Walker Holly: Housing Accords and Special Housing Areas Bill — In CommitteeText is incorporated into the Bound VolumeWalker Holly: Housing Accords and Special Housing Areas Bill — In Committee[Sitting date: 03 September 2013. Volume:693;Page:13170. Text is incorporated into the Bound Volume.]HOLLY WALKER (Green): I am pleased to take a call straight after the Minister of Housing to talk about the issues of supply and how they relate to affordable housing. But to situate my comments first of all I say—and I think it is agreed probably across the Chamber—that we do have a crisis of housing affordability in New Zealand and also a crisis of housing quality. There are three statistics that I like to quote and they all involve the number seven. First of all over $700000 is the average house price in Auckland which is completely unaffordable for your average first-home buyer. Secondly it takes 70 percent of the average income in Auckland to service the mortgage on a lower-quartile house. On a lower-quartile house—that is the cheapest quarter—it takes 70 percent of the average income in Auckland to service that mortgage. And finally 70 percent of the children living in poverty in New Zealand are living in poor-quality private rental houses. These are three statistics that clearly illustrate the crisis of affordability and quality in our housing in New Zealand.If we turn to Part 1 of the Housing Accords and Special Housing Areas Bill we look first at the purpose. Clause 4 says that the purpose of the bill is “to enhance housing affordability” and it does that by increasing “land and housing supply” in those areas “identified as having housing supply and affordability issues.” Well so far so good. I agree with the Minister that supply is very important in the question of housing affordability—that is the supply of affordable houses is very important in the question of housing affordability. But I am not convinced by the Minister that land supply is actually the primary problem in the provision of affordable houses and that is the first problem with this bill. There is a fundamental mismatch between the problem it sets out to solve which is housing affordability—it says “enhance housing affordability” right there in the purpose clause—and the solution that it prescribes which is about increasing land supply.Land supply and affordable housing supply are not the same thing and that is a very important distinction to get clear in this debate because apart from Auckland which is the only region in the schedule currently land supply is primarily not the issue in housing affordability. We heard that at the Social Services Committee time and time again as submitters came before us from other parts of the country to say that this might be a good prescription for Auckland though there are some issues with it but in their part of the country where yes they have a housing affordability problem the problem is not caused by a lack of supply of land; it is caused by other factors and therefore this bill will not address the housing affordability problems in those other regions. So the prescription in the bill does not work to solve the problems that it sets out to solve. The select committee had to amend clause 9(3) to insert land supply as one of the criteria for deciding whether to put a region in the schedule in recognition of the embarrassing fact that it actually was a mismatch. So it is very important that the House in Committee understands that crucial distinction and the fact that the bill is setting out a prescription that does not solve the problem that the bill tries to solve.I want to look at the specifics in Part 1 and they are set out in Subpart 2. There are three areas I want to look at—first of all housing accords and how they will be arrivedat; second of all what is the definition of a “qualifying development” and what should be the definition of a “qualifying development”; and finally the provisions around the actual conduct and the establishment of special housing areas. First of all I will look at the housing accords. This part of the bill sets out how the Minister and the territorial authority may enter an agreement to work together to address housing supply and affordability issues. That is great. It sounds really good. It is absolutely right that local government and central government should work together on housing affordability issues. It sounds very good until you read the fine print. The problem with this whole provision as my colleague the Hon Maryan Street set out in her last contribution around what can go into a housing accord is that it does not actually address the fundamental issues of affordability but worse than that it gives a huge amount of power to the Minister to override the work that local councils are doing on this issue and to come in over the top of them and set up a special housing area without their consent and without a housing accord.It gives the Minister the power to terminate an accord. That has been agreed. So they can sit down and negotiate one and work it out but if there is something about that accord that is not working for the Minister he can terminate that and go ahead anyway under the conditions that he would like to see. It means that effectively it is impossible for councils to enter into good-faith negotiations with the Government to set up housing accords because all of the power resides in the Minister and in central government. They have the ability if the negotiations for the accord break down to just go ahead and set up a special housing area and set up the commissioners to make the decisions about resource consents without any recourse to the territorial authority.So if one was part of that territorial authority sitting down to negotiate with the Minister there is a fundamental power imbalance before the negotiations have even begun. That was a point made to the select committee by countless submitters and many many councils from around the country including the Auckland Council with which an accord has already been negotiated but which is very worried about what this legislation will mean for that accord and including from Local Government New Zealand the umbrella group for local councils and including many members of the public who are very concerned about the heavy-handed power that is accorded to central government in these housing accords in the way that they are negotiated which effectively makes good-faith negotiation impossible.Secondly I want to speak about the conditions for a qualifying development because there are a lot of very technical conditions set out in the bill about what a qualifying development has to do. We spent a lot of time in the select committee talking about what the definition of “predominantly residential” was for a qualifying development which is absolutely important to get correct. But it is bit like not being able to see the forest for the trees when we are bogged down in details about the height of the storey of a building and what it means to be predominantly residential as we talk about what is a qualifying development or a housing accord. There is nothing in the bill about the requirement for affordability or to require a percentage of affordable housing in a special housing area yet that is the problem that the whole bill has set out to solve. Again it is a fundamental mismatch between what the bill says it is out to do and what it actually does. So it is a major problem. It was pointed out by numerous numerous submitters that there is no requirement for affordability to be one of the criteria for a qualifying development in a special housing area and you would think it would be when that is the whole purpose of the bill.When we had the second reading the Minister addressed this point and he said: “Well look at the Auckland Housing Accord. There is a minimum requirement for affordable housing in there. So it’s all good.” And I imagine if he gets up to takeanother call he will probably say the same thing. But the only reason that that minimum requirement is in the Auckland Housing Accord is that the Auckland Council pushed very hard for it. If it was up to the Minister it would not be there at all and the provision is not there in this bill for future housing accords in other areas. It is not enough for the Minister to say that Auckland Council managed to get it in there. There is no guarantee that it will be in any other housing accords negotiated under this bill.This issue of having a minimum requirement for affordable housing in a special housing area is addressed by my colleague PhilTwyford’s Supplementary Order Paper 344. The Green Party will absolutely be supporting that Supplementary Order Paper because we think that at the very least the first criterion you should set out for a special housing area under this bill which seeks to address housing affordability should be that there is a requirement of affordable housing in that area.Finally I want to look at the special housing areas and the rules that are going to be created for them. This is where the override powers that are given in the bill to the Minister really kick in and where there was a lot of the concern from submitters at the select committee. In a special housing area once it is established if a housing accord is not negotiated or if one breaks down this part of the bill gives the Minister a huge amount of power to appoint the commissioners who make decisions under the Resource Management Act to set the terms of those decisions and to approve and fast track consents that override the provisions of the Resource Management Act. I imagine that my colleague Eugenie Sage when she takes a call later on will talk a lot about the provisions of the Resource Management Act and how this bill undermines them.But suffice for me to say at this point that some of the concerns about the override provision for councils are addressed in another Supplementary Order Paper in the name of Phil Twyford Supplementary Order Paper 343. The Green Party will also be supporting that because this is a fundamental overriding—it is indeed an override provision—of local democracy and it is entirely consistent with moves that we have seen from this Government in terms of local government on a number of fronts beginning back with the sacking of the Environment Canterbury councillors. But evident in this bill as well is a lack of respect for the authority and the autonomy of local government where if central government does not like what local government thinks says or does it will just come in and override it and that—