: —100,000 affordable houses. It is not a joke when a political party has a plan to build more houses in the midst of a housing crisis, Nick Smith. That is not the joke. The joke is that that Minister refuses to listen and acknowledge that there is a housing crisis in this country. That is the joke. The joke is that that Minister has brought the bill to the House under urgency because he was not organised enough to get this through the proper channels earlier on, when he should have. That is the joke, Mr Smith.

A party vote was called for on the question, That the Housing Legislation Amendment Bill be now read a first time.

Ayes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Noes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Bill read a first time.

Points of Order

Leave to Divide Bill into Two Bills—Housing Legislation Amendment Bill

PHIL TWYFORD (Labour—Te Atatū): I raise a point of order, Mr Speaker. I seek leave for the bill to be divided into two bills, as described in my amendment; for the bill containing Part 1 of the Housing Legislation Amendment Bill to be set down for second reading forthwith and for the bill containing Part 2 to be referred to the Social Services Committee to be reported by 25 November 2016.

The ASSISTANT SPEAKER (Hon Trevor Mallard): Is there any objection to that process? There is objection.

Bills

Housing Legislation Amendment Bill

Second Reading

Hon Dr NICK SMITH (Minister for Building and Housing): I move, That the Housing Legislation Amendment Bill be now read a second time. This bill is a litmus test as to whether people want houses to be over people’s heads or whether people just want to play politics and play rhetoric. The frank choice for this Parliament is that this bill will get more houses built. What I find so extraordinary from members opposite is that they set up inquiries and they demand that the Government takes a state of emergency on housing and puts the whole country into some civil defence crisis, but they are not prepared to come down to this Parliament and support a practical bill that will actually get houses built. But I am not surprised—I am not surprised.

I will tell you why I am not surprised. Every single time that legislation that will actually get houses built has been before this Parliament, members opposite have voted against it. What happened to the HomeStart scheme? They opposed it. What happened to the fast-tracked unitary plan? They opposed it. What happened in terms of Resource Management Act reform? They opposed it. What happened in terms of the legislation to provide for special housing areas? They opposed it. And now I ask members opposite—and let us talk real facts—how many houses were being built when this Government came to office? The number had dropped to a low of just 12,000 homes across this country. That is the lowest level—the lowest level—of houses that were ever built in my lifetime. The lowest number ever was what this Government inherited.

Well, let us look at how much housing has grown, because, I will be frank, I am proud of my record. This is a graph of the number of houses built in every year back to 1922. In my first year as housing Minister, the number grew by 21 percent. In my second year as housing Minister, the number grew by 23 percent. In my third year as housing Minister the number grew by another 20 percent, and the latest figures show growth of 29 percent. Here is my challenge: tell me during which Minister’s watch there has been faster growth in the number—

The ASSISTANT SPEAKER (Hon Trevor Mallard): Order! I just want to ask Mr Faafoi not to bring the Speaker into the debate, especially in a disreputable way.

Hon Dr NICK SMITH: I have got a simple question, Mr Faafoi: name me a Minister under whom there has been stronger growth in the number of houses being built than over the last 4 years.

Carmel Sepuloni: Over the last 4 years?

Hon Dr NICK SMITH: Over any 4 year period—tell me a period when you have had 4 years of more than 20 percent compound growth in the house-build rate. Tell me any name in any period when there has been faster house growth than in the last 4 years. They are silent because they know there has been phenomenal growth in the number of houses being built over the 4 years. In fact, the truth is that there has been a faster increase in the rate of house building over the last 4 years than in any period, going back to 1922. There have been 29,000 homes built in the last year, and that rate continues to grow.

Then I have the contribution from the member: “Well, Housing New Zealand should get on and build some houses.” Well, here are the facts, guys: in the last year 1,100 homes have been completed by Housing New Zealand—1,100 finished; that is not consented, but finished. What was the maximum number of houses that were built during Helen Clark’s years? I thought they were the people who loved State housing. Actually, they got less than half that number. The very best number that Labour achieved in a year was 640 homes. Hang on a moment—this Government has built more State houses in the last year than any Government in 25 years. So I ask members opposite why they will not support bills that will get houses built. If they are genuine about wanting to get people out of cars and into houses, why will they not support bills before this House that will actually get houses built?

Let us be practical. I want to draw your attention to a very specific press release from Sir Noel Robinson—a very credible gentleman. He wants to build 500 houses in Papakura. Well, anybody in this House would know that that is an area where there is very high housing need. Those 500 homes will not be built—will not be built—according to his press release, without this bill. Five hundred homes, quite specifically, will not be built without this bill. Sir Noel Robinson has spent $2 million on developing his site in Bellfield Road in Papakura. He is committed to building affordable houses, and so I ask members on the opposite side of the House whether they want Sir Noel Robinson to build those 500 houses or not. In voting against this bill at the first reading, they are showing themselves to be part of the problem, not part of the solution.

I want to come, quite specifically, to the issues around the Housing Act, because Governments since 1955 have been doing housing developments under that Act. When those houses have been built, Governments of both National and Labour—and even New Zealand First—persuasions have sold those constructed houses to New Zealanders. There is some doubt—there is a question mark that has been raised—as to whether houses that have been developed by Housing New Zealand, or developed in Weymouth, or built in Hobsonville, have to be offered back to the previous owner. That would be totally contrary to what every Government has done since 1955, and I will tell you why it matters.

Right now, I am in the private market to secure partners—partners with Māori, partners with building companies—to build thousands of houses on Crown land in places like Manukau, places right through Auckland. Would a private sector partner invest hundreds of millions of dollars if there is a question mark as to whether they can sell those houses that are completed? That is why I say to members opposite that if they are serious—serious—about addressing New Zealand’s housing issues and enabling us to build houses on that Crown land, they should support this bill.

I ask members opposite where they are going to build those KiwiBuild houses they promise. Where? They have said that it will be on Crown land. If they oppose this bill, they are, effectively, saying that they would need to offer those blocks of land back to their previous owners and not be able to develop houses on them. In other words, they could not build the very houses that they promise that they will be able to deliver. So I say again to this Parliament: stop the politicking; support the policies that will actually get houses built for Kiwi families. There is only one answer to homelessness, and that is to build more houses. Parties that want houses built will back this bill.

PHIL TWYFORD (Labour—Te Atatū): Well, that was like a Punch and Judy show without Judy. That was quite a rant that we heard from the Hon Dr Nick Smith, passionately defending his record. He is much loved by political cartoonists, is Dr Smith. I think it is because drawing him must be such a satisfying task for the nation’s political cartoonists. But I am sorry to say to the Minister that he has become, really, a symbol of failure in this Government’s housing policy. He has come to embody the fiasco—

The ASSISTANT SPEAKER (Hon Trevor Mallard): I regret interrupting the member. I just do want to warn the member interjecting from my right that his interjection is a reflection on me. He is referring to a matter that is solely mine, and the width of this debate was set by Mr Speaker right back at the beginning. It was very clear that it is a broad debate. So I do not want that sort of reflective interjection, thank you.

PHIL TWYFORD: This Minister measures his success as building and housing Minister by comparing the rate of residential construction with the depths of the global financial crisis, when demand collapsed in the economy, and, basically, the building industry went dead for at least a couple of years, and many of our skilled tradespeople left the industry and left the country. That is Nick Smith’s benchmark for success: the depths of the global financial crisis.

But notwithstanding all of the bluster that we heard from Dr Smith, it needs to be pointed out that we are still building, in Auckland, fewer houses per year than were being built in 2004—fewer in Auckland than were being built in 2004, and fewer than were being built in the time of Prime Minister Norman Kirk in the mid-1970s. The picture is even more grim if you compare the current build rate with a per-thousand population. Because of the rising population, we are now building fewer houses than at many points over the last 30 years.

The Auckland Unitary Plan Independent Hearings Panel estimated recently that, under this National Government, the shortfall of dwellings in Auckland has built up to the tune of 42,000 dwellings. That is the scale of the shortage that has built up on Dr Smith’s watch. It is currently getting worse by about 4,000 a year, because only about 9,600 new dwellings are being consented annually—you can take 10 percent off that, actually, because the actual build rate is generally about 10 percent less than the consenting rate. So probably only 8,500 dwellings are being built every year in Auckland, when the city needs at least 13,000 just to keep up with population.

I want to say a couple of things about the special housing areas. Part 1 of this bill extends the special housing areas out—from the Housing Accords and Special Housing Areas legislation—by 3 years. So I want to ask the question, really: what is the benefit of the special housing area legislation? We know it is the Government’s main policy when it comes to trying to increase the supply of new housing. The special housing areas are only lines on a map—little zones that, basically, attract fast-tracked consenting. That is all they are. There is no guarantee that houses will be built, and we can see from the numbers that, over 3 years, 154 special housing areas have been gazetted but little more than a third of them, actually, have building consents being issued. After 3 years of this policy, little more than a third of them actually have building consents.

What we can see in the special housing areas is that they have actually been a magnet for land banking. They have encouraged land banking by providing the fast-tracked consenting status. By giving them a kind of special status as special housing areas, they have actually encouraged land banking. You can see one example after another of special housing area land being marketed by real estate agents for land banking—I kid you not. And what did Dr Smith do a couple of months ago when he was asked about land banking in the special housing areas? He said: “Yep, there are 14 special housing areas where they’ve been given their resource consents. They’ve got special housing area status, but they haven’t even applied for building consents.” He promised that he would write a stern letter to those land bankers and threaten them with the full force of—well, I do not actually know what he threatened them with, but he certainly sounded very intent when he was being quizzed about this on television’s Q+A programme. It turned out that he wrote only four letters to the land bankers—four letters—and if you read the letter, it was not really a threatening letter to the land bankers; it was much more of a wet bus ticket where he encouraged them to go and have a conversation with the council. That must have been pretty scary for those land bankers!

The other thing about the housing accords that we know is that very few of them have any real affordability requirements. Len Brown and the Auckland Council, basically, browbeat the Government, in the Auckland Housing Accord, into giving them the power to require that up to 10 percent of new dwellings be affordable, but, actually, in most of the other housing accords around the country—in Wellington, in Nelson, and in Tauranga—Nick Smith and his officials point-blank refused to allow affordability requirements to be included in those housing accords. So, as a result, very few affordable houses have been built, because in an overheated and undersupplied market what happens, of course, is that the developers choose to build more expensive houses so that they can make bigger profits.

So the special housing areas have been underwhelming. They have made very little difference. No one can say with any certainty whether or not they have actually resulted in a net increase in the number of houses that have been built. At best, the special housing areas might have accelerated the development of some houses that were already in the pipeline.

We would vote for Part 1 of this bill to extend the special housing areas, in order to ease the transition problems caused by the poor drafting of the original housing accord and special housing area legislation, which, as has been pointed out in this debate, would cause some cost uncertainty and delay to eight developers in those special housing areas in Auckland unless this legislation is extended. If the bill did only that, then we would have been willing to support it. It is not much, it is no genuine contribution to fixing the housing crisis, and it is resulting in very few houses actually being built and even fewer affordable ones, but we would have been willing to support it, as modest as it is. But we cannot vote for this bill while it includes Part 2, a provision that would take away rights that people have under the Public Works Act, that former owners would have, to have Government land that is being re-designated for the purposes of State housing—it is taking away their right for that land to be offered back to them.

It was very, very illuminating in the first reading debate of this bill when Grant Robertson pointed out that if there was no change required, if the Government already had that right, unfettered, to be able to use the State housing designation to either dispose of land or to use it in housing developments and not have to offer it back to former owners under the Public Works Act—if the State already has that right, why are we here? Why is it in this bill? Why is this bill being rammed through under urgency?

Jono Naylor: So that you can understand it.

PHIL TWYFORD: Well, I just think the member is being frivolous, if not insulting. There is no reason that we have heard offered in this debate, from the Minister for Building and Housing or from National Government members, why Part 2 is in this bill. The Government says it is clarifying the powers it has to do this, to ignore the offer-back provisions in the Public Works Act, but if that right already exists, if the Government already has that power, why is it legislating it? Why is it pushing it through under urgency? We believe that when you take away people’s property rights, as this bill does, then you should at least do it in a careful, deliberate, and thoughtful way and subject the bill to the normal scrutiny, expert advice, and public submissions that you get in a select committee hearing. Why is this bill being rammed through under urgency?

Finally, I want to say that this bill epitomises the kind of piecemeal tinkering that has characterised the Government’s so-called comprehensive housing agenda, which is not comprehensive at all. It is simply a whole lot of reactive, half-baked policies that are making very little difference.

ALFRED NGARO (National): I rise to take a call on the second reading of this bill. I just realised, as the member Phil Twyford was speaking—I came up with a good fund-raising idea for Mr Phil Twyford. Because of all the flip-flopping, he should have a pair of jandals called “Phil’s Flip-Flops”. It sort of goes on and off, on and off, as a fund-raising idea. Why? Because the reality is that that is what we have, even from that speech. In the first reading, Labour members stood up and said: “We oppose this bill. However, if we separate the bill, we can support the first part but not the second part of the bill.”

The first part of the bill is, obviously, the amendment to the Housing Accords and Special Housing Areas Act, which would allow for another 3-year period, and yet Phil Twyford went on in his speech to continue to bag all of the things about the special housing accord Act in itself and what it enables: the fast-tracking of consenting to allow for rezoning for those particular areas. On the one hand, Labour says it supports it; but on the other hand: “Hang on, it’s not that great. It doesn’t work. But we’ll go back again and we’ll support it.” If he would just make up his mind—but I actually think that greater than Havaianas could be “Phil’s Flip-Flops”. That is a good fund-raising idea.

That is the sort of speech that we are hearing from the other side. He knows—when it came to the LVRs, the loan-to-value ratios, he said: “Not a good idea.” All of a sudden, Labour members came in: “It’s a great idea.” Metropolitan urban limits—not a good idea, but all of a sudden it is a great idea. Devolving stock into the community housing providers—what happened? “It’s a great idea”, and then “Not a good idea.”—flip-flop, flip-flop.

This is a comprehensive plan. The special housing areas are not the silver bullet, but they add to the tool box that we know is important in addressing these issues. As for the tool box—why? The Productivity Commission report states that “consenting and the slow process, we know is critical. We know it’s not the whole but is one part of the reasons why we need to build.”

Denis O’Rourke: Table this comprehensive plan. Don’t just talk about it—show us it.

ALFRED NGARO: So, Mr Denis O’Rourke—you want to say “Show me the money. Show me the houses.”, so let us talk about this. In June of this year, 2016, the special housing areas—let us talk about the results: 1,300 homes have been completed, 2,200 building consents have been issued, 2,458 new sections have been created, and 7,170 new sections have been granted resource consents, out of the 154 special housing areas in Auckland. We know that is good news, we know it is making a difference—26 have been built on capacity of 29,800, 15 have earthworks under capacity, 5,300, and 88 are in the same stage of the planning process. That is not just talk; those are results. They are facts. That is what is happening.

I know that it is not happening faster; we want it to happen quicker as well. Actually, the points that were made by previous speakers, that only 25 out of the 154 special housing areas have not had consents or plan changes lodged, 16 of which were declared in February and May of this year—hence the reason why, when the question was “Why do we need to put this under urgency?”, we need to ensure that we extend the period of time, that is critically important to this bill, and we think that is important as well.

Here is the other thing about what it will do: it will allow for plan variation for applications that have begun but are not completed under the current Act to continue when a proposed district plan becomes operative. We know that the unitary plan, now that it has finally gone through the Auckland Council, allows for that; hence the reason why the extension will imply that as well. The other thing that I think is important, which maybe gets missed, is that it will also encourage and impose the fact that the consenting and the lodging of those consents for housing must be done within a 12-month period of time. We think that is important. It will be able to fast track the ability to say that if you are going to apply for a special housing accord area, then you need to enact that within a certain period of time. We think that is important as well.

Why the 3 years? House prices continue to rise and the supply of housing continues to lag behind demand. The extension of this by 3 years will allow for additional special housing areas to be established, and it will provide a faster housing development and increase housing supply. We think that is critically important as well.

I just want to finish off my speech here, in the second reading, by talking about some of the results that we think are critically important around this area. Again, this is part of a suite of tools that we think are important. There are 85,000 new houses to be built in this term of Parliament, and 40 houses are built every working day. When the National Party came into Government in 2008, there were, on average, 10 houses being built every day. We know that it is making a difference, exactly at 40 houses being built every working day in Auckland. This is four times what it was when National was elected in 2008. Over 2,000 homes are to be built on Crown land. We have freed up land in Auckland and in Christchurch. We know that it is making a difference. We think this is important. We see it as pragmatic.

I know that Mr Phil Twyford supports it, because he has said so. It is only the second party that does not support it. But when we talk about this bill and what it is enabling us in regard to building more—to the demand—we think it is making a difference. I commend this bill to the House.

CARMEL SEPULONI (Labour—Kelston): That speech was a little bit disappointing. I just want to point out the fact that, firstly, I do not understand what he was talking about with regard to saying that my colleague Phil Twyford has flip-flopped. He has not flip-flopped on anything. We have been quite assertive in respect of our housing plans. The same cannot be said for that side of the House. Alfred Ngaro talked about some random fund-raiser that Phil Twyford should have. Well, actually, the fund-raiser that that member has been involved in is selling our State houses. What kind of a fund-raiser is that, Alfred Ngaro? He should be ashamed of himself. I am sure there are a whole lot of people in the electorate of Te Atatū, which he is trying to win off the current electorate MP Phil Twyford, who do not support the decisions that he has made, alongside his Government, in respect of selling State housing that has been built up over generations, by generations of New Zealanders. He sold out. OK, Mr Deputy Speaker, back to the bill.

Can I just say that one of the really disappointing parts of this, given the fact that we have been given the responsibility by the public—we are elected representatives and we are here to scrutinise legislation, to make sure that we are giving New Zealanders the best deal possible. It is really concerning that we have only half a regulatory impact statement here.

There are two parts to the bill. We have made it really clear that we do not have any major issue with Part 1, apart from the fact that it has not been that effective to date, but that does not mean we would necessarily throw it out. But we do have major reservations about Part 2. The only regulatory impact statement we have is for Part 1 of the bill, which we on this side of the House would have no problem voting for if it was split off by Part 2, which actually does need further scrutiny.

I want to talk a little bit about Part 2 and speak to some of the reservations that we have. Basically, with Part 2 we are looking at the Public Works Act and the offer-back changes. Clause 10 of the Housing Legislation Amendment Bill amends section 15 of the Housing Act to state that sections 40 to 42 of the Public Works Act do not apply to the sale of State housing land. A specific subclause states that this change does not affect the right of first refusal under any Treaty of Waitangi claims settlement or collective redress Act or deed. Minister Smith has advised us that the purpose of this is to prevent a situation where the Crown develops housing on land and, upon completion, a person decides to use their offer-back rights to purchase the completed development.

The Minister has given us his assurance—I am not sure how much that counts for—that this provision could be used only for developments and would not be used for the sale of existing State housing stock held by Housing New Zealand. The Minister has argued that this change enhances the rights of Māori, as the right of first refusal is protected and the removal of the offer-back provision means that there is greater ability to negotiate agreements with Māori for housing developments.

Meka Whaitiri: How many have entered into agreements?

CARMEL SEPULONI: My colleague Meka Whaitiri has asked how many Māori, how many iwi, have entered into agreements. But I also want to say that on that side of the House the Minister is arguing that this enhances the rights of Māori. The Māori members on this side of the House, and the Labour Party in general, do not think that is the case, so we will not be supporting it. But also, let us look across the floor. We did notice, at the end of the first reading, who did not support this bill. Not only did the Labour Party, New Zealand First, and the Green Party vote against this bill at first reading but the Māori Party did too. That is the political party, in partnership with the Government, that is supposed to be advocating for Māori. So here they are saying that, actually, when they vote against it—what that says to us is that they do not believe that that enhances the rights of Māori either. We on this side of the House already knew that was the case, but it reinforces that that is the fact.

Labour has concerns that this provision will not give Māori the protection that the Minister says it does, and that the provision could be used to make it easier for the Government to go through its State house sell-off. The Government’s claim that this is merely a clarification is tenuous, given the Ngāti Whātua incident. As part of the Government’s Auckland surplus Crown land programme, the Government sought to use the Housing Act to circumvent Ngāti Whātua’s right of first refusal under the Tāmaki Collective deed of settlement. Ngāti Whātua challenged this in court, and the Government ended up settling the case in order to stop the legal action. That the Government was willing to settle in that case shows the law is far from certain, and this situation could apply to an offer-back provision, just as it could for Ngāti Whātua’s right of first refusal.

We cannot support a provision like this going through under urgency. We need it to be properly scrutinised. It is disgusting that the Government has tried to circumvent the proper process here by not allowing it to go to a select committee and by trying to wrap it up. The Government does have a habit of doing this—putting something that we will not support or that we do not want to support, and that it knows we will not want to support, alongside something that we would not mind supporting, in an attempt to try to get us to sell out and, basically, agree to the whole thing. In this situation, we are not going to do that, I say to the National Government.

We have been really sensible with our advice and with our proposal, on this side of the House, by saying to the Government to just split the bill in two. Split the bill in two, and then, even though we have some reservations about Part 1, we can support Part 1, but we cannot support Part 1 with Part 2 alongside it and with that being part of the deal. It is a dodgy deal, and we will not be supporting it.

It was disappointing to hear Nick Smith at the beginning of this second reading debate on the Housing Legislation Amendment Bill, because he seemed to take his whole 10 minutes, or at least 9 minutes and 55 seconds of his 10 minutes, just trying to justify his track record. What that says to us on this side of the House is that he is feeling really sensitive right now. I am sure that even some of his colleagues are a little bit critical of the fact that he has done very little to address the housing issues that we face in this country. I am sure that his colleagues are coming under pressure from some of their constituents as well. When looking at some of the developments that have or have not happened under this National Government, those members should be a little bit concerned about what is happening in their electorates.

Actually, it is quite timely that the New Plymouth MP is here, because one of those developments is in his electorate. Eight years ago the New Plymouth community was told that it was going to get a redevelopment, that Marfell was going to be redeveloped. Over that time it has had houses pulled out, it has got houses that have been boarded up, and now, 8 years later, nothing is happening there. Eight years later there is no additional housing. There is less housing than there was 8 years ago. When we put in an Official Information Act request to try to find out where the Government is at in respect of this housing development, what we got back was a report that says that, actually, it has decided there is no real need for any more State housing in this area and also it could not find a partner to partner with, so the Government has decided that this probably will not go ahead.

Actually, in the context of the housing crisis that we face in New Zealand, with over 41,000 people homeless, and in the context locally there, or the emergency shelter telling me it has had a 33 percent increase in the last year in people needing emergency shelter because they are homeless, I find it really difficult to comprehend that that member for New Plymouth and that National Government can say that there is no need for any further Housing New Zealand development in that area, and to leave it empty, like a ghost town. If you go there it is so eerie. We know that there are so many families that do need homes in that area, but they have been neglected by their local member, Jonathan Young. They have been neglected by the National Government, which continues to make excuses for not building houses, when all it needs to do is build them.

So my advice to Nick Smith is to get rid of the pipeline, get rid of the consents, get rid of the anger that he is clearly carrying and the sensitivities that he is carrying about the poor job that he has done in his role, and actually just get on with building some houses. That is what we proposed on this side of the House. The National Government would do itself a service if it just picked up Labour’s KiwiBuild policy.

JONO NAYLOR (National): I was privileged enough to sit down at a wedding a couple of years ago, and I happened to be sitting next to a mutual friend who was a builder in Auckland. The wedding was in Palmerston North, but he was down there from Auckland for the wedding, and I said to him: “What are the challenges that you really think are facing us, in terms of the challenges that we’re facing with rising Auckland housing prices and otherwise?”. He said it was pretty simple to him: it was the restriction of supply brought about by the changes that the Auckland City Council had made to the district plan. He said that what we do need to do is get the process moving a lot quicker, and get it so that we can actually get more houses built.

In 2013 we had the special housing areas put in place, and what that enabled us to do was—as a short-term measure at that time—fast track housing development and address those constraints on housing supply. It has been successful in that, to the point that we are actually seeing a huge number of houses built compared with what was happening before those housing areas were put in place. We have seen a huge number of consents being processed since those were put in place. It does not just happen instantly—that houses are magically built. I know that those members on the other side of the House think they can have a policy where they wave a magic wand and houses will simply appear, but it does take a process.

These special housing areas have been successful in speeding up the process. There is still a need for this to continue over another 3 years. So, quite succinctly, the primary purpose of this bill is to extend that for a longer period of time so that we can remove that constraint on housing supply in Auckland and help get this moving a lot better for those people in Auckland.

METIRIA TUREI (Co-Leader—Green): I watched the Minister stand and do quite a bit of shouting and try to justify his failures based on a reflection on history. But, of course, every Minister will stand and fall on their record, and this Minister’s record—along with the other two Ministers who are also responsible for housing. So the three Ministers in this National Government—

Marama Davidson: Three? All of them?

METIRIA TUREI: They assigned three. Well, arguably, that is why we are in such a disaster. It took three of them to create the legacy of the highest levels of homelessness we have seen in a generation—Nick Smith can stand on that record. The lowest rate of homeownership that we have seen in a generation or two—Nick Smith can stand on that record. The record high prices, where the average house in Auckland now costs $1 million—well, Nick Smith can certainly stand on that record.

Marama Davidson: Well done!

METIRIA TUREI: Yeah, well done, Nick Smith! Increasing rents to the extent that ordinary families are being driven out of rental properties and into homes in cars, and garages—Nick Smith can stand on that record. He can stand there and argue about history all he likes; New Zealand will look on his time as Minister—his history—and rightly judge his failings as a housing Minister against the record that he has created. For all of the posturing and the shouting that goes on, that is his record, and what is his response to that record? His response is this bill: a continuation of a failed policy in Auckland, and the removal of property rights from a wide range of New Zealanders, none of whom he could identify when asked about that.

So his record of failure will continue, and it would just be a usual political issue, I guess, that you would expect of this National Government, except that it is not Nick Smith who suffers; it is thousands and thousands of New Zealand families, young New Zealanders, and elderly New Zealanders, who are all looking for secure, decent, and affordable homes to live in. In a country as rich, beautiful, and resourceful as ours, this Government has somehow driven our housing to the worst possible state we could expect, where so many New Zealanders can now not afford to rent a home or to buy a home. That is the record of Nick Smith, the other two housing Ministers appointed to oversee the debacle, and this National Government as a whole.

I do want to just, in my time in the second reading—time that we would have spent, had any of this gone to a select committee, talking about the effects of this legislation on New Zealanders. We would have heard submissions from people involved in speculation: people who are developers, speculators, and investors. We would have heard from families who live around these areas who are concerned about the extent to which they were locked out of consultation because of the fast-track consent process that is built into the special housing area legislation. We would have heard from those who had provided land to the State for housing areas and other public works, who were going to be declined the ability to have the offer back—so who would not be offered back the land that they had gifted or provided to the State—and about the effect of this bill on them. We would have been able to make a much better assessment of the impacts of this legislation on New Zealanders, because we would have talked with New Zealanders about the bill and its impact.

That is what the select committee process is for. That is the core of the democratic approach to legislation that we have built in this country—that we in this room might make the final decisions, but we do it after consulting with the country, which is impacted by the decisions that we make. That is our core function as members of this House of Representatives—that we go out and speak with our people about the laws that we are intending to pass. But, of course, that is not happening with this legislation, because, despite the fact that these are substantive issues and we could have spent some time talking with New Zealanders about them, National will not allow those voices to be heard. National has shut down the debate with the public about the impact of the special housing areas and the need for real solutions to the housing crisis. National shut down—or tried to shut down—the homelessness inquiry. The Opposition took that on board itself and went out and spoke with New Zealanders, and now National is trying to shut down any real analysis of the impact of the special housing areas on New Zealanders—their failings, and even, potentially, their advantages.

So when we make decisions about this bill today, National can be assured that it does not know what the effect of this bill will be. National members will vote for this legislation not knowing what the impact will be on New Zealanders, because they have deliberately chosen not to listen to New Zealanders’ views. That is the value that the National Government holds for our core democratic processes here. The National Government does not want to hear from New Zealanders about the impact of this legislation; hence we are in urgency for this bill.

I just want to put on the record the three Supplementary Order Papers (SOPs) that the Green Party is putting forward on this legislation, as we move from this debate into the Committee stage. Just very briefly—we will go into them in more detail in the Committee stage of this bill. The first of the SOPs deletes clause 10, which is the clause that relates to the disposal of State land. That is the clause that will mean that people will not be offered back the land that they have given to the State for a public purpose. We want to delete the clause to protect New Zealanders’ property rights where they have provided land to the State for a particular purpose but this National Government does not want to give it back to them.

There is a second SOP, which amends section 14 of the original legislation. Section 14 of the original legislation defines a qualifying development. Section 14(1)(d) says that a qualifying development will not contain less than a certain percentage of affordable housing. It is a little bit oblique as to what that percentage is, and it is certainly oblique as to what the definition of affordable is. So my SOP will change the original legislation to say that, in effect, the definition of affordable housing is a price at, or less than, four times the median household income. Four times the median household income—it is described as a “median multiple” in economic language—is a way of describing affordability in a technical way. It allows for some flexibility in price because it is related both to income, the median household income, and to the price of housing. Four times the median household income has been supported, actually, by the Minister for Building and Housing, Nick Smith, as being about right for an affordable house. But there is no obligation in the special housing areas for homes to be provided at or below that price, and that needs to be changed.

Finally, the third SOP will change this bill to allow for the eight current developers and the eight special housing areas in Auckland to continue with their consent application process but will not allow for any further special housing areas to be developed. The reason for that is we must not allow this failed policy to continue in Auckland until there are provisions to stop land banking. Unless there are provisions to stop land banking, allowing more special housing areas in Auckland will simply drive up prices, create wealth for land bankers and speculators, and not deliver actual affordable homes for New Zealanders to live in.

So we have three SOPs on the Table. They deal with the core concerns that the Green Party has with this bill. We invite members to consider seriously those SOPs and to support them if they agree with us about those concerns. We will at least try to fix this legislation even though National has done such an appalling job initially. Thank you.

DENIS O’ROURKE (NZ First): I want to begin by taking a look at the speech given by the “Minister of Houselessness”, Nick Smith, because nowhere in his speech does he say why another 3 years of special housing areas (SHAs) without Government investment in land-purchasing development, in Auckland in particular, could work. Nowhere does he say in his speech how another 3 years of SHAs, while low-quality open-door immigration is taking place, could possibly work—because that is what is happening. Seventy-thousand people per year net are coming into this country—a number that is equivalent to the size of a city like Nelson coming into this country—but there is no care about the fact that they are going to drive demand for housing, drive up prices, and drive up rents. Nowhere in the Minister’s speech was there any reference to the problems caused by overseas purchasers, who, in this country, are still free to buy land, to speculate, and to land bank. Nowhere were any of those issues referred to in the Minster’s speech.

He just does not care—and the truth is that National actually has no strategy whatsoever that deals with those issues, or any other. Its members’ pretence that they have a comprehensive housing strategy is utterly ludicrous. Nobody in this country believes that, and the more they say it the more they will show how dishonest they are being about all of that—and that is the truth of it. The truth is that the National Party under the likes of Holyoake, for example, used to be the party for a “property-owning democracy”—those were his words—in New Zealand. But no more—no more. This is not that National Party; this is some neo-liberal monster that is no longer fit to govern this country.

I also want to talk about the Māori Party. Why are its members not speaking in this debate? Why is it not attacking National, and why is it not actually fighting this fight? I cannot understand that, because this legislation, which is being fast tracked today through all of its stages, is aimed at flogging off State houses and is failing to provide a strategy for the building of new homes in New Zealand, whether for purchase or for rent. It is doing so without consultation or proper scrutiny through the select committee process. So I want to hear from the Māori Party members on all of these things because I think the Māori Party is speaking, if it is speaking at all, with a forked tongue. On the one hand it promotes Treaty rights and says it will protect Treaty rights for Māori in this country, but it is failing here and now to fight against a bill that actually removes those Treaty rights because it removes the offer-back provisions, which would otherwise be claimable under current legislation. Irrespective of the Minister’s claims that that is not the case, that is actually the truth about the matter. So I want to hear more from the Māori Party members, and I want to hear them show up like the rest of us and fight against this bill. They are not doing so and I deplore that.

The Minister has also claimed that he is just clarifying the law when it comes to those offer-back provisions and he says there is no actual law change. Well, if it is necessary to pass this bill to amend the law, then—hello—it must be a law change; therefore, the Minister can only be wrong that the Minister is not attempting to change the law to make sure that those offer-back provisions can never apply. That is what New Zealand First objects to, it is what the Māori Party should be objecting to, and it is what other parties object to.

The bill is a panic measure by a Minister not on top of his portfolio—and when did this Minister suddenly realise that time is running out for special housing areas? Why, within 10 days of the termination date, is he suddenly bringing this bill to the House if there is a comprehensive housing strategy? Surely it would be a better strategy than that—if there was one—but we all know that there is not one. What there is instead is plenty of evidence of a failed strategy. In fact, there is no strategy at all and plenty of evidence of an absence by this Government of any new ideas at all. All it can come up with is an expansion of a current, failed policy, which over 3 years has actually delivered only 1,300 houses—less than a drop in the bucket as far as Auckland is concerned. So there it is: a panic measure to do little or nothing and to crush people’s rights in terms of the offer-back provisions along the way.

Just to summarise New Zealand First’s position: first of all, it believes that there is no justification for the law change—and that is what it is—to remove the offer-back provisions. There is no need for that whatsoever. All it does is to feed on this Government’s panic and need to be seen to be doing something. That is not in the interests of New Zealand; it is certainly not in the interests of people who actually might claim those rights and might claim them for very good reasons. That is what a democracy is about. It is about protecting people’s rights—and that is not what this Government is doing. It is doing the exact opposite and it is not good enough.

Secondly, the need is not only to increase the time for the SHAs to work—if they ever do—but for the Government to actually invest in the purchase of land and in the development of land, and not just leave it to private developers to do so. The reason why that is so important and why that is a core part of New Zealand First’s housing policy is that the private market will never meet the needs of New Zealanders in this day and age, as far as housing is concerned. The Government must take part, with direct investment and direct development of housing in New Zealand, especially in Auckland, so that we get enough housing, on time, in the right place, and developed in a way that people can afford, with modestly sized houses saleable at modest prices and with Government assistance to purchase.

New Zealand First’s policy is to sell sections over 25 years, allowing a purchaser to get a first mortgage to build their own home. That is just a common-sense policy—but do not ask this Government to listen to common sense. All it wants to do is to continue with its failed policies that are never going to work. So we in New Zealand First oppose both parts of this bill, unlike the Labour Party, which I now hear is quite happy to support the first part but not the second. I am disappointed in that, because I would have hoped that the Labour Party would have seen that, actually, you need to do more than just have failed SHAs; you need to have Government investment. Labour has said that; yet why did it say to this House that it would support the first part of the bill?

Phil Twyford: It’s better than nothing.

DENIS O’ROURKE: It is better than nothing? It is nothing. It is not better than nothing, Mr Twyford; it actually is nothing. So the Labour Party is supporting nothing. That is wonderful. Well, I think the Labour Party should take another look at all this. The Labour Party should take another look at why it would support the first part. We in New Zealand First do not. We will not have it. We insist on much better than that. We insist on a policy that does not just provide an extension of a time frame for a failed policy. We want to see Government investment. We want to see real commitment by this Government to housing in this country. That is why we will not support it: because we want much better. And we want people’s rights to be protected, as well. We will not vote for this bill, because it does not do either thing that it proposes to do in a way that we could possibly support, and New Zealanders should not accept that either.

Dr PARMJEET PARMAR (National): Thank you, Mr Assistant Speaker, for this opportunity to take a call to speak on the second reading of the Housing Legislation Amendment Bill. I am taking this call to support this bill. First, I want to congratulate the Minister, the Hon Nick Smith, for his dedication to improving housing supply and affordability. We know the Housing Accords and Special Housing Areas Act 2013 was meant to be a short-term measure to fast track housing development, and that is because we are committed to addressing the issue of housing supply and affordability. These issues of housing supply and affordability are not unique to us. Yes, these issues that we are facing here in New Zealand are not unique to us. These issues are actually a sign of a country doing well—a sign of a strong, growing economy. Yes, these issues are signs of a strong, growing economy.

I am a list MP based in Mt Roskill, so my interest is in Auckland. Along with other parts of the country, Auckland has made significant progress since starting its housing accord. Since the start of the Auckland housing accord, 33,000 sections have been created and dwellings consented—that is 33,000 in Auckland. So the extension of the Act is important because it is about housing supply and affordability, it is about keeping that momentum going, and it is about allowing the transition to the unitary plan in a smoother manner.

The unitary plan is important to Auckland, and the independent hearings panel did a huge job. It was a huge task. It did it in time, which was great. The unitary plan is crucial for Auckland’s future. We want to see this momentum keep going, and it is really important that we support housing supply and affordability because this industry, through construction of residential places, is not just about housing supply and affordability but is also about supporting the creation of several jobs.

If the Labour Party, the Green Party, and the New Zealand First Party are keen on stabilising house prices, then they should support this bill. On this side, we are fully committed. I support this bill and commend it to the House. Thank you.

The ASSISTANT SPEAKER (Lindsay Tisch): The next call is a split call. Marama Davidson—5 minutes.

MARAMA DAVIDSON (Green): So, yes, I am here for the second reading. I am still not supporting the Housing Legislation Amendment Bill—that has not changed.

Metiria Turei: It’s only been an hour.

MARAMA DAVIDSON: I know. Actually, by the way, before I carry on, who was it who riled up the Minister for Building and Housing? Was it you, Phil? I think it might have been Carmel or Denis. Actually, it was probably Metiria. Who riled him up? Someone riled him up. He got up and he felt it necessary to defend the houses being built and the consents. He is such a good Minister, he got up and said: “But look at the houses I built; look at the consents I agreed to.” Those are his measurements of success. Those are not measurements of success. That is not an indicator of how well our country is doing, when you get up and have a little rant about how many houses you have built—just a raw number; it was not even in any context. He did not even talk about the number of State houses that the Government has either flogged off and not replaced or, in comparison, the number that have been left to rot and are currently empty.

If we had gone through the proper democratic process for this bill, we would have heard from submitters. We would have heard from people, including those like the ones that the Greens and Labour and the Māori Party heard from in our homelessness inquiry. They were very clear when they said that all of the Government’s proposals to date, all the of the Government’s actions to date, and any of the proposals—including the little panic one we had yesterday from the Minister Paula Bennett to try to sort of make her look sympathetic to us wrapping up our homelessness inquiry—were inadequate. We would have heard submitters saying how woefully, woefully inadequate these band-aid attempts are, including this legislation.

So because we have not heard from them, I wanted to make sure that I brought their voices and their say into this House of Representatives. As my co-leader Metiria Turei just pointed out, that is what we are. We are supposed to be representative of our country, not just of developers and not just of overseas speculators, whom this Government is continuing to enable to build more wealth, while our own beautiful people, our beautiful people whom I love—do you love them, Government? Do you love our people?—are the ones in garages, crowding in houses, or just even renting homes that they could easily be shoved out of at any time. You know why? Because the housing market is amazing! Owners—because of this Government—are able to flick off a house in Auckland and also give as little as 90 days’ notice to be able to do that to any family, to any tenants, and to any renters, because they will get a massive profit. So it is preferable to be able to shove our people, our beautiful New Zealanders, out of their rental homes and out of their secure places rather than to actually allow houses to be a home where people can put down roots.

This bill does not do anything to address that—this bill does not. In actual fact, the attempt to specifically address land banking in the special housing areas only goes so far as to impose a time limit for consent applications—that is it. It does not actually put any time limit on the actual building—just for getting a consent in. It is a half again: half mop, half band-aid; a half-a-fire hose attempt at fixing this crisis.

Just very quickly, in my last minute, even the Cabinet papers admit that this was a rush, because the regulatory impact statement did not even cover the entire bill—that is how rushed this was. Also, Mr Smith, the Minister, oversold this to his own Cabinet. He said that if this bill was not rushed through, it was going to prevent 3,000 homes from being built; then this morning he had to concede that that figure was actually 2,000. What is going on? What is going on, Minister? I do not know what is going on—you are just overselling legislation to your own Cabinet. I will just leave it there. Thanks.

DAVID SEYMOUR (Leader—ACT): I rise on behalf of the ACT Party in support of this bill. Was it not fascinating to listen to the last minute of the speech by the member who just resumed her seat, Marama Davidson, when she actually got on to addressing the bill, instead of being a bundle of self-righteous fury with nothing constructive to add, no solutions, and no real understanding of what is being debated by other members?

What I would like to address is the fact that these housing markets that we have in New Zealand are dysfunctional. The number of houses built in Auckland in the past decade is 20 percent fewer than in the 1990s, despite very strong price signals that the supply of housing in Auckland needed to rise. That is a dysfunctional market. Unfortunately, over a long period of time—8 years now—this Government has done what the Government before it did: nothing substantial to change the dynamics of that market. These special housing areas, I am sorry to say, are an island of fantasy in a sea of dysfunctional markets. They symbolise a belief that the Government can somehow wish away the dynamics that have led to dysfunction in our housing markets in a few small areas, and suspend all of the things that it has not fixed anywhere else.

Of course, if the Government was serious, there would be serious Resource Management Act reforms, serious reform of the laws around building and land use planning, and a serious consideration of the fiscal incentives that councils have. At the moment, councils get most of the cost of development while central government gets most of the revenue. So it is not surprising that councils are unwilling to do, or allow, a great deal of building in their jurisdictions, or that we have a shortage of supply—an inelastic supply—of housing, rising prices, and all of the social, economic, and financial problems that that creates.

It is with some regret that we sit under urgency supporting this bill, which is really tacking on this—should we say—an island of fantasy in a sea of dysfunctional housing markets tonight, in order that we can carry on with the few projects that have actually succeeded. This is not to mention the various perverse incentives that have come out of the special housing areas to date.

Part 2 is considerably more concerning. If Part 1 is merely not very effective, then Part 2 of this bill, both in terms of property rights and in terms of procedure, should be of great concern to New Zealanders. What it says is that this Government, or any future Government—and, colleagues, sometimes that is one thing we need to think about—can take land, acquired, perhaps, under the Public Works Act for one purpose, and then develop housing on it and dispose of it without any of the normal safeguards of right of first refusal to the original owner. I am a bit surprised that the Labour Party and the Green Party and New Zealand First are opposed to that; generally speaking, they want the Government to be developing housing through any means necessary. Oddly enough, it is the National Government—from the party of free enterprise, occasionally—which appears to be proposing that the Government be able to ride roughshod over normal property rights in order to build low-cost housing.

It is a topsy-turvy world, but I think one thing that is going to be very clear is that the Committee stage of this debate, or of this compressed reading, is going to be very, very interesting. I am looking forward to seeing what Supplementary Order Papers are sitting on the Table that might ameliorate the difficulties we have, as a House, with aggregating New Zealanders’ property rights in due process under the Public Works Act in a single night of urgency, particularly when members on my immediate left think hard about what that might mean in the hands of future Governments. I am not quite sure where that Committee stage is going to land, but it is somewhere that members need to focus their attention very carefully, because to start aggregating safeguards of New Zealanders’ property rights in the middle of the night under urgency is not the way that the ACT Party believes we should be doing things in this House.

So with those comments, I will resume my seat, supporting this bill in its second reading, but I think there is the potential for things to evolve a little bit as the night goes on. Thank you.

MAUREEN PUGH (National): I stand in support of this Housing Legislation Amendment Bill at its second reading. We have heard a lot of rhetoric today, and in recent weeks—even in recent months—about the need to provide more housing in New Zealand. Yet, when this opportunity is before the House on an issue we are all agreed on, the need to provide more housing, the Opposition cannot bring itself to support a bill that provides the very tools that we will see maintaining the momentum, making land available, and getting houses built.

In a strong and growing economy, which is managed ably by this National-led Government, we are seeing more and more New Zealanders staying home and coming home—such is their confidence in this country now, and in this Government. However, National’s comprehensive housing plan is further complemented by this bill. We understand the need to ensure that this bill is passed through this House, because we want to support more Kiwis getting into their homes.

The Hon Nick Smith can be rightly proud of his role in achieving the highest number of houses being built in this country, and the passage of this bill through the House is essential to supporting more new houses for Kiwi families. I support this bill. Thank you.

The ASSISTANT SPEAKER (Lindsay Tisch): The next call is a split call. Peeni Henare—5 minutes.

PEENI HENARE (Labour—Tāmaki Makaurau): Tēnā koe, Mr Assistant Speaker. Thank you for this opportunity. I rise in the second reading of the Housing Legislation Amendment Bill. Just for a brief moment there, Mr Seymour surprised me, and I think it goes back to his days at the TDC Sawmills in Whangarei, where he actually saw the benefit of working alongside a union to make sure that he got the contract he deserved while he was working there. So when you are ready, brother, come—

David Seymour: I seek leave to make a personal explanation.

The ASSISTANT SPEAKER (Lindsay Tisch): What is the personal explanation about?

David Seymour: No one at that sawmill was unionised.

The ASSISTANT SPEAKER (Lindsay Tisch): No. No, I will not accept that.

PEENI HENARE: Thank you very much. Look, I heard the Minister this evening talk about the Acts that have happened in his generation. What that spoke to, to me, was the inability of this Government to actually look into the future for future generations. I consider the Millennials. I am one of the younger members of this House, and I think sadly about my generation, who, it is well known, struggle to get into the housing market.

David Seymour: Can we just talk about the bill?

PEENI HENARE: Mr Seymour, I would love to talk to the detail of this bill, but, having rushed through this process, I am sad to say that there is just a sheer lack of consultation, a sheer lack of strong review, to allow us to debate this properly. We have always pushed for this to go through the right process. Let us look at other occasions where we failed to go through the right process. I think about a place in Tāmaki-makau-rau. People today call it Ihumātao; its original name is Te Ihu o Mataoho. A failed process led to a long protest from the people of Ihumātao. A failed process meant that under the guise of social housing, under the guise of needing to build more homes, people had their rights transgressed—people had their rights taken away from them. The people of Ihumātao suffered from this Government’s poor process, and here we are again, going through this particular bill, rushing it through the House, not allowing the democratic process for iwi, for Māori housing providers, and for the homeless to have their say on this particular bill.

I recently asked the Minister of Finance written questions about what kind of consultation this Government had undertaken when it decided to sell off the State housing stock. “What Urban Māori authorities, if any, has the Minister consulted with in regards to the sale of Housing New Zealand properties under the Housing Amendment Act 2016?” Answer: “None,”. “What Urban Māori authorities, if any, have expressed an interest in purchasing Housing New Zealand properties under the Housing Amendment Act 2016?” Answer: “None.” “How many Housing New Zealand properties have been sold to iwi under the Housing Amendment Act 2016, if any?” Answer: “None,”.

Sitting suspended from 6 p.m. to 7.30 p.m.

PEENI HENARE: Tēnā koe, Mr Assistant Speaker. Thank you once again for this opportunity. Before the dinner break and the excellent chicken curry, I was making reference to the faults around process. I talked about the State housing sell-off and the engagement with iwi and Māori housing providers, and how the answer to all of the questions I posed was “None”—no consultation, no sales to those people.

To Part 2—and I want to pick up the point that Mr Seymour made. Actually, with regard to the Treaty of Waitangi and the right of first refusal, those who have already settled, Ngāti Whātua ki Ōrākei and Te Kawerau ā Maki—theirs are just two of the Acts of recent times that come to mind, where their rights will be protected under their right of first refusal. This House has already mentioned how that particular process was also fumbled by this Government. We know that Ngāti Whātua were refused the right of first refusal. They took that to court, challenged that decision, and the court found in their favour. Now their rights are protected, and good on them.

But I want to pick up the point Mr Seymour made about those who do not belong to those iwi collectives, those property owners who were there many years ago when their land was acquired under the Public Works Act. Where are their rights? Where are their rights? As much as I have advocated for the rights under the Treaty of Waitangi and the Treaty settlement process that takes place in this House, it is important to remember in this conversation that the housing crisis affects everybody, so it is important that we look after their rights too.

Just in conclusion, I stand here on behalf of the Labour Party, and, of course, we look forward to the next stage of this bill. Kia ora.

The ASSISTANT SPEAKER (Lindsay Tisch): I call Meka Whaitiri—5 minutes.

MEKA WHAITIRI (Labour—Ikaroa-Rāwhiti): Ā, e Te Māngai o Te Whare, tēnā koe, e ngā mema o Te Whare nei, tēnā tātou katoa. I am pleased to take a call on the Housing Legislation Amendment Bill. When I got word from our whips that we were having urgency, I was quite excited. I thought I would come down and hear that this Government is finally listening to the cries of Labour and many of the people we represent and introducing a bill that addresses KiwiBuild, for example; building a 100,000 affordable homes. I thought: “Jeez, I will be coming down and standing up in support of that, or a bill that would eliminate speculation in our housing market, maybe”—that would have been a good idea—“or what about extending the brightline test for another 5 years so we can take the pressure out of the housing market?”. I thought I was coming to the Chamber to stand up and support that. But, alas, when I came to the Chamber and read the bill, I thought: “This is unfortunate.” Generally, when we get to the second reading of a bill, we have had the privilege of taking the bill to a select committee. There are areas of this particular bill—and others have covered them; we have got two areas—where it would have been advantageous to the Government to hear from people who are most affected by this bill. This Government, the Minister himself, has denied those very people the opportunity to present, and there could have been an improvement on the bill, like many submitters actually do. But we will never know, because we are hearing this bill under urgency.

So when I look at the information we have got in front of us, I want to reference my contribution to Minister’s Nick Smith’s own Q and A on the Beehive website. Under “Housing Legislation Amendment Bill—Q and A September 2016”, a question he answers is: “Why has the Act been extended by three years?”. Of course we want to ensure there is transition coverage for those who have started the process, but I thought that if you were going to extend it, you would actually take the time to understand the extent of the problem that we are trying to fix. Under the Minister’s own question: “What happens to SHAs that have not lodged consents for qualifying developments before 16 September 2016?”, it says that those that have been gazetted before 16 September 2015 and have yet to get consents will be disestablished. Those that have been lodged after 16 September 2015 have 12 months to lodge.

That sounds all very good, but when you get down to the end of the Minister’s answer, it says this: “I have discretion to extend this time limit for new SHAs if I believe best endeavours have been made…”. That for me undermines the decision that councils have around giving those consents. Then I looked at: “Will other Housing Accords be established?”. Of course, I am a proud member of Ikaroa-Rāwhiti and we have housing issues that are real in the regions. That was the other reason why I got excited about this bill. I thought: “Finally—finally—this Government was going to deal with the issues in the regions where we are struggling to house our people.” By way of example, 377 homes in the Hawke’s Bay have been flogged off—377. How many have been built since National has been in Government? Seven—seven homes. There is an absolute need in our regions, and when I look at this bill, it does not even address the opportunities that are real in the regions. I wanted to come to this House to fly the regional flag, because this Government seems to forget about our regions.

Finally, in the minute that I have left, I want to make a short contribution about Part 2 of this bill. I support the calls from this side of the Chamber that it is too important not to go to select committee. There is only a very short explanation from the Minister’s very own question and answer around why we need to change the Housing Act. I have read the clauses in the bill. It talks about the fact that existing Treaty settlements will be protected, but what about the future ones? I listen intently to all members on that side of the Chamber to hear how we are going to safeguard future Treaty settlements under this piece of legislation. So that is why I stand in support of Labour on this particular bill. It goes well short of addressing the housing shortages we have throughout this country, and if the Government was listening, it would separate the bill and we could address it appropriately. Kia ora.

KANWALJIT SINGH BAKSHI (National): Thank you, Mr Assistant Speaker, for allowing me to speak and contribute on this Housing Legislation Amendment Bill. The previous speaker, Meka Whaitiri, mentioned that the Government does not have any plan, but I would like to clarify that this Government has a comprehensive plan to address the issue of housing supply and affordability, and the issues associated with our strong, growing economy. It is very important, we need to understand, that this economy is growing, and more and more houses are required because people are staying here.

It is important to understand that we have to free up the land so that the builders can build the houses that are much in need. With this bill, we will be able to free up more land and help builders to build a house. It is important legislation, and we are looking forward to this vote from all sides of the House, but unfortunately the Opposition is not at all happy to support such legislation. Opposition members keep complaining about it, but they do not want to support the Government when it is taking steps to address it. Thank you.

A party vote was called for on the question, That the Housing Legislation Amendment Bill be now read a second time.

Ayes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Noes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Bill read a second time.

In Committee

Part 1 Amendments to Housing Accords and Special Housing Areas Act 2013

PHIL TWYFORD (Labour—Te Atatū): It is great to be taking part in this Committee stage debate on the Housing Legislation Amendment Bill. I want to address one of the major concerns that we have on this side of the House with not only this bill but the whole special housing areas policy, and that is the very weak affordability requirements that are at the heart of this policy.

I want to address my comments to a couple of Supplementary Order Papers that are on the Table. The first is in the name of Metiria Turei and the second is in my name, and both of them make a proposal about how affordability requirements could be better incorporated into the housing accords and special housing areas legislation. But I think it is important to understand the context of this, and the context is a debate that we have been having in this Parliament for some time, really, about the best way to deliver affordability.

The Minister’s view, if I may characterise it—and I invite him to take a call on this and put me straight, if he wants to—is that the only real way to deliver sustained improvements in affordability is by increasing the supply of dwellings in the market, and in an innocent, fifth-form economics textbook kind of way, he rejects the idea that actually building homes that are affordable might help. He considers that to be, I think, an unnecessary distraction and, really, the focus should be on increasing supply. There is an irony that members will have noticed, which is that a Minister who places such great store on increasing the supply of houses has so signally failed to do that during his time as housing Minister, but what we have seen as the accords and special housing areas have been rolled out is that with the first one, the accord with Auckland Council, there was quite a lot of debate about whether there should be, in fact, the ability of the council to require that special housing areas should have to deliver a percentage of affordable housing.

There was some pressure on the Minister, I think, from within the Parliament and some pressure from Auckland Council, and at the last minute he conceded—I think it was possibly in the Committee stage or at the select committee—that, yes, the Auckland Council, under that accord, would have the ability to require that 10 percent of homes in special housing areas be affordable. We have always taken the view that that is extremely modest—in fact, far too modest—because the market, on its own, is delivering about 5 percent of new dwellings in the so-called affordable range. Students of history will know that only 30 to 35 years ago, actually, the market was delivering about a third of all new dwellings in the affordable range, and that is one of the really crucial indicators of how badly out of whack the housing market has become, because so few houses are affordable—about 5 percent. So, anyway, that was the situation with Auckland Council.

In some of the other accords—and I am thinking particularly of Tauranga—the mayor and council officials directly asked the Minister to insert affordability quotas into their accord so they could require that a certain number of homes in their special housing areas be affordable. The Minister point-blank refused. He and his officials said: “We’re not interested in that. We’re only interested in increasing the supply of homes. We’re not interested in requiring developers to provide a share of new dwellings that are affordable.”

What we know—and this completely kind of busts out of the fifth-form economics textbook from which the Minister’s thinking is derived—

Clare Curran: Year 10.

PHIL TWYFORD: —year 10; thank you—is that in an overheated, undersupplied market, developers will always choose to build more expensive dwellings because that is where they make bigger profit margins, and that is the story of Auckland in the last 10 years. If you look at the apartments that are being built in Auckland at the moment, 99 percent of them are at the luxury end of the market. Very, very few of them are affordable. If the market was in perfect balance, and if it was a perfectly functioning market, yes, the market would—

Hon Dr NICK SMITH (Minister for Building and Housing): I am happy to engage. I note that this is a bill that is going through all stages, and so I do want to be able to engage in a proper debate about the issues.

The first thing I want to challenge Mr Twyford on is that in his opening comments he said that I had been singularly unsuccessful in growing residential investment in New Zealand. Well, let me actually give the numbers from Statistics New Zealand. In my first year, 2013, the growth in residential investment was 27 percent.

Phil Twyford: It’s not all about you, Nick.

Hon Dr NICK SMITH: Well, no, I am simply saying what the record is. It is actually about building houses. I am just simply saying, let us look at the actual record: 27 percent growth in 2012; 27 percent growth in residential investment in 2013; and another 29 percent growth in 2015 and 2016. That is the longest—[Interruption] Well, I have a simple question for members opposite: cite me 4 years when there has been faster growth in residential investment. Tell me the years in which there has been stronger growth in residential construction than in the official statistics from 2013 to 2016.

Tracey Martin: We ask the questions; you answer them.

Hon Dr NICK SMITH: Oh! I am making the point that you do not know the answer. So we know now that that is incorrect, and members should stop making that assertion.

The second thing is the question of how you get affordable houses built. So let us look across New Zealand. Where are the most new homes that are being built in an affordable range? Answer: Christchurch. Actually, if you look at the figures from Statistics New Zealand, you have over 4,500 homes built in Christchurch—brand new homes built—under $500,000. Is there affordability regulation in Christchurch? No, there is not—no, there is not. I say to Mr Twyford, the Productivity Commission—not the Government, but the Productivity Commission—concluded it did not work. The independent hearings panel in Auckland concluded it did not work. Actually, the Auckland Council concluded it does not work.

So I simply challenge the member and say there is no evidence that shows that regulating house prices is the way in which we improve the affordability and supply. The best means is to increase supply. That is what this bill does. Let us be very clear in this Committee that this bill will enable Auckland to have 8,000 homes sooner—8,000 homes sooner—and it is a litmus test for parties in this Parliament as to whether they are part of the problem or part of the solution in terms of growing housing supply in New Zealand.

PHIL TWYFORD (Labour—Te Atatū): Before I was so rudely interrupted, I was saying that I think this is a debate worth having, because there is clearly a difference between, certainly, our side and the National Government benches on this question. The Minister for Building and Housing referenced the Productivity Commission, he referenced the experience in Christchurch, but, curiously, he did not reference the situation in Auckland, where not only are we falling dismally behind in supply and the deficit has accumulated, the 42,000 dwellings that the independent hearings panel estimates has built up on the Minister’s watch not only has supply been such a signal failure but also affordability has been a disaster. We can see that today with the average dwelling in Auckland—not just old Auckland City, but across the entire amalgamated city and the Auckland region—now costing $1 million.

It is an absolute disaster. There is no affordability. We desperately need more affordable housing, and I suspect that the Minister is among the kind of dewy-eyed optimists who think the unitary plan, by injecting some greenfield land into the system and upzoning to allow more density in the city, is automatically going to deliver big gains in affordability. There is a lot of smart money and a lot of urban land economists and others who are highly sceptical about that contention and do not believe that on its own it is likely to go anywhere near what is needed in terms of increasing the volume of supply. That is why—because urban land markets are so imperfect and because, for example, there are demand pressures in the real estate market—under this Government’s policy, settings are unchecked, and there are vast amounts of foreign money flooding into the real estate market. There is a whole system of tax policy and incentives that encourage the investment of massive amounts of capital in real estate speculation under this Government.

So because those things are all in place, because we have this massive accumulated deficit in the number of dwellings that are needed, and we will have for a long time to come—in fact, the Minister’s own officials say that the deficit of dwellings in Auckland will not be eliminated before 2030. That is the advice of Ministry of Business, Innovation and Employment officials released to Labour under the Official Information Act. The Minister denies it—I know he does not want to hear, because it is bad news for him—but that is the fact, and that is why Labour believes that measures like inclusionary zoning and being able to require a percentage of affordable dwellings is the sensible thing to do. If we care about affordability, if we care about making homeownership and, in fact, renting affordable, we need to be willing to intervene in the market to market to make that happen. We cannot wait until some great nirvana, decades into the future, when we have a perfectly functioning urban land market. That is certainly not going to happen on this Minister’s watch. People cannot afford to wait.

We need affordable housing, and that is why I think Metiria Turei has, very sensibly, put up Supplementary Order Paper 210, which would require a prescribed percentage of affordable dwellings and “must include a percentage of dwellings to be available for sale at a price equal to or below the price that is 4 times the median household income in that area.” Four times the median household income—I think the Minister would probably agree with that. He would agree that that is a worthy goal. His eyes are going from side to side—I am not quite sure how to interpret that—but I think, based on the Minister’s previous comments, he would agree that four times the median household income is a good thing. That is why my amendment that is on the Table would require that all future special housing areas—and it would be prospective, not retrospective—that would be enacted under the 3-year extension in this bill would be required to have a percentage of affordable dwellings.

The Minister agreed to that. He agreed to the principle of exclusionary zoning—that is, a quota of affordable dwellings. He agreed to that in the sweetheart deal that he negotiated with Auckland iwi in the wake of his vacant Crown land fiasco. If it is good enough to put a quota of affordable homes—

DAVID SEYMOUR (Leader—ACT): Can I start by correcting the member who has just resumed his seat, Phil Twyford. The policy of having a certain quota of houses for sale in a new development below a certain price level is not exclusionary zoning; it is called inclusionary zoning. Let us just talk a little bit about what that policy is and why it does not work.

The best summary of inclusionary zoning is that it is a narrow tax designed to achieve a broader public policy purpose. Let me just expand a bit on that, particularly for the benefit of Grant Robertson, who is already shaking his head with confusion, something that he has been quite used to doing throughout his life. If the Government is to make a rule that a certain proportion of dwellings within a development have to be sold at a given price, that rule will only be binding—i.e., it will only have an effect—if the price level that is set is lower than the price that the developer would have otherwise sold that particular dwelling for. The only effect of that could be that the developer loses revenue on their overall development in order to achieve compliance with the law, even though they do not necessarily achieve any wider public policy purpose.

What we are talking about is, effectively, the same as imposing a tax on a particular developer in order to achieve the wider public policy purpose of making housing available for people in all price brackets. So then you might ask the next question: what will be the effect of imposing that narrow tax on developers, the very people whom we wish to bring housing into existence in order to solve the shortage of housing? Well, we often discuss in this House the effect of taxes on behaviour, and we often hear from the other side of the House that we should have higher taxes on bad things such as tobacco because when taxes are higher, less of the behaviour that is taxed will take place.

On this side of the House, where we respect savings, investment, and hard work, we often lament that high taxes discourage those activities. But if we follow the consistency of principle that both sides of the House sign up to at different times, then having a tax on developers could only lead to—wait for it—less development. This is how stupid the policy of inclusionary zoning is. It deliberately imposes a discouragement—a tax—on the very people society needs to bring forth housing development in an effort to bring forward more housing development for the people who need it most.

Only Metiria Turei, who has just told me that she did not pay attention in fifth-form economics, could bring a Supplementary Order Paper to the Committee tonight that will have precisely the opposite effect of the intention that she purports it to have. And, as I have said in this Chamber—it seems like too many times in the short time I have been here—it is not good enough to make public policy with good intentions. Sometimes the softness of the hearts of the people making these proposals extends that softness all the way up to their heads. We need to properly analyse the outcomes and effects of public policies rather than purely their intentions, and the intention of inclusionary zoning will not be matched by its outcomes. Therefore, I cannot support Supplementary Order Paper 210, which Metiria Turei has put forward.

I will just shuffle through and see whether there are any others from Metiria Turei that I might not support. Actually, we might leave that for another call, but I hope it is very clear why I will not be supporting the Supplementary Order Papers relating to inclusionary zoning, and neither should any member in this Committee who has the best interests of New Zealanders at heart. Thank you.

METIRIA TUREI (Co-Leader—Green): Funny story, actually: I applied at my high school to do economics and they put me in the home economics class because I am a girl. So there you go. There you go, Mr Seymour. And yes, if you had known me in fifth form, you would have had a really fun time.

Anyway, I do just want to deal with Mr Seymour’s criticism and what he is saying of Supplementary Order Paper 210, which I have on the Table to require that the special housing areas (SHAs) have a proportion of building that is sold at a price that is either at or below four times the median house hold income, which is the median multiple that is used internationally as a general definition of affordability.

The reason why I think that is justifiable to require in SHAs is that those who get access to an SHA get fast-tracked consenting processes. They actually save money—significant amounts of money—and time in the process of developing that land. It is good that they are developing that land for housing, if it is required—because, remember, there is no obligation for them to build once they get access to the benefit of the fast-tracked consenting process. This Government will not require them to build. In fact, even under this new bill they are required only to make an application for a resource consent; it does not require them to get a code of compliance, which is indicative of their having built a property. So these speculators, these investors, and these developers have access to an enormous financial advantage by having their land declared as a special housing area, with no obligation to build but with fast-tracked access through the resource consent process.

What is their reciprocal obligation to the community, whose efforts—through us, as representatives in Parliament—time, and money are delivered to them for free? These developers get access to the special housing areas and the fast-tracked consents. It is a public interest that is delivered to them for free. What is their reciprocal obligation?

Hon Dr Nick Smith: They build houses.

METIRIA TUREI: What is their reciprocal obligation back to the public? The Minister says “houses”, but he is talking about houses that cost $600,000 - plus to buy. That is not in the public interest. It is delivered by the whole of the country for developers to be able to get fast-tracked access through the consent process, save money—considerable amounts of money—in the process, and still, at market rates, sell off those properties. That is not providing a reciprocal responsibility back to the public, who have provided to those developers some access to services and support that costs money and that the developers do not have to pay for.

We want to make sure that if there is going to be a gift from the public to these developers, there is a reciprocal obligation for them to provide a public benefit. One of the public benefits that has to be provided as part of any housing development process that is driven by the Government on behalf of the country as a whole is that affordable housing is built and provided. That is the whole point of the special housing areas—that affordable housing is built and provided for sale.

There is no requirement in the special housing areas policy, as it is or under this bill, for genuinely affordable housing to be provided by those developers. The Green Party says that that is part of the deal. You, the developer, get access to this special, fast-tracked process. You get to save money as you do it. You get to make money from quite a big proportion of the properties you build and sell, but you have a reciprocal obligation back to the New Zealand public, who have given you that opportunity.

Why is it so difficult for the Government to understand that reciprocal obligation? It should also be understandable by the ACT member. I know he has got a philosophy that he lives by in ACT, and it is great that ACT has got one of those—

Hon Members: Ha, ha!

METIRIA TUREI: —I did mean that nicely; it came out kind of not quite—but even in that sense, he should be able to understand that if there is a genuine balance or equitable relationship between two parties to a deal, then both parties need to benefit from that deal in a genuine way. That is part of the philosophy.

At the moment, all of the benefit rests with the developer of the special housing areas. We know that because most of the special housing areas in Auckland have not had any building on them yet. That is because land banking those special housing areas and getting the consents fast-tracked, but not building, provides those developers with a financial windfall that is delivered to them by the public.

So let us just find a way—a gentle way. It is not going to scare anybody massively. It is not going to make a huge financial imposition on those developers. It is not going to stop further SHAs from continuing. If this Supplementary Order Paper passes, it simply provides a mechanism for making sure that there is some reciprocity in this deal. That is at least the minimum that we should be requiring, as members of Parliament representing constituents who are locked out of the housing market and who are telling us every day that there is a housing crisis and that they cannot afford to buy houses when they need them. This is at least some way that we can make sure their interests are better represented. It is not complicated. It is a small amendment to the existing legislation. It makes it clear what the affordability target is, which the Minister himself has agreed is a good target: four times the median household income. He has publicly said that he understands that to be the right target.

Let us make sure that when we, as a Parliament, are doing deals to improve housing in New Zealand and to increase the supply of housing in New Zealand—as we know needs to happen—there is a clear target for what affordability means. This is so that everybody who is involved in the deals around building homes knows what they are getting into, with full disclosure about what is expected by the Government in engaging in this deal, and so that it is financially responsible—because, of course, this is not a huge imposition on those developers. It gives them an opportunity to look more comprehensively at their overall building package—how many homes they are going to build and sell for significantly more, and there will be some people in the market who can afford to buy those homes at quite an inflated price—and to make sure that they will be able to make a significant profit and keep on developing. This is not going to provide any chilling effect on these developers; it just slightly changes their price points and how they manage the properties they have got.

It is absolutely essential that we get more affordable housing, and the only way to do that is to be clear about what affordability is—which is three to four times the median household income—and to make sure that those who are getting a public benefit from this legislation have an obligation back to the public to build those houses.

More than 80 percent of Aucklanders have said that there is a housing crisis. Well over 50 percent—in some cases 60 percent—of New Zealanders say that house prices need to fall, including homeowners and including Aucklanders. We know that it is a crisis and it needs to be dealt with. This is a small change that could be made to fix at least some of the problems we have with SHAs that are not delivering. It is not expensive. It is not complicated. It is just sensible and it respects the public benefit that these developers are getting. Thank you.

CARMEL SEPULONI (Labour—Kelston): I am particularly interested in the clause of the bill that extends the Housing Accords and Special Housing Areas Act from what was supposed to be September the 19th—was it?

Hon Members: 15th.

CARMEL SEPULONI: It was the 15th or 16th?

Hon Members: 16th.

CARMEL SEPULONI: September the 16th 2016 to September the 16th 2019. I guess my real concern is how did the Minister allow it to get to this point? So, 10 days out from this particular part expiring, here we are in urgency actually having a debate about this and trying to push it through quickly. Obviously we have had 3 years to think about this, and we have had 3 years to see whether the short-term measure was going to be effective. I mean, when we look at the regulatory impact statement, it does say that it was supposed to be a short-term measure to streamline and fast track housing development and associated infrastructure through the Resource Management Act. Well, we have known for a lot longer than the last week that that short-term measure was not going to be enough and it was going to need to be extended. So I really want to know from the Minister what was the delay? What was the delay in making the decision to bring this to the House to extend this?

There are problems that have been highlighted in the regulatory impact statement in relation to this, problems with regard to what had been hoped to be achieved that has not been achieved, and it is spelt out really clearly here. It does say that “The principal issue discussed in this RIS is whether to amend HASHAA [to extend the] timeframe to allow further SHAs to be established, and to create new provisions in the HASHAA for a 12-month time limit to lodge consents within SHAs, and ministerial discretion to extend this time limit.” It basically says that there are still consents waiting that need to be put through. The Minister must have already known that they were not going to be completed by 16 September 2016, so why the delay?

I also want to point out that it is not something that has recently come to light. For the last few months at least there has been an ongoing discussion about this. I just want to refer to an article in the newspaper—[Interruption] Thank you. I want to refer to an article in the newspaper where one of our mayoral candidates, Phil Goff—who we think has a strong likelihood of winning the mayoralty—pointed out that this transition was going to be a problem. He expressed his concerns that the Minister had done nothing to deal with this transition. The actual headline is “Legal stuff up could hamper plans to build 15,000 new homes in special housing areas”. He highlighted that on 25 May, and at that time Mr Nick Smith is reported in this article as saying that the Government was: “open-minded about legislation to effectively extend the special housing area legislation but would not make a decision until it had seen the plan recommended by the hearings panel and the council’s response.”

So I would like to know from Minister Nick Smith whether or not that is what delayed him. Did he see the plan just yesterday, or last week, hence why he has had to bring this to the House only 10 days out from when it was due to expire, and why we could not give it the public scrutiny and the due process that it deserved—is that why we have delayed to this extent? I just want to know, really, what other special housing area projects are on the cards that the Government had anticipated would get through by the 16 September date that have not actually made it to that mark, so that we are fully aware of the reasons why we do need to extend this for 3 years.

I guess we do accept that, despite the fact that what the Government has done here has been underwhelming and has not achieved anywhere near the extent of what we needed it to achieve in terms of actually addressing the housing crisis, it has done something, even if it is just a little bit. For that reason, we want to support that part of the bill. The second part—obviously we will not go into it now, but we do not support it at all.

So I just want to know from Mr Smith what the delay has been and why we are here, 10 days out from when this expires. Why are we here under urgency? Why was this not brought to the House sooner? Why could we not have had a more robust, formal discussion about this?

Hon Dr NICK SMITH (Minister for Building and Housing): I do want to give a fair answer to the challenge that Carmel Sepuloni has given around the timing of the bill, and I want to take you through the process and the reason for that timing. The eight developments that are at risk and that this bill addresses arise because of two specific factors. The first is that the council and the Auckland Unitary Plan Independent Hearings Panel have chosen not to zone them residential. If it was a special housing area and the independent hearings panel and the council decided that they were to be zoned residential, there is no issue—no issue on 15 September. It is a special housing area up to 15 September, and on 16 September it is zoned residential under the Auckland Unitary Plan—no problem. The first thing is that we could not know where it was a problem and where it was not a problem until that process was completed on 19 August.

The second issue is that in each of those special housing areas, there is a legal process for the plan change, and that process for the plan change is before independent commissioners. So if you look through each of those eight special housing areas, they are being heard by independent commissioners, whom neither the council nor myself is lawfully allowed to ring up and say: “Hurry it up, come on and make a decision before that deadline of 15 September.” There are some special housing areas that, back in April, I was worried would not be through the process but actually are, and are not a concern.

Here is the further point: I think the Parliament would agree that we want these special housing areas progressed into houses as quickly as possible. The more pressure that we can put on those landowners and those councils to get on and get the plan changes and the resource consents and the houses built, I think the better off we are. If, for instance, I had come to this Parliament in April and provided a generic “get out of jail free” card and said: “Don’t worry about the 15 September date, because I’m going to extend that date.”, it would have had exactly the opposite effect that the Parliament would want, and that is maximum pressure on both the council and on the landowners to be able to do that transition.

So it is for those good reasons—we did not know where the unitary plan had completed, we did not know, in each of these areas, where they were going to be finished, and we wanted people working as fast as possible to bring those special housing areas into homes—that the timing of this bill is such that it has been brought before the House today.

IAIN LEES-GALLOWAY (Labour—Palmerston North): My question for the Minister for Building and Housing is: why is it that he is opposing Metiria Turei’s amendment to add new clause 4A as set out in Supplementary Order Paper 210? I assume he is opposing it, because I heard some of his interjections that it would not work, or words to that effect.

The only contribution we have had from the Government side on Metiria Turei’s Supplementary Order Paper (SOP) is from David Seymour, who seemed to take the view that having affordable housing, requiring developers to build affordable housing, was somehow a tax on developers and that it would stifle development of these special housing areas. He expressed that as the Government’s view—that there should be no room for putting requirements in place that affordable housing should be built on special housing areas.

I want to explore that a little bit, because if we look at Metiria Turei’s actual Supplementary Order Paper, it is to amend section 14(1)(d). Section 14(1)(d) in the principal legislation says that “a ‘qualifying development’ in a special housing area is a development— … (d) that will contain not less than the prescribed percentage (if any) of affordable dwellings.” So the legislation as it stands actually already allows for affordable homes to be prescribed in a special housing area. What does “prescribed” mean? Well, section 14(3) says that the word “‘prescribed’,—(a) in subsection (1)(b) and (c), means prescribed for qualifying developments in special housing areas by an Order in Council made under section 15(1) …”. Section 15(1) lists the criteria that the Governor-General may, by Order in Council, include in the criteria for a special housing area. Section 15(4) says: “The affordability criteria that may be specified are not limited by section 9(3)(a) but may include, without limitation, criteria defined by reference to median house prices, median household income, individual income, the median multiple (as referred to in section 9(3)(a)(ii)) or any other matter relevant to affordability as it applies to the district in which the special housing area falls,”.

So the legislation actually already takes a small step towards doing what Metiria Turei’s Supplementary Order Paper would require. The difference is, of course, that it enables affordable housing to be a requirement in a special housing area. Metiria Turei’s Supplementary Order Paper would require affordable housing to be built in special housing areas, and has a definition of what affordable housing is. If that is so evil, if that is going to stop developers building in special housing areas, then why was it included in the original legislation? If it was included in the original legislation, what does the Government have against (a) making it a requirement, and (b) setting some definition of what affordable housing is?

If the Government and the Minister disagree with the definition, which is that it should be no more than four times the median household income in that area, then what is the Government’s definition of affordable? What does the Government actually believe is an affordable home? What is the point of setting aside special housing areas if not to make housing more affordable? If the point is to make housing more affordable, then what is the Government’s definition? If it is not the definition that Metiria Turei has offered, then what is it? We have not heard that from Government members. We have not heard that from the Minister.

So I would appreciate answers to all of those questions. Why not make it a requirement? Why is having affordable housing so much of an issue if it was already included in the principal legislation? Why not have a definition? What is the definition? So there are four questions there, and I would very much appreciate an answer from the Minister to those questions, because it would certainly enlighten me as to the Government’s position on Metiria Turei’s SOP.

KRIS FAAFOI (Labour—Mana): It is a pleasure to take a call on Part 1 in this debate on the Housing Legislation Amendment Bill. I want to continue along the theme that a number of my colleagues have spoken on, around affordability. I do want to point to paragraph 10 of the regulatory impact statement, which is on Part 1, which says that three-quarters of the special housing areas require around 10 percent of homes within the development to be affordable. Either way you look at it, special housing areas are a form of market intervention, and therefore I do not think our friend Mr Seymour would agree with those.

I think we really have to question the effectiveness of special housing areas. I do pay respect to my brothers and sisters from Auckland, but there is an issue emerging in Wellington, too. I do not have a special housing area within my electorate. I know that the Government has an agreement with Wellington City Council that does not cover my area, but when you look at the market as it operates in a raw sense in Porirua, you can see the market at the very top end working quite well, if you are a developer. There are plenty of houses in some new developments in Porirua that are around the $750,000 to $1 million mark. [Interruption] Yes, that is right. If you are in that area of the market, construction is going well—that end of the market is booming.

But if you are at the affordable end of the market—and you can look at defining that however you like, and I do acknowledge Supplementary Order Paper (SOP) 210 from Metiria Turei—there is nothing available for you. In theory you could claim that the special housing areas would be able to come in and make a difference, but as we have seen in Auckland that is not the case, and we seriously question whether or not the affordability percentages around the special housing areas are having any effect in Auckland and, if they were to come further south, what they would do to a market such as Porirua.

At the moment in this region we have got around 460 empty State homes. In my particular area of Porirua there are 126 empty State homes, along with large swathes of land that used to have State homes on them that the Government demolished. It promised to return some homes to those areas, and has not done a single thing.

David Seymour: Halfway, mate.

KRIS FAAFOI: Mr Seymour has got something to say about that; I do not think it would be helpful. So we have got a market in Auckland that is not working, and a market in other areas of the country that is not working. Although we support the extension of the special housing areas, I think we have to take a good, hard look at the effectiveness of these special housing areas and look at just whether or not they are working and whether we have got a large enough percentage of those affordable homes being built for Kiwis.

I do remember at the beginning of the process of the Aotea block being built that there was a proposal that a certain percentage—larger than 10 percent—had to be deemed affordable. That did not happen. What you have got now is that people who have got plenty of money are fine in the Porirua market, but people who have got no money are struggling to get into the property market to buy a house or even find a house to rent in the private market, and there is almost nothing available in the Housing New Zealand sphere. Of the 42 houses that are available in Porirua at the moment, I cannot see why those houses are not being given to families that are on the waiting list. I believe the waiting list as it stands, which was cut down about 2 or 3 years ago, is about 60 families. So we have got empty homes in Porirua and 50 or so families that desperately need them.

I think the extension of the special housing areas might be something that the Government is trying to do to make more affordable homes available, but it is certainly not meeting the demand from those people who want affordable homes. I would suggest that this Committee looks really closely at SOP 210 from Metiria Turei, which defines affordability. Mr Seymour does not like it because it is a market intervention. But if you look at it, if you look at how the market is operating now, it is not working for all New Zealanders. It might work for Mr Seymour and his friends.

Grant Robertson: It’s not working for him.

KRIS FAAFOI: It may not be, but it is certainly not working for all New Zealanders. So we have got some serious concerns about Part 1 of the bill and the effectiveness of the special housing areas. We have got even more concerns about Part 2, but we will come to them when the time comes.

DAVID SEYMOUR (Leader—ACT): I believe I may be able to assist with some of the points raised. I do not know whether I will be able to make it simple enough for a King’s College old boy, but I am certainly going to try my damnedest.

Iain Lees-Galloway: Jealousy will get you nowhere.

DAVID SEYMOUR: Jealous of what? The issue at hand comes down to a clash between two similar but really quite different concepts. One is affordable housing, and the other is housing affordability. On the one hand, when you talk about affordable housing you talk about a certain number of homes being available at a price for a segment of the market. Many of the interventions that are proposed by the political left are what I would refer to as affordable housing initiatives. Let us have inclusionary zoning to try to section off a part of the market at a certain price. Let us have the Government, or some Government-related entity, develop housing, because it will somehow have different means and motives from the private sector.

Denis O’Rourke: Exactly. What’s wrong with that?

DAVID SEYMOUR: Let us have some sort of subsidy for people to be able to afford housing. Denis O’Rourke—not much gets past Denis O’Rourke. I told the Committee that I was describing the policies of the political left, and Denis O’Rourke has correctly surmised that I am describing his policies. Not much gets past Denis O’Rourke.

The problem with the affordable housing agenda, as opposed to housing affordability, is that you cannot have affordable housing without housing affordability. The reason housing becomes unaffordable in the first place is that there is a shortage of housing supplied to the market, and when that happens, inevitably there is going to be a bidding war, which those with the least income are going to lose. Until housing becomes affordable you are not going to achieve housing affordability.

What will it take to increase the supply of housing supplied to the market, and therefore achieve housing affordability across New Zealand, and therefore make it possible for there to be more housing that is affordable for those with the lowest incomes? It is interesting to hear Metiria Turei referencing the median multiple measure, which is a measure that has been popularised by my good friend Hugh Pavletich from Christchurch, who is one of the co-authors of the Demographia survey.

I wonder whether Metiria Turei has carefully read those Demographia surveys, and I wonder whether she has spoken to Hugh Pavletich or Wendell Cox. I wonder whether she has discussed with Julie Anne Genter what she has read. What those reports say, in no uncertain terms, is that the reason we have a shortage of affordable housing in New Zealand, as with any other market, is that we have adopted land-use planning laws that constrain the amount of land upon which people are able to build, thereby leading to a shortage of housing, thereby leading to a bidding war that not everybody can win, and those with the least money end up losing and end up with a shortage of housing that they are able to access.

The economics of it are that simple, and it is very good to hear that Metiria Turei has become a convert to this line of thinking, referencing the Demographia International Housing Affordability Survey—something that those of us on this side of the House have long looked to as a guide for making better housing policy. But if we wish to follow in those footsteps, we need comprehensive reform of New Zealand’s land use planning laws. It is not good enough that councils are able to draw a line around a city such as Auckland, such as the metropolitan urban limit, and say: “Thou shalt not build beyond that line.” That has created an enormous shortage of land, which has created an enormous shortage of housing, which has left people unable to afford any home whatsoever.

Finally, we must reform the way that we do infrastructure funding. Presently, the councils cover too many of the costs and central government gets most of the fiscal benefit, and that is why councils are unwilling to build more housing. What this Government really needs to do is reform those underlying fundamentals, not tinker, as Metiria Turei has suggested in her amendment.

GRANT ROBERTSON (Labour—Wellington Central): I feel like the parent who has to do the thing that they never ever want to do—to sit their child down and say: “I am sorry, there is no Santa.” So for David Seymour’s benefit, this is the ACT Party equivalent of the difficult parental conversation: the market is broken. It is completely broken. It is not delivering housing to the majority of New Zealanders who want to buy it. It is broken—it is completely broken—so standing up and making semantic arguments about the difference between affordable housing and housing affordability is just perpetuating the purist model that I know David Seymour believes in. I know David Seymour believes in this as an article of faith, but Mr Seymour actually needs to look around and realise that the market is broken. It is not delivering housing affordability; it is not delivering affordable housing.

Bill English, the Minister of Finance, stood up straight before the Budget and said that in the last 10 years, only 5 percent of new builds have been affordable. He acknowledged it. It was interesting that while Mr Seymour gave his first intervention this evening, Nick Smith was in the chair saying things like “He absolutely is right.” and “Hear, hear.” when David Seymour said that there was no place for an affordable housing requirement within special housing areas, which seemed a little odd to us on this side of the Chamber because it is already in the Government’s law. In fact, they have got a requirement for 10 percent affordability in Auckland now, so it is a little odd for Nick Smith to do that.

He then followed it up, brilliantly, with another intervention—I think it might have been when Iain Lees-Galloway was talking—saying: “It won’t work. It doesn’t work.” Well, it is in his law. Why is it in his law if it does not work? The point is that it is not working because the whole special housing area process is not working. That is the problem. We have got only 57 of the 154 special housing areas with anything actually happening—even remotely close to happening—on them, so the problem here is that the market is broken and it requires an intervention. That is the problem that David Seymour has.

It is surprising that the Minister is not prepared to back the Supplementary Order Paper (SOP) in Metiria Turei’s name, because he himself has already started the ball rolling here. We need these special housing areas to be delivering a range of housing, because what we want in New Zealand are communities to develop that are not ghettos, that actually do provide opportunities for people to live in cities close to where they work, and that are not only for those who are the very, very wealthy. That is not what New Zealand was built on. If David Seymour has got a big problem with all of this, he needs to go to any public meeting in New Zealand, which are mostly attended by slightly older New Zealanders, and say “Who in this room got their first house through a State Advances Loan?”, or “Who got their first house by capitalising the family benefit?”. Successive Governments have intervened in the housing market to give New Zealanders a fair go at the Kiwi Dream of owning their own home, and that is what needs to happen here. Here is an opportunity to do that.

The ultimate way to do this, Mr Seymour, is actually a programme where we really intervene in the market to fix it, which is KiwiBuild—where the Government leads the housing development programme of affordable housing, where we do not just leave it up to the private developers, and where we actually say: “Here is a chance for the Government to show some leadership and develop affordable housing.” For the special housing areas, we do not know what the counterfactual is in terms of how many of these areas would have been developed anyway. I know here in Wellington when you look at the list of special housing areas, most of them are ones that were already under way or would have been developed anyway. But we are prepared to give it a go. We are prepared to say: “Yep, let’s get in behind the special housing areas and see whether we can make them work a little bit better.” But they are not going to work to deliver affordable housing unless we actually commit as a Parliament to making that happen.

That is what this SOP is about. That is what the Government should be delivering on. It has already got it in the legislation for Auckland, so let us make it possible for everyone around the country.

ALFRED NGARO (National): I have to say that at the beginning of that speech by Grant Robertson I felt like I was in a bit of a whānau family moment, but happy Father’s Day. I know that you were making out that it was like sitting down your son, and you were doing this to David Seymour. I was not sure what was going on there, but obviously you wanted to school him in what you believe your facts say—what your belief is.

I just wanted to respond to some of the comments. Mr Robertson talked about the capitalising of family benefits. I have to say that my family works for one of those, but if we look at the history of that, it actually was initiated in 1956. I ask the members on the other side whether they remember when it was taken out—1986. Do you remember when that was? [Interruption] OK. It was actually under a Labour Government, with David Lange, and that is when it was removed. So if you are going to use that as a point of difference, just remember to remind yourselves of your history and your heritage—where you actually come from. It was taken away under a Labour Government.

But the conversation has been around affordability, so we can talk about semantics—and I actually agree with my colleague Mr David Seymour in regard to inclusionary zoning, which is what he talked about. Let us talk about some of the facts, then. The Minister used the example of what was happening down in Christchurch previously. I can remember the wailing and the gnashing of teeth in this House when talking about affordability in Christchurch. We know that rents were high, affordability of housing was in a terrible state, but the intention of this Government, of course, was to ensure that we built to the supply, to meet the demand—these are the facts of what we are talking about.

The CoreLogic sales data in regard to home loans and price caps for the existing sales—I will go straight through to the facts of this. This was on 31 March 2016: out of the 7,889 homes sold in Christchurch, 5,009 homes—63 percent—were sold for under $500,000. That is right. That is what the number is. In fact, if you go further along, the 5,652 that sold for under $550,000 were 72 percent of the market. That is right. There is the silence of the lambs, because we know we did not regulate the market then and there was no inclusionary zoning. Instead, there was an intention to ensure that we built more to meet the demand. We built more to meet the demand, and you cannot argue with that because those are the facts, that is the reality, and that is what we are doing. The reality is that the special housing accords approach is not the silver bullet. It is one of a range of initiatives that we believe are important to ensure that we meet that demand. We know that is what is important.

There was some response in regard to consents, and every time we talk about the number of consents that are out there, which this Government is putting through—we think that is important and we use that as a basis. I want to dispel some of that myth. It was surprising to see, firstly, why would those developers want to spend $10,000 for a building consent and not proceed to build? We think that is important. The special housing accords will ensure that there is a time limit to ensure that they apply for a building consent. If you are spending that amount of money, then the intention is that you will do this. But the census data actually proves this. The number of dwellings in the Auckland regional area from 2006 to 2013 under the census data was 33,777. So when we look at the number of consents, 32,419 falls about 10 percent below that. But if we look at the 6-month lag and we bring that up, that is 33,703. I believe that that addresses the issue, which is that the consenting is a good indicator of the fact that not only does it allow them to build but it ensures that they will build. I think that is critically important as well.

I just want to finish off with the facts and figures again. If we look at the numbers that are there in regard to March 2016, these facts are actually hard to argue with. So for affordability, of 31,963 houses sold in the Auckland region, 30 percent were sold under $600,000—9,638—and 11,840, which is 37 percent, were sold for under $650,000. There is an affordability margin there. Of course we want that to grow, and hence the reason why we are focusing our attention on building more for the demand. Then we believe that what will happen is that we will read out those statistics just like they have been now in Christchurch. Sixty-three percent of the market is affordable. We believe that is important.

POTO WILLIAMS (Labour—Christchurch East): I just want to perhaps get some assistance. I just want to walk through this a little bit. We are talking about special housing areas, where developers are provided with an opportunity to fast track consents. The notion of fast tracking consents would necessarily mean that you could fast track the building of homes—is that right? Am I correct in assuming that the fast tracking of consents by developers means that you can fast track the homes? That is not a difficult assumption to make.

So what I would like to know is this. Of these special housing areas—which have been in existence for about 3 years, which is why we are in urgency right now to pass legislation so that they do not expire—how many houses have been put through the process where the developers have got the consents and they have actually built the houses?

Denis O’Rourke: 1,300.

POTO WILLIAMS: Wow! That is amazing! How fast is that? So in 3 years, with this fast-track process, we have built 1,300 homes. That is amazing! And do you know what else—

Kris Faafoi: Slow down!

POTO WILLIAMS: Yeah, you are moving too fast! Do you know what else is amazing? What else is amazing is that the Minister the Hon Dr Nick Smith—or whichever way the honorifics go—talks about the affordability issue in Canterbury having been wiped out, because the three-headed housing monster over there has been pulling all these levers in Canterbury. I welcome the National Canterbury MPs getting up and challenging this—that the three-headed housing monster has been pulling all these levers in Canterbury and making houses more affordable. The Minister is saying that the Government has intervened in Canterbury and made it more affordable for housing. Well, I just have to challenge that because actually it was Rūaumoko who did that. Rūaumoko was the one who intervened in the housing market in Canterbury and made it more affordable because we got all this insurance money. We got all this insurance money to rebuild our homes.

So when the Minister talks about the Government and its special housing areas in Canterbury—well, we had our leader, Andrew Little, down there only a few weeks ago looking at one of those special housing areas, and what was it?

Hon Member: Bare land?

POTO WILLIAMS: It was a vacant lot.

Carmel Sepuloni: Special.

POTO WILLIAMS: It was very special. It was so special that there were ghost houses on it. So when this Government claims that it has intervened in the Canterbury housing market and brought back affordability to the people of Canterbury, I say no, that is rubbish. It was Rūaumoko who did that, and the insurance companies.

I ask the Canterbury MPs over there on that side of the Chamber to get up and tell me that that is wrong, because that is blatantly not wrong. That is so, so not wrong. When this Government claims affordability in Canterbury, I have to get up and challenge that member on the other side of the Chamber Alfred Ngaro, when he claims all these statistics, which are clearly, clearly not right.

And who has the oversight of these developers? There is an example; I want to quote from my own electorate, where developers have been given carte blanche to redevelop Housing New Zealand land. They have taken one property out and they have put five, or six, or 10 properties in. Because we have fast tracked this, because we have given developers a whole lot of power under this legislation, who has the oversight of these developers?

The example I want to quote in my electorate was where a developer was not given any oversight. He built some homes that sat outside of the boundaries of the recession plane, and do you know who discovered that? It was not the council, it was not Government officials, it was the local people who looked at those buildings and said: “Hang on a minute. There’s something not right about this. The sun’s not getting into my backyard like it used to. This building is clearly, clearly outside of the boundaries of this.” So we are expecting developers to actually have oversight of their own developments. In this case, what happened was that building actually had to be taken down because it sat outside of the council consent process. So we have got a cautionary tale right there in Christchurch East—in Christchurch where this Government claims it has intervened and brought affordability back to our housing market, which is clearly not right. So I really challenge this Government to actually live by the affordability.

JULIE ANNE GENTER (Green): I am very happy to take a call on this bill. The Green Party believes it is a fundamental right for every person in Aotearoa to live in a warm, dry, secure home—or have the opportunity to—a place that a family can count on, whether they own or whether they rent, to be their home as long as they wish to be there, and it should be affordable.

In the debate this evening there has been a lot of talk about what it is that affordability means—affordable housing, housing affordability, what is the difference? I think it is pretty clear. We do not have to make reference to the median multiple. If people have to spend more than 30 percent of their income on housing, that is not affordable. So it is not about just first-home buyers, although that is important too. It is about people having access to a place to call home without having to spend more than 30 percent of their income, so that they have enough for all the other things that every person needs to live a good life in this country. The problem right now is that there are too many people for whom this is not available. They have to spend far more than 30 percent of their income to have a place to call home. As we have been hearing over the last few weeks, during the homelessness inquiry that the Labour Party and the Green Party have been running together, there are too many families, young families, and women, and too many vulnerable people who do not have a place to call home, and that is not right. It is not good for any of us in this country.

This National Government has been irresponsible. The National Government members cannot blame anyone but themselves when they have been in power for 8 years and house prices are completely out of control. Homelessness is at a record high. They cannot point the finger at anyone but themselves. The reason why we do not have affordable housing is that some people in this country are making a lot of money from buying investment properties. They have got no incentive to rent them out or to do them up. Land prices are increasing so fast that they can just buy a house, hold on to it, and make hundreds of thousands of dollars on which they pay no tax. That is not fair and it is not right, and this irresponsible National Government has done nothing about it because those are the people it represents—the people who are making a lot of money off investment property.

You know, under the National Government, not only is it not easier to buy a first home but it is a lot easier for those property investors to buy a third or a fourth home. The numbers show this: 5 years ago 36 percent of property investors owned three or more properties. Today it is 51 percent of investors who own three or more properties. So people are able to buy houses, but not everyone has access to an affordable home, and that is not right and not fair.

There is a whole range of policies that we need to implement to achieve affordable housing in New Zealand. One of them is social housing. It is not rocket science. The Government needs to build more State houses, and everyone in the Opposition has been talking about this. We need to tax all income the same. Capital gains tax—it is fair, and it is only right. Those two things alone are not going to solve the problem.

Although there is a lot of talk about supply, and supply is an issue in some places like Auckland, the reality is that foreign capital is impacting house prices in cities all across the world, and it is really ridiculous for the National Government not to acknowledge this. Basically, in all of the current account deficit countries, of which New Zealand is one—New Zealand, Australia, Canada, the US, the UK—they have had huge housing bubbles. In the current account surplus countries they have had flat or very slowly rising house prices. This is because a disproportionate amount of the foreign capital we attract is going into real estate, which is not the productive side of the economy that we need it to go to, and it is making housing less accessible for people who live here in New Zealand. It is not just foreign buyers, although that is part of the issue. The reality is a lot of New Zealanders are accessing foreign capital to get mortgages to buy houses, and that bids up housing prices. You can see this in a place like Vancouver, which is very similar to Auckland. Suddenly it has had a big drop in house prices because it put a 15 percent tax on foreign buyers.

DAVID SEYMOUR (Leader—ACT): Thank you, Mr Chair, for this opportunity to address some of the comments made by Grant Robertson, I think, who, sadly, will not be able to hear my comments. Hopefully, he is listening on his crystal set at home. He took it upon himself to tell me that there is no Santa Claus. What a cruel, cruel man is Grant Robertson! But the reality is that there is a Santa Claus. There is a market and, overwhelmingly, it works. If you want to question that, then the first thing you might ask yourself is why it is that the cost of goods that people consume, whether it be cars, whether it be electronics, whether it be clothing, or whether it be food, has gone down relentlessly in real terms, for decades and decades and decades.

There is one asset that people choose to consume in New Zealand that, strangely enough, has not gone down in real terms, and that is housing. You would have to ask yourself: what is different about the housing market from every other commodity that people like to consume? I will just give you a suggestion that there is no other market that has more intervention by councils and the New Zealand Government than the housing market, because all of those other things I listed are things that can be produced offshore and imported, and that is why we have a competitive market the New Zealand Government cannot touch.

But what the New Zealand Government is able to touch is the infrastructure and the regulatory environment surrounding land. Those are the things that are regulated by the Government, where there is extensive Government intervention, and, strangely enough, we have found ourselves with a great shortage of that commodity, and at the same time steadily rising prices, which is what has occupied most members and much of the New Zealand public for some time now.

So here is the world that works: free markets providing many of the things that we consume, with continually dropping prices and increased welfare for citizens. Here is the world that does not work: the world that is regulated and monopolised by Government, and that is access to buildable urban land and the infrastructure to service housing. That is the world that does not work, and that is the world where we have had increasing prices and a shortage of supply. If only members opposite were able to understand these simple distinctions between a free market and a market where the critical inputs are regulated by Government or monopolised in their provision by local councils.

Of course, if it is a Government failure that has led to our difficulties with housing affordability, then what needs to be done is that the Government needs to change its policy approach to those areas of the market that it dominates. This Committee needs to be debating legislation to seriously reform land-use planning, particularly in urban settings. It is not good enough that our Resource Management Act has grown from 400 pages to 900 pages in the last 25 years. It has simply become more complicated. Only Grant Robertson, only the Labour Party, would believe that an activity governed by 900 pages of legislation—the purpose of which is just to set out the rules for another level of the Government’s interventions—was a free market.

When we do development, we need infrastructure, and the roads and the pipes that make up urban infrastructure are extremely costly to councils, yet the development that councils are in charge of consenting is extremely profitable to central government. We need to renegotiate the deal between central government and local government and actually share revenue to incentivise councils to consent more land. That is the public policy prescription that New Zealand needs. We do not need to fix the free market where it operates. We need to make the inherently interventionist housing market more efficient, and that requires better Government policy. There is a Santa Claus.

ANDREW LITTLE (Leader of the Opposition): The only assertion that comes close to having an evidence base to it in Mr Seymour’s speech just now is his statement that Santa does exist. We have heard a lot about this free market. There are some things about the free market that Mr Seymour has not articulated that I will come to, but perhaps I could reassure Mr Seymour this way: although it is official Labour policy that Santa does not exist, there is a possibility that there may be fairies at the bottom of the garden, and I am prepared to concede that point.

The thing about free markets is this—if you want to have a free market there are a number of other conditions that have to apply, such as symmetry of information and equality of power, and that includes financial power as well. The reality is that in our housing market right now there is not equality of bargaining power through equality of financial power, there is definitely not symmetry of information—there is asymmetry of information—and all the evidence that is available to Mr Seymour, and everybody in this Committee, and the rest of New Zealand is that our housing market is just dysfunctional. How is it that in a country of 4.5 million people, in a city of l.5 million people, and when the average income is, what, $55,000, $57,000, we have an average house price of $1 million? That is not the mark of a functioning market; that is the mark of a dysfunctional market. So interventions are required.

You could say the Government has heroically embarked upon housing accords and special housing areas as a justified intervention in the market. Certainly the objectives were good. Certainly the intentions were good. But, actually, when you look at the evidence and the practical effect of those special housing areas so far, they are not achieving what they were intended to achieve. Roughly a third of the special housing areas—only a third—have had houses built on them, which means two-thirds have not. We know that in special housing areas, set aside for the building of houses, including affordable houses—it simply has not happened in two-thirds of the special housing areas and the land available in those housing areas.

The policy is not working. Noble as it is to say “Listen, let’s extend it. Let’s give it another 3 years.”, that will be meaningless without Supplementary Order Paper 210 advanced by Metiria Turei requiring and specifying a proportion of affordably priced houses in those areas. That is vital—that is vital. That has been the missing element in the special housing areas programme so far.

There have been some great projects in which affordable houses have been delivered, and some of them have been in special housing areas, and others have not. The truth is this—the reality is this—the need for affordable housing of a huge volume is now urgent. We now need urgent action to get affordable houses built. Getting special housing areas working properly, and a policy working properly, could be a solution. But it will be a solution only if they deliver affordable houses. It will not be a solution if we just extend the period during which special housing areas can be created and housing accords can continue to be activated, without a statutory mandate for a proportion of those houses to be affordable. That is what is needed.

That is the Labour Party policy proposal. That is the Labour Party comprehensive housing package—to have a housing programme dedicated to affordable housing. That is the desperate shortage in New Zealand at the moment. Young couples, no matter how hard they work or save, cannot afford to buy their first home, and how could they when the proportion of their income—or the multiple of their income—required to buy a house, at least in Auckland, is now pushing 10 times that income? It is out of reach. If we are to stave off a bunch of other social issues, or social problems, further down the track, then the need to get affordable houses built in New Zealand today is utterly urgent.

The bill as it stands at the moment, in this part, in Part 1, does not go far enough. We need a specific mandate, as provided for in the Supplementary Order Paper, for a proportion of affordable houses.

Hon Dr NICK SMITH (Minister for Building and Housing): I do want to respond on three important points. The first is that members have claimed that you need to get the house price to income ratio back to 4, as is proposed in the Supplementary Order Paper (SOP). I challenge members to reflect on the history. There is actually only one period in New Zealand in which that ratio was less than 4, and that was when interest rates were at 15 percent.

Jono Naylor: How high?

Hon Dr NICK SMITH: Fifteen percent. That is the only time. So the point is this: actually, you need to include interest rates in your measures of housing affordability, because, actually, whether it be the interest.co.nz index, or whether it be Massey University’s index, it is absolutely proper to look at the proportion of a person’s income in that criteria for affordability.

The second thing is that there is a belief from Opposition members that putting an affordability criterion into each of the special housing areas (SHAs) will help. Let me tell you why that is incorrect. The experience that the Auckland Council has had, and the reason that the Auckland Council decided not to include affordability requirements in their plans—

Andrew Little: They got it wrong.

Hon Dr NICK SMITH: I will explain why. It is important. It is because the developer has a choice as to whether they use the SHA mechanism or the normal planning process. If you put a whole lot of barriers in the way of the special housing area, the developer will simply choose to use the normal planning process, and you will defeat exactly what you need—more houses being built.

Phil Twyford: So apply it to all developments then.

Hon Dr NICK SMITH: Then Mr Twyford says: “Well, let’s just apply it to all developments.” I draw his attention to the evidence and the decision of the independent hearings panel, and I think every member in this Committee would accept the judge in that panel as an expert. Equally so, I would refer to the reports of both the OECD and the Productivity Commission that say those measures do not work, are counter-productive, and actually make houses less affordable, and the evidence is absolutely strong on that—

Phil Twyford: Rubbish! There is no consensus on that.

Hon Dr NICK SMITH: Effectively, what Mr Twyford and Mr Little are saying is “No, the Productivity Commission got it wrong. No, the independent hearings panel got it wrong, and no, the Auckland Council got it wrong.”, whereas the Government is saying: “Actually, the research shows it does not work.”

Let me give a very practical dimension. The original Auckland Council proposal was that if a housing development was more than 20 houses, it required a block of affordable houses. What the developers who were doing an 80 section block did was divide it into 19 section lots to be able to avoid that provision.

Phil Twyford: There are ways of dealing with that.

Hon Dr NICK SMITH: And he says: “There’s ways of dealing with that.” Actually, when you come to do a housing project, it is often the case that you will slice it up because of the capital costs of doing the investment.

I will respond to one last point. The members have said: “Why is it that the Government insists on price points and affordability on the Government’s Crown land programme, but not in the special housing areas?”. There is a very good reason for that. When the Government owns the land, it can set the conditions about what occurs on the development, but if the land is privately owned, actually, you cannot force people to invest. If you have got a block of land, for instance, that is typically worth $10 million, and it is going to cost $30 million to build the infrastructure and to convert that into sections, I challenge Labour members to say how you will force people to invest that $30 million. That question they cannot answer. That is why those provisions do not work. That is why, actually, increasing housing supply is the key. This provision will do that, and Labour’s opposition to these provisions shows that it is more interested in playing politics than actually getting roofs over the heads of Kiwi families.

DENIS O’ROURKE (NZ First): I want to begin by making some comments about what the “Minister for Houselessness” said about affordability of housing in Christchurch because it is a most inappropriate example to use. As some others have indicated, the reason is that in Christchurch, as a result of the earthquake, huge amounts of Earthquake Commission and insurance money went in, and, as a result of demolitions, there was a lot of land that became available for building both in the central city and in the east. In addition to that, a lot of people simply moved out of Christchurch to areas immediately next door, like the Selwyn and Waimakariri districts. So the issue in Christchurch was not so much a land supply problem; it was actually, much more, a house supply problem because land always was, and still is, available. So you cannot use the Christchurch situation as a valid example of proving the effectiveness of Government policy. It is just not applicable.

What is applicable and what is core to this issue is affordability, and that cannot—and I challenge the Minister for Building and Housing on this—just be solved by supply of land. There is a lot more to it than that because affordability refers to appropriate-sized sections for modest homes at prices that people can therefore afford. What is actually happening as a result of the free-market approach—which is really the approach supported by the Government—is that developers like to build larger homes on large sections because they get larger profits from doing it. It is no good the Minister shaking his head, because I have looked around in all parts of New Zealand, especially in Christchurch where I live, and tried to find a modest-sized home on a modest section for a reasonable price. It is very difficult to do. What is available are plenty of large expensive homes on large sections. So the market does not really solve the affordability problem as a result of just opening up supply.

Affordability also refers to access to terms of purchase that people can handle, and that is the thrust of New Zealand First’s policy. It divides the purchasing of a section—that we would assist them to do—with the building of a house, and if the security for the section is at second priority, people can still go out, therefore, and get a loan for a house on first mortgage and build their own home. That is the approach that we want to take. But affordability also—and this what the objective is of some of the Supplementary Order Papers that we have before us—applies to the total cost, whether it is within the range of people to finance or not. It is really as simple as that.

Now David Seymour seems to think that the market will look after that as well, but that is not true—that is not true. There are so many people in this country who will never be able to finance their own home under current conditions. It is not just a supply issue; it is beyond that. It is an affordability issue. So just extending the time for special housing areas (SHAs) is not actually going to be enough at all. So I would like to ask the Minister: why has the Government not done more than just extend the period for SHAs in this legislation when there are so many other things it could do, not just to assist supply but to assist the problem of affordability?

For that reason New Zealand First will support Supplementary Order Paper 210, because we would support anything that would assist that issue, although we do think that our policy is better than that set out in Supplementary Order Paper 210. Nevertheless, it is doing something positive, so we will support it.

The Government, obviously, has no better ideas. It is just going to vote against that but not put anything in its place, and that is unsatisfactory. David Seymour seems to think that the market is going to be enough and the market will look after everything—just give them a free hand and away they will go. That is no way to address affordability. It will be a failure, as the Government’s policy and proposals are.

MARAMA DAVIDSON (Green): First, I just want to thank the Ngāpuhi whanaunga over here, the member David Seymour, for paying, apparently, so much attention to my speeches, often, and including tonight. In one of his earlier contributions I think he said something about my female fury righteousness. He has called me the Donald Trump of New Zealand, and he plays violins after I get up and speak, very often. Then tonight he gets up and he talks about the free market—

David Seymour: I raise a point of order, Mr Chairperson. The member is engaging in a hearty debate, but she has also accused me of attacking her in a sexist way, which I have not done and would not do, and I think she should withdraw and apologise.

The CHAIRPERSON (Lindsay Tisch): Order! If the member has taken offence by what the member has said—[Interruption] I am on my feet. If the member is offended by what has been said and takes personal offence, he can ask me to intervene.

David Seymour: I would not attack another politician on sexist grounds, and I am offended by that accusation, and I think she should withdraw the statement.

The CHAIRPERSON (Lindsay Tisch): I will ask the member to withdraw that comment.

MARAMA DAVIDSON: Mr Chair, I am only quoting what he said.

The CHAIRPERSON (Lindsay Tisch): No, no. [Interruption] Order! All you have to do is to withdraw the comment.

Hon Annette King: I raise a point of order, Mr Chairperson.

The CHAIRPERSON (Lindsay Tisch): No, I have just ruled—

Metiria Turei: I raise a point of order, Mr Chairperson.

The CHAIRPERSON (Lindsay Tisch): Metiria Turei will sit. [Interruption] Sit. I am on my feet. [Interruption] You sit too. David Seymour has taken offence at a comment that has been made. The process is—[Interruption] He has taken personal offence, I am intervening, and I have asked the member Marama Davidson just to withdraw the comment, and that is all you have to do. You do not have to make any other comment, and then you can continue your speech.

MARAMA DAVIDSON: Thank you, Mr Chair. I withdraw my comment.

Hon Annette King: I raise a point of order, Mr Chairperson. I wonder whether you could spend some time looking at a ruling the Speaker gave some time ago about personal offence. The Speaker at that time ruled that it was not a matter of an individual taking personal offence; it was a matter of whether it offended the House. [Interruption]

The CHAIRPERSON (Lindsay Tisch): No, look, I do not need any help on this matter. I am happy to look at that point. I have ruled in the past on this matter, and I am being consistent in what I have done. Marama Davidson has the call if she wishes to take it.

Metiria Turei: I raise a point of order, Mr Chairperson.

The CHAIRPERSON (Lindsay Tisch): Is this a new point of order, Metiria Turei?

Metiria Turei: It is seeking your clarification on your ruling. Can we get some clarification, then, on when Speaker Carter makes a ruling—

The CHAIRPERSON (Lindsay Tisch): I have just said that.

Metiria Turei: Yes. Can I finish the point of order?

The CHAIRPERSON (Lindsay Tisch): The member will sit, then, because I have just answered that question.

Metiria Turei: No, Mr Chairperson, I have not asked the question.

The CHAIRPERSON (Lindsay Tisch): You just said you wanted clarification of a point that had been made that the Hon Annette King brought up. I said that I would consider that matter.

Metiria Turei: It is a different point, Mr Chairperson.

The CHAIRPERSON (Lindsay Tisch): Well, what is the new point? All you are doing is trifling with my decision.

Metiria Turei: Thank you, Mr Chair. My point of order is this: when Speaker Carter makes a ruling about the definition of personal offence in relation to the House, and you, Mr Chair, make a ruling that is different from his, how then are we to interpret, between the two rulings, what constitutes sufficient personal offence that another member will be required to withdraw and apologise? That is my point of order.

The CHAIRPERSON (Lindsay Tisch): Any member, if they feel offended by something that has been said—and it relates to a personal offence—has the right to protect their integrity, but—[Interruption] I am on my feet. The member David Seymour did take offence, and it is a very simple process to actually ask the member—in this case, Marama Davidson—to withdraw the comment, which she has done. Now we can continue. Any member has the right to take offence at a comment that has been made. It is very, very straight forward. Marama Davidson, you have the call.

Iain Lees-Galloway: I raise a point of order, Mr Chairperson.

The CHAIRPERSON (Lindsay Tisch): I hope you are not going to be—is this a new point of order?

Iain Lees-Galloway: It is a new point of order. Thank you, Mr Chairman. I am not sure whether there is a Standing Order or a Speaker’s ruling that refers to the issue I want to raise, so I ask that you, perhaps, reflect on this and maybe bring a ruling regarding it. What is a member to do when they are accurately reflecting—

The CHAIRPERSON (Lindsay Tisch): No, that is a matter of opinion. The member has taken offence. That is all that I am concerned about. I have asked the member to withdraw. So I am ending the matter. We are moving on, because all you are doing is interfering with the decision that I have made, and the member took offence, Marama Davidson has withdrawn the comment, and I am asking her to continue.

Iain Lees-Galloway: I raise a point of order, Mr Chairperson.

David Seymour: Speaking to the point of order. I may be able to assist—

The CHAIRPERSON (Lindsay Tisch): No, no, I do not need any assistance from the member; he will sit. Marama Davidson, you have the call.

Iain Lees-Galloway: I raise a point of order, Mr Chairperson.

The CHAIRPERSON (Lindsay Tisch): If this is relitigating anything I have said, the member will leave.

Iain Lees-Galloway: I move, That the Speaker be recalled.

Motion agreed to.

House resumed.

Speaker Recalled

The CHAIRPERSON (Lindsay Tisch): Mr Speaker, you have been recalled on the basis of a decision that I made, and this came about when David Seymour raised a point of order about a comment that had been made by Marama Davidson. He took personal offence at the comment that had been made. I ruled that if the member had taken personal offence, the member making the comment should withdraw the comment, which she subsequently did.

In the meantime there were a number of points of order, including one from Metiria Turei that said that I was inconsistent with previous decisions that you, as Speaker, had made. The Hon Annette King made the point that I should consider the decision. I said that I would read the transcript and I would come back on the point that she had brought up, and that I would consider again and report back. I have been consistent over the period of time when someone has taken personal offence—that it is an offence against that person’s integrity—and I believe that if someone feels offended by such a comment, in order to protect the integrity of that person the person making that accusation should, in fact, withdraw the comment, which in this case the member did. We were then to move on, but you have been recalled.

METIRIA TUREI (Co-Leader—Green): There are two issues, as I understand it; others may have a different view. The first was the question of the definition of “personal offence”. In previous rulings you have made, you have said that where there is personal offence taken, it is offence to the House as a whole, not to the individual. However, the Chair did rule that because Mr Seymour had taken personal offence himself, that was sufficient to ask my colleague to withdraw and apologise. They are two different definitions of “personal offence”, and we sought clarification on which of those definitions should apply.

The second matter was that my colleague was described as a female having female fury righteousness in the debate earlier this afternoon by Mr Seymour. She referred to that comment in her contribution during the Committee stage. Mr Seymour took offence at her reference to his previous statement about her in this debate, and there is a question now about whether or not a member is able to stand and repeat the statements made by other members in this House about themselves, and then be required to withdraw and apologise for that statement. That does not seem consistent with the Standing Orders or the order of the House.

DAVID SEYMOUR (Leader—ACT): I may be able to assist. The confusion here is that I took offence at being accused of describing the member by her gender. I think that is offensive to me and to the House. I would not attack another politician in that way. The confusion has arisen—and the “yellows” that I have just had emailed through to me will confirm this—because I said that she was a ball of “self-righteous fury”, not a ball of “female fury”. Had I said the latter, I would be the one apologising, but that is not what I said, and the Hansard will confirm that I am correct. Can I suggest to the member that, rather than self-righteousness, she should get some hearing aids.

METIRIA TUREI (Co-Leader—Green): That was unnecessary, I think we can all agree. My colleague is prepared to accept that she did not get the quote completely correct—once we saw the transcript from Hansard—but, none the less, there still remains the central questions here as to that matter in a debate such as we are having, which is that a member should be able to stand and reflect on the comments made by other members that are made about themselves. And, second, what is the definition of “personal offence” that we are to use in this House? Is it an offence to the individual member of Parliament, or is it an offence to the House? We have had long debates on that. It is now more confusing than ever.

CHRIS HIPKINS (Senior Whip—Labour): I think in considering that matter there is a need to draw a distinction between whether a member feels they have been misrepresented and whether a member takes offence at a matter, because the remedies for those things are different. If a member feels they have been misrepresented, then there are steps that they can take in order to seek to have that corrected, and the threshold for that would be, if you like, more lenient than for offence. The threshold has to be reasonable for offensiveness, or otherwise we will have members taking offence at everything other members say that they disagree with. But if they feel that they have been misrepresented in the debate, then there are ways that they can seek to correct it. But asking a member to withdraw or apologise, or both, for a comment that a member feels might misrepresent what they have said but that is not in itself offensive, is going to lead the House into a state of quite regular disorder, I would have thought.

The CHAIRPERSON (Lindsay Tisch): I subscribe to the view of Chris Hipkins. I specifically asked the member: “Did he take personal offence?”. If it had been a matter of interpretation, that is a debating point, but I specifically asked “Did the member take offence?”, and that is why I pursued the measure that I did. So I subscribe to your view—it is a very clear one—and that is why I took the course of action that I did.

DAVID SEYMOUR (Leader—ACT): On the first point, the accusation made is not only personally offensive to me; it brings the House into disrepute. So I think the debate around that is moot. Secondly, we can argue about whether or not the member genuinely misheard what I had said or whether she deliberately attempted to slur me with the accusation, but, one way or another, it was something that caused offence and brought the House into disrepute. So I do not think we actually need a lot of this debate. I think we are actually ready to move on.

Mr SPEAKER: Can I just ask about part of the explanations received, particularly from Metiria Turei—I do not understand the point the member is making about misrepresentation. I can understand the comment made about the offence taken, but then you raised a point of misrepresentation that I just cannot follow.

METIRIA TUREI (Co-Leader—Green): I did not address the question of misrepresentation directly. That was my colleague Chris Hipkins, and I think he is right—

Mr SPEAKER: No, he then spoke further to your point, but I do not understand the basic point.

METIRIA TUREI: The essential point is in a debate—and we all know that this is a rigorous debate, and you tell us that on a regular basis, quite rightly—there is a lot that is said, some of which can be misunderstood. If a member of Parliament stands up and refers to something that somebody has said, particularly if it is a personal comment about them, they should be able to debate, to mention that personal comment, and to make their own analysis about that comment without concern about it being taken as a personal offence. If it is a misrepresentation, then that is a legitimate position for another member to take. But to then use personal offence to force them to withdraw and apologise over a comment that was made about them does not make any sense, and we still get back to the primary issue, which is: what is the definition of “personal offence” that is used by the Speaker?

Mr SPEAKER: I thank all members for their contributions. I was involved in a meeting, so I was not listening to the debate as we led into this. So it is a difficult one for me to sense. The tension was here. I do acknowledge that it is a vigorous debate. We are in a situation where we are in urgency. We are debating something that is, obviously, finely balanced within this House on the votes that have been taken, and it is something that is not going to be aired before a select committee.

As to the issue of when offence is taken, you cannot define it exactly. It occurs at a time when offence could be taken by a member. There are times when I have ruled that offence has been taken. I have been surprised that offence has been taken, and I have said that, but if offence is taken and that creates disorder, then a presiding officer, as Mr Tisch has done in this case, will accept that the member has taken offence and ask that that comment be withdrawn. Many times when I have made that decision I have made it without actually hearing the interjection myself; I have relied on the fact that a member said he is offended. If he is offended, it is an offence to the whole House—[Interruption] Order! On this occasion that is what has happened here.

The presiding officer, Mr Tisch, has been the Chair; he has been judging the proceedings. It is his job to keep order in the House. Without doubt, offence was taken. All members can judge whether offence should have been taken. Mr Tisch has decided that the way to then maintain the dignity and the order in this House is to require the member to then withdraw that comment. If it had been more offensive, he may have taken the option of asking the member to withdraw and apologise, but, as I understand it, he did not do that. He simply asked for it to be withdrawn, and I further understand that the member then did withdraw that remark. So on that basis, I completely back Mr Tisch, as he is attempting to maintain order in this Chamber during what has been, without doubt, a fairly tense discussion over the last hour.

METIRIA TUREI (Co-Leader—Green): I raise a point of order, Mr Speaker. Can I just get clarity, then, that it is a legitimate point of order for taking personal offence for a male member to be, in his own mind, in whatever way, accused of sexism, but it is not a legitimate point of order for personal offence for a female member who takes offence at being told she backs rapists.

Mr SPEAKER: Order! No, I think I covered that in the very first part by saying there are times when remarks will be made and offence will then be taken at that remark, and a presiding officer needs to immediately decide how best to maintain order. So I am not going to comment on a particular comment that was made as to whether it meets a threshold. A presiding officer, in this case, is required to maintain order in the House. Mr Tisch chose to accept that Mr Seymour had been offended by the comment, and he then asked the member to withdraw. That member did withdraw. That is my final decision.

In Committee

Debate resumed.

Part 1 Amendments to Housing Accords and Special Housing Areas Act 2013 (continued)

MARAMA DAVIDSON (Green): This has been a rather hefty, vigorous debate tonight. All sorts of things have been flying across the Chamber, including from the member David Seymour, about me and my speeches. I have not once chosen to stand and take offence at any of them because this is a vigorous debate and I am up for it, including right now. And, actually, after all of this, all I was going to say and suggest to Mr David Seymour was that he do what I do, which is completely ignore him.

Jono Naylor: But you didn’t. You didn’t ignore him.

MARAMA DAVIDSON: No, no, the only way I found out about what he said about me is that I got tweeted it. I got tweeted it. I found out later on what the member had said about me because people were hilariously laughing at it. So that is how I found out. Other than that, my advice is that what I do is ignore him.

So I will just carry on from there and say that what I wanted to outline in this contribution, what I have got left, is that I wanted to acknowledge the Ihumātao campaign against this special housing area (SHA) and support what my tungāne, my colleague Peeni Henare, of Tāmaki Makaurau, has said. What I want to go back to very, very strongly is that the Ihumātao community and the land it is trying to protect is right adjacent to some incredible, ancient stone archaeological sites—incredible. The land that was proposed for this SHA—Part 1 of this bill extends the fast tracking. So we have to remember that that was confiscated land. That was confiscated land.

The Ihumātao campaign to oppose this SHA, this special housing area, under the original legislation—I went to the Auckland Council governance meetings as well as the select committee meetings and listened to the presentation from the Ihumātao campaigners about protecting their land. You know what happened: both the council hearings and the parliamentary select committee hearings—across the House, across the parties—agreed that this was a bit of a mistake, this one. The approval for this one was a bit of a sham, and there was sympathy across all of the parties for the muck up in this particular legislation.

So I did want to bring the Ihumātao community and the people into the Committee tonight under Part 1 of this legislation, because—too late, too late—there was even sympathy and agreement across the parties and at Auckland Council. See, this is what happens when you fast track the information. If Auckland Council had known properly and had all the information in front of it, it admits that it would have made a different decision. This is what happens and can happen with this fast-tracked legislation, and this is what I wanted to put to the Committee in respect of Part 1 of this bill. So they all admitted this and had some sympathy.

I actually want to acknowledge that Nick Smith went to this community. He did. He gave them an ear, but it was too late—it was too late. He had already signed it off. That is what this fast-track process did. He is stuck with it now. He is stuck with that legacy of this wrong decision for the Ihumātao community to not have their precious ancient “Stonehenge” land protected under this fast-tracked consenting process. So that needs to be strongly acknowledged in this Committee, and I wanted to stand and do that.

I am sorry that David Seymour was offended at the start of my speech for something—all I was doing was giving an innocent synopsis of how he refers to me. Thank you.

Hon DAVID PARKER (Labour): Before I address why we need this transitional provision, can I say that I agree with other members who have said that this bill is inadequate to deal with the issues that are facing New Zealand in housing. I agree with something that Julie Anne Genter said: that these problems have become so problematic in New Zealand that they are causing economy-wide effects, not just having an effect on the housing market.

The problems are so problematic that they are causing problems beyond the housing market. It is true that some of the marginal price pressure comes from overseas buyers. It is true that that is driving demand for New Zealand currency, which is higher than it would otherwise be. It is true that it is suppressing the value of our exports and increasing our current account deficit. It is also true that it is distorting the investment signal within New Zealand so that more money is going into speculative asset classes and not enough is going to productive asset classes.

Having said that, I want to address another point that I do not think has been properly addressed. I want the Minister for Building and Housing to explain why we are having to do this piece of legislation—why—when the special housing areas did not come into creation until after the plan-making process was legislated for the Auckland Plan. Why was it not contemplated at the time of the special housing legislation that there was a need to ensure that the plans that were going to be made for the special housing areas would not be cut across by the Auckland Plan? As the explanatory note says—in the third dot point—the purpose of this bill is to “allow plan change requests made but not completed under the [Special Housing Areas] Act to continue when proposed district plans become operative:”.

So the first time that that could have been fixed was when the special housing legislation was passed, to have made that clear. The Minister shakes his head. It could have been done that way, Minister. You know that that is correct. The second way it could have been fixed is that one of the many arms of Government—one of the many billions of dollars that the Government spends every year could have been spent on making a submission to the Auckland Plan’s hearing panel that it should have made provision for the protection of planning processes that were under way in—[Interruption] They could have. Again, the Minister shakes his head. Of course it could have gone to those people who were hearing that and they could have said “Please don’t cut across the plans that are halfway through or about to be lodged, or give us a transitional period of 3 years.”, which is the transitional period that it wants under this legislation. It could have at least asked the planning authority in Auckland to put the same provision in the Auckland Plan.

That would have been far cheaper. The Government would not have to be coming to Parliament and pushing this through under urgency. The Minister shakes his head as if this could not have been done by the Auckland Plan if it had wanted to. The Auckland Plan could have said that in respect of areas that are special housing areas the planning process that is under way in respect of those under the special housing legislation shall have an effect for another 3 years. It could have done that. The Minister shakes his head and said: “Did they apply?”. Did you try? Did anyone from the Government go to the planning authority?

Hon Dr Nick Smith: It would be unlawful.

Hon DAVID PARKER: It would have been unlawful? Rubbish. It would not have been unlawful. It would not have been unlawful for someone to turn up and say “We need the planning processes that we’ve started for the special housing areas to continue.”, and they could have said that in respect of the special housing areas this planning provision will apply—i.e., the one that we are doing.

Phil Twyford: Amy Adams made a submission.

Hon DAVID PARKER: Amy Adams made a submission, but the Minister for Building and Housing did not—the Minister for Building and Housing did not. I am aghast that it did not get it right in the original Act. It did not get it right in submissions on the plan, and, therefore, the hearings commissioners do not even address it in their plan—they do not even address it in their plan. Do they address it in their plan?

Hon Dr Nick Smith: You are just incorrect.

Hon DAVID PARKER: But they do not address it in there. I bet they did not because the Government did not ask them to. I would like the Minister to explain why it was that they did not submit on the plan and protect these planning provisions in the special housing areas. I cannot understand why that did not occur. There were two avenues—

JONO NAYLOR (National): I move, That the question be now put.

Hon DAVID CUNLIFFE (Labour—New Lynn): I wish to make a reasonably technical contribution to this discussion, specifically around clause 5 of Part 1, which I do not believe has been addressed yet in the discussion. There are many, many clauses that we have not yet touched upon in this debate on Part 1. Before I do, may I make a brief comment in respect of the previous exchange. I am sure you will reflect on the ability of members to cause offence or otherwise in stating their understanding—

The CHAIRPERSON (Lindsay Tisch): This is out of order. Just continue with the debate. Concentrate on the bill.

Hon DAVID CUNLIFFE: Clause 5 requires two new subsections be added to the Housing Accords and Special Housing Areas Act. The first is that an Order in Council “may incorporate a map, plan, or document prepared or issued by any person or body.” That is a very significant, although ostensibly technical, amendment. Let me comment in two parts. The first is to replace what would have been a requirement for technical and specific language with any range of map, plan, or document. It is therefore possible—indeed, probably intended—that that move would make it easier for a special housing area (SHA) to cover a broader area, a broader range, a larger quantum of development. In considering that, the Committee has to take account of the rights that attach to normal consenting processes that are necessarily abrogated by this extension of the SHA process. Those are serious issues.

The next part of that subsection I think adds to that serious question, and that is because this map or plan may be issued “by any person or body.”—not a territorial authority, not a regional authority, not the Auckland Council, but perhaps by a developer, perhaps by an interest group, perhaps by the Tree Council, perhaps by Greenpeace, or perhaps by the Property Council. The point, as members can readily see, is that the uncertainty that this creates is both unnecessary and significant, given the fact that the rest of clause 5 seeks to extend and abrogate rights that are extant in the law as it stands. It is unclear—and I invite the Minister for Building and Housing to comment, because we are fortunate to have the responsible Minister in the chair—what the reasoning is behind this specific clause. Is it, perchance, the result of developer pressure for an even faster and more speedy process? Is it to abrogate the democratic processes of, perchance, the Auckland Council or other territorial authorities? Or is there a more sanguine explanation that is not apparent to members of this House? I am sure the Minister will want to comment on that.

May I reflect on the fact that there is an interesting contradistinction between this clause that the Minister has added, which allows a policy change to be done by a broad area, a large group, of housing opportunities and the contrasting approach that the same Government—I think, possibly, the same Minister—took in regard to the tree-trimming regulations in Auckland, where it removed just such an ability and required people who wanted to protect something, in this case special trees, to do it by the individual tree, which had to be specified by a long and bureaucratic process of the council. In fact, more trees probably died for the paperwork required by that highly specific amendment. And in this bill, the same Minister is doing the exact opposite. To protect something, you have to be specific to the individual tree or—thanks to Mr Goff’s pressure, perhaps, a very small group of trees—but if you want to develop something, you can do it by anybody providing a map. Imagine Captain Cook providing a map—he could do the whole country in one go. I mean, the point is, the clause—that might sound ridiculous—

Jono Naylor: Nothing more ridiculous than what you’ve been saying all night.

Hon DAVID CUNLIFFE: —does not self-limit. Mr Jono would be best to constrain his interventions to something that has substance. He has made his speech. Mr Chairman, thank you for the opportunity to ask the Minister to comment on this, and I hope he will.

PHIL TWYFORD (Labour—Te Atatū): I want to quote the Hon Dr Nick Smith. In 2013, at the time of the first reading of the Housing Accords and Special Housing Areas Bill, Dr Smith said: “The bill isn’t a silver bullet for the problem but a much needed interim measure while the Government’s longer term work programme to address housing affordability beds in.” So 3 years ago this was some kind of interim measure, but now the Government needs another 3 years while it desperately hopes that the special housing areas (SHAs) will deliver some kind of result.

Will this Minister ever do anything more than the chronic piecemeal tinkering that passes for a housing policy? Will he? Will he ever do anything more than tinker around the edges?

David Seymour: Tell us, Phil. What would the member do?

PHIL TWYFORD: David Seymour says this bill is “little more than ad hoc tinkering.” Well, I agree with David Seymour on this. That is all it is: ad hoc tinkering.

Let us consider some of the provisions in this bill. Clause 5 amends section 16 of the Housing Accords and Special Housing Areas Act (HASHAA), which provides for the establishment of SHAs. New section 16(4A) allows an Order in Council to define the boundaries of an SHA—blah, blah. Clause 6 replaces section 18 of the HASHAA and allows SHAs to be disestablished, and then there are a whole series of criteria about disestablishment. Section 18(3) currently provides for the early disestablishment of an SHA.

It is a bureaucratic nightmare. It is the product of this Minister’s mind—a Minister who for 10 years has been blaming the Resource Management Act (RMA) and blaming councils for producing an uncompetitive urban land market. He has done nothing substantial about it, and this is what he is reduced to: a bureaucratic exercise in micromanaging urban land markets. It is a massive bureaucratic exercise, with a whole lot of bureaucrats writing little lines on maps and saying: “You can do this. You can’t do that. Now it’s time to do that. If you don’t do this by a certain period, we’re going to disestablish you.” It is a Kafkaesque nightmare.

Minister, why do you not just follow through on the rhetoric that you have been spouting for 10 years and actually genuinely reform the planning process? Why do you not abolish the urban growth boundary and introduce a smarter way of managing urban growth? Why do you not protect the special environmental areas, invest in rapid transit growth to support new development, and genuinely reform infrastructure financing? But you will not. The Minister will not do that. All he does is tinker.

I asked the member for Epsom, who claims to believe in competitive land markets, who wants to see the cost of urban land go down, because he understands that the high price of urban land is at the heart of the housing crisis in Auckland. Well, it is fine for the Minister to nod his head like that. He has been saying things like that for 10 years, but he has done absolutely nothing about it. He had his chance with the draft national policy statement. That was his opportunity to genuinely reform the restrictive planning and zoning system that creates an artificial scarcity of land and drives up urban land values and makes affordable housing impossible in our biggest city.

The national policy statement was his opportunity to make change. But what did he do? He produced a draft national policy statement that implemented a giant bureaucratic mechanism, telling councils that they had to project the future need for development land, and then, if they did not think there was enough, they had to increase the amount of land in supply. An incremental infusion of land into a highly speculative land market bears no resemblance to what the Minister and Bill English have been wittering on about for a decade, talking about uncompetitive land markets. What an incredible disappointment.

This Minister is in the twilight of his career. He has been mouthing off about reforming the planning system, driving down the cost of urban land, all these years—blaming the RMA and blaming councils.

Dr PARMJEET PARMAR (National): I move, That the question be now put.

CATHERINE DELAHUNTY (Green): Tēnā koutou e Te Whare. This has been an interesting debate. If my colleague has been accused of being sanctimonious, just wait for what I have got. I wonder what the people sitting in the motels who have been sent there by Work and Income because they have got nowhere to live, watching Parliament TV—because what else would you do; I am sure they are all glued to the screen—think about this bill. I wonder how those people feel, listening to this technical and arcane debate, when what they want is somewhere to live that they can afford. I wonder what they think about the special housing areas rhetoric, which turns out to be business as usual. It turns out to be the Government saying “We’re doing something by not really doing something.”, which is quite a familiar theme to any observer of Parliament.

I wonder how it feels for the people who testified at the Cross-Party Homelessness Inquiry, when they read Part 1 of this bill and look for the innovative, committed, and justice-based provisions that are going to provide them with a home. I wonder what they think of us, as they know we are going home to comfortable homes and they are going back to the car, the garage, or the transience of 22 different homes in 3 years for a child.

We call this a debate about housing? This is not a debate about housing; this is about some weird excuse for acting on something that the Government has not got the guts to call a crisis. Why are we in urgency? Because this is a crisis—it is a crisis of conscience for this Parliament to sit here, in 2016, and make up rules about housing that will assist and facilitate developers but do nothing for the people who are shut out. They are shut out from $200,000 homes, let alone $500,000 or $600,000 homes.

Get real for a change, people. Do these people who write this legislation know what it is like to have no home? I will listen to Marama Davidson and Metiria Turei because they know—because Marama is a renter in South Auckland. Why do we not listen to the renters in South Auckland and the people who have parked up for homes? They know what the people are going through. It is too late in the history of this time to treat people as if homelessness was something that could be fixed by some bizarre tinkering with the market. It cannot be fixed by that.

The people on the streets are looking at us for guidance and leadership right now, and what are we giving them? Special housing areas over sacred sites in Tāmaki-makau-rau. When I was a child my parents bought a house through the State Advances Corporation. When I became an adult, I capitalised the family benefit so that I could have a kitchen and bathroom for my child, on a floor that was not sloping. I was lucky to be born in that dreadful old socialist welfare terrible era when the State thought that people could have a house, that it would help them do it, and that when they had it, we could get on with our lives as families and build a society and a community that worked. This Government has walked away from that.

I am not asking for a romantic, latte-free 1950s reality; I am just asking for the State to take responsibility for a crisis. I am just asking that we actually pass legislation here that will facilitate for those who really need it, not for those people who like to play the market and who want to invest in a couple of homes. If this bill did what it said it does, then Metiria would not need a Supplementary Order Paper and no one would be calling Marama Davidson sanctimonious because she stands up every day in this House for her own people, who are constantly marginalised by privilege.

But that is not what is happening in this bill. We are in urgency because this issue is so simple that we do not want the public to talk about it. If this Parliament had a solution, why would it go into urgency and prevent people from coming and discussing that solution? It is only because this is not a solution that we are having this conversation and blocking out the public. It is a disgrace.

CHRIS HIPKINS (Labour—Rimutaka): Why are we here? Why are we here, and what is this bill that we are debating? The bill that we are debating extends the time frame for the special housing areas. It extends the time frame in which they can be established until 16 September 2019, and it delays the repeal of the whole Act until 16 September 2021. So why are we here doing this under urgency? Why is this so urgent that the entirety of Parliament has to grind to a halt to push this through under urgency? Was this unexpected? Was the Minister of Housing who drafted the legislation in the first place—who put the dates in the original legislation in the first place—unaware when he wrote that that those were actually going to be the dates at which the law expired and the dates at which further special housing areas were not going to be able to be established? If so, why did it take until this week for him to bring something to the House to do something about that?

A Minister who was vaguely competent in administering the legislation that they themselves had written would have been able to anticipate that this was going to be an issue, and would have been able to address that through the regular legislative process. So why are we here? Why are we here under urgency—through the night, tomorrow, however long it takes—in order to change these dates for the special housing areas, when the Government could have done that months ago but chose not to? The Government could have done that at any point since the passage of the previous legislation, had it wanted to. It could have changed the dates if it had wanted to, and it chose not to, so why are we here? Why are we debating this under urgency when the Government could have dealt with these issues had it chosen to do so? It is because of the utter, utter incompetent administration of all of the issues around housing.

I want to turn my attention to the provision of affordable housing, in particular, because the departmental disclosure statement makes the observation that of the special housing areas already established, there are around 75 percent of them that have up to 10 percent affordable housing.

Debate interrupted.

Sitting suspended from 10 p.m. to 9 a.m. (Wednesday)

TUESDAY, 6 SEPTEMBER 2016

(continued on Wednesday, 7 September 2016)

Bills

Housing Legislation Amendment Bill

In Committee

Debate resumed.

Part 1

Amendments to Housing Accords and Special Housing Areas Act 2013 (continued)

CHRIS HIPKINS (Labour—Rimutaka): The question that I was asking the Minister in the chair, Nick Smith, before we broke last night was: why are we here when the Government has known about this issue and could have resolved it long before now? Phil Goff, the aspiring mayoral candidate in Auckland, pointed this out to the Government back in May. It has taken, now, until September for it to bring something to the House to deal with the issue, and it is now trying to rush it through all stages under urgency.

But the question that I have for the Minister in the chair, Paul Goldsmith, relates to page 2 of the regulatory impact statement around the expansion of special housing areas (SHAs). It notes that the 213 SHAs in existence now are expected to yield over 70,000 homes. Three-quarters of those will require around 10 percent of the homes within that development to be affordable. Let us do some crude maths on those numbers. Three-quarters of the 70,000 homes is 52,500. Ten percent of that—which is the component of those 70,000 homes that will actually end up being affordable—is just over 5,000. So, basically, what the Government is saying is that 5,000 affordable houses is enough—5,000 affordable houses is enough.

Let us look at the population growth in Auckland. The population growth in Auckland has been well over 100,000 since the last census—probably more than that. The age demographics in Auckland in the most recent census that I was able to get my fingers on, right before this debate started, are that there were, in 2006, 110,000 Aucklanders between the ages of 20 and 35. That is the aspiring first-home buyer age bracket—110,000. By the 2013 census, it will be significantly more. I could not get those statistics right before I stood up to speak. Basically, what the Government is saying is that 5,000 new homes are enough for the over 100,000 young aspiring first-home buyers to get their first step on the property ladder. It is simply not right. It is simply a fiction.

So the question I have for the Government is: why is this it? Why is it coming to the House and wanting to extend SHAs? The Labour Party is voting in favour of this part of the bill, because we support continuity here. We want to make sure that we do not end up with developments being stalled or anything like that. But where is the rest of the plan? Where is the plan that is actually going to result in enough affordable housing for all of the aspiring first-home buyers in Auckland who want to buy them, because 5,000 new affordable homes—which is basically what this bill amounts to—is not going to cut it. It is not going to be enough. So I would like to hear from the Minister why the Government thinks that is sufficient and what other work it is doing to meet the demographic projections in Auckland, which will result in increasing numbers of first-home buyers being shut out of the housing market. I would also like the Minister to answer my first question, which is: why now?

JAMI-LEE ROSS (Junior Whip—National): I move, That the question be now put.

The CHAIRPERSON (Hon Trevor Mallard): I will hear one more. I think we are getting near the end.

Hon ANNETTE KING (Deputy Leader—Labour): This is the first call I have taken on Part 1 of this bill, and I thought that it was important to take a call because I have been listening to the spin that the Government has been trying to put on this bill over the last 24 hours. The spin it is putting on is that Labour is opposed to building houses. Well, I want the public out there to know that we are in favour of and would vote for Part 1, because even though it is inadequate in many ways, we are the party that wants to build houses.

It was Labour that put in place KiwiBuild—and what did the Government do? It laughed and scoffed at it and said we do not need a major building programme in New Zealand for affordable housing. Interestingly, in 3 years, with the price of houses going up and housing accords being put in place, we now know that the house prices in Auckland—and also around New Zealand—have been going up and up, beyond the ability for people to be able to pay. We know that we need to take measures, and one of them is to build houses. As inadequate as this Part 1 is, we would support it.

But I have to say that I am very disappointed in the whole approach that is being taken here in Part 1. I go, also, as my colleague Chris Hipkins did, to the regulatory impact statement. The reason why we are doing this under urgency, particularly Part 1, is that it addresses the fact that developers—developers—have had insufficient time to lodge relevant consents to councils. So the reason why Part 1 is being rushed through is that they have had insufficient time.

When were these brought into being? Well, a very significant date, actually: 13 September 2013—13 September; somebody’s birthday is on that date. Three years ago the housing accords were brought in under legislation—3 years ago—and developers have had insufficient time to lodge? What they have lodged is land that they want to land bank. They want to ensure that they can ratchet up the price of that land. So why, knowing that this was brought in 3 years ago, are we now trying to extend it—in urgency—to give the developers more time?

I want to ask the Minister in the chair, Paul Goldsmith: what guarantee has the Government got that developers who have not had sufficient time will now have sufficient time? How many developers have told the Government they intend to lodge under the special housing accord? I want to know the number, because for the Government to have this in a regulatory impact statement it must have done some research. It must have done some consulting; it must have done some work. What ministerial work was undertaken to find out that the developers had insufficient time? Minister, if you have not got that information from your officials now—and I know you are only the Minister in the chair at the moment—I suggest you turn to your officials and ask what evidence they have got that developers had insufficient time. What was delaying them? Why were they delayed in putting it in? Did they not think it important enough? Did they think that if they waited long enough, the silly Government would expand the time that they could do this for another 3 years? So, Minister, I would like you to get on your hind legs and tell us what evidence you have got for what is in this regulatory impact statement, because this is the official regulatory impact statement on this bill, so I would like to know the answer to that.

I also want to know why the Government would not accept Supplementary Order Paper 212, put forward by my colleague Phil Twyford, which related to ensuring that any building in special housing areas has affordable housing. Why would you not include a requirement to have affordable housing? All this will do is extend the time for special housing areas and enable people—developers who have not had enough time—to be able to get their plans ready to build massive big houses, over 2,000 square metres, with en suites and four bedrooms, which are beyond the price range of New Zealanders. The average New Zealander, working hard, cannot afford to pay the cost of houses, and the average in Auckland is now at a million dollars. Suddenly, all those homeowners, who are the lucky ones who own, are millionaires, and there are many looking through the window, saying: “Why can’t we afford a house?”. Why does the Government not include affordable housing in Part 1?

JAMI-LEE ROSS (Junior Whip—National): I move, That the question be now put.

The CHAIRPERSON (Hon Trevor Mallard): Yes, I have looked at the list—we have now had 30 calls on this part, we have been going for a significant period of time, and it has been a while since I have heard anything new. Therefore, I think members are in a position to make a decision as a Committee whether or not they are ready to have the vote on Part 1.

A party vote was called for on the question, That the question be now put.

Ayes 63

New Zealand National 59; Māori Party 2; ACT New Zealand 1; United Future 1.

Noes 58

New Zealand Labour 32; Green Party 14; New Zealand First 12.

Motion agreed to.

The question was put that the amendments set out on Supplementary Order Paper 209 in the name of Metiria Turei to Part 1 be agreed to.

A party vote was called for on the question, That the amendments be agreed to.

Ayes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Noes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Amendments not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 210 in the name of Metiria Turei to insert new clause 4A be agreed to.

A party vote was called for on the question, That the amendment be agreed to.

Ayes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Noes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Amendment not agreed to.

The question was put that the amendment set out on Supplementary Order Paper 210 in the name of Metiria Turei to clause 5 be agreed to.

A party vote was called for on the question, That the amendment be agreed to.

Ayes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Noes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Amendment not agreed to.

A party vote was called for on the question, That Part 1 be agreed to.

Ayes 93

New Zealand National 59; New Zealand Labour 32; ACT New Zealand 1; United Future 1.

Noes 28

Green Party 14; New Zealand First 12; Māori Party 2.

Part 1 agreed to.

Part 2 Amendment to Housing Act 1955

Hon ANNETTE KING (Deputy Leader—Labour): I raise a point of order, Mr Chairperson. I went to the Table this morning to pick up the regulatory impact statement and there is no regulatory impact statement for Part 2 of this bill. I am asking, through the Chair, that the Minister table a regulatory impact statement on Part 2 for this Committee. We are being expected, under urgency, to debate a part of the bill in which there is no regulatory impact statement, and that is not good enough for this Parliament. We have not got the guidance of what is to be prepared by the Ministry of Business, Innovation and Employment. Mr Chair, I would like you to inquire why we have not got it, when we will get it, and whether we will get it before this debate concludes, because we are debating blind, other than from what we can glean ourselves, on this part of the bill. It is not good enough when we are in urgency to expect a debate without that. The Minister for Building and Housing has just arrived, and maybe the Minister can tell us when Part 2’s regulatory impact statement will arrive in the Chamber.

The CHAIRPERSON (Hon Trevor Mallard): I just want to invite the member—sorry, unless the Minister heard. Did you hear the point of order, Minister?

Hon Dr Nick Smith: I only heard the last part.

The CHAIRPERSON (Hon Trevor Mallard): Because it is an important issue, I will ask the member to repeat it.

Hon ANNETTE KING: I have asked why and when the regulatory impact statement will arrive on the Table of the House for the Opposition on Part 2 of this bill, which we are about to debate. It is not acceptable that we are being asked to debate a bill for which the Government has got information that is being withheld from the Opposition, because we rely on regulatory impact statements. Minister, when will it arrive? I wonder whether this debate can be held up until we receive it, because that is what you would do in a proper democratic debate: you would provide the Opposition with all the information that they need. I would ask, Mr Chair, whether it is possible that we wait until it is tabled in this House.

Hon Dr NICK SMITH (Minister for Building and Housing): It is a longstanding practice, and that is where provisions—and it occurred under previous Governments as well—are deemed to have no impact on public policy, that they are minor legislative changes—[Interruption]

The CHAIRPERSON (Hon Trevor Mallard): Order! This is an important point. The very member who was interjecting was the one who asked me to rule on it. There is a precedent here that is quite important and I want to listen to the Minister.

Hon Dr NICK SMITH: Treasury is responsible for developing regulatory impact statements. Treasury, as is noted in the Cabinet papers that have been publicly released, said that there were no public policy implications of Part 2 of this bill. It was simply clarifying the way in which all public agencies have administered this law in the past, and is consistent with many other provisions of law—and I could give numerous examples—where no regulatory impact statement was required as a consequence. So there is not one, and that is because this simply clarifies what the existing law is.

Hon ANNETTE KING (Deputy Leader—Labour): Speaking to the point of order, if that is the case, why was it not written in a regulatory impact statement saying that it is not required because it has no public policy impact? That would have at least given some indication. But for there to be a blank on this and for us to rely on the Minister saying that that is what he was told—we have not received that advice. We have not got it written anywhere. So Minister—

The CHAIRPERSON (Hon Trevor Mallard): I think I might have a solution. The Minister for Building and Housing did refer to a Treasury report, which he said has been made public, that indicates that this is the case. He has assured the Committee that there is a Treasury document, which is available, that indicates that it does not have a public policy impact, and I think that the simplest thing would be if the Minister asked his officials to get a copy of that and get it on to the Table of the House as quickly as possible. That would save me having to make what might be a more difficult ruling.

Grant Robertson: I raise a point of order, Mr Chairperson.

The CHAIRPERSON (Hon Trevor Mallard): Can I just check—if it is publicly available, then I think the Minister can point us to where it is publicly available.

Hon Dr Nick Smith: With any bill that comes through the parliamentary process, Treasury makes an assessment with its regulatory impact team, just on every clause on every bill—you will not find a Treasury report on every provision. What Treasury has advised is that it deemed that there was no regulatory impact of these provisions, and so they were not included in the regulatory impact statement on this bill.

The CHAIRPERSON (Hon Trevor Mallard): I do want to check with the Minister: was that advice received in writing?

Grant Robertson: I raise a point of order, Mr Chairperson.

The CHAIRPERSON (Hon Trevor Mallard): Well, no, I am sorry—[Interruption] If the member has it—

Grant Robertson: Yes, I do.

The CHAIRPERSON (Hon Trevor Mallard): That is fine.

GRANT ROBERTSON (Labour—Wellington Central): Why do I not do this—I have actually got a second point of order. Why do I not do this—I seek leave of the Committee to table the Cabinet committee paper Housing Legislation Amendment Bill 2016—I am looking for a date, which it does not seem to have on it. It has been released—it says 6 September, I think, but that cannot really be right—from the office of the Minister for Building and Housing to the Cabinet economic growth and infrastructure committee. It includes, in paragraph 88, that “Regulatory Impact Analysis requirements do not apply to some of the proposals in this paper and a Regulatory Impact Statement has not been prepared for these proposals. These proposals have no, or only minor, impacts on businesses, individuals or not-for-profit entities.”

The CHAIRPERSON (Hon Trevor Mallard): Is there any objection to that document being tabled? There appears to be none. It can be tabled.

Document, by leave, laid on the Table of the House.

GRANT ROBERTSON (Labour—Wellington Central): I raise a point of order, Mr Chairperson. I have an additional point of order that relates to this document, which is the content of the departmental disclosure statement that is on the Table. This is the only document on the Table for us that gives any information about Part 2 from a departmental point of view, and I want to raise through you, Mr Chair, my concern about that document. In “Part Four” of that document, as for all bills, a significant legislative features section is required. In that section, in 4.1, the question is asked: “Does this Bill contain any provisions that could result in the compulsory acquisition of private property?”. It then also goes on to ask whether or not the bill creates or amends a decision-making power to make a determination about a person’s rights, obligations, or interests. Both of those questions are answered as “No” in the departmental disclosure statement.

I would venture to suggest that that is plainly untrue, particularly in the last part that I mentioned about the creating or amending of a decision-making power to make a determination about a person’s rights, obligations, or interests protected or recognised by law. It is quite clear that that is what Part 2 does, and I believe that we have a departmental disclosure statement on the Table of the House that is, in fact, false. In the absence of a regulatory impact statement, I believe we have a major difficulty in proceeding with this bill.

The CHAIRPERSON (Hon Trevor Mallard): Dealing with the second point of order, it is an area that I am not unfamiliar with, and although I will take responsibility for my ruling, it is one that I have consulted on because of—I think it is fair to say—similar concerns about the departmental disclosure statement. The departmental disclosure statement is not an official document. It has not been formally tabled, and therefore some of the normal responsibilities with regard to privilege and the responsibilities of Ministers do not apply to it. Therefore, the matter that the member raised is a matter for debate—and I expect some intense debate—but it is not a matter of privilege and not the responsibility of the Chair to sort out. We now move to debate on Part 2.

PHIL TWYFORD (Labour—Te Atatū): I want to make it very clear at the outset that Part 2 is the reason that Labour is opposing this bill. We believe that Part 1, although its contents are underwhelming—and we have gone into detail about the inadequacies of the housing accords and special housing areas policy—is, nevertheless, better than nothing. That is our view, and we were willing to support it, particularly in the interests of not delaying or creating uncertainty in cost for a handful of developers in Auckland whose special housing areas could be held up without the assistance with the transition that this bill would offer. So, at a pinch, we are willing to support Part 1, and we voted at the end of the debate on Part 1. But we have a whole different view about Part 2, and we are now going to go into considerable detail about what Part 2 does, the implications that it has, and why it is completely unacceptable for Part 2 to be being pushed through under urgency and denied the proper scrutiny that a select committee hearing would give it.

What does Part 2 do? It seeks to, in the words of the Minister, clarify the Government’s power—which the Minister asserts that the Government already has—to use or dispose of Government land for State housing purposes without triggering the offer-back requirements under the Public Works Act. That is what it does, in a nutshell. I am shocked that this National Government, which professes to have some kind of commitment to private property rights, would disenfranchise the rights of citizens under the Public Works Act to be offered back property that is being used for a purpose that is different to what the land was originally acquired for. It does not surprise me that much that this current National Government is doing that, but I would ask members in the Chamber like Paul Goldsmith and David Seymour, who profess some kind of commitment to the basic tenets of classical liberal thinking—of some kind of respect for private property rights. But no, David Seymour and Paul Goldsmith come here, meek as lambs, corralled by Nick Smith to vote for this tawdry, unsavoury confiscation of people’s private property rights.

I want to hear what David Seymour has to say about this bill. He is the self-appointed conscience of the nation’s private property rights, but he is coming to this Chamber to vote for this bill that confiscates people’s private property rights, without even the luxury of going off to a select committee so that this bill can be picked apart by expert opinion and public submission. Paul Goldsmith, I hope you will take a call on this bill and explain how the confiscation of private property rights under this bill actually tallies with your professed commitment to the principles of Ayn Rand, Milton Friedman, and God knows who else. I want to hear that explanation.

Nick Smith says that the Government already has the power—that there is no question, the Government already has the power—to dispose of land for State housing purposes; that it is simply a clarification. So why are we here, Minister? Why is this bill being pushed through the House, through all stages under urgency? That is the question that Grant Robertson put to the Minister earlier—I think, in the second reading—and, uncharacteristically, Nick Smith did not have anything to say. Well, we appreciate the fact that the Minister is in the chair now, but I hope he is going to get up and answer some of these questions. This is because I do not think we have heard yet a satisfactory explanation for why these provisions that would deny people who were former owners of property that was acquired under the Public Works Act, subsequently used for a different purpose, and then finally used as part of some housing development would be denied the normal rights under the Public Works Act to be offered back that land. We are not un-nuanced in this issue. We believe—and the Minister will know, when he publicly raised the need for an urban development authority to have rights of acquisition of land to deny land bankers the opportunity to hold out, to game the system, and make massive windfall gains at the expense of significant urban development—

The CHAIRPERSON (Hon Trevor Mallard): Order! I am going to interrupt the member now and invite him to address Part 2 of this bill, and not matters that are outside of it.

PHIL TWYFORD: Thank you, Mr Chairman. The point I was trying to make is that on this side of the Chamber, we are not un-nuanced on this issue. A case can be made that public agencies should be able to acquire land, to accumulate land, in the interests of housing developments. But if you are going to do that, then why not take it to select committee? Why not allow the best expert opinion in the land? Why not allow public submitters to come to the table, have that debate, weigh up the issues, consider what the safeguards might be, and do it transparently so that that debate can be properly had—so that the House can have confidence that this is not just another Nick Smith housing fiasco in the making.

The provenance of this part in this bill is the fiasco around Ngāti Whātua and the Auckland Tāmaki Collective when the very same approach that is embodied in Part 2 was used to try to sideline the rights that Auckland iwi have under their collective redress agreements to have the right of first refusal when Government land is being repurposed for a housing development. The Minister in the chair, Nick Smith, his failure to properly consult those people and respect their legal rights—the rights of first refusal—cost the taxpayer who knows how much: tens of thousands of dollars, probably more than a hundred thousand dollars. It delayed a housing development scheme; desperately needed houses were delayed by months and months and months because of that Minister’s attempt to use the very same device to ignore the rights of first refusal of Auckland iwi.

In Part 2 it states very clearly that nothing in this bill will impinge on the rights that iwi have under agreements for collective redress. But the same privilege is not being accorded to former owners of land that is now held by the Government and is being repurposed for housing development. So there is an apparent double standard there and I ask the Minister to explain why it is OK to protect the rights of iwi—their rights of first refusal under Treaty settlement agreements or collective redress—but somehow it is not worth protecting the rights of private citizens under the Public Works Act who have, under sections 40 and 41 of the Public Works Act, the right to have that public land offered back to them. That is an apparent double standard and I ask the Minister to get up and explain why that is.

It is not good enough that there is apparently incorrect and conflicting information in the departmental disclosure statement. It is not good enough that there is not a regulatory impact statement that deals with the confiscation of private property rights in this bill that is being pushed through the House under urgency. I want to hear from the National Party members, including the Minister, why it is OK, when they come to this House frequently and talk a big game about private property rights, to take away those rights from private citizens in a bill that is being pushed through the House under all stages in urgency.

DAVID SEYMOUR (Leader—ACT): I raise a point of order, Mr Chairperson. I just seek your guidance. I understand that under the Standing Orders, in these Committee debates each member is entitled to four calls. Phil Twyford has just taken his fifth. Are you going to be lenient in this debate?

The CHAIRPERSON (Hon Trevor Mallard): No. [Interruption] Order! The member might need some education but the whole Committee does not need to give it to him. It is on each question, so it is four calls on each part, except for the Minister in the chair, who has unrestricted calls. Normally, at the beginning of a debate we run a couple at a time. If members are clearly irrelevant in their first call, then we drop down. Generally we do drop down, so there should not be too much on reflection.

Hon Dr NICK SMITH (Minister for Building and Housing): I am pleased to make a contribution and to put to Parliament why Part 2 of this bill is needed if this House is serious about growing the supply of housing in a city like Auckland, and I think there is broad acceptance that it is needed. I think it is, firstly, important to explain how minor these amendments are in the context of the Housing Act. I want to take members through what the Housing Act currently says. If we refer to the current Housing Act it says in section 2(1) that “State housing purposes means the erection, acquisition, or holding of dwellings and ancillary commercial buildings by the Crown under this Act for disposal by way of sale, lease, or tenancy;”. In other words, the current Housing Act, in setting up housing development schemes, makes it absolutely plain that those housing developments are for the purpose of sale.

I then want to draw members’ attention to the current Housing Act. Section 15 says that “any State housing land and any buildings or chattels held for State housing purposes may be disposed of by way of sale, lease, or tenancy”, and it then sets out the process for housing developments on such Crown land.

Since 1955, when this Act was passed, Governments of both National and Labour persuasions have done housing developments in all sorts of corners of New Zealand. Governments of both persuasions have done housing developments and then, for a later purpose, have sold those houses. For instance, even under the previous Government—despite some of the protestations—you had schemes that involved tenants being able to buy those homes that were built under those provisions of the Government. That is, if a house was built on some State land in your own constituency in Rimutaka, your previous Government allowed the tenant to be able to buy that house. Everybody has been going on since 1955 on that basis. These issues have come into extra focus because our Government has a policy that says it makes no sense for Government agencies to have large blocks of public land sitting around vacant when there is such a high housing need.

If you take a site like Hobsonville, we are going great guns. We have built over a thousand houses. We have got a scheme to build 3,000 homes in Auckland, and that is providing for those houses to be onsold.

Hon Annette King: How many affordable?

Hon Dr NICK SMITH: Twenty percent. If you take an example such as Weymouth, I think every member of this Committee will be hugely proud of that very first special housing area—an area of former public land owned by Child, Youth and Family, a block of land that had stayed vacant for 20 years while house prices had doubled. We are getting on and have built 150 houses there—close to resolution.

The question, as we have ramped up that Crown land programme, is whether there is consistency between the Housing Act, where Parliament very specifically said those houses could be sold, and the generic provision in the Public Works Act that provides for offer back to the former owner. The question is whether the last Government, when it sold houses to its tenants, should not have been able to sell those houses to tenants but should have actually had to offer them to whoever may have been the previous landowner. When the Government built those houses in Hobsonville, should the Government have not been able to sell those houses on the open market but offer them to the previous owner?

I will tell you what the significance is. The significance of this programme is this: if I take a typical block of land such as we have got under the Crown land programme, where you have got a $10 million block of land, the Government is partnering with a private sector player and entering into contracts as we speak for those private sector players to invest as much as three or four times that amount of money to convert that $10 million worth of land into $40 million worth of sections. We are then requiring them to spend another $115 million to build houses on those properties. In that way we are going to be able to bring hundreds of houses to market, and the difficulty is this: will people invest hundreds of millions of dollars in bringing that Crown land programme into practical houses for Kiwi families if there is any legal uncertainty? The answer is that of course they will not.

So for members opposite to demand last week that there be a state of emergency on housing, and then the next week to come along to Parliament and say “We oppose urgency. We just want this thing delayed for months and months.”—the delay would mean that thousands of homes—

Phil Twyford: So take it to select committee.

Hon Dr NICK SMITH: —Mr Twyford—would not be built.

There are two other points that I want to respond to. The first is that this bill specifically provides in amended section 15, set out in clause 10(3), that “Subsection (2) does not affect any right of first refusal that a person or group of persons has in relation to the land under any Treaty of Waitangi claims settlement or collective redress Act or deed.” For the avoidance of doubt can I make absolutely plain that there is no intention to affect any other redress that a person or group of persons has in relation to any land under any Treaty claim settlement or any collective redress Act or deed.

Can I say we have had an active discussion with the ACT Party about the Public Works Act. I think it would be fair to describe the ACT Party as having some concerns about this old Public Works Act—it has been around since 1981—and it has said, actually, the way in which private property rights are dealt with in that Act requires a wider review. The Government’s position is, yes, we think the ACT Party does have a fair perspective. It is an old Act. It is an Act that significantly impacts on private property rights. But, equally, I will tell you where the ACT Party is different. The ACT Party does have a consistent philosophical position about the importance of property rights, but what Mr Seymour actually understands is that you cannot create uncertainty around programmes that are under way right now. I tell you one thing that Mr Seymour understands very clearly. He understands that uncertainty is bad for business and bad for Government. So, for that reason, the Government has agreed to an amendment put forward that provides for 10 years—through to 15 September 2026—in which it is possible to have those changes to the Public Works Act.

The last point I want to make to members of the Opposition, who—

Hon Annette King: Why don’t you answer the questions, Minister?

Hon Dr NICK SMITH: Well, Ms King—

Hon Annette King: Just answer some questions.

Hon Dr NICK SMITH: I have answered the questions. What I simply get from members of the Opposition is that one moment they demand a state of emergency—do you know something about Phil Twyford? Phil Twyford always overstretches. He overstretches by blaming people with Chinese-sounding names. He overstretches in respect of demanding a state of emergency. And, again, he is embarrassing the Opposition today by overstretching, because I actually think Opposition members know, in their heart of hearts, that this is a bill that will get houses built, and, rather than being a Wailing Wall of grief about people not being able to have houses, people on this side of the House are prepared to support legislation that will get roofs over people’s heads.

GRANT ROBERTSON (Labour—Wellington Central): I am grateful to “Groucho Marx”, who has just resumed his seat, because, you know, if you do not—

The CHAIRPERSON (Hon Trevor Mallard): Order! The member will withdraw.

GRANT ROBERTSON: I withdraw. I am grateful to the Minister Nick Smith, who echoed Groucho Marx when he resumed his seat—“If you don’t like these principles, I’ve got another set.” That is what we heard from the Minister for Building and Housing just now. You know, it is all very well to say that National is the party of private property and of liberal interests in this, but, you know, when it comes to this piece of legislation, it says: “We’ll shelve that.” As for David Seymour on that, he was bought off by a 10-year review. That is the price—jeez! You could have bid it up a little bit higher, and maybe we will see an explosion of charter schools or something like that as a result of this deal that has been done between the National Government and the ACT Party.

The Minister’s response to those questions was wholly inadequate. Let us start with a couple of important points. Every piece of legislation currently on the books that relates to the Public Works Act comes under the Public Works Act. It is not the Minister’s right to stand up and say: “Well, the Housing Act meant this, and so that Public Works Act goes out the window.” I know this very well. I brought a bill to this House on behalf of the Wellington City Council this year where we tried to do exactly what the Minister is doing today, and, actually, the Government denied us the right to do that. So the Housing Act has the Public Works Act, which, effectively, overrides it. That is the point of the Public Works Act. So just coming to the Committee of the whole House and saying “Oh well, we’ve got this bit of a conflict, so we’re going to get rid of the Public Works Act.” is not a good enough response from the Minister.

The second point that is completely ridiculous in what the Minister just told us is that he took the example of the last Government allowing houses that were State houses in the Rimutaka electorate to be onsold. The question there is not whether or not a Government can do that; it is what then happens under the Public Works Act, which is, under section 40, that the land has to be offered back to the original owners. The Minister did not answer who the original owners of that land were, because it is the Government—it is the State. That is the point. That is the very point of it.

The question the Minister actually has to answer, and failed to answer, is why this is being done under urgency. There may well be good reason why this issue has drawn itself to the attention of the Government, but the problem is that Parliament is not being treated with respect on this matter. The paper that I tabled in the Committee earlier—the Cabinet paper that describes this bill—in the section covering the matters dealt with under Part 2, has one, two, three paragraphs redacted. Those paragraphs are being withheld, and I venture to suggest that what those paragraphs tell us is that there is some form of legal challenge coming to the Government’s programme of land sales. I would further venture to suggest that that might have something to do with the Hobsonville development, because if we actually look into the purpose for which Hobsonville land was originally taken, that is where the Government gets itself into trouble.

Section 40 of the Public Works Act says: “(1) Where any land held under this or any other Act or in any other manner for any public work—(a) is no longer required for that public work;”—it is not an “or” that comes next; it is an “and”—“and (b) is not required for any other public work; and—(c) is not required for any exchange under” various other matters. So the Government, when it is disposing of land, has to establish whether or not it is required for that public work. We will do some research—and I am sure my colleagues may have already done this—around exactly why Hobsonville and the other land that the Government is working on in terms of its housing programme was taken, but I would venture to suggest there may well be a challenge.

But we are doing this under urgency and we are not being told—Parliament is not being told. So I want a Minister in the chair to stand up and be up front and honest with this Parliament about what is driving this process being done under urgency, because the public of New Zealand deserve the right to know. There is nothing urgent about passing Part 2, on the surface. According to the Minister, this is how it has always been done. He said: “This is the way in which it has always been done. There’s nothing to see here.” Apparently, we are not trampling on anyone’s rights to have it offered back. The departmental disclosure statement tells us that, apparently, no one’s rights are being changed by this law. How can that possibly be true, because, quite clearly, under section 40 of the Public Works Act, there is an offer-back right to those who were the original owners of the land. That is quite clearly true. So, clearly—

Hon Member: And that’s a property right.

GRANT ROBERTSON: That is a property right. Quite clearly, someone’s property right is being compromised by this law, so we have a major problem in the way the Government is bringing this bill to the House. It is not being honest with New Zealanders about the consequences of this piece of legislation.

Ministers—and the Minister in the chair now, Paul Goldsmith—must have been in the Cabinet discussion, and I am also going to make another suggestion to the Committee. I do not think Cabinet is fully in agreement on this. I think we will find that Cabinet has had a vigorous debate about this and many members of Cabinet are uncomfortable about this change because they know it is a significant thing to change and take away the Public Works Act from operating—as it does on any other piece of legislation—as a check on the Government when it goes to sell off land.

I am going to make several other points, and I am going to run out of time in this call so I will seek others. When one looks at what is in clause 10 of the bill, we have to be absolutely clear that there is no guarantee in here that what happens to this land will be to support housing. That is not guaranteed in clause 10. I asked the Ministers to stand up and confirm that to us, particularly when it is all dressed up in the idea—as Dr Smith finished his contribution on—on making sure people have roofs over their heads. This could go off in all sorts of directions such as commercial buildings or other services that are required. The definition is broad enough in clause 10, to my mind, to create the possibility that this land will not end up being used for housing at all.

This is exactly what we could explore in a proper select committee process to ensure that we do achieve the goal, which I think is shared across the Parliament, that we use public land in the best interests of the people of New Zealand, and in providing affordable housing for New Zealanders to buy and for that housing to be developed—that is shared across the Committee. I do not know that Part 2 achieves that. It looks to me as if what Part 2 is doing is trying to deal with a problem that has come up in front of Cabinet with a specific parcel of land and a possible legal challenge. That is what it looks like, but we are not being told that. We are being kept in the dark and the people of New Zealand are being kept in the dark by this Government.

I have tabled that Cabinet paper today. It is on the public record. There are paragraphs missing. We need a Minister to stand up and tell us what is really going on here because in the absence of that it looks like the Government is trying to slip through a change that fundamentally affects the property rights of New Zealanders, under urgency without any public scrutiny. Just think about that for a minute. That is the National Government deciding to take away the property rights of New Zealanders, retrospectively under urgency, without explaining to New Zealanders why. That is a disgrace. That is an absolute disgrace from a Government.

Jono Naylor is up the back laughing. He would not have a clue. The National caucus will not have been told a single thing about what this is about, but it is right here in the Cabinet papers. I want the Minister in the chair, Paul Goldsmith, who pretends to be somebody who believes in these principles—he has written all sorts of books about the importance of liberalism. He parades around Epsom trying to out right-wing David Seymour, but he is not prepared to stand up today and say to New Zealanders what is going on here. Clause 10 of this bill does not give me confidence that what we are doing in this Committee today is ensuring the Minister’s stated objective of making sure that there is more affordable housing available for New Zealanders. I want a Minister to stand up and guarantee to us in this Committee that that is the only outcome of this.

Secondly, a Minister needs to answer why we are doing this under urgency today. This should be the subject of proper public scrutiny. The fact that it is not shows the National Government has something to hide on this matter.

METIRIA TUREI (Co-Leader—Green): I just want to briefly describe the provision in this part of the bill for those members of the public who may be listening, because we talk in a language here that is not always entirely understandable outside. This is a provision that removes the obligation of the Government to offer back to a person the land that they previously gifted or sold—gifted, generally—to the Government, or land that was taken from them. The offer back is for land that was taken from or gifted by an owner under the Public Works Act. When the Crown does not need that land any more, it has a legal obligation to offer it back to the previous owner or their descendants at a market price or below the market price. That is the property right that is being talked about here and that will be taken away by this provision in this bill. If the previous owners or the descendants of the previous owners do not want the property, then the Government is entitled to be able to sell that land on the open market. The offer back is a right that the previous owners and their descendants will have when their land has been gifted or taken from them by the State for a particular purpose.

There are lots of concerns about the Māori issues that are related to that, and we will get to those shortly, but, just on the general legal point, the provision in Part 2 of this bill is designed to enable the Government to be able to sell the land it has been gifted or that it took and provide it to developers to build houses on, for those developers to be able to on-sell that land with those houses on it to anyone they choose. So the offer back is prevented at both the beginning and at the end of the process, under this provision.

This provision is very broad. This provision does not apply only to special housing areas (SHAs); it is actually much, much broader than that. This provision applies to any development of land for a number of purposes: land that could have housing sites on it, land that does have housing on it, land for motorways, land for roads, land for access ways, and land for flood and river protection. The criteria in this legislation mean that the Government will be able to stop its obligation to offer back land that it was given for a wide variety of purposes, so this is not just a provision about housing. It is not just a provision about special housing areas. It will affect hundreds, if not thousands, of New Zealanders who have an offer-back right.

It is much, much broader than the narrow provisions that the rest of this bill was designed for and, we are being told, is supposed to be about. The rest of this bill is supposed to be about just the special housing areas, whether you like them or not—the protection of the existing developments on special housing areas, and the extension of special housing areas. But Part 2 is much, much broader than that, and it is being sneaked through under urgency. It will give the Government the right to take from hundreds, if not thousands, of New Zealanders their property right to have that land offered back to them. That is a very serious incursion by the Government on the legal rights of New Zealanders—New Zealanders who do not know that the right is being taken from them because we are dealing with this bill under urgency. So most, if not all, of those who have this offer-back right for land that was gifted by them to the Crown or taken from them do not know that this right is being taken from them.

When we talked with the Minister and the officials, there was no evidence given to us that the people who have this offer-back right have been told about this legislation, that they know that this provision is in this bill, or that they have been advised of the potential risk of their property rights being taken. Not only that, but it is pretty clear that the Government has actually got no idea about the extent to which this bill might affect New Zealanders. When we asked Nick Smith about this, he said he did not think that there were any issues with it. He did not know whether there were Māori interests, for example, in the offer-back provision. He did not know the extent to which this provision would affect New Zealanders’ rights. He has got no idea of the names of those people. They have done no work to make sure that the people whose rights they are taking away by law have been informed about this.

I have Supplementary Order Paper 211 on the Table to delete this provision from the bill. It needs to go. Either the provision goes to a select committee, so that we can at least show those New Zealanders who have gifted land to the Crown—I mean, many of these people would have gifted land to the Crown for public works. We need to at least send this provision back to a select committee, so that we can tell and talk to those New Zealanders about the gift that they made and about the potential of taking their offer-back rights from them, or we need to get rid of it completely, because there is no justification for this provision in this bill.

If my colleague Grant Robertson is correct that this is a broad provision designed to hide a specific legal threat to the Government because Nick Smith has allowed developers to spend hundreds of millions of dollars building homes on land that he could not guarantee the legal authority over—right, then we need to know that. Because if that is the case, then Nick Smith has been grossly irresponsible as housing Minister in allowing the SHAs to continue—in allowing developers, including community organisations, to invest huge amounts of money in the building of homes while still not having legal certainty over their right to on-sell those homes. That is a massive failing by a housing Minister responsible for the special housing areas. He has allowed—

David Seymour: So he failed to violate property rights?

METIRIA TUREI: Well, this is the problem, Mr Seymour. It is that Nick Smith has allowed this legal uncertainty to continue and allowed those developers to invest hundreds of millions of dollars into homes without having legal certainty. Is it now right that many thousands of New Zealanders should have their property rights taken from them because Nick Smith failed to get the legal settings for the use of this land right at the first instance?

Denis O’Rourke: With the ACT Party vote.

METIRIA TUREI: That is right, with the ACT Party vote. Is that what our job is now—to clean up the mess that Nick Smith has made in creating a potentially serious legal problem and serious financial risk for at least one, and possibly a handful of, developers? He is trying to sneak through a provision to clean up his mess, relying on this Parliament to do it, doing it in urgency, and doing it without telling New Zealanders what the real consequences of this bill will be—that they will lose their property rights because Nick Smith has a potential legal challenge chasing him right now. Is that what is going on? Is that what is going on?

Denis O’Rourke: Of course it is.

METIRIA TUREI: Well, of course we do not know what is going on, because Nick Smith will not give us the full information about the potential risk that this provision is supposed to cover.

Tracey Martin: More than a probability he stuffed up.

METIRIA TUREI: So Nick Smith has stuffed up. He has allowed all this development to continue and all this money to be spent. Those who have spent the money have no legal certainty about their ability to sell the land that they have built on, and now Nick Smith wants us to cover it up for him. He wants us to cover it up by taking away the property rights of thousands of other New Zealanders, who have got no idea that this is happening.

David Seymour: How does the member know it is thousands?

METIRIA TUREI: Well, it could be hundreds, Mr Seymour. Do hundreds of people have to lose their property rights in order to cover up a mistake made by Nick Smith?

David Seymour: Oh, I just wonder whether the member knows what she is talking about.

METIRIA TUREI: Mr Seymour, if you want to support the cover-up of Nick Smith’s financial and legal mistakes, you are entitled to do that. The Green Party will not put its name to the mix-up, to the muck-up, of Nick Smith in potentially leaving developers and community organisations at genuine financial risk because he did not clarify the legal status of that land from the beginning. This is why we have this Supplementary Order Paper on the Table—to delete the provision, to make sure that we will protect New Zealanders’ rights to their offer-back provision. Thank you, Mr Chair.

DAVID SEYMOUR (Leader—ACT): I have been waiting patiently for an opportunity to respond to the many interesting points that have been raised in this debate. I will address my comments, as tightly as I can, to clauses 9 and 10, which are currently on the Table, but it is worth considering various provisions in both the Housing Act 1955 and the Public Works Act 1981 because here, in the real world, those pieces of legislation all interact. They influence the property of New Zealanders, not only their land that may have become Crown land acquired under the Public Works Act or some other Act in the past but also the homes that people have recently bought that have been built on that land.

I look across at the Labour Party today, which is an embarrassment to the giant who built it. It is a party that wants to build 100,000 homes through the Government, but it will not seriously consider, engage with, or understand the legislative underpinnings that would be required to do so. The fact of the matter is that under sections 40 to 42 of the Public Works Act, as it stands, the first right of refusal is exempt in a number of circumstances, including where the land has been developed. Under the 1955 Housing Act it is possible for the Government to use Crown land to develop and build housing. Those are the facts, and that is what Governments of both stripes have been doing for a very long time. It is, no doubt, what the Greens would have done had they ever made it into Government. So when we inherit this history, we have to think very carefully about the different stakeholders involved and how the law will influence their interests going forward.

There is an inherent conflict between the Public Works Act and the Housing Act. There is a conflict in saying that the Government has a role in developing and building housing on Crown land, and yet the Government also has a requirement to give a first right of refusal to people who may have had their land taken compulsorily under the Public Works Act in the past. That conflict does not sit easily with me because, unlike the Labour Party, I do not believe that the Government should be in the housing development business. There is no public policy justification for the Government to be building houses.

There are many reasons why the Government might compulsorily acquire land. One might imagine a Government attempting to build a road from Auckland to Wellington, with one or two people opportunistically holding out and preventing their property from being sold for any price, hoping to gain a rent off the New Zealand public in the construction of the road. For those reasons, we can understand why there might be a Public Works Act and why the Government might compulsorily acquire private citizens’ land, but there is no good reason for the Government to acquire land simply so it can do housing development. That is something that Parliament needs to address in the future, but none the less it is not something that could be addressed in the current time frame.

Let me explain a little bit about why that time frame is so tight, and why I cannot support the Supplementary Order Papers that have been put on the Table by Metiria Turei to delete clauses 9 and 10, and the amendment by Phil Twyford, I think it is, to have Part 2 of this bill sent off to a select committee. As I have said, there is an inherent conflict between the Public Works Act and the Housing Act, and what that inherent conflict opens up is the possibility of an opportunistic legal challenge where land that has been taken at some past time and subsequently developed by the Government—which the Government should never do, even though Labour thinks it should—is then sold to people who are now homeowners. Often, working-class homeowners—whom the Labour Party should stand up for—who are trying to pay their mortgage may find themselves subject to an opportunistic legal challenge, where they could actually have their property rights and their livelihood under threat. The thing about property rights is that they tend to conflict with each other. This is just the real world, which is affected by the legislation that we are making today in this House.

But then other members have asked why we cannot at least take more time. Well, what if we were to send this away to a select committee for, say, 6 months? Within a year we might have actually managed to pass legislation somehow clarifying this problem, but the reality is that leaves a year of uncertainty and a year of potential legal challenge to people’s livelihoods, and I think that would be an absolute disgrace. It would be imperilling the rights of New Zealanders, and that is not the sort of thing that this Parliament should be doing. None the less, I agree with the new-found belief in due process in private property rights that Metiria Turei has recently exhibited. I agree with what Annette King has been barracking from the other side of the House, which is that due process in private property rights is important. I hope she will remind Labour’s caucus of that next time it has a KiwiBuild discussion.

It is wrong for the Government to take land for anything other than a tightly circumscribed set of public policy purposes where there is a genuine market failure and the taxpayer is, frankly, at risk of extortion. Housing development is one of those, and this area of the law needs to be tightened up over a longer time frame than is currently available because right now, having put this bill on the Table in public, in the House, we have invited opportunistic legal challenges to people who have already bought homes on what was formerly Crown land. So what I have done is negotiated with the Minister to support this bill on the basis that we will improve public policy in the long run.

People opposite have scoffed at the fact—

Grant Robertson: You know it’s retrospective, don’t you?

DAVID SEYMOUR: Yes, and the current scenario would also be retrospective, Mr Robertson. You are so petulant and puerile, you trip yourself up and fail to engage with the real issues. Mr Robertson would look a lot more dignified in his mistakes—

Grant Robertson: I raise a point of order, Mr Chairperson. I take offence at being described in the way that the member just described me, and I ask him to withdraw and apologise.

The CHAIRPERSON (Lindsay Tisch): Well, this is a pretty robust debate—[Interruption]—and I am on my feet. The member has taken offence. I ask the member to withdraw the comment.

DAVID SEYMOUR: I withdraw the comment. Thank you, Mr Chair. Is it not interesting how thin-skinned and sensitive those members are when it really gets going? Mr Robertson’s various errors and mistakes could be made with so much more dignity if he only carried himself in a more dignified manner normally.

Members opposite have been saying that it is a poor deal to have a 10-year review. Well, let me just explain to members opposite why a 10-year review is a much shorter time than they might otherwise imagine. People from the Labour Party are not normally accustomed to being in business, but let me explain to them that when you do a development—particularly a property development—the cycle is roughly 10 years. What this means is that any future developments that are going to be contemplated by folks out there are going to run into the very uncertainty that this bill looks to clarify, and they are going to run into it very soon if they are going to begin a development in the near future. What is being achieved by the amendment that puts a 10-year sunset clause on clauses 9 and 10 is that it will force this House to revisit, not so long from now, the fundamental questions of when—

Chris Hipkins: A decade.

DAVID SEYMOUR: Honestly, it is actually really quite difficult to get anything across to their education spokesperson. He really has not managed to hear the very simple things I have been saying for the last 30 seconds. Yes, it is a decade, Mr Hipkins, but if your lead time for development is a decade, then you need to start thinking about it now—

Grant Robertson: It’s retrospective.

DAVID SEYMOUR: —and the House will come under pressure to resolve this issue very soon. If I could just reply to what Grant Robertson is saying—

DENIS O’ROURKE (NZ First): There is much more to clause 10 of this bill than meets the eye. The justification given for it in the general policy statement is utterly vacuous. I want to read part of the general policy statement, because it shows what I mean. It says at the beginning: “The Housing Act 1955 explicitly provides that State housing purposes include the building and development of houses for sale, lease, or tenancy, and includes acquisition by the Crown of land for houses and ancillary commercial buildings, schemes of development and subdivision, and the necessary roads, reserves, and infrastructure.” Then, at the very end of that general policy statement, it goes on to say: “the relationship between the sale of State housing land for development as part of the Crown’s housing objectives … and the consequential exclusion of offer-back obligations is not explicit. The Bill confirms that the offer-back obligations do not apply to the sale of land as part of the Crown’s housing objectives.” I do not understand, because there is not any consistency between those two statements that I read out.

That whole paragraph, that whole policy statement, is nonsense as a justification for clause 10 of the bill. So that is my starting point. The inconsistency shows the confusion behind the Government’s approach to all this. Clause 10 actually inserts a substantial new addition to section 15 of the Housing Act, ensuring that sections 40 to 42 of that Act will not apply—not just in the future, but retrospectively, in the past. This is new law, and it is retrospective, because of the words that I just mentioned. The words were “have never applied”—have never applied. A lawyer, if they so wish, will use those words to claim in any court action that the intention of those words is that that section will be retrospective; otherwise, why would they be there? Why would they be there?

The claim is that this is just a provision that clarifies the existing law. The truth is that it is a completely new and substantial addition to section 15. That is the truth. I would like to hear from the Minister why he would deny that, and how he could deny that in the circumstances. After all, if you did not need the change, why is it being made? If it is just clarification, why is it being made in the substantial way it is set out in clause 10? The main point is that it is the intent of what is being done that really matters here, and the intent is to fast track the sale of State housing land. That is the real intent, and it should not be done at the expense of the property rights of people. This is new law, and without it there would be a good possibility of a claim to offer-back rights. In fact, the good possibility is so high that it is bordering on a certainty.

Other speakers have alluded to the fact that there is a lot here that we do not know—except many of us have heard whispers and many of us have heard suggestions that some people may well be contemplating a legal challenge as far as these particular provisions, and their right to an offer back, are concerned. So it seems very likely to me that what is actually happening is that, all of a sudden, under urgency, the Government feels that it is necessary to cover its backside, because somebody is about to come along and give it a good, hard, sharp kick. That is the reality. That is why this is being done, and the Government is simply not being honest about its motives for this particular provision, which, after all, does have a significant impact on the property rights of individual people.

I will say this: I suspect that what it has got to do with is the Hobsonville land, and I suspect that what it has got to do with is the rights of Limited Service Volunteers, who had—and have—rights in relation to that land. Those are the people who, I suspect, may be contemplating—again, for another time, because they have faced this in the past—their rights, and their rights to an offer back as far as that land is concerned. But that is only one possibility. It is only one possibility; there are, no doubt, others. Some of my colleagues may take a part in this debate and talk about, for example, what the Government’s intentions may be concerning land that is currently education land but, under recent legislation, could be designated as housing land. These provisions could then be used to fast track it for sale without offer-back provisions that would otherwise apply—and that is the exact issue as far as the Hobsonville land was concerned.

It is what we are not being told that really matters in this debate. I deplore a situation where a Government is putting through under urgency a provision of this kind, which is not allowed to go to a select committee, where a lot of this stuff may well have come out. That is being avoided by this situation, and I think it is absolutely deliberate by this Government. I would like the Minister to stand up and deny these things. I would like him to deny that the real reason for clause 10 is that he is afraid of legal action by people who do claim private property rights in respect of the offer-back provisions under the Public Works Act. I want him to come to this Chamber and deny that, and then I will take notice. But until that happens we have every right to believe there is more to this bill than meets the eye. It is often said that where there is smoke there is fire. Well, there is a hell of a lot of smoke as far as this bill is concerned.

JONO NAYLOR (National): For many years now there have been State houses that have been sold. Tenants have been able to buy the houses that they have been living in for some time. Of course those properties may well initially have been taken under the Public Works Act or purchased under the Public Works Act. In fact, right through many of our communities, tenants have been able to purchase the State house in which they have been living, and yet at the same time I have not heard any of these people on the other side of the Chamber up in arms, saying: “This is infringing on the property rights of the people who initially owned that land and should have rights under the Public Works Act to come back and purchase that land back.” This is not a significant change.

Actually, quite often within bills that come through this House—in the 2 years that I have been here, on a number of occasions there are tidy-up bits in those bills that ensure that the language is right and clarify how things have been in the past, and are, going forward. There are, as I said, no specific changes here. We have just heard from Mr O’Rourke—his take on clause 10. But what it actually says is: “To avoid doubt, sections 40 to 42 of the Public Works Act 1981 do not apply (and have never applied) …”.

Denis O’Rourke: What about the rest of the clause?

JONO NAYLOR: Then it goes on to list those things that are not included and have not been applied in the past. It is important that we clarify this. It is not the substantial part of this bill.

The substantial part of this bill is in Part 1, which I will not discuss as it has already been done. It has been passed, and we are moving on. But Part 2 has got some tidy-up language in it to ensure that, going forward, there is no ambiguity and that there is clear understanding about which types of land, which types of purchases that have been made under the Public Works Act, do not apply and have not applied before. The clarity will be there.

We hear from the other side of the Chamber, and I have heard it through all parts of this debate as we have been going through so far, that “We’ve got a different plan. We’ve got a plan called KiwiBuild.” I understand that if those houses were ever to be built—and I doubt that they will, under that scheme—if that was ever to happen, those properties ultimately would need to be sold. But, of course, they would not be able to sell them if people were trying to stop these provisions from being put in place. I have not heard a rational reason yet for pulling this clause out and debating it separately, it needing to go through the select committee process.

All I have seen so far this morning is what appears to me to be a deliberate attempt to take this urgency debate beyond 1 o’clock this afternoon, so that then the Opposition can collapse the House. We will see what time we finish today, but I can tell you that if this debate actually finishes after that time today, what I believe—[Interruption] Suddenly they start reacting, when the truth comes out, and yet what I have heard over time is accusations against this side of the House saying that our members’ bills are wasting Parliament’s time. I would like to see, going forward today, that we will not waste Parliament’s time. We will do this in a timely manner. Thank you.

CHRIS HIPKINS (Senior Whip—Labour): I seek leave for the House to begin its Wednesday sitting session at the conclusion of the urgency.

The CHAIRPERSON (Lindsay Tisch): Leave is sought for that purpose.

Tim Macindoe: Can I seek clarification from him. The Wednesday session—the entire programme, as per the Order Paper?

Chris Hipkins: Yes.

The CHAIRPERSON (Lindsay Tisch): There is no Order Paper for Wednesday. We are in urgency. An Order Paper is only published once urgency finishes, and then it becomes the new order of the day. With regard to the leave that you are seeking, can you just clarify that, because there is no order of the day other than the urgency that we are in at the moment.

CHRIS HIPKINS (Senior Whip—Labour): The Order Paper, of course, is normally published at the conclusion of the urgency. You are quite right. If the urgency continues beyond 2 o’clock, the National members have indicated their concern that the House would not be able to sit for the remainder of a regular programmed Wednesday session. I am seeking leave for that to be able to happen.

The CHAIRPERSON (Lindsay Tisch): I am just seeking some advice. I thank the member for the points he raised when seeking leave. I have not struck this before, so I am going to seek some guidance. Once I have some guidance as to how it could be facilitated—I hear what you are saying—at that stage I would be happy, once I have some guidance as to whether that can be facilitated, that then, possibly, you could seek leave again. At this stage I am unsure. I want to know in my own mind. I understand how it currently works, but I know how you are trying to facilitate something, and I am happy to get advice on that.

KELVIN DAVIS (Labour—Te Tai Tokerau): It is obvious to the Committee that what is more important to the National Government is stopping at 1 o’clock so its members can go and have lunch rather than deal with the issue at hand, which is the homelessness situation in New Zealand. It is also a bit rich for David “Thin-skinned” Seymour to stand up and start casting aspersions on the members of the Labour Party, saying that they are petulant, and accusing Grant Robertson of things, when that member is No. 1 in the House for mocking and ridiculing other members. And yet, when something happens to him or is said about him, he is what we say in Māori, a tangiweto—a tangiweto. He is a cry-baby.

I want to address this directly, and I have tabled an amendment to clause 10. It is a very important amendment. At the moment section 15(3), in clause 10, states: “Subsection (2) does not affect any right of first refusal that a person or group of persons has in relation to the land under any Treaty of Waitangi claims settlement or collective redress Act or deed.” The wording here implies that this applies only to those Treaty settlements that have already been finished. I was at the Māori Affairs Committee today and we were talking about a number of iwi that have yet to have their claims settled, such as Te Atiawa, Tauranga Moana, and Ngāti Pūkenga. Those are the ones that are before the select committee—not to mention that other noble iwi of my own, that peace-loving, passive, humble iwi of Ngāpuhi, who are yet to even have an agreement in principle or a deed of settlement signed. We are concerned that, as it is written, this provision in the legislation will not apply to those tribes that are yet to settle, because we are talking about “under any Treaty of Waitangi claims settlement.”

So what I am proposing in my amendment, after the word “any” and before “Treaty of Waitangi claims”, is that we include the words “current or future Treaty of Waitangi claims.” It is very small. It is not going to really require any major discussion. I just think that the Government needs to accept that it has missed out a little bit there, and that we need to make sure this clause applies not only to settlements that have been completed but also to future settlements.

Incidentally, just coming from the Māori Affairs Committee, we are going to be briefed on rights of first refusal (RFR) in the next few weeks. The officials told us today that no two RFRs are actually the same, and there could be any number of differences. In fact, they said there are about six or eight differences around rights of first refusal, and it depends on the different settlement. For example, what happens is that we are under the impression that iwi get the first right of refusal. That is not the case. There is a bit of a process that the Government goes through. The first process is it looks to other Government departments or agencies. For example, a bit of land might actually be offered to the Ministry of Education if it wanted to build a school or a kura kaupapa or something like that. The second level is that it could be offered to a charitable organisation. For example, Gloriavale is a charitable organisation. Land could be offered, first of all, to Gloriavale to help its charitable functions.

And then iwi are the last cab off the rank. We are sick and tired, as Māori, of being the last cab off the rank all the time. Iwi should be at the top of the list. Iwi should be the first to get the right of first refusal, not the last cab off the rank. Also, I have to just make comment about David “Thin-skinned” Seymour and the way he is propping up the current system—

David Seymour: I raise a point of order, Mr Chairperson. I would hate to give more credence to the accusation, but I think it is important to uphold the standards of the House. It is not actually within the Standing Orders to call people by a nickname or moniker, as the member has been throughout his speech, and he should withdraw that.

The CHAIRPERSON (Lindsay Tisch): Yes, well—[Interruption] Order! I hear what the member is saying, and there has been some latitude in calling people by various names. I just ask members to concentrate on the bill.

KELVIN DAVIS: Mr Chairperson, I will withdraw and apologise for being so hurtful. That is beside the fact that Mr Seymour is propping up the very system that is leading to homelessness. He is happy, he said, for a motorway to be built from Auckland to Wellington, and that we compulsorily acquire land under the Public Works Act for any property owners who are holding up the works. However, he will do that for cars and trucks and everyone else, but he will not do anything for homeless people and helping people get into affordable houses. That just goes to show the priorities that the ACT Party has in terms of making life better for New Zealanders. David Seymour is happy for trucks and cars to get a fast access way from Auckland to Wellington, Wellington to Auckland, but he is not going to back New Zealanders to get into cheap, affordable, comfortable, warm, dry houses en masse. Thank you.

MARAMA DAVIDSON (Green): So I am—what do you know—still opposing this Housing Legislation Amendment Bill. What we are talking about in this Committee stage is Part 2. I have just been talking to my colleague Maureen Pugh, to confirm that she and I are the newest members in this House at this moment, and for some of the longer-serving members it might be less than obvious that, as my colleague pointed out, the way we talk about the processes in here is not always accessible to all of the public. I think it is really important, as sexy as Parliament TV is, that we ensure that the processes are clear. We are still coming to grips—sorry, I will not speak for my colleague. I am still coming to grips with this process.

So this bill and Part 2, which we are talking about right now, is being rushed through under urgency in the House. It is being rushed to be passed. What this means is that from 3pm yesterday we have been here, rushing through the House all of the stages of passing legislation that will apply to our New Zealanders. This is not ordinary. So we are rushing it through.

This means that there is no longer the time between the readings to ascertain what is in this legislation, to hear from officials and experts in the area, to deliberate across the parties about this bill, and to go into what we call a select committee to sit down and pull this legislation apart, deliberate on it, and hear from the public—hear the public submissions on this bill. That is necessary in a democratic society so that we can make the best legislation, hear all the things, and make sure that we are protecting New Zealanders’ rights.

This bill is being rushed through under urgency, to wipe out all of that process. It absolutely denies us the opportunity to really suss out how this legislation is going to impact on people, on all the different groups of society. Further to that, there is ordinarily another report that is done by Government departments. They sit down and they really go through it and have a look, and prepare a report for all of us members of the House.

For Part 2, the very part that we are discussing right now, this was not completed. That is how rushed this legislation process is for this particular bill. So we are really sort of not upholding the best democratic process with this particular piece of legislation. There are times when legislation does need to be rushed through the House, but this process is important for this Part 2. It is of deep concern to the Green Party that this part of the bill is being rushed through the Committee, because it pertains especially to and is about the offer-back provision, which I will explain.

This bill wipes out—destroys—the offer-back responsibility that the Crown has to the public when they are landowners or descendants of land that was owned in their whakapapa, in their whānau. So just very quickly, the offer-back provision is when the land was taken from or gifted by any owner under the Public Works Act. When the Crown no longer needs that land any more it has to, ordinarily, offer that land back to the previous owner or their descendants. Oh, and by the way, the land has to be offered back at the market price, or below. If they do not want it, then—and only then—it can be sold on the open market.

So Part 2 of this very bill that we are discussing destroys that obligation of the Government, and that is why the very fact that we are rushing this bill through under urgency and the very fact that there was no departmental report on the impacts of this part of the legislation—this is the thing. This is a big thing.

I want to quickly acknowledge what my colleague Kelvin Davis was referring to, which was the right of first refusal under Tiriti o Waitangi settlements. Part 2 also contains a so-called protection of the right of first refusal, which is when iwi must be offered first, before anyone else, the whenua. However, what my colleague Catherine Delahunty raised at the Māori Affairs Committee today is that it is not a true right of first refusal; it is a right of second refusal, in practical terms, in some of the Treaty bills that are being put through the House. So again, Part 2 of this legislation also does not uphold the absolute right of absolute first refusal. So I wanted to acknowledge that as well. Part 2 of this bill has huge consequences.

I want to pick up on where a number of colleagues—Grant Robertson, my colleague Metiria Turei, and Denis O’Rourke have asked the question: why? Why this Part 2 and the destruction of the offer-back provision? Why has that happened under urgency? Such an important and huge consequence to landowners and to the public—why are we rushing this through under urgency?

I want to refer to the Green Party officially, on 28 June this year, asking the Minister concerned, Nick Smith, because we knew that the State housing law was about to wrap up. We officially asked the Minister what his plans were—this was on 28 June—after the expiry of this legislation that establishes special housing areas. “What are your plans, Minister, after this expires?”. His official reply—so this is 28 June—was that he had not received any official advice or correspondence. OK—28 June. Then, just over a month later, on 10 August, he took this bill to Cabinet. So either he and his officials rushed this bill up in less than a month or the Minister did not tell us the full story.

We have a right to ask what the full story is, and what is actually going on. If, in fact, you rushed up a bill of this consequence in a month, there are no skills there. That is not good governance—that is not good governance.

Metiria Turei: Mistakes will be made.

MARAMA DAVIDSON: Absolutely—mistakes will be made, as my colleague has just said. Mistakes will be made—that is not good governance. There is a reason why we have good governance processes, particularly when the consequences are huge.

So I have just outlined that the Green Party officially asked the Minister what his plans were going to be. He said “Nothing, nothing”, and a month later: “Oh, we have this huge bill.” Hey—skills? No skills.

There are some very serious questions that we should be asking here, and I am thankful for taking this call, because this is the thing: it goes to both how we want to uphold our responsibilities as representatives and for good governance, and the actual content and how it will impact in the future on landowners and on the New Zealand public.

So there are a couple of things going on there, and the Minister surely can tell us what the full story is. We are asking what happened. Why the rush—or were we not given the full story when we officially asked for advice from the Minister and his officials? Thank you.

The CHAIRPERSON (Lindsay Tisch): I am just going to comment on Chris Hipkins’ application for leave—and I have sought advice. The Committee cannot give leave for what is proposed, and I want you to explain to me in a minute what your intention is. Only the House can do that. So the process would be that at 12.55 the Minister and I would call to report progress, we would go back into the House, leave could then be sought, and it would be up to members to decide whether they would accept the leave. That is the process. So my questions are: by leave, are you seeking that there would be question time and then we would resume urgency for the remaining stages in Committee, followed by the third reading, and then we would resume Government orders of the day as per the Order Paper, which would be published at that time? Is that what your intention is?

CHRIS HIPKINS (Senior Whip—Labour): Yes. When I put the leave, my expectation was that we would simply continue all the way through the urgency and then begin the regular sitting session, whenever that may be. However, I understand that there are issues around ministerial availability, for example, for question time at 2 o’clock. Therefore, if the course of action that you have suggested is acceptable to the Government, it is certainly one that we would support, which is that we would have question time at 2 o’clock, then move back to complete urgency for however long that is required, and then we would move on to Government orders of the day as listed on the Order Paper. We would be very comfortable with that course of action.

The CHAIRPERSON (Lindsay Tisch): So, to the Government, I am not asking for an answer, but does that explain what the rationale is?

Tim Macindoe: Yes, it’s clear to me.

The CHAIRPERSON (Lindsay Tisch): Do other parties understand what is being mooted here?

Hon Members: Yes.

The CHAIRPERSON (Lindsay Tisch): Is the New Zealand First Party happy?

Fletcher Tabuteau: We understand, yes.

The CHAIRPERSON (Lindsay Tisch): You understand, yes. So, knowing now what Labour is intending to do, if the Government wishes to proceed with that, at 5 minutes to 1 we will need to report progress and then you would then seek leave and the House would then decide whether to proceed with what you have suggested. Are we all clear on that? OK.

ANDREW LITTLE (Leader of the Opposition): I think it is important, even at this point in the debate, to correctly characterise exactly what it is that the Committee is being called upon to do. We have, in Part 2 of this bill, a provision that would cut right across the property interests and property rights of an unspecified number of people who have had land compulsorily acquired under the Public Works Act, and who retain an interest or right in that land to the extent that if it is not used for the purpose for which it was acquired and is not intended to be used for any other legitimate purpose, it must be offered back to the original owner.

That is a matter of property right and property interest, and this House is being asked by the Minister for Building and Housing and this Government, under urgency, to traduce that right without any of the appropriate scrutiny that would otherwise happen in the select committee process, which would allow public submissions and a proper public debate over a reasonable period of time. That is all being expunged for the purpose of taking away that right under this bill. That, in my view, is a constitutional outrage, and it is not something that this Committee should disregard, pass over, or be dismissive of for the sake of legislative expediency on the part of the Government.

What stuns me about this is that when you have a look at the paper that has accompanied the bill—one of the tabled papers—it says, in terms of the Minister’s justification to his Cabinet colleagues for this exercise, that although some consequential amendments were made to the Housing Act when the Public Works Act was enacted in 1981—this is in 1981—the interaction between the Housing Act disposals and the offer-back obligations under section 40 of the Public Works Act was never clarified. So the Minister’s case for urgency in the House and for avoiding select committee scrutiny and proper public debate is that 35 years after legislation was passed that apparently left some confusion in the minds—at least of the Minister—we now, under urgency, have to clarify the confusion. That does not gel. That circle does not square.

I am sorry, but 35 years on from a piece of legislation that probably predates David Seymour, by the looks of it, we are now being asked under urgency for some sort of clarification, knowing that doing so cuts across property rights to an unspecified number of people. That is not a proper use of this Parliament. That is not a proper exercise by a single Minister nor an entire Cabinet, of their authority and their mandate. You do not traduce New Zealand citizens’ property rights in that way. If we are to cut across the rights that some New Zealand citizens will have in land that they once owned and was compulsorily acquired under the Public Works Act, let us have a proper, open, transparent, and public debate.

We are so dependent in this country on constitutional convention, on these unwritten rules, these unwritten understandings that we have between us irrespective of the side of the House that we are on. This exercise, on this day, under this bill, is cutting right across that. It horrifies me, and I think that if more New Zealanders knew about it, it would horrify them as well. We cannot support this part of this bill. National can put as many things as it likes up on social media accusing us of all sorts of heinous crimes in the interests of trying to get a few more houses built, because that is what Part 1 of the bill would do, but nothing can justify the constitutional egregious outrage that is caused by Part 2 of this bill. It must stop.

New Zealanders must be treated with respect and courtesy, and if the small flank represented by the ACT Party, in terms of this Government, cannot stand up for the rights of New Zealand citizens, then, of course, we have to. But we do make this case about it, and we make a song and dance about it. It is important that this part not be passed, in the interests of constitutional correctness.

Su’a WILLIAM SIO (Labour—Māngere): The House has been denied the opportunity and benefit of having this legislation scrutinised by a select committee. We have been denied the opportunity of receiving the advice from the committee. The public has also been denied the opportunity of making submissions on this bill, and we have been denied the privilege and benefit of the wisdom of Local Government New Zealand and the general population, who have not had the opportunity to scrutinise this bill at all.

We have been given three pieces of paper to try to make sense of this legislation. Earlier my colleague the Hon Annette King said that there is no regulatory impact statement for Part 2 of this bill. That is further denial of us really making good sense of what this bill is about. But it has been, I believe, characterised well by Andrew Little, the leader of the Labour Party.

I also want to say that we have been expected to take on board the word of the Minister for Building and Housing that, because there is no regulatory impact statement on Part 2—he has asked us to believe him—there is nothing untoward in this bill. But there is a range of rumours floating around in this place, and one cannot help but feel concerned and uneasy about what this legislation really is about. The image that comes to mind, when the Minister says that we have got to take his word for it, is the image of President Richard Nixon with his two peace signs, saying that he is not a crook. I say that because when you look at clause 9 in Part 2, it refers to the Housing Act of 1955. The Housing Act of 1955 gives powers to the Minister of Building and Housing and it gives powers to the local authorities to be able to take land for State housing development. If you look at clause 10, it makes reference to the Public Works Act of 1981. What it does is it removes any powers that were laid in sections 40, 41, and 42 of the Public Works Act. What it means is—the Public Works Act suggests that if land was taken for the purpose of building State housing, and if that purpose no longer exists, then the land ought then to be made available back to the original owners. Clause 10 says that right is now expunged. That right has now been destroyed. That right no longer exists. [Interruption] If that young man there would just shut up a minute, I will continue.

The point I want to make here is that there seems to be some conflicting aims. We are told that the purpose of this bill is to increase the supply and make housing more affordable. How is that going to be achieved under this particular clause? How is the removal of rights of people—if the land is no longer going to be used for the purpose of creating and building State housing, how is the purpose of building more affordable housing going to be achieved? I ask that question because this Government is attempting to tell us that the purpose of this bill is to build more affordable housing. I cannot see that happening. I cannot see that happening when, for the last 8 years, this Government has been aware of the growing national housing crisis. We have a crisis of not enough houses, not enough State houses. We have a crisis of people living in cars—

David Seymour: I raise a point of order, Mr Chairperson. I seek your assistance in respect of Standing Order 176(5), which states that debates in the Committee stage should be limited to the objects actually instructed by the House that the Committee should debate, not the overarching principles or purposes, which is what the majority of this member’s rather erratic speech has been about.

The CHAIRPERSON (Lindsay Tisch): When Mr Speaker yesterday accepted the urgency motion, he made it clear, in accepting the urgency motion and the points of order that came prior to that regarding the content of this omnibus bill, that it would be a wide-ranging debate. In Part 1, that has been so. In Part 2, I am very mindful of what is being said, and I am listening very carefully. From my point of view, if it stretches outside the realms, even though there is some licence to extend it, then I would deal with it at the time. The member is correct, in a sense, that we should, in Committee stage, deal with the Part before us, but the precedent was set when the urgency motion yesterday was put. I am complying with that ruling by Mr Speaker yesterday.

Su’a WILLIAM SIO: The point I am making refers to clause 10. If land was taken specifically for the building of State housing, and that purpose no longer exists, what I see is that this clause conflicts with the purpose of the bill. I am asking, because we have been asked to take the Minister’s word for it, whether the Minister, or any Minister for that fact—

DAVID SEYMOUR (Leader—ACT): I would like to direct my comments towards some arguments that have been made from the other side of the Chamber about how this particular clause, clause 10, is retrospective. We all know in this Committee that retrospective law is bad law. We all know that the Government should seek to make laws that people can actually anticipate and plan their activities around, rather than be second-guessed by. If, indeed, the matter before us in clause 10 was retrospective, then we would have to very seriously consider opposing it on those grounds.

The great difficulty is that although the effects of clause 10 are retrospective, it is clarifying a particular situation, which is the Public Works Act and the Housing Act as they stand, which are also retrospective. So if we were to ask the question “Is clause 10 introducing retrospectivity into the statutes bill?”, the honest answer would have to be no, because there is already retrospectivity in section 15 of the Housing Act and sections 40 to 42 of the Public Works Act. That is the confusion in the law that clause 10 seeks to resolve.

It might help members to actually read what it says. It says “To avoid doubt,”. The issue is that there is already a doubtful situation where it may not be clear who is able to claim against housing that has been developed, turned into housing, and bought by people who are now new homeowners and attempting to pay their mortgages—often precisely the sorts of people the Labour Party was set up to stand for but has, sadly, forgotten.

I will take your advice on it being a wide-ranging debate, because is it not sad to look across at the Labour Party? I had two people come up to me in the adjournment who said that they had recently spent time with Andrew Little, and they were effusive about his boringness. The fact of the matter is that we now have a Labour Party that is completely rudderless—a Labour Party that says that it wants to build 100,000 houses through its so-called KiwiBuild, but a Labour Party that believes in supporting legislation that is going to mean that any “KiwiBuilt” homes, to modify the phrase, that are built on land that was Crown land that was at any point in the past ever owned in any kind of private ownership, will be subject to opportunistic legal challenge.

If the Labour Party members had any coherence in their desire to make housing affordable to more people through a programme of Government construction of housing, they would be very concerned to support this initiative, because it actually clears the way for precisely the type of public policy that the Labour Party normally stands for. But, “Mr Boring”, unfortunately the Labour Party does not have a coherent programme. Those members are opposing this today because they think they can stand on principle, but it is not a principle that they have ever stood for before.

The Labour Party will be back in Government one day, perhaps, if it is very lucky, and those members will have to reverse everything they have said today in order to achieve their underlying principles. The ACT Party, by contrast, has played a constructive role in this debate. We have introduced an amendment that will ensure that the inherent conflict between the Housing Act 1955 and the Public Works Act 1981 must be resolved by this House very soon. It is not right that people who own private property should have their property rights impaired for a public purpose that is not proper, and the Government becoming a property developer is not a proper public purpose.

I proudly stand for ACT as a party of principle that plays a constructive role in public policy debates, which is far more than could ever be said for the Labour Party, which has twisted itself in contortions like a tightly wound pretzel in this debate—one minute standing up for property rights, one minute saying that there is a crisis in housing, and the next minute saying that it wants to build 100,000 houses on Crown land when it is voting for legislation that will make that all the more insecure and all the more difficult. It has been hilarious to listen to the Labour Party. Thank you.

LOUISA WALL (Labour—Manurewa): Malo e lelei, Mr Chair—it is Tongan Language Week—and I also want to take the opportunity to just say kia kaha to our colleague Nikki Kaye at this time. I am going to just outline the process of me trying to understand what Part 2 of this bill is trying to achieve. We are here debating the Housing Legislation Amendment Bill, which seeks to amend the Housing Accords and Special Housing Areas Act of 2013. Part 2 is about amending the Housing Act, and refers specifically to sections 40 to 42 of the Public Works Act, and I just want to look at those sections of the Public Works Act. Section 40 is about “Disposal to former owner of land not required for public work”, section 41 is “Disposal of former Maori land when no longer required”, and section 42 is “Disposal in other cases of land not required for public work”. I think the emphasis on public work in all those sections actually means that we should look at the definition of what public work is, under the Public Works Act of 1981.

The definition of public work in that Act is: “(a) every Government work or local work that the Crown or any local authority is authorised to construct, undertake, establish, manage, operate, or maintain, and every use of land for any Government work or local work which the Crown or any local authority is authorised to construct, undertake, establish, manage, operate, or maintain by or under this or any other Act; and include anything required directly or indirectly for any such Government work or local work or use”. So the definition of public work is actually really clear: it has to be undertaken by the Government or it has to be undertaken by a local authority.

We take land that is owned by New Zealanders—citizens—but we take that land for the greater good. The Government does do this and has done this many times in the development of our communities, of our society. The interesting question that I have for the Minister in the chair is: of the 154 special housing areas (SHAs) in Auckland, how many involve State housing land? That cuts to the heart of this specific part of the legislation, because, in essence, those SHAs do not actually fit when you look at the definition of public work.

I want to highlight two developments that have been highlighted through the passage of this bill. The first one is the Clarks Beach tranche 10 development. That development is actually being undertaken by Knight Investments. They are the people who applied to Auckland Council for a resource consent to undertake that build. The Government is not building the 110 houses in Clarks Beach, Auckland Council is not building the 110 houses in Clarks Beach, but Knight Investments is, so, by definition—under what constitutes public work—that is not public work. If we have used State land for this development then there is an issue, and we should have looked at whom that land was acquired from, and we should have provided an opportunity for that owner, whose land was taken for the public good, to have a right, at least, to say whether or not they wanted to buy that land back. That is what our opposition to this part of the bill is all about.

We could have had some of these questions answered. I could have known—if we had had a select committee process, the officials could have answered—how many of the 154 special housing areas in Auckland involved State housing land. We know that in Tāmaki it does, so what has been the relationship between that development and the local iwi, for example? Have they been offered the right of first refusal? The other development that I managed to find the developer for was the Redhills (Fred Taylor Drive) Whenuapai tranche for development by Hugh Green Ltd, the Westgate Joint Venture, and Nuich Trust. In fact, we are here because—

CHRIS HIPKINS (Labour—Rimutaka): I am happy to take a call on this bill and perhaps pick up where my colleague Louisa Wall just left off, and that is on the difference between a public housing development and a private housing development—which is something that seems to have escaped most of the members opposite. Using compulsorily acquired land for a public purpose, which can include a public State housing development, is quite different to using compulsorily acquired land for a private development—including a private housing development. That is the distinction that seems to be lost on the members opposite, yet that is the exact distinction that this bill is seeking to address.

If land that was compulsorily acquired for one public purpose such as a school—or, in many cases around the country, for the Defence Force, because a lot of surplus Defence Force land, such as Hobsonville, is being used for housing developments—is being used for Government-led housing developments, i.e., State housing developments, there is no legal issue now because the law already allows for that. But where the ambiguity arises is where the Government wants to dispose of that land for the purposes of housing development, but not housing development that the Government is going to do. That is the important distinction that many members opposite do not seem willing to even acknowledge, and, certainly, that the Minister does not seem willing to address or explain.

If it is about State housing development, then that is already allowed for. If it is about State housing development that is then subsequently sold, as has happened all over the country—you take my electorate, the Hutt Valley; big chunks of most of that area were State housing developments that have, over time, been progressively sold off, bit by bit, here and there, pepper potting the private sales around—that has been absolutely fine; nothing in the law stops that from happening now. But where the ambiguity arises is if the Government has a block of land that they have compulsorily acquired that they do not want any more, which they would otherwise be obliged to offer back to the original owners under the Public Works Act, and it decides that it wants to ensure it goes for a housing development rather than some other purpose that the original owner may have. Rather than dealing with that issue, what they are trying to now do is allow the Public Works Act provisions to continue to apply when they then sell that land to a private developer. That is a massive infringement of private property rights. I never ever thought I would see the day when the Green Party is united with the Labour Party in defending private property rights—

Hon Member: And New Zealand First.

CHRIS HIPKINS: —and New Zealand First, as well—and the ACT Party is the party arguing against it. I never thought I would see the day in the House, but, apparently, according to David Seymour, trading away your principles like that is called “being constructive”. And trading away one’s principles is actually OK—providing there is a 10-year sunset clause; it does not matter. Principles are allowed to be breached retrospectively as well—and that is a whole new thing. That is a whole new distinction that I think the House is very excited about, because I certainly did not understand that principles were available to be traded off retrospectively in the way that David Seymour has suggested they are. But I want to highlight—

Denis O’Rourke: His caucus told him.

CHRIS HIPKINS: That is right; he is at a caucus meeting right now. As the Minister mentioned in his contribution when he tried to address this issue at the very beginning, he talked about “building by the Crown”. Those were the words that he used when he was talking about the provisions in the Housing Act. Those were the exact words: “building by the Crown”. Nothing in the existing law stops that happening now and nothing stops the building that has been done by the Crown subsequently being sold. Where there is ambiguity is where it is a private developer.

Take Pōmare, for example. I do not know the basis upon which the Pōmare land was acquired, but up until recently it was all State housing. So had it been acquired under the Public Works Act and it was all State housing it would have been fine. What the Government has done is that it has demolished all of the State housing that was in that area so it became vacant land. It then sold that vacant land to a developer, so it is no longer a Government-led housing development—in the words of Nick Smith “building by the Crown”. That is not building by the Crown. The original houses were “building by the Crown” but they were all demolished—so when the Crown disposed of that land it was empty land, it was vacant land, and it was sold to a developer for private property development. So, therefore, should that have been offered back? If it had been compulsorily acquired should it have been offered back? I have not heard an answer from the Government about that and I want to hear an answer from the Government about that because that is what this whole issue turns on, and in the absence of any proper legal explanation for the need to do this by the Government why are we supporting it?

Dr MEGAN WOODS (Labour—Wigram): It is a pleasure to take a call on this to ask some questions of the Minister in the chair, because there are many outstanding questions that my colleagues have raised and some that I will raise that just have to be answered.

This is a piece of legislation that is going through without a select committee phase. This is the Committee of the whole House and this is the time for the Government to front up and answer those questions that we have put to it about this legislation. We had the contribution from David Seymour. Well, I would describe that contribution as dancing on the head of a pin in a manner that would make John Locke turn in his grave. What we had was a confused and addled speech from David Seymour—the man who thinks there is a sunset clause on his principles and that you only have to defend private property rights unless you have sold them off, but there is a sunset. What we want to know is when the sun is going to rise for Mr Seymour. He says this is about resolving the ambiguity between the 1955 Housing Act and the 1981 Public Works Act. I would like the Minister in the chair to tell me why it is that we are resolving ambiguity between pieces of legislation that have been operating since 1955 and 1981 respectively, and it is now in 2016 that we are having to come and resolve those issues.

What is the problem we are trying to resolve here, Minister? Is there impending legal action that needs to be resolved? Jono Naylor—the great white knight who came to the defence of the Government’s actions in this legislation—told us that what was happening here was not significant and that it was just tidying up some language. Well, why, Minister? Why are we here tidying up this language? Please answer that question.

Hon Gerry Brownlee: We care about the people—that’s why.

Dr MEGAN WOODS: It is something we on this side of the Chamber are still wondering about. Why is it being done and why is there the special Treaty provision? What is it that is being tidied up?

Given that the Minister supporting Greater Christchurch Regeneration is in the Chamber not to take a call but to bellow across the Chamber, there are some other questions about how this cuts straight to the heart of the problem that people had with the compulsory acquisition within the centre of Christchurch for anchor projects. The suspicion was that if land that was acquired was not going to be used for the stated strategic purpose then it would be onsold and would not be offered back to the people it was acquired from. So where does that leave it? We are certainly not seeing anchor projects springing up in the central city. This was an issue where members of the ACT Party took to the streets and marched with Labour and the Greens back in 2012. So this is an issue that a range of people have had concerns about—and New Zealand First also. Sorry, Mr O’Rourke, I think you were probably at those as well. This is an issue that has been bubbling away within the Christchurch rebuild and that people rightly have concerns about.

I would also like to address some further questions to the Minister. We know that the regulatory impact statement, as my colleague Annette King rightly raised, relates only to Part 1. The regulatory impact statement said that there had not been time for consultation in a formal sense but, none the less, some conversations had happened. So what I would like to know from the Minister in the chair is what conversations of an informal nature have happened in regard to Part 2. Who has been spoken to? What was the outcome of those conversations, and what is the information that the Minister could give the Committee to inform this debate? Given that this is a debate under urgency, there is no regulatory impact statement, but we do need to know who has been spoken to and what was discussed.

I would also like to draw attention to the points that my colleague Grant Robertson raised in a point of order. He was instructed by the person in the chair at the time that the departmental disclosure statement says that the bill does not contain any provisions that would result in the compulsory acquisition of private property. I would like to hear from the Minister in the chair how that is the case when we are dealing with clause 10 in Part 2 of this legislation, which is all about the compulsory acquisition of private property.

ANDREW LITTLE (Leader of the Opposition): I want to pick up a point that David Seymour had started to make and then abandoned in favour of some more insubstantial comments when he took his call recently—that is, his claim that this provision is not retrospective—but also in the context of the earlier comments I made about the constitutional significance of what we are doing, and I do not think that can be overstated. This House should never be called upon to pass, under urgency, legislation that cuts across the rights of citizens, except in the most extreme and rare circumstances. It is not about saying we should never have legislation that denies the ability to compulsorily acquire land or exercise some other sort of coercive or intrusive power. But no power like that should ever be legislated without proper, full scrutiny over the proper length of time that we would expect legislation carrying such powers to be properly debated. The justification for this legislation is that there may be—and it is unspecified because key parts of the Cabinet paper discussing it have been redacted—some legal risk. It is interesting what the paper goes on to say. It says that the reason for the legislation is to remove the uncertainty and to mitigate the risk of legal challenge.

For Mr Seymour’s benefit, I say that the risk of legal challenge can arise only out of transactions that have happened in the past. It is unusual that people litigate over things that have not happened yet, but I do not know what goes on in the caucus meetings of the ACT Party and anything could happen. To mitigate the risk of legal challenge is about dealing with actions of the past. And the Minister in his paper to Cabinet specifically states that he is proposing the amendment in relation to the offer back obligations to former owners for what he describes as “to avoid doubt that they have never applied”. The fact that there is doubt at all suggests that there are issues arising from past transactions, and whether there are genuine legal threats and, therefore, legal risk to the Crown, or whether it is just in the mind of the Minister, and who can answer that question, the reality is we are being asked in this legislation to pass—

Kris Faafoi: It’s a riddle.

ANDREW LITTLE: —ha, ha—a provision that cuts across citizens’ property rights.

The most disappointing thing about some of the contributions to this debate, or, in fact, all of them, really, from Mr Seymour and the ACT Party is that when I look at the founders of that party—because, let us face it, the driving forces came out of the Labour Party, because we in the Labour Party have been incubators of political talent for some years now, and some of those people went off to establish the ACT Party. But whether those people were coming out of the Labour Party, or were even those coming out of the National Party in the form of Derek Quigley and some of those others, and Don Brash, when he decided which party he actually came out of or was aligned to, they are people who, faced with this situation, were people of deep principle who would never tolerate being part of a Parliament that allowed legislation like this, knowing what it does—traducing citizens’ rights—to pass through urgency, and to pass without the scrutiny that ordinarily would apply to legislation such as this.

For Mr Seymour’s sake, I say that this is legislation that does have retrospective effect. There will be people who will have rights and interests in land that is being compulsorily acquired under the Public Works Act that will likely be the subject of offer-back provisions, and this bill, if it is passed in its current form, will deny them the opportunity or the right to have that offer back made. So we simply should not allow this provision to pass in this form, and I simply ask the Minister in the chair, Michael Woodhouse: what exactly is the precise need for the urgency on this basis? Why cannot this part of the bill go through the proper parliamentary process, with the full scrutiny that the select committee allows it, and allow members of the public, and especially those whose rights and interests will be affected by it, to have their say and inform members of this House exactly how it will have an impact on them? The members of this House deserve nothing less, but, most importantly, the citizens affected deserve nothing less.

MARK MITCHELL (National—Rodney): I move, That the question be now put.

KRIS FAAFOI (Labour—Mana): It is a pleasure to take a call on Part 2. I want to concentrate on two key phrases—

Hon Gerry Brownlee: It’s the only part you can take a call on.

KRIS FAAFOI: Nice of you to arrive, actually, Gerry. I would like to look at clause 10 and two key phrases, and the Leader of the Opposition has just pointed one of them out to me. The first one is “To avoid doubt,” and the second, which is in brackets, is “(and have never applied)”. Because those two phrases exist in clause 10, I believe there is some serious justification for this piece of legislation to be squared away and separated out into its own legislation, but also it deserves the scrutiny of a select committee, because to have the phrase “To avoid doubt,” in clause 10 suggests that there was some doubt, and then we have to make the assumption that this Government has, in clause 10, which inserts new subsections (2) and (3) into section 15 of the Housing Act, actually taken care of that doubt.

We do not believe that it has taken care of all of the doubt, and because of the phrase “(and have never applied)”, I believe that there might be some New Zealanders out there who may have been affected by this piece of legislation and might have something to say about that. That is why I question, along with the Leader of the Opposition, why this piece of legislation is being rammed through under urgency. I do want to quote, and respond to, something that Jono Naylor said. He has, I think, been the only National MP who has been brave enough to get on his feet and try to defend this piece of legislation under Part 2. He said: “This is not a significant change.” We should always be worried when a National MP stands up in this Chamber and claims that “This is not a significant change.”, because something else must be going on when only one of National’s MPs can stand up in this Chamber and put his head above the trench and try to defend the changes that it is making here.

Can I also point to some of the discussion that was had, before this started, around points of order and the lack of a regulatory impact statement. I think that is important, because people at home and those in the gallery listening may have thought that was just a bit of procedural nonsense that no one cared about, but the fact that this Government has not bothered to get its officials to look at this piece of legislation and say what impact this has on the average New Zealander speaks volumes about its lack of any plan around its housing strategy and the arrogance it shows in that it has not even bothered to ask the officials to look at it.

I think the fact that we have not got that regulatory impact statement shows that the Government is trying to rush this through because there is something else afoot, which would probably lend to the fact that we are not seeing this being put under a select committee process, and I think it also feeds into the well-embedded narrative that Nick Smith and this Government have absolutely no clue when it comes to solving the housing crisis. What have we had as the plan? Either it is some half-arsed—[Interruption] Oh, hold on, I take that back. I am sorry; I apologise—some quarter-arsed plan that a Minister might announce—

The CHAIRPERSON (Hon Chester Borrows): Lift your game.

KRIS FAAFOI: —before Budget day that does not work and that, when its effectiveness is looked at, 15 people were helped by, and that plan was to move people out of Auckland and say “Here’s $3,000. Go to another part of the country.” I believe it was around a dozen people who were helped. So I am sorry, Mr Chair, if the Government took offence at my statement that it was half-arsed, because that was overstating the effectiveness—

The CHAIRPERSON (Hon Chester Borrows): You do not keep doing it. Just try to lift your game.

KRIS FAAFOI: —of that measure. It was overstating the effectiveness of that measure. [Interruption] Ha, ha! This piece of legislation should have gone through a select committee process, and I do look back to clause 10 and the first three words “To avoid doubt,”. There was some doubt. This piece of legislation does not clarify that doubt. Also, the other phrase, “(and have never applied)”, suggests that there is some retrospective action happening here that New Zealanders should have been allowed to have a say on.

ALASTAIR SCOTT (National—Wairarapa): I move, That the question be now put.

Hon ANNETTE KING (Deputy Leader—Labour): I want to put to you two further arguments as to why this part of the bill should be sent to a select committee. Just before I do that, I have to express my disappointment that we have been unable to get any answers to questions, and this is the only time there will be questions asked on this part of the bill in the entire time. The public will not get to ask; only the Opposition will get to ask, and we have failed to get our passing parade of Ministers who have sat in the chair to answer questions that have been put. I think that that shows a certain arrogance by the Government, which has put up one backbench speaker to defend it and has given no answers. That is not good enough.

There are two reasons why Part 2 should go to the select committee. We were told by the Minister there ought to be a review of the Public Works Act. The Minister Nick Smith has said that. Why is this part not included in the review of the Public Works Act? Would you not think that that was the first step of any changes? Rather than having an added-on urgency motion, trying to pass it through all stages in a sticking-plaster way, why would the Government not do a review of the Public Works Act, which the Minister said needed to be done?

The second issue is one that Kelvin Davis raised. Kelvin Davis said that the Māori Affairs Committee members are about to start looking at first refusal rights and they are going to consider it at the Māori Affairs Committee. First refusal rights—that is a piece of work they are doing. So why, in looking at this, would we not ensure that we join this up? You see, there is no joined-up thinking here by the Government. It is all over the place. So we have got the Māori Affairs Committee looking at first refusal rights, as they affect Māori, I presume; we have the Minister saying we need to review the Public Works Act; and we have the hapless Minister for Building and Housing, who comes in and puts in, under urgency, a quick little change—not very important, at all.

There is a way to go about this. We send it to the select committee. In the meantime the Government has work done on the review, the Māori Affairs Committee does its work, and we come back with a sensible proposal to this Parliament. We then ask the public of New Zealand—in fact, maybe they would like to get the Law Commission to look at this, but then we come back to the Parliament and back to the people of New Zealand and ask them what they think, because this is not a good process, and I am going to tell you why.

I do not know whether other members have picked this up, but at the very beginning of the day when we went to the Table to get the documents we rely on to debate this we were told that the departmental disclosure statement was not a tabled document—not a tabled document. What is that Table? I cannot understand it. If this is lying on the Table amongst all our bills, all our Supplementary Order Papers, and we are told that the departmental disclosure statement is not official, and it is not tabled—it is a nonsense. So we are relying on, to debate today, a not-official, not-tabled departmental disclosure statement. I want the Minister to tell us why we have to rely on a not-official, not-tabled document to argue on Part 2 of this bill, because that is what we are being asked to do.

When you look through it you have to say that it is very, very shonky what they have provided in this non-official, non-tabled document. For example, it says: “Were any regulatory impact statements provided to inform … on this bill?”. Yes, they said. Well, no. There is no regulatory impact statement on Part 2 of this bill. Here is another one. It says: “If so, did that RIA team in the Treasury provide independent opinion on the quality of these regulatory impact statements?”. Well, no. It did not. We got a Treasury paper and then they set about redacting anything that would have helped us understand it. You see what I am saying? This is just not good enough. This is not the way a Parliament should work. It then goes to say: “Has further impact analysis become available for any aspects of the policy to be given effect by this Bill?”. No. This is what the non-official—

STUART SMITH (National—Kaikōura): I move, That the question be now put.

PEENI HENARE (Labour—Tāmaki Makaurau): Tēnā koe, Mr Chair. Thank you very much for this opportunity. I want to touch on a couple of points that the Hon Annette King made with reference to my colleague Mr Davis and his contribution. New subsection (3) of section 15, inserted by clause 10, says: “Subsection (2) does not affect any right of first refusal that a person or group of persons has in relation to the land under Treaty of Waitangi claims settlement or collective redress Act or deed.” The amendment tabled by my colleague Mr Davis wants to include in there, after “any”, the words “current or future”. I think that is an important thing. He spoke of a noble tribe from the Far North, a tribe called Ngāpuhi, and, actually, if you hear the claims being put in front of the Waitangi Tribunal, the extension of their land goes all the way into Auckland, all the way down past Mahurangi, and falls within the Auckland Unitary Plan, and that is an important fact that is being missed here.

That is really important, and I want to raise a particular case within Tāmaki-makau-rau that actually points to the ambiguity and some of the issues that will fall out from this type of proposed legislation. I want us to all think of Ngā Whare Waatea Marae in Tāmaki-makau-rau—Ngā Whare Waatea Marae. A bit of a history lesson—that land was confiscated by the troops who raided the Waikato. It was subsequently sold on to another family member after the confiscation. It was then taken by the Public Works Act. It was taken by the Public Works Act in the hope that Child, Youth and Family could use it to build hostels for troubled teens. That was the purpose of that land. It was not used. It sat vacant there for a long, long, long time. A visionary in South Auckland, the mother of Mr Willie Jackson, a former member of this House, decided—

Hon Gerry Brownlee: What’d you call him? Did you call him a visionary?

PEENI HENARE: Ha, ha! Well, he is part Ngāti Porou and so am I, so he can be a visionary for the purposes of this discussion. They decided to use it to build a marae to service the people of South Auckland. They built the marae to service urban-based Māori. Those who did not have any particular strong connection to their tribes—those who were disconnected—attached themselves to Ngā Whare Waatea Marae. Ngā Whare Waatea Marae goes to apply for a permit to make sure that they can expand on their buildings so that they can cater for the influx of numbers. This is where the whole situation falls apart, because that land is currently still owned, as a result of the Public Works Act, by Child, Youth and Family. That is a really big issue because it is not using that home, yet it is stopping the use of that land by a community organisation. No right of first refusal has gone back to any of the owners, whether they were the ones subsequent to the confiscation. Ngāti Paoa has a claim on that land, which has been heard by the Waitangi Tribunal. All of these parties are involved in that one piece of land.

How is this Government proposing to fix that? How is this Government proposing to offer a right of first refusal to one particular group while forgetting the others? It is doing it by subterfuge. It is pushing this proposed part, tacking it on to Part 1, and just brushing it off as a minor amendment. It is definitely not that. Say that to the people at Ngā Whare Waatea Marae. Say that to those who attach themselves to that marae and the services it provides. I wonder what is going to happen with that particular land, given the size of it. There are large vacant lots on there, and I suspect that this Government is going to move very shortly to call it a social housing project and deny the rights of Ngā Whare Waatea Marae, which has occupied that area for a long time. This is the ambiguity that comes out of a rushed process where people are not heard—where the democratic process is not engaged. People outside of these walls do not have an opportunity to contribute.

MAUREEN PUGH (National): I move, That the question be now put.

A party vote was called for on the question, That the question be now put.

Ayes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Noes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Motion agreed to.

The question was put that the following amendment in the name of the Hon Dr Nick Smith to clause 10 be agreed to:

insert after new section 15(3) the following subclause:

(4) Subsections (2) and (3) and this subsection are repealed on 15 September 2026.

A party vote was called for on the question, That the amendment be agreed to.

Ayes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Noes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Amendment agreed to.

The CHAIRPERSON (Hon Chester Borrows): The question now is that Metiria Turei’s amendment deleting clause 10, set out on Supplementary Order Paper 211, is out of order—sorry. This is a statement, not a question. Metiria Turei’s amendment deleting clause 10, set out in Supplementary Order Paper 211, is out of order as inconsistent with the previous decisions of the Committee.

The question was put that the following amendment in the name of Phil Twyford to clause 10 be agreed to:

in chapeau of section 15(2), replace “if” with “as part of or immediately following the development of State housing land or erection of dwellings and”.

A party vote was called for on the question, That the amendment be agreed to.

Ayes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Noes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Amendment not agreed to.

The question was put that the following amendment in the name of Kelvin Davis to clause 10 be agreed to:

insert in section 15(3), after “any” in the second place it appears, “current or future”.

A party vote was called for on the question, That the amendment be agreed to.

Ayes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Noes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Amendment not agreed to.

A party vote was called for on the question, That Part 2 as amended be agreed to.

Ayes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Noes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Part 2 as amended agreed to.

New Part 3 Amendment to Housing Corporation Act 1974

PHIL TWYFORD (Labour—Te Atatū): I am really pleased to see this new Part 3. I think there is no doubt that this is going to significantly strengthen what is a flawed and disappointing bill, based on the first two parts. Part 3 will really strengthen this bill. It is quite consistent with the goal of this bill, which is housing affordability and, particularly in this case, an increase in the supply of housing.

We made a number of criticisms in the first and second readings, especially when the Hon Dr Nick Smith was in the chair, about the limitations of the Government’s policy of special housing areas. It has yielded very few new homes in the 3 years since the Government legislated the Housing Accords and Special Housing Areas Act. We have seen in Auckland—I think, in 3 years—only 1,300 new homes have been built in the special housing areas. It is highly debatable how many of those would not have been built if the Act had never been passed in the first place. At best we can say the special housing areas have perhaps brought forward some houses that would have been in the pipeline anyway.

The other big defect, of course, in this whole policy approach is that it has resulted in very few affordable homes, which, after all, is what people are so desperate for. We have seen in Auckland—Dr Smith was kind of pressured by Auckland Council and this Parliament into allowing a requirement for 10 percent of new dwellings in the special housing areas in Auckland to be required to be affordable. But we know, also, that in other parts of New Zealand where he negotiated housing accords he refused point-blank to allow a requirement for a certain percentage of affordable homes.

The approach that we see set out in Part 3 of this bill is a whole different approach to tackling this problem, and it recognises that we currently have a broken housing market. In fact—yesterday, I think—Dr Smith, Minister for Building and Housing, acknowledged to Newshub, I think it was, that he was willing to concede that the Auckland housing market is “out of control”. After 8 years in Government and after 3½ years as housing Minister, he has acknowledged not that there is a housing crisis but that the Auckland housing market is “out of control”. One of the ways it is out of control is that it is not delivering any affordable houses. Only about 5 percent, according to the Prime Minister and the Deputy Prime Minister—only 5 percent of the new homes that are being built are affordable.

Part 3 of this bill, which I will dub the “KiwiBuild” part of this bill, would actually result in the construction of thousands and thousands of new, high-quality, affordable homes for first-home buyers. What this part does is it amends the Housing Corporation Act and says that the Minister for Building and Housing—for the moment let us assume that is the Hon Dr Nick Smith—must ensure that affordable housing is built—

Grant Robertson: Not in about an hour.

PHIL TWYFORD: —for the moment—that the Minister for Building and Housing must prepare a plan in consultation with the corporation for the delivery of 10,000 affordable houses per year for first-home buyers. This is the first decent housing policy that we have been able to debate in this House for many a day. For years—how many years?

Hon Members: Eight long years.

PHIL TWYFORD: For 8 long years we have had to come to this House and debate one inadequate, ad hoc, piecemeal, panicked housing policy after another. Finally, hallelujah, we get to debate a proper housing policy. It happens to be a housing policy that a majority of New Zealanders support, according to the most recent opinion polls. I think it was about 60 percent of New Zealanders who said they wanted to see a Government-backed building programme to deliver large numbers of high-quality affordable homes for first-home buyers. So, happy days. Our time has come.

GRANT ROBERTSON (Labour—Wellington Central): Can I just start my contribution by doing something that I have not done yet in this debate. There has been some acrimony during the debate—it has been quite heated—so I want to take the opportunity to thank the Minister for Building and Housing for giving us the chance today to debate proposed Part 3 of this bill. Without him, we would not have had this chance today to debate this excellent proposed Part 3 put forward by my colleague Phil Twyford. We have not had the opportunity to debate a policy of this depth, and one that will make this much difference to the supply and affordability of housing in New Zealand, until today, so I want to thank the Minister for Building and Housing for bringing this omnibus bill to the House so that we can have this debate today.

I want to pick up my colleague Phil Twyford’s comments about what the Minister said yesterday, because the Minister did give an acknowledgment yesterday that the Auckland housing market was out of control on the one hand—

Hon Dr Nick Smith: Did not.

GRANT ROBERTSON: —that’s exactly what it said—and then, on the other hand, that he had no plans to change his approach. They were the two options: yep, it is out of control, but the Minister has no plans to change his approach—a continuation of his head being placed deeply in the sand, unable to see that he might have an alternative. So today in proposed Part 3 we have that alternative for the Minister. We are answering his question, and it is the implementation of a measure that will actually build affordable housing. The Minister, when he came to the House yesterday, said that this bill was about improving the supply of housing and improving affordable housing. We reluctantly supported Part 1 as having a minuscule impact on that point of increasing supply and increasing affordable housing. Now here we are in proposed Part 3, where we are really doing it, with 10,000 affordable houses per year—10,000 affordable houses per year. Is this needed, Mr Chair, you may well ask? Well, it most certainly is, because we know that we are thousands of houses short of what is needed in Auckland and around the rest of the country.

A lot of the debate on this bill so far has focused on Auckland. I want to make the point that proposed Part 3 does not specify Auckland, and for a very good reason: there are other areas of New Zealand facing housing stress right now when it comes to affordable housing. This could apply in areas like Wellington, Tauranga, and Queenstown—the places that are really under stress at the moment in terms of whether or not there is affordable housing. So this is needed. We are around 40,000 houses short since National came into office, in terms of what is needed in Auckland for the pipeline of affordable housing. In this proposed Part 3, somebody is finally stepping up in this House and saying: “We’re going to put a number on it—10,000 houses per year.”

No doubt, should those members get off their chuffs and get up, we will hear the negativity from National telling us that it cannot do this and that we do not have the labour force. That party used to be ambitious for New Zealand, but that is all gone. It is all negativity. Well, here is the chance. They can recapture some of that ambition and back proposed Part 3—10,000 affordable houses.

But there is more. There is more in this proposed Part 3, because Phil Twyford has put this up not just with a pipedream of 10,000 houses but with a plan to do it. “Within six months of the completion of the plan required under subsection (1)” to build those 10,000 affordable houses, that copy will come back to this House. That is about democracy. That is about making sure that this House knows that this will happen. This is not just a Government coming here saying: “We’re going to have a special housing area and there might be some houses here and there might be some houses there.” This is an actual plan that will come before this Parliament. And then the Minister for Building and Housing—now, this might be a stretch for the current Minister, but we will see—“must ensure that all targets set out within the plan are met and report to the House of Representatives annually on its progress.”

So rather than the Minister’s current approach, which is to deny and divert—

Hon Gerry Brownlee: Are you on Part 3?

GRANT ROBERTSON: I am on Part 3. I am reading it out, Gerry, actually.

Hon Gerry Brownlee: Part 3?

GRANT ROBERTSON: Yeah, yeah, yeah. Part 3—right here.

Hon Gerry Brownlee: We’re reading your proposal. You’re mixed up.

GRANT ROBERTSON: No, no, no. Part 3—right here.

Hon Gerry Brownlee: A little confused.

GRANT ROBERTSON: No, no. Part 3—right here, mate.

Hon Gerry Brownlee: Someone give him the right bit of paper.

GRANT ROBERTSON: Part 3—right here. It is all good, Gerry. It is all on the amendment.

This is the problem with the Government: it does not understand. It does not understand that it actually takes Government leadership to get affordable housing. That is what Part 3 will deliver. The Government should back it. It has not done anything else that is useful in terms of affordable housing.

Hon Dr NICK SMITH (Minister for Building and Housing): I welcome the opportunity to debate Part 3, which has been put forward by the Labour Opposition in a proposed amendment in the name of Phil Twyford on this bill, because it exposes for everybody to see what a bunch of flakes those members are when it comes to housing policy. What this bill says is that if we just simply pass a bill that says that 10,000 affordable houses will be built each year, whammo! Magically, it is going to happen! That is all you need to do. It is sort of like, you know, we could pass a bill through the House and say: “Let’s pass a bill that says everybody has a job. Let’s pass another bill: everybody be cured, and everybody be healthy.” That is the sum total intellectual grunt of the Labour Opposition—a magical, one-page amendment that is suddenly going to get 10,000 houses a year built. It is laughable.

What is so contradictory is that when we had the first part of this bill, which would actually have provided some land to build houses—oh, they are all opposed to that. They do not want us fast tracking the land planning process to get the houses built. Then when we come to say “Well, actually, we think we should use some vacant Crown land to build the houses”—oh, no, no, no, no. The Labour Party says you cannot do that. All you have got to do is magically pass this proposed Part 3, and you will get 10,000 homes built.

Here is some news for the Opposition: the number of new homes that are being built is growing at the fastest rate on record since 1922—

Andrew Little: Half the rate of 1974.

Hon Dr NICK SMITH: —since 1922. No, no, let me just take Mr Little through it. In each of the last 4 years, Mr Little—each of the last 4 years—residential investment has grown by more than 20 percent per year. It grew by 20 percent in 2012, another 20 percent on top of that in 2013, another 20 percent in 2014, and then again in 2015. Here is a challenge for Mr Little: tell me 4 straight years ever in the last century that you have had more than 20 percent compound growth in residential construction. Tell me when ever.

Andrew Little: 1974 to 1978.

Hon Dr NICK SMITH: He says 1974. Let us get the data—I have got it in front of me. In 1974, under the Kirk-Rowling Government, when inflation was running at 15 percent, and they offered mortgages at 3 percent, you had one year in which house building boomed, and then the country was paying the bills for it for the next 10 years. If Mr Little’s model is that of a failed Government, the 1972-75 Government, man, I want to be telling the electorate that, because the financial damage that was done at that time was a debacle. It was a 1-year boom, and it bust the following year.

What is different is that this is a sustainable housing programme. This is a programme that has seen growth year after year, 4 years in a row. Independent programmes show that in the next 3 years there will be record levels of building in Auckland, to the point that a city the size of Whangarei is being built in this term of Parliament, and in the next term of Parliament there will be another. Here is the problem: when it comes to Resource Management Act reform, the Labour Party is opposed. When it comes to offering first-home buyers the help in getting a deposit with HomeStart, they are opposed. When it comes to fast tracking a new unitary plan for Auckland—

Phil Twyford: We voted for your HomeStart.

Hon Dr NICK SMITH: —they are opposed. When it comes to reform of the social housing sector, I actually do not know whether they are for or against, because one minute Mr Twyford is in favour, and the next minute he is against. Actually, every member of this Committee knows that Parts 1 and 2 of this bill will get more roofs over people’s heads. They will get more houses built. Actually, will I ask Sir Noel Robinson? Sir Noel Robinson says this bill is the difference between 500 houses being built in Papakura, or not—500 houses in Papakura.

Phil Twyford: We voted for that one, Nick. We voted for that part of it.

Hon Dr NICK SMITH: No, actually, you voted against urgency and you voted against the introduction of this bill. Let it be plainly on the record that you blocked those. I say to members opposite that you cannot have a Wailing Wall of concern about people who are under stress on housing, and then come down to this Parliament and oppose every practical measure that we bring to get houses built; every practical measure, Mr Little, you have opposed. Mr Little and Mr Twyford are not interested in solutions. They are interested in playing the politics, getting the Wailing Wall of their inquiry, but when it actually comes to the measures that will get homes built, they are opposed. When you want to do things that will get houses built, they are opposed.

So I ask them this on this bill: why is it that the Auckland Council supports this bill, but the Labour Opposition does not? I hear from Labour all the time that we should be listening to local government. Why is it that Local Government New Zealand supports the extension of the special housing areas, but Labour and the Opposition parties do not—do not?

Actually, it is really strange—over the adjournment, Labour said “We are going to declare a state of emergency over housing.”, and then we come to the House and we say “Actually, there’s a really practical thing we can do to get 8,000 houses built, and we need to go into urgency to make sure those 8,000 houses are built.”, and what does it do? It opposes urgency. So can the next member speaking for Labour explain why they want a state of emergency declared on housing, but why they will not sit down and do the hard work in this Parliament and pass the bills that are necessary to get the houses built.

MARAMA DAVIDSON (Green): Whoo! Who got the Minister going again? We are now debating new Part 3, which is my colleague Phil Twyford’s amendment to the Housing Legislation Amendment Bill that proposes to ensure that there are 10,000 affordable houses per year planned for, and specifically for, first-time buyers. So that is affordable. Then our Minister for Building and Housing got up and talked about the Opposition members being flakes.

Gosh, Minister, we really need thousands of affordable homes. We need thousands of specifically affordable homes, not just your homes that you are planning to build that will then be available for speculators—because they are the only ones who can afford those homes—to be able to use for building business and capital for their own wealth, which also then gets passed on to renters, who will have to be the avenue for those speculators to recuperate their capital put-down.

That is what happens when you do not ensure affordable homes. Not only can ordinary New Zealanders not buy those homes, but renters are forced, more and more, to live in homes where speculators are able, in this current market, to charge enormous rents—rents that my colleagues Phil Twyford and Marama Fox and I heard at our homelessness inquiry are diminishing families, absolutely destroying families. There was never a more urgent time when we needed thousands of affordable homes.

The Minister has just stood up and declared in this Chamber that we cannot fix it. That is what he just said. He said that we cannot fix it and that we cannot have the vision of having affordable homes for our country, and he accused the Opposition members of being flakes for even suggesting the idea. That is what he just did in this Chamber, ladies and gentlemen and all genders. He just stood up and declared that we cannot have this vision—we just cannot. That is this Government, ladies and gentlemen. We just cannot have this vision of the thousands of affordable homes that this country needs.

We need them. Take all your resources, Government, take your special knowledgable people and work it out, have a plan—that is what new Part 3 is talking about. Come up with a plan. I do not want to hear about however many houses are being built now compared with whatever other time. You should have come and sat at the table at the inquiry, looked those submitters in the eye, and had a profound understanding that we need thousands of affordable homes. This Government can do it but it is choosing not to, and that is having an impact on the everyday lives of our people—our own people. Children, the elderly, families, and single people across the board need us to have that vision for our country.

New Part 3 is asking for a plan—a plan to ensure that the Government will do it, because the private developers will not want to, and they have not. That is why the current bill that we are debating is even in this House, because the developers are not going to provide affordable homes. The Government has to. If it had any profound connection to our communities, it would understand this, and it would instead get up and declare: “We can fix this. We can provide thousands of affordable homes because our people need them and it will get worse if we don’t. We will gather our resources, our technology, and our expertise and we will sit down and work out a plan.” That is all that this new Part 3 is asking to do. At least have that ambition for our families, Mr Minister. At least declare that you want to end homelessness and that you have a vision for every person in this country to have a warm, safe, and affordable home.

That is the vision that our country is wanting, and do you know who else had this vision? I will tell you. It was your own Prime Minister. In a debate in, I think, 2008 with the Rt Hon Helen Clark, he was asked: “How do you define ‘rich’?”. The now Prime Minister, the Rt Hon John Key, replied: “Where a family can go to sleep every night in a bed, without having to worry about money.” Who does he think deserves that security? Who does the Prime Minister now see that vision is for? That is the definition of “rich” that he gave, back in 2008, but who does he think deserves even to go to sleep in a bed every night, let alone not have to worry about money?

Not all of our people are going to sleep in a bed every night, and if they are, that bed might change the next night. This new Part 3 of the bill is an incredible part of the journey to change that, Minister, and you have just stood up in this Chamber and said that we cannot do it. Your Government has just declared that you cannot fix this.

Well, I am glad that the Greens have a plan to. I hear that Labour has a plan to. We are the people who need to be in Government so that we can fulfil our vision for New Zealanders to absolutely not have to go to sleep at night in their beds worrying about money. That is what we heard in the inquiry, and that is being reflected in the poll result that my colleague Phil Twyford referred to earlier, where even New Zealanders who are not experiencing homelessness themselves right now understand that it is wrong—60 percent understand that this is not cool. This is not cool, Minister.

Our country can do better. We have our people as our wealth. That is our richness, and we are not protecting them. This new Part 3 of the bill, from my colleague Phil Twyford, is an incredible step in that direction. Where is your aspiration for our people? Thank you.

Hon GERRY BROWNLEE (Minister supporting Greater Christchurch Regeneration): I just want to make a couple of comments about the speech we have just heard from Marama Davidson. It was delivered in a loud, tub-thumping style that relied heavily on what was supposed to be an emotional plea to consider the proposed part that has been put forward by the Labour Party. The first question I would ask is does that member bother to look at the processes that are available—through the select committees and the question facilities available to members—to actually find out how many houses are being built in New Zealand at the present time, to notice what is the increase in the number of houses being built in New Zealand, and to understand how many houses the Government is actually building in New Zealand, over and above the private sector? And then, has she thought for a moment to consider why it is that developers are building houses that people apparently cannot afford? Developers do not do that. They build houses that people can afford. If they are in an upper price bracket, that frees up others in the market. That is how markets work.

But it is not at all how the Green Party thinks. The reality is that when the calls are coming to “get a plan”, it is really saying: “We love sitting in a windowless building, listening to the misery of people, and pretending that we care.” Because that is what it is—pretending. Anyone who votes against this bill today is just pretending that they care about people. Opposition members love the opportunity to get in front of the television and say “Isn’t it awful? Isn’t it terrible?”, but they will not do a single thing to make it move.

The speech offering from Dr Nick Smith was absolutely right. Every initiative that the Government has put forward to advance more housing being available on an affordable basis for more New Zealanders has been opposed by all of the Opposition parties—all of them. I think that it would be worthwhile for the Minister in the chair, Dr Nick Smith, to reiterate all of the facts that were in his contribution before, in the hope that they might sink in. The reality here is that no plan—no plan—around housing can be delivered without the land, and this bill is about making the land available. Everyone knows that if it is available, it will be built on. If it is available, it will be built on.

I just want to say to those people who get all excited about the average house price in Auckland—they all say: “Isn’t it terrible? It’s hit $1 million.” Well, those people need to consider what averages are. They need to go and have a look at TradeMe, they need to go and have a look at New Zealand real estate—

Chris Hipkins: Let them eat cake—let them eat cake.

Hon GERRY BROWNLEE: —and actually have a look at where the vast majority of houses and the prices on them sit. The reality is—I know that Mr Hipkins was absent last night. I cannot say he was absent from the House, but he was actually in the vicinity of Parliament watching the Auckland housewives programme. He was telling me about that this morning. He was fascinated that one of them was considering buying a $7 million property and saying it would be lovely for their family. That is not reality; that is somebody else’s dream. But that house will sell at that price and it will affect the average that is paid for an Auckland house.

It does not, though, reflect the average aspirations of people who simply want to live in a house, or what they can afford to pay and what is available to them in the market. So for all the impassioned pleas that we got from the member earlier saying “Please, sit in a room, join with all the best brains,”—apparently they are all in the Opposition—“and come up with a plan for sorting out affordable housing.”, without the land, that is not possible. This bill is about making that land available.

I also take issue with the commentary from Phil Twyford.

Phil Twyford: On or by?

Hon GERRY BROWNLEE: No—well, by. I can understand why he would take issue with the commentary on him, but I want to assure him that I do not listen to too much of that. I think he is one of the better-performing members of the Labour Party. He deserves his place on the front bench and, in that regard, he is a shining light among what is a pretty dark offering, or—that is not fair either—a dim offering. When he talks about the fact that Labour supports initiatives to increase housing in New Zealand and to increase the amount of affordable housing in New Zealand, his argument—

ANDREW LITTLE (Leader of the Opposition): I understand why the Hon Gerry Brownlee is so dismissive of averages, because that was a below average performance, the likes of which we have not seen for a long, long time in what has otherwise been a scintillating political career.

I want to respond to some of the assertions made by the Minister in the chair, Nick Smith, who, in typical National style, has heralded the great, bounteous virtues of its excessive building programme, claiming to have stated facts, but there was not a fact amongst them. The reality is that when you look at the house-build programme at the moment, it is below the number of houses that were consented in 2004. Last year there were 9,651 houses consented, compared with over 12,000 in 2004—so much for the biggest building programme ever in the history of New Zealand.

But here is the telling figure. Here is the telling figure. If you have a look at the build rate per 1,000 people in New Zealand—because, let us face it, when you have got a bigger population, of course you should be building more houses. We have got more people and we have got a rapidly growing population. We have got to build even more houses. But if you have a look at the number per 1,000 people, sure, it is 6.3 in the past year, compared with 13.1 in 1974.

The Minister dismisses those figures and says “Oh, but look at interest rates in 1974.” Well, actually, a lot of those people were building houses under the State Advances Corporation rate of 3 percent. And then he says inflation was much higher. But hold on. We have got record low inflation right now, as measured by the CPI, we have got record low interest rates, and people still cannot afford to buy their first home. That is the truth about New Zealand today.

Unaffordability of housing has never been worse or greater or better—however you look at it. Here is the thing: a lot of people cannot buy their own home. That is what is happening in New Zealand today. And if you are living in Auckland—and Gerry Brownlee might be dismissive of the $1 million home. He sort of says “Well, just because on this day somebody pays $7 million for a house it doesn’t mean to say that a house down the road is worth as much.”

I do not know whether he understands things about property markets, because that does not make sense. What is happening right now is that in Auckland, and in other cities around New Zealand, thousands and thousands of New Zealanders—people who live here; some of whom have been born here, others who have come here to live—cannot afford to buy their own home because the prices are out of reach and the banks are clamping down on lending. The people trying to get the houses are working harder and harder, and saving harder and harder, and they still cannot afford to buy their own home. If they are lucky to have rich parents who can back them and bail them out, they might get their home. You hear the stories of young couples with mortgages of $800,000, $900,000, a million bucks. They are in their 30s, and they are on salaries of 60,000, 70,000, or 80,000 bucks. They have a pretty tough time. They are terrified that one of them might lose their job. They are terrified that something might change their circumstances and they will be out on the street. That is the reality for far too many people today.

And then there are those in other parts of Auckland City and other parts of the country who want much more modest housing and who simply cannot get it, or whose incomes are so low they are dependent on renting, and the rents have gone sky high and they cannot even afford to rent. That is why Part 3 of this bill is so vital. It is part of the endless supply of ideas that the Labour Party has to come up with in answer to the housing crisis.

The Minister scoffs at the call to have emergency powers or to declare a state of emergency on housing. It is a crisis. We are in a housing crisis. We can do better. The miserable kinds of millimetre-by-millimetre measures that this Minister is taking are simply not good enough. They are not helping enough people in a timely enough fashion. We have to do better. Part 3, with its promise of a Minister having to prepare a plan for 10,000 houses each year, is just the start of the comprehensive package and the endless supply of constructive and positive ideas that the Labour Party has. That is why we did support the special housing area amendment, which we have just voted on, and we will support any constructive measures that will get more houses built and more New Zealanders into their own home.

DENIS O’ROURKE (NZ First): New Zealand First will vote in favour of proposed Part 3 of the bill, as tabled by the Labour Party, and will do so with considerable enthusiasm because it deals with developments and the development of affordable houses. The Minister for Building and Housing does not seem to understand this, and Gerry Brownlee especially does not understand it—that this is what people want, and it is not what they are getting under this Government. This proposed Part 3 is completely consistent with New Zealand First policy, in contrast with National’s vacuous claim that it has a comprehensive housing strategy when, in fact, it has none—just a litany of failed policies, including the special housing areas, which have delivered only 1,300 houses over the last 3 years. All of that shows that this National Government is just a bunch of dead-heads, do-nothings, and dripping dipsticks when it comes to housing.

This new part is, instead, exactly what this country needs—exactly that this country needs.

Hon Gerry Brownlee: Double the number of houses by doubling the number of letterboxes!

DENIS O’ROURKE: What this country does not need is a Minister like the failed Gerry Brownlee, in every portfolio that he has got. What New Zealand First wants is a housing commission. We want a housing commission reporting to this house so that it can carry out the long-term strategic planning that has never really happened for housing in this country. We want to see that happen, well-resourced with people who know what they are doing, who are out of the political arena, and who can do it objectively and effectively. We also want that body to establish a company, which we call “Kiwi Housing”, and we would want that company to buy developed land, sell it on easy terms, or sell already-built houses to the public. That is exactly what we want the Government to do, and we want that to happen because we know that the private development market in this country cannot cope with the current situation. It has not been able to cope for the last several years, yet this Government says: “Let’s hand more and more of the responsibility for that over to them.” That is all it is doing—nothing more. That is absolutely not enough.

What New Zealand First targets as housing, for the whole of New Zealand but especially for Auckland, is 20,000 houses per year. I am not just doing one-upmanship over the Labour Party; this is based on my reading of what is required under the Auckland Unitary Plan. Over 7 years that would amount to 140,000 houses, and the Auckland Unitary Plan indicates that that is the scale of housing that is actually required. A target of 20,000 houses a year by the Government, with direct Government investment, is actually completely achievable. That Minister in the chair, Nick Smith, does not think so. That is because he is not capable of it and neither is his whole Government, but anyone with any ability and any determination and the right approach to housing would be capable of it.

When I look at the last part of this proposed Part 3, I can see that it does some very important things in terms of what it is about, and that is to ensure that houses are affordable. I am not going to get into the argument about how you define affordability because all we need to do is ensure that the new entities I have spoken of would ensure that houses actually get built, effectively by the Government and by direct investment in homes, and in homes that are on modest-sized sections—modest-sized homes—and for, therefore, modest prices. Not only that, there need to be mechanisms for people to be able to buy those homes directly on easy terms. That is also in New Zealand First’s policy, and it should be the sort of thing that we would see happen under the provisions for proposed new section 50U, “Corporation to manage affordable housing development”, under this proposed new part of this bill.

Other parties do have comprehensive and actually effective housing plans and strategies, which this Government does not have. That Minister, the “Minister of Homelessness” in this country, should step down, and the whole Government should get out of Government in this country and let others do what we can do.

Hon Dr NICK SMITH (Minister for Building and Housing): We now have a bid-up on the flaky, one-page policy from the Labour Party, which says, with a one-page amendment, we will magically build 10,000 affordable houses per year—we have got the New Zealand First policy. The New Zealand First policy is that we just put a one-page amendment and we magic the number—let us do 20,000 houses per year, with a one-page amendment—and, magically, we have suddenly built the houses.

The very first point is—because I know there are colleagues on the Opposition benches incapable of reading, so I have done a really simple graph. This is the level of residential investment, in inflation-adjusted terms, of about the last 25 years—25 years—and what it shows—

Hon Annette King: What’s the source?

Hon Dr NICK SMITH: —is that over the last—oh, the member says: “What’s the source?”. The source is Statistics New Zealand, and it records the level of residential housing investment—and guess what? It shows that over the last 5 years there has been the biggest increase—20 percent growth every year, for 5 years—in the amount of new home construction and residential investment in New Zealand. But I can do even better than that—I have got the figures all the way back to 1922. So I have another challenge: tell me the years—and I say it to New Zealand First, I say it to the Green Party, I say it to the Labour Party—tell me 4 years any time in New Zealand’s history in which there have been faster real increases in the level of housing investment.

I have got another lovely graph that I would like to share with the House, and this is a graph—just for the excitable members of the Labour Party—that shows the level of ratio of house prices to average earnings. Again, this is prepared by Statistics New Zealand. What it shows is that in 1999 the ratio of house price to income in New Zealand was 4:1—4:1 in 1999. Members will know there was a huge deterioration—see, the graph leaps up. Things completely went to custard—and what years were those? That was from 2003 to 2008. The ratio went from 4 to 8. My question is this: what Labour housing legislation did we have between 2004 and 2008? Zero—not a single bill. We had the worst deterioration in New Zealand history and you did absolutely nothing, and then between now and 2016, that ratio has not moved. So I say to Labour members: shame on you. The worst deterioration occurred in housing affordability, and they did absolutely nothing. Over the last 4 years we have seen the strongest growth in residential construction ever.

Here is the last point I would like to make: this magical amendment says that you can build 10,000 houses every year. I have got a lovely quote here from Mr David Parker from the 2014 election campaign. He said this: “It would not be possible to build 10,000 houses in our first year, nor our second year or third”—

Hon David Parker: Oh, rubbish.

Hon Dr NICK SMITH: That is what you said. In fact, you said: “it would take us 5 years to ramp it up to 10,000 homes per year.” That is what he said—but do you know what?

Hon Annette King: Come on, sunshine—what’ve you done?

Hon Dr NICK SMITH: I will tell you what we have done: when we came to Government, New Zealand was building 13,000 houses a year, and that number is now 29,000 per year.

Hon GERRY BROWNLEE (Minister supporting Greater Christchurch Regeneration): I seek leave to present some statistical information, which I will shortly acquire from the Hon Dr Nick Smith.

The CHAIRPERSON (Hon Trevor Mallard): Can I ask the member whether it is material that is otherwise publicly available?

Hon GERRY BROWNLEE: Well, it will very soon be available on the Hansard record, and I would advise anybody interested to read it there.

The CHAIRPERSON (Hon Trevor Mallard): No, no. Can the member just answer the question—

Hon GERRY BROWNLEE: That would be publicly available.

The CHAIRPERSON (Hon Trevor Mallard): It is publicly available. Then I am not going to put the leave to the Committee, based on the precedents from my predecessors in the Chair. Has the Minister finished?

Hon Dr Nick Smith: Yes.

The CHAIRPERSON (Hon Trevor Mallard): Well, I think, on that basis, the next speaker had better be the Hon David Parker.

Hon DAVID PARKER (Labour): The point I was making before the election, of course, is that KiwiBuild, in addition to all of the houses that are currently being built by the private sector, would add to supply. Of course it would not add to supply overnight, because you have got to issue contracts and you have got to get planning consents. We promised that we would build 100,000 extra affordable houses over a 10-year period. The Minister for Building and Housing, in the last day or so, with Paul Henry, admitted that the Auckland housing market is out of control—the first time that he has admitted that there is a crisis, but he still will not use the word.

I heard our colleague from New Zealand First describe him as the “Minister of Homelessness”. I prefer the alliteration of the new term that has been devised in this debate, which is the “Minister of Houselessness”. I think that is going to stick. Minister, why is it that we are bringing forward all of these credible additions to housing policy to fix this problem? It is because we do have a state of emergency. We have got the lowest rate of homeownership since the 1950s, and it is still going down. We used to have higher rates of homeownership than Australia; now we have got lower rates of homeownership than Australia. The average house price in Auckland has risen to $1 million, and the median has gone up too. We have got people living in garages, in cars, on the streets—

Andrew Little: Under bushes.

Hon DAVID PARKER: —under bushes, and under bridges. We have got homelessness in numbers that we have never seen, ever in the history of New Zealand. We have got economic consequences that are going beyond the housing market and into the rest of the economy, where exports are down and speculation is up. We have got people having to spend far too much on housing, and they are not investing enough in the real economy, which is where jobs and higher incomes come from.

We have got Reserve Bank policy now ineffective because the banks are not passing on interest rate cuts. The banks are saying that prices are parlously high, and they are worried that if they drop interest rates they will feed the bubble and make things worse. In the midst of all that, we have the “Minister of Houselessness”. Cartoons in the last day have shown that he has not got the screen appeal of Agent 86, but the Maxwell Smart of National does seem to be embarking on operations for KAOS rather than for the Government.

We have heard from the Minister who has just sat in the chair, Gerry Brownlee. His answer to New Zealand when he said that these higher prices do not matter was: “New Zealanders, follow my example; eat cake.” We have had the saboteur from National come forward with a policy that says that we need an omnibus bill. Why did the Government do that? It wanted to whack through, under urgency, changes to the long-established principles under the Public Works Act that people, as part of their rights if they have a property taken off them compulsorily, should actually have it offered back to them in some circumstances. It wanted to change that rule of decades to preserve it for a subset of the population, which is Māoridom, but for non-Māori rights holders, in respect of land previously compulsorily acquired and then disposed of, it did not want to confer that old right.

So what did the Government do? It had this clever idea of an omnibus bill. The Speaker ruled that in order for that to be justified, this has to be a wide debate. So, as a consequence, it has offered the Labour Party the ability to put forward comprehensive housing policy as to how we would fix this housing crisis, which brings me to Part 3. Mr Chairman, you will hear other parts, I am sure, relating to some of the other matters that the Minister in the chair, Gerry Brownlee, raised recently, relating to the need for Resource Management Act reform, and we have got some ideas around urban boundaries that we have already announced and will be discussing later in this debate. But this one is actually getting the Building and Housing Group, through the Minister for Building and Housing, to bring forward a plan for affordable housing. You know, of the 1,300 houses that have been built in these affordable housing areas, fewer than 150 of them have been affordable, but we need tens of thousands of affordable houses, and 150 from this failed special housing area shows we need this plan.

STUART NASH (Labour—Napier): The reason why new Part 3 is such an anathema to the Government is that it lists, in this first clause, everything that the National Government is not doing. But, first of all, let me just address a couple of things that the Hon Gerry Brownlee said.

What Gerry Brownlee did was he highlighted the major difference between the National Government and a Labour Government. Mr Brownlee believes that the market will deliver optimal outcomes, always. So you leave it to the market, the Government does not have to do anything, and away you go—you will get optimal outcomes. A Labour Government believes the Government actually has a role in providing the settings and the regulation and an environment where citizens actually can do well, and when markets are not working, then the Government must step in. And this is why new Part 3 of the bill actually delivers for Kiwis. It is Labour’s attempt—it is Labour’s solution; it is its plan—to say: “Do you know what? At this point in time the market isn’t working. The Government has a very important role to play, and this is a plan.”

Let me go through new section 50T(1) in new clause 12 and highlight the words that actually make this work. The first one is “must”—“The Minister of Housing must”. It is not “may”. It does not denote any sort of voluntary, subjective actions; it says that the housing Minister “must” do something.

Let us use this in an ordinary context. “He must turn up or else he will be in serious trouble.”—it is “must”. Throughout this bill that we are debating at the moment, there are a whole lot of “mays” and this sort of stuff, which means that the Minister might do something if he feels like it.

The second word is “prepare”. What “prepare” actually means is you have got to do some serious work—not ad hoc, not get a bill and rush it through under urgency, not sort of hoodwink the people, but you have got to do some serious work. So the housing Minister “must prepare”.

The next words are “a plan”. “A plan” means you have actually got to have something that you can deliver. Again, it is about work, but it is also about putting a vision out there—something that you can take to the public that they can take hold of and believe in.

So what we have got so far is that the housing Minister must prepare a plan. Now, here is the big word: “in consultation”. What “consultation” actually means is sitting down and understanding the issues from the people who really know what is happening. It means really getting a grip with those who are going to have to deliver them, those who will end up benefiting from them, and those who have got to end up making the laws. Rushing legislation through Parliament under urgency is not about consultation.

Doing what Nick Smith is doing at the moment without consultation is not good law, and that is why, yet again, we are back here. You know, I have been back for, what, 18 months, and it seems that the majority of the bills that I have been speaking on are remedial bills that are amendments to sort out a bill that was passed 1, 2, or maybe 3 years ago. It is just really sloppy, because I do not think that the level of consultation has been strong enough or robust enough to actually come up with good law in the first instance.

The fifth word that I want to highlight is actually “delivery”. “Delivery” actually means achieving results—not talking about it, not saying “We will do this.”, but actually achieving it.

Let us put this in ordinary usage—for example: “He delivered on his promises.” That means that what he did is he came through with what he said that he would do.

The sixth term is “10,000”—“10,000” sounds pretty simple. It is 100 times 100, or 10 times 1,000. It is not 1,300 into 70,000. It is actually a defined target that we will meet. It sends it out there, and it is a promise that we will deliver on—10,000. People understand it, and it will make a difference.

The seventh word I want to talk about is “affordable”. The definition of “affordable” has been talked about for the last 24 hours in this Chamber, but “affordable” is not over $500,000. “Affordable” means that people have a realistic chance of actually getting into the market. They know that they can have an aspiration, they can have a dream, and they can have something to look forward to because they know it is achievable. “Affordable” means that New Zealanders can have a chance.

And the final one is “first home buyers.” I am not talking about speculators; I am not talking about overseas investors. So when you add this up, it says: “The Minister of Housing must prepare a plan in consultation … for the delivery of 10,000 affordable houses per year for first home buyers.”

CATHERINE DELAHUNTY (Green): Tēnā koe, Mr Chair. Tēnā koutou e Te Whare. I am delighted to see some passion in this Chamber. Unlike Minister Brownlee, passion is what this is about. Nick Smith showed enormous passion. Passion for development, passion for investment, passion for speculation, passion for business as usual, passion for ignoring Part 3, which is proposed in an excellent amendment from the Labour Party, which has given us something to hope for and hold on to in this ridiculous debate, which, prior to that, was about nothing useful at all. So if people want to dis members of Parliament for being passionate, they better not go out there on the street—

Carmel Sepuloni: They better not!

CATHERINE DELAHUNTY: They better not go—

Hon Member: Don’t show passion!

CATHERINE DELAHUNTY: Do not go out there and tell people to not be passionate. If you are sleeping in your car and you wake up in the middle of the night, the person is passionate to have a home. And how does it go down in the Chamber? “Don’t get passionate, Marama Davidson. Don’t show any feelings. This isn’t about feelings. Let’s get some graphs instead. You cannot build a house out of a graph, but if we get up a whole lot of graphs, it will look like we’re doing something.” Fail, fail, double fail.

I want to just congratulate the Labour Party on actually having a plan, because we have been fighting about housing in this House for a few years, and the Labour Party has got a plan that we can all buy into because it has got specific targets for actually doing something for people. The homelessness inquiry backs up what this plan talks about. The homelessness inquiry backs up the need for passion. What makes change is passion; it is not graphs, people. Nobody gets passionate about a graph except people who do not understand what passion is.

Marama Davidson: Or connection.

CATHERINE DELAHUNTY: Passion and connection are the most important things for families who feel like they are being ignored by this Government.

It is a bit like swimmable rivers—the same Minister says we cannot have swimmable rivers because it is all about birds. This same Minister is talking about housing, “We can’t have affordable housing because”—dot, dot, dot, dot, dot. “The graph says everything’s OK.” It is all about “no”, it is all about “not”, and it is all about “won’t”.

Let us get on to Part 3, because this is about something constructive, and I want to tautoko the comments of the previous speaker, Stuart Nash, who looked at the language. Language is important. Language is critical. The language that he referred to is very, very important. It is really important that there are dates in this Part 3 amendment. It is really important that it says: “Within six months of the completion of the plan … the Minister must present a copy of the approved plan to the House of Representatives.” Wow, that sounds a little bit real—6 months!

If you are living in a car, 6 months seems like quite a long time to wait, but I think people understand that; if there is a plan they would be prepared to hold on. They would be prepared—as have Te Puea Marae, Manurewa Marae, and all the marae—to say there needs to be a plan, and that they are working towards a plan. But this bill, this ain’t a plan. Except for this part, this bill ain’t a plan. Well, it is if you are passionate about investment, if you are passionate about speculation, if you are passionate about taking away land that belongs to Māori, if you are passionate about looking like you are doing something when you are really not doing something—yup, it is a plan for that. But it is not a plan for people who are homeless, not a plan for first-home buyers.

What I like about this plan is that it acknowledges—and I said this last night when I talked about the State Advances Corporation and the ability that we had in my day. Not that it is over; I am still passionate, obviously. In my day, you could get a home as a first-home buyer and start your life. That is what this part actually says—it says you can do those things: “Ensure that the houses are sold to first home buyers and are not used for speculation;”. Oh my goodness, a rule about speculation! Praise the goddess, somebody cares.

I do not want to hear from a Minister of the Crown in any Government that it is faux emotional to give a damn about homelessness, about houses being inaccessible and unaffordable. If the Government has completely lost touch, that is one thing, but we have not. The people on this side of the Chamber, we are prepared to do something. We just want to do something, because if we do not do something, the fabric of our society means that everyone will sleep badly. The rich will sleep badly inside their speculator-driven, investment-rich barbed wire fences and, on the outside, the poor in their cars and garages will sleep badly as well. So we need to stand up for this.

Su’a WILLIAM SIO (Labour—Māngere): Earlier, the Hon Annette King asked the Minister where the regulatory impact statement for Part 2 was. The Minister responded by saying that we should take his word for it—that nothing untoward would happen—and the image that came to mind was President Richard Nixon when he said: “I am not a crook. I am not a crook.” We all know what happened to him.

Later on, the Minister came down to this Chamber and showed some graphs to show how good a job he has been doing, trying to tell us that the supply of housing has increased under his ministership. But I have to say, he was so animated in that contribution that all I could see was the image of somebody that needs to be in a straitjacket and not have anything to do with housing—

The CHAIRPERSON (Hon Trevor Mallard): No, no. The member will resume his seat. I think the member has gone a little bit far there, and he should be more restrained in his comments.

Su’a WILLIAM SIO: The Minister asked this Committee to explain why there is a need for a state of emergency on housing. I want to spend a bit of time talking about that, because, despite those graphs, we have today the average price of housing in Auckland at $1 million. Why is that? Because there is a short supply of housing—a short supply of housing—and we have an increasing population. Today, as of last year, we have the highest population increase since 1974.

The Minister, I believe, is wrong when he brings those graphs down and says that he has been doing a good job. The only reason house prices are, on average, over $1 million in Auckland is because the Government has not done its job in increasing housing supply. Why is it that since this Government came into power, homelessness—people living in cars—has increased by 20 percent? That is why we are calling for a state of emergency. Why is it that today we have 42,000 people living in cars, living in overcrowded conditions?

Part 2—and I have heard Gerry Brownlee say this is about increasing the number of affordable houses. I do not understand how Part 2, which is about removing the rights of people, is going to be able—

The CHAIRPERSON (Hon Trevor Mallard): We are debating Part 3.

Su’a WILLIAM SIO: —to increase the supply of affordable housing.

Part 3, however, is what ought to be happening. This is the part that discusses the exact number of houses that should be a target. Part 3 is about having a plan to increase supply. Nothing in Part 1 or Part 2 suggests that the supply of housing will increase, so this is what needs to happen. The Minister says that his Government is doing all it can, but the reality is that unless it addresses the supply of housing, unless it cracks down on foreign speculators, unless it changes what the real purpose of Housing New Zealand ought to be, none of that will happen.

The purpose of Housing New Zealand, from the outset, was about helping people in need. Those members have changed that, and today it is because of that that we are seeing an increasing number of people in homeless situations. The only way that this Government can address that, if it is sincere about it, is increasing the number of houses—not only in the private sector, but also in the social sector. But how can those members do that when it is their policy to sell off State houses? How can they increase that supply for those in need if they are selling State housing into the private sector? Those are the conflicting aims of what they are proposing, as opposed to what we are introducing here in Part 3.

Unless houses are built, unless houses are affordable, the rest of New Zealand will not be able to buy into the market. At the moment, with the average price of houses in Auckland, it is only the top 10 percent of income earners who can afford houses at those prices. But the top 10 percent of income earners will not be buying houses for themselves. They already have houses, so if they are in the market, it is because they are in the speculative market. The only way that somebody on an average income of $60,000 can afford a house is if housing is made more affordable, and we can do that only by increasing supply.

KRIS FAAFOI (Labour—Mana): I would like to speak to the new clause 12 in new Part 3, and I want to acknowledge my colleague Phil Twyford for putting forward this extremely important part of this legislation. But I do have a concern about it because section 50T(1), in new Part 5B in new clause 12, says: “The Minister of Housing must prepare a plan in consultation with the Corporation …”. I also want to pay homage to my colleague Stuart Nash and thank him for breaking down some of the language around some of the functions that we want to achieve with this new Part 3, but I have serious concerns about its achievability with the current Minister for Building and Housing. That is the point that I would like to make.

If we are asking the current Minister of housing to prepare a plan, we would want a Minister of housing to have experience of preparing a plan, and from what I have seen of Minister Nick Smith in the period that he has been the Minister for Building and Housing, I would say that all of his policy interventions have been, to use a word I do not use a lot, extemporaneous—that is, without prior planning or thought or preparation. What we have seen from the Minister in the past 4½ years, I think it is, of his being the Minister for Building and Housing really has been shambolic. The fact that we are here in urgency extending one of those pieces of legislation points out to me that the Minister has not been experienced or well versed, and he has not had any success in preparing a plan and executing it.

We also do not think that we have any chance of the current Minister of housing delivering 10,000 affordable houses. So what really needs to happen for new section 50T(1)—which is amending the Housing Corporation Act 1974—to be really, practically, put into place is, essentially, a change of Government. If we want someone to act as the Minister of housing and “prepare a plan in consultation”—and we have not seen a lot of that with this Minister, or with the other Ministers of housing, I believe, also. The lack of consultation the day before Budget day showed how much consultation goes on within those three.

There is a lack of consultation in the ability for the current Government to provide 10,000 affordable houses per year for first-home buyers. So this amendment does set to put in a policy that will help address the housing crisis, and if the Government is true to its form—Mr Nick Smith has got on his feet many times and said that we are not serious about building more affordable homes for New Zealand. Well, if Government members are serious about that, then they should, and they could, support our new Part 3. I am not holding my breath, because of the track record of the current Minister for Building and Housing. So although I think it is a great amendment to the Housing Corporation Act 1974, if we are going to really effect it, then for at least the next 12 months I think the Government should consider changing the personnel, because it simply is not going to happen with Nick Smith in the seat.

Then, after the next election, new Part 3 will become much more functional, because Phil Twyford will be the Minister of housing and we will make things happen. We will get affordable housing into Auckland, especially, and into other areas of New Zealand that need it. And it is not just Auckland where affordable housing is needed. It is needed in Wellington, it is needed in areas like Rotorua and Tauranga, and it is needed in some areas in the South Island. Then, finally, the amendment that is being put forward by Phil Twyford—new clause 12 in this amendment, which would insert this new Part 5B into the Housing Corporation Act—will actually be able to achieve something. That is something that this Government has been woefully short of trying to achieve in its last 8 years.

GRANT ROBERTSON (Labour—Wellington Central): Mr Assistant Chairman, thank you very much indeed for giving me the call today. I want to address a couple of points that the Minister for Building and Housing raised in his contribution around the question of affordability of housing and the need for new Part 3, because he really was questioning whether or not there was a need for this and perhaps the Minister in the chair now, the Hon Judith Collins, might like to respond. He raised a couple of graphs with statistics up in front of the Committee that it was felt we needed to know about. Well, I want to draw the Minister’s attention to the fact that he has made international headlines today. It is a huge moment in Nick Smith’s political career. He has made the headlines in the United Kingdom. I will just read you the first paragraph from an article in the Guardian today: “New Zealand has the world’s most frenetic property market, with prices in Auckland now outstripping London, and possibly dashing the hopes of British buyers hoping to escape Brexit.” So Nick Smith is now causing a crisis and chaos not only in New Zealand but also in the United Kingdom. He has gone global with his chaotic ways.

What the rest of this article goes on to tell us is that New Zealand has actually managed to be awarded a silver medal, which has been upgraded to a gold medal by Knight Frank, which has put together international house price rises around the world—a comparative graph. If you do it without looking at it in real terms, Turkey tops the list with a 13.9 percent price increase, New Zealand is second with 11.2 percent—

Hon Gerry Brownlee: Get back to the part—relevance.

GRANT ROBERTSON: —but if you put it into real terms, it is a gold medal - winning performance from Gerry Brownlee and the National Government. The “relevance” from Gerry—the relevance question. This is about affordable housing, and the world is telling Gerry Brownlee that New Zealand is getting to be the most unaffordable place in the world for housing.

I do have to have a caveat. That was today’s news when we got the gold medal. Yesterday we got the information from the OECD that New Zealand has the second most over-valued housing market compared with rents and the second most over-valued housing market compared with incomes. So it is silver medal winning there, but gold medal winning in the latest numbers from Knight Frank, which is why the Minister was wrong in his intervention when he said everything was fine and nothing needed to change, because he has got a contradiction going on here. This is that on the one hand he is telling Newshub today that the Auckland housing situation is out of control but on the other he is saying that nothing needs to change. This is what needs to change: new Part 3 of the bill.

Throughout this debate, whenever we have managed to pry a National member or Minister off their seat to get up and talk to us, they have told us that although they understand all these problems they do not need to do anything different. Well, it is indeed the definition of madness to keep doing the same thing and expect the outcomes to change, and that is the problem with this bill. We have just had a sigh from the Minister in the chair and I do feel sorry for her, having to sit there now, because Nick Smith’s housing policy is so chaotic, so out of control that the Government had to bring a bill here to correct various mistakes he has made and open up the opportunity to actually have a debate about things that will make a difference to the supply and affordability of housing. New Part 3 does that. The Minister who was in the chair, Nick Smith, came down to this Chamber and tried to deny the reason for this. It is plain to all of us on this side of the Chamber that new Part 3 fulfils that.

I want to now go through new section 50U(2) to talk about the elements of what this kind of affordable housing development would look like. In particular, I want to talk about the notion of the importance of houses being sold to first-home buyers and not used for speculation, because that is the big difference between new Part 3 and Part 1 of this bill. Part 1 of this bill is the National Government’s view on how one does this, which is that you simply create these special housing areas and hope—hope for the best, hope that some form of affordable housing might actually be delivered in there. You do not do anything to make that happen. You do not show any leadership. You do not recognise that there is market failure. You just hope and have faith in the great, grand housing market to deliver affordable housing. It is not working, it is not happening, and that is why new Part 3 is necessary.

Hon GERRY BROWNLEE (Leader of the House): In the spirit of generosity, I seek leave for there to be question time at 2 p.m. today, notwithstanding urgency, and for there to be a third reading of the Housing Legislation Amendment Bill to be taken from 4 p.m. today, and at its conclusion the House resume with Government orders of the day.

The CHAIRPERSON (Hon Trevor Mallard): Is there any objection to that suggestion? There is objection. [Interruption] The Committee does not agree.

CHRIS HIPKINS (Labour—Rimutaka): I am not surprised that Government members want to cut this debate short, but I thank them for this opportunity to bring forward the Labour Party’s comprehensive plan to deal with the housing crisis. Although they may not have any ideas for how to deal with the significant issues facing New Zealand, we do and we welcome this opportunity to debate them. I particularly welcome this opportunity to debate Phil Twyford’s amendments.

The CHAIRPERSON (Hon Trevor Mallard): I am just going to interrupt the member because we are coming up to 1 o’clock and I do want to indicate that I was convinced by the Leader of the House to do something that was improper. I want to apologise to the Committee. I should not have put that leave, because it is leave that could have been taken only in the House and not in the Committee. The time now is to have some kai. I will resume the Committee at 2 o’clock.

Sitting suspended from 1 p.m. to 2 p.m.

CHRIS HIPKINS: I was barely getting started when I was so impertinently interrupted by the lunchtime break. I want to commend, and congratulate, my colleague Phil Twyford for the excellent amendment that he has put forward that provides a concrete solution to some of the housing challenges that New Zealand faces.

The amendment that Phil Twyford has put forward is the first part in what will be a comprehensive plan by the Labour Party to deal with the housing crisis in a way that the Government has failed to do, and we thank it for at least giving us this blank canvas, this opportunity—this opportunity—to deal with the crisis that it has created and does not have any solutions to fix it.

So, moving to this particular amendment that my colleague Phil Twyford has put forward, which requires the housing Minister, with the Housing New Zealand Corporation, to develop a plan for the delivery of 10,000 affordable houses per year for first-home buyers, I want to speak first of all to a minor amendment that I have added to that, which would insert the word “new” after “10,000” in new section 50T proposed in new clause 12. That is very important because we have several thousand State houses already and what I would be concerned about is if the Government was to use this to, basically, justify the hocking off of the existing State housing stock and say that it was increasing the supply of affordable houses by selling off State houses.

By adding the word “new” into this, we are making it very clear that this is not about tinkering around the edges or reshuffling the cards, as this Government only seems able to do; it is actually about dealing with the fundamental issue, which is that there are not enough affordable houses and we need more of them. My colleague Megan Woods will shortly be speaking to another amendment that adds a particular time frame that is required for this to happen, and I think that is a very important clarification to this also.

I want to move further forward and look at the provisions in proposed new section 50U, which are the clauses that deal with what this affordable housing development should include. It says: “In implementing the affordable housing development the Corporation must: (a) Ensure that the houses completed are affordable;”. That is really important because if we reference back to the debate we had earlier about the special housing areas, we learnt during that debate that only 10 percent of 75 percent of them are actually going to be affordable houses—so that is around 5,000 affordable houses out of the total of houses that are being developed. It simply is not enough. Let us be clear: the 10,000 that this proposal suggests also is not enough, but it is a start, and it is a heck of a lot better than the Government has been proposing or willing to do anything about.

Between the last census in 2006 and the one in 2013, the population of Auckland alone grew by 110,000, and the Government is saying that it thinks 5,000 affordable houses is enough. It simply is not. There is an entire generation of Aucklanders, in particular—but New Zealanders, as a whole—who are being shut out of the housing market because of a shortage of housing supply. I listened to the mayoral debate on Radio New Zealand National this morning as I was driving to work—[Bell rung] Mr Chair.

The CHAIRPERSON (Lindsay Tisch): Sorry, you had 1 more minute.

CHRIS HIPKINS: I did have 1 more minute, yes—thank you. I listened to the debate on the radio this morning—

The CHAIRPERSON (Lindsay Tisch): Just checking, just checking!

CHRIS HIPKINS: I listened to the debate on the radio this morning, and even Vic Crone, the National Party - supported candidate for the mayoralty of Auckland, was saying that it is a crisis and that there are not enough affordable houses, and yet the National Government is not willing to step in and actually, finally, do something about it.

This proposal put forward by my colleague Phil Twyford—a concrete proposal—to do something about the housing crisis is an opportunity. I hope the Government will embrace it, because it has basically been saying that the Opposition is all talk and that we have not got any real plans. Well, here they are and there are a lot more of them to come. I look forward to the Government’s support, because if it is actually serious about dealing with housing affordability, it will support this amendment, and it will make the commitment to build 10,000 affordable homes every year. That is the minimum that we are going to need if we are going to provide the entire generation who have been locked out of the housing market the chance to get on the housing ladder.

ALFRED NGARO (National): I rise to take a call on new Part 3. This morning we heard wailing and the gnashing of teeth. In fact, Annette King got up and she pleaded: “Where is the regulatory impact statement for Part 2 of the bill?”. She said that the democratic process means there should be a regulatory impact statement. We now are on new Part 3 and I do not see any regulatory impact statement for new Part 3, but that is OK. That is OK. Help is on its way. I have actually started to write a regulatory impact statement myself just to support and help the member over here. I realise that this was scribbled up at last minute, and put together to try to prolong this process as well. Here is the thing on this regulatory impact statement that I have managed to put together, which, I think, could be of use to new Part 3—the proposition that is here.

I have to give a historical analysis of this as part of a regulatory impact statement, and this goes back to 2014. For those who can remember, the election manifesto talked about housing, and what did it talk about? Well, the first thing it talked about was the KiwiBuild scheme. It talked about 100,000 houses. It talked about over 10 years that it would take to build that. It talked about approximately $2 billion. But then we heard the Hon David Parker, and what did he say? He said that actually that was not achievable. He said: “In fact, we wouldn’t do 10,000. We would do 4,000. In fact, in the second year we’d do less than that—possibly 2,000.” My regulatory impact statement says that there is a risk here. There is a risk in this new Part 3 if it was to take place.

The second thing that I think is really important in this regulatory impact statement is that coupled with the KiwiBuild scheme was the capital gains tax. Those who can remember—

Hon Member: Ah!

ALFRED NGARO: That is right—those members went out and said that that was important. We hear the words about speculation and speculators, but my regulatory impact statement says this: that coupled with that, if they included in the 2014 manifesto the importance around the capital gains tax—we know that that was not popular. In fact, it was so unpopular that Labour had the worst election result that it has had in a series of years. So what has it done? It has taken that out. It has taken that away. It has minimised the risk to the KiwiBuild scheme. [Interruption] That is right. There is the silence of the lambs at the moment on the other side because they know this is true. They know that this is true. My regulatory impact statement is actually stating that we cannot afford that and, in fact, that will not be good enough as it is.

As we can see in here, the report says 10,000 affordable houses, but in the regulatory impact statement that I have now there is another risk that has emerged. Although there is a prenuptial agreement between Labour and the Greens, New Zealand First is now jumping in. Denis O’Rourke, this morning, said: “It’s not good enough to build 10,000 houses per year. We are going to build 20,000 houses.” That is how ridiculous it is, because now Denis wants to join in. He wants to have a prenuptial to join into this three-way partnership to say we could just build houses. The Minister himself said this: “You can’t just throw out figures and think that that will resolve the issue around the housing affordability, around more housing. You have to have a comprehensive plan.”

Do not worry, help is on its way. I need to reiterate that in my regulatory impact report there is significant development that is happening at the moment. For instance, apparently under this term of Government, 85,000 new homes will be built. That is right. Not 100,000 in 10 years, no—85,000 new homes, and 40 homes per day in Auckland alone. We know that in 2008, when this Government came into play, it was around 10 homes per day, in a working day, up in Auckland. It is now at 40. There were 2,000 homes built on Crown land, and the significance of that is quite important.

Although we are talking about Part 3, we are talking about 10,000 homes. My regulatory impact report says that actually there is help on its way. In fact, it is here already and it coming through a National-led Government. Fifteen thousand people have now experienced—that means they have been able to take the HomeStart package where what they get has been increased to $20,000, to ensure that they can actually have a deposit on a house as well. Two thousand homes have been redeveloped on Housing New Zealand land.

There are 42,000 apprenticeships, because we know that it is not just about, as new Part 3 says, having a figure to build homes. You need to, first of all, look at the construction. You need to look at land supply, and that is particularly what this bill is looking at: land supply. In ensuring that we rezone the land, we ensure that we fast track the consenting process. To ensure that is really important. I have real concerns about new Part 3 and its achievability to meet its goal.

We think that we are making a difference. The last thing I want to say is that in the construction industry, we see another 40,000 that have been added—this is making a difference. This is the Kiwi Dream, not for the future, not for 2017—this is the “KiwiBuild” scheme that is happening right now, here in New Zealand. We know it is making a difference.

METIRIA TUREI (Co-Leader—Green): I really welcome this opportunity to continue the debate on housing in New Zealand, and to talk with other members across the Chamber about the wide range of solutions that we have to resolve the housing crisis. I must thank Nick Smith and Gerry Brownlee for giving us this opportunity to do so—for the entire rest of the day, as I understand it. Well done, them. Let us give them a clap. Good work, National. We really did need to have this housing debate, and we appreciate the opportunity.

The Green Party will be supporting new Part 3, which has been proposed by Phil Twyford, and we also welcome the opportunity to speak about the issues raised in that part. It not only provides a target, which is critical, for the number of homes that need to be built, and for which Government will then be responsible for delivering in some form—there are many different ways for Government to deliver that housing, most of which involve relationships with the private sector, with the community sector, and with iwi Māori in delivering those homes. That is a very healthy approach to housing provision in New Zealand, an approach where the Government takes fundamental responsibility for making sure that citizens—every citizen, every resident of this country—have access to warm, dry, safe, and affordable homes, and then works with the entire New Zealand community to deliver those homes to a target. So we are very pleased to see the 10,000 homes target in this part, and we look forward to supporting it.

Not only do we need a target but we do need to make sure that those homes meet a range of criteria to make sure that they work for the communities and the people who are going to be living in them, and that they are affordable. And by affordable, of course—there is a range of views about what affordable means. But at least if we say in the legislation that those homes must be affordable, we leave ourselves open to the opportunity to work through what that looks like and what that might mean—I have a view—and then to make sure that those homes are built to that target, too. I think that is a very wise provision. The requirement in this part for the homes to be warm and dry and meet safety standards is, I think, absolutely critical.

I would refer the Committee to a current campaign that is being run by SafeKids Aotearoa. That is a child health - focused public organisation, and it does policy work and community engagement on accidental child injuries. It has some terrible numbers about the kinds of injuries that children suffer every day as a result of living in homes that are not safe for them to be living in. So it is now engaged in this fantastic campaign around the country to work, primarily with those in rental homes—landlords and tenants—to find ways to help support and promote safe housing for children. As we know, the majority of New Zealand children live in rental accommodation. Certainly, the majority of children who live in poverty live in rental accommodation, so it is really important for those children who have other pressures on their health and well-being that at least the home that they live in is warm, is dry, is properly ventilated, and is properly heated but also is safe in other ways.

I would invite members and members of the public to look at the SafeKids website and to look at that campaign, and understand that the kinds of safety measures that this incredible public health organisation is promoting in order to protect the well-being of children in homes can be provided through the changes that are proposed by Phil Twyford. And why is that? That is because Phil Twyford’s amendment proposing new Part 3 of the bill does require that those new homes that are built have safety parameters built into them. It gives the Government the tools it needs to develop those standards in a much more effective way for the health and well-being of our children.

There is no doubt that New Zealanders across the country are concerned about the negative health impacts of poor-quality housing on our children. We hear about the 40,000 hospitalisations every year of children for preventable illnesses that are caused by not having a warm, dry, and safe home to live in. We know about the 150 children every week who suffer some kind of—

Dr MEGAN WOODS (Labour—Wigram): It is a pleasure to take a call on this part, because I would like to speak to my amendment to the amendment, which Chris Hipkins foreshadowed in his contribution to the Committee. Before I do that, I would like to join other colleagues in congratulating Phil Twyford on bringing amendments to the Committee that mean that we can, in this bill, debate some real issues of substance around housing. They are things that might actually add to the debate, and, like other members, I would like to thank the National Government for giving us this extended and protracted period to debate housing in this Chamber, because it is something that we welcome.

My amendment is to proposed new Part 5B—new clause 50T(2). What it does, according to subsection (2), is state: “Within six months of the completion of the plan required under subsection (1) the Minister must present a copy of the approved plan to the House of Representatives.” My amendment to that inserts, after subsection (1), “but not later than 1 March 2017”. So it is not good enough, under this amendment that Phil Twyford has brought forward, for the Minister to sit back and do what he has done for the last 8 years, which is precisely nothing to address the issues of housing affordability—so there is then an onus on the Minister to actually do something. Until we change the Government later next year, we have to have legislative requirements to get this Government to actually do something.

Mr Ngaro gave a contribution in which he told us: “Don’t worry, we’re doing it anyway.” Nobody believes that. People can look around, they can look at the gold medal that New Zealand won in terms of housing affordability just today, and see that housing affordability is at a crisis point in New Zealand. Too many New Zealanders are being shut out of the Kiwi Dream, and if Mr Ngaro thinks that the National Government is currently doing enough, then I think it is absolutely critical that we have this debate and expose the Government for the do-nothing Government that it is on the issue of housing affordability. If the people on the opposite benches think what they are doing is adequate to address the issues we have around housing affordability, it is no wonder that we are in this muddle and that we have too many New Zealanders shut out of housing affordability.

So the amendment we are putting forward would require this Government to do something. This Government, which has had 8 years in office, has been presiding over an escalating problem. So a plan would have to be produced. That would be a first, because what we are learning every time one of the few Government members do get on their feet and take a call—and I do commend the Government members who actually have got on their feet and taken a call—is that more and more the layers of the onion are being peeled back to reveal just how much this Government does not understand the problem that New Zealand is facing here.

What is revealed every time one of the Government members speaks is the lack of ability to grasp the real problem. The real problem is that there are not enough houses being built at an affordable price. It is the Labour Party that has come up with a plan to do that. We are going to put a plan in place, we are going to put a target in place, and we are going to build those houses.

That brings me, also, to another provision in this amendment that I would like to speak to, and that is new clause 50T(3), where the Minister must report to this Parliament on progress. What we have learnt from the last 8 years is that some accountabilities have to be put in place. It is not good enough for a Government to just sit back, do nothing, and then claim, as Mr Ngaro said, “Don’t worry, help is already on the way.” Well, that is absolute codswallop.

What is more, the people of New Zealand absolutely do not buy that this Government is doing anything to address the issue of housing affordability. It has taken a comprehensive plan from Labour. We will get the chance to debate over the course of today and tonight, and possibly tomorrow, what that comprehensive plan looks like. This Government needs to see up close what real action on housing looks like.

DAVID SEYMOUR (Leader—ACT): I think that sometimes in public policy debates we are, perhaps, subject to a bit of historical amnesia and perhaps we imagine a past that never really was. The great Labour narrative that came out is that, just like we are selling all the old tea towels and all the old crockery for fund-raising on the Labour website, if we could only hark back to the past, it has got to be better than Labour’s present. Almost anything would be better than Labour’s present, but, sadly, the past was not that good either, and it is important to understand one’s own history.

If the Labour Party members were to read the excellent Gael Ferguson book Building the New Zealand Dream, one of the first things they would learn is that Michael Joseph Savage, the first Labour Prime Minister, said he would not trust the Ministry of Works to build a fowl house. The interesting thing is that when the Labour Party says the Government will build houses, it never means that the Government is going to build houses; what it means is that the Government is going to contract the building of houses out to private enterprise.

Then you have to ask what the role of Government actually is. Does the Government have some magic ability to override all of the constraints on building new homes that have been currently identified as leading to a limitation on housing supply in New Zealand, high prices, and homelessness? Labour members have no such prescription in this amendment that will solve the problems of a limit of land that councils will allow anybody, including the builders contracted by the Government, to build upon. There is no solution in this amendment to solve the very real problem that infrastructure funding incentives are too weak for councils. There is nothing in this new part that will solve either of those problems, or in any of the other new parts, if we are allowed to mention those. The interesting thing is that when one starts to investigate one’s history, the facts become terribly clear, and from the Labour Party’s point of view, it is terribly depressing. This idea that there was once a golden age when the State built all the houses, in reality, never ever was.

Let us take building consents for 1961, for instance—a very good year for home building in New Zealand. There were 24,397 residential consents issued in our country in 1961, when only 2 million people lived here. That would be a little bit like issuing something like 55,000 or 60,000 consents for the current New Zealand population today. How many of those houses were built by the Government, or at least contracted by the Government to be built in 1961? Well, the number, you might be interested to know, was 2,749. How many houses does that leave? The Labour Party members are trying to do quick mental arithmetic. How many houses were built by the private sector in that year, 1961? There were 21,648. Even in the heyday of Labour’s State home - building halcyon period the truth is simply that the private sector built almost 10 times more houses than the State ever could.

Why it is believed that this history that never was is going to save us, I cannot understand. But what is very clear is that there is nothing in this new part that is going to solve the real underlying problems in the housing market. The fact is that those problems were never solved. The Government never built houses; it always contracted out to Fletcher’s. Even in some of the best years of home building in New Zealand, the State was a bit player—a 10 percent player at best.

We could have anticipated the porosity of this argument from the way the Labour Party members have behaved in the last 24 hours. The first half of the debate was all about due process and rushing through complicated, far-reaching reforms under urgency without due process. Then in the second part of the debate—oh, wow, we are now going to introduce three new parts that are far more far-reaching in their implications, in the Committee stage with no public consultation whatsoever. Well, I guess that is just politics. I guess that is the Labour Party for you—rudderless and ignorant of its own history.

JACINDA ARDERN (Labour): I want to start by just referring directly to what this amendment does, because my colleague Mr Seymour seems confused. In his contribution he seemed to claim that, first, the Government cannot deliver housing, despite all the evidence, and it is the private sector that has always delivered housing. Well, we have tried that. It is not working. That is why we are here. That is the first point. The second point: this amendment is about delivering the KiwiBuild plan. If Mr Seymour knew anything about the KiwiBuild plan, he would know it is about partnering with private developers in order to deliver affordable housing, which is what most of the special housing areas that the Government has unsuccessfully delivered attempted, unsuccessfully, to do—something that Mr Seymour is voting in favour of. So what he seems to be voting against, I think, as far as I can tell, is scale. He just does not want to do that many affordable houses, or is it just simply that the Labour Party has put the idea forward, and it is petty politics? Either way, this amendment is the one thing that will actually fulfil the policy goals of this bill.

If you go to the general policy statement in the bill, it says: “The Bill amends 2 Acts that relate to increasing the supply and affordability of housing.” It does not really do either. If you go over to the second page, it says: “The purpose of the Bill is to support the wider Government programme of work to increase the supply and affordability of housing, and to maintain the momentum of strong growth in new home construction.” The only place where there is momentum is in house prices. That is the only place where we have momentum, if you are asking not just in Auckland but anywhere in the country. We are not delivering houses at the pace we need.

This amendment fulfils the general policy statement of this bill. Without this amendment, this bill really is hollow. Just because you say it, it does not make it true. This bill does not have the substantive amendments required.

Coming to some separate clauses, I want to start with—because there has not been much discussion about it—proposed clause 50U, “Corporation”—as in Housing New Zealand—“to manage affordable housing development”. This is the way that we are delivering the KiwiBuild plan. But I think what is really important here is that we are putting parameters around what the corporation has to deliver, because, unlike the special housing areas, there has not been necessarily the impetus to ensure that we are increasing stock.

Let me give you an example: Spring Street in central Auckland was designated a special housing area. It is a group of pensioner houses—one-bedroom units—of roughly 40 units, all currently held by Housing New Zealand. It decided that this was prime real estate where you could build more housing. So there was a tender process where Housing New Zealand decided that it would sell the land to a private developer, but that private developer would only be required to then lease back to Housing New Zealand—how many units?

Louisa Wall: How many?

JACINDA ARDERN: Forty—the same amount we already had. What an absolutely ridiculous proposition. We would put ourselves in the position of selling prime real estate—and we know that, because of the way Housing New Zealand operates, it will be under market value—to a developer to develop. It could put on however many private dwellings that it chooses to make a quick buck, none of which are required to be affordable, and then lease back at top dollar to Housing New Zealand the same number of units it already had. That is pure stupidity—pure stupidity.

So it makes absolute sense that we have proposed clause 50U here in this amendment, which not only ensures that the houses that are completed are affordable but also we are ensuring that they are not used for speculators and that we are making sure first-home buyers have access to those units.

The other thing that is important and I want to note in this amendment is, of course, that we are focusing on speed and affordability. The average house that is currently being built in Auckland is 200 square metres. By default, it is not affordable. So having someone who goes into the market with the express purpose of building houses that are smaller—smaller, yes, but the average house built in the UK now is 90 square metres—is what we need, and it is not what the market is providing, Mr Seymour. We let the market try. It failed. We have the worst rate of homeownership in 50 years. This amendment, Mr Seymour, is about turning that around and actually doing what the bill claims it is trying to do.

JAN LOGIE (Green): I would like to just start my contribution on new Part 3 by referencing some of the comments I heard made this week in the homelessness inquiry, because it is quite relevant this part of the bill. I will start with the comment from Shamubeel Eaqub talking about how “homeownership died in 1991, and renting sucks. The housing market is fundamentally broken, and Housing New Zealand has not built enough homes.” I think that pretty much sums up the drive for this new part. It is actually taking some sound economic advice and using that as an input to drive good public policy-making.

I would also like to just go back to the context of this new part of the bill sitting within this piece of legislation and reference back to the first piece of special housing accord legislation, which also went through under urgency 3 years ago. We were told that this whole model that the Government is providing us is to bring about affordable housing and increase the number of houses that were being built. What we heard at that time was that it was necessary to be done under urgency because it showed the Government cared and that it needed to happen because if you looked at Auckland at that time, in 2013, the average house price was about $735,000 and, God forbid, there was an expectation or a possibility that the average house price might rise to $1 million within 3 to 4 years. So that legislation was needed under urgency to prevent that possibility. Well, how ironic is it that on the same day that house prices in Auckland exceeded $1 million, the Government is coming back with the same legislation to extend that same provision that has so comprehensively failed.

I am very pleased to be supporting new Part 3 of this bill, which actually has some hope of succeeding—some hope of actually delivering New Zealanders affordable housing and getting those houses built. As Shamubeel Eaqub was saying, Housing New Zealand has not built enough homes, so, actually, we know what part of the solution is, and it is for Housing New Zealand to build more homes.

Mr Seymour can quibble over the details of who is going to be there with the hammer. Actually, nobody has ever thought that we were going to be sending Nick Smith out with a hammer. That is not what Mr Twyford is suggesting with this amendment, though, actually, it would be more constructive than what Nick Smith is doing here. This amendment is actually taking responsibility, and I do think this conversation is really important. If I am honest—and I am not speaking for anyone else in my party when the arguments are coming up about how we have complained that there is not enough information for us to make our decisions on the previous parts, yet we are presenting this without people having the possibility of consulting—I personally do not have faith that the Government is going to allow this to pass. But I am absolutely committed to reflecting the views we heard from the homelessness inquiry and giving New Zealand the chance to consider the alternative, and to consider that, actually, yes, this could be possible. We could have some responsible public policy intervention in housing.

I do want to speak to another aspect of this new part, briefly, around the ability for these homes to be safe and warm and dry. That is also one of the problems we have with the free-market approach that the Government is using with the State housing accord, as opposed to this more direct model where, actually, we can ensure that all of those houses are warm and dry as well as affordable, improving people’s health, improving their quality of life, and providing returns to the Government in terms of educational improvements, better work productivity, savings to the health budget, all round—

DAVID SEYMOUR (Leader—ACT): I raise a point of order, Mr Chairperson. To help inform the Committee in the debate, I seek leave to table figures I referred to in my earlier contribution, building permits residential building consents from—

The CHAIRPERSON (Lindsay Tisch): No. My question is: is this in the public domain? Where are these figures from?

DAVID SEYMOUR: It was assembled by the Parliamentary Library for my office on 13 July this year.

The CHAIRPERSON (Lindsay Tisch): From the Parliamentary Library—specifically for you?

DAVID SEYMOUR: Yes.

The CHAIRPERSON (Lindsay Tisch): Oh well, I will put the leave; the Committee can decide. Leave is sought for that purpose, to table that document. Is there any objection? There is objection.

ANDREW LITTLE (Leader of the Opposition): I am pleased that the member for Epsom took the opportunity to refer once again to his data, because earlier in a contribution on this debate I championed the life of some of the founders of his party. It is not a very old party. Like him, it has not been around that long. They were people of great principle, great integrity. They knew the history of this great country of ours in a way that, sadly, that member does not. You see, the thing about this is that when you want to refer to historical matters of this great country of ours, you actually have to get all your history right, not just the bits that suit your argument.

So the thing is this. In Labour’s great house-building programme of the 1930s, led by the great tōtara of the Labour Party at that time—the Michael Joseph Savages, the Peter Frasers, the Dan Sullivans, the various others—they did not rely on the Ministry of Works to build the houses. They relied on a whole host of contractors and others, including Fletcher’s. The great empire that is Fletcher Building today—or whatever it calls itself—actually has as its origins, from that very time, a progressive Labour Government with a progressive founding director of that great company that actually built the houses. And they did some pretty incredible things. I recently had the privilege of visiting Savage Crescent in Palmerston North, which was one of those progressive housing developments designed and developed at that very time—because it was not just about housing, it was about community as well.

Here is the interesting thing: Mr Seymour referred to the building consent figures from 1961, as if they somehow magically happened themselves, without any impetus at all. What he forgets, of course, is that was not long after the, sadly, short-lived but powerful and very good Nash-led Labour Government, which introduced the 3 percent housing loans. That was the impetus for that house-building programme. That was why there was a spike in house building, because that Labour Government knew at that time that more houses were needed and it knew that the Government had a role to play in making sure that happened. And that was the way that it happened.

Sadly, we have now an ACT Party representative who does not respect the fullness and the greatness of this country’s history. What he does not want to admit, like many members opposite, is that the greatest moments of this country and its social and economic and political development have had at their heart the Labour Party. Oh, yes, at every turn—at every turn—the Labour Party has led progress and development, for the benefit of all citizens. That is why the new Part 3 amendment introduced by the Labour Party is so important. It is just one element of the genuinely comprehensive package for housing to meet the needs of the present housing crisis, which is now a matter of urgency. But good on the Government and the present Minister for realising that something has to be done, although he cannot bring himself to say that there is a crisis.

We can all see that the special housing areas, no matter how kind of muted the ultimate impact—OK, good idea. Let us extend them. That is why we support that. We do not support Part 2, but this has allowed us, the Labour Party, the opportunity to now put before this House the genuinely comprehensive housing package that we have got. New Part 3 allows us to talk about our programme, the KiwiBuild programme, which is about 10,000 houses a year. All new Part 3 does is require the Minister to not only take up the proposal but to report in an effective and timely manner on it.

We can do this. The Government can actually do this stuff. It requires political will. If the Government of the day does not do it, then let all members of this House who have been part of this debate provide that impetus to let the Government see the light and get on and do the job that New Zealanders are demanding that it does. Far too many New Zealanders now see no hope and no future and no prospect of owning their own home. We have to do better. If the Government, after 8 years, cannot do better, then let us do it—let us do it.

So I am thankful for the opportunity that the Government has given us to lay out our plan, but it is now—as this motion for this whole legislation tells us—urgent, and if the Government knew what it was doing it would urgently adopt our plan.

POTO WILLIAMS (Labour—Christchurch East): I want to concentrate my contribution on new clause 50U(1), which looks at the Housing New Zealand Corporation being responsible for managing the development of affordable housing under the plan. I have been the beneficiary of the way that Housing New Zealand Corporation used to be under a Labour Government. What I mean by that is that in those days Housing New Zealand had at its heart the desire to not only house people but help people and communities develop communities. The way that it did that was it included within its mandate the ability to have community housing, which allowed community organisations to benefit from the housing programme put in place by the Government and to have access to housing for community groups. What this amendment in this particular clause does is that it requires the corporation to once again become the heart of community development, as it once was. Not only will this look at providing affordable housing; it will also look at providing appropriate housing.

During the homelessness inquiry that has been around the country, one of the overriding concerns that has come out of this is that the housing we are currently building is four-bedroom, executive homes, when what we actually need are one- and two-bedroom homes. We need modest housing. We need housing that will help us to house the elderly and to house people who are single and single-parent families. We have this overburden of these large houses. We have a surplus, almost, of bedrooms, when what we actually need is much more appropriate housing of a kind that will suit the needs of our communities.

What this Government has done over the last 8 years is to not only scale-back that involvement of communities, of them being to participate with Housing New Zealand to develop in consultation and cooperation the types of housing that they need for their communities, but actually do something a lot more sinister: it has actually taken the community out of its programme. When we look at the removal of the four well-beings out of the requirements for local government, it really speaks to the heart of what sits in this bill and why we oppose this bill and why we are supporting Part 3. We need to put communities back into our housing plans.

I want to use the example of what happened in my own community, in Aranui, where at one stage Housing New Zealand was proposing some redevelopment of homes. The community got engaged in that discussion and helped it to design homes that were fit for purpose—one- and two-bedroom homes, single access and with garages, which were really useful for elderly people. In the latest iteration of developments by Housing New Zealand into that same community, when the community asked for consultation to be part of the process, it was denied the ability to effect any change to the plans that Housing New Zealand was making in that community. What that has resulted in is an intensive development that has gone into the Aranui community of two-storey homes, with several homes on what were the properties of one or two, which have now become developments of four, five, or six, and there are single accesses into these large groups of homes. They are a complete anathema to the way that this community wanted those homes to be, because there was a lack of consultation.

All through this discussion, all through this debate, there has been this thought that consultation should sit at the heart of when we are making such significant changes. That is no different to, when we are looking at new Part 3, how we want our communities to develop. There is no doubt that good housing, affordable housing, and appropriate housing is actually the way we develop our strong communities. I would urge the Government to support this, because this is the way we are going to build our strong communities, where people know that they are able to stay in the same house night after night, and where they have security of tenure.

DENIS O’ROURKE (NZ First): I want to talk about two things in relation to this new part of the bill: first of all, supply, and, secondly, affordability, because those are, in fact, the crucial issues. First of all, supply. That means, actually, the rate of new house building. Labour and the Greens say 10,000 houses per annum; the Government, per Alfred Ngaro, seems to be saying 14,600 per annum, because he talked about 40 houses a day, and if you multiply that by 365 days you get 14,300. In fact, the Government is getting nowhere near that rate of building. Nevertheless, that is what he claimed, for some reason. But neither of these are actually enough.

If you look at the Auckland Unitary Plan, and other indicators, actually, the real need in Auckland over the next 7 years is a minimum of 130,000 houses if immigration is going to continue at a net gain of 70,000 people a year—70,000 people a year. If that were curbed, then maybe that need could be reduced. But the fact is that with that magnitude of net immigration the need in Auckland alone, over 7 years, is 130,000 houses. That is why New Zealand First has, for the last year or more, had in its housing policy a target of 140,000 over the next 7 years. We took notice of all those indicators and we put in our policy 140,000 houses over 7 years, which is 20,000 a year. That is not just political one-upmanship; it is actually based on research and actual need as indicated by independent parties. It is not an invention by New Zealand First. It is what the actual need is if immigration is going to continue at the current rate.

Yet, if you were to believe Alfred Ngaro, the Government wants to build 14,600 a year, which is actually 102,600 houses over 7 years. Yet his own Minister, the “Minister of Homelessness”, said that that was unaffordable, unachievable. He said that all of the parties on this side of the House had unachievable targets, and yet Alfred Ngaro actually says it should be even more than that. So this Government is in total disarray. It does not actually have a target in its so-called comprehensive housing plan. We do not really know what it is trying to do. All we know is that it is doing some haphazard things and what it has amounted to is, as I have said in the past, a litany of failed policies and no comprehensive housing plan whatsoever. In fact, all it has been doing with the special housing areas is to build a pathetically small number of houses—1,300 over the last 3 years—which is nowhere near the need.

The point, however, is that whatever the target is, there is a genuine need out there, and it is not ever going to be met through Resource Management Act reform. It is not ever going to be met through special housing areas and accords with local government while the reliance on building the houses themselves is left totally in the hands of private developers. Megan Woods, in her speech, said it is the Labour Party that has the plan. Well, actually, it is not just the Labour Party. New Zealand First, for the last 3 or more years, has had that sort of plan for Government intervention in the market to actually build houses, to develop and build houses—appropriate houses, affordable houses, modest houses that people can afford as their first home—and to sell them on terms that people can actually afford. We have always said that. We have always known that direct investment by the Government is the only way that this housing crisis can be solved. The private market alone will never do it—it will never do it—and that is what this Government does not seem to understand.

I want to move on to affordability, because that—

JONO NAYLOR (National): I move, That the question be now put.

The CHAIRPERSON (Lindsay Tisch): I am going to take the mover of the amendment—Phil Twyford.

PHIL TWYFORD (Labour—Te Atatū): I am proud to be the mover—and the shaker. It is appropriate that we are debating this issue in this housing bill this afternoon, because the role of the Government in fixing a broken housing market is one of the fault lines that runs through this House. It divides the left and the right. It divides the people who have a kind of childlike, touching faith in the ability of the market to fix itself from those people like us, who, informed by history and experience, have a confidence that the powers of Government can be used to do good in our community and that it is the job of the Government to actually make markets work for everybody. That is the idea that lies at the heart of our KiwiBuild policy and this proposed new Part 3 of the Housing Legislation Amendment Bill.

These days the Government is very fond of talking up what it calls a massive building boom in Auckland. Well, just how massive is that building boom? Currently, in Auckland, 9,651 homes have been consented in the last 12 months. That means that about 8,500 homes have been built. In 2004, 12,937 homes were consented, so we are way below—25 percent below—the peak of 2004. If you factor in population growth, currently, under John Key, we are consenting about six homes per 1,000 population at the moment—six homes per 1,000 per year. Under Norman Kirk’s prime ministership in the mid-1970s, New Zealand was building 16 homes—16 homes—per 1,000 population per year. So this is far from being a building boom.

I want to talk about why using Government procurement—using the power of the State to stimulate the construction of new homes—is a good idea in the current market. Our construction industry has been gutted of skilled labour by the boom-and-bust cycle, which goes up and down like a roller coaster. Every time the market goes down, we lose half our skilled tradespeople. They leave the industry, and often leave the country. A Government procurement programme like KiwiBuild, as embodied in new Part 3, would maintain the supply of new residential builds at the equivalent of the top of the market and keep it there in a countercyclical way for a decade, giving local New Zealand construction firms and all of the industry trades that support them the certainty and the volume to increase their production, to take on more staff, and to train the 5,000 apprentices that we estimate would be needed to build the labour force to implement this policy.

It would allow using companies like Mike Greer Homes. Mike Greer has pioneered state of the art off-site manufacturing at his Concision factory in Rolleston in Canterbury, and is using the latest high-precision, digital, German equipment to build high-quality homes at a much more achievable cost. These are the kinds of benefits of building up the workforce and employing new design and production technology to build better houses at a more affordable cost. It will also allow us to bust through the rorts and the anti-competitive practices that plague the building supplies market.

I could walk into a Home Depot in California and buy treated Pinus radiata framing timber for residential construction at a quarter of the price that I would pay if I go to a Bunnings Warehouse or a Mitre 10. Our building supplies market is seriously anti-competitive. It is uncompetitive. Kiwis are paying nearly 30 percent more than Australians for exactly the same building materials. Through this policy—building 10,000 homes a year using Government procurements to that—we can cut through those supply chain blockages and drive down the cost of building. This is how Labour will restore affordable homeownership to a new generation of New Zealanders.

MAUREEN PUGH (National): I move, That the question be now put.

A party vote was called for on the question, That the question be now put.

Ayes 63

New Zealand National 59; Māori Party 2; ACT New Zealand 1; United Future 1.

Noes 58

New Zealand Labour 32; Green Party 14; New Zealand First 12.

Motion agreed to.

The question was put that the following amendment in the name of Chris Hipkins to the proposed amendment in the name of Phil Twyford to add new Part 3 be agreed to:

insert in new section 50T(1) in clause 12 “new” after “10,000”.

A party vote was called for on the question, That the amendment to the amendment be agreed to.

Ayes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Noes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Dr Megan Woods to the proposed amendment in the name of Phil Twyford to add new Part 3 be agreed to:

in new clause 12, new Part 5B, new section 50T(1), insert in after “buyers” “but not later than 1 March 2017”.

A party vote was called for on the question, That the amendment to the amendment be agreed to.

Ayes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Noes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Phil Twyford be agreed to:

to add the following new part:

Part 3

Amendment to Housing Corporation Act 1974

11 Principal Act

This Part amends the Housing Corporation Act 1974.

12 New Part 5B

After section 50S insert:

Part 5B

Affordable Housing Development

50T Minister of Housing must ensure affordable housing built

(1) The Minister of Housing must prepare a plan in consultation with the Corporation for the delivery of 10,000 affordable houses per year for first home buyers.

(2) Within six months of the completion of the plan required under subsection (1) the Minister must present a copy of the approved plan to the House of Representatives.

(3) The Minister of Housing must ensure that all targets set out within the plan are met and report to the House of Representatives annually on its progress.

50U Corporation to manage affordable housing development

(1) The Corporation will be responsible for managing the development of affordable housing under the plan under section 50T(1).

(2) In implementing the affordable housing development the Corporation must:

(a) Ensure that the houses completed are affordable;

(b) Ensure that the houses are sold to first home buyers and are not used for speculation;

(c) Ensure all houses built meet all legal standards required and are warm, dry, and safe; and

(d) Work with private sector builders to ensure houses are built to a high quality using the latest construction methods.

A party vote was called for on the question, That the amendment be agreed to.

Ayes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Noes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Amendment not agreed to.

New Part 4 Amendments to Income Tax Act 2007

PHIL TWYFORD (Labour—Te Atatū): I am very glad to take a call on new Part 4 of the Housing Legislation Amendment Bill—yet another great housing policy that we are having the opportunity to debate this afternoon in our Committee. I must say how refreshing it is to finally have some good housing policy to debate. For those of you who take an interest in #ChangeTheGovt, this afternoon in the House is a little opportunity to get a feel for what it is going to be like after the election next year, because we are going to be in the House here, discussing meaningful, transformational housing policy, like building 100,000 affordable homes for first home buyers and like taxing speculators.

New Part 4 of this bill basically pushes out what has come to be known as the brightline test from 2 years to 5 years. Let me explain to folks what that means: in September last year, in one of its many rushes of blood to the head about the housing crisis, the National Government, presumably prompted by David Farrar’s overnight polling, decided that it had better make some kind of announcement on housing in order to try to placate an electorate that was increasingly worried about the effects of the housing crisis. What it announced was a 2-year brightline, so that if a property investor sold a rental property within 2 years of buying it, then they would pay income tax on the capital gain.

Ostensibly, this was the Government acknowledging, even though it had been denying it for the last 2 years, that speculators were a problem in the market. Minister Nick Smith does not even like to use the term “speculator”. He does not agree with the use of that term. This policy flip-flop by National, implementing a 2-year brightline test, was, effectively, an acknowledgment that speculation is a problem in the housing market.

We subsequently found out from Government papers released under the Official Information Act, that Treasury had done the modelling for the brightline test and estimated that the 2-year brightline would be likely to have an impact on a maximum of 1,000 of the nearly 80,000 house sales each year, that it would raise just $18 million, and that it would affect less than 2 percent of all house sales. So Treasury basically said a 2-year test on taxation requiring income tax to be paid on the capital gain from the sale of a rental property within 2 years of its purchase—Treasury and a host of other Government advisers basically said it would have virtually no impact.

Did that stop the Government from announcing it? I do not think so, because it saw a headline. It saw a press release and a headline, and if we have learnt anything from Nick Smith’s long parliamentary career, he starts with the press release and then works his way back through the policy development process, in reverse, right back to trying to find the evidence to justify the policy to support the press release. He is a master practitioner in the art of—

Hon Members: Policy-based evidence.

PHIL TWYFORD: —policy-based evidence-making—thank you very much, colleagues.

I think it is plain for anybody to see that under this National Government, property speculators have been allowed to run riot. Property speculators are rampant, particularly in the Auckland market, and we see from the latest CoreLogic data that speculators account for 46 percent, on average, of all property transactions. Nearly half of all homes purchased at the moment in the Auckland housing market are being snapped up by speculators, and if anyone here reads the New Zealand Herald newspaper, they will know that people are making a killing—an absolute killing—buying and selling properties, sometimes within even days or weeks of the original purchase, making hundreds of thousands of dollars in the process. It is so out of control that it is clear that many of these speculators are, in fact, paying income tax on it, but the housing market, as Nick Smith said today, is so out of control, that the massive capital gains that people are making are such that they are not deterred by the prospect—[Bell rung]

Grant Robertson: I raise a point of order, Mr Chairperson. Under Speaker’s ruling 87/5 it says that the Minister who is responsible for the bill has to be in the chair or leave the Chamber. The Minister responsible for this bill is in the Chamber, but not in the chair. Either of those two options works for me, Mr Chair.

The CHAIRPERSON (Hon Chester Borrows): Oh, that is very good of you, to make that concession.

Hon Judith Collins: Do you want to be in the chair, Minister Smith? Fabulous. Thank you so much, very good. That’s so nice—the nicest thing you’ve ever done for me, Grant.

The CHAIRPERSON (Hon Chester Borrows): Are flowers going to follow now, or something, are they? I call Phil Twyford.

PHIL TWYFORD: Very good decision, Mr Chairman. One of the reasons that property speculation is bad—and I mentioned in my first 5 minutes that property speculators currently account for 46 percent of all transactions in the Auckland market at the moment—is that property speculators are going around the suburbs of Auckland and basically hoovering up affordable homes.

If you look at the data for a suburb in South Auckland like Ōtara, which has always had very affordable housing—it is one of the places in Auckland where young families can go and housing has been affordable. It is where people go to get a start in life. In Ōtara speculators account for, not 46 percent of all property transactions, which is the average across Auckland, but they are snapping up 80 percent—eight-zero—of all property transactions. So it should not surprise us that homeownership rates are falling in Ōtara four times faster than the national average. As the speculators go in and hoover up all these houses, homeownership rates are plummeting. Homeownership rates are falling over most of Auckland, except in the very leafy, wealthy suburbs. So in a place like Herne Bay, the beautiful suburb of Herne Bay, homeownership rates are actually going up, but across much of Auckland, including west Auckland, where I am from, homeownership rates are falling, and entire streets now are owned by property investors, many of whom are offshore absentee landlords.

So this new Part 4—basically, what it does is it pushes out the brightline test from 2 years to 5 years. I want to explain, for people who have not followed this debate, what the brightline test is. Under New Zealand tax law, you normally would be expected to pay income tax if you were deemed to have purchased this rental property for investment purposes—with the intention of making a profit on the future sale of that property. It is a very subjective test about intention. What the brightline test does is it says: “No ifs, no buts. If you sell it within this period”—2 years in the case of the current law, and 5 years in the case of our amendment—“you pay income tax, regardless of your intention.” So it overrides the intention test, and it, effectively, puts in place a capital gains test for residential property speculation. We think that is a good thing to do, because it is very important that we start to squeeze property speculation out of the housing market.

There are massive capital gains that people are making—entrenched expectations of capital gains—which has a self-fulfilling effect. It drives more and more people into the market who think that in John Key’s New Zealand the only way you can get ahead, the only way you can make a dollar, is by speculating in real estate. We have to stop that, not only for the good of our children and our grandchildren, so that future generations can have some prospect of owning their own homes in this country, but also because it is enormously damaging to our economy to have real estate speculation sucking vast amounts of capital into what is an unproductive business activity that generates no jobs and no exports.

Let me give you this statistic. In the last 12 months, banks in this country lent $5 billion to the manufacturing industry—$5 billion to the manufacturing industry. In the same period they lent $25 billion to property investors. I think that gives you a snapshot of the state of our economy, and the fact that there is a vast, inflated bubble in the housing market that is sucking huge amounts of productive capital into property speculation.

Labour believes that if we push the brightline test out to 5 years, that will make a significant difference. The basis of Treasury’s advice—that the 2-year brightline would not make much of a difference—was, of course, that property speculators would hold on to a property for 2 years and a day, and then flick it on. So not only would it generate virtually no revenue; it would have very little effect in changing the behaviour of property speculation. We believe that 5 years would make a significant difference, but for us this is a down payment. It is merely a down payment.

Andrew Little has signalled that Labour will move on negative gearing—that is, the ability for property investors to write off any losses they make on a rental property against other taxable activity. So if you buy a property and you are leveraged up so high that you are paying the bank more in interest than you are getting back in rent, you are making a loss on that property. Taking into account all the other outgoings like rates, and insurance, and maintenance, if you are making a loss, you can then offset that loss against other tax that you are paying, perhaps for your job or for some other business, or some other investment. That is a huge, huge public subsidy for property speculation, and we are told by the Inland Revenue Department that last year property investors snaffled up $650 million in tax breaks. The public of New Zealand gave property speculators, some of whom own six, seven, or eight properties—they pocketed $650 million. “Thank you very much, Mr Taxpayer.”

If we do not deal with the problem of property speculation, we will never ever fix this broken housing market. If we build houses, if we reform the planning rules, and if we do all those things we can get the market back in balance, hopefully that will reduce the capital gains and drive the speculators out, but, in our view, fixing the tax settings that now incentivise a speculative mania in the housing market and threaten the very financial stability of our economy and our banking system has to be a top priority, and that is what new Part 4 will do.

GRANT ROBERTSON (Labour—Wellington Central): Thank you very much for the opportunity to contribute in the debate on new Part 4 of this bill. It is worth noting that this is a critical element in terms of the overall scope of this bill, which is about how we improve the affordability of housing for New Zealanders.

I want to take people back to the origin of the 2-year brightline test, which is being extended in new Part 4 of the bill in front of us today, and it takes us back to Budget 2015. In the build-up to Budget 2015, New Zealanders’ concerns about the housing market, about the affordability of housing, were rising. It was a time when price rises that had never been seen before in Auckland were starting to get into the consciousness of New Zealanders. The Government was flat-footed, because what we came to discover was that there was actually nothing in the Budget on housing. It did not have anything in the preparation for the Budget that had taken place to deal with this emerging housing crisis, with 20 to 25 percent annual increases in the price of houses in Auckland. We know this because once all the documentation from Budget 2015 was released, there was nothing in it about the brightline test. Officials had not done any modelling.

Just reflect on that for a minute. The Government introduced, under urgency and around the time of Budget 2015, this brightline test, but it never modelled what it was actually going to do. In fact, it got to a completely farcical point, which some people might recall, with Bill English admitting on television that he had no idea whether this brightline test would have any impact at all. Eventually, some work was done—well, actually it had been done earlier, in 2010—and it was eventually released. It said that the 2-year brightline test that the Government brought in would net, at most, 1,000 of nearly 80,000 house sales and raise just $18 million per year in revenue for the Government.

The test was a weak and half-hearted measure. It came in because the Government had had its hand forced. The Government kept saying there was this thing called the intention test: if you purchased a property with the intention of selling, you would have to pay a tax on the capital gain. Of course, no one admitted that. No one said “Yes, that is my intention.”, despite the fact that thousands of homes were being flipped over quickly, for profit. So the Government, in a corner, said: “All right. We’ll do a 2-year brightline test.”

I sat on the select committee when we addressed the issues that are contained in this part and relate to the brightline test. Treasury was very clear. It said: “If a Government is going to do this, at least make it 5 years because the behavioural impacts will be much higher if you say to somebody that if you try to sell a house, an investment property, within 5 years you will be taxed on that.” The advice that we got from officials was that 2 years was not enough. Someone who was speculating in the housing market would wait out the 2 years and 1 day, and then they would flick off the property. That was the advice that we got in the committee. I do want to be absolutely clear. The existing brightline test and, indeed, what is contained in new Part 4 do not apply to the family home. They do not apply to the family home. This is only about speculators—about those who own more than one property and then move them on within the 2-year period, as it is now, and the 5-year period that we want it to be.

This is a vitally important measure around housing affordability. Speculators have a disproportionate impact on the housing market. They are pushing out first-home buyers from getting in and building up the Kiwi Dream, which we know has been so important to New Zealanders. The Government got that. It got that, to the extent that it needed to be seen to be doing something. As with all of the Government’s initiatives in housing, this is about how little it could do to get away with being seen to be doing something.

The Government rushed this out in May 2015 and said: “This is what we’re going to do.” It was an inadequate response then, at a time when the level of investor activity, particularly in the Auckland housing market, was lower than it is now. Now we know that nearly one in two purchases in the Auckland housing market are being made by investors or speculators. When the brightline test came in, it was just under 40 percent. The Government has put this in place. It has been an inadequate measure. It is a step forward, in terms of cracking down on speculators. There are more things to be done.

But this is an opportunity. I want to make clear that we are deadly serious, on this side of the Chamber, about these amendments we are putting forward. These are the policies we think are needed to get more affordable housing, and we want to have a debate about it because the Government has had its head in the sand for too long about the importance of these issues.

JACINDA ARDERN (Labour): I want to pick up where my colleague Grant Robertson left off, around new Part 4, and the amount of information that we have around what the effect of this legislative amendment would be. We are reliant on the analysis that the Government originally undertook when it implemented the 2-year brightline test. Of course, as those who are familiar with regulatory impact statements will know, usually we are given an indication of the range of options that were canvassed by the Government. Actually, to be honest, even when the Government has already got an idea of where it is going to go, it is incumbent on officials to provide a range of options, points of comparison, to understand whether or not where you have landed is going to best give effect to your goals.

I went back to the regulatory impact statement, which Grant Robertson touched on a little bit. What is phenomenal I think, really, is the lack of information in this regulatory impact statement around the alternative options. The Government said, right from the outset, in this regulatory impact statement that doing nothing was not an option because the Government already said it was introducing something. So a press statement had gone out, the Government was introducing a brightline test, and then it was a matter of doing the policy work. When trying to measure where most of the sales sat in Auckland and when the houses were sold—within 1 year, 2 years, or 3 years—the share of sales within 1 year was roughly 8.4 percent. I am assuming that might be as a proportion of the total sale price, because we have information in the next paragraph down that says that between 2009 and 2013, 59 percent of all new titles were disposed of within a year within Auckland—59 percent is a huge amount—and 29 percent of new developments in North Auckland were traded within 3 months.

The statement then goes on to talk about the share of sales between 3 and 5 years. That is the only area where we have any data, though. When you flick over, into the regulatory impact analysis—and this is important because here we are proposing in this amendment to move from 2 years to 5 years—the only two options in the regulatory impact statement were option 1, which was a 2-year brightline test, and option 2, which was a 3 to 5-year brightline test. So it was an option that was on the table. That is interesting, of course, and useful for us, but let us delve further and see what level of comparison and detail there was, because we are now on new Part 4, taking option 2 from this regulatory impact statement.

From the outset option 1 was the officials’ preferred option, but where I get confused is that it is not entirely clear to me how that decision was made. There were three policy objectives with the brightline test: (a) provide an easier rule for the Inland Revenue Department (IRD) to enforce, to target short-term speculation—so that is about ease of implementation—(b) minimise the number of sales made taxable that were required without an intention of resale, which is difficult to determine, and I do not think you can simply say that because we have got a greater percentage of sales we are, therefore, potentially reaching purchases that were made without the intention of sale, so a very arbitrary decision that you make just looking at numbers; and (c) minimise compliance costs for taxpayers in order to comply. So those are the three tests. You would think that the objective would be to go through option 1 and option 2 and say which best meets those objectives.

But when you look at the analysis for option 2, which was the 3 to 5 years—which is what we are proposing here—it says in paragraphs 29 and 30 “This option would create a bright-line similar to option 1, however with a period for the bright-line being longer at potentially three or five years rather than two years. This option has similar impacts as option 1, but with greater effect owing to its longer period.”—that is a given—“It would best meet the objective of creating an easy to enforce rule and would have the greatest positive fiscal and administrative impact.” So on at least two of the policy objectives that were set out by IRD, option 2, or the 3 to 5-year brightline test, had already received a tick—a clear, definitive tick—when compared with the preferred option. But here comes the counterpoint, which is the important one. “However, this option has the greatest risk of capturing sales that were acquired without an intention of resale.” But my point here is there is no data, there is no analysis, that really quantifies that or that puts any detail behind that—[Bell rung] Thank you, Mr Chair. Thank you for not disturbing my flow.

There is nothing that tells us really anything beyond just an assumption that because it is longer and there is a greater number of sales, by default that meant it would be capturing houses that were purchased without the intention of resale. How do we know? We do not. There was no qualitative analysis around that assumption, and yet that one line was the basis on which the Government made the decision to go with option 1, which was a 2-year brightline test. That one line—I will read it again: “However, this option has the greatest risk of capturing sales that were acquired without an intention of resale.” As a result, this is not the Inland Revenue Department’s preferred option. That is it—no data, no analysis.

I mean, I guess to be fair, I want to go just a little bit further, because there was a table provided in the regulatory impact statement that, again, actually set out its objectives, which are fiscal, economic, administrative compliance, fairness, and the impact. It went through both of these options.

Just to further highlight that I am not misrepresenting what has happened in this regulatory impact statement, I want to read that for the 3 or 5-year brightline test, the department acknowledges that it “Best meets objective (a)”, that it “Partially meets objective (c)”, which is what the 2-year one did as well, but it “Least meets objective (b)”, and that was the one around capturing sales—again, though, no data. It admitted it had no estimate of the revenue gain that would be made, and that is interesting, because if you cannot estimate the revenue it will gain, you cannot estimate the number of sales that would fall into the 5-year category, which, again, highlights that the department actually did not know that it would capture unintended sales. It said: “This option would have similar lock-in effects to option 1. This option would have the greatest impact in reducing the administration costs involved in applying the ‘intention test’ [and that it] Provides the easiest to enforce measure of the options.” In fact, I would have to say that if you did not have the subjective statement in there—the bracketed statement around option 1, “This is Inland Revenue’s preferred option.”—and if you read this document without that bracketed paragraph, then, actually, you probably would think that it would come down on the 3 to 5-year option. That is what the evidence and the objective test it set for itself would tell you would be best to do.

I want to come to consultation, because that is what is so fantastic about this amendment. We are putting forward on the Table an amendment here to extend the brightline test to 5 years, which has actually, really, already gone through a select committee process of sorts. It has had submissions, which is more than what we had for the debate on the bill so far. So we did not have select committee papers—sorry, I should clarify. We did have an issues paper released by Treasury and Inland Revenue Department. We had an issues paper that went out on the brightline test—

Chris Bishop: That’s right—that’s right.

JACINDA ARDERN: —on 29 June 2015. There were 14 submissions that were received. I know Chris Bishop will know these submissions intimately, so he will be able to tell the Committee that there were as many submissions promoting a 5-year brightline test as there were supporting a 1-year brightline test. There were only 14 submissions, however—it has to be said—but at least that was more submissions than on any other part of the bill that we have debated in this Committee so far. So there was a submission process and there was support for extending the brightline test to 5 years. And, in fact, by and large, again, those policy objectives—as I set out—at the beginning of the regulatory impact statement were, most submitters seemed to accept, largely achieved by the proposals that were being put forward by the Inland Revenue Department in its issues paper.

I really just want to conclude by highlighting again that the basis on which the Inland Revenue Department and the Government settled on a 2-year test had no data. It had no evidence. All we know is the percentage of sales within that period. I know of houses in Auckland that have sat empty for more than 2 years simply to accumulate capital gain. They were not even bought as rental investment properties, they are not even occupied by people who desperately need houses, and they have been that way for more than 2 years. If we want an effective brightline test we should be sending a clear message: a 5-year provision. That is exactly what new Part 4 would do. It would do more to improve affordability and access to the market for first-home buyers than anything else in the bill that the Government has put forward.

METIRIA TUREI (Co-Leader—Green): I first became Green Party co-leader in mid-2009. In 2010, in my second major speech, I announced the Green Party commitment to a capital gains tax, excluding the family home. It came after reviewing work that had first been started by Rod Donald, actually, when he was here. Even in those early days, the Greens were looking at the best kind of tax regime to both help provide income to the country as a whole—to build a fair tax system on which all New Zealanders could rely—and help manage speculation in the housing market. When Rod Donald proposed a capital gains tax, it was for those reasons. When I proposed it in 2010, it was for those reasons. And here we are again, having an opportunity to put in place a more comprehensive version of the capital gains tax than is currently in law—because, of course, the brightline test is, essentially, a capital gains tax, but National does not want to say it. We all know why that is.

Jacinda Ardern: Shh!

METIRIA TUREI: Yes—shh! Do not tell anybody! It is also why it is, unfortunately, so weak.

So the Green Party is very pleased to support this provision, which will extend the brightline test—capital gains tax—to 5 years from 2 years. This is critical. It is a critical tool in the cooling of the housing market. We all know that we have to use every possible tool available to us to deal with the housing crisis. We also know that a capital gains tax will have a different kind of effect over time, once properly introduced. A proper one—a good one—will provide an almost instantaneous cooling of the growth in house prices in the housing market, in the short term. That is a good thing. That then helps provide more fertile ground for some of the other tax changes that need to come into place to have a longer-term effect. On top of that, you are also building more homes, like we discussed in proposed new Part 3 of this bill around the 10,000 homes a year—also building more homes and bringing them online. So there is a whole range of steps that need to be taken, of which a proper capital gains tax—excluding the family home—is a critical part. I am very pleased to have an opportunity to discuss it again and perhaps even to improve the brightline “capital gains tax” test that is in the current law.

This is critical when we see the data that is coming out about speculation in the housing market. Investors make up around 45 percent of house sales nationwide. There is a little bit of flexibility in that number from month to month, but none the less investors are a significant part of the market across the country. In Auckland, about 50 percent of the housing market are investors, and they are driving ordinary people who are just moving from house to house as a natural part of transitions in their lives and first-home buyers out of the housing market. In the 1980s and in the 1990s the proportion of investors was never this high, and the reason why it is so high today is that we have a tax system that provides huge opportunities to investors by taking those opportunities away from ordinary New Zealand families. So we have an obligation, in Government and in Parliament, to manage our tax laws effectively so that they provide a fairer approach—so that we get the right benefit in the right places. That is what good governance is all about.

We know that mortgage lending is now well over $200 billion. That is the highest it has been since May of 2008. Those of us who were around in May of 2008 know that that was just before the global financial crisis hit. We have not had a rate of borrowing for mortgages in this country as high as this since just before the global financial crisis. We cannot continue to allow investors and speculators to dominate the housing market, not only locking out other homeowners and young families but actually putting the entire economy at risk. More and more economists are saying that the speculation in the housing market is putting the entire economy at risk—not just those in the housing market—so we need to keep looking at, reviewing, and making changes to tax law and regulation to make sure we have got the settings right to promote the best possible housing opportunities for everyone. That does include, to some extent—

Hon MICHAEL WOODHOUSE (Minister of Immigration): I raise a point of order, Mr Chairperson. I draw your attention to Standing Order 302(3) and ask that you rule this amendment out and end the debate on it forthwith, on the basis that it is outside the scope of the bill. I understand that this is an omnibus bill and that there are parts to it that are quite disparate, and, therefore, the scope of debate and the amendments that can be tabled will be necessarily broad. But this is an amendment, effectively, to a tax measure—a revenue measure. It has been suggested to me that the reason this could be in scope is that the intention of that measure is to improve the affordability of housing, but I have checked very carefully and in the time available I could not find any reference to the fact that the brightline legislation, the Taxation (Bright-line Test for Residential Land) Bill, when introduced in, I think, about May 2015 and then passed into law, had any reference to affordability as that bill’s goal. The goal of that bill was to ensure that the right amount of tax was paid in the right circumstances, and on that basis I would suggest to you very strongly that this debate is completely out of scope with the bill that we are considering in Committee.

CHRIS HIPKINS (Senior Whip—Labour): The Standing Order that the Minister just quoted, Standing Order 302(3), refers to local and private bills. It does not apply to Government bills.

Hon MICHAEL WOODHOUSE (Minister of Immigration): Speaking to that point, I would beg the Committee’s indulgence on that. Without wanting to throw the Clerk’s Office under a bus, that was the reference that I had. But I know, as does the member—who raises a sage point—that the Standing Orders are very clear about what the Committee can and cannot debate, and the amendments, which any member of the House is able to raise, need to be in scope.

CHRIS HIPKINS (Senior Whip—Labour): Speaking further to that, I say the point of order that the member has made—he may have another Standing Order he wishes to rely on, but that Standing Order he quoted does not relate to this bill, so we are happy to continue the debate while he does a bit more homework, if he wants to.

The CHAIRPERSON (Hon Chester Borrows): Members, I have considered the point of order raised by the Hon Michael Woodhouse and those points in reply by Chris Hipkins. My view is that it does appear to me—and, sorry, I have also taken some advice from the Clerk’s Office—that the intention of the brightline test is to stop the turnover of houses so quickly and to maintain a level of control on housing prices. I am prepared to allow the debate to continue at the moment and rule it as in scope, but I do have, alongside that, a parallel issue to raise with the House, and that is that the scope of this particular part as introduced is very narrow. So I am not going to allow members to carry on, effectively, just rephrasing the contributions of other members. I cannot see this debate on this part lasting very long at all.

Hon MICHAEL WOODHOUSE (Minister of Immigration): I raise a point of order, Mr Chairperson. Firstly, I would like to make a clarification and an apology to the Clerk’s Office, actually—the reference to Standing Order 302(3) was mine. The correct Standing Order is Standing Order 302(2).

While I am on my feet, can I just seek a clarification that your ruling then means that it is your considered opinion that the purpose of the brightline test legislation was indeed around housing affordability and, therefore, the amendment is within scope?

The CHAIRPERSON (Hon Chester Borrows): Knowing that that was not a challenge to the ruling but a seeking of clarification, my ruling is that the amendments are relevant to the subject matter of the bill and are consistent with the principles and the objects of the bill.

MARAMA DAVIDSON (Green): I promise that I will be speaking directly to this new part of this bill, which is extending the time to dampen the speculators’ available time when they have to pay tax when they onsell a second, third, or 20th property. I want to speak specifically from my own experience as a renter in Manurewa. This part of the legislation would directly impact on my experiences and those of others in my community.

I think for about 3 weeks now we have been in our new house. We were forced to move from our old rental and into a new property because the owner of the house gave us notice because they wanted to sell the property. As anyone can understand, being forced to move on from a rental property when you are not quite ready to is incredibly unsettling—not so much when you are an MP who has status and income, but hardly anyone has that. So this particular part of the bill is of huge concern to me.

I do want to refer to remarks that have been made by me in the Chamber earlier today about displaying too much emotion. This Government is disconnected and it does not like to be shown up for its lack of emotion. The reason why I am emotional about ensuring that all New Zealanders have a secure property—which is why dampening the market, as in what this new part of the bill would help do, is incredibly important. Part of the connection is because I am in the middle of that situation. I am living in those communities. I am experiencing it myself, albeit from a privileged position.

So I just want to continue, and say that we need a Government that understands that homes are for living in. Oh, by the way, Minister Brownlee needs to catch up—I have been sanctimonious long before now. We need our Government to understand that homes are for living in, so we will be proudly supporting this amendment, even though the Green Party would also like to extend it further, so that any second, third, or 20th property is subject to a capital gains tax. We are firmly on the side of New Zealand families and not speculators, which is where this Government is standing strong. They are out there. If there was a hīkoi tomorrow by developers up Queen Street, you would see the National Government waving the flag—

The CHAIRPERSON (Hon Chester Borrows): Talk to this part.

MARAMA DAVIDSON: Kia kaha, developers. Fair enough. OK, so that is where this Government is standing.

Some of the objection to this new part, apparently, from the Government, to extending the brightline test is because of economic concern. Has the Government seen its economy lately? It is not doing so well, so I do not know why the Government comes up with these economic concerns when everything that it has done has ruined our economy, for people and for our planet. Has it actually seen the economy lately? So, Mr Chair, I do thank you for allowing me to get up and talk about how important this is.

Manuwera and Ōtara—even though, nationwide, investors are buying more than 50 percent of properties, in particular communities it is higher. It is higher. When my house was being sold, the realtor sat at my table, looked me in the eyes, and said: “You know, you should be fine, Marama. You shouldn’t have to move. Do you know that over the past few months over 90 percent of the properties being sold in Manuwera, Marama, have been to sold investors? You’ll be right. You won’t have to move.” I swear that this is what I was told, to my face, at my kitchen table, as the realtor tried to reassure me and my family that we would not have to move.

Over 90 percent of the properties he was observing as a real estate agent in Manuwera were being sold to investors, because our poorer communities are funding speculators. Who are the bludgers here, seriously? Our poorer communities are allowing the wealth accumulation of the speculators, the very ones whom this National Government is standing beside.

IAIN LEES-GALLOWAY (Labour—Palmerston North): This new Part 4 proposed by Phil Twyford—it is important that the Committee adopts this measure, because it actually gives effect to the purpose of this bill. The purpose of the bill is to support the wider Government programme of work to increase the supply and affordability of housing. I am prepared to accept that Part 1 goes some way to increasing the supply of housing, but where this bill, overall, is deficient is in increasing the affordability of housing. That is why new Part 4, which extends the brightline test from 2 years to 5 years, is important as part of a suite of measures to actually tackle the issue of affordability.

The purpose of this bill is sound: to deal with both supply and affordability. As I say, it goes some way—a small way, we would argue on this side—towards dealing with supply, but does not do very much about affordability. There is no doubt that one of the drivers of the increasing levels of unaffordability—particularly in the Auckland housing market—is speculation, where people are purchasing houses for the sole purpose of onselling them at a profit. Stepping back and looking at things through a purely economic lens, that makes quite a lot of sense.

The housing market is, in the Minister for Building and Housing’s own words, “out of control”. House price inflation in Auckland is rampant, there is capital gain to be made, and, actually, 2 years is not a terribly long time to wait. You can put some tenants in there. You may not even bother putting tenants in there, because the potential gains are so significant that a lot of landlords would actually say: “Look, I’m not going to risk putting people into the property. They may damage the property. I’m not going to risk putting people into the property. I’m just going to sit on it for 2 years, and then I’ll get my tax-free gain after that period of time.”

So it is actually necessary—and my colleagues have discussed some of the advice that was given to the Government on this—to extend this brightline test out to a period when it is actually going to influence behaviour. At the moment we are not seeing any influence on behaviour. In fact, the Minister of Revenue just came to the Chamber and said that it was never intended to influence behaviour. That is a surprising and astonishing admission from the Government that its current brightline test is not having an impact on the affordability of housing.

We need to make this move. If the Government is serious about improving the supply and affordability of housing, then we have to extend this brightline test to a period that is actually going to change landlord behaviour and is actually going to encourage people to tenant their houses, make them available for people, and hold on to them for a long period of time, not just flick them for capital gain. That should then go some way to having an impact on the overall levels of speculation in the Auckland housing market and in other markets around the country, and have an impact on affordability.

No one is saying that speculation is the only driver of housing inaffordability. It is not the only driver of house price inflation, but, as part of a suite of measures—and members on this side have already attempted to introduce one measure through new Part 3, and I know that other measures are on the Table. As part of that comprehensive package of measures, this change to the brightline test will have some impact on speculation, and having some impact on speculation will have some impact on housing affordability. That is what is missing from this bill.

There is actually nothing in the legislation for special housing areas that puts a caveat on what you do with a house in a special housing area once you have bought it. So, actually, right now someone could buy a house in a special housing area, flick it after 2 years, and get tax-free capital gain. We actually need this measure to make special housing areas work. It is entirely appropriate that it be included in this piece of legislation. If the Government was serious, then it would get on board with this. It agreed with having a brightline test. The Government introduced it. It set it at 2 years. Why not make that measure do what it is intended to do—set it at 5 years and have an impact on affordability.

ALFRED NGARO (National): I move, That the question be now put.

Dr MEGAN WOODS (Labour—Wigram): I appreciate the chance to take a call on new Part 4 of this legislation, which is yet another amendment from my colleague Phil Twyford that has the aim of putting some provisions into this legislation to make housing affordable. This is a reasonably simple amendment. It contains a number of clauses and amendments to the Income Tax Act of 2007. What it does is it amends a number of sections in the Income Tax Act text from “2” to “5”. This may not seem like a large measure, but it is a very important measure. The reason why the amendment is from 2 years to 5 years throughout all the clauses in this amendment that Phil Twyford has put up is that that is a period of time that actually may make an impact.

When the original legislation that Mr Twyford’s amendment is seeking to amend was put through under Budget urgency, it was done so in haste. It was yet another band-aid - type approach to housing that we have become accustomed to seeing from this Government. What the Government did have at the time, however, was Treasury advice that in order for the brightline test to actually make a difference and do something in terms of cracking down on speculation, it did need to be for a period of at least 5 years. This is not something that the Government listened to. Instead of making the real kinds of changes that may do something about making housing more affordable and cracking down on housing speculation, as could have been the outcome of what the Government did, it went for the half measure—well, the quarter measure, as my colleague beside me, Kris Faafoi, may say.

Kris Faafoi: A measure.

Dr MEGAN WOODS: A measure—I will leave it at that, Mr Faafoi. The Government did not go and put in place a provision that may have made a real impact. Instead, we had this. If you have a look at the advice that the Government did have at the time—and my colleague Grant Robertson spoke about this in his earlier contribution. At the time that this was put through—

Hon Member: Consistent.

Dr MEGAN WOODS: Nothing if not consistent, is Mr Robertson—that you have been speaking about this for a period of time. It was not just Treasury that slammed the idea of making this provision only 2 years; actually, a number of tax and legal experts did at the time, as well. It is reading through this that has led my colleague Mr Twyford to put up this amendment—to actually bring into this piece of legislation, which we are in the Chamber to debate, some provisions that would mean that the brightline test would crack down on speculation, would do something around making housing more affordable, and would do that.

If you look at the modelling that Treasury did back in 2010, which is really the only modelling that we could find that could be used, you can see the very minuscule impact that the Government’s decision to limit this to 2 years was actually going to have on the problem. Based on that 2010 modelling, John Key and this Government’s brightline test were likely to impact a maximum of only 1,000 of the nearly 80,000 house sales each year, and raise just over $18 million. This is just window dressing. This is a Government pretending that it is doing something about what is clearly a crisis in this country, and that is housing affordability. It had the opportunity to do something real, it had the opportunity to do something substantive, but is that an opportunity that this Government chose to take? Unfortunately, it is not.

Instead, what it has taken is this amendment from my colleague Phil Twyford, which goes through these provisions of the Income Act and makes that change from 2 years to 5 years. It is a significant set of amendments that will mean that the brightline test may actually do what it should have done in the first place—that is, crack down on speculation. Cracking down on speculation—actually doing something to address the problem—would actually cut to the core of addressing the real issue that we have to address, and that is housing affordability. Nothing in the bill that the Government has bought to this House addresses the issue of housing affordability. It has taken amendments from this side of the House—

JOANNE HAYES (National): I move, That the question be now put.

A party vote was called for on the question, That the question be now put.

Ayes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Noes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Motion agreed to.

The question was put that the following amendment in the name of Phil Twyford be agreed to:

add the following new part:

Part 4

Amendments to Income Tax Act 2007

11 Principal Act

This Part amends the Income Tax Act 2007.

12 Section CB 6A Amended (Disposal within 2 years: bright-line test for residential land)

(1) In the heading to section CB 6A replace “2” with “5”.

(2) In the chapeau to section CB 6A “Disposal within 2 years” to section CB 6A replace “2” with “5”.

(3) In section CB 6A(1) replace “2” with “5”.

(4) In section CB 6A(2) replace “2” with “5”.

(5) In section CB 6A(3) replace “2” with “5”.

(6) In section CB 6A(4) replace “2” with “5”.

13 Section CB 16A Amended (Main home exclusion for disposal within 2 years)

In the heading to section CB 16A replace “2” with “5”.

14 Section DB 18A Amended (Ring-fenced allocations: disposal of residential land within 2 years)

(1) In the heading to section DB 18A replace “2” with “5”.

(2) In section DB 18A(1) replace “2 years” with “5 years”.

15 Section DB 18AB Amended (Deduction cap: disposal of residential land within 2 years to associated persons)

(1) In the heading to section DB 18AB replace “2” with “5”.

(2) In section DB 18AB(1)(a) replace “2” with “5”.

16 Section FB 3A Amended (Residential Land)

In section FB 3A(1) replace “2” with “5”.

17 Section FC 9 Amended (Residential land transferred to executor, administrator, or beneficiary on death of person)

In section FC 9(2) replace “2” with “5”.

18 Section FO 10 Amended (When property passes on resident’s restricted amalgamation)

In section FO 10(1) replace “2” with “5”.

19 Section FO 17 Amended (Land)

(1) In section FO 17(1)(b) replace both instances of “2” with “5”.

(2) In section FO 17(3) replace both instances of “2” with “5”.

20 Section GB 52 Amended (Arrangements involving residential land: companies’ shares)

In section GB 52(1)(a) replace both instances of “2” with “5”.

21 Section GB 53 Amended (Arrangements involving residential land: trusts)

In section GB 53(1)(c) replace “2” with “5”.

22 Section YA 1 Amended (Definitions)

(1) In the definition of “bright-line date” in section YA 1 replace both instances of “2” with “5”.

(2) In the definition of “date of acquisition” in section YA 1 replace both instances of “2” with “5”.

(3) In paragraph (c) of the definition of “settlement” in section YA 1 replace “2” with “5”.

A party vote was called for on the question, That the amendment be agreed to.

Ayes 48

New Zealand Labour 32; Green Party 14; Māori Party 2.

Noes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Abstentions 12

New Zealand First 12.

Amendment not agreed to.

New Part 5 Amendments to Overseas Investment Act 2005

PHIL TWYFORD (Labour—Te Atatū): The next important policy that we need to discuss as part of this debate about housing affordability is set out in proposed new Part 5 of this Housing Legislation Amendment Bill. What this part does is it amends the Overseas Investment Act to ban non-resident foreign buyers from buying existing homes.

Hon Michael Woodhouse: I raise a point of order, Mr Chairperson. I apologise to the member on his feet. I draw the same Standing Order to you—Standing Order 302(2)—and suggest to you that the Overseas Investment Act’s purpose is nothing to do with housing affordability. In particular, the references to sensitive land, which generally is farming land and outstanding landscape areas—that is very unlikely to ever have houses built on it and therefore is out of the scope of this bill.

Chris Hipkins: First of all, and I think this is perhaps the most substantive issue here, these amendments have been ruled in order by you, Mr Chairperson, and by the Office of the Clerk. You are the sole determinant of relevance in these matters, and being bullied by Ministers should not change your ruling. You have already ruled on these matters and they have been ruled in order, and the challenging of your ruling by Ministers is unacceptable.

The CHAIRPERSON (Hon Chester Borrows): To be clear, I have not given any ruling on this yet, although I accept that it has been through the Clerk’s process. I certainly do not feel bullied by my parliamentary colleague the Hon Mike Woodhouse. [Interruption] Well, I am going to take some time to consider this matter momentarily.

PHIL TWYFORD: As I was saying, the Government is clearly in denial on this issue, as it is on so many aspects of the housing crisis. It refuses to acknowledge what every New Zealander knows, and that is that non-resident foreign buyers are a significant force in the housing market, and, unquestionably, as marginal buyers they are having the effect of driving up house prices.

A Cabinet Minister was interviewed on Radio New Zealand a few weeks ago on this issue, and she was asked by Guyon Espiner, the co-presenter of Morning Report, what the good bit is about even one home being sold to a non-resident foreign buyer. The Minister could not answer. She had no answer because there is no answer. There is no benefit to New Zealand or New Zealanders in allowing people who are not residents or citizens of this country to sit on the other side of the world and buy and sell our homes for capital gain. There is simply no benefit in that.

So many countries have recognised that it is the duty of the Government to look after its citizens and that it is the responsibility of the Government to ensure that markets are allowed to work properly and deliver the benefits that are expected from them. Australia has the policy of banning non-resident foreign buyers from buying existing homes. That policy has effectively channelled $30 billion of foreign direct investment into the construction of new properties—new homes—in Australia in the last 12 months. Singapore, Hong Kong, Malaysia—all have restrictions on non-resident foreign buyers buying residential property in their countries. In China it is not possible for non-residents to buy dwellings in Shanghai or Beijing, because the Chinese Government is protecting the interests of local residents in those communities against instability in the housing market denying citizens and residents in those cities from actually being able to access affordable housing.

Most recently, Justin Trudeau, the Prime Minister of Canada, said that there was no doubt in his mind that foreign buyers were driving up house prices in Vancouver and Toronto, and shortly afterwards the provincial government of British Columbia implemented a 15 percent stamp duty—a 15 percent stamp duty in British Columbia—to try to deal with the massive influx of overseas money that has destabilised the Vancouver housing market and made it, like Auckland, one of the most unaffordable housing markets in the world.

The other interesting development on this issue happened a few weeks ago, when every one of the major trading banks in this country announced that they were ceasing lending to non-resident foreign buyers of residential property—every single one of the banks. Their parent banks in Australia have done exactly the same thing. Would the banks, which have billions and billions of dollars of skin in the game, which lend tens of billions of dollars to homebuyers in New Zealand every year, do that if foreign buyers were not a significant presence? Of course they would not. It was the final blow to the credibility of this National Government and its denial that foreign buyers are a problem in the residential property market.

What proposed new Part 5 does is it amends the Overseas Investment Act and it inserts a new category of property: overseas investment in residential property. What it does is that it applies the same definitions that exist in the Overseas Investment Act that determine whether a person or a company or a trust is to be regarded as foreign—that is, if they have 25 percent or more ownership or control that is not by New Zealand citizens or New Zealand residents—to investors in residential property. Then it makes it clear that an overseas entity cannot buy an existing property, but it could build a new one. That is the policy that we have here. That is the policy of the Australian Federal Government, and we think it makes a lot of sense. We believe—the most overused phrase in the housing debate—that this is not a silver bullet, but it is something that will make a significant difference to what is an extremely overheated housing market that has a tendency to a housing bubble. Thank you.

The CHAIRPERSON (Hon Chester Borrows): Members, I am going to give a ruling in respect of the point of order raised by the Hon Mike Woodhouse. I accept that the reason behind this particular legislation, which is seeking to amend the Overseas Investment Act 2005, seems to have apparently two distinct philosophical reasons as to why it is there. One of them is to limit the ownership of land in New Zealand by foreign buyers; the other is that it would have an effect on affordability by removing foreign buyers from the market. The test as to whether or not it is in scope is the debating point as to whether or not, if this part was to be accepted and to go on and be in the bill, it could have a dampening effect or the effect of making more affordable houses available in the market. So, by reason of that, having taken and listened to the points of order and having taken advice from the Clerk’s Office, I am going to rule it in scope.

Hon MICHAEL WOODHOUSE (Minister of Immigration): I raise a point of order, Mr Chairperson. Thank you for your considered judgment. I certainly do not intend to labour this point but I will ask for one point of clarification, which I did not raise earlier. In an omnibus bill, by and large, more than one bill is being amended and a Supplementary Order Paper (SOP), by and large, is designed to amend the bill being debated. What we now appear to have is a ruling that because two bills are being debated and amended in a single piece of legislation, any other piece of legislation could now be proposed for amendment, because we now have the Income Tax Act, the Overseas Investment Act, and the Resource Management Act all, effectively, within scope here notwithstanding that they have nothing to do with the bill being debated. I just want to clarify that the point now is that it is open slather on SOPs. [Interruption]

The CHAIRPERSON (Hon Chester Borrows): The members who are choosing this particular time to give us the pearls of their wisdom have chosen to do so during the taking of a point of order, and they should not do that. I hear the member’s point of order. I do not agree for a moment that it is open slather. Matters will have to be on point. Unfortunately—or fortunately, depending on which side of the Chamber you sit—the terms of this bill were very broad. If somebody wants to seek a clarification or seek a further ruling, then that is open to them. I have given my ruling and I am prepared to stand by that. I accept that there are other heads in the game. If the member wishes to take that and seek a review of my ruling, then I am quite happy for that to happen.

Hon DAVID PARKER (Labour): I want to carry on from where my colleague Phil Twyford left off, making the link between foreign buyers and affordability in the New Zealand housing market. The Labour Party position is that if you have got the right to live here, you have got the right to buy here. That is true, whether you are a migrant who has arrived just a month ago with permanent residency or you are someone who has lived here for ever. If you do not have the right to live here we do not think you should have the right to buy here, because we think that is having an effect on the price of housing.

The experience around the Pacific Rim, and in London and other places that are safe havens for capital in a turbulent world, is that with the free flow of capital, unconstrained by local rules relating to homeownership, those flows of capital pump up the price of housing beyond the price that locals can afford to pay. So the effect of not having a control on foreign buyers of New Zealand land with houses on it is that the housing starts to be priced not according to the means of New Zealanders to buy housing but according to the deep pockets of those who are from overseas.

There can be a debate as to how much the effect from foreign buyers is on prices, but there cannot be a reasoned debate that there is none. As to how much the effect of foreign buyers is—countries around the world are concluding that it is a material and substantial effect. Australia has moved to stop it. Canada has moved to stop it. Hong Kong has moved to stop it. China has moved to stop it. There are huge controversies in London and the United Kingdom. One of the reasons behind Brexit was that people cannot afford housing in those large centres.

In New Zealand the evidence is pretty clear. You know, there are billboards that are put up periodically in Ponsonby Road—some of the most expensive billboard space in New Zealand—advertising real estate agents to list your properties with, who are selling directly into China. They are selling directly into China. They advertise their websites. Those billboards—we cannot afford them in the Labour Party. It costs many thousands of dollars each week to hire that billboard space for an advertisement. There is a lot of money being made on the sales of New Zealand houses to overseas interests.

Another example—we know that some of the people who, if you like, win the prizes for being the most successful real estate agents in Auckland are those who are servicing those markets. We have got instances of buyers from overseas coming to New Zealand and not buying one house but actually buying many houses on the same day, some of them sight unseen. I make the point again that this is not somehow anti-Chinese or, as it used to be, anti-Japanese or anti any other ethnic group. You know, I have been accused of those things previously when, in respect of rural land, I criticised American purchases, Swiss purchases, and French purchases. And when I criticised Chinese purchases in respect of Shanghai Pengxin’s purchase of the Crafer farms, it was then that I was accused of racism or xenophobia, when I was making the same point every time, and that is that the market for New Zealand land assets—and, in this case, housing assets—should be a New Zealand market, not an overseas market.

Why do we need this law? Why do we have to make this clear, that the Government has not got the discretion to allow our houses to be sold overseas? Well, we know that the Government has traded away our rights to put in place a control such as that under the Korean free-trade agreement. Korea retains the right to stop New Zealanders buying their houses, but, under the Korean free-trade agreement, the Government agreed that we would never ban the sale of New Zealand houses to Korean people, notwithstanding that in the free-trade agreement that had been agreed to within the last year or two with Australia, South Korea agreed that Australia could stop Koreans buying Australian houses.

So, of course, the even bigger effect of that is the flow-on effect into other trade agreements, because under trade agreements they have the most favoured nation clause, which, effectively, says that if you do a better deal in a later trade agreement than in your original trade agreement, it flows through to the benefit of the earlier trade agreement.

The Labour Government of which I was part negotiated the free-trade agreement with China. I was in Cabinet and I remember sitting in a policy committee—because I had been worried about these land issues for a long time—and I asked the question: “Have we retained the ability to control whom we sell our houses to and change those rules?”. Annette King is nodding her head. She was probably in the same policy committee. I can remember Helen Clark saying: “We’d better check that.” The officials could not answer it on the day, and so we asked the officials to go away and check that under the Chinese free-trade agreement we were retaining the right to change which asset classes we restricted Chinese people buying into in New Zealand. The answer was “Well, China is retaining the right to ban New Zealand buyers of their houses.”, and, under the Chinese free-trade agreement, New Zealand retained the right to ban Chinese purchases of New Zealand houses.

How did that change? Because of the most favoured nation clause, which is in just about all of our trade agreements, because the National Government gave away—it sold New Zealanders down the drain, under the South Korean free-trade agreement. That provision flows through, under the most favoured nation clause, to China. That can be fixed—because I am sure the South Korean agreement could be fixed if we had a Government that wanted to—as evidenced by the fact that South Korea has retained the right in South Korea to ban New Zealand buyers of homes in its country, and Australia got the same thing. So it is an absolutely ideological selling out of New Zealanders’ interests, trying to curb the rights of a future Government.

But it gets worse. What is the biggest trade agreement in the world? The Trans-Pacific Partnership (TPP). What did this Government do in the TPP? Notwithstanding the lesson that we thought we had taught the Government and notwithstanding the fact that, actually, Labour is a pro-trade party, National went further and, in the investment protocols under the TPP, said that New Zealand would not introduce new areas of screening—i.e., we would not ban the overseas sales of New Zealand houses to Americans or Japanese or anyone else in the TPP. That is why we need this amendment, because this amendment amends the Overseas Investment Act to make it clear that the Minister cannot just wash his hands of the effect of putting the best of our houses out of reach of New Zealanders and lifting the price of houses in a way that is unaffordable in New Zealand.

If passed, this amendment closes that glaring hole in New Zealand’s law and says that if you have got the right to live here, you have got the right to buy here, that it should be a New Zealand market, and that we should not have people from overseas who are the “1 percenters” of the world—and sometimes coming through with dirty money, which we have seen through the Panama Papers. Those sorts of people cannot come here, with some of it being stolen money or whatever else—they cannot come here and outbid New Zealanders for our houses.

Houses are to live in. The people whose interests we should be serving most are New Zealanders. They are the people whom the New Zealand Government should be acting to protect, not foreign buyers who want to speculate, who want to move money to a safe jurisdiction, who want to have another investment class, and who want to price New Zealanders out of our own homes.

This Government, in this area, most plainly prefers the interests of overseas people over New Zealanders. That is why this provision is so essential if we are going to get the housing crisis in Auckland under control, because most of that purchase pressure is in Auckland. The Korean free-trade agreement, the Chinese free-trade agreement, the Trans-Pacific Partnership agreement—what more proof do you need that you need change in the underlying legislation? This Parliament should be telling the executive that in respect of these things, New Zealanders do not want to sell down the river the right of future Governments to control who buys their houses.

We have got the ability, in this vote, today, to put that into law, and I bet you that the Government will try to block it. It has already even tried to close down debate on the issue, through Minister Woodhouse—

JULIE ANNE GENTER (Green): The Green Party is supporting this amendment, proposed Part 5, from the Labour Party. As the two previous speakers very well explained, it is vital that we address the issue of foreign capital in our housing market. It is very simple. The Green Party believes that every New Zealander should be able to live in a warm, healthy, safe, secure home, and they should not have to spend more than 30 or 40 percent of their income to access that. That is a fundamental human right. That is good for our society. If the Government wants to achieve that outcome, it has to be realistic about the many various challenges that are impacting on our housing market, and it is not realistic for the National Government to avoid this part of the debate and claim that anyone who raises the reality of foreign capital pouring fuel on the housing fire that is happening in Auckland—it is just denying reality; it is a basic economic fact.

I heard some of the members last night, like David Seymour and some of the Government members, talking about housing markets and how they should work, and one of the key things that they did not address is that housing is not a commodity. It is not like cars or bicycles or dishware or glasses or pens. It is not like that because real estate is fixed, and so if we have a lot of money coming in for a fixed amount of land and number of houses, then of course it is going to increase the price of that and it is going make it harder for people to access housing.

The reality is that every home that is sold to an overseas investor is a home that a local family cannot buy. We do not have a capital gains tax, we do not have a warrant of fitness, and we do not have really adequate renters’ protections, and so we have got these foreign speculators. There is nothing wrong with being foreign. It is just, you know, they are not invested in New Zealand, they have got no requirement to look after their tenants, and they are able to make tax-free capital gains on the appreciation of property prices. That is not good for New Zealand and that is not good for our economy, and let us just be realistic about that.

The Green Party policy is a little more ambitious than this amendment. Actually, this amendment does not ban all foreign buyers, at all. It just requires people buying residential property to be New Zealand citizens: either people who normally live here or people intending to live here indefinitely. It even allows for people temporarily coming to New Zealand and intending to sell their property when they leave, to buy property, and people buying bare land with the intention of building new houses or homes, or buying existing dwellings with the intention of upgrading them into a greater number of dwellings—they are all able, under this amendment, to buy land and property. So it is actually quite a reasonable approach, and I cannot understand why the Government would not consider such a reasonable, well-researched proposal that will definitely have an impact on house prices in Auckland and make homes more accessible to New Zealanders who live here and do need a place to stay.

The Green Party message is very simple. Our longstanding policy has been to limit sales of property to residents and citizens. I am an immigrant. There is nothing xenophobic about saying that you have to have the intention of living here or be a citizen if you are going to buy property, because that keeps the market domestic and accessible for the people who need to live here. It is a simple message: if you want to make New Zealand your home, you are welcome to buy a home here. If you want to become a permanent resident or citizen, you are welcome. If you want to come and do those things and buy a house please, please—that is absolutely available. Right?

But if people are going to sit in offices in Sydney, or Singapore, or San Diego and play games with our property market to make a buck without actually putting in any real investment here in New Zealand, then that is not welcome. I think most New Zealanders would agree with that. It is really unfortunate that the Government is not willing to debate the issue, and that it just claims that anyone who raises the issue is racist or xenophobic when it actually has nothing to do with racism or xenophobia or not wanting people to come to New Zealand. It is about protecting homes in New Zealand for those people who do live here and making sure that they are accessible to all people in New Zealand.

The CHAIRPERSON (Hon Trevor Mallard): I will call Grant Robertson, but before I do so I just want to indicate to the Committee that there are more amendments on the Table. There were two amendments, which sought to insert a new Part 7. I am ruling that Metiria Turei’s, which was the first, will be new Part 7 and, I think, Mr Twyford’s one, which was the other one, will be new Part 8.

GRANT ROBERTSON (Labour—Wellington Central): Thank you very much, Mr Chair, and I look forward in the course of the coming days to debating new Parts 7 and 8 of this bill.

On new Part 5, I want to make a couple of significant points. The first is the question around whether or not new Part 5 contributes to the purpose of improving the affordability of housing. I do want to note that the Government, in its tinkering, timid kind of way when it comes to housing, did realise that this was an area that could contribute to improving the affordability of housing. In the Budget 2015 speech when Bill English introduced the brightline measure that we discussed earlier in new Part 4, he also introduced the foreign buyer register, which I am going to come to in a moment, and in doing so, when he introduced that in Budget 2015, he actually used the phrase that this was part of a number of measures that would take pressure off the Auckland housing market. That is what he said. So the Government was quite clear that an initiative that started to address the impact of foreign buyers on the New Zealand housing market was a measure not just about taxation, not just about land, but actually about easing the pressure on the Auckland housing market, which today the Minister for Building and Housing has confirmed for New Zealanders is out of control—and it most definitely is.

The second thing I want to raise in that regard is the question of the disproportionate impact of foreign buyers or speculators on the New Zealand housing market. The kinds of people who are involved in this level of speculation are prepared to pay well over the odds for housing, which pushes the prices up overall and has the effect of pushing first-home buyers out of the market. I want to give an example from here in Wellington from somebody who I know had been living in a rented house in a northern Wellington suburb and had to leave the house because it was sold from under them and the rent was put up. The reason the rent was put up was that the house was sold to an offshore buyer for some $500,000 over the Government valuation that it had.

Hon Annette King: Sight unseen?

GRANT ROBERTSON: Sight unseen. In fact, talking to the real estate agent responsible for that sale, he said that within an hour of that property going up on their website, 13 offers had come in, 12 of them from offshore speculators—12 of the 13 offers came in from offshore speculators—and someone at the end of the day was prepared to pay $1.2 million for a house worth about $700,000. That is the disproportionate impact of an offshore speculator on the New Zealand housing market. Often, with capital accessed at a much lower rate or capital that they want to shift quickly out of the country that they are resident in, the New Zealand housing market represents an opportunity for speculation, and it is that speculation that is driving up property prices and is pushing first-home buyers out of the market.

So this new Part 5 is a measure to improve the affordability of New Zealand housing. The question does remain: what is the extent to which it will improve the affordability of housing? This is obviously a very live debate, because the Government, as I said, in Budget 2015 decided that it would announce, as part of its desperate attempt to look like it was doing something in the housing area, a foreign buyer data register. We have now seen a couple of releases of information from that register, but they do not give the full picture. The Government likes to tell us that foreign buyers, according to its data, represent 2 or 3 percent of the buyers in the market, but a closer analysis of the statistics reveals that there is a giant fudge going on here by the Government. In the last data that was released, the Government told us that of the sales of houses in the last year, 2,300 of them went to non-residents—people who, as has been described to us today, are not people who come here. These are people who do not have a right to live here, who do not live here, and who have no intention of living here—except that is not quite what the Government has done, because, in addition to those 2,300 non-residents, another 5,700 properties were purchased by—[Bell rung] Mr Chair?

The CHAIRPERSON (Hon Trevor Mallard): Grant Robertson.

GRANT ROBERTSON: That is very good—nice. Ha, ha! Thank you very much, Mr Chair. That means another 5,700 were—I am good with people stretching their legs without saying anything. It is excellent—good work. So a further 5,700 were bought by people on temporary visas, including students. These are people who do not have the right to stay and live in New Zealand on a permanent basis. So if we add together the 2,300 that were bought by non-residents, as defined by the Government, to the 5,700 that were bought by people on temporary visas, that actually amounts to 13 percent of the total sales—well in excess of what the Government is admitting and quite clearly having a major impact on the housing market and the price and affordability of housing.

So what is the Government’s response to the fact that it brought in a foreign buyer data register, that there was pressure on it about this? Its response is twofold. It is to put out dodgy numbers and to call anyone who raises the spectre of this, as an issue, xenophobic. That is ridiculous. It is typical of this Government putting its head in the sand about housing issues rather than facing up to the impact of them. So when we have a situation where yesterday the average house price in Auckland hit a million dollars, and the Government says that the housing market is out of control but it has got no plans to change it, that is not on. It is a Government in denial now pushing housing further and further out of the hands of New Zealanders.

If you want to know the impact of foreign buyers, of speculators in the housing market, and of the lack of supply from the Government, Bill Rosenberg from the New Zealand Council of Trade Unions has calculated that if average wages had increased at the same rate as house prices in the last few years, the average wage would now be $69 per hour instead of $29 per hour—if the rate of wage increases had kept up with the rate of house price increases. It is out of control, and it is being fuelled by people from overseas who look at the opportunity for a speculative gain in the New Zealand housing market.

Phil Twyford: And why wouldn’t they?

GRANT ROBERTSON: Exactly—and why wouldn’t they, in an environment where there are few rules around them and where all around the Pacific area and all around the world countries have said their priority is to make sure the people who are resident there have the first chance to get themselves into housing. That is the priority. Australia does it. Other countries within the Trans-Pacific Partnership have carved out the right to do this. Vietnam and Malaysia have got it, China has got it, but New Zealand does not, and that is a failure on behalf of this Government, because it has simply decided to wish the problem away.

New Part 5 of this bill offers the opportunity for this Government, quite clearly, to take on board a policy that will improve the affordability of housing. In my time remaining I want to make one thing very clear, and that is that this is about—and this is important for us on this side of the Chamber—the purchase of existing housing. We do need to add to the supply of housing in New Zealand, and we do know that some of the good, positive developments in housing that have been taking place in Auckland have actually been funded by money from offshore, but that is new housing—that is adding to the stock. It is helping to solve the problem. Speculating on existing housing, driving up the prices, does nothing to solve the problem. It makes the problem worse. That is what new Part 5 of this bill aims to address: people with no interest in moving here, people with interest only in speculation. So I want to make it clear: that is covered here within new Part 5, the new section 17A(c)(iii) within new Part 5. It covers off the fact that if people are going to add to the housing stock and create new housing, that is a good thing, and can be managed within the regime that we have, but if all they are interested in is speculating, driving up housing prices, and pushing young New Zealanders out of buying their first homes, then that has got no place.

This is one aspect of a comprehensive plan for housing, along with building affordable housing, along with increasing the stock of State housing, and along with fixing the homelessness crisis. We have the comprehensive plan over here. Here is one part of it. Here is a chance for National: step up, vote for this, and do something instead of sitting on your hands.

KRIS FAAFOI (Labour—Mana): New Part 5 of this bill is a fascinating part, and I want to concentrate on clause 15. But, before I do that, I would like to just pay tribute that we are into the 13th hour of this debate, and it feels a little Telethon-like, because when you are doing something for the benefit of the whole country it feels like fun, and I think, at the end of the day, everyone will benefit, especially if Part 5 becomes part of this legislation.

Part 5, clause 15, looks to insert new sections 17A and 17B into the Overseas Investment Act. Section 17 in the said Act is titled “Factors for assessing benefit of overseas investments in sensitive land”. There is in clause 17A, which we would like to insert into that Act, some criteria for approval of overseas investments in residential property. I do not want to dwell too long on clause 17A, but I think it is relevant for me to pass through them quickly, just so people get a flavour of what kinds of criteria there will be.

Clause 17A(1)(a) is a good character test. Clause 17A(1)(b) is, essentially, an immigration test to make sure that the people who could potentially invest in residential property would meet Immigration Act criteria. But the interesting thing with clause 17A(1)(c)(iii) is that “the overseas investment will, or is likely to, increase the supply of housing in New Zealand, as determined by the relevant Minister under section 17B.” Before I get to section 17B, I do want to point out what that says: “increase the supply of housing in New Zealand”.

Pointing to some of the concerns of the Hon Michael Woodhouse around the relevance of Part 5 to this piece of legislation, I think it is quite simple to say that if you are increasing the stock of housing in New Zealand, if you are an overseas investor and you are looking after that in a systemic way, then you are helping housing affordability. So that is why I think section 17B is quite fascinating, and should be something that any Government that wanted to have a comprehensive housing plan should have in place, because 17B does, again, set out criteria for overseas investors in residential supply, in terms of increasing the housing supply.

One of those criteria for investment, in clause 17B(2)(a)(i), is that “the overseas investment is in vacant land and the relevant overseas [person] is committed to building premises used or intended for occupation by any person as a place of residence:”. In plain English, that is an empty plot of land on which that person who is investing in that from overseas is going to build houses for people to live in, whether it be themselves or someone else, or both of those, that would increase the housing stock here in New Zealand, which would be a good thing for housing affordability. If the Hon Michael Woodhouse cannot see the sense of that—

The CHAIRPERSON (Hon Trevor Mallard): Order! There was a point of order on which there was a considered ruling, and the member—I should have pulled him up earlier—cannot go back to relitigating that area.

KRIS FAAFOI: Thank you. But if the Government cannot see how that would be good for increasing the supply of housing for housing affordability, then I think it may need to rethink its plan.

The second one, in clause 17B(2)(a)(ii), is that the overseas investment is in premises already existing and “[the relevant overseas person] is committed to redeveloping that site to contain a greater number of places of residence:”. Again, in English, that might be that someone might buy a property that is a singular house, they may invest in that, and they may turn that into five or six flats or subdivide that area and build more houses, therefore increasing the supply of housing, which, again, is good for housing affordability.

The third criteria, under clause 17B(2)(a)(iii), is that the overseas investor is investing in “existing premises used or intended for occupation by any person as a place of residence that is not currently suitable for habitation and the relevant overseas person is committed to redeveloping that site to make it fit for habitation;”.

DENIS O’ROURKE (NZ First): Overseas purchasers do have a big effect on the New Zealand housing market. The Government has never admitted that, and in questions at question time over some years now this has been challenged. The Government has constantly said “No, they don’t have much effect—no, they don’t have much effect.” and has brought up spurious data to try to prove that. But the reality is that they do have a big effect. They have a big effect because they tend to buy land purely for capital-gain farming purposes only. They tend to land bank land, they tend to speculate, and they tend to buy homes and sit on them and not rent them out because that is an inconvenience. They are interested only in the capital gain. As I have said, what they are really doing is just capital-gain farming.

You can understand why—now that the average price of Auckland houses has reached a million dollars. When you look at the unbelievable capital gain that has occurred, even over the last year, you will see why the overseas purchasers with plenty of money are very keen on buying New Zealand homes. Therefore you see, in various parts of the world, advertisements—even by New Zealand real estate companies—encouraging overseas purchasers to buy in New Zealand. At various times New Zealand First has produced such advertisements sourced from China and sourced from Singapore. No doubt they occur in other places, as well.

Other nations have moved in the way that is proposed in this amendment, proposed Part 5, and they have placed severe restrictions on overseas purchases of residential land, either just through absolute prohibitions—which New Zealand First favours—or through the taxation system. This Government has done nothing. Why has it done nothing? Nobody really understands, because overseas purchases for capital-gain farming purposes confer no benefit on New Zealand whatsoever, and, indeed, they do significant damage.

I want to move on to the particular provisions in this amendment, which New Zealand First would like to be able to support. New section 17A, inserted by proposed new clause 15, is the crux of them, and they provide the criteria. Apart from good character and the ability to get a visa under normal rules, the important part, I think, is section 17A(1)(c), which requires one of a number of criteria to be met. The first we agree with—that the person has to be a New Zealand citizen, ordinarily resident in New Zealand, or intending to reside here indefinitely. We agree with the second—that the relevant overseas person intends to reside in New Zealand temporarily, but with an agreement to sell their New Zealand property if they then leave. That, of course, must be properly evidenced and guaranteed.

The third one is the one that we disagree with. I have moved an amendment to proposed new Part 5 to remove section 17A(1)(c)(iii), which is the one that allows overseas investment if it is likely to increase the supply of New Zealand housing, and, consequentially, I have moved the deletion of new section 17B as well. The reason for that is very simple. That is that we do not believe that it would be possible to properly police that subparagraph (iii) relating to the increase of supply of housing in New Zealand. How that could be properly evidenced? I know that there is section 17B there, which tries to achieve that, but I do not think it can. I think it makes the policy far too weak—there are too many let-offs in it. We could not support it. We just want a simple prohibition of purchasing residential land in New Zealand; we do not see any need for that exception.

If my amendment is not passed, we will be unable, unfortunately, to vote for this amendment inserting new Part 5, because it is such an important issue for us. We think that it is absolutely vital that overseas purchasers of residential land in New Zealand should be people who actually live here, or who are citizens, wherever they reside, or people who want to come here and reside permanently in the country. We do not want any other let-out as far as overseas purchases are concerned. So we cannot support section 17A(1)(c)(iii), and we hope that the other parties in the Committee will look at my amendment and pass that to amend this amendment, so that New Zealand First will be in a position to support it as well.

CHRIS HIPKINS (Labour—Rimutaka): I am very pleased to take a call on proposed new Part 5 of the Housing Legislation Amendment Bill, inserted by Phil Twyford’s amendment, and before I begin my comments on the specific provisions of this, I do want to acknowledge the growing levels of frustration on the benches opposite. I want to say that the power to end this debate is entirely in the Government’s hands. If the Government is willing to send Part 2 of this bill to a select committee, so that the confiscation of property rights can be adequately considered, then the debate will be all over. But if it is not willing to do that, then the debate will continue. The power to end this debate is entirely in the Government’s hands—I suggest those members have a conversation about that.

I move to new Part 5, which amends the Overseas Investment Act to consider, basically, a housing interest test when overseas buyers are buying New Zealand housing. The question that we should always ask about overseas investment—and I stand here as someone who supports overseas investment in New Zealand—is what the benefit is to New Zealanders. What extra benefits are we getting from the overseas investment? If they are buying a business we have good tests around what the extra investment would mean for New Zealand. If they are buying sensitive land we have a test that asks what extra benefits New Zealanders get from this purchase. Why do we not have similar criteria around overseas investment in our housing market? Surely the question we should be asking is what we are getting.

If we are allowing somebody who is not resident in New Zealand to come to buy housing, what is the benefit to New Zealanders? At the moment no such test exists, and this provision inserts that. By doing so, it would prevent an overseas investor from simply buying up residential properties for the sake of raking in profits, which are then removed from New Zealand, which then pushes up the price of rental accommodation and excludes New Zealand buyers from the housing market, and it would ensure that those houses would otherwise be available to New Zealand purchasers—first-home buyers, potentially, or other New Zealand - based resident investors. So why do we allow unrestricted overseas investment in New Zealand housing at the moment? There really is not any good justification, because if we go back to that very first test around what value that delivers to New Zealand, it arguably does not deliver any.

So I want to turn, particularly, to new section 17B, in new Part 5, which talks about assessing the value of overseas investment in New Zealand housing, and I want to talk, particularly, about subsection (2)(a)(iii), which is where an overseas buyer is purchasing “existing premises used or intended for occupation by any person as a place of residence that is not currently suitable for habitation and the relevant overseas person is committed to redeveloping that site to make it fit for habitation;”. We have got a number of buildings throughout New Zealand that at the moment do not meet code. Many of them are owned by local authorities, but some of them are privately owned—some of those old Housing New Zealand Corporation blocks, for example, that need significant improvement in them, that are now privately owned or no longer owned by the Housing New Zealand Corporation. They need significant improvement in their present form. Although some of them, regrettably, are currently tenanted, they are not suitable for human habitation, and it is an indictment on our current housing policies that we have actually got people living in housing that is currently not fit for human habitation.

If an overseas investor were to buy those properties that are so badly run down that they cannot be occupied without significant investment, and there is nobody else domestically—that is the other test that has to be applied—who would be willing to make that investment, then they are going to be increasing the supply of housing for New Zealanders. There could be a case to be made for the overseas investor to be allowed to buy that, because those dwellings are otherwise unoccupiable, and without that overseas investment they would not be occupiable. So there could be a case made for that. This bill introduces that, and it allows for that to happen. I actually think that the threshold would have to be reasonably high because, as I have indicated before, the second test has to be whether there would be someone in New Zealand who would be willing to do that, and make that investment. If there is, then there is no justification for the overseas investment.

So it is not just a question of “Does the opportunity exist?”. The test, then, also has to be “And is there nobody else who could take up that opportunity, or who would be willing to take up that opportunity, or who would have the capital available to take up that opportunity?”. New Zealand housing should be for the benefit of New Zealanders. We, as a Parliament, should certainly be making sure that New Zealanders are the first in the queue.

MARAMA DAVIDSON (Green): Let us go back—well, not back; it is still around—to that amazing game of Monopoly, where we sit around looking at a board, we move properties around, and we throw our money in the middle. Basically, we should be able to have the desire to prevent New Zealand being played around with in this way. You can sit around in a room—today it is probably on the internet—have a look at what is available in that country over there, and have a little bit of a play around: “We’ve got spare money, we’ve got spare cash—I’ll take that. I’ve never been there, I perhaps never will; I’ll take that, and I’ll take that.”

Other countries have decided that they cannot live with that—plenty of other countries. For example, in Vancouver there is a new 15 percent stamp duty tax on overseas buyers. Other countries have had the courage to do what is right. Australia, as we keep hearing, does not sell land to foreign investors unless they are going to build a new house on it. So other countries have been as appalled as we should all be, and have put in place rules to ensure that all of our New Zealanders first have a fair go at being able to buy our own houses and land. All of our New Zealand residents—our Chinese New Zealand residents, our Japanese New Zealand residents, our Mexican New Zealand residents, all of our New Zealand residents—should have a go first at being able to buy our houses and our land. To live here, to be part of the community, to contribute back, to be able to contribute to your local schools and your local jobs—all of these are the things that happen when you are invested in your community and your surroundings, when you are genuinely connected to what is going on around you, and you are willing to invest your money into your own community. So why, Government, would we not want to fight for that? I do not understand—well, perhaps I do, but I might not be able to share the language on that in this Chamber.

So why would we not want to fight for that—and at least know about it? Hey, at least, why would we not want to know what is going on with numbers? How about that, at least? For example, in Ōtara, and my colleague Jenny Salesa often points this out, sales of homes are now 80 percent to investors. This is up from 62 percent in 2010. We should at least be able to know very clearly who of those are not residents here in Aotearoa New Zealand. In Manurewa, where I live and rent my home, sales to investors are 68 percent. Bear in mind these two percentage points of sales to investors are higher than the country’s percentage rate of sales to investors. Again, we want to stick up for the communities that are being most hampered. We want to find out for those communities, my community and Jenny’s community, what is happening with sales there, at the very least. But mostly we do want to put a ban, which is why the Greens are supporting this amendment to this part of the bill. We do absolutely want to put a ban, and see how that goes. See how it impacts. At least do that.

I wanted to take just a short call, but one of the other points I wanted to raise is that for tangata whenua this has an even yuckier taste: when we are feeling on our whenua that we are tenants in our own whenua. Again, why would we not want to fight for that? Tangata whenua, our indigenous people, our mana motuhake people—why would we not want to fight to understand who is buying our homes and our lands, how we can find that out, and also to let us put up a ban? Let us see how this is going to impact on our country, because we do stand by our own residents, all of our own Aotearoa residents. Kia ora.

TODD BARCLAY (National—Clutha-Southland): I move, That the question be now put.

The CHAIRPERSON (Hon Trevor Mallard): The member might have got it if he had asked for it properly.

DENIS O’ROURKE (NZ First): A very good choice. I wanted to make some comments on what Chris Hipkins said because I think it is very important that we clarify this a little. The issue is with regard to proposed new section 17A(1)(c)(iii), to be inserted into the Overseas Investment Act by proposed new clause 15. That is the section that would allow overseas purchasers to purchase land if “the overseas investment will, or is likely to, increase the supply of housing in New Zealand, as determined by the relevant Minister …”. I do not think that the comments made by Chris Hipkins were realistic. He particularly referred to do-ups. I think those would be an excuse for overseas purchasers to buy valuable property, on the basis that they wanted to invest in them and make them more valuable. I do not accept that Kiwis could not do that just as well, or that there would not be a very long list of Kiwis wanting to do this, if only they could afford the property.

In addition to that, I think there is a lot of merit in simplicity. Proposed new section 17A(1)(c)(iii) and the whole of section 17B are far from simple, and would therefore create a wide opportunity for overseas purchasers to drive fleets of buses through this particular amendment. They would find ways through that of being able to purchase land in New Zealand without much restriction. The reason I say that is if you look at section 17B(1) you will see that “the relevant Ministers must determine whether the requirements [set out below] are fulfilled.” There may be some Ministers whom I would have faith in to do that well, and to do it genuinely. But I can tell you right now that if the current Minister were in that position, there is no way that I would have any confidence at all that the policies set out in section 17B would actually be followed with any genuine purpose whatsoever. So there is a huge problem with such wide ministerial discretion.

The second point is this. Look at section 17B(2)(a)(i), (ii), and (iii). In every one of those—in fact, in four places—the words “committed to” are used. What on earth does “committed to” actually mean? Nobody has said. Perhaps one of the Labour people could stand up and tell us, with precision, what they mean in each and every one of those four places where the words “committed to” are used. I do not think that is clear at all, and that is why I say that with this particular proposal a fleet of buses could be driven through it without notice. It is therefore going to compromise the whole piece of this proposal. That is a great shame, because New Zealand First desperately wants to stop overseas purchasers from buying New Zealand residential land.

That particular proposal, the one in section 17A(1)(c)(iii) that I read out, is the only one that compromises this otherwise very good proposal. I would very much encourage other members of the Committee to vote in favour of my amendment to the amendment, which would simply delete that. It would simply delete section 17A(1)(c)(iii) and, consequentially, the very complex and meaningless section 17B, and make this a piece of legislation that New Zealand First could support. It would then be a clean and simple and effective method of stopping overseas purchasers from buying New Zealand land, stopping the speculation that they indulge in, stopping the land banking, and stopping all the negatives that they do.

This is such a let-out that that particular provision really does have to be removed. I do not think Chris Hipkins was at all convincing in his attempt to justify it. I would again say that if people in this Chamber actually do want, in an effective way, to stop overseas purchases of New Zealand residential land, then please, remove that particular provision from this part. There is no good reason for it. It would achieve nothing, and the rest of it could then be effective, without being compromised in any way whatsoever.

JAMI-LEE ROSS (Junior Whip—National): I move, That the question be now put.

The CHAIRPERSON (Hon Trevor Mallard): In the last half an hour, I have not heard any new argument other than that from Mr O’Rourke. I think that members should be in a position now to be able to make up their minds on this.

A party vote was called for on the question, That the question be now put.

Ayes 63

New Zealand National 59; Māori Party 2; ACT New Zealand 1; United Future 1.

Noes 58

New Zealand Labour 32; Green Party 14; New Zealand First 12.

Motion agreed to.

The question was put that the following amendment in the name of Denis O’Rourke to the proposed amendment in the name of Phil Twyford to insert new Part 5 be agreed to:

Delete new section 17A(1)(c)(iii) and new section 17B from new clause 15.

A party vote was called for on the question, That the amendment to the amendment be agreed to.

Ayes 26

Green Party 14; New Zealand First 12.

Noes 95

New Zealand National 59; New Zealand Labour 32; Māori Party 2; ACT New Zealand 1; United Future 1.

Amendment to the amendment not agreed to.

The question was put that the following amendment in the name of Phil Twyford to insert new Part 5 be agreed to:

After Part 2 insert:

Part 5

Amendments to Overseas Investment Act 2005

11 Principal Act

This Part amends the Overseas Investment Act 2005.

12 Section 6 amended (Interpretation)

(1) In section 6(1), definition of category, after paragraph (a), insert:

(aa) an overseas investment in residential property:

(2) In section 6(1), definition of give effect to an overseas investment, paragraph (at), insert “overseas investment in residential property,”, after “overseas investment in sensitive land,”.

(3) In subsection 6(1), after the definition of overseas investment in fishing quota, insert:

“overseas investment in residential property has the meaning set out in section 12A”

(4) In section 6(1), definition of overseas investment transaction, insert “, an overseas investment in residential property,” after “overseas investment in sensitive land”.

(5) In section 6(1), after the definition of Reserve Bank, insert: “residential property means urban land that may be used to residential purposes under rules in the relevant proposed or operative district plan”

13 Section 10 amended (Consent required for overseas investments in sensitive New Zealand assets)

In section 10(1), after paragraph (a), insert:

(aa) an overseas investment in residential property (see section 12A):

14 New section 12A (What are overseas investments in residential property)

After section 12, insert:

12A What are overseas investments in residential property

An overseas investment in residential property is the acquisition by an overseas person, or an associate of an overseas person, of—

(a) an interest in residential property:

(b) rights or interests in securities of a person (A) if A owns or controls (directly or indirectly) an interest in residential property described in paragraph (a) and, as result of the acquisition,—

(i) the overseas person or the associate (either alone or together with its associates) has a 25% or more ownership or control interest in A; or

(ii) the overseas person or the associate (either alone or together with its associates) has an increase in an existing 25% or more ownership or control interest in A; or

(iii) A becomes an overseas person.”

15 New section 17A and 17B

After section 17, insert:

17A Criteria for approval of overseas investments in residential property

(i) The criteria for approval of an overseas investment in residential property are all of the following:

(a) the relevant overseas person is, or (if that person is not an individual) each individual with control of the relevant overseas person is, of good character:

(b) the relevant overseas person is not, or (if that person is not an individual) each individual with control of the relevant overseas person is not, an individual of a kind referred to in section 15 or 16 of the Immigration Act 2009 (which sections list certain persons not eligible for visas or entry permission under that Act):

(c) one of the following is met:

(i) the relevant overseas person is, or (if that person is not an individual) all the individuals with control of the relevant overseas person are, New Zealand citizens, ordinarily resident in New Zealand, or intending to reside in New Zealand indefinitely:

(ii) the relevant overseas person is, or (if that person is not an individual) all the individuals with control of the relevant overseas person are, intending to reside in New Zealand temporarily and in agreement with selling any interest obtained upon departure:

(iii) the overseas investment will, or is likely to, increase the supply of housing New Zealand, as determined by the relevant Minister under section 17B.

(2) See section 19 in relation to subsection (1)(a) and (b).

17B Assessing increase in housing supply for overseas investments in residential property

(1) If section 17A(1)(c)(iii) applies, the relevant Ministers must determine whether the requirements in subsection (2) are fulfilled.

(2) In order for an overseas investment in residential property to be deemed to, or deemed likely to increase the supply of housing in New Zealand, compliance with paragraphs (a) to (c) must be demonstrated:

(a) the relevant overseas person is committed to 1 of the following, in what the relevant Ministers consider to be a reasonable period of time:

(i) the overseas investment is in vacant land and the relevant overseas person is committed to building premises used or intended for occupation by any person as a place of residence:

(ii) the overseas investment is in existing premises used or intended for occupation by any person as a place of residence and the relevant overseas person is committed to redeveloping that site to contain a greater number of places of residence:

(iii) the overseas investment is an existing premises used or intended for occupation by any person as a place of residence that is not currently suitable for habitation and the relevant overseas person is committed to redeveloping that site to make it fit for habitation; and

(b) the relevant overseas person has, or (if that person is not an individual) the individuals with control of the relevant overseas person collectively have, business experience and acumen relevant to the investment in paragraph (a); and

(c) the relevant overseas person has demonstrated financial commitment to the investment in paragraph (a).

16 Section 19 amended (Applying good character and Immigration Act 2009 criteria)

(1) In section 19(1), after “sections 16 (1)(c)”, insert “, 17A(1)(a)”.

(2) In section 19(2), after “sections 16(1)(d)”, insert “, 17A(1)(b)”.

17 Section 24 amended (Who decides application)

After section 24(1)(a), insert:

(aa) in the case of the residential property decision, by the Minister and the Minister of Housing:

18 Section 28 amended (Conditions of consent)

After section 28(2), insert:

(3) Where the overseas person is intending to reside in New Zealand indefinitely as set out in section 17A(1)(c)(i), the Minister must impose as a condition of the consent that the overseas person become a resident of New Zealand within a period of time to be specified by the Minister.

19 Section 61 amended (Regulations)

After section 61(1)(m), insert:

(ma) providing for applicants from particular countries to be exempt from this Act for overseas investments in residential property:

A party vote was called for on the question, That the amendment be agreed to.

Ayes 48

New Zealand Labour 32; Green Party 14; Māori Party 2.

Noes 73

New Zealand National 59; New Zealand First 12; ACT New Zealand 1; United Future 1.

Amendment not agreed to.

New Part 6 Amendment to Resource Management Act 1991

PHIL TWYFORD (Labour—Te Atatū): I am speaking to proposed Part 6, which mandates that the Minister must, within 6 months of the commencement of this part, prepare a new national policy statement under the Resource Management Act (RMA) on urban growth. This is very important because if there is a root cause of the current housing crisis that bedevils New Zealand, that root cause lies in the highly restrictive planning regime and the way that we finance infrastructure, which has the effect of choking off the supply of new land for development. It drives up urban land costs and triggers a chain reaction of speculation and land banking that has seen our largest city now have some of the most unaffordable housing in the Western World.

This amendment in the name of the Hon David Parker sets out an alternative, smarter approach to managing urban growth, which we believe goes right to the heart of the root causes of the dysfunctional urban land markets that are at the heart of the problem that we have with our housing in New Zealand. What happens is that the planning rules choke off the supply of new land. They create an artificial scarcity of land and they drive up the cost of urban land that is able to be developed. That acts as a magnet for land bankers and speculators, who rush in. They buy land around the urban growth boundary in the knowledge that in time that boundary will shift and the value of that land will go up. By the very nature of having a boundary like that, with urban land on one side and future urban land on the other, you get this massive differential in land values—sometimes up to 10 times. Urban land that is able to be developed can be up to 10 times the cost of rural land on the other side of the boundary. That differential is an irresistible magnet for speculators.

What we have seen in Auckland over the last 20 years is land bankers pocketing windfall gains of thousands of percent. There are thousands of percent of windfall gains for land bankers who have just bought up paddocks in the knowledge that they will surely, eventually, be rezoned for urban development as the city expands. Who pays that cost? It is future homeowners, because the cost of that land banking—the inflation of land values—just simply gets loaded into the price tag of new homes in new developments. It drives up the price of housing, it makes housing less affordable for first-home buyers in particular, but, most importantly, the marginal cost of land on the fringes of the city gets capitalised into property values right across the market. So it has an extraordinary inflationary impact on house prices across the entire market. We could hardly design a system that was worse at protecting affordable housing.

The lesson, I think, from the last 20 years in New Zealand is that we must make room for growth. Auckland is expecting another million people to call that city home in the next 30-odd years. If we do not make room for that growth, if we put in place restrictive rules that stop the city growing up and stop it growing out, only one thing will happen: we will drive prices up and we will deny our children and our grandchildren the opportunity to ever own their own homes in the city. What David Parker’s amendment does is it proposes a whole new alternative and a smarter way to manage growth. If we look at proposed clause 12(2)(a), it proposes a national policy statement on urban growth that must include a prohibition on the use of urban growth boundaries within a district plan where official statistics predict there will be population growth.

But it is not enough just to do away with the boundary; we must do other things. We must, for example—as we say in proposed clause 12(2)(b)—use more intensive spatial planning to set out over space and time what should happen, what developments should be allowed to happen in the identified growth corridors. We must acquire land for transport and other infrastructure corridors and networks. We must, for example, set aside areas of special value—environmental or cultural value—that are not appropriate for development. Most importantly, we must deal with infrastructure and utility costs, which add massive expense to new developments, and we must ensure that those costs are properly internalised in new developments.

What we are proposing here is a rigorous system for ensuring that the costs of that infrastructure are properly internalised so that the taxpayer and the ratepayer are not being asked to subsidise development in places where it might be extremely expensive to lay down that infrastructure—where it is uneconomic. Those are a few of the key principles in this amendment, which we believe is a much more permissive approach that will stop the planning regime choking off new land for development and driving up the cost of urban land. We believe that this policy will be one of the most essential reforms that we can make if we want to produce a more functional and more competitive urban land market.

I want to contrast this approach with the special housing areas and the track record of this Government in the last 8 years. Bill English and Nick Smith have spent a decade talking about this issue—blaming the RMA, blaming councils for restrictive planning rules that have driven up the cost of urban land—but they have done so little about it. You can barely credit the inconsistency, the gap, between the rhetoric and the reality of National on this issue over its last 8 years in Government. It has spent all of its time scapegoating councils and blaming the RMA, when it has done virtually nothing to tackle the root causes of the problem, which are the restrictive planning rules that stop the city growing up and growing out. Finally, what we have seen is Auckland Council, actually, which deserves credit for adopting a unitary plan that significantly up-zones the city and allows more density so that a better mix of housing options, hopefully with some better affordability, can be built in the city—and it has increased the amount of greenfield land available, to take out some of the extreme price pressures caused by the lack of new land for development.

But that is only an incremental step; what we need is a whole new approach, which is embodied in David Parker’s amendment. It would be a smarter approach to protecting the environment and to supporting the development of good urban form. I want to reassure people who are concerned that this might lead to unchecked sprawl that it is not designed to do that. We are advocating the freeing up of density in the city to allow more density to happen. The crucial factor here is that the costs of new development are properly internalised. That will tilt the playing field in favour of intensification in the city. That will take advantage of the sunk infrastructure assets that are already there. We are going to debate, later on, a new mechanism for financing infrastructure: infrastructure bonds that will be paid back over the lifetime of the asset through a targeted rate on the properties in a new development. You put those two factors together and you have got a whole new way of managing urban growth that will cut out the rotten heart of our planning system, which currently drives up urban land prices and acts as a magnet for speculators.

You could not get anything more different than this bold, courageous new approach to managing growth in contrast to the incremental, piecemeal tinkering of Nick Smith’s special housing areas, which have made virtually no difference to the supply of housing and certainly no difference to affordability.

JULIE ANNE GENTER (Green): I have a slightly different perspective on the situation than the previous speaker, Phil Twyford. The Green Party will be supporting this amendment on the condition that there are several amendments to it. My slightly different perspective is that there is a story around development in New Zealand, particularly in Auckland, that says that people want to live on a quarter-acre section, they want to be able to drive everywhere, and we need to build motorways to assist that.

The reality is that there is no point building a whole lot of cheaper houses and places for people to live unless people have affordable access to jobs, schools, shops, green spaces, and amenities. People do not need just houses, and that has been the whole failure of this special housing area approach. It is entirely focused on houses, not on neighbourhoods, which is what people need to live good lives.

We will completely undermine the objective of making housing affordable if we do it in a way that makes transport far more expensive. So we can support this amendment on the basis that it is not going to result in urban sprawl because of the many subsections that do not just stop urban growth boundaries but actually require local authorities to take a much more proactive, detailed spatial planning process that sets aside land that is of special value. It might be a value for a community to have land that is used for agricultural purposes close to the city, to have land that is preserved for biodiversity purposes, and to ensure that all of the new development is around infrastructure corridors that provide good transport linkages to other parts of the community.

It is not just any transport corridors, because the other thing that is missing, I think, from this amendment is the recognition that climate change is an urgent, urgent challenge for everyone on this planet, and we have to be thinking and creating communities where people can get around without increasing dangerous climate pollution. It is not affordable and it is also not wise to be planning for car-dependent, sprawling neighbourhoods that cost people a fortune, segregate communities, mean it is harder for them to access jobs, and, on top of it all, we have got this warming climate, we have got a pressing need, and an opportunity to create vibrant, livable communities that are linked up by smart, clean public transport that means people can socialise, work, and relax while getting around the city. They do not have to spend hours stuck in traffic, and they do not have to spend a whole heap of their income on ever more cars just so their kids can access schools and jobs.

So the Green Party can support a smarter approach to planning that is going to achieve not only affordable housing but affordable transport and access to the things that people need to live a good life. That takes a proactive local government approach, and that is what has been lacking under this National Government, because it is so ideological and it is so—as my colleague Marama Davidson says—disconnected. It is thinking about things in a very siloed way. We have got this focus, supposedly, on affordable housing. Well, (1) we are not even going to achieve that with special housing areas, but (2) what good is cheap housing if you have expensive transport, and what good is cheap housing if you cannot access jobs? It is not going to solve the problem.

So the amendments I plan to table will amend the proposed part so that it prohibits the use of planning rules that are currently used, like minimum parking requirements, which are actually pushing development out from the centre. Where people actually want to live is in the existing urban area, because that is where one has access to jobs, access to communities, and access to schools and hospitals—everything that they need. That has not happened, because planning rules actually make it more difficult and more expensive to provide homes in the existing urban area.

If we did not have all those rules, we would not need urban growth boundaries, but the reality is that we have all those rules, and so we also have urban growth boundaries, and so there is pressure from both sides. I would prefer to leave the urban growth boundaries in place until we have sufficient development within the existing area, but I can see that if every part of this proposal in Part 6 was included, including the detailed spatial planning, setting aside areas of special value, ensuring that future infrastructure corridors and networks—[Bell rung] But if we have new communities sprouting up in places like Warkworth or in between Pukekohe and Auckland, they have to be around the rail network and there has to be electrified passenger transport services.

Those communities in greenfields could be within walking distance of electrified rail networks, and they could have schools, parks, and amenities—everything that people need. But if we are going to go down the route of a paddock subdivided into a bunch of McMansions with no schools, no amenities, no shops, and everybody having to get on the motorway and into a queue of cars to get anywhere, that is not going to be the solution that New Zealanders want, is it?

New Zealanders want affordable housing, they want affordable transport, and they want to do their bit. They do not want to be adding climate pollution to the atmosphere, and they need the Government to be proactively investing in the infrastructure—that is, the transport, the water management, and the housing itself. They need the Government to be leading on that infrastructure investment in a way that enables them to live good lives, to reduce our energy use and our pollution use, and to create happier, healthier communities, because that is the opportunity we have.

We have done things pretty poorly for the last 50 years, but we can see in communities overseas that have a much more integrated approach to planning and have a much more proactive investment strategy around public transport—it works well, and people love it. They love living in those places. You can have affordable housing, affordable transport, and respond to climate change, and have vibrant, thriving, green communities. It is fantastic. It is just sad that the current Government does not seize this opportunity to create far more livable neighbourhoods for New Zealanders.

So on the amendments that I want to propose—one is that we prohibit the planning rules that are preventing more homes and neighbourhoods from being built in the existing urban area, as well as prohibiting urban growth boundaries, and we need to have a requirement, as well. In new section 46C(2)(b) we have got this “requirement for local authorities to undertake detailed spatial planning …”, and in that requirement they need to take into account climate change. There is no point doing this planning around long-term projects like affordable housing and affordable communities if we are not taking into account the urgent need to respond to the long-term challenge of climate change. That needs to be at the forefront of our thinking of the way our cities and towns develop in the future. It has to be.

So I will table a proposed amendment shortly that will mean that local authorities, in undertaking their detailed spatial planning, will take into account the need to mitigate and adapt to climate change, which I think is fair enough, and I am sure the Labour Party will be supportive of that. Thank you very much.

Hon DAVID PARKER (Labour): I rise to speak in support of the proposed amendment in my name that adds new Part 6 to this bill. Can I make the point that this prolonged debate of all of these other necessary measures that would be important to solve the housing crisis—every one of which National is voting against—is being protracted only because the Government, under urgency, pushed through Part 2 of this bill, which takes away, without select committee consideration, the property rights of people who have a residual interest in a property that was compulsorily acquired by the Crown. The Government, having said that that is already the law, is passing a law to take it away—obviously it is hard to believe that that is already the law if that is what it is doing. If it had not been for that, the Government could be progressing with other business. If it wants to still refer that to select committee and put that through a decent process, its members should come and talk to us.

This part of the bill is a very important part of the Labour Party’s policies to reduce the cost of new housing, which, as my colleague Phil Twyford points out, flows through to the cost of all other housing. As we know, markets clear at the marginal cost of the new. If there is a shortage, if the marginal cost of the new is higher than it would otherwise be, it not only lifts the cost of the new but flows through to all of the alternative purchases, which are the cost of the old. So if you have excessive land costs and excessive capital infrastructure costs up front in a new subdivision, then that flows to the cost of all housing in a place where you have got urban population growth—as we have in Auckland.

Perhaps the thought leader on this in the world, or one of them, is Professor Ed Glaeser from Harvard University. He was brought out by the University of Auckland business school a couple of years ago to address New Zealand on what you need to do to have good cities that service the needs of the population, particularly in growing cities. He is the author of a book called Triumph of the City. I went to his lecture in Auckland, and he made three important points.

Before I turn to that, I would make the point that it is absurd that in a country that has as much land as New Zealand—and as few people—that we have amongst the most expensive land, or land inflation, in the world. It is a truism. We have got a land area that is the size of the United Kingdom, about the size of Italy. We have got less than a tenth of their population, and yet we are the ones that have got problems with house prices and land inflation. It is not because we are short of land; it is because the Government’s settings are wrong, including around the planning of the release of land. You hear defenders of urban growth limits say: “Well, there’s a lot of land planned for release.” In fact, Auckland City, in its own defence, says that it is rezoning an area the size of Hamilton, and, therefore, all of these problems will be cured. The problem is that, actually, it releases that extra land zoned in tiny little increments, so as to drive, from its point of view, the efficient use of infrastructure. In the process, those releases are always captured by land bankers, because land bankers know where they are going next—the 10-year long-term council plan shows where the infrastructure is going in next. So, around the margins of that growth, the price of land is held high because the market is never fully supplied with land in the face of the shortage that we have had for some years.

So Glaeser says two things—well, actually, he says three things that I think are really important in this debate. First of all, he says that urban growth boundaries are inappropriate because they constrain supply in the face of population growth and drive up prices. Secondly, he says that rules that limit the natural intensification that will occur within an existing city are even worse, because they drive up prices and they stop people from doing what they naturally want to do—which is that as populations grow, they actually want to live in reasonably compact cities. Thirdly, he says that you have to be very, very, very careful that you do not transfer the cost of infrastructure inappropriately, either to existing ratepayers, as a future ratepayer to them, or—also, one of the other reasons you do not want to do that is that you distort the price signals across the whole of your country, and you actually ruin the regional development of other places, which should be gaining an advantage. If prices are on the rise in a city like Auckland, you would expect that other cities and other regions would be developed as a substitute for some of that more expensive development in Auckland. You do not get that right if you do not get the pricing of infrastructure right.

What this requires is that a national policy statement be drafted by the Minister for the Environment, under the Resource Management Act (RMA), within 6 months of the proposed new section 46C coming into effect. That national policy statement would then go through the normal processes under the RMA and would, effectively, impose rules upon district and regional councils that stop these practices that, at the moment, are driving up land prices and, therefore, house prices.

The Labour Party has been pointing out that this is necessary for about 3 years. Our response has become increasingly sophisticated in the last couple of years through Phil Twyford’s efforts, and other people’s—and I hope I have made a contribution there. But it actually goes back to when Annette King was our housing spokesperson and David Shearer was our leader, when we first said that we actually needed a national policy statement in respect of affordable housing under the RMA. As my colleague Phil Twyford has pointed out, for years we have had National bleating on that the RMA is the cause of these problems. Actually, in truth, if used properly, the RMA is the solution to these problems, because national policy statements are provided for under the RMA and should be used when there is an issue of national importance—such as a housing shortage—that needs to be overcome through changes to planning rules, which the Government has always had the ability to do through a national policy statement under the RMA.

I want to deal with the point that Julie Anne Genter raised, because it is a very important point. She makes the point that you have got to be careful that you do not drive inappropriate forms of urban form that increase pollution, waste infrastructure, cause people to sit in cars longer, increase the cost of public transport because you have got to extend public transport networks, or increase the operating costs of public transport because they are less efficiently used. That is the purpose of these paragraphs (c), (d), and (e) of proposed new section 46C(2) of the RMA, under this amendment.

It says that central government should list all of the infrastructure costs—that includes libraries and swimming pools, the extensions to public transport, the extensions to local roads, and the inefficient use of central government motorways—all of these things should be properly measured. You will not recover the cost of all of them, but you should be properly measuring the marginal cost of growth, so that you can make a rational decision. Then, you should have some standard rules that work across the country as to how you allocate those costs. That is how you get the right economic signal to drive appropriate urban form without allowing the land bankers to capture the land market and drive land prices to the ridiculous levels that we have in New Zealand, where, despite being a country that is so rich in terms of our land area, we have this incredibly high land inflation.

The Labour Party was on to this before National. We were on to it before the Productivity Commission started to think of it. We are, in many ways, more considered in our use of markets than is the Government. The Government claims that it knows how to work markets. These are rules-based markets. The rules are in district plans. If the market is not working, you need to change the rules. It is that simple. But the National Government does not understand that in order to use and harness the private sector and the public sector to solve this housing crisis that we have in New Zealand, we have to harness those markets through appropriate rules relating to the urban limit. That is what this tabled amendment in my name does. We have artificial land scarcity in New Zealand. We all know that we have got a lot of land; it is just that people are not allowed to build on it. Blaming the RMA has always been wrong; the RMA is where the solution lies.

DENIS O’ROURKE (NZ First): New Zealand First will support Part 6, as proposed by Labour Party member David Parker. It does pre-empt, in fact, parts of the Resource Legislation Amendment Bill, which is currently going through the process. But our support is worth some caution, I would have to say, because fixed boundaries have worked, in fact, in most parts of New Zealand quite effectively—Christchurch is one of those. But I accept that Christchurch, with its huge areas of land adjacent to it, is rather different from Auckland, which is built on an isthmus and has a much greater rate of growth. So, bearing that in mind, I think it is quite appropriate at this stage that we do accept that some change is necessary in places such as Auckland to make the use of fixed boundaries no longer appropriate, and to look for an alternative.

I think the alternative we have here is certainly one that we can consider supporting. It is a shame that this proposal is not actually going through a full select committee process, because this, like other provisions in the bill itself, really does need proper examination. It is a shame that that is not happening, but we do not have the luxury of that. Here we are in urgency. Here we are, having to look at Part 6.

On balance, New Zealand First will support Part 6 subject to the Greens’ amendments, which I think are satisfactory, and on the basis of the alternative to fixed boundaries that is set out in new section 46C(2)(b) in particular, but also in paragraphs (c), (d), (e), and (f). The crux is paragraph (b), which actually says: “a requirement for local authorities to undertake detailed spatial planning which sets aside areas of special value, and sets out future infrastructure corridors and networks as an alternative to urban boundaries”. The other paragraphs everyone can read for themselves.

The point that I want to make is this: the Resource Legislation Amendment Bill has drawn a large number of submissions in support of spatial planning, and it does seem to me and to many people that that is the way to go in the future, especially for Auckland. It is a much more sophisticated approach to planning, especially in high-growth areas. But, most of all, New Zealand First is very supportive of the parts of this particular section, and that is new section 46C(2)—all paragraphs of that—where it refers to infrastructure corridors and networks as a tool to prevent growth into inappropriate areas, especially those areas where delivery of infrastructure would be far too expensive, impracticable, or too remote from transport opportunities. That is the point of Julie Anne Genter’s amendments, so that is why we particularly support those.

I would have to add this: in my 15 years on the Christchurch City Council, on more than one occasion I actually tried to use the limitation of the expansion of infrastructure as a way to discourage inappropriate growth, but, of course, it was illegal to do so, so my attempts largely failed. I have to say that some of the areas where that growth happened were areas that have now been red zoned—areas that should never have been developed on at all. Megan Woods, nodding her head, is quite right—we all know where those areas were, and we all know that that development should not have happened. If we had had this regime at that time, it would have been possible to avoid it.

Finally, Julie Anne Genter was quite right when she referred to the need for development to take adequate notice of transport issues. In fact, New Zealand First policy is to favour transport-led development. You can see that in many parts of the world, so it is not a wheel that we have to reinvent. There should at least be adequate notice taken of transport issues when developments are approved. That is not happening currently. So with those qualifications, New Zealand First will be happy to support Part 6.

Dr MEGAN WOODS (Labour—Wigram): I am happy to take a call on new Part 6. But I would like to point out, as I am taking a call on new Part 6, that this could have all stopped at Part 2 if the Government had agreed to split this bill in two and send it to a select committee, where Part 2 could have had the proper consideration that it required.

In my 5 years in this Parliament, I have not seen a simple piece of legislation drafted as badly as this legislation, or handled so badly that it sees us still here, in about the 14th hour of this debate, debating Part 6 of this legislation. It is in the power of the Government’s hands to change that, and I put that challenge to the Government members. If you want this to be over, split the bill in two and send the provision that undermines private property rights—or that could undermine private property rights—to a select committee and let it have its due consideration.

Under this new Part 6, I do want to talk specifically about the amendment put forward by David Parker in terms of the national policy statement, or the NPS, which is, of course, an instrument under the Resource Management Act that the courts have found to be a particularly powerful instrument in the hierarchy in terms of how it is considered. It has a great deal of regulatory power in terms of setting the agenda, and it is an instrument that could have a great deal of influence over how our cities are planned in the future. Of course, this is something that the Minister for Building and Housing, Nick Smith, has been talking about for quite some time, and when the draft of that NPS was released back in June this year, my colleague Phil Twyford eloquently described it as a damp squib—he had had the opportunity to actually do something with an instrument as powerful as a national policy statement but, in typical style, it did nothing. It did not do the things that we are setting out in this amendment in David Parker’s name.

I want to talk specifically to new clause 12, which inserts a new section 46C into the Resource Management Act, and I want to talk specifically to new section 46C(2)(b). This is the clause that Julie Anne Genter is offering her amendments to. It says: “A requirement for local authorities to undertake detailed spatial planning which sets aside areas of special value and sets out future infrastructure corridors and networks as an alternative to urban boundaries;”. She is proposing that we include climate change in there, and that is certainly something that the Labour Party can support.

One of the key considerations that we have to make when planning the future of our cities is rising sea levels and storm surge. Mr O’Rourke talked in his speech about infrastructural investment and the development of suburbs in Christchurch that have ended up in the residential red zone when we could have predicted the outcome for those communities—well, likewise, when we are facing the issue of sea level rise. We know the areas of New Zealand and the areas of our cities that are under threat, and we have the ability, through a national policy statement, to plan appropriately for those—to put in place the proper infrastructural planning that has to happen. This offers us an opportunity to be progressive, to think ahead, and to plan in a 21st century way—not with our heads literally in the sand and not taking account of the future.

Taking account of climate change in city planning is absolutely critical. One of the largest meetings at the Paris convention on climate—at COP-21—was actually a meeting of mayors of cities, with people discussing issues relating to cities and how they are going to both adapt to and mitigate the effects of climate change. Of course, the Compact of Mayors, which now includes 526 cities globally, accounting for 438 million people, or 6 percent of the global population, is an organisation that was set up by Ban Ki-moon, and it now has a special envoy in Michael Bloomberg. This is an organisation that is sketching out what progressive cities are doing in their efforts to both adapt to—

Todd Barclay: Any advice for Gore?

Dr MEGAN WOODS: —and mitigate the effects of climate change. I see the current member for Clutha-Southland—

METIRIA TUREI (Co-Leader—Green): I want to echo the comments of my colleague Megan Woods. The Parliamentary Commissioner for the Environment has made it very clear that planning for climate change and for the infrastructure costs and changes that are needed is absolutely critical for large parts of New Zealand’s urban and coastal areas, including the city where I live—Dunedin. South Dunedin is at particular risk of sea level rise and there are particular infrastructure issues that arise from it being an old city with old infrastructure. So there needs to be careful measured planning and the authority to do that planning, the ability to communicate that, and then the ability to change the rules when it is needed in order to be able to prepare for the sea level rise that is expected and that is already, in our case, affecting large parts of South Dunedin. I look forward to the amendments from my colleague Julie Anne Genter, who is including climate change into new Part 6, which is proposed by Labour. The Green Party will be supporting Part 6 and we look forward to support for the amendments that we are making to Part 6.

Beyond the climate change aspects that need to be considered, I did just want to take it back to a kind of human level—a street-level approach, if you like. One of the reasons why I am quite supportive of new Part 6, despite the concerns around the urban growth boundaries, is that the rest of this part sets out a new kind of way of looking at planning, and that is essential not just for those areas that might be affected by climate change but, actually, for the reimagining of our cities and towns as places where people love to live.

All of the things that people need the most—access to decent homes; affordable transport to green space where they can enjoy their communities together; those social community spaces where it is safe because there are lots of people around and lots of different kinds of people around, and where there are great pedestrian and safe cycling opportunities for families to get to work and to school, and to enjoy for recreation—come out of a proper infrastructure system, which is being proposed here in new Part 6, and proper urban design that allows for people to come together and design their cities the way that they want them to be.

So I want to encourage members and members of the public to have a look at the Green Party proposal for reimagining our cities—the Greens’ cities proposal, which we released a month or so ago. That proposal asked for feedback from the public, from New Zealanders, and from people involved in the industry about two things: one is the building code, and we dealt with some of that in the debate on proposed new Part 4; and the other is a national policy statement on urban design. That is what sits on top of the infrastructure and planning tools that are set out in new Part 6.

So we pass Part 6, we get those planning tools right, and then, on top of that, we design and build the cities and the communities that we know that people want to live in. That includes things like the street design to make it comfortable for people to move around easily from place to place—from home to shop, to school, to after-school events, to the theatres, and to work and back. It is designed around women and children, which is a new approach to urban design where the needs of women and children feature at the centre of urban design. This is because, actually, the research shows that women travel more as a result of their daily requirements of activities: getting their kids to school, often doing all of the shopping, and getting to work and managing the after-school care. Women’s travel and city requirements, if you like, are much more complex than men’s, it turns out in the research, so let us have urban design that focuses on the needs of women and children to keep them safe and enable them to use their city in the best way possible.

Let us make sure that urban design promotes child and pedestrian-friendly environments so that we can reduce the risk to children and to pedestrians—but particularly children who are walking to and from school—from the hazards of roadways and driveways where so many accidents occur. There are really good opportunities here for community spaces that help to build collaboration and connection between communities rather than the isolation that many older New Zealanders, especially, are starting to face. As older New Zealanders are facing more and more financial pressure, they are also increasingly isolated from their communities and finding it more and more difficult to connect to the people who—

Dr DAVID CLARK (Labour—Dunedin North): Markets make excellent servants and terrible masters. I want to say that why I support this amendment so strongly is that it is a way of ensuring that the market works in support of human aspirations, and in terms of creating a livable environment for New Zealanders.

Hon David Parker: An affordable one.

Dr DAVID CLARK: An affordable one, most importantly. That is, I think, also why the Government’s approach can be described as so mistaken in opposing this change. I think the Government is opposed to any kind of planning. That is something that we fundamentally see over and over and over again from this Government—an approach opposing any kind of planning. I think it is on the mistaken understanding that business in New Zealand will not cope with change. When I talk to business people they tell me not that they do not want change but that they want a clear sense of direction of change. They want some certainty around what the future rules will be and what the future environment in which they will operate will look like. I think the same is true of people generally. We do not like change for change’s sake but we do like to think that we would live in the optimal environment and have affordable housing in New Zealand.

We in New Zealand do have some challenges. In Helsinki, which is one of the great livable cities, in my view, the city council owns 65 percent of the land. When you own 65 percent of the land, urban planning is pretty easy. It becomes a very simple thing to do. In New Zealand it is not true that the Auckland Council owns 65 percent of the land, so we have a different proposition that we deal with here. What we do need to do is make sure that when we do have changes in terms of the urban boundary and so on, there is real planning around what happens so that we get the best value for New Zealand citizens.

In this policy, which is represented in the amendment in David Parker’s name that is before the Committee, we are hoping that we will create an environment where there is more planning. The national policy statement on urban growth that is proposed in new section 46C(2) set out in clause 12 of new Part 6, must contain: “(a) A prohibition on the use of urban boundaries within a regional district plan where official statistics predict there will population growth;”, which suggests a way of doing planning that looks to where the growth is going to be, and it makes sensible planning around it so that business and people and everybody can have an environment where we know what change is coming. What it will also do is give councils the opportunity to purchase land for future development at rural prices, rather than having to buy off speculators and land bankers who have seen the changes ahead, who have bought up the land, and who then sell on to councils and other developers at extraordinary prices because they are making use of a system that is broken and that does not serve the citizenry properly but, rather, is tilted in favour of those land bankers and speculators in our housing market.

It is not enough, in my view, for the council to progressively add more zoned land for development here and there on an ad hoc basis. That simply feeds the speculation that is out there already and it is—that speculation—the inevitable result of the existing status quo system for setting the boundaries. We need integrated transport and infrastructure planning and this particular change permits that to happen in a way that is good for the citizenry. It makes sure we have affordable new infrastructure, affordable housing, and livable cities in New Zealand. If New Zealand is going to be the kind of country that prospers in the future, it has to be a place where talent wants to live. It has to be a place where talent can afford to live. So when we are talking about attracting overseas people with talents here, when we have our own skills shortages to meet—we want to train New Zealand people but we also want to attract people—rather than presenting them with the most unaffordable housing market in the world, where people overseas cannot even imagine coming to live in our biggest city, this change that is proposed in this bill is one that I wholeheartedly support.

I congratulate David Parker on putting this amendment forward. It is one that will make a real difference for our biggest city and could, too, I would suggest, make a difference to other cities around New Zealand.

Dr Megan Woods: Like Dunedin.

Dr DAVID CLARK: Well, Dunedin—I would like to talk about Dunedin. I would also like to talk about Queenstown. In Dunedin we have some serious infrastructure challenges born of a city that has been there obviously for some time.

JAMI-LEE ROSS (Junior Whip—National): I move, That the question be now put.

CATHERINE DELAHUNTY (Green): Tēnā koutou e Te Whare. I really welcome the opportunity to support the proposed new Part 6 and also the amendment that Julie Anne Genter is proposing to this amendment, because what is great about this debate is it is an actual opportunity to talk about great things, not only about how terrible and useless the Government is, which is a bit of a given, but to actually talk about something awesome, which is that we have got ideas for designing things better.

I think the first thing that we are talking about is the need for a plan, and what I like about both these amendments is the idea of a national policy statement on urban growth or, even better, on urban design. Why is that so important? It is so important because we already have an infrastructure mess and growth problems right across not just Auckland, which has had a lot of focus, but also many of the rural communities, the small towns, and my particular passion—which is odd and not shared by everybody—which is sewerage. It is an interesting passion, but it is very relevant to urban growth because if we do not handle that stuff properly and we shove a whole lot more houses into special housing areas where the infrastructure is not designed to take it, we are going to get a bit of a mess.

So the other week I was in the leafy suburb of Herne Bay, being lobbied by some people who were saying that the special housing area was going to put enormous strain on the infrastructure in that area. They were very concerned about urban growth, these people, because they have got raw sewage running down their road every time there is heavy rain. That is a really interesting example of what happens when you propose more housing, badly planned—without a plan, actually—just because it sounds like a good idea to make somewhere a special housing area and shove 70 homes into a small space, when already Cox’s Bay is so contaminated that wading is a joke, let alone swimming. It is a pretty sad situation for a beautiful spot like Cox’s Bay, which is in the middle of the Grey Lynn - Point Chevalier - Herne Bay area, right in the city where people want to have fun and want to play.

So although we welcome this, we really want to see some detailed planning, because there is the issue of sewerage, my particular passion, because if we cannot fix that up—we can put people on the moon, but we still cannot deal with our own waste—that is primitive. Allowing raw sewage to run into the sea is primitive, and allowing our streets in our bigger cities to run with raw sewage during heavy rain is primitive. That is about bad urban planning. That is about exhausting your pipes and resources.

But there is also the issue that Julie Anne Genter brings up, which is climate change. So climate change is not going to happen just to Auckland and Dunedin and Christchurch, where I can see the largest number of people could be displaced, but I live in the town of Thames, where it is estimated that quite a lot of our low land will go under water. What we need out of Government housing strategies and infrastructure planning strategies is leadership to encourage local government and regional government to take this seriously, but if we keep pretending that climate change is not really happening and that we do not have a role in the leadership of good housing planning, good design, and good urban design, we are never going to get there when the crisis hits.

We will all be staggering around like we are now. Housing crisis, the Government does not get it, everyone is dabbling around, people living in cars, shameful nation mentioned in The Guardian, total disaster—add to all that climate change. So it is going to be people living in cars, driving underwater, nowhere to sleep, water is going crazy, urban design is not happening, the Government does not know what to do.

Fortunately, we are going to change the Government. We are going to inherit the mess but we are going to start doing something about it, and that is what Part 6 and the amendments we are proposing are about. It is about doing something about it and thinking ahead, because our cities and our small towns all need urban design.

If Julie Anne Genter was here she would be saying: “And it’s about parking rules.” She is an expert on parking rules, which is an area that I fear to tread in because I think you need to understand parking a lot more than I do, but I really get why she has put up this amendment for spatial design to accompany—if you are going to set up urban limits and boundaries, there has to be an alternative view that creates a spatial planning design strategy that makes sense.

So all of this is about common sense. All of this is about saying the Government has a role, so in many ways this whole debate, including this part, is about the role of the State—about whether the State actually has a role or whether it is a hands-off, chaotic, “Let the sewage run raw in the street. Let the sea-level rise come over the low land. Let’s just everybody build a house.”

Hon DAVID PARKER (Labour): I want to emphasise something that I do not think has been well covered in this debate so far. One of the problems that we have around Auckland is that the cost of extending both central government and local government infrastructure runs into many tens, if not hundreds, of millions of dollars extra every year than it would if we had appropriate planning for growth.

I have already conceded the point, and made clear in this amendment, that we need to be very careful not to inefficiently use existing infrastructure, and to make sure that the pricing decision encourages the most efficient use of existing infrastructure within urban boundaries and the most efficient use of new infrastructure outside what are the existing urban development boundaries, which we say should not exist.

But this other point that I am making is what is the cost of transport corridors, which are, in the main, rail corridors, public transport, bus lanes, local roads, and State highways? All of these things should be purchased well in advance, or designated well in advance—and I think generally, in a city that is growing, they should be purchased well in advance—while they can be purchased for rural land prices. No unfairness to the rural property owner—they get fully compensated. If you are going to form new regional parks, you purchase them for rural land prices, rather than for 10 times that amount once the land bankers get it, and the value is driven up as the date for future subdivision gets ever closer, because there has not been enough planning in advance.

The second point I wanted to emphasise is that in order to stop the inefficient use of infrastructure—oh, sorry. How that flows through to cost, of course, is that if those huge costs are passed on in development levies, which are higher than they would otherwise need to be, that then translates through to the price of all housing—not just the new housing but the existing housing, which is lifted by the rise in price of the marginal cost of the new, which is how markets clear—but it also drives up the cost of central government taxes and future rates because not all of those costs are put to the subdivision.

In order to achieve efficient use, and you do need to internalise those costs of the new development—I did not develop this point when I first spoke, but one of the things that happens when city costs go up too high is it actually becomes more competitive for other cities to compete with them. So, rather than actually throwing more fuel on an overheated property market, if you get these cost signals right you actually get regional development in other parts of the country, and that is what should happen.

We are, as a country, over-dependent on Auckland. You know, we have a greater weighting towards one centre of population—which is Auckland—than virtually any other developed country in the world has, except the small city States like Singapore or Hong Kong, which are virtually only a city. Otherwise, there are only one or two other countries in the world—Ireland, with Dublin, being one of them—that are as weighted towards one centre of population as we are, and it becomes inefficient. It becomes unfair to other parts of the country because you create this vortex that, just by virtue of size rather than efficiency, sucks in other businesses.

So, for example, if you are a potato chip manufacturer based in Dunedin, you eventually relocate to Auckland because of the transport costs because of the relative size of Auckland, rather than because of any natural advantage to the production of potato chips in Auckland.

Hon Dr Jonathan Coleman: Just like the member himself.

Hon DAVID PARKER: “Just like the member”—oh, thank you. Well, I sort of have a foot in both camps still. Both are very good places, to which I am attached.

So those economic development things are very important. When you get these things wrong and you get house prices out of control, like they are in Auckland, you actually see the movement of New Zealand - born people. There are very few people in New Zealand, and, indeed, in Auckland, who know we have had net migration, for a long period now, out of Auckland of New Zealand - born Aucklanders. There are more people who were born in New Zealand who are leaving Auckland than are going to it. That is even taking into account the effect of Christchurch, which, of course, led to a lot of people initially moving from Christchurch. Even with those statistics in the latest census, we had net population of New Zealand - born—

JAMI-LEE ROSS (Junior Whip—National): I move, That the question be now put.

The CHAIRPERSON (Lindsay Tisch): Yes, this has been well canvassed. I will put the question.

A party vote was called for on the question, That the question be now put.

Ayes 63

New Zealand National 59; Māori Party 2; ACT New Zealand 1; United Future 1.

Noes 58

New Zealand Labour 32; Green Party 14; New Zealand First 12.

Motion agreed to.

The question was put that the following amendment in the name of Julie Anne Genter to the proposed amendment in the name of the Hon David Parker to insert new Part 6 be agreed to:

in clause 12, after new section 46C(2)(a), insert:

(ab) a prohibition on the use of rules in district or unitary plans to require any number of car parking; and

in clause 12, new section 46C(2)(b), after “corridors and networks”, insert “, taking into account the need to mitigate and adapt to climate change,”.

A party vote was called for on the question, That the amendments to the amendment be agreed to.

Ayes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Noes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Amendments to the amendment not agreed to.

The question was put that the following amendment in the name of the Hon David Parker be agreed to:

insert the following new part:

Part 6

Amendment to Resource Management Act 1991

11 Principal Act

This Part amends the Resource Management Act 1991.

12 New Section 46C

After section 46B insert:

46C National policy statement on Urban Growth

(1) The Minister must within 6 months of the commencement of this section prepare a proposed national policy statement on urban growth in accordance with the requirements under section 45 and 46.

(2) The proposed national policy statement on urban growth must contain:

(a) A prohibition on the use of urban growth boundaries within a regional or district plan where official statistics predict there will be population growth; and

(b) A requirement for local authorities to undertake detailed spatial planning which sets aside areas of special value, and sets out future infrastructure corridors and networks as an alternative to urban boundaries; and

(c) A comprehensive list of local government and central government infrastructure costs which should be taken into account when making subdivision decisions under this Act; and

(d) A standard formula for local authorities to use to measure the marginal cost of urban growth; and

(e) A standard formula for local authorities to use to calculate the cost of inefficient utilisation of existing infrastructure; and

(f) Rules to ensure that the costs of infrastructure are appropriately internalised for new developments.

(3) After preparing the proposed national policy statement on urban growth under subsection (1) the Minister will initiate the consideration process set out in sections 47 to 52 for implementation of the national policy statement.”

A party vote was called for on the question, That the amendment be agreed to.

Ayes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Noes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Amendment not agreed to.

Sitting suspended from 6.02 p.m. to 7 p.m.

New Part 7 Amendment to Housing Corporation Act 1974

METIRIA TUREI (Co-Leader—Green): I am very pleased to offer this additional housing solution to the Committee tonight as part of the large suite of housing solutions offered by the Opposition in response to the Government’s failure to do anything about the housing crisis. So this is the seventh of the proposals put forward. This one comes from a piece of work that the Greens did before the Budget, so in May of this year, where we announced our Homes Not Cars policy, which was to allow Housing New Zealand to retain both its tax and its dividend, for the purposes of building State houses. At the time that we made that announcement, it was the beginning of that acute awareness of the extent to which the homelessness crisis was hitting New Zealanders.

We had, in the Greens, the enormous privilege of having a young woman, Rhiannon, come and tell her story with us at the launch of that policy. She was a young mother of three children, one of whom has lung disease—young Emma. Rhiannon was incredibly courageous in telling her story to the New Zealand public, opening herself to potential abuse and judgment. But she talked, with her courage and with her concern for her daughter with her, about how—after a redundancy, a relationship break up, and having to move from a rental home that was being sold—she found herself in this terrible situation of having three children, one of whom was terribly ill and in hospital, and having nowhere to live but her car. She had nowhere to live but her car.

As she said at the time, she felt she could live in a car, if that was what was necessary, but she could not take her very sick daughter to live in a car. She talked about the six medications that her daughter needed every day that needed to be refrigerated, which, of course, she could not do in a car. So she was having to share her children out amongst friends and family, move Emma in and out of hospital, where she had some times with her sleeping on friends’ couches and some times back in the hospital. Her homelessness situation was acute. After the announcement of our policy, which is now set out here in new Part 7, New Zealanders actually came to the party, and she was offered rental accommodation and was able to secure stable accommodation, and for that we were very grateful, and so was she, for New Zealanders’ generosity and kindness.

But she should not have to rely on the kindness of strangers, because that is what she had to rely on to find a home. She should have been able to go to the agencies and the services of Housing New Zealand and talk to them about her story and show them what her needs were, and they should have been able to find her a house. That is what the State housing system was built for to make sure that a young woman like her, with her young children, has a house to live in where she could take care of her sick daughter who has lung cancer. But, as we all know, Housing New Zealand, under this Government, has been required to pay a dividend and tax, until very recently—exposed by Steven Joyce of course. It had State housing being sold, and so there are not enough State houses for the families who desperately need them, like Rhiannon’s.

This amendment, this change, to the Housing Corporation Act is quite a modest change. What it does is it will free up Housing New Zealand’s obligation to pay a dividend. So it is not the tax part; that requires quite a bit more change. But this new Part 7 will enable Housing New Zealand to no longer have to pay a dividend into the Government’s general coffers, but instead to retain that surplus and use that for the purposes of building State houses, State houses that families like Rhiannon’s need. This is critical because 2,500 State houses have been sold off under this Government, we have 4,500 people on the waiting list, and we have the lowest number of State houses per population since 1949. It is an absolute disgrace. The destruction of the State housing system that has provided the safety net for thousands, tens of thousands of New Zealanders over many, many, many decades—[Bell rung]

The CHAIRPERSON (Hon Chester Borrows): Metiria Turei, but before I allow her to continue with her call, if she would just be seated for a moment. I would just make the point that she spent 4 minutes 30 before she talked about what her amendment was going to do, what this part is going to do about retaining a dividend and applying it to the purchase of new houses. I urge her to stay on point in her second call and to talk to the part that we are discussing at the moment. Thank you.

METIRIA TUREI: Thank you, Mr Chair. Of course Rhiannon’s story is very specifically connected to this new Part 7 because new Part 7 will enable more State houses to be built—modest proposal as it is—so that women like her, mothers like her, will have a place to live. I think that is an important story to tell in this Committee. We have to remember that housing issues are not intellectual issues. They are not pointy-headed policy issues; they are about the ability for ordinary New Zealanders to live an ordinary decent life. Our job in Parliament is to provide—through amendments like the one I have put on the Table today—the structure, the infrastructure, and the funding to enable that decent life to be supported for New Zealanders.

So this provision will mean that the surplus of Housing New Zealand will not have to be sent directly back to the Government for it to use as it chooses, but reinvested in Housing New Zealand to build more homes. Now it is modest, and I think that that is important, and I think that is not only important to note but it is important to recognise that even modest changes to the law can make a significant difference. This means around 250 houses, possibly depending on the nature of the building, or 300 new State houses every year. It is a small step towards the many thousands that we need, but every single tool to fix this housing crisis is needed. This is one of those tools. We can free up this financial opportunity for Housing New Zealand in order to build more State houses.

As I said, we have the lowest number of State houses per population since 1949 while 4,500 people are on the waiting list. Let us just reflect for a moment on the 4,500 people on the waiting list, because 10 times that many are technically homeless in this country. Ten times that many do not have a safe secure home to call their own. The core function, we would have thought, of Housing New Zealand, and in fact of government, is to make sure that all New Zealand families have a decent, safe, and secure home to call their own.

So while we have 4,500 people on the State house waiting list, we have 10 times that number who are in severe housing need. So actually the State house waiting list is just a very, very tiny proportion of the people who actually need to be housed in this country. We need to remember that as we go through. That is why all of the previous tools that have been put forward by the Opposition and voted down by the Government have been so important for us to discuss over the last number of hours. Because these are the solutions that will house New Zealanders, including this solution, to enable Housing New Zealand to increase its State house building programme by at least another 250 homes, perhaps even 300 homes, in a year.

And let us not forget how much the forecast dividend was. Steven Joyce did, as I understand it, agree with our policy, and we appreciate that he agreed with our policy—using Twitter to announce his new policy framework that he would not require a dividend from Housing New Zealand.

Phil Twyford: He’s so modern!

METIRIA TUREI: It was such a modern announcement. It was very hip; it was very social media—the new way.

Hon Christopher Finlayson: What’s Twitter?

METIRIA TUREI: Ha, ha! Yes, a very modern way of communicating his new policy. So we are very pleased that our Government has done it, at least for this year and possibly for next year. But there is no justification for Housing New Zealand ever having to provide a dividend to the Government. Housing New Zealand has a core function of providing housing services to the country. Providing rental housing principally for those who need it is one of the core functions of Housing New Zealand. That is an expensive service. You have to build homes in order to make sure that there are enough. You have to make sure that you have a good infrastructure and a good funding source to keep doing it. Requiring Housing New Zealand to provide a dividend has been one of the worst decisions of this Government, because it has prevented Housing New Zealand from engaging in its core function, which is making sure that New Zealanders, those who need it, have a decent and safe and secure home to live in.

I urge members of the Committee to support this. I urge National members to support it. It is, after all, National policy now, according to Steven Joyce, so they should have no problem supporting a bill that does exactly what Steven Joyce has said he wants to do. I look forward to their support in the future. Thank you.

KELVIN DAVIS (Labour—Te Tai Tokerau): An inspired choice, Mr Chair. Thank you very much. It is a great day to be in Opposition, I have to say. It is a great day for the Opposition. This has been a day when the Opposition members have been able to talk at length, non-stop about our suite of housing policies and at the same time highlight the complete dearth of policy coming from the Government benches on homelessness, and the fact that we need more houses built. I just have to give credit to my colleague Phil Twyford for all the amazing work that he has been doing, developing our policy.

I believe that Housing New Zealand lost its soul when it decided that it was going to be there just purely to derive a profit from people who are using its services. It has become an organisation that does not see people as an opportunity to actually do some good for the country. It just sees people as problems and it treats them in that way. National has taken $523 million out of profits from Housing New Zealand, including a $118 million dividend for the year 2015-16 alone. Imagine how many houses, how many families, how many people could be supported in order to live in warm, comfortable, affordable houses if that money, instead of going into the Government’s coffers, was actually reinvested back into building houses for our people.

When people come into our electorate offices, there are four organisations that comprise the majority of complaints. First of all, there is Child, Youth and Family, there is Work and Income, there is ACC, and the fourth is Housing New Zealand. I can tell the story—this happened over a year ago—of a family of mum, dad, and three kids who arrived in Whangarei, and they were living in their car. They went to Housing New Zealand, and because the only house available had five bedrooms and they really needed only four they were actually declined that house. That is just ridiculous. The rules around Housing New Zealand and its policies just sometimes do not make sense. Instead of just thinking what is the right thing to do for people, what is the best way that it can support their kids to grow up in a warm, safe, dry, comfortable house so that they can get to school and be prepared to learn—instead of thinking about the ways that it can provide a home for parents so that they can look after their families, it puts every single barrier in the way of these families that it can think of. As I said earlier, instead of looking at ways to help, it sees people as problems, and that, to me, is totally unacceptable.

“What is the social cost in years to come?” is the question that I ask. What is the social cost in years to come if children are growing up not in warm, safe, comfortable, affordable homes but where parents are struggling with rent and struggling to get by in poorly maintained homes? There is a social cost to the country in years to come that is far greater than the cost of actually just providing a house in the first place.

When we talk about affordable homes, one of the submitters at the homelessness inquiry last week in Kaitāia spoke about his ability to build an affordable home—and Housing New Zealand could take this idea on—a 100 square metre home for $100,000. He can construct it in a workshop in 4 days and erect it on site in 3 days. He was saying that he can build homes all around Tai Tokerau—a 100 square metre home for $100,000 and a 200 square metre home for $175,000. How many houses could that $118 million dividend pay for and erect all around the country if the Government had just looked at and attended the homelessness inquiry? Government members were not there at all. These were ideas that could have been taken to Housing New Zealand. The Minister for Building and Housing could have said “Hey, look. Here’s a really good idea that’s come out of the homelessness inquiry that Labour, the Greens, and the Māori Party have established.”, and we could use some of these ideas to build—

ADRIAN RURAWHE (Labour—Te Tai Hauāuru): Tēnā koe e Te Heamana. I am pleased to take a call on this new Part 7 of the Housing Legislation Amendment Bill. First of all, can I point out again—I think it has already been said—that the public has not had the opportunity to make submissions on this bill. I took the opportunity to read some of the submissions from the 2013 Housing Accords and Special Housing Areas Act, and I came across a submission from the Salvation Army that bemoaned and pointed out its concerns about the lack of any reference to affordable housing. I stand to support new Part 7 because it is supporting affordable housing. It is really important, and I think there would be very few in this Chamber who would not see the value that the Salvation Army brings to this country, in particular in terms of addressing the issues of homelessness and affordable housing.

More specifically, in Part 7, new section 40(1) inserted by new clause 12 means that the surplus moneys would be used for the functions of the corporation. I also took the opportunity to look at the functions of the Housing New Zealand Corporation. The very first one, stated in section 18(2)(a) of the Housing Corporation Amendment Act 2011, is “providing rental housing, principally for those who need it the most”. That really underpins this new Part 7.

I want to commend Metiria Turei for bringing this to the Committee. I think, alongside all of the other new parts that were brought to the Committee—and I want to acknowledge Phil Twyford for his work in bringing these comprehensive new parts to this bill. Providing rental property principally for those who need it the most—this new part actually addresses that, and I think that it is incumbent upon this Committee to accept this. As Metiria Turei pointed out, we have heard from Minister Joyce that they are already doing great, but we want to make sure that it is enduring, because if the Government can make that decision at a whim, well, at a whim they can turn it around as well. I think that our country, in particular those who need it the most, deserve better than that. So I wholeheartedly support new Part 7.

As I pointed out before, because this has not gone to the select committee, I read some other submissions. I read the submissions from Te Rūnunga o Ngāi Tahu and from Tainui Group Holdings Ltd, and what struck me about their submissions to the principal bill that we are debating tonight is that they pointed out its deficiencies around addressing Māori rights within it. In thinking about what that process would look like if those submitters had had the full opportunity to make submissions on this bill—granted that these are new parts—they would not have had the opportunity to speak on these as well.

I think it just highlights a point around the real importance of that process and the real importance of the point—of which I am absolutely certain—that, given the opportunity of speaking to this Part 7, the majority of those submitters would be supporting it. They have not had that opportunity, so we in this Chamber must ensure that we bring that opportunity to them. We must also ensure that those surplus moneys that are generated within Housing New Zealand—another thing that occurred to me, if the Government had had a proper building programme for more affordable housing and State housing, then there would actually be more profits to be shared, again, for the purpose of providing affordable housing.

I fully commend the new Part 7 to the House, and I am very happy to do so. Kia ora.

PEENI HENARE (Labour—Tāmaki Makaurau): I rise in support of the amendment, the proposed new Part 7, tabled by our good colleague Metiria Turei. Many of our colleagues here have already spoken about much of the good that can come from this. We have waxed lyrical in this House about how, over decades, the quality of the housing stock has really declined.

It will be a sad day in this House if we leave it for another how many decades to fix it up, to make sure that the houses that our people live in and are provided by the State are up to scratch, up to standard, are healthy, are warm, and are safe for our families. That is an important step. Although we need to build new homes, although we need to reinvest that money to make houses more affordable, we must make sure that the stock that is there does not decline any further. We must invest in them so that in decades to come they are of a standard that we would like to live in, that they are of a standard where we want our kids to grow in.

We want to raise our families in warm homes, safe homes, dry homes, and I think this particular amendment, the proposed new Part 7, is a fantastic way to do that. Where else should that money go? We know that this is a crisis. We know that Governments have ignored this. This Government has had 8 years, and ignored it. It is important that any profit that is derived from Housing New Zealand actually goes back into, firstly, the stock of Housing New Zealand to make houses more affordable, to grow the stock and, I would like to think, secondly, to maintain that stock, and also to bring whatever is left of our current stock—whatever is left after the sell-off; let me put that out there—up to standard, to make sure that it is safe, warm, and dry for all of our whānau.

I had hoped that this was a step in the right direction, whereby if there just happens to be a bit of money left—which I doubt there will be, but if there is—we need to support our social housing providers out in the community, to provide them with support. We have heard through the homelessness inquiry that many of these social housing providers, in particular in Tāmaki-makau-rau, where I was fortunate to be for the day to listen to the submissions—it blew me away: no support. We read in the papers that millions of dollars are being given to support them. Well, that might be the case for the beds that are there, but what the inquiry did prove was that the need is greater than the supply that is there already. So, just in case there is any money left, I think this particular tabled amendment, proposed new Part 7, is a step in the right direction to signal that when there is surplus we should be supporting those social housing providers, who do a fantastic job, not just in the cities but also in the regions.

We heard some fantastic ideas. What did they lack? Financial support. We see some people digging into their own pockets to make sure that they are able to provide the services so dearly needed by the people in our communities—digging into their own pockets. They are displacing some of their own whānau to make sure that these people in need have a place to stay, have a bed to sleep in, and tamariki have a roof over their head.

I would like to think that this particular tabled amendment, proposed new Part 7, will at least encourage this House, this Government to start looking forward to futureproofing housing for the country, and stock, supply, affordability and, of course, the quality of housing that we expect, that the people of Aotearoa New Zealand expect, should they ever need it. Should they ever need it, because, let us face it, not everybody is going to be able to climb up that ladder to own homes. So we need to be able to provide many families the opportunity to have a safe, dry, warm home to raise their families in, in the hope that one day they may be able to own a home. I do not believe it is about providing it for them forever, but this does need to be a platform to allow them their own tino rangatiratanga, their own independence, so that they are able to enter into a market that, at this moment in time, is shutting the door on far too many. I support the proposed new Part 7 amendment, tabled by our colleague Metiria Turei. Kia ora.

Su’a WILLIAM SIO (Labour—Māngere): This is my first call, and I hope it will be my first of four calls on new Part 7. I want to pose a question to the Minister in the chair, Chris Finlayson, and to this Government: what is going on with this Government? The whole bill is about increasing the supply of housing and increasing affordable housing, but for the vital parts of the bill that we have presented—new Part 3, increasing the house supply by 10,000—they vote it down. We talked about cracking down on speculators; they vote it down. I hope that they do not vote down new Part 7, which I now come to.

New Part 7 says that it requires that, instead of what this Government is doing—taking money out of Housing New Zealand and using it for whatever it desires—that money actually ought to go back to Housing New Zealand so it can build more social housing. So it is to focus on the function of Housing New Zealand. I will tell you why that is important: because, at the moment, the whole purpose of Housing New Zealand, that social foundation of providing housing for the needy, has been destroyed. Yet for the first Labour Government that set up Housing New Zealand, its very purpose was to help those in need of housing, particularly after World War II. But this Government comes along and in 8 years has destroyed that basic foundation of what Housing New Zealand was established to do.

I agree with section 18(2)(a) of the Housing Corporation Act in “providing rental housing, principally for those who need it most”. That should be what Housing New Zealand is about, and yet today I can give you examples. In the Housing New Zealand office in Māngere, they kick people out who are in need of housing for simple things. One woman was behind on rent by $100. They gave her 90 days’ notice right on the spot. They would not even give her the opportunity. This is a sole mother who works, and, in fact, on the phone they bullied her. That is just one example of many. The needy whom we talk about are the people who are living in cars and living in garages. The other day Alfred Ngaro said to me: “We’ve always had people living in garages and in cars.” That is what he said. That is ludicrous. We may have had people living in garages, but only on a temporary basis in preparation for getting themselves on their feet. This Government has normalised people living in cars and in garages.

This amendment surely needs to pass so that the money generated by Housing New Zealand can go back for the building of social housing for those in need. Housing is a fundamental right. I heard in the homelessness inquiry—here is something that I hope will prick the heart of that Minister. An investor said to me—this was presented at Te Puea Marae—“Housing is so critical for raising families and communities. If families have a stable habitation, a stable house, it means those children will have a stable family, stable schooling, and a stable group of friends, because they are not moving around from house to house. Generally, that means that you have good, strong local communities contributing to that community.” That is what would happen if we were investing money properly into Housing New Zealand and providing for the needy.

But we do not want people just to be living in social housing; we want them to own their own homes. That is part of our overall plan, and I had thought that that was what this Government was doing in this legislation. But, again, in that initial question, “What is going on with this Government?”—it is crazy what it is doing, on the one hand saying that it wants to increase the supply of affordable housing, and on the other hand voting down every initiative that we have put up. I suspect it is going to vote down this initiative, but this initiative is about helping the needy—helping the needy. I cannot understand how some of those MPs on that side can live with themselves—people who believe that they are close to the community. I am not pointing my finger at anyone in particular, but I want to name Alfred Ngaro and Peseta Sam Lotu-Iiga, because they go out to the community and say—

LOUISA WALL (Labour—Manurewa): Malo e lelei, Mr Chair. Thank you very much for this opportunity to contribute to what has been a robust debate. I am particularly supportive of proposed Part 7, which has been introduced in an amendment by my colleague Metiria Turei. What she hopes to amend is section 40 of the Housing Corporation Act, which is “Distribution of profits”. It is interesting when you read the Housing Corporation Act 1974, because it is all about paying money into a Crown account. How much money have we paid into the Crown account? Well, in 2014 we paid $108 million into the Crown account, on 8 September 2015 we paid $118 million into the Crown account, and, in fact, we forecast in this year’s Budget to put in $38 million this year and $54 million next year. Based on that, in answer to my colleague Kelvin Davis’ question: $126 million, Kelvin. That is over 2,200 of your 100 square metre properties, and over 1,500 of your 200 square metre properties, that we could have built in the North. This amendment is actually really relevant when you look at those figures because we could have added to the housing stock over 2,000 properties, which would have housed those most in need.

I want to particularly look at the functions of the Housing New Zealand Corporation. My colleague Adrian Rurawhe talked about section 18(2)(a) of the Housing Corporation Act, which is about “providing rental housing, principally for those who need it most”, but I want to talk about subsection (2)(b), which is about “providing appropriate accommodation … for community organisations … that provide residential support services for people with special needs):”. The reason I want to highlight that is that I was fortunate enough to participate in two sessions of the homelessness inquiry—and I would like to take this opportunity to congratulate my colleague Phil Twyford, my colleague Marama Davidson, and also my colleague Marama Fox on the way that they conducted that homelessness inquiry.

What I would like to bring to the table is the unmet need that will be met by the money that will be reinvested into one of the functions of the Housing New Zealand Corporation—the communities that will benefit most from this particular amendment. I particularly want to highlight from Monday’s hearing here in Wellington the submission by Ara Taiohi. It was given by Anya Satyanand and Sandra Dickson, and it focused specifically on the exclusion of LGBTI youth and LGBTI homelessness. I also want to acknowledge that another member of that submission group was Kassie Hartendorp, who works for Evolve. Where we got to, in terms of their representation of LGBTI youth, is that they are already a marginalised group. We have an already marginalised group—because they do not have the family structures available—living on the streets or relying on, as Sandra said, people like herself who are part of the community allowing these young people to sleep on their couches.

One of the solutions that was proposed in the submission hearing on Monday was that maybe we should create a hostel that would be funded by Housing New Zealand and serviced by LGBTI groups for LGBTI groups. That is a huge unmet need in our society. That would be a tangible investment by this Government, based on this proposal by my colleague Metiria Turei.

I want to now quickly reference the 22 August hearing at Te Puea Marae, and particularly want to highlight the submission by Danielle Bergin, who works for the Island Child Charitable Trust. One of the things she said that struck me most was that of the last six families she had had, five of them had newborn babies. She provides a service that aims to help up to 35 families a year, but because of restricted funding it could help only 15. It brings in a context where young women are provided with the support to know how to parent and they are given an opportunity to create a loving bond with that child. This, again, highlights a whole lot of unmet need that this reinvestment, by not putting it into the Crown accounts, can contribute to. Kia ora.

The CHAIRPERSON (Hon Chester Borrows): I just want to take a moment, if members could be seated, to remind the Committee what we are doing here. We have had an amendment put up. It is quite narrow in what it says. It is very specific about not taking a dividend from Housing New Zealand Corporation for the Government and applying it back into the purchase of homes. We do not need big long stories or tales of woe.

The context has been given by the initial speaker, Metiria Turei, who was the proponent of the amendment. People need to be either asking the Minister for Building and Housing questions or they need to be doing technical analysis in respect of what this proposal does by way of amendment. Bear in mind that this is an amendment, so the questions you can ask the Minister are fairly limited.

I expect that the debate on this will be very narrow, and it should be, because it is a very narrow and very easy to understand amendment.

METIRIA TUREI (Co-Leader—Green): I raise a point of order, Mr Chairperson. As I understand it, this whole bill began with a clear statement that the debate was to be wide ranging. I also would put to you that as a wide-ranging debate and one where we have not had the opportunity to hear submissions from New Zealanders—from the public—we actually have an obligation to our constituents to talk about the impacts on them of legislation that we are considering. So telling those stories is critical to explaining how legislation will impact on the people we are here to represent. Yes, there are some narrow provisions that we are debating, but I would strongly suggest that you reconsider your view in light of the fact that we have an obligation as representatives in this House to talk about the effects of legislation on our constituency, and this is the only opportunity that we have to do so.

The CHAIRPERSON (Hon Chester Borrows): Ruling on that, the point is that you have got an obligation to address the part that is under debate at the moment. That does not give a licence to any speaker to then retell the context over and over and over and over again. Actually, that leads to repetition, and that is what the Chair is responsible for maintaining a control on. That is not something that is going to be tolerated. As members will well know, there have been several hours of debate in respect of this bill, and the context has been put many, many times during the course of that debate.

The ability to be able to have a wide-ranging debate is during the first, second, and third readings. This is the Committee stage, where we analyse the parts that are before the Committee, and at this time we are debating a very narrow and well-constructed Supplementary Order Paper that is around this particular part. The wide-ranging debate relates to the readings. The Committee stage relates to the analysis of the parts that are before the Committee. There has been quite a bit of leniency displayed so far, for members to be able to do that. I am giving you an indication, as I have on previous tours of duty in respect of this particular bill, that we are going to keep it tight.

METIRIA TUREI (Co-Leader—Green): I raise a point of order, Mr Chairperson. I am just seeking clarification.

The CHAIRPERSON (Hon Chester Borrows): Simply for clarification—a point of order, Metiria Turei.

METIRIA TUREI: Can I clarify then that you are not ruling out members of Parliament, in this Committee stage debate, describing the impacts? As part of the analysis of the legislation we are considering, are you ruling out us describing the impact of this legislation on the constituents whom we represent in this House?

The CHAIRPERSON (Hon Chester Borrows): The impacts of the legislation should be well described within the first, second, and third readings. The purpose of this Committee stage is to analyse and debate the strict terms of what each part does. Members do not have leniency to spend several minutes in a 5 minute call putting in context, which has been done several times over the course of this debate, or they run the risk of being called for repetition and being sat down.

This is about analysis. The Committee stage is about analysis of the parts that we are debating at any one time. I hope that is clear enough.

DAVID BENNETT (National—Hamilton East): I move, That the question be now put.

SUE MORONEY (Labour): It is a pleasure to rise and speak to this excellent amendment, proposed Part 7, from Metiria Turei about making sure that the money that is dedicated to Housing New Zealand is used for the purpose of housing New Zealanders. It is not a hard thing to ask for—

Phil Twyford: Pretty radical.

SUE MORONEY: I know; it is pretty radical, but, actually, it is pretty simple in its context. It is what every New Zealander would expect their Government to be doing on their behalf—ensuring that the money put aside in the Budget for housing is dedicated to housing.

I want to bring Hamilton into the debate. We have spoken a lot about Auckland. I see there are two members opposite in the Chamber who are from Hamilton, but I do not think we are going to hear anything from them any time soon. They are probably too embarrassed to talk about the impact that Part 7 has on their constituents in Hamilton, and so they should be. About 2 weeks ago Andrew Little came to Hamilton. He addressed a lunchtime meeting on the issue of housing, and there was standing room only. That is how much this issue of Housing New Zealand and how it is operating in New Zealand, and the lack of housing available under Housing New Zealand, is impacting on Hamiltonians. David Bennett might find it entertaining, but I can tell that member, and he should know this himself from the people who come in his door, that it is not at all entertaining for those people who are sleeping in cars and who are sleeping in garages, because Housing New Zealand is paying a profit, a surplus, back to his Government, instead of building more State houses in Hamilton, where they are needed.

The example I will give you, and I took Andrew Little to see this particular block of land, is Jebson Place, which is in David Bennett’s electorate. Actually, Jebson Place and Dey Street, around that area, over in Hamilton East, is a beautifully located piece of Housing New Zealand land. It is largely abandoned. The State houses are boarded up, left derelict by that Government for years, while the need for housing grows exponentially in Hamilton. Our housing prices have increased by an average of 30 percent in the last year alone, and that Government has left that block of land empty, with houses boarded up, derelict. It is like a ghetto, in the middle of Hamilton.

The CHAIRPERSON (Hon Chester Borrows): Back to this part.

SUE MORONEY: Back to this part, Mr Chairperson. The surplus that Housing New Zealand has been told to pay back to that Government should be spent on developing good, healthy State houses in Jebson Place, where people can live, not have these resource consents so that people cannot live in them, but have actual houses, built by Housing New Zealand.

I will give another example in Hamilton. This is another one in David Bennett’s electorate, actually. It is known locally as Poets Corner. Well, actually, nothing could be less than poetic than what has happened to that Housing New Zealand land. Housing New Zealand should be using that surplus to build houses on that land. In fact, it was under the last Labour Government that we decided that particular development was not up to standard, and so we cleared it. We had consulted with the local community, to find out what type of State housing they wanted erected in its place. We had an agreement with the community, because we consulted with it, about exactly what that development would look like. What happened next was that when the National Government came in, it left that land abandoned and, again, derelict for years, and still not one State housing tenant has a house back in Poets Corner. No one is tenanted on that block of land because the Government still has not built State houses there.

David Bennett: Yes, they have.

SUE MORONEY: No, it has not. Is anyone living there, David Bennett? Who is living there? What is the street address?

David Bennett: I opened them last week.

SUE MORONEY: You opened them last week. So it took the Government how many years? Is it 9 years that we are up to? Well, 8 years—8 years, and the Government opened one house last week. I do not know whether anyone is living in it yet, but that is how long that Government has neglected State housing in places like Hamilton where the housing needs are that high. Part 7 would ensure that instead of paying a dividend back to that greedy Government, to balance its books, Housing New Zealand would be able to invest money in building good, healthy State houses in cities like Hamilton.

KANWALJIT SINGH BAKSHI (National): I move, That the question be now put.

A party vote was called for on the question, That the question be now put.

Ayes 75

New Zealand National 59; New Zealand First 12; Māori Party 2; ACT New Zealand 1; United Future 1.

Noes 46

New Zealand Labour 32; Green Party 14.

Motion agreed to.

The question was put that the following amendment in the name of Metiria Turei be agreed to:

insert the following new part:

Part 7

Amendment to Housing Corporation Act 1974

11 Principal Act

This Part amends the Housing Corporation Act 1974.

12 Section 40 amended (Distribution of profits)

Replace section 40 with:

40 Profits to give effect to Corporation’s functions

(1) The Corporation’s surplus must be used for those functions under section 18(2) that increase the supply and affordability of housing.

(2) In subsection (1), surplus means surplus capital, and any operating net surplus, after any provision the Minister thinks proper has been made for any matters that, in the Minister’s opinion (reached in the light of the Corporation’s statement of performance expectations and annual financial statements) are necessary for the efficient and effective conduct of the Corporation’s operations.

A party vote was called for on the question, That the amendment be agreed to.

Ayes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Noes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Amendment not agreed to.

New Part 8 Amendment to Housing Restructuring and Tenancy Matters Act 1992

POTO WILLIAMS (Labour—Christchurch East): It is a real pleasure to rise and take a call on new Part 8 in this Committee stage debate. Firstly, I want to say that this is #changethegovernment in action happening right here. I have to commend Metiria Turei and Phil Twyford for the work that they have been doing through their Supplementary Order Papers and amendments.

Part 8 looks at amendments to the Housing Restructuring and Tenancy Matters Act 1992, and I want to confine my comments to a couple of the provisions in Part 8. The first one I want to discuss is new section 72A, inserted by clause 12, which looks at ensuring that there is sufficient funding for the income-related rent subsidy when there is not enough social housing stock to meet the need of people who need emergency housing or social housing.

What we have found throughout the homelessness inquiry is that people are forced into really precarious housing situations. It is the role of Housing New Zealand—and it is actually the role of the Government—to ensure that people are housed sufficiently, and I know that there will be many people who have a sense of disquiet at the growing numbers of people who are living in very precarious housing situations. They are not just Labour and Green supporters; they are people everywhere who see the growing numbers of homeless in our country and have a real disquiet about that.

New section 72A actually looks at how we take care of providing not just emergency housing but sufficient housing to give people the opportunity to have somewhere to live while they get their acts together and while they build their resources to be able to, hopefully, move on into homeownership. So having the ability to support social housing providers through the income-related rent subsidy when there is insufficient stock of social housing to take care of the need is very important.

I am absolutely overwhelmed by how good a job we have been doing with these amendments to actually develop a comprehensive housing plan for this issue. This is being debated in this Chamber today, and I would have to say there will be a lot of people who are watching this debate saying: “Why doesn’t the Government do this?”.

Hon Ruth Dyson: Or anything—do anything.

POTO WILLIAMS: Yeah. I for one would be really happy if the Government would take the opportunity, with all of these wonderful ideas that are coming to the Committee today, to do something to address the growing levels of need.

The other provision that I want to address in the last 2 minutes of this call is new section 98C(2)(d), inserted by clause 13, which says that you should have a plan to provide appropriate responses to the diverse groups needing housing. In this regard, I want to pay particular note to a couple of groups that I do not think have been identified as having unmet need.

The first one is youth. When I had a job in the real world in a place called Waipuna—which hosted one of the homelessness inquiry sessions—we did a lot of work with young people. Young people do not have credit. They are sometimes a risk to landlords. They find it very difficult to get into housing. They cannot find sufficient money for bonds. This is a group that finds it very difficult to get housing. They often are young parents. What I am really hopeful for is that, as part of Part 8, this diverse group will have access to housing.

The other group that has significant need that has not been addressed is women and children escaping violence. This is a group that actually has a huge level of unmet need. We do have refuges, but they have expressed real concern at not being able to provide an opportunity, once the crisis is over, for those women and kids to have decent accommodation. We need to be able to be providing safe opportunities for housing for our communities.

DENISE ROCHE (Green): Tēnā koe, Mr Chair. I have been looking at the amendments, and the Green Party position is that we fully endorse and support this amendment. It would make a significant difference to the legislation if it was to be passed in the Committee tonight. The first part of this amendment relates to income-related rents. I think that if we look at what the average incomes are at the moment, it makes sense that we should be looking at rents that people can afford. We believe that shelter is a basic human right and that the Government has the responsibility to provide that shelter. If the market does not provide, then those people need shelter, and the market is broken. It is certainly not delivering shelter to, what, 32,000 people who are currently homeless—32,000 people, many of whom are children, who are living in their cars.

We have just wound up the cross-party inquiry into homelessness. I sat on that inquiry in Tauranga and heard the gut-wrenching testimonies from good people—good people—trying to earn a living and provide for their families. But if we look at income and income-related rents, what we find is that the minimum wage is $15.25 per hour. That comes to $610 for a 40-hour week. In Auckland, the average rent for a three-bedroom house is around about $510 a week, leaving—what is that—$100 for a family to exist on for a week. If we put some controls on the speculation in housing and housing becoming a commodity, which is being used to make the wealthy wealthier, and we see it as a basic human right with responsibility on the State to provide housing at a cost that normal working families can afford, then that is what we should be doing, and that is what this amendment does.

Currently, there are around about 300,000 people who are earning close to that minimum wage, which is $15.25 an hour—300,000 people. That, per annum, is just under $32,000 a year. If you consider the cost of rental accommodation in Auckland, which is becoming increasingly beyond the capacity and beyond the affordability of normal working families, and if you also consider that it is way beyond the price range for normal families on the minimum hourly rate to actually be able to afford to buy any of these homes, given that in Auckland it is now, what, $1 million on average to buy a normal place to live—when you consider all that—then we do need to consider that this Parliament should be taking steps to provide housing.

The amendment also talks about emergency housing, and this is something that we really should be looking at. We cannot be continuing on with this situation where we are putting families in motels and where families with small children are ending up in boarding house rooms just for shelter. That is a shameful, shameful way to be. I want to thank the member Phil Twyford for putting forward this amendment, which we will be supporting wholeheartedly. There is a lot more that we could be doing to give families and hard-working, ordinary New Zealanders the ability to have shelter—that basic human right. This is the amendment that will deliver it, and I think we should be supporting it.

Hon MICHAEL WOODHOUSE (Minister of Immigration): I raise a point of order, Mr Chairperson. I seek your ruling under Standing Order 302(2) about the admissibility of proposed Part 8 in Mr Twyford’s name. Before the dinner adjournment I raised this point on amendments amending the Income Tax Act, the Overseas Investment Act, and the Resource Management Act, and it was declined on the basis that, however oblique, those amendments did relate to the issue of housing affordability. However, having read this amendment, the amendment itself, however noble, does not relate to that and the purposes of the bill we are debating—it relates to income-related rent, the issues of homelessness, and the issues of emergency housing. Nothing in there has anything to do with the primary purpose of the bill, which is related to affordable housing, and I seek your ruling that it is out of order.

PHIL TWYFORD (Labour—Te Atatū): I think it is not enough for a bill to just say “This bill seeks an increase in the supply of affordable housing.”; I think it is reasonable that we should apply some critical faculties to this. I would argue that it is almost self-evident that the provision of affordable rental housing through an organised programme like State or social housing is about supplying a significant part of our community with just that—affordable housing. It is so close to the declared aim of Parts 1 and 2 of the main bill that I would have thought it stands.

Hon MICHAEL WOODHOUSE (Minister of Immigration): Speaking to that, and accepting the point Mr Twyford makes, the Standing Orders are very clear that where there is a single bill being amended, the scope to introduce new amendments—even by the Minister or the Government—is extremely narrow. The reason we are able to have debates of this nature is that this is an omnibus bill, and, as a consequence, a much broader discussion about the issue at hand. But in this case, the issue at hand is not about income-related rents or homelessness; it is about housing affordability. It is on that point that I seek the matter to be ruled out.

PHIL TWYFORD (Labour—Te Atatū): Indeed, the scope for considering additional parts to this bill is confined to the subject of affordable housing, and I would just reiterate that providing affordable housing in the form of State or social housing or emergency housing for people who are most acutely in need is directly synonymous with the supply of affordable housing. There is nothing in the description of the earlier parts that says it is exclusively about affordable housing for homeownership. It is about affordable housing.

Su’a William Sio: Mr Chairman.

The CHAIRPERSON (Hon Chester Borrows): Su’a William Sio—is it a point of order?

Su’a William Sio: No, I am going to—

The CHAIRPERSON (Hon Chester Borrows): Well, give us a chance to have a think about it, will you?

Denis O’Rourke: Mr Chair.

The CHAIRPERSON (Hon Chester Borrows): Is it a point of order?

DENIS O’ROURKE (NZ First): It is just speaking to the point of order. I would like to make very strongly the point that the term “affordable housing” does include rental housing and does include social housing, and the two things are actually directly interrelated—people who cannot afford to buy houses do actually have to rent houses, and the problem is that some of them cannot even do that. So this matter has to be looked at considerably wider than the Minister has indicated. It is not as narrow as he tried to persuade you, Mr Chairman. Affordability is a very broad subject, and we were assured, when I raised a point of order at the very beginning of this debate, that this would be a wide-ranging debate. It would not have to be very wide if you were to include affordability of housing, whether it be rental or house purchases, as part of the consideration of this bill.

CHRIS HIPKINS (Senior Whip—Labour): Speaking to that, I may be able to be of some assistance in that these issues were, in fact, canvassed, and the Speaker did give a ruling indicating the breadth of the debate. One of the issues that this bill deals with is the disposal of State housing land, so, therefore, it does actually open up the scope of debate around affordable rental housing and State housing—or what the Government now calls social housing.

The CHAIRPERSON (Hon Chester Borrows): I am prepared to rule on this matter now. There are a number of matters within the amendment. There are some matters in it that I do not think fit within the scope—for instance, the plan to end homelessness. But I do note that in the explanatory note, on page 2, it says that “The purpose of the bill is to support the wider Government programme of work to increase the supply and affordability of housing,”—not referring to homeownership—“and to maintain the momentum of strong growth in new home construction.” New home construction, in the view of the Chair, includes rental accommodation. I do not believe—and I want to restate this for the purpose of Minister Woodhouse, who has taken this point of order—that anything that relates to a house or a rent or a condition such as homelessness or a situation that people find themselves in will fall within the scope of this bill, but I am convinced that the current amendment is narrowly within scope.

DENIS O’ROURKE (NZ First): New Zealand First will be very pleased, indeed, to support this new Part 8. In fact, when you think about it, it is surprising that the Government itself has not done something about this, because it is actually fundamental if the Government is genuine about improving the ability of people in this country to find a home if they cannot actually afford to buy one. If you cannot afford to buy one, you still have to afford to rent one. So this part is extremely important.

I note, also, that quite recently, in the last few weeks, Minister Bill English was asked a question in Parliament, in answer to which he stated that the Housing New Zealand Corporation would add an additional 1,700 State house places this year. That was what he said the corporation would be doing. But not long before that, during the Budget debate, he actually said that the Government would be selling 2,000 State houses. So at the same time that the Government is going to provide 1,700 new State houses, it is going to be selling 2,000. If you were to believe those figures—and they came from Government Ministers—then there would be a deficit of 300 houses in the current year. That is very strange, when you consider the magnitude of the waiting list that already occurs in New Zealand.

I have just been reading an article in Hawke’s Bay Today that talks about the number of people—I think it refers to 1,400—in Hawke’s Bay who are homeless, and, more than that, a huge proportion of them are children. There is actually a photograph, as part of that, showing two children sitting on the footpath with a notice saying “Please help.” What they are saying is that they do not have a home—two children, no home, nowhere to go.

What kind of a country are we turning into where children cannot find a home—not just a few, but by the dozens, by the hundreds? What kind of a country are we turning into when that happens? I am very grateful to the news media for bringing all of these examples to light. They are doing a great job on that. Now it is our job—most particularly, it is the Government’s job—to do something about it, and yet it is opposing this very sensible new addition to this bill.

That is why I began my speech by saying that I am surprised that the Government is not doing this itself, because the most important part of this new Part 8, that I can see, is actually on the first page. The addition of new section 72A would require the Government to do exactly what I am talking about. Once it finds that there are more people who require housing than is available through Housing New Zealand, it would then be required to provide the funding necessary so that the corporation could increase its supply by 1,000 per year. What on earth is wrong with that?

Mr English in particular tried to persuade this House only a couple of weeks ago that the Housing New Zealand Corporation’s programme would be sufficient to meet demand. That was the nature of the questions put to him during question time, and that was when he said that there would be 1,700 more places available in the current year—at the same time, of course, as selling 2,000. That does not make sense, but, nevertheless, that is what he said.

If he is serious about meeting demand, then the National Government will be voting for clause 12, which inserts new section 72A. But, of course, very few of us on this side of the Chamber actually credit the Government with a genuine desire to use Housing New Zealand Corporation in any way whatsoever to actually solve the awful housing crisis in this country, where children have to sit on footpaths with notices saying “Please help me.” Ignored by this Government, and fought for by the parties on this side of the Chamber. It is not good enough. Government: you need to improve.

CATHERINE DELAHUNTY (Green): Tēnā koe, Mr Chair. Tēnā koutou e Te Whare. This is not just a housing crisis; this is a moral crisis. This country is actually in moral crisis as I speak. This amendment to insert new Part 8 is important, like all of the amendments, because what they do is articulate to the country—and people are watching us here tonight—that some people recognise the crisis, and some people recognise that practical, affordable, and reasonable steps need to be taken to work our way out of this crisis. As the previous speaker, Denis O’Rourke, said about this part, it is disturbing to think about our kids right now outside in the cold. As yet another wintery blast hits the country, there are kids outside in the cold. There are parents trying to get them out of the cold. Meanwhile, in Parliament there is a bill before the House that will not help that situation at all, because it has missed the point. It would be easy to say deliberately; it would be kind to say that the Government just, kind of, made a mistake—it meant to produce a wonderful housing bill that was going to work it all out.

But this part is important because it actually spells out the issue around income-related rents. You cannot separate the word “rent” from the word “income”—well, if you do, you are obviously living in fool’s paradise or you are really rich. But the main thing is, we were here about a week ago arguing about the minimum wage. We were arguing that there should be a minimum wage for contractors, and the Government—

The CHAIRPERSON (Hon Trevor Mallard): Order!

CATHERINE DELAHUNTY: I am about to link it.

The CHAIRPERSON (Hon Trevor Mallard): Well, it would be very good if the member did so quite quickly, because I think you heard the previous ruling. I think it is fair to say that this part was marginal as to its scope, and the member is getting a fair way outside speaking directly to it.

CATHERINE DELAHUNTY: Thank you, Mr Chair. I would like to get directly to the relationship between income-related rent and the minimum wage—i.e., if you are not getting the minimum wage, you cannot even pay the rent. I think that is within scope. Proposed new section 72A says: “The joint Ministers must ensure sufficient funding is available for income-related rent places” in Housing New Zealand houses. The good thing about this amendment is that it attributes responsibility to these joint Ministers, not only in clause 12, inserting new section 72A, but also in new section 98B, “Joint Ministers must ensure sufficient places for emergency housing”. So what it does is it actually names the Ministers of the Crown as responsible. This is appropriate because the State has a responsibility to look after housing, and this is what this bill is about. It is about the role of the State. The joint Ministers must ensure “all people who are homeless have the ability to access accommodation and the services they need.”

At risk of deviating, we have to look at Te Puea Marae. They acted like the joint Ministers; that is what they did. They acted like—maybe we should write into new section 98B: “The joint Ministers, as a reflection of the leadership provided by Te Puea Marae, will act to provide sufficient places for emergency housing.” The leadership came from the people, and new section 98B(2) is all about “The joint Ministers must ensure the number of funded places available in emergency housing each year is not less than 8,000.” I am sure that we would need all of those places. I am sure that what we saw at the marae was about the need for ongoing emergency housing. I, personally, am aware, having visited Whangarei—which is not Auckland—that there is a crisis in emergency housing in Whangarei. There is a crisis in emergency housing—

Clare Curran: Dunedin.

CATHERINE DELAHUNTY: —in Dunedin. There is a crisis in my own town in Thames. There is always a crisis in emergency housing funding because no one is taking responsibility for the overall picture. The Government is just leaving it to agencies that are desperate, and then it has cut the community funding for that.

So those joint Ministers—I am not sure who they are, but the joint ones—can get together and do something about it and make sure that emergency housing is warm, dry, and safe. So it is not just that the joint Ministers must ensure that these places exist, but that they cannot just say any old dirty boarding house will do. What they have to say is “premises which are warm, dry, and safe.” I think “safe” is a critical word in this new section. It is very good that it is mentioned, because if our kids are not safe, we are not safe. No one is safe while our kids are not safe. We need to do this. This amendment needs to go ahead.

Su’a WILLIAM SIO (Labour—Māngere): Mr Chairman, I appreciate getting the call—

The CHAIRPERSON (Hon Trevor Mallard): And I might say that winking at me does not help, to the two people who did it.

Su’a WILLIAM SIO: Can I remind members that this Committee has not had the benefit of having a select committee scrutinise this bill, and therefore we have been denied the opportunity of receiving the experience and advice from that particular committee. So I am going to go through a clause by clause analysis of this amendment to add a new Part 8, and I will be asking questions of the Government, whether it has any comments to explain what it is that it is doing to address the housing crisis.

First, I draw members’ attention to the explanatory note. I do so because the Minister challenged the validity of this amendment. In the explanatory note, we find that this amendment has two purposes. The first purpose is to require the Government to increase its State housing stock by “1,000 units per year in any year that demand for State housing is not met.”, and that it be income-related rent. Secondly, it requires the Government to “make sufficient funding available to house those who are homeless and develop a plan to end homelessness.” That is what this amendment is about, and I believe it meets the primary purpose of this bill as it was introduced by the Government.

We look to new clause 11, which is common sense, and it refers to the principal Act that we are amending, the Housing Restructuring and Tenancy Matters Act. We look to new clause 12 and the introduction of new section 72A, “Income-related rent places”, and there it talks about enabling the Housing New Zealand Corporation to “increase its supply of [Housing New Zealand] housing by 1,000 per year.”

There is a real need for that. My own experience is that when we see people sleeping in cars, in overcrowded housing conditions, and in garages, it requires the Government to build more social housing. The term “income-related rent” in new section 72A is important, because in our engagement with budgeting services and with community organisations at the coalface, they tell us that, once upon a time, people renting from Housing New Zealand used to spend 25 percent or 30 percent of their income on paying rent to Housing New Zealand, but today it is 65 percent. This was revealed to me by budgeting services in Auckland, in Nelson, and in Gisborne. I am not saying that this does not exist. This does exist.

We go to new clause 13, which inserts new Part 8A, “Emergency Housing and Homelessness”, and we see there, in new section 98A, the interpretation of terms used in this part. We look at “homeless”, which means “a situation where a person meets the definition of ‘homelessness’ set out in Statistics New Zealand’s New Zealand Definition of Homelessness.”. We find that that definition says that that is when somebody has “no other options to acquire safe and secure housing”. It makes reference to people living in conditions without shelter. I suspect that these are people, like with the situation in Auckland, who are living under bridges or next to gravesides, where there is no shelter—under trees. It makes reference to people living in temporary accommodation that is not their own. It makes reference to sharing accommodation.

Let me go back to temporary accommodation. I suspect that people living in garages consider that temporary accommodation. The definition from Statistics New Zealand says that that is classed as being homeless, yet we have had Work and Income refer people to live in a garage and it says that that would be appropriate accommodation. Yet in the definition of the statistics department, it says no. We have people sharing accommodation. We have people living in uninhabitable housing.

This is people living in debilitated situations. I cannot imagine that here, in New Zealand, this Government would allow people to live in these conditions.

I refer again to the definition of homelessness given by Statistics New Zealand, which says it is where people have “no other options to acquire safe and secure housing”. I refer to new section 98B, “Joint Ministers must ensure sufficient places for emergency housing”. That makes sense. This Government has three Ministers all with housing portfolios—three Ministers. Every other Government has had only one housing Minister, and—

KANWALJIT SINGH BAKSHI (National): I move, That the question be now put.

Hon DAVID CUNLIFFE (Labour—New Lynn): I wonder whether I could make a somewhat technical contribution pointing out the structure of proposed new section 98B(2), which specifies that joint Ministers must ensure that the number of funded places available in emergency housing each year is not less than 8,000. I would also like to draw the Committee’s attention to proposed new section 72A on income-related rents, in clause 12. Again, the proposed amendment to the principal Act inserts a quantitative target of a further thousand houses a year. I would like to draw the distinction between that approach of inserting the number in the primary legislation versus inserting an enabling power to allow those numbers to be dealt with by ministerial action through an Order in Council, i.e., a regulation-making power.

I think this is an important point because, frankly, New Zealanders have given up trusting this Government. They would not want to see, in an amendment to this, a power delegated to a Minister—or indeed to Cabinet through the Order in Council process—that was not brought back to this House. Because the track record of the current Government, in failing to meet the needs of everyday New Zealanders, has been appalling.

I would like to concur with recent speakers who have said that this is not only a very practical crisis of children living in cars, enduring the cold of winter, or living in, at best, substandard, wet, damp accommodation, but a moral crisis. It is a very practical crisis. If a child is homeless, the child cannot learn. It will have lifetime proclivity to disease. It will not develop its learning abilities. Its employment opportunities will be constrained. It is much more likely to end up in the prison system or the mental health system, which in turn will be a burden on society.

The irony of the current Government, which has utterly failed to address the housing crisis but speaks in this year’s Budget of the social investment approach—is it not about time we had—

The CHAIRPERSON (Hon Trevor Mallard): Order! [Interruption] Order! The member will resume his seat. As I have indicated previously, this was a marginal call as to scope and therefore will be strictly enforced as to relevance. Members cannot wander all over the park on it.

Hon DAVID CUNLIFFE: Thank you, Mr Chair, and, Mr Chair, I take your point, which is why my comments were embedded within the quantification of proposed new sections 98B and 72A and related that, as you recall, to the question of the reliability of the policy around homelessness.

Let me touch on another section, which is proposed new section 98C, in which subsection (1) quite specifically refers to the need for a plan to end homelessness. I think the wording here is really important, because it does not talk about a plan to mitigate homelessness or a plan to reduce homelessness; it talks about a plan to end homelessness.

When combined with those rigid, quantitative requirements in the proposed amendment, as the proposed part inserts, I think the Committee can infer that this is a matter where the cost benefit of the intervention is so obvious over the lifetime of the child concerned that there is no excuse for homelessness. There is no non-zero amount of homelessness that should be acceptable or, in the language of social investment, where it is not worth investing to rid the country of it. That is why subsection (1) in proposed new section 98C talks about ending—ending, not just mitigating.

In proposed new section 98C(2)(a), we are required to “Consider whether the official definition of homelessness needs updating, and recommend accordingly.” This is the one subsection where I am not sure I am comfortable with the drafting, and that is because this Government has had a tendency to use data and the updating of methodologies to political effect—but I take it you do not want examples of that in this debate, Mr Chair. I think we all know many of them. In the following paragraph (b): “Assess [the] evidence on the current scale of homelessness, whether it is changing …”. I think the wording could also have said by how much it is changing, because it is clear to all New Zealanders that the homelessness problem is getting worse—exponentially worse—all over the country.

DAVID BENNETT (National—Hamilton East): I move, That the question be now put.

CLARE CURRAN (Labour—Dunedin South): I speak in support of Part 8, tabled in the Chamber by my colleague Phil Twyford, who has done a sterling job with his amendments to this bill. I also want to make reference to the good points that were made by Denis O’Rourke about the relevance of this part, given that there has been a challenge as to the scope of this part of this bill. He made the very good point that if people cannot afford to buy a home, then they must rent, and if they cannot afford to rent, then what are their options?

It is our contention that it is a fundamental responsibility of the State to ensure that if there are people in our society who cannot afford to rent a home, then there should be provision made for them. I want to ask the Minister in the chair tonight, the Hon Michael Woodhouse, whether or not he agrees with that concept; and if not, why not? If he does, then why was he objecting to this part of the bill, which is ensuring—new section 72A inserted by clause 12 has a provision that joint Ministers must ensure that there is sufficient funding available for income-related rent places in Housing New Zealand in any year. If there is not, then what are the options for people if they cannot afford to rent?

We have had a lot of discussion about different parts of the country. I want to take the discussion that is relevant to this part to the part that I represent, which is Dunedin—which also happens to be the part where the Minister in the chair lives—to talk about the impact on people who are not able to afford to rent, are in State housing, and currently have their rents in State housing under review, even though their income has not changed. What is happening is that those people are being rung and threatened with being moved out of their State housing, and no new State housing is being made available. In fact, quite the contrary—State housing is being sold in Dunedin.

The people who are in State housing, who still have the same low incomes, are being told that they may have to move out of State housing into a private rental market where much of it is not safe and they will meet the definition of homelessness, as put forward by Statistics New Zealand, and is mentioned in this part of the bill, because the housing is uninhabitable—in other words, slum housing, unsafe housing, housing where there are children who are getting sick and ending up in hospital with respiratory issues. The Minister knows this well.

It has been said that 40 percent of Dunedin’s housing is not warm, not dry, and needs work.

The CHAIRPERSON (Hon Trevor Mallard): Order! The same as before—please keep the debate narrow on this amendment.

CLARE CURRAN: The relevance of this to this part of the bill is that if people cannot afford to live in housing that is habitable, they are then forced into unsafe, uninhabitable housing that meets the definition of homelessness. In places like Dunedin where it is cold and damp and children are ending up in hospital and adults are ending up in hospital, what are the options? That is why this part is so important and is so critical to ensure that there is that income-related rent as the back stop in State housing, which enables more people who should not be in the private rental market in this kind of housing but should be staying in State housing to do so.

Today I received a phone call from one of my constituents begging me to intervene with Housing New Zealand because her roof leaks, there is mould, there is toxic mould in the walls, and her heating does not work because the water has run down and has affected her heating. What will Housing New Zealand do about it? Nothing. It has lost its soul, but it lost its soul because this Government has no soul. That Minister should get up—[Interruption]

The CHAIRPERSON (Hon Trevor Mallard): Order! I just want to remind the Committee that the Chair is the sole judge of time. Actually, I decide, when there is a point of order taken or if I make a ruling, how much time is added on, if any. To have members rudely interrupt other members—both sides—while they are speaking is just not going to be accepted.

Hon Christopher Finlayson: It wasn’t me.

The CHAIRPERSON (Hon Trevor Mallard): No, I know it was not. But the member was looking at me down his nose in such an outrageous manner.

MARAMA DAVIDSON (Green): First, I would like to apologise to all the members whom I have interrupted while jumping in to try to get my bit. I am really passionate about this—that is all—that is all it is. But I genuinely apologise for interrupting other members’ speeches. I do not think that is fair.

Here is a tool, a really good part, a really good change to the bill that we are debating, which will take head-on some of the most brutal impacts that are happening to New Zealanders at the moment. I am going to go through each of its parts. I have got a slight change to one of the parts of this amendment, but here is a tool that offers several different solutions that will address the immediate problem of the housing crisis and that we often talk about. We often talk about using all the tools that focus on addressing the housing crisis, but I want to say that what this amendment focuses on are the tools particularly for the group of New Zealanders who are disproportionately bearing the cruel, cruel brunt of this Government’s failure to protect them. Those are the priority tools that are outlined in this Part 8.

So it is actually not just about using all the tools; it is actually about prioritising the tools at the bottom end—that is what this part is about. The income-related rent places provision is important because at the moment people are choosing between rent, food, power, and anything else is a bonus. So this is vital to helping improve our communities. There is a part here, new section 98B set out in clause 13 in new Part 8A, “Joint Ministers must ensure sufficient places for emergency housing”. If we really want to be serious, as I keep saying, we have to look at the bottom end, at the groups who are bearing the most negative and the most harmful impacts of this Government’s failure. So I really emphasise that ensuring that the number of funded places available in emergency housing each year is not less than 8,000 is actually vital at the moment. We have heard that the provisions at the moment for emergency housing are woefully insufficient.

I come to new section 98C, set out in clause 13, “Plan to end homelessness”. I would actually just propose a slight addition before subsection (1) of section 98C. I would put something in before there. I commend the stunning work of my colleague Phil Twyford on this, but my amendment would be, firstly, to ask whether the Government members can even say the words “end homelessness”. Has anyone heard them? Has anyone actually heard them say that? I am looking around. Have we actually heard this Government vocalise or write the words “end homelessness”?

Phil Twyford: They’ve got it all under control.

MARAMA DAVIDSON: Have they? No. so I would even propose that in this part of this bill that we are debating—new section 98C, “Plan to end homeless”—that we stick a bit in just to make sure we know that they understand what we are asking: end homelessness. So it was not a long contribution that I felt I needed to make; just a clear one. Thank you.

MELISSA LEE (National): I move, That the question be now put.

A party vote was called for on the question, That the question now be put.

Ayes 63

New Zealand National 59; Māori Party 2; ACT New Zealand 1; United Future 1.

Noes 58

New Zealand Labour 32; Green Party 14; New Zealand First 12.

Motion agreed to.

The question was put that the following amendment in the name of Phil Twyford to insert new Part 8 be agreed to.

Part 8

Amendment to Housing Restructuring and Tenancy Matters Act 1992

11 Principal Act

This part amends the Housing Restructuring and Tenancy matters Act 1992.

12 New Section 72A

After section 72 insert:

72A Income-related rent places

The joint Ministers must ensure sufficient funding is available for income-related rent places in HNZ housing that, in any year where the amount of social housing stock is insufficient to meet the demand for social housing, would enable the Corporation to increase its supply of HNZ housing by 1,000 per year.

13 New Part 8A

After section 98 insert:

Part 8A

Emergency Housing and Homelessness

98A Interpretation of terms used in this part

In this Part, unless the context otherwise requires,—

homeless means a situation where a person meets the definition of homelessness set out in Statistics New Zealand’s New Zealand Definition of Homelessness.

emergency housing means any premises that are let for occupation by any person as a place of residence for persons who are homeless (whether or not the premises are owned by the provider or by any other person).

98B Joint Ministers must ensure sufficient places for emergency housing

The joint Ministers have responsibility for ensuring that all people who are homeless have the ability to access accommodation and the services they need.

The joint Ministers must ensure the number of funded places available in emergency housing each year is not less than 8,000.

The joint Ministers must ensure any places funded for emergency housing are for places which are warm, dry, and safe.

98C Plan to end homelessness

The joint Ministers must within 12 months of the commencement of this section table before the House of Representatives a plan to end homelessness.

In the development of the plan under subsection (1) the Minister must:

Consider whether the official definition of homelessness needs updating, and recommend accordingly.

Assess the evidence on the current scale of homelessness, whether it is changing and how, and what the causes of that change might be.

Evaluate possible policy responses to homelessness, including international best practice, and recommend accordingly.

Consider how homelessness is experienced by different groups in society and evaluate policy responses that respond to that experience. For example, Māori experience of homelessness and Māori-led initiatives to respond.

Hear public submissions and expert evidence, particularly from those directly affected by homelessness and their advocates.

A party vote was called for on the question, That the amendment be agreed to.

Ayes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Noes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

A party vote was called for on the question, That the question be now put.

Ayes 63

New Zealand National 59; Māori Party 2; ACT New Zealand 1; United Future 1.

Noes 58

New Zealand Labour 32; Green Party 14; New Zealand First 12.

Motion agreed to.

Amendment not agreed to.

Clauses 1 and 2

CHRIS HIPKINS (Labour—Rimutaka): I am happy to take the first call on this—

The CHAIRPERSON (Hon Trevor Mallard): As long as the member puts his collar down.

CHRIS HIPKINS: Happy to dress myself properly.

Hon Members: The jacket collar.

CHRIS HIPKINS: Oh, the jacket collar. Thank you for your sartorial advice, Mr Chairperson. I am very happy to take this, the first call in the summing-up debate on what has been a significant discussion on issues related to housing, and we thank the Government for the opportunity to do so.

In the summing-up debate, of course, we debate the title and the commencement of this bill. I actually think that there is a different title for this bill. Perhaps we should call it the “Hasher Bill” or, in Nick Smith’s case, the “Hash-up Bill”, because just about everything that the Government does around housing is a hash-up. We have seen that today and yesterday and the day before—in fact, it has been ongoing for some time.

But what is interesting about this particular debate on this particular series of amendments that the Labour Party members have put forward is that although the Government members have no ideas of their own on how to deal with the housing crisis that New Zealand faces, they have voted against every single amendment and every single proposal put forward by the Opposition that would actually deal with the substantial housing issues that New Zealand faces.

But I want to turn in particular to the debate that we had on Part 2 of this bill, because, if anything, that demonstrates why this should be called the “Hash-up Bill” or the “Hasher Bill”. The Government told us all the way through that debate—all the way through, right to the bitter end of that debate on the changes to property rights—that it was not, in fact, changing anything. But let us be really clear. I want to know, because we have been researching this—and this is something that we would have raised during that part of the debate had it not been under urgency and had we actually had the time to consider it properly—about some advice provided to the previous Labour Government when it was preparing a national policy statement. The advice was very clear on offer-back provisions, in which it said that “The existing legislation does not provide an exception where the disposal [of the land] itself is part of the public work.”—i.e., a housing development. “This has significant implications for sustainable urban development projects which aim to create well-serviced parcels of land to sell to an end-user (e.g. a developer, an owner-occupier, or an institutional investor in affordable rental housing).”

In other words, the advice that the Government gave this House all the way through the Committee stage on Part 2 of this bill was wrong because it was inconsistent with the advice that previous Governments had been given, and yet there has been no change to that part of the law. So how is it that a previous Government could have been advised that the existing legislation did not provide exceptions when it came to the disposal of land as part of a public work—i.e., a housing development—and was provided with clear advice that that had implications for urban development and that the law would probably need to be changed, and yet the Government today said that that was not the case?

So I would like the Minister to take this opportunity, in the closing stages of the debate, to clarify exactly why the advice seems to be different now to what it was previously, although the law has not changed. I am looking forward to the Minister’s contribution to that because if the position previously—and I want to go through it again, where it says: “This has significant implications for sustainable urban development projects which aim to create well-serviced parcels of land to sell to an end-user (e.g. a developer, an owner-occupier, or an institutional investor in affordable rental housing).” If that was the case then, why is that not the case now? I would like the Minister to answer that.

The Government, basically, has pulled the wool over the House’s eyes by trying to say that “This bill does not actually change anything, and yet it is essential.” Those two things are actually contradictory. Either it is essential and it changes something, or it does not change anything and, therefore, it is not essential. So which is it? It cannot be both. It cannot be so urgent that the Government must push it through to avoid the potential that there will be litigation as a result of this loophole being identified, and yet it says that, actually, there is no loophole.

The Government is trying to run both arguments simultaneously and it did that all the way through the Part 2 debate, and yet we have now got clear evidence that the advice that it was giving the House is not true. Why did this bill not go to a select committee, where that could have been properly teased out? The Government could not answer that and it did not make any attempt to answer that. I am asking for the Government to now provide the explanations that it should have provided earlier on, because it has not done so, so far.

Perhaps in the Government’s summing-up in this debate and in the Minister’s contributions, he might like to also explain why those members voted against eight proposals—eight concrete proposals—that would have dealt with many of the issues that New Zealanders face when it comes to housing. Government members and the Government party chose to vote against all of them, and I would very much like to hear more of that contribution.

But the offer-back provisions—and I want to talk about this. This was not an issue that we had the opportunity to canvass, because the information was not available at the time. So I want to quote again from the advice that the previous Government received: “Any land acquired for an urban development project or existing council or government-owned land within that project is likely to be sold. So even if it could be argued that a particular site should be compulsorily acquired for an urban renewal project, the offer-back obligation may still complicate matters when it comes time to sell the land.”

So, again, I put that to the Minister: if that was the position under the previous Government and the law in this area has not changed since then, why is the advice the Minister is giving the House now so different to the advice that the Government of the day back then received? This is what the whole issue, and the whole, I guess, length of this debate, has been driven by. It is a concern that Parliament, under urgency, without any consultation with the public, is changing people’s property rights and they are not getting a chance to have a say on it. That is actually a very significant thing for any Parliament to do under urgency—to change people’s property rights—but not only to change them for now and for the future but to change them retrospectively, which is what this legislation has done.

So I hope that the Minister will take this opportunity to give us a detailed explanation as to why a position that was long standing, where the law had not changed, somehow has miraculously changed and the advice is now different. I look forward to that contribution from the Minister.

Hon Dr NICK SMITH (Minister for Building and Housing): I understand we are debating the title and the commencement, but as a matter of courtesy to the member Chris Hipkins, I want to make two crisp points in respect of his question. His question was: has the law changed? The answer is yes, it did. In the Housing Amendment Act that was passed by this Parliament in February of this year, the very same provisions that are affected in this bill were in the Social Housing Reform (Transaction Mandate) Bill, which went to the Social Services Committee. I would draw his attention to the minority view from his own colleagues, who chose to make absolutely no mention of the change or of any concern about it. So it is ironic for members to be giving all this bluster and concern about a provision in respect of the Housing Act and its interaction with the Public Works Act when it was of absolutely no concern to Labour members earlier in the year.

The second point I would like to make is that I would like to table a very specific email that was provided in respect of the development of this bill, and I will quote it word for word from Treasury’s regulatory impact statement unit, which is required to report on all bills. It says this: “The minor avoidance of doubt provision in the Housing Act”—the one that the member has just claimed is so significant and is of such moment; let us hear what it says—“does not need a RIS. It is minor and does not change any rights.” Let me say that again. This is the independent Treasury unit, and it simply goes on and says: “It is simply a clarification of existing legislative intent.” I am going to read the words again: “It is minor and does not change any rights.” [Interruption]

The members ask a fair question: “Well, why is it important that there is clarity in the law?”. I will tell you why that is important. Right now, the Government is negotiating significant contracts for tens of millions of dollars to develop housing on blocks of Crown land across Auckland. I think there is broad agreement that that is actually a good thing to do. And in the negotiation of those contracts involving tens of millions of dollars of private investment—and, remember, these are blocks of land the Government owns, and so we are able to put definitive requirements about both social housing and affordable housing. Because we own them, we can say that you must do these things.

It is absolutely important for those investors that they have the certainty, without any uncertainty at all, over someone potentially challenging them. I actually think that if members reflect on that—if you were a major housing company, you would want absolute certainty in that area. That is the sole reason that those provisions are in this bill, and it is why, actually, if this Parliament is committed to getting more houses built in Auckland at pace, that certainty is required.

METIRIA TUREI (Co-Leader—Green): I think we have had the clarification now from the Minister for Building and Housing, Nick Smith, where he has just now—

Hon Dr Nick Smith: I apologise to the member. I seek leave to table the email dated 3 August from the Treasury regulatory impact statement that makes that very clear statement that it is minor—

The CHAIRPERSON (Hon Trevor Mallard): No, no, that is all you need. Is there any objection to that? There is objection.

METIRIA TUREI: So I just want to—

The CHAIRPERSON (Hon Trevor Mallard): Order! Sorry, we will start the whole speech again in a second. I am going to ask the member to reconsider. Members of the House have asked for that evidence to be tabled on repeated occasions. I think it ill behoves the Committee to refuse to have something tabled that is not anywhere otherwise available and has been asked for by a number of members from at least two parties. I am going to ask the member to reconsider his objection.

Denis O’Rourke: Speaking to that, Mr Chair, the reason that I have objected is that on numerous occasions exactly the same situation has occurred when New Zealand First has sought to table material that would be just as valuable to the House as a whole and has been requested by members of New Zealand First and sometimes by others, and for no reason at all a member on the other side of the House—

The CHAIRPERSON (Hon Trevor Mallard): OK. It is all right. The member has a right to object. There is no reasonableness test.

METIRIA TUREI: The Minister has, as I understand it, just confirmed to the Committee and the public that in his initial negotiations over Crown land that he, in his wisdom, decided ought to be used by developers for the purposes of building housing, he failed, at that point, to ensure the legal certainty of the use of that land. That was his failure. I do not know what he said to those developers about the legal certainty of the use of that land or the status of that land in terms of the offer back. But what is clear from what he just said is that when he provided access to that land for building, signed the deals for the use of that land, watched as developers spent hundreds of thousands of dollars developing that land, he could not give them any legal certainty about whether they could continue to use and on-sell it. So what he is asking from us now is to clean up that mess he created in his failed negotiations.

I wonder then whether the supposed legal risk is actually coming not from original owners of the offer-back provisions that he is taking away but from the developers themselves, because the developers themselves, as he has just confirmed, do not have legal certainty over the land on which they have now invested possibly hundreds of millions of dollars in building, infrastructure, resource consents, and all of those things. So is that, Minister, the reason why Part 2 is included in this bill—not because of a risk from the original owners who would otherwise be entitled to an offer-back provision under that land, but from the developers themselves, whom he has done deals with knowing he could not give them legal certainty? That is what it sounds like to me, especially given this Minister will not go into any further detail about the nature of that legal risk. In the Cabinet papers it is the detailed description of that legal risk that is redacted, and it is the only part of the Cabinet paper that is redacted—where it looks like it goes into describing the legal risk in some detail.

I think that if he has a particular legal problem to deal with as a result of his failure to provide legal certainty to developers from the first instance, then that may be a legitimate concern to bring to this House under urgency. It may well be. There may be a circumstance where he would talk to us about this in some detail so we understood the full story. Things do go wrong. Ministers make mistakes. This is the sort of thing that happens. The provision that we would expect him to build in the law would be specific to that particular legal problem, not as broad-brushed as this current provision is, which will remove for every possible original owner and their descendants their right to an offer back for any land that was given for State housing across the country—it does not matter whether it is in Auckland or for special housing areas. This provision is so broad that there could be hundreds, if not thousands, of original owners whose rights are being taken away. That is what he has created here when he could have more clearly identified the legal risk, come and spoken to the Opposition MPs about the nature of it, and we could have found a more effective and targeted way of dealing with that risk.

I have been here a long time—and others have been here a long time too. We know there are times when you engage in very specific detailed conversations—highly confidential conversations—with Ministers about some of these kinds of legal and financial issues. All of us who have been here for a while have been involved in something like that to some extent, at some point. There is an ability for Ministers to work with Opposition MPs to find credible and sensible ways through tricky legal problems and—often—tricky financial problems that are created through a genuine mistake. In those circumstances I, as co-leader of the Green Party, am more than happy to work with Ministers to find effective, logical, rational, careful means through those problems. But that is not what happened here. What happened here was that a bill was put forward under urgency. A very short briefing was provided.

KRIS FAAFOI (Labour—Mana): I am going to start on clause 2, which is the commencement date, and the line in the bill as it states now says: “This Act comes into force on 15 September 2016.” To those people who may be listening on the radio or watching on Parliament TV that is 8 days away, but in the twilight zone that Nick Smith has thrust us into that is 9 days away. I can understand that the Minister will want this piece of legislation to come into force on 15 September when it comes to Part 1 and extending the housing accords and special housing areas, because if we do not do that, there is some risk for developers who have got plans already in train. But what I do not understand is why we have to have this Part 2 come into force in 8 days’ time.

We were told during the debate around Part 2 by Jono Naylor—I think he was the only National Party MP to stand up and take a call during Part 2—that this “is not a significant change”. So if it is not a significant change and we are passing this bill through to make sure that Part 1 gets through in time, why are we making sure that we are rushing through with Part 2? Why are we not having a select committee process where people who may have had rights affected by Part 2 can have their say? None of that makes sense to me. I will give to the Minister that Part 1 makes sense, because time was running out on that, but why Part 2?

As co-leader of the Greens Metiria Turei has just pointed out, we have got some suspicions around that. We have waited for some time; I think we were definitely debating Part 1 or Part 2 of this bill at this time last night, and we were wondering why this had to go through under urgency. We may have thought it was de-risking the Government from any liability, or de-risking somebody who may have bought a State house from any liability, too, but the Minister has come to the Committee now and said: “Well, it’s not de-risking those two classes of people; it’s de-risking the developers who are interested in getting their hands on the land that could be sold to them to develop.” That was not necessarily the story that we got 24 hours ago. It really does open up exactly why this is not getting the select committee scrutiny that it deserves.

To give that some local context from my area, we have got an empty patch of land in the Castor Loop that the Minister’s Government has done nothing with over the last 4 years. It has sat vacant—

The CHAIRPERSON (Hon Trevor Mallard): Right. I am going to remind the member that although the debate was slightly extended—and while the member was replying to the honourable Minister’s comments he was OK—the title debate is a relatively narrow debate.

KRIS FAAFOI: Yes. As to why we are passing Part 2 under urgency for 15 September 2016, I would like to know why, in the context of all of this, a Government that has sat on a piece of land for 4 years passes this piece of legislation under urgency. Essentially, what Part 2 of this bill would allow it to do is to not care about who may have sold that piece of land to it under the Public Works Act. It could sell it to anyone it likes. That is not what that community wants. I would like to acknowledge my other colleague from Mana, Jan Logie, who knows what that community wants. It does not want an empty piece of land. It wants the houses that it was promised were going to be built for it when the other ones were demolished. That is a commitment that was made by this Government but was not followed through on. The reality of what Part 2 does here is that that land now can be sold—de-risked for the developers, so there will be no issues for them.

The CHAIRPERSON (Lindsay Tisch): I am going to call—how about Jan Logie?

JAN LOGIE (Green): Honestly, Mr Chair, I have been trying so many times tonight, and I have prepared so many speeches, that I really hope you allow me a little bit of leniency to give my six speeches that I have written on this title and commencement debate. This is a relief.

The misnamed Housing Legislation Amendment Bill—thank God, I have got a chance to speak. It is a misnamed bill because a Housing Legislation Amendment Bill, in the context that we are living in, in these days, in a generally acknowledged housing crisis—you would expect a Housing Legislation Amendment Bill to deliver more housing. Despite what this Minister says this bill is going to do, we really have no evidence that it is going to do that.

We have been told that this is about supply and that it is about affordability, but when the first tranche of this legislation was introduced 3 years ago—again, under urgency—the average house price in Auckland was about $730,000. We were told this bill was going through under urgency. We were pushing through these proposals that would override council decision-making and control of land use in their communities because we had to prevent the possibility that the average house price in Auckland might get to $1 million within 3 or 4 years. Ha, ha! Well, it turns out that this proposal and this method that we are extending around the country sped that process up to the quickest tranche that we thought was possible back then.

This is absolutely a failed initiative, for which this Government is again using urgency to roll-out in an extended way around the country. I think it has delivered maybe—if I address now the supply aspect—1,300 houses, I understand, over 3 years. Actually, you have got to think that maybe the market could have delivered that by itself. I am no fan of the market, so I really wonder whether this is the Government’s concept of intervention, of taking control and delivering for the people, because if it is, it is half-arsed. I would propose that as a better name for this bill than the Housing Legislation Amendment Bill.

I would like to say that it is particularly important to note that 1,300 houses have been delivered, while the Government has sold off 2,500 Housing New Zealand houses since 2011. So maybe this bill should be renamed the “Let’s Go Backwards Bill”. The Government’s housing agenda maybe is to put everyone on the streets. Maybe it is not enough that just 1 percent of the population, or over 1 percent of the population now, is homeless. Maybe the Government wants it to be more.

Or maybe, judging how this Government has voted on all of the brilliant, I might say, proposals that have been put forward by the members on this side of the Chamber, this could be called the “We Don’t Really Care Bill”. Actually, the Government wants to put up this tinkering thing, to pretend that it is doing something, but when it is given something substantive—like building more houses, like putting a plan in place, like ensuring emergency housing is available, like intervening to address inequality and the absolute rort of investment that is happening in our housing market, which is locking people out of the market—then it is “Well, we really don’t care. We don’t want to do any of those things.”

The Government says: “Don’t give us the regulatory impact statements because there is no detail.” This is apparent; I think I understand that the legislation has been developed in 6 weeks, whereas the proposals that have been put forward from this side of the Chamber—some of them have been considered through a select committee process that, of course, National did not want to participate in. Some of them have actually been through a select committee process. Some of them have actually been properly worked out and the details are very public. But the Government says no, and that we are being hypocritical in challenging it on not providing us with the information. But it is OK. The Government will ignore all of our information and all New Zealanders’ comments on this issue.

I do want to speak just a little bit to the Housing New Zealand decision to not return the dividend to Housing New Zealand.

PHIL TWYFORD (Labour—Te Atatū): I want to thank the Minister for allowing us to have this debate. It is the best debate on housing that I can remember in 8 years in this House. I think it has been very illuminating, actually, because in this Housing Legislation Amendment Bill debate there are two contrasting approaches.

The first is one very narrow policy approach based on the idea of drawing some lines on a map and declaring these to be fast-tracked consenting zones. That, in essence, is the Minister’s special housing areas policy. That has been the main solution that he has offered up to a housing crisis that now grips the country and has given us the most unaffordable housing in the world. It is based on the idea that the problem, the cause of the housing crisis, is slow consenting by councils, and I think that if it is not clear to you by now that that is not in fact the root cause of the housing crisis, then you—and I do not mean you, Mr Chairman—have not been paying attention. If the slow rate of council consenting was the cause of the housing crisis, then the special housing areas would have made a much bigger difference in the 3 years since the Minister unveiled that policy.

In the debate we have had this afternoon, Nick Smith’s special housing areas have been contrasted with a broad and deep reform agenda backed by the Opposition parties in this House, who will form the next Government.

We proposed to this Committee the building of 100,000 affordable homes for first-home buyers, and National voted against that. National and ACT voted against that. We proposed taxing speculators, and National voted against that. We proposed banning non-resident foreign buyers from buying existing houses. National voted against that. We proposed a bold and radical new approach to managing urban growth to reduce the cost of urban land and produce more competitive urban land markets that would lower the cost of housing, and National voted against that. We proposed to change the law to stop the Government from using our public housing organisation as a cash cow in the way that is has—withdrawing half a billion dollars out of Housing New Zealand in the middle of a housing crisis—and National voted against that. We proposed to this Committee a comprehensive approach to strengthening the system of emergency housing, because on this side of the Chamber we believe it is totally unacceptable for kids in this country to be growing up in cars and caravan parks, but National and its subsidiary brand Act have voted against every single one of those proposals.

But the reason that Nick Smith brought us here in the last 36 hours to debate this bill is that he wants to roll over his special housing areas. A measure that he described 3 years ago as an interim measure—he has asked us to roll that over for another 3 years. We agreed to that because we did not want to inconvenience the eight developers who otherwise would suffer because of Nick Smith’s incompetence, because he failed to anticipate the transition issues associated with the demise of the special housing areas.

So there are two very contrasting approaches to dealing with this housing crisis. I want to argue that the broad, systemic approach that is embodied in the range of housing reform proposals that we have debated here this afternoon is appropriate. It is appropriate because the housing market is a system. It is an economic system that involves the Government, councils, landowners, developers, builders, homeowners, and renters. It is a complex system that lies at the heart of the well-being of our people, our families, our communities, and our economic prosperity as a nation, but it is broken. It requires a deep, systemic approach to fix it, and it is only the policies of the parties on this side of the Chamber that offer that. People have a deep, basic need for shelter—for good-quality, affordable, and accessible housing. They are not getting that under this Minister for Building and Housing and this National Government. It is time for a change.

DENIS O’ROURKE (NZ First): I want to begin by commenting on the Minister’s speech given just a few minutes ago, concerning his belief that this is just a clarification of the law and not a law change. Nothing could be further from the truth. The reality is this: clause 10 does use the words “To avoid doubt”, but that does not make it true. In fact, that term is superfluous and inappropriate, because the clause does not just clarify, it actually makes a substantial addition, and it does so retrospectively. I can prove this, because the current section 15 says only this: “Subject as hereafter provided in this Act, any State housing land and any buildings and chattels held for State housing purposes may be disposed of by way of sale, lease, or tenancy by the Corporation.” Only the first few words of clause 10 are repeated in section 15 as it now is, but the words added are: “if the land is disposed of as 1” of four specified categories of land, which are listed.

The term “State housing land” means, in section 2 of the Housing Act: “land that is for the time being held or set apart for State housing purposes; and includes land that at any material date was held or set apart for the purposes of Part 1 of the Housing Act 1919”. The term “State housing purposes” has a very long definition in section 2 of that Act—too long for me to quote here, but it has three land categories that are quite different from those that are stated in this bill. Look at them for yourself and you will see that I am right. Yet, strangely, it is section 15 that is being amended, not the definition in section 2 of the Housing Act. What does that mean? It means that that definition still remains. So how will that sit with the new section 15(2)? I say that it creates uncertainty. I say that it needs to go to a select committee because the select committee would sort out these sorts of things, and that is exactly what is not happening as a result of this process. So I say to the Minister: you may feel that this is just a clarification, but if you look carefully at what the bill actually does, you can see without any possible doubt that it is a substantial law change.

I want to go on to say this about the title—because that is really what we should be talking about here, and we should not be sidetracked by misinformation from the Minister. The short title that I would suggest is one that would be far more descriptive than the one that is there. It cannot be short, because this bill covers two completely different things, in my opinion, so I would suggest the title should be: “Ensuring continuation of failed Government policies in the hope it can find a way to make them work, and ensuring that Government panic measures relating to the fast-track sale of State housing land prevail over the rights of people who have rights to offer back.” That would actually describe what the bill is about. So why not have something like that? It may be very long, but it has to be long if it is actually going to inform people what this bill is about. Of course, the Government, I think, does not really want to inform people what it is about—it should.

Let us take that name that I have suggested bit by bit: continuation of special housing areas—they were originally 3 years, now to be 6. Have they failed? Yes, they have—1,300 houses over 3 years, and the other statistics that are available show the same thing. So that is the evidence that they have failed, and the reason they have failed is that the Government refuses to directly invest in housing land adequately for the purposes of those special housing areas. That is New Zealand First policy, and that is what should be done by this Government, but it is not doing so.

The second part of the suggested title—it is a panic measure, because here we are under urgency, with no select committee scrutiny, and the Government ought to have a good reason to change the law but what we have got is a very loud silence. And in the process, what we have is people’s rights being trodden on—rights that they should have for offer-back. That is a tragedy for law and order in this country. The Government should actually be protecting people’s rights, not removing them without any adequate reason being given.

MELISSA LEE (National): I move, That the question be now put.

The CHAIRPERSON (Lindsay Tisch): No, I am going to hear from Iain Lees-Galloway.

IAIN LEES-GALLOWAY (Labour—Palmerston North): Wonders never cease, Mr Chairman. Thank you very much for the call. I would like to speak to the title of this bill. I tried to find the direct quote—I could not find it, but Sir Geoffrey Palmer once said something along the lines of “Titles of bills should be succinct and, as clearly as possible, articulate what the bill does.” So when looking at the purpose of this bill, I wondered why the title of this bill is not the “Housing Supply and Affordability Bill”, because that is what this bill purports to do. It purports to improve both the supply and the affordability of housing. So let us look through the bill and see whether or not it meets its purpose, and whether or not that title would have been a more appropriate title for the legislation.

Does this bill improve the supply of housing? Well, maybe a little bit—not a lot, but a little bit. By extending the provision of special housing areas and having the fast track provisions that go with special housing areas, perhaps there will be some improvement in the supply of housing. Not all of that housing will be affordable. In fact, there is very little provision to make sure that the housing is affordable. There is nothing to stop houses in special housing areas being flicked on by the purchasers of those houses after 2 years for untaxed capital gain, so that makes no difference to the affordability of housing. But nevertheless, the period in which special housing areas can be created is extended by this legislation. There may be some insignificant but nevertheless noticeable change to the supply of housing—not nearly enough to actually deal with the housing crisis, but, nevertheless, a change to supply.

The next question is: does the legislation deal with the affordability of housing? There is nothing in the legislation as it is now. Having gone through all the various parts and the debate that we have had, there is nothing in Parts 1 and 2, which remain intact in the legislation, that actually changes the affordability of housing. The minuscule changes to supply that are allowed for in Part 1 of the legislation will have no impact on affordability at all, and Part 2 has nothing to do with the affordability of housing whatsoever.

What would have had an impact on the affordability of housing were the various other parts that we have debated over the last day and a half. New Part 3, which was proposed, would have introduced, essentially, Labour’s KiwiBuild policy to build 10,000 homes a year—10,000 affordable homes—and put some parameters around what affordable homes look like. That would have had a significant impact on affordability. The parts to do with foreign investment in our property market, and the various other parts that were proposed by members on this side of the Chamber, would all have had a real impact on the affordability of housing, not just in Auckland but in other parts of the country as well. I recall, actually, an amendment that Metiria Turei offered to Part 1 of this legislation. It also would have added a definition of what an affordable house was and would have required special housing areas to have a particular proportion of affordable houses.

All of those changes were offered by Opposition parties and Opposition members. All the things that would actually have made this bill a housing supply and affordability bill were offered by members of the Opposition, and all of them were voted down by the Government. It is a bit rich to hear the Minister for Building and Housing and members of the Government say that members of the Opposition have come to the Committee and played games with this legislation, or that members of the Opposition have come to this Committee and voted against provisions that would have improved the affordability of housing. Actually, we voted in favour of the provision that would have improved supply and we offered all of the things that would have improved affordability, and it was the Government that voted them all down. So I am going to speak in favour of the Housing Legislation Amendment Bill title, because it tells us absolutely nothing and this bill does nothing. Indeed, it amends housing legislation, but it does sweet bugger all else. So let us stick with the title of Housing Legislation Amendment Bill.

CATHERINE DELAHUNTY (Green): I would like to take a particularly short call on the title, following on from my colleague Iain Lees-Galloway’s dissertation. I have just got some better options for the title, OK. They are the “Especially Complicated and Notably Useless Housing Bill”, the “Elephant is Still in the Room (But At Least the Elephant Has Got a Room) Bill”, the “Affordable Housing for Affordable People (Everyone Else Get a Cardboard Box) Bill”, the “Nail in the National Government Coffin Bill”, the “Halfway House to Nowhere Very Much Bill”, and the “We Have Abandoned You (Love Doesn’t Live Here Any More) Bill”.

Hon Member: I like that one.

CATHERINE DELAHUNTY: I like that one, too, because it is slightly melodramatic but it is deeply true. As the Guardian said, the whole world is watching. The National Government has abandoned the people that it is supposed to represent. Love does not live here any more.

I would also like, just before I finish this, to refer to the moral tale in our Pākehā history of the three little pigs. Remember the pig that built its house out of straw, and then the wolf came along? Well, that is what the Government is offering in this. It is offering a straw man, or a straw house, or a straw whatever. The big bad wolf of the collapse of the market will come along. The big bad wolf has already blown away the life of many people in terms of having a home. They already got no straw, no bricks, no whatever else—no timber. This bill does not provide anything except straw. It is not good enough.

The title needs to be changed. Pick whichever title you would like, but I just have to say to the people out there who are watching that although the National Government has abandoned you, love does live here on one side of this House. We will keep working for affordable housing.

Thank you very much. This might be a frivolous contribution, but my heart has been in this process, along with everyone else’s. Thank you to everyone who put up a constructive solution to actually make this piece of legislation worth having. The fact that the Government members voted it all down—let that be on their own consciences. “The whole world is watching” notes the Guardian. Good night.

JONO NAYLOR (National): I move, That the question be now put.

A party vote was called for on the question, That clause 1 be agreed to.

Ayes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Noes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Clause 1 agreed to.

The question was put that the following amendment in the name of Phil Twyford to clause 2 be agreed to:

replace this clause with the following new clause:

2 Commencement

(1) Part 1 comes into force on 15 September 2016.

(2) Part 2 comes into force on 15 December 2016.

A party vote was called for on the question, That the amendment be agreed to.

Ayes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Noes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Amendment not agreed to.

A party vote was called for on the question, That clause 2 be agreed to.

Ayes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Noes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Clause 2 agreed to.

PHIL TWYFORD (Labour—Te Atatū): I raise a point of order, Mr Chairperson. I wanted to move Supplementary Order Paper 212 dividing the bill.

The CHAIRPERSON (Lindsay Tisch): Well, it is too late.

Phil Twyford: Is it? OK. I missed my moment.

The CHAIRPERSON (Lindsay Tisch): You missed your moment, yes. And I did wait.

House resumed.

Bill reported with amendment.

Report adopted.

Third Reading

Hon Dr NICK SMITH (Minister for Building and Housing): I move, That the Housing Legislation Amendment Bill be now read a third time. This amendment bill will get more houses built. This bill will get houses built more quickly, and it should be getting the full support of this Parliament. It will do so by ensuring a smooth transition to the Auckland Unitary Plan. It will do so by allowing more land to be available for housing more quickly in other parts of New Zealand, and it will do so by providing certainty over the Crown land housing development programme. The parties opposing this bill have actually shown that they are far more interested in wallowing in the stories of hardship over housing than actually getting more roofs built over the heads of Kiwi families. The greatest irony is that Labour has called for a state of emergency across New Zealand, over housing, but it opposed urgency in this House for the very bill that will make a difference.

Let us be clear about three things in respect of housing. The first is on the demand side. It is at record levels because New Zealand is doing well. Our economy is growing strongly, unemployment is low and falling, we are a safe and well-governed country, and interest rates are at the lowest level in 60 years, so housing demand is at record levels.

The second is that construction is booming. Statistics New Zealand has just reported the highest level of building activity ever in New Zealand, topping $18 billion in the last year. Residential building has grown nationally by 20 percent per annum for every one of the last 5 years. I have checked the records all the way back to 1922, and there has never been such a period of long, sustained growth. Independent reports show we are on track for this boom to continue until 2021. In Auckland we are on schedule to build the equivalent of a Whangarei in Auckland in this term of Parliament, and another Whangarei in the next term of Parliament.

My third point is that land-use policy is the single most important public policy issue affecting housing supply and affordability. The Productivity Commission says so, Treasury says so, and the OECD says so. We also know it from our own experience in Christchurch, where we are using the special earthquake provision powers and freeing up land. We have a well-functioning market. Thousands of good, new homes with three bedrooms are available on the market at $450,000. We have got house price inflation in Christchurch of only 2 or 3 percent, and we have had rents in that market drop by 8 percent over the last year.

Let me turn to the detail of this bill. It will allow eight greenfield special housing areas, totalling 762 hectares in Auckland, which are well advanced in the planning and design processes, to enable 7,900 homes to be built. This is significant. It amounts to $4 billion of additional housing investment that will be able to be facilitated to ensure it progresses. The simple question for Parliament is this: do we want to send those eight developments, $4 billion of housing, back to square one? Members on this side of the House say that no, we do not. Members opposite, who have voted against this bill, are voting to block those housing developments.

The bill also allows the extension for 3 years of the Housing Accords and Special Housing Areas Act in other parts of New Zealand. The original Act was very focused on Auckland, but the growth pressures are now being felt more widely. The National Policy Statement on Urban Development will take time for councils to free up land. That national policy statement requires that to be done over 3 years, and so it makes sense for the special housing areas to be able to be used in the interim, to be able to free up more land. These measures are supported by Local Government New Zealand. I have received letters from a number of councils that want access to this flexible tool.

The second part of this bill is the part that Labour has got in a lather about. The amendment makes plain what is already in the 1955 Housing Act: that the Government can approve housing development schemes and sell the houses. It is what Government has been doing for years. It is what we are doing in Hobsonville, where over 1,000 houses have now been completed. Ironically, it is what we have done in Weymouth, where Mr Little visited and said that we should be doing more of those types of schemes. Labour has caused this huge commotion in the House, saying that these are very significant changes that affect people’s property rights.

Let me read exactly what Treasury’s independent regulatory impact unit said on these changes, long before this controversy, in an email dated 3 October. I will quote word for word: “The minor avoidance of doubt provision in the Housing Act doesn’t need a regulatory impact statement. It is minor, and it doesn’t change any rights. It is simply a clarification of existing legislative intent.” Let me quote it again: “It is minor, and it doesn’t change any rights.” So there it is, without political spin, straight from a Government official. It is why the Government is wanting to make the change. It is to provide certainty for business.

We are wanting to get on and sign contracts for significant developments of land, and, understandably, if we are going to get the best deal for the taxpayer and the most houses, we need to get certainty in the law. If there is something that members on this side of the House understand, it is that certainty is everything for businesses, particularly when they are going to be investing tens and hundreds of millions of dollars in building the houses that this country needs.

People who are wanting to delay this minor clarification of the law are actually wanting to make it harder for the Government to get on and build houses on vacant public land. Remember, it is on these vacant blocks of public land that the Government is able to put quite tough requirements to ensure the houses that are being built are in the medium price range, and also to deliver at least 20 percent of social housing. The greatest irony is this: for all the debate over the last 2 days, I have not heard a single cogent argument against any of the three provisions. Here is the irony: Labour members are out there saying that Labour is going to build tens of thousands of houses, under its KiwiBuild policy, on vacant Crown land. Are they saying that when they have built those houses, they are going to offer them to the former landowners and not to ordinary New Zealanders? If Labour really believes its opposition to this bill, it will promise to repeal it. It will not, because its members know in their heart of hearts that it is the practical measures that are required to ensure this country gets on and builds as many houses as is practicably possible.

This bill is a sensible measure. It sits alongside our Resource Management Act reforms, the work to develop an urban development authority, changes to the Building Act, and changes to the Unit Titles Act, because there is not a single magic bullet to this housing challenge. We need to do a whole lot of things well, and this bill is part of what will make the difference and ensure that we maintain that record growth of housing construction in New Zealand.

PHIL TWYFORD (Labour—Te Atatū): It is almost all over, Nick. It is almost over. This debate has been, I think, a microcosm of the housing debate that New Zealand has been having for the last couple of years. At the centre is an incompetent Minister for Building and Housing, who has, for the last 17 hours, embarrassed and infuriated his colleagues. He has subjected them to a humiliation in this House, as what the Minister promised would be a small, inconsequential clarification has turned into a marathon 17-hour debate that has shown National’s housing policy to be limited, inadequate, narrow in focus, and inconsequential. It has been put up against—quite unfairly, really—a bold, comprehensive housing reform agenda backed by the Opposition parties in this House, and even some of the Government support partners from time to time, which have a vision to transform the housing crisis that this National Government has got us into.

The bill in question is also a bit of a microcosm of this Government’s housing policy—

Grant Robertson: It’s chaos.

PHIL TWYFORD: —and the way, the chaotic way, that Nick Smith discharges his responsibilities as housing Minister. One of the two parts epitomises the sort of microscopic tinkering that has come to be the hallmark of this Government’s housing policy. It is the extension, by 3 years, of the special housing areas policy that Nick Smith described 3 years ago as an interim measure while the Government’s long-term affordable housing strategies bedded in. Well, we have spent much of the last 17 hours debating the extension of this so-called interim measure—the special housing areas—which have demonstrably had marginal positive effect in the last 3 years in our country’s biggest city, where the 42,000 shortfall of dwellings that has accumulated under this National Government is getting worse by 4,000 every year. What has Nick Smith’s centrepiece policy achieved? An additional 1,300 dwellings over 3 years, with no evidence that those houses would not have been built if the special housing areas policy had not been in place. All it has done is bring forward some houses that the market would otherwise have built of its own accord.

The second part of the bill epitomises the shonky, incompetent discharge of ministerial duties by Nick Smith. He failed to think through the transition issues around the cessation of the special housing areas legislation, and what happened? Eight developers in Auckland faced the prospect of being left flapping in the breeze when the special housing areas legislation came to an end, so we have had to pass this bill in order to allow those developments to carry on. We do not mind doing that. We think it is a rather fruitless thing to do. We do not think the special housing areas are having much effect. But, actually, when you stack them up against all of this Government’s other housing policies, they are probably the best the Government has got. But that is a very, very low benchmark.

So we are willing to vote for it, and we have made it very clear from the beginning of the debate that we would vote for Part 1. We did vote for Part 1 in the Committee stage, and we asked repeatedly that the bill be split in two so that the second part, which we think is completely untenable—to be confiscating people’s property rights under the Public Works Act—could be sent to a select committee. We have asked repeatedly that it be sent off to a select committee. My Supplementary Order Paper 212, which the Government—ACT and National—voted against would have split the bill in two, allowed the first part on the special housing areas to be passed tonight, and given those eight developers in Auckland the breathing space that they need. But we would have sent off National’s and ACT’s confiscation of private property rights. We would have sent that off to a select committee.

David Seymour: Oh, come on, Phil.

PHIL TWYFORD: David Seymour—the self-styled protector of property rights, of classical liberal political thinking; the man who today voted to take away the private property rights of New Zealand citizens in a shabby, shonky little bill that Nick Smith has shepherded through the House. What a disgrace. How can the ACT member in this House hold his head up with any kind of self-respect? No one will be able to believe a thing he says in future about his belief in the sanctity of private property rights. If the bill had been split, we would have happily voted for the first part in order to give eight property developers in Auckland the breathing space that they need.

Housing policy under this National Government has been an unmitigated disaster. There is hardly a commentator, a reporter, anybody in New Zealand who does not believe that it has totally stuffed up the handling of the housing crisis in New Zealand. Hardly a few days go by without some new international report that says that New Zealand has the most unaffordable housing in the Western World, and we saw one come out just in the last 48 hours. International media are now covering New Zealand not through the lens of The Hobbit or what a great tourist destination we are. The issue du jour for the international media is the housing crisis and the fact that under John Key’s Government, which is so ambitious for New Zealand, we have an epidemic of children growing up in cars and garages and pensioners living out their days in suburban campgrounds, paying hundreds of dollars to rent single-room cabins. What a disgrace. That is New Zealand under John Key.

What has been the response to this meltdown in the housing market? We have a Government that refuses to even acknowledge that there is a housing crisis. We see one panicked, poll-driven, piecemeal housing announcement after another. Probably the low point in the last few months has been Paula Bennett making up stories about Government officials going out with the Salvation Army, knocking on the car doors of homeless people in South Auckland. What a disgrace. Actually, you know what was worse than that? Paying people $5,000 to get out of town and presenting that as some kind of social welfare or housing policy. Actually, no, the worst thing—the low point—was definitely when Paula Bennett’s office leaked confidential, personal information to the media about Hurimoana Dennis, who has been a national hero for the work that he has done at Te Puea Marae. That speaks volumes about this National Government and what it does. The housing crisis has been getting worse every year—[Interruption]

The ASSISTANT SPEAKER (Lindsay Tisch): Order! I am sorry to interrupt the member. We do not want this barracking across there on something that is not related to the bill.

PHIL TWYFORD: The housing crisis has been getting worse every day, every week, every month, every year of the 8 long years that National has been in Government. It is so out of touch, no matter what the issue—whether it is arguing against its own Government definition of homelessness and severe housing deprivation, which it does not accept, even though it was devised by Statistics New Zealand, Housing New Zealand, and the Ministry of Social Development. It is so out of touch that it has, on two occasions now, deliberately manipulated and selectively presented the data on foreign buyers in the housing market that has been collated by Land Information New Zealand and tried to suggest that foreign buyers account for only 3 percent of property transactions when it is patently obvious to everybody that the real figure is more than three times that.

The Government members are so out of touch. They refuse to do anything about either banning foreign buyers or taxing speculators in any meaningful way. They cling to this outdated mantra that the housing crisis is only a supply issue. They talk supply, supply, supply, but what do they do? They make the special housing areas their flagship policy. It has been a spectacular failure. The shortage of dwellings in Auckland is getting worse by the day. The Government has no answers. It is so out of touch, it does not bear thinking about. The only prospect for fixing this housing crisis and restoring affordable homeownership and decent housing for the people of New Zealand is to change the Government in 2017, and the policies that we have presented to the House this afternoon are the housing policies that we will take to the next election. Under our Government, they will be the biggest overhaul of housing this country has seen in 80 years.

ALFRED NGARO (National): Thank you, thank you! I rise to take a call on this Housing Legislation Amendment Bill. What we have heard from that member, Phil Twyford, is that that member is a gambling man—he is a gambling man. The reason why I say that is that he realises—and he has led the Labour Party members to believe—that he has got to have one each way. When you go to the bets, you are not quite sure whether you are going to win or you are going to lose, so what do you do? You take one each way. He has turned around and said, on this Housing Legislation Amendment Bill, “We vote for the special housing areas, and the extension of that time period to 3 years. Yes, it may not be great, but you know what? We have got to make sure we have got there. Why? Because just last week we said there was a national crisis in housing, and we believe it needed to be there. We’ve got to be seen to be acting in a way to make a difference.”—yes, the member may yawn, but I tell you what, this is good news. This is good news, and here is the reason why—because he has turned around and he wants a bet each way.

But, you see, Mr Twyford—he has blamed it on the Chinese. Chinese-sounding names are the reason to blame for the housing crisis, as he has called it. Then he has turned around and blamed it on speculators—he has turned around and said it is the fault of speculators. Next thing you know, he will blame it on the boogie—he will find something in his arsenal to say that that is the reason why it has all gone wrong; but that is not the reason why.

We believe this legislation is making a difference, and it is part of a comprehensive plan around housing. We know that it is not the silver bullet, but it is making a difference. It is doing these things: it is extending the period of time, which that party agrees with; it is also making sure there are time limits on lodging applications for consents for housing. We know that if you are lodging an application for consent, it makes a difference—because you are about to build a house. We know it is making a difference. When it talks about Part 2 in the bill—there was some concern about that, but we know that there is a legislative impediment. Treasury has spoken about that. All we are doing is avoiding doubt inside the legislation. We think that is important.

We have spent 17 hours—we could have done this in a shorter period of time. We know that this legislation is important; it is making a difference. We do not need to talk much longer, because we know this will go through. It is a bill that is important—again, along with our actions, which we think are making a difference. Actions speak louder than words, and we know that our record speaks for itself—85,000 houses in 3 years, not 10 years. Making a difference in construction—40,000 more in the construction industry. All of these things are part of a comprehensive plan to ensure that one thing that will make the difference—it is about more supply and more houses being built. That is what this legislation is achieving. I commend this legislation to the House.

The ASSISTANT SPEAKER (Lindsay Tisch): I call Su’a William Sio—[Interruption] Order! I have called one of your colleagues.

Su’a WILLIAM SIO (Labour—Māngere): Normally at the third reading speech, we are generally wanting to express our gratitude to people who have considered the legislation and to thank members of the select committee. I do not feel any sense of gratitude tonight. In fact, if anything, I feel more animosity and anger towards the Minister for Building and Housing and that Government of his.

I should be grateful to Mr Alfred Ngaro for acknowledging that there is a housing crisis, but I know the way he behaves now. Once upon a time, he was a caring person, but he now reflects everything bad about this Government—the arrogance, the uncaring, the fact that he says to the Pacific community that there is a national housing crisis but then comes to this Committee and votes down every amendment that we have put up to grow the housing stock, to crack down on speculators, and to restore and enable Housing New Zealand to look after those who are needy. He will be voting down every single one of those amendments. You see how he has changed, in only two terms? You see how he has changed? He reflects the total arrogance of that particular Government.

This is a Government that has been in power for the last 8 years, and, as a Government, it has been privileged with the powers, the authority, and the resources to do something about this housing crisis. But for 8 years we have simply been told that this is what it is doing, and the fact remains—the fact remains—that in that 8 years we have seen inequality increase. The number of people in homeless situations has gone up by 20 percent—that is right. People living in cars has become normalised. People living in garages has become normalised. In fact, the Government’s own department now refers people into garages, as if that was an acceptable mode of accommodation. That is wrong. That is totally wrong. If the Government was genuine, if it was sincere about addressing this housing crisis—which all of New Zealand now recognises and all of New Zealand now talks about—it would have voted along with all of the Opposition parties in support of each of the amendments that were put forward to address this housing crisis.

I do not understand how people on that side of the House can accept that the average price of a house in Auckland is now over a million dollars. I do not understand how they can say that that is affordable housing for people in Auckland when working-class communities such as mine, in Māngere, and many others, on an average income of $60,000, will not be able to service a mortgage close to a million dollars. They will not be able to access mortgages, because they will not have the 20 percent that is required to buy a house at that particular price. But it is not just Auckland—the housing unaffordability crisis has spread out to the regions. It has spread out to the South Island. So it is not just Auckland that we are talking about.

The Minister came down earlier and presented some graphs. I do not know whether he made those graphs up—we will never know, because this bill was never forwarded to a select committee. This House was denied the benefit of receiving a select committee’s advice and denied the benefit of receiving public submissions from the general public. I suspect that if that had been done, many, many more Opposition members on this side would have been a little bit more confident about what we are passing tonight. I do not feel any confidence whatsoever.

You see, Part 1—although we would agree about the transition period of extending those housing accords and the special housing authority to give time for those to be implemented, the reality remains that the new powers in Part 1 enable the Minister to override local authority, to override the Auckland Unitary Plan, which has been worked upon by elected councillors and local board members. The Minister does not have that right—he does not have that right—but in the regulatory impact statement I note that there are five special housing areas, five special housing areas that are established on land that is not zoned residential. This Government gave the Minister the power to override the Auckland Unitary Plan authority for the sake of those five special housing areas.

Part 2 concerns me—I draw your attention to what Metiria Turei said earlier. I am now suspicious, more so than ever, about what mess this Government has created that we will end up paying for—what mess this Government has created because of the disgraceful way that this Minister has behaved. It is, as Andrew Little said, a constitutional disgrace that this Minister is removing property rights from those who, once upon a time, were the original owners of land that was forcibly taken under the Public Works Act for the sole purpose of creating affordable State accommodation. If that is no longer the purpose, it is the original owners, including iwi, to whom we should be returning those lands.

This Government has made fun of the KiwiBuild commitment that we have made. We have presented that as proposed Part 3 of this bill, asked the Minister to examine it, and we have debated it. But as I have said, it is shameful that some members on that side of the House will go out to the community and say “Yes, we understand there’s a housing crisis. We feel sorry for you.”, but then come back and turn up in this House and vote down the legislation that would improve the lot of people in need.

Next Saturday Te Puea Marae will recognise the Māori wardens who have worked alongside it to provide temporary accommodation for people sleeping in cars. It is its hope and wish that we do not return to having to supply this temporary accommodation next year, but, based on what we have heard from this Minister and the way that this Government has voted against the various amendments that were put forward to address the national housing crisis, I believe that we will be back again next year, in the cold of winter, with Te Puea Marae and many other maraes offering, again, temporary accommodation for people who are sleeping in cars and overcrowded situations.

It is appalling for a country such as New Zealand, which prides itself as one of the wealthiest of the developed nations, as a country that rubs shoulders with Obama, as a country that rubs shoulders with some of the greater economic powers of this world, to then come back to this country and accept the fact that we have a growing number of young people who will never ever be able to afford to buy their home at increasing prices, unless mum and dad provide some gift of equity or a family house. That is the situation that this Government has created, and it is solely because of its policies. It has the power and the resources to address this crisis, but it just will not. It will not address it.

As I have said repeatedly now to members of our own community, and as I said it to Mr Alfred Ngaro a month ago, the only way, the only way, that a Labour Government would be able to build 10,000 houses a year—100,000 houses for the next year, mind you. In Auckland we need 44,000 houses today to meet the ongoing population growth, and nothing provided in this piece of legislation is ever, ever going to address that. It will not address it today, it will not address it tomorrow, and it will not address it next week, so next year, again, I fear that not only will Te Puea Marae have to open its doors for the homeless but we will see a growing number of people living in those homeless situations. All of that is because of this Government’s policy. As I have said, again, to the young people—and I will continue to say it—the only way that we can improve and address this housing crisis is if we get rid of this lot. We have got to get rid of this Government here, because that is the way that you can bring about change.

Mr DEPUTY SPEAKER: It is tragic to interrupt the member, but his time has expired.

JONO NAYLOR (National): As tempting as it is to talk about the all the things that have been moved and have not passed over the last 17 hours, I just want to bring the focus back to talking about what is in the bill that is now before us at its third reading, and what it set out to achieve. What this bill will do is it will actually bring into alignment the special housing areas with the Auckland Unitary Plan, which is about to come into force; it will ensure that more houses will be able to be built in parts of New Zealand that need more houses; and it will tidy up some language to remove some ambiguity around the language to do with the Public Works Act.

It has actually been a pretty simple bill. It has been made a little bit more complicated along the way by some of the conversations that have gone on here over the last couple of days. But I am looking forward to seeing more houses built, I am looking forward to seeing the alignment with the Auckland Unitary Plan, and I am looking forward to seeing this bill finally pass this evening. Thank you.

METIRIA TUREI (Co-Leader—Green): So the Opposition has taken control of the House over the last 2 days, and what have we done with the time? We have made housing our No. 1 priority as an Opposition. Why is that? Because when we are in Government, it will also be one of our main priorities. Why is that? Because it is the priority of New Zealanders.

We have thousands of New Zealanders who are sleeping rough in garages and cars, on their friends’ couches, in tents, and in hotel rooms because they are desperate for housing. We have thousands of young New Zealanders who are working hour after hour and have no chance of ever getting into their own home, because they are locked out by speculators supported by the National Government. They need houses too. We have young families, families with children, who are trying to find secure, decent, warm, dry, and safe affordable housing to raise their children, so that their children have the best opportunities for the best health, for the best education, and for the best future. Those families need housing. We have elderly people who are heading into retirement who were not able to buy a home and secure their housing, who are worried about what their retirement will be like if they have to spend their superannuation not only on what they need daily but on their rent as well, because it was never designed to deal with renting in the same way. Those elderly people—they need houses.

Who was here over the last 2 days, standing in this House hour after hour, with our caucuses lined up along here on the Opposition benches? We were the ones putting forward the solutions, trying to figure out what the different options were, and thinking about negotiating with the Government to find solutions to work through the housing provisions and housing solutions that were on the Table. Why is that? Because it is the Opposition that puts housing as a priority. Where were the Government members over these last 17 hours? Did you hear a peep out of these people? No, they were sitting there, hopeless, their mouths open—gobsmacked. They were gobsmacked, just sitting there doing nothing and saying nothing while it was the Opposition members—Labour, Greens, New Zealand First—who were here, standing up minute after minute, hour after hour, putting forward the solutions to deal with the housing crisis that our people are facing every day.

I think Phil Twyford has got it absolutely right. It was the Opposition that represented New Zealand over the last 2 days while the Government members were sitting around trying to figure out how to get rid of Nick Smith—because he has made such a terrible fiasco of this entire process. That guy—honestly. Ha, ha! I mean, really, he could not have made more of a mess of this legislation or the process. From start to finish, it has been an absolute disaster. He will be in such trouble, having humiliated the Government over the last 2 days. But Nick Smith handed to us, the next Government of New Zealand—Labour and the Greens, and New Zealand First if that is what it wants—2 full days to debate the single most important issue that is facing New Zealand families today. So I do thank him. Thank you, Nick Smith.

Do you not think we just need to say thank you, Nick Smith, for being so terrible at your job, and being such a great representative of National. You are such an excellent example of what National Ministers are—their incompetence, their fallacies, and the secrecy that they promote in the process of their legislation. Let us not forget that one of—[Interruption] Oh, now the insults from the Minister who walks past me and makes nasty little insults as she goes past because she cannot bring herself to engage in the debate. Minister, where have you been over the last 2 days? You could have come here and debated the issues, but no. She just walks past me and makes a little nasty insult in my ear. That is the kind of Minister whom John Key puts up in his Government. You are either incompetent or you are nasty—that is what they promote over there.

Hon Member: Or both!

METIRIA TUREI: Or both. Come and debate the issues with us over here, Minister. You could have been here for the last 17 hours talking about the most important issue facing New Zealanders, which is warm, decent, affordable housing. Where was this Minister? I did not see her here during those 17 hours. Where was she? Where was she in the debate? Where was her passionate conversation—her passionate solutions for dealing with the housing crisis? No—just nasty little things.

But she diverted me from the point, which was reminding us that one of the core provisions in the piece of legislation that was put forward by Nick Smith was an attempt—and, unfortunately, a successful one thanks to the ACT Party—to take away from New Zealanders their property rights in order to disguise a mess that he has made over the legal status of State housing land. As to the nature of that mess, we have tried to ask him questions about the mess that he has made, we have offered options for him to talk to us about that mess, to find a better way to clean it up, but Nick Smith is keeping the details of the mess he has created secret, so we do not actually know what is really going on. What we do know, though, is that ACT and National have joined together and are complicit, under this legislation, in taking from New Zealanders their property rights, and they are disguising it as not really being anything—yet again, another example of the kind of behaviour we can expect from National Party Ministers.

In this debate, the Opposition has put forward a large number of solutions. We offered a percentage of affordable homes and a definition of affordable housing; “No.”, said National. We gave National members the option to help build 10,000 homes a year. “No.”, said National. We offered to improve the brightline test to reduce the effect of speculators in the market. “No.”, said National. We tried to stop foreign ownership in our housing market, so that New Zealand families can have a genuine go, and what do we get from National? “No.”, said National. We offered to improve urban and infrastructure planning to make it easier for cities like Auckland to grow like they ought to; what did National members say? They said no.

Phil Twyford: Even David Seymour voted against that one.

METIRIA TUREI: Even David Seymour voted against that one. We offered an opportunity to build 250 more State houses a year, and what did National say?

Hon Members: No.

METIRIA TUREI: National said no—that is right.

Finally, at the end of an incredible piece of work with the homelessness inquiry—which was a joint effort on homelessness amongst Labour, the Greens, and the Māori Party—after hearing all of those tales of woe that were real stories about the real lives of New Zealanders who are affected by homelessness, the Opposition offered to the National Government an opportunity to deal with that homelessness crisis in a practical way, and what did National members say? They said no. They said no to helping the homeless, they said no to helping young families, they said no to helping young people, they said no to helping the elderly to get the kind of decent, warm, safe, and affordable housing that all of those people need. How could National members stand there—or sit there, because they did not really go anywhere, did they—and say no to those thousands and thousands of New Zealanders who want these solutions put in place?

I want to thank National members for giving us the opportunity to expose their failures, to expose their fallacies, to expose their secrecy to the country, and to offer to New Zealanders the genuine alternative at the election in 2017—the alternative of a new Government that will put the issues that New Zealanders consider the most important for them at the centre of the work that it does. Housing is that, but that is because housing represents the right of New Zealand families to live a decent life in this beautiful, rich country that we have; for them and their children to live a well life; to have access to a beautiful environment, to a great education, and to a good and bright future for those kids. That is why we will change the Government in 2017. Thank you.

DENIS O’ROURKE (NZ First): I also wish to begin by thanking the Minister for Building and Housing for the opportunity of a 17-hour debate to show the superb alternatives that are available to the failed Government policies that the other side has failed to turn up and defend tonight. Each of the three Opposition parties has been able to demonstrate the quality of its various proposals in the alternative to the Government’s policies, and I have a lot of respect for each and every one of the parties’ proposals. I hope the public has now understood that there really are alternatives to housing failure and the National Government.

I want to thank the Labour Party for its excellent suggestions, most of which New Zealand First supported. I want to thank the Greens for doing the same. I want to thank the Māori Party members for changing their minds. I want to thank them for changing their minds after supporting urgency and then voting against the Government by voting for all of the Opposition parties’ amendments. It seems a little bit strange, but I think they deserve some congratulation on their willingness to change their minds in that way.

Su’a William Sio: Don’t overdo it.

DENIS O’ROURKE: No, I am not, because I am a little bit disappointed that they did not actually show up to debate. Not once—17 hours, not a word. That is a bit of a disappointment. Is it because they are simply not keeping up with the situation? Surely it cannot be that they do not really care about policies such as offer-back and the impact it would have on the people they claim to represent.

But I am not going to spend too much time on that, because it really does not matter. What I do want to say is: is this about the “Minister for Homelessness”? He did not mention in his last speech the fact that this week Auckland house prices for an ordinary two-bedroom house have now reached the magic but tragic $1 million. Most New Zealanders are still in disbelief over that, and you can understand why. That, if anything, is absolute evidence of the failure of Government policy—right there.

The Minister also did not mention the failure of the special housing areas (SHAs) that are the subject of this bill. The truth is that over the last 3 years only 1,300 houses have been built as a result of that policy, and the need, as I have previously said in my speeches, is actually something like 20,000 houses per year over the next 7 years in Auckland alone. Yet this is the pathetic result that we get from this Government. That is also evidence of total failure of Government policy.

What the Minister did say showed a total lack of empathy for people who cannot afford that $1 million for an ordinary home and who cannot afford the rent increases, which are now skyrocketing out of reach of most people. A lot of them have to move continually, chasing lower and lower rentals so that they can just find a place to live. I think it is simply because the National Government really does not care. It does not care about that, and what it does care about is that its supporters will be happy about the increase in value of their homes. What it does care about is that the private developers, who no doubt give donations to the National Party, will be able to make greater profits, but it does not really care about the people who are affected.

This bill is mostly about extending the SHAs by another 3 years, so we are entitled to ask whether that will work. In that context, let us have a look, first of all, at what the Minister has said just this week. Firstly, he said: “Auckland house prices are out of control.” That is the only thing he has been right about this week—the only thing. He also said this week: “I won’t rest until that house price inflation rate gets down to single figures.” Let us just think about that. With the average house price in Auckland now $1 million and with single-figure inflation, that would still mean another $100,000 at least per year on the price of a home. Worse than that, an extra $20,000 would need to be found for a deposit. That actually shows how out of touch the Minister is about this.

I want to also quote Shamubeel Eaqub, who said this: “Based on my calculations, the typical Auckland house now would take 71 years to buy—20 years of savings for the deposit and 51 years of repayment to clear the debt.” So you would actually have to live 71 years just to get rid of—well, you would actually have to live longer than that because you would not be able to start getting a loan until you were about 20. So there you go—91 years before you would have a mortgage-free home. But it is worse than that. It is worse than that, because what the message is to first-home seekers is this: the Kiwi dream of getting your own house is now just a dream of getting a house deposit, nothing more, or renting for the rest of your life. Nick Smith wants to bring house prices back to four times household incomes without reducing house prices. Household incomes would therefore need to increase to at least $250,000 per year in order to do that. How many people are going to fall into that category? Well, we know that most people by far will get nowhere near that kind of income.

So in answer to my question as to whether it will work, the only reasonable conclusion is that the Government’s housing policy is an abject failure. The SHAs will have absolutely no hope of delivering the outcome that is claimed for them, and the reason for that is that the Government refuses to actually invest directly as well as doing these SHAs, and it actually thinks that just relying on private investment will be enough. Well, it never will be. Without direct Government investment it never will be.

Finally, all this is exacerbated by other things. The truth is that with open-door immigration and a net 70,000 people a year coming into New Zealand, especially to Auckland, there is no hope that any Government policy, however bad or good it may be, will be able to succeed. New Zealand First is the only party that has constantly said that without controlling immigration a solution to the housing crisis will never be found. It is not the only thing that needs to be done, but that also needs to be done, and we are the only party that has been saying it and will continue to do so.

In addition, the situation is exacerbated by the failure of the Government to provide any controls on overseas buyers. Again, New Zealand First has been pushing for that for years. Other parties have caught up a bit with us, but New Zealand First is the party that has been pushing for that for years. The truth is that those buyers have the cash to outbid Kiwis for homes, in Auckland especially, and they have the intent to engage in capital gains farming, speculation, and land banking, and all of those things are causes of the housing crisis that this Government simply will not address.

This Government has been sitting on its hands and fiddling with failed policies while other parties have been coming up with genuine and effective alternatives, which this Government refuses to consider. Government members blame local government. They do nothing to stop land banking. They do not care about first-home seekers. They ride roughshod over people’s offer-back rights. They are an utterly hopeless failure, and the sooner they go, the better.

Dr PARMJEET PARMAR (National): It is a pleasure to take this call to support the Housing Legislation Amendment Bill in its third reading. On this side we know that housing affordability and availability can be addressed by increasing the supply. We do not want special housing areas (SHAs) that are already listed to lapse, because that would create a big lag and we do not want to create a big lag in the housing supply. As the National list MP based in Mt Roskill, my interest is in Auckland, and just in Auckland 154 SHAs have been established.

Denis O’Rourke, the member who spoke before me, counted the number of houses that have been built in the last 3 years, but it is not just about the number of houses that are completed. We have to look at the full picture. It is about the creation of sections, it is about planning and resource consents, and it is about the infrastructure that goes with building houses. So we need to look at the full picture, and I would like to give some numbers here. Yes, on 30 June, 1,342 homes had been completed. There were 2,208 building consents approved and 6,731 resource consents for sections approved. So we need to look at the full picture.

Since we started this legislation, I have heard about affordability from the Opposition, so I would like to actually give some examples to clarify affordability. Let us go to the 1980s. Let us go to the late 1980s and pick a house that was $300,000. The interest rate in the late 1980s was 19 to 20 percent, and if one person borrowed for 30 years, the weekly payment for that person came to $1,100. Yes, the weekly payment came to $1,100. If I bring you back to this time—2016—interest rates are around 4.1 to 4.2 percent. If we pick a house that is $1 million—yes, we pick a house that is $1 million; we have heard this value a lot in this discussion—and if one borrows for 30 years, the weekly payment comes to $1,121. So for a $300,000 value house it was $1,100, and now, for a $1 million house, it is $1,121. On that house of $300,000, people were paying $1.4 million in interest—$1.4 million. On this house of $1 million, people are paying $750,000 on interest. So you can see where the savings are.

It is because of the great policies of this National Government that interest rates are low. Affordability takes into account lots of factors—lots of factors. It is not just the income and not just the house price, but interest rates too. On this side, we are committed to ensuring that there is a supply of houses and that houses are affordable. It is a great bill. I support this bill and commend this bill to the House. Thank you.

Mr DEPUTY SPEAKER: A 5-minute call on behalf of the Green Party—Marama Davidson.

MARAMA DAVIDSON (Green): Gosh, it has been a long couple of days and we are coming now to the third reading of this tragic bill. It is a long, tragic story, actually, the whole thing. It has been quite historic, this debate. So I do actually quickly want to acknowledge the Clerk’s Office and the staff and all of their incredible work that they have done to allow us to debate in this democratic system. To allow us to debate, they have had to—you know, we have been throwing bills and amendments up there, and they have had to do all of the things so that we can smoothly debate such an incredibly important issue for our country. So from all of us I would like to thank the Clerk and the Clerk’s staff. Thank you all very much. This has been a bit of a historic debate. The Minister put up a bill to rush through urgency and it totally got away from him. It totally got away from the Government—a little bit like the housing crisis. They lost control—they got no handle on it. Ae, right?

Ōrite tonu ngā raruraru. [The problems are really very similar.] They just lost it. It just got away from them. They thought: “Oh let’s do this. Oh, whoops! It got away.” So it has been important. It has been important though because New Zealanders have been watching, I tell you. Oh boy, they have been watching the Opposition. So let us start with a vision. How about this for our country? How about this: that nobody here has to go to sleep at night in their bed and worry about money. Do you know where that came from? It was John Key in 2008. That is where that came from, in his definition of “What do you define as rich?” in a debate between him and the Rt Hon Helen Clark. He gave a fantastic definition. Everyone acknowledged it was the best. Do you know what was fantastic about it? He did not put up statistics and numbers like the Government is doing right now. He put up something real. He put up something real that New Zealanders understand. [Interruption] Shh! I am not talking to you; I am talking about you. He put up something real. He did not put up a graph, he did not put up numbers, he did not talk about housing consents or interest rates; he put up something human.

OK, so let us expand on the honourable Prime Minister’s own vision. How about one that I heard in Kaitāia last week, like: “This will be the last generation to experience any insecure, unsafe accommodation.” How about that? You know, when I said that the wealth of this country is our people, I really meant it because they said this. They asked for this. They really are our thinkers. They have the solutions and the ideas. They have the vision, they have the plan, and they have the smarts. It is our job to listen and to make that happen. They are our wealth. I am talking to them. I have been talking to them this whole past couple of days.

This bill, alongside all of the other ad hoc pieces of legislation that the Government has been embarrassed into, will not protect our future generations. And our Government knows this, so it cannot then commit to it. It cannot say it. It cannot even concede and say that there is a housing crisis. It cannot say it will end homelessness, because it knows that nothing it comes up with is about that. Do we hear this? New Zealand, do we hear this? Nothing that those members will come up with is about ending homelessness.

That is really all our New Zealanders need to know, and our Opposition has spent the past couple of days outlining the things that will end homelessness—a whole list of things. Oh, they have been put out: ban non-resident buyers so we prioritise all our New Zealand residents to buy; ban tax speculators so that our first-home buyers can have a fair go; build thousands more State homes; build thousands more affordable—truly affordable—homes, and more safe and warm homes; improve the urban design rules; and, mostly, mostly, mostly, have an actual plan. Commit to actually seeing the end of homelessness. So we threw all of this up—oh boy, did we throw it up. We fought hard for all of it. We fought hard for all of it, and I am proud of what we did. Thank you.

Mr DEPUTY SPEAKER (Hon Chester Borrows): A 5-minute call on behalf of the ACT Party—David Seymour.

DAVID SEYMOUR (Leader—ACT): As tends to be customary, I follow Marama Davidson, and I can observe that the best I got from her speech is that she has a vision of humanity where humans are not bothered by such things as statistics, numbers, and graphs. That is why she can have as much emotion and goodwill as she likes, but no actual solutions to the practical problems facing New Zealand.

This has been an extraordinary debate. At one point Grant Robertson told the children of New Zealand that there is no free market and there is no Santa Claus, and I want to conclude this debate by telling the children of New Zealand that he is wrong on both counts. We found that Marama Davidson cannot hear. We saw Newshub smash the Labour Party and the Opposition tonight. That is something that should be watched by the Opposition, because no matter how clever the Opposition members think that they have been, the way that the press have reviewed what they have done to their viewers is that, basically, the Opposition has wasted a huge amount of time and taxpayer money achieving nothing. That will be the net result in the eyes of the New Zealand public.

The Labour Party does not know its own history—that is another thing that we got out of this debate. We discovered that the Labour Party does not really understand what the role of the State has been in building housing throughout New Zealand history. It was never more than a very small fraction of homes built, even at peak home-building times in New Zealand history. But we also had more serious issues that we needed to consider, because I cannot think of many problems in New Zealand today that would not be resolved if we had a more functional housing market.

The fact of the matter is that Auckland has built 20 percent fewer houses in the past decade than were built in the 1990s. That is the reason why we have financial instability, it is the reason why we have social problems, and it is the reason why, for instance, you can visit a school where they feel they are almost teaching a different group of kids each term because of transience in the student population related directly to the shortage of stable housing and accommodation. So we were addressing what is a very serious issue.

It is regrettable that Phil Twyford’s amendment that would have effectively outlawed urban growth boundaries—which have caused so much damage to housing markets in New Zealand—was not able to pass, but the member has got no one to blame but himself. He gave 1 hour’s notice of one amendment amongst seven that actually had some merit. So I would say to the member, next time he wants to make a proposal that is actually useful, do not hide it amongst all of the other banal, asinine policy initiatives that the Labour Party usually gives out. It is impossible to keep track of Labour’s good policy initiatives because they are hidden amongst so many bad ones. Having a grab bag of failed policies such as a capital gains tax has not worked. Foreign buyer restrictions have not worked. Government building programmes have never been a big part of New Zealand’s housing agenda. What about inclusionary zoning, from Metiria Turei? It never worked. When there are so many bad policies from the Opposition, how are we supposed to know that it actually proposed a good one? The fact of the matter is Phil Twyford could have had a big success, but he could not even pick up the phone and give me a call. Next time, Phil, call me.

Let me just conclude by saying that this bill was necessary to continue the existing special housing areas. It is not ideal, but, none the less, the special housing areas are one of the best things that the Government has going right now. They are an island of fantasy attempting to suspend the reality of the housing market, which is a sea of dysfunction. I can reiterate that Part 2 of this bill has not seriously changed property rights. It has clarified what was already legal, and it has simply protected the Government from legal challenge.

I am very proud that the ACT Party has made the only successful amendment to this bill, which is more than your Phil Twyford can ever say. By having a review of that clause, we will substantially improve public policy in New Zealand in good time. We are actually improving public policy for all New Zealanders because we are going to review Part 2 of this bill within 10 years, and with the cycle of development being 10 years, that means it will be reviewed very soon. Mr Deputy Speaker, thank you very much for the little bit of extra time. I proudly support this bill in this House.

MAUREEN PUGH (National): It is with great pleasure that I stand in support of this Housing Legislation Amendment Bill, which is finally in its third reading. I would like to give credit to the Hon Dr Nick Smith. The Hon Dr Nick Smith has recognised what is needed to ensure that we maintain momentum for building houses for the thousands and thousands of Kiwis to realise their dream of owning their own home. He understands the whole picture, he analysed all of the issues, and he found practical and workable solutions. We are now building three times as many houses in Auckland and twice as many nationally compared with when National first came into office. This bill is another tool for National’s comprehensive housing plan and it will deliver even more houses for New Zealanders. I am very pleased to commend this bill to the House.

Mr DEPUTY SPEAKER: A 5-minute call on behalf of the Labour Party—Louisa Wall.

LOUISA WALL (Labour—Manurewa): Malo ‘aupito, e Te Māngai o Te Whare. We are now in the 18th hour of debating this bill under urgency, and I think it is really important that I clarify our position on the bill, particularly in relation to the two parts of the bill that were presented before the House before the commencement of debate, because, in fact, we have debated eight parts of this piece of legislation.

Part 1, which we support—and I want to reiterate that—is to extend the smooth transition to the Auckland Unitary Plan, which commences on 16 September 2016. It was done to ensure that eight specific developments could continue—that those developers would not have to submit new resource consents. The relevance, actually, to the whole discussion about affordability is 591 affordable houses, because those eight specific developments are going to provide 7,880 houses. We support that part of the bill.

In terms of Part 2, we are very clear that we do not support that part of the bill. The reason that we do not support that part of the bill—actually, I am going to quote from section 16 of the Public Works Act, where the Minister is “empowered to acquire under this Act any land required for a Government work.”, and any local authority is empowered to acquire any land for local work. But there is an explicit contract in our Public Works Act that land not needed be offered back to the person from whom it was acquired. That is, essentially, our primary opposition to Part 2: we think that we have circumvented that explicit contract between the Crown and New Zealand citizens who have handed over parts of their property to public works for the greater good. That, essentially, is our opposition to that part of the legislation.

There were three other parts to this piece of legislation that I specifically want to mention, the first of which was new Part 3, introduced by my colleague Phil Twyford. Really, it was about providing 10,000 affordable houses per year for first-home buyers. Our rationale for those 10,000 affordable houses for first-home buyers is actually about the number of houses that we sell in New Zealand every year. There are 90,790-odd homes sold in New Zealand every year, and approximately 21 percent of those purchasers are first-home buyers, based on 2015 statistics provided by CoreLogic. That is 19,066 first-home buyers in the last financial year. This particular amendment was incredibly relevant to that practice.

The second part that I want to highlight for the House is new Part 7, which amended the Housing Corporation Act. It was about the distribution of profits. Again, I want to acknowledge Metiria Turei, because, essentially, the proposition was for surplus profits. In 2014-15 it was a $226 million profit that should be reinvested back to provide rental housing for those most in need. That is an incredibly important principle, and I think it needs to be highlighted.

New Part 8, which was amending the Housing Restructuring and Tenancy Matters Act 1992, was about increasing the supply of Housing New Zealand properties by 1,000 every year. It is relevant when we look back at the number of people waiting on housing lists. If I read the numbers out, in March 2012 there 4,637 people on the waiting list; in March 2013, 4,495 people; in June 2014, 5,840 people; in September 2015, 4,467; and as of July 2016 we have 5,012 New Zealanders waiting on the Housing New Zealand waiting list. Actually increasing the housing stock every year by 1,000 would help meet this chronic need, which has now been displayed for the last 5 years.

I just want to end with some statistics from Manurewa Marae. Manurewa Marae has got 64 people who are currently residing at Manurewa Marae, and of those, essentially, 67 percent of the people at Manurewa Marae are children. The issues that we are dealing with are about how we are preparing the next generation for the opportunities that we want to provide them. Their being homeless is actually a shame on our country. Kia ora.

IAIN LEES-GALLOWAY (Labour—Palmerston North): This bill and the 17-hour-long marathon debate that we have had around it are emblematic of the state of this Government: it is in a total shambles. Back in 2008 there was no way that the National Government members would have allowed the mess that this bill has become for them to occur. They are completely out of control. It is not just Nick Smith who is out of control, it is the whole National Government—utterly shambolic. They are also completely out of touch, because they think they are doing a good job on housing. They have absolutely convinced themselves that they are doing a good job. They think that having 42,000 people homeless in New Zealand is doing a good job. They think that having an average house price in Auckland of $1 million is doing a good job. They are completely out of touch with reality. Of course, what we have known all along and what this bill has simply underlined is that the National Government is utterly incapable of dealing with homelessness and housing affordability.

The Government members do not have an answer to it, because they know what has to be done—they know what has to be done. They know that we are not going to solve this issue without a massive effort from the Government, but it is simply not in the National Government’s DNA to do that. They know it is the right thing to do, but they are religiously, ideologically stuck to the doctrine of free markets and they cannot bring themselves to do what is necessary. The Labour Party and the Green Party and New Zealand First all brought amendments that would make real differences to housing affordability. We brought an amendment to say: “Let us introduce our KiwiBuild programme. Let us build 10,000 affordable homes a year.” Then we said: “Let us extend the brightline test. Let us discourage speculation in the housing market by actually taxing the capital gains that people make on speculation.” Then we said: “Let us tighten up foreign investment.” Then we said: “Let us have a national policy statement on urban development.” Then the Greens said: “Let us stop taking a profit from Housing New Zealand and invest that money back into building more social housing.” Then we said: “Let us make sure that we do not have any fewer than 8,000 places for emergency housing.”

On every single one of those proposals the National Government members said no—no to building affordable houses, no to taxing capital gains, no to tightening up foreign investment, no to a national policy statement, no to stopping the profit taking from Housing New Zealand, and no to making sure that we have adequate emergency housing—because it is just not in their DNA. The Government members are simply not capable of doing it, because their mates are doing very nicely out of the current situation and they are beholden to those people—the handful of people at the top, the ones who are doing well, the ones who are getting the wage increases, the ones who are benefiting from capital gains, the speculators, and the foreign investors. That is who supports the National Government, and that is whom the National Government works for.

That is why it has failed to do one thing in this piece of legislation that will actually address the issues of housing affordability. That is why, in New Zealand right now, we have the lowest rate of homeownership since the 1950s. That is the reality. This Government is so out of touch that it refuses to acknowledge it, but that is the reality for people. They cannot afford to buy their first home. Some people cannot even afford to rent a home, so they are living in cars, they are living in garages, or they squeeze their whole family into somebody else’s living room. But the National Government does not want to know that because it does not fit its ideology to do something about it. It does not fit its doctrine to do something about it, because it is absolutely straight-jacketed by its adherence to free markets.

There is a difference between this side of the House and that side of the House. There is a difference between Labour, the Greens, and—sometimes with us—New Zealand First, and the National Government. New Zealanders need to know that difference. I thank the National Government members for giving us this opportunity to demonstrate the clear difference between them and us. I say to New Zealand: if you want a solution to homelessness, then it is quite simple—change the Government.

JAMI-LEE ROSS (National—Botany): I feel a little sorry for the Opposition. I have not seen Opposition members this excited since David Cunliffe was delivering his speech on election night when Labour lost the election—the lowest they have been in many, many years. The most excited they have been was when they were talking in this House and actually wasting taxpayer money for—how many hours was it? Seventeen or 18 hours? They are proud of wasting taxpayer money, but only weeks ago they were hammering backbench MPs in the National Party for putting up members’ bills. This side of the House gets excited when we do things like growing the economy. This side of the House gets excited when we do things like lifting real wages. This side of the House gets excited when we deliver more sections for people to build on, to deliver more housing for New Zealanders.

That is what this bill is about. I have met the developers that this bill specifically works for, to ensure that they can continue with the projects that will deliver more housing for Aucklanders. More housing for Aucklanders is what we need; it is not 17 hours of the Labour Party and the Opposition and the Green Party playing games in Parliament. What Aucklanders need is actual houses to be built, and that is what this bill is all about.

Apparently, it is trendy to talk about the Supplementary Order Papers (SOPs) that were put up during the Committee stage—all of the wish-list proposals that they would have liked. I would have liked to see some SOPs that reflected reality, such as the fact that house prices doubled when Labour was in office. That is a reality. Those members should have put something like that up in an SOP. I would have liked to see an SOP around the fact that interest rates were up at about 10 or 11 percent when Labour was last in office. Where was the SOP on interest rates and how high they were when Labour was in office? I would have liked to see an SOP about the land strangulation policies that the Labour and Green parties actually supported when they were in office—those policies that led to unaffordable housing through the strangulation of land and ensuring, under their watch, that supply was not enhanced to enable houses to be built. I would have liked to see an SOP from the Green Party talking about the fact that they want hundreds of thousands of Aucklanders to go bankrupt when they drop house prices by 50 percent. Opposition members go quiet when we talk about that, because they know that under the recent marriage between those two parties that is the reality they will be facing.

Whatever the question is around housing, the answer is delivering more supply and delivering more sections. That is what we are focused on. Build rates are four times faster in Auckland now than what they were when Labour was in office. We are delivering the effective size of Whangarei to Auckland this term, and next term the unitary plan that this Government put in place and the process to see it delivered are going to lead to 400,000 additional homes being built in Auckland. Aucklanders and New Zealanders need more houses. Aucklanders and New Zealanders do not need the Opposition wasting 18 hours of taxpayers’ time in this Parliament. We are delivering solutions; we are not just talking about them. I commend this bill to the House.

A party vote was called for on the question, That the Housing Legislation Amendment Bill be now read a third time.

Ayes 61

New Zealand National 59; ACT New Zealand 1; United Future 1.

Noes 60

New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.

Bill read a third time.

Speaker’s Statements

Urgency—Reflections

Mr DEPUTY SPEAKER: As has become a recent tradition, it remains for the Speaker to bestow some awards. For the most articulate closure motion—Kanwaljit Singh Bakshi. For the most informative analytical speech—the first speech by David Seymour last night. The most good-natured protagonist was Phil Twyford. The least offensive speaker taking the most flak was Parmjeet Parmar. And the bloke having the most fun was Denis O’Rourke.

The House adjourned at 10.54 p.m. (Wednesday)