Smith Nick: Building Amendment Bill — In Committee 
Smith Nick: Building Amendment Bill — In Committee 
[Volume:645;Page:14748] 
Hon Dr NICK SMITH (National—Nelson) 
: 
 We have in the chair the Minister for Building and Construction Shane Jones who says that things in the building regulation area are going swimmingly well. With this bill he will further drive up the costs for councils for ratepayers and for building consents. 
In debating these three clauses I remind the Committee of the absolute mess this Government has made of building regulation. This bill makes a complete mockery of the Government’s commitments to improve home affordability because its provisions will make it even more difficult for New Zealanders to afford homes. Let me just run through what is going on out there for ordinary New Zealanders who are trying to get their building consents. 
Last week I tabled documents from the Rodney District Council that show that under the Building Act it now takes 110 pages of bureaucracy to have even the most minor of building consents go through. The Wellington City Council said that before this Government’s stupid Act it used to take three A4 plans and 20 pages of documentation to get a building consent for a standard house. Under the new Act it takes 12 A3 plans and 200 pages of documentation. This Minister has increased the bureaucracy tenfold as a consequence of the Act and the costs are going through the roof. A fortnight ago my own Nelson City Council announced a 50 percent increase in building consent costs. The Minister of Housing across the road there Maryan Street said that it will cost only $100. What planet is the Minister of Housing on? Under this Government the cost of a building consent is thousands of dollars and the Government is driving it up by thousands of dollars more. 
Hon Shane Jones 
: Where’s the proof? 
Hon Dr NICK SMITH 
: Let me take the Minister through the proof. 
Hon Maryan Street 
: It’s $100. 
Hon Dr NICK SMITH 
: I ask Maryan Street to tell me more. 
Hon Maryan Street 
: $100 
Hon Dr NICK SMITH 
: I will bet that Minister the best bottle of Nelson wine that the 50 percent increase in the Nelson City Council fees is a heck of a lot more than $100. But it is not just the Nelson City Council I say to Maryan Street; the Dunedin City Council has announced increased costs of $1 million a year because of her and this Minister’s Act. I ask Maryan Street who in Dunedin City will pay the extra $1 million a year. Why does the member not take a call? The member is running for cover she is running scared because she knows in her heart of hearts that the Government has made a complete botch of this area of law. 
What we see in this bill is the Government creating a huge Government bureaucracy the Department of Building and Housing. 
Hon Judith Tizard 
: You can’t have it both ways. 
Hon Dr NICK SMITH 
: Judith Tizard would know all about building would she not? Judith Tizard is part of the problem because she and her stupid ministerial colleagues have hugely increased the cost of regulation in the building sector and that increase is now being passed on to ratepayers. She and the Minister on their $240000 a year salaries may not understand that those thousands of dollars of increased costs are hurting people who are desperate to get their own home and are hurting ratepayers. What this bill does is dump on to the councils the costs of accreditation for the building consent process. What that means is that $4 million of Department of Building and Housing costs is being dumped on to the councils at the same time that this Government says it will make homeownership more affordable. Hang on a moment: the Government increases its charges by 50 percent then says: “Oh we care about housing affordability.”! In the last census we saw the biggest ever drop in homeownership since the census included the homeownership question. 
Hon Shane Jones 
: It’s the market. 
Hon Dr NICK SMITH 
: Oh Mr Shane Jones says it is just the market. Let me explain why it is not. When the Government puts up as it does in this bill the building consent fee by 50 percent who pays that? 
Hon Shane Jones 
: 101economics. 
Hon Dr NICK SMITH 
: The Minister says “101 economics” pays it. Actually the building consent applicant pays it. I have another question for the Minister: in 2002 this Labour Government changed the provision for development levies and said that it would put the cost on to the developer; what does the Minister think the developer did with the cost? We have seen development levy costs increase from $8000 a section to the latest figure of $26000 a section. 
Hon Parekura Horomia 
: Oh no! 
Hon Dr NICK SMITH 
: The member Parekura Horomia says “Oh no!”; those figures are from Local Government New Zealand. This Government’s legislation resulted in the development levies going up from $8000 a section to $26000 a section. Who does the Minister think paid that increase? This Government changed the legislation with the result that those fees increased; who do those members think paid that increase? 
Hon Shane Jones 
: Infrastructure levy. 
Hon Dr NICK SMITH 
: The member Shane Jones says “Infrastructure levy.” Yes and it has gone up from $8000 a section to $26000 a section. Could it possibly be that it has actually put up the price of sections? Could it possibly be that the developer passed that cost on? Or does the Minister think the developer community decided to absorb that extra cost of $16000? Let me tell Mr Jones the figures. When Labour came to Government the average cost of a section in New Zealand was $76000. The cost of a section today is $186000. 
Hon Shane Jones 
: Supply and demand. 
Hon Dr NICK SMITH 
: Who is cutting the supply? Whose Resource Management Act is making it slow and expensive to bring new sections on to the market? This Government’s Act. Who has amended the Resource Management Act to make it more difficult than ever to get sections through? Who has passed Building Act amendment after Building Act amendment that has driven up the cost? This Government has. I say to the Minister in the chair that the next time he wants to give a speech about housing affordability he should have a damn good look in the mirror because this Government’s resource management policies and building policies have made homes for average New Zealanders more unaffordable than ever in our history. 
I challenge the Minister to say whether anything in this Building Amendment Bill will make homes more affordable for struggling Kiwi families. The answer is there is nothing. The answer is that it will make it worse. This bill is just another exercise in red tape and is putting more costs on the building sector. My contacts within the building sector say that the industry is in crisis. The industry is so buried in red tape that more tradesmen are leaving New Zealand to go to Australia than at any time in recent history and that is because of this sort of impractical bureaucratic red-tape legislation which is doing so much harm to our building industry. 
The National Party is saying that help is on the way. There is a mood out there in New Zealand for change a mood against the bureaucratic red tape unaffordable sorts of policies that we see in this bill. The best hope for those young families who are striving to own a home is a tax cut fair interest rates and sensible reform of the Resource Management Act and the Building Act to make homes genuinely more affordable. 
The last point I want to make is this. We know and the record shows that homes have become more unaffordable during the 8 and a bit years of this Government than they have been under any other Government on record. If members ask the Parliamentary Library for the statistics they will find that this Government has the worst record on home affordability of any Government in New Zealand history. Why would we trust this Government to try to address that situation? This bill should be rejected. A very different bill is needed.