Weathertight Homes Resolution Services AMENDMENT Bill — Second Reading 
Weathertight Homes Resolution Services AMENDMENT Bill — Second Reading 
[Volume:636;Page:7157] 
Weathertight Homes Resolution Services AMENDMENT Bill 
Second Reading 
Hon CLAYTON COSGROVE (Minister for Building and Construction) 
: 
 I move  
That the Weathertight Homes Resolution Services Amendment Bill be now read a second time 
. Firstly I thank the Social Services Committee especially its chair my colleague Georgina Beyer for the thorough work that she and the committee have undertaken in respect of this bill and for enabling the bill to be reported back to the House before Christmas. I also thank the submitters for their valuable input and feedback on the bill. I take this opportunity to remind the House briefly of how this bill came about and of what it contains and to summarise the select committee’s recommended amendments. 
The bill improves the effectiveness and efficiency of the Weathertight Homes Resolution Service through reform. It is essential to the Government’s commitment to provide a speedier low-cost alternative to the court system for resolving leaky building claims. The Weathertight Homes Resolution Service was set up in 2002 as a call to arms by the Government to deal with a major problem in our communities. This problem was not caused by any one factor; rather it was a systemic problem caused by a large number of factors but primarily and in large part historically by the deregulation of the 1990s which let the cowboys into the system and allowed them to run amuck within the building industry. In August 2005 a major review of the Weathertight Homes Resolution Service was undertaken which found the service wanting in several areas and the process being unnecessarily drawn out by lawyers and other experts. 
The bill will help the owners of leaky homes to settle their disputes faster hold those responsible—that is the liable parties—to account and get compensation from those liable parties to fix leaky homes faster. It will also enhance consumer protection for homebuyers. In developing these changes we consulted widely with organisations including the Leaky Homes Action Group and the Consumers Institute of New Zealand as well as building industry organisations and local government. Their collective input I have to say was invaluable in developing the policy that underpins this bill. 
As I have said the bill aims to improve the efficiency and effectiveness of each stage within the Weathertight Homes Resolution Service’s process. The reforms include allowing claimants to claim for potential as well as actual damage more comprehensive assessment reports that can become expert evidence thereby cutting down legal costs substantially for claimants and faster resolution of disputes through the introduction of compulsory pre-hearing conferencing for standard claims before claims move to time-limited mediation plus the fast-tracking of low-value claims. The bill sets the objectives for a less adversarial more investigative and swifter adjudication process. The bill introduces new offence provisions with fines attached to behaviours such as failure to comply with an adjudicator’s order or summons. That will help adjudicators to get on with the job. The bill also seeks to make the adjudication function independent of the Department of Building and Housing. The Ministry of Justice will be responsible for establishing and administering the new Weathertight Homes Tribunal. These measures will enhance consumer and respondent confidence in the adjudication service improve acceptance of the authority of the adjudicators and provide more institutional support for the adjudicators themselves. 
The bill removes the obstacles encountered by bodies corporate that wish to bring claims for multi-unit apartment complexes by setting voting thresholds that are not unanimous so that the so-called hold-out situations are less likely to occur. That is especially important given that around 70 percent of claimants with the Weathertight Homes Resolution Service are unit title apartment owners. 
This legislation was introduced to Parliament on 23 August this year and received its first reading on 31 August. The House set a shortened report-back date for the select committee. The committee has met that deadline and I am grateful for that. I thank members for their effort. The goal of having this bill passed before the end of the year and the reforms in place by April next year was ambitious but with the support of the committee and this House today I believe we will get there. Submissions made on the bill represented individuals consumer groups insurers the industry and organisations that represented many individuals. All of the submitters who asked to be heard by the committee were heard and there was general support for the majority of changes the bill proposes. There was unanimous support from the select committee for the bill as a whole. However I will come to some points later. 
One change made by the committee was to extend the land information memorandum—or “LIM”—notifications to existing claims. The committee sought to extend consumer protection by including existing claims—not just those claims made after 1 April 2007 as was originally proposed—on the land information memorandum reports. The committee also agreed that the Weathertight Homes Resolution Service will send a notice when a claim is brought instead of after it has been decided it is eligible. That is the best way to ensure people do not withdraw from the claim process and onsell their property without disclosure to unsuspecting buyers. The bill reflects and enhances current practice by territorial authorities. 
Other changes include a provision that where a claim is determined to be ineligible under one provision claimants can withdraw and bring back the claim under the correct provision provided it is submitted within 1 year. That will help claimants who are close to the 10-year limit for filing claims with the resolution service. Other changes include enabling the Chief Executive of the Department of Building and Housing to access information about mediation settlements for research and evaluation purposes; appointing a registrar for the new Weathertight Homes Tribunal; allowing settlements made by the resolution service to be enforced in the District Court; appointing additional adjudicators to complete any claims remaining under the previous system; and amending the commencement date to 1 May 2007 or earlier by Order in Council. I have to say that is a backstop provision. The Government intends to meet its commitment to claimants that the enhancements to the resolution service will be implemented by 1 April 2007. 
Some additional issues which were not part of the bill came up during the select committee consideration and were considered carefully. The committee decided unanimously that the 10-year limitation period which applies right across the building sector will remain in place. It decided by majority that legal costs should not be able to be claimed under the resolution service dispute resolution process. The committee took on board the comments made by submitters that it should make the bill more accessible in terms of using plain English and grouping related provisions together. To that end the committee therefore decided that a new bill was needed incorporating the amendment bill into an integrated new bill. 
The Government agrees with all the recommendations of the select committee. The Government is also putting forward Supplementary Order Paper 83 which deals with technical amendments to the new bill to improve its readability correct minor errors and ensure provisions are consistent across the various types of claims. 
To conclude the bill as reported back proposes in my view a large number of positive changes. Not only will the legislation improve the speed and efficiency with which weathertight homes claims can be dealt with it will also reduce evidential and legal costs for claimants and respondents reduce bureaucracy and be fairer for both claimants and respondents. I again thank the select committee and my colleague Georgina Beyer the chair of the committee for the cooperation they showed to ensure the bill met the report-back deadline. With the indulgence of the House we can have it passed today and thus enacted before Christmas. 
Hon Dr NICK SMITH (National—Nelson) 
: 
 This bill does contain some small and useful improvements in the process for settling leaky home claims but if members believe that this is the solution to this billion dollar - plus problem they are kidding themselves. I want to recite for this House the appalling record of the Government in dealing with this problem which is so adversely affecting the life and the biggest investment of thousands and thousands of New Zealanders. 
Let us first front up on the issue of just how much the Social Services Committee has changed the bill. Whereas the Minister introduced a bill of 42 clauses the select committee is proposing as stated in the commentary on the bill that it would be better to omit clauses 3 to 39. In fact the only clause proposed by the Minister to have survived select committee scrutiny is the title clause. That is failure by anybody’s standards but I am not surprised. If we recite back to the end of 2002 this Government in a knee-jerk reaction rushed through legislation passing the Weathertight Homes Resolution Services Act. That legislation never went to a select committee. It was before the House for only 2 weeks and here we are again 4 years later under urgency in Parliament ramming through legislation to fix this problem. I say to the Minister the Hon Clayton Cosgrove: “You have learnt nothing.” We know that the first Act was a failure; his bill as much as admits that. So why would he a second time round under urgency attempt to try to come up with another solution and rush it through? 
Let us just look at the record of the Government’s Weathertight Homes Resolution Service. To date in the last 4 years there have been 3800 claims. Since Clayton Cosgrove has been the Minister 184 claims have been settled and there have been 437 new claims. I tell the Minister he is going backwards. Over twice as many new claims have been lodged since he has been the Minister compared with the claims that have been settled. But the real scandal is this: the average settlement has been just $68000 for the homeowner to try to fix the leaky home. For each of those settlements the Government has spent $96000 on bureaucracy on reports and on the Weathertight Homes Resolution Service. I say to members of this House that it would have been better to send a straight cheque of $96000 for each of the claimants than it would be to fund the bureaucracy and the failure of this particular agency. 
Then we have this ridiculous game of “pass the hot potato” within the Government. We have had seven Ministers in 7 years in respect of this problem of leaky homes. We had Mark Burton. He passed the problem to George Hawkins. George Hawkins passed the problem to Lianne Dalziel. Lianne Dalziel passed the problem to Margaret Wilson. Margaret Wilson passed the problem to John Tamihere. John Tamihere passed the problem to Chris Carter. And Chris Carter has now passed the problem to Clayton Cosgrove. 
 Can anybody in the Government and particularly the Prime Minister who is responsible for allocating portfolios tell me how it helps any of these desperate homeowners to have this problem passed from Minister to Minister? But the Government has not stopped even there. The problem has passed not only from Minister to Minister but from department to department. The problem started off as being the responsibility of the Department of Internal Affairs. Then the Government decided that no it should not be there that this problem should be with the Department of Building and Housing. Now the Minister is telling us that the Government is going to pass it on to the Ministry of Justice. Well I have to tell the Minister that homeowners have had a gutsful of this problem being passed from one to another without solutions and doing so again will not make any material difference. Then we have not surprisingly given Clayton’s previous job as a— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: The member must use the Minister’s full name. 
Hon Dr NICK SMITH 
: —given Clayton Cosgrove’s previous job as a spin doctor the new answer that we are not going to call it a Weathertight Homes Resolution Service any more; it will be the Weathertight Homes Tribunal. Well now that will solve the problem will it not? Let us change the name. I tell the Minister that this is an organisation that has been in place for only 4 years and all he is doing is changing the name changing the Minister changing the department and not providing real solutions. 
I will quote for the House from Local Government New Zealand because in its submission it really does sum up the failure of this bill: “the Bill focuses on process and does not address the legal issues at the end of the claims process around getting the homes repaired. We strongly recommend that consideration be given to the most efficient use of the government’s investment in weathertightness issues to achieve the objective of actually getting the leaky homes fixed. We do not believe that the current proposals effectively achieve this fundamental objective.” Here we have New Zealand’s 85 local authorities saying that this bill fails because it will not get the homes fixed and in that respect they are absolutely right. 
Let us just highlight the latest figures from the Weathertight Homes Resolution Service. I remind the House that this is an agency that this Parliament and taxpayers have provided $17 million a year for. The question I ask is whether we have got $17 million worth of value. The figures have been released. Does the Minister know how many cases have been settled in the last month? We know that there are over 3000. In the last month nine answers have been provided. If one works out the $17 million a year that is about $1.5 million a month. So for $1.5 million the Minister has settled nine claims in the last month. That is over $150000 per case. It is even worse than the record of his predecessor Chris Carter when it was costing $100000 to settle each claim. That is the extent of the failure we have with this bill and with the service. 
All the submissions to the Social Services Committee whether from the Leaky Homes Action Group Local Government New Zealand the Registered Master Builders Federation of New Zealand or the Certified Builders Association—I could go on and on—asked the Government about providing a mechanism that will get the houses fixed and we have had no answers from the Minister. National for instance is sympathetic to the leaky-home owners who actually think that legal costs should be able to be reasonably claimed. I have heard of cases that have been adjudicated with 18 lawyers in the room representing the developer representing the builder representing the architect representing all the building professionals representing the insurance companies and representing Local Government New Zealand. Government members expect with 18 lawyers in the adjudication hearing the homeowners to be able to win the argument all by themselves. Well they are in fairyland. They are on the wrong planet. They are not on the side of those Kiwi-battler New Zealanders who have these leaky homes and need genuine help to get fair and just solutions. 
I challenge any member of the Government to explain to this House how any average homeowner is meant to get justice out of a process when lined up against 18 lawyers who are well funded by local government and huge insurance companies. It is simply unrealistic and is not the way forward. We also think there is a real argument to be had around limitation. The reality is that a home is built for 50 years and to limit the time when the claims can be made is not going to see a fair solution to this. This bill is an indictment on the Government’s resolution service set up in the 2002 Act. It contains a few useful provisions. It is not an answer and sadly I can tell the Minister that the House will be debating further changes within a year or two because this bill does not provide the mechanism to fix the homes. 
GEORGINA BEYER (Labour) 
: 
 It is a privilege to rise at the second reading of the Weathertight Homes Resolution Services Amendment Bill. As chair of the Social Services Committee may I acknowledge the general cooperation from all of the committee frankly to process this bill speedily. I particularly thank the officials from the Ministry of Justice the Department of Building and Housing and the Parliamentary Counsel Office for the intense amount of work they had to do in a relatively short time. 
The committee received the bill on 31 August and the closing date for submissions was 6 October. We received and considered 27 submissions from interested groups and individuals and we heard 23 of those submissions. There was great sympathy as we heard the submissions particularly those from people who were direct victims of the leaky home problem. The committee was very resolute in its decision to process this bill as quickly and expediently as possible but not by doing a once-over lightly. 
It was also an advantage to have on the committee a member in the form of Paula Bennett who had actual experience of the leaky home problem. To Ms Bennett’s credit she declared that possible conflict of interest but it turned out to be helpful to have someone who had that experience and she brought to bear that particular perspective without it prejudicing in any particular way the committee’s decision. So that was helpful. 
The member who has just resumed his seat waxed lyrical—it was a typical filibuster speech from Nick Smith—and highlighted all the problems and issues the Opposition wished to debate but he gave not one idea as a solution. Perhaps we may be enlightened further on. The basis of what has happened occurred over the 1990s in particular and up to recent times. This Government has indeed progressed the issue no matter what feelings of derision the Opposition may have about slowness. The Opposition may say it is not enough—it is never enough—but it is more than we had before. 
One of the important aspects decided by the committee was simply that the bill would supersede the principal Act. The bill as it has been returned to the House will now become the primary Act as opposed to an amendment to the primary Act. That is quite major and a lot of work had be done by various officials and the Parliamentary Counsel Office in particular to get that rewrite—for want of a better term—completed so that we could process the bill as quickly as possible. 
The committee gave an undertaking to submitters particularly in the final hearing but generally to all that we would report this bill back by 4 December. Indeed we happened to report it back a week earlier than that. That I hope highlights the commitment the committee had to seeing it happen. All that is left now is to hope that the bill will proceed expeditiously through its Committee stage and third reading and be completed by the end of today’s session. With that I thank you. 
SUE BRADFORD (Green) 
: 
 The Green Party continues to support the passage of this Weathertight Homes Resolution Services Amendment Bill as it progresses through its final stages in the House today. Although submitters to the Social Services Committee were on the whole quite critical of the inadequacies of this and previous relevant legislation at the same time there was an overwhelming indication that it is better that the Government do anything it can to improve streamline and speed up dispute resolution processes on this issue rather than just leave things as they are. Some of the submissions were quite harrowing coming from people who had lost everything or almost everything through ending up stuck with an expensive home that had lost almost all of its value and without recourse to anything like the amount of compensation—if any at all—necessary to fix their problems. I think every member of the select committee no matter what political party he or she came from felt tremendous sympathy for such people of whom of course those speaking to us represented just a tiny fraction. 
Over and over I thought back to what it was like in Auckland in the 1990s and reflected on those massive developments that we saw going up all around us at the time. I will never profess to being an expert on building materials or construction issues but even so I remember how at the time I was totally suspicious about the nature of so much of what was being built. So many of those new housing developments looked inadequate and shonky and ill-suited to the wet reality of Auckland’s weather. They were real disasters waiting to happen. 
We heard a lot about culpability and blame during the select committee process and I certainly do not think it can be sheeted home in any one place. Overall it seems in retrospect that a big part of this sector in the 1990s was blighted by a blindness to the reality of what construction types and materials work in our climate and by a drive to profit at any cost in the excitement of a newly deregulated market place. In 2002 the Hunn report named this as a major systemic breakdown across the whole building industry. After hearing the submissions on this bill and the desperation of so many homeowners and local authorities caught out by what has happened I can only agree. Instead of using the tremendous growth in building developments in the 1990s as an opportunity to learn and put into practice sustainable building techniques for the future the opposite happened with results that affected and desperate homeowners are still having to live with today. 
Within this context the bill before the House this morning is welcome with its focus on improving the system for resolving leaky building claims submitted to the Weathertight Homes Resolution Service. The Green Party supports the substance of what is being achieved here including the goals of reducing the time it takes for claims to be resolved thereby cutting the costs for homeowners in taking claims; encouraging the resolution of disputes through early negotiation between parties as much as possible—especially for lower value claims—and removing some existing barriers to the registration of claims and resolution of disputes by owners of units within multi-unit apartment complexes. We believe that it is critical that the existing resolution service processes are improved so that in the end people’s homes can be repaired more quickly and the associated trauma brought to an end with as much speed and as much support for the homeowners as is practicable. 
I know that this bill is not perfect but I think it is incumbent upon the Government to do what it can. A huge range of complex issues were brought out by this bill and the select committee process was notable for me in being the first time I had seen the situation arise where an amendment to a principal bill was so complex and confused that in the end counsel had to redraft and amalgamate the whole bill into a new Act. On top of that a number of amendments were made during the select committee process in response to submitters and to the committee’s consideration of the bill and even further amendments have since been put up by the Minister for Building and Construction to be dealt with by way of a Supplementary Order Paper today. Some of these changes which we support include the extension of land information memorandum notifications to existing active claims already in the system a requirement for claimants who bring a new claim under different eligibility criteria to do so within 1 year which provides certainty as well as allowing claimants to extend the period within which they can bring a case and the provision of clarifying clauses and a useful diagram in schedule 2 to help make the process clearer for all concerned. 
When I originally spoke on this bill I was like many submitters concerned about the 10-year limitation period which means that any leaky building claim must be brought within 10 years of the home being built or altered. However after learning more about this issue during the select committee process I have come to understand and accept that for the most part there are good reasons for this limitation including the fact that it is very hard to determine liability after 10 years that it is difficult if not impossible to collect adequate evidence after such a long time and that it is a provision that already applies to other claims in respect of building work. On top of that we were told that research and the Hunn report itself show that if there is a problem with a home it should be showing signs of it well within the 10-year time frame and that it is actually better for all concerned if people make their claims as soon as the problem appears. 
Another big issue for claimants for which I have a lot of sympathy is legal costs. It has been and continues to be almost unreasonably expensive for people even comparatively well-off people to take claims when legal counsel are involved and are up against lawyers representing every other party. My hope is that the simplification and speeding up of processes implemented by this bill will help to reduce those costs markedly if not altogether—the latter particularly in respect of lower value claims. 
One suggestion from submitters in which I was particularly interested was the concept of setting up a special court for building issues as exists in the UK. I could see a lot of merit in this suggestion not only for dealing with the ongoing leaky homes crisis but for acting in future as a specialist building disputes service within the court system overall. Although the select committee did not see fit or feel able to support that proposal at this juncture and decided to leave the service as a weathertight homes - specific disputes tribunal I am keen to learn more about this concept of a building court and to work with parliamentary colleagues and people involved in this sector towards a possibility of implementing such a court in future. 
In conclusion like the committee chair Georgina Beyer I thank all those who have worked on this complex bill including my fellow select committee members and particularly the officials who put in an enormous amount of work under considerable pressure of time. Above all I would also like to thank the submitters from all backgrounds who took the time to put together often very useful and detailed input to this legislation and to express on behalf of the Green Party my sincere hope that the passing of this bill will lead to the achievement of its goals as soon as possible for the sake of everyone concerned. 
TE URUROA FLAVELL (Maori Party—Waiariki) 
: 
 Tena koe Mr Deputy Speaker. Kia ora ano tatou katoa. A couple of years ago a Labour Minister Dover Samuels spoke out about the lack of progress in addressing housing in Northland Eastern Bay of Plenty and on the East Coast. I absolutely agree with that member. His comments came following the tragic blaze at Herekino which claimed the lives of three children. The comments sat in the context of local general practitioners telling of cases where infections such as meningococcal disease were being spread because of sub-standard housing. This was a time when people were living with no flushing toilets no bathrooms and no septic tanks. In some homes toilet waste was being poured straight into the ground inviting hepatitis A. His comments were based on Labour’s promise to fix 2500 houses but over a year later work had started on only about 250. This was and still remains today the situation for too many Maori families. 
I know how real these issues are throughout my electorate of Waiariki. Indeed just last month I visited Ruatoki. I visited houses in poor condition reflecting low-quality workmanship. Many of them were rotten and leaking. When one house was removed last month it was evident that raw sewage remained. The houses are in a state of disrepair. They have been described as polyurethane Weet-Bix. These are not isolated cases. I am also aware that the community of Waitahanui in Taupo located in papakainga housing has suffered much the same plight as the result of housing being planted on swampland and the impacts of the low water-table. I know of one family forced to live in their sitting room due to the mould and the damp in the other rooms. 
What does this have to do with the Weathertight Homes Resolution Service? Everything and nothing. The Weathertight Homes Resolution Services Amendment Bill has everything to do with addressing the leaky buildings crisis. It has everything to do with considering the wider scope of claims for weathertight deficiencies—deficiencies that cause real damage but as yet there have not been leaks. Sadly it has nothing to do with the deficiencies and damage that are still very much a part of the lot of those involved in the Maori housing story. 
 For evidence of that one need only turn to a report released in August of this year from Charles Waldegrave Peter King Tangihaere Walker and Eljon Fitzgerald. This was a joint collaboration between the Family Centre and Massey University. The report  
Maori Housing Experiences: Emerging Trends and Issues 
 outlines in some 218 pages the following conclusions: “Homeownership rates for Maori are lower than for the general population and have been falling since the 1950s … Overcrowding substandard housing causing health risks and inadequate heating have been identified as issues in need of attention for Maori. Economic conditions and family structure have affected the ability of households to afford adequate accommodation.” 
I come to this bill aware of Standing Order 107 and the need for all debate to be relevant to the question before the House and I ask this House how any member could possibly ignore the realities of lower-grade housing for Maori when we are considering a raft of proposals to enhance the assessment and resolution of leaky building claims for other New Zealanders. 
Let me be quite clear: the Maori Party supports absolutely the objectives of this bill to ensure that departments responsible for administering the legislation will be helpful to claimants. We believe that the public service is honour-bound to provide a service to the public that is efficient respectful and responsive. We welcome the specificity of providing guidance and assistance to claimants to help them to understand their assessment reports and to be aware of the advantages of early negotiation and to make the process faster and less costly. Surely these are the hallmarks of a transparent and accountable public service—that every effort is made to improve processes and to enhance case management. 
We are also pleased that the bill actually tries to do something about the recommendations from the 2002 Hunn report and the 2003 Government Administration Committee inquiry. The Hunn report identified the factors that contributed to leaky buildings and issued 25 recommendations to address the systemic failures within the building industry. The Government Administration Committee inquiry resulted in some 63 recommendations notably the significance of the development of consumer protection measures. So all up 88 recommendations later we have a substantial body of evidence about the need for speedy flexible and cost-effective procedures for the assessment and resolution of claims. 
Who could possibly argue with initiatives that try to improve protection for customers such as is envisaged by placing notices of Weathertight Homes Resolution Service claims on land information memorandum reports or the fact that the service will provide free assessments to determine the extent of water damage to affected homes and will provide access to mediation and adjudication services to help resolve disputes? Certainly not the Maori Party anyway. 
We support the establishment of a new Weathertight Homes Tribunal to provide strengthened adjudication services for consumers and we support the intention for the model of dispute resolution to be based on a more investigative approach. We believe that the proposals seem comprehensive and will do much to clean up the deregulation of the building industry. 
But I return to the concerns raised by Mr Samuels—the report I outlined earlier. To put the call—when will one standard of law also apply in the case of Maori housing? The study of housing experiences I referred to earlier builds on four crucial elements: literature review; analysis of census data; analysis of data from the Te Hoe Nuku Roa a longitudinal study of Maori households; and qualitative field study. The qualitative sample included six regions involving 70 people and eight focus groups. It was a very strong source of support to provide a basis on which to develop housing options for Maori from now on. 
The question we would ask is how this Government can justify spending $76 million on the Weathertight Homes Resolution Service since 2002 yet turn a blind eye to the fact that New Zealanders are squatting in shacks and caravans that families are squeezed into pensioner flats and that there are over 2250 run-down homes on the sub-standard list. The Maori Party housing policy makes an explicit commitment to ensuring that Maori housing experiences and realities are adequately researched and addressed. The study I have referred to in the House makes a significant contribution we think towards this goal. We believe that we must engage and encourage Maori participation in order to produce enduring housing solutions. We support the Weathertight Homes Resolution Services Amendment Bill but we also place on record the urgent and ongoing need to make sure that the issues associated with Maori housing are given the due and serious consideration that they deserve. Kia ora tatou. 
PAULA BENNETT (National) 
: 
 Thank you for the opportunity to stand and speak on this Weathertight Homes Resolution Services Amendment Bill. I am the person whom the chairperson of the Social Services Committee was talking about earlier who actually has a leaky home. I start by acknowledging that and by saying that we have chosen not to use the service because the building is a multi-unit. We are taking the matter to the High Court because we felt that the service was not capable of addressing our needs and we certainly still feel that way. 
Unlike the Minister I would like to do more than just pay lip-service to the submitters and the thousands of people out there who came to us with personal stories and who stop us in the street to talk about the effect this issue has had on their lives. They are truly the blameless victims. In many cases they have invested everything they had to try to have a home that they could live in and pay their mortgages on. They went forth in all good conscience to do the right Kiwi thing and now find themselves in financial ruin and absolute emotional distress. They deserve to be acknowledged and acknowledged properly by this House—not by the tinkering that is currently being done with this bill. This bill does not work for anyone and we have heard that time and time again. It does not work for the councils and ratepayers it does not work for the builders it does not work for those who sell building products and who have got it wrong there and it most certainly does not work for those homeowners who find themselves in this predicament. 
Like my colleague Dr Nick Smith I was appalled when I looked up the numbers yesterday and found that to date only 7.6 percent of claims have been resolved. I stand here and as politicians I feel that the few changes that are being made are being done just so that Government members can stand up and say that they are actually doing something. In particular the Minister can now walk around and say that the Government has tried to fix the issue by trying to speed up the process and trying to make it more efficient. The words that kept springing to mind when I was listening to Sue Bradford give her speech were “I hope” and I also heard from the Maori Party “We hope”. We hope that this bill does something for the homeowners but we do not have faith that this measure is what is needed. 
It is the sort of thing we have just so that a politician like the Minister can sit there and feel better. People may have seen him on the telly a little while ago where he squirmed when he was faced with those personal stories of financial ruin and when he was faced with the emotional stress. Now what he has done is to put forward a bill that tinkers around the edges of the problem. It does a little but it does not do what is needed to be done which is a lot. This is an “Avoid Bill”; it avoids the realities of what is really happening to New Zealanders it avoids the total reform that is needed and it avoids the fact that this legislation is merely tinkering around the edges. 
Hon Clayton Cosgrove 
: Tell us what you’d do. 
PAULA BENNETT 
: We will support it because we will not play with homeowners. We will not play the political buying going to and fro. We will find those who are caught in this web by doing the politics within it so we will support the Government’s amendments because—like other parties in this House—we hope. We hope that this bill might do something for those homeowners. 
Let us deal with some of the facts. The bill wants to encourage parties into mediation. Let us get real! Who would go alone against myriad lawyers and experts? I asked the Minister whether he thought for one moment that councils would not bring along all their lawyers and experts to fight cases—and in many respects the councils would be doing their ratepayers a disservice if they did not front up with all those experts and lawyers. And now the Government is asking those homeowners to front up to them alone. The victim does not have the buying power to provide for a balanced adversarial hearing or mediation and is more often than not bullied into accepting a lower than reasonable settlement just to come to a conclusion. The Minister is expecting those people to front up on their own. 
What about legal costs? What about the Government fronting up and helping these people so that they can help themselves? How about fronting up with legal costs for those homeowners who need it? I tell the Minister that the action group advises people not to go mediation and not to take their case because they will not be able to front up on their own and in many cases cannot afford the lawyers to see it through. At this stage we have huge concerns about the adjudicators. Only two of the adjudicators have building backgrounds—all the others have only legal backgrounds. Only two have the knowledge of the industry that is required to make these decisions. 
The other question I have is why so many claims are not being pursued. Why are they not being followed through? It is a serious question. Have these claims miraculously been resolved? Have these buildings been fixed? Is that why these claims are going away? Or is it because these victims have no one to claim from? Is it because some of those dodgy builders that the Minister speaks of have closed their businesses done a runner and left the victim with a leaky dangerous home and no one to be accountable for it? The Minister is nodding—he agrees that is the case in many instances. I ask the Minister what he will do about it. What will he do about standing up for these homeowners who need something? The answer is quite simple is it not? The answer is nothing. The Minister will avoid the real issues facing these homeowners and do a bit of tinkering around the edges on a bill that he hopes will work. 
I feel for the builders and tradespeople who want to be accountable and who want to front up and fix these problems who were perhaps sold products—like timber cladding and all that sort of stuff—that were faulty. I feel for those builders who want to do something. We have to be concerned for the councils who are often left dishing out thousands and thousands of ratepayers’ dollars because they are the only ones standing. What will the Minister do to fix the real issues? 
The Greens asked us to please look at a building court. How about we look at a building court? How about we look at addressing the real issues? How about a building court where we do not look at these issues as if they were in the future where we do not talk about the issues all around the edges and where we face up to the realities of the billions of dollars needed to fix these homes? The homes clearly are not being fixed. The Minister should ask himself the question of who will do the remedial work. Which builders will want to front up and be the ones fixing others’ work that has gone wrong and then have the checks and balances come in after that? 
Of the changes to the bill let us talk about the land information memorandum notifications to start with. Notifications in respect of claims must be placed on the land information memorandum for the particular property. We had expressed concerns about this issue. We felt that for the owner who is coming in and for the buyer who wants to purchase a building there needs to be some form of recognition that there has been a claim against the home. We also had a lot of questions about the limitation period on claims. I personally heard the submissions of people who had very real concerns about that 10-year limitation and whether it would go through. Upon advice from the advisers who did an outstanding job in getting this through in the time they needed to it was a number of other concerns—as has already been addressed by my colleague in the Green Party who sat with us on the Social Services Committee—that there was too much and that we could not go outside that limitation period. 
Next I come to the multi-unit claims. This is an interesting issue in which we have more of the same concerns. The Government would like it that 80 percent of people in a multi-unit—if that is what the body corporate says—have to agree on something before they can take it to the Weathertight Homes Resolution Service. One has to ask how these claimants can get to a place where there is agreement. In my case for example there are 87 of us who own apartments within an area. How are 80 percent even of 87 of us going to agree on what the costs are? We do not all have the same concerns—not all of the apartments are leaking in the same way in the same place or in the same areas—and yet we are expected to agree and then take our case. 
Let us imagine if we did take our case to the Weathertight Homes Resolution Service—which as I say we will not. How will this legislation tie up a service that is not meeting the needs of leaky-home owners now when we see only 7.6 percent of claims being resolved? Now we are throwing in multi-units and the substantial—huge—needs that they will bring before the service. We have huge concerns about the realities of much of this legislation. 
The Minister has stood before us and presented this bill. We hope that the new system is faster we hope that it is speedier and we hope that it actually lives up to some of the expectations of some of these homeowners. But it will not. 
PITA PARAONE (NZ First) 
: 
 Tena koe. On behalf of New Zealand First I say that we will certainly support this bill notwithstanding some of the comments that have been made by people who sound as though they are actually opposing the bill and yet whose friends—and even the member Paula Bennett herself—will certainly become beneficiaries under this legislation. 
There are a number of reasons why we support this bill. Firstly we heard from a previous speaker that there were 3800 claims and that 134 have been settled but that another 437 new claims have been made. I suggest to this House that it is important to have appropriate legislation that will address that particular issue. We in New Zealand First believe that this legislation will do that. Secondly this legislation is not about providing obstacles to homeowners but rather about drilling to those who are responsible for this issue. That may include builders developers and even architects. Thirdly this bill is not about poor workmanship but more essentially about addressing the use of poor material. We need to make sure that similar material is not used in future. 
I also make the point that this bill is not about race as some earlier comments in this House might have suggested. In fact if Maori are affected by the leaky homes syndrome then they have equal access to Pakeha to what this legislation will provide. 
Although New Zealand First was not represented on the Social Services Committee we want to acknowledge the fine work the committee has done. It saw that the original bill needed a replacement as its report back has recommended. Clauses 3 to 39 will be replaced by new clauses to include all the elements of the bill and everything that is in the principal Act. New Zealand First as I said did not have a member on the select committee but after having read its report we feel confident in supporting the passage of the bill though this House. We are confident that this bill fulfils its aims which are to improve the experiences of those unfortunate enough to own a leaky home and who are seeking redress and resolution through the Weathertight Homes Resolution Service. The system now allows for a smoother and more transparent system than that previously in operation. I think that the comments made by a previous speaker certainly validate what I have said about that. 
The bill addresses a number of issues and I want to comment on one or two of them particularly in terms of the land information memorandum notifications. The Chief Executive of the Department of Housing and Building and the tribunal will be required to advise territorial authorities of all leaky home claims. It is important that any purchaser of such a home is made aware of this particular issue regarding the land information memorandum notification. Failure to do that will certainly do an injustice to people who are contemplating the purchase of such homes. Of course there will be no delayed notifications and the information must be placed on the property’s land information memorandum. 
We heard comment in relation to multi-unit claims. While I can sympathise with some of the comments made about the difficulty of getting a minimum of 80 percent approval of a particular issue I say that what the bill has put in place is much better than what was previously there. The important thing is to ensure transparency accessibility speed and simplicity for those who need to use this service remembering at all times that those people are victims of a system in which this fiasco was allowed to happen. 
Comment was made about whether it should be the tribunal system or the court system that is used and about the fact that some homeowners may not be able to afford legal representation. At the end of the day it is the choice of the individual homeowner to decide whether he or she wants to take a claim to the tribunal or to the High Court. I suggest that those who take it to the High Court will certainly have legal representation. 
There are many lessons to be learnt from the leaky homes saga not the least of which is that we should remember when deregulating and privatising that the regulations were put there for a purpose. It was never in anybody’s interest save for the sharks in the industry to relax the regulations in relation to the building and construction industry. I trust that this sorry episode in our history is now put to rest permanently. 
The commencement dates as outlined in the bill are certainly relevant in terms of the comments that have been made in the report. It is important that the effects of this legislation are put into action immediately. I think the suggested start date for the tribunal is 1 May 2007. Although we would have liked the date to be much earlier than that the actual process of getting legislation into the system will require that sort of time frame. 
I also noticed with regard to the building tribunal some submitters suggested we should adopt the approach currently being used in Britain. This bill is intended to establish a specialist tribunal that will develop expertise in leaky building cases so that it can provide relatively timely and low-cost resolution of such disputes. 
Paula Bennett 
: They haven’t got the expertise. 
PITA PARAONE 
: It will have. I am sure that as an affected homeowner the member would claim to have some expertise on the problem. We are seeking expertise on how to solve the problem. 
As to the 10-year limitation period for submitting claims I say we have to draw the line at some time. I am not sure whether the 10-year period is the appropriate one but we have to set a time frame or otherwise it may be like Waitangi Tribunal claims. So we have to put in a time frame to be consistent with that. 
New Zealand First members have one or two issues we would like to raise during the Committee stage but suffice it to say that we will support this bill. 
JUDY TURNER (Deputy Leader—United Future) 
: 
 I rise on behalf of United Future to speak on the second reading of the Weathertight Homes Resolution Services Amendment Bill. It is a necessary amendment bill. In fact it is more than an amendment; it is a replacement for the original Act. 
United Future supports the bill but like others in this House we agree that it is not a cure-all for the matters related to leaky homes. We support the inclusion of relevant information on the LIM report as a positive step although I looked back over the notes I took during the submissions and saw an interesting suggestion made that the information should go on the certificate of title based on the fact that very few people actually get a LIM report. There are some ongoing challenges for those with multi-unit dwellings and this amendment recognises some of those difficulties and makes a start towards dealing with those concerns. 
Like others I want to thank the select committee; it was an enjoyable working process. I would like to thank the submitters and the officials who gave us advice. 
However the lesson does not go away with the passing of this amendment. The ongoing issues regarding housing design building methods and building materials remain. I still remember driving around a new housing division looking at new designs. I have a husband who is a very practical handyman and he was not as impressed with the new designs as I was. He had some real reservations about what might happen. It sounds as if a lot of people had those kinds of reservations and we are now bearing the consequences of some very poor thinking in that regard. 
In New Zealand homeownership has always been a bit of an excuse for low levels of saving towards retirement and that is why the leaky homes problem has been such a crisis for those people affected. I agree with Paula Bennett that it is important during this second reading not to trivialise the suffering of people with leaky homes. Their homes represent their hard work and their future security and for those people that has been crumbling before their eyes. 
The need to deal with future potential damage came up during this amendment bill. Of course these issues have to be balanced against the normal deterioration of natural products like timber in the life of a home. Forecasting is difficult but establishing damage is absolutely pivotal to the process and this bill seeks to better facilitate that process. 
One of the other issues that comes up in regard to that—and certainly several submitters mentioned this—is the need for better education for New Zealand homeowners about the maintenance of their property. Homes do not last forever but they certainly last a lot better with a regular coat of paint if that is the material the homeowner has chosen to use and with some basic practical maintenance being done to them. I think there is very little education and people often expect much greater longevity from a home than it is capable of delivering. 
The issue of making sure homes are properly fixed after the settlement is one that still concerns United Future members. We think that some ongoing work on this matter should be encouraged. Certainly the Wellington City Council and a number of the other city councils that made submissions had ongoing concerns about the fact that their housing stock in their towns particularly those that had claims made against them in some cases remained unfixed even after settlement. I think the slowness of the process up to date has contributed to that. It has meant that when people have received some compensation much of it has had to go towards other bills sustained during the process like legal costs and therefore homes have remained either partially or completely unfixed. There is possibly a need to look at the joint fund currently used by local government instead of individual insurance policies being used. There is concern about the fact that that fund is fast running out. 
At a later date we also need to reflect on some of the submissions from builders. They said they would like some additional clarity as to when an individual builder can be held to be negligent as there is still a lack of clarity around that. They also asked that builders be included earlier in the claims process than they currently are. Sometimes they do not even know that a claim has been taken out against a building they were responsible for building. They believe that if they were included they could firstly with their knowledge of the building throw some light on the damage occurring. They also said that if they were included at an earlier date many of them would want to jump in and get the problem fixed before it progressed and before there was further deterioration to the building. 
I think that a number of matters that came up at the Social Services Committee warrant some further consideration. However that being said I believe that this is a move forward in the right direction. It is not a big enough move but we will support it because of the good it will bring to the process. 
Bill read a second time. 
Name changed to Weathertight Homes Resolution Services Bill.