Willis NicolaNICOLA WILLIS (National): This bill contains what the Government hoped would be their dirty little secret. That secret relates to the way that Ministers wanted to fund a land purchase at Ihumātao. I want to take the opportunity in the House today to set out for this House and for members of the public the disingenuous way that the Minister of Housing together with the Minister of Finance set out to I believe intentionally pull the wool over the eyes of New Zealanders about how the purchase of land at Ihumātao would be funded. What this bill does is it confirms Parliament's authority for spending last year that was authorised in the interim under last year's imprest supply bill. Contained within it is a specific new appropriation a supplementary appropriation that was not contained in last year's Budget and that is a specific appropriation of $30 million to purchase land from Fletcher Building at Ihumātao.Now that line item almost didn't make it to this bill and I want to traverse why that was because this is a matter that you would have thought was very straightforward if you were to simply interpret the press releases from the Minister of Housing and the Minister for Māori Development the Hon Willie Jackson and the Minister of Finance the Hon Grant Robertson. On 17 December last year they put out a press release and they held a press conference on the black-and-white tiles here at Parliament about an agreement that had been reached on the future of Ihumātao. They talked about the purchase of the land. As you can imagine one of the things that people were interested in was: Well $30 million that doesn't come from nowhere. Where are you going to get the money?"And of course one of the principles of a parliamentary democracy is that Ministers aren't laws unto themselves who can just write cheques from the taxpayer purse whenever they want. They can't just dip into the taxpayer reserves and pay for whatever they wish to at any time. We have a formal Budget process. That Budget process requires the Government to set out line by line in detail what it is seeking funding for and how funding will be spent. We were all aware that there was no line item in last year's Budget that put aside $30 million for purchase of land at Ihumātao.The question was asked: how is this going to be funded? I will quote from the Minister's own words in the press release. Housing Minister Megan Woods said "the land is being purchased from Fletchers … under the Land for Housing Programme as the parties have committed that there will be housing on the site." Now if that were the case then Ihumātao wouldn't be in this Supplementary Estimates bill because that appropriation already existed. It was part of the KiwiBuild appropriation. It had been set out clearly in the 2020 Budget. But members on this side of the House were fairly concerned when we heard that it was going to be funded from Land for Housing because it simply didn't stack up because the Land for Housing Programme was set up as an appropriation with the purpose of getting more houses built at a quicker pace than would otherwise be achieved.Now in the case of Ihumātao what we know is that Fletcher Building had been planning 480 homes on the site. So our question was: well how can this purchase by the Government be accelerating houses being built when they're not even prepared to commit to a single house being built by a single date? And they still haven't by the way detailed how many houses will be built or when they'll be built by. So it was clear to us that it was a very big stretch to say that this money was being spent in a way that would get more houses built quickly. So that then raises a question: if the Government is saying in its public communications that it is funding something out of a particular fund within appropriations and yet it doesn't seem to meet the purpose of those appropriations then what should it do?Well that is why we end up here today because the Government does have the ability to vote itself more money for projects that occur on an ad hoc basis but it has to go through a very formal rigid process to do that. That formal rigid process is that it has to seek imprest supply. Technically departments need to make that request and then those extra appropriations need to be put in the Supplementary Estimates bill. And it was not until I wrote to the Auditor-General to say "Hey what's going on here? Why is the Government claiming it's using the Land for Housing fund for this purchase when it doesn't fit with the purpose of that fund?" that the Auditor-General went and had a good look at it and said "Well actually yes you're right; they're not going to be able to use the Land for Housing fund because technically it doesn't meet the requirement." So they've set themselves up a new appropriation.Now the Minister of Housing has tried a game I believe of wool pulling over eyes by saying "Oh look this sort of technical thing happens all the time." Well she is correct in so far as that from time to time officials forget to put things in the Supplementary Estimates process or imprest supply process. But she is wrong to suggest that Ministers forget to be up front with the public and say "You know what? We can't fund it from Land for Housing because it doesn't meet the purpose. We have forked out an extra $30 million for it." That is what happened. I put it to you Madam Speaker that Ministers hoped it would be buried in this bill and nobody would notice. Well we noticed and the Auditor-General noticed.Now I want to highlight for you the fact that actually Ministers knew before they put that press release out in December that this was all going to be necessary this process today. Now the reason they knew was because Treasury had raised a red flag. Treasury had said to Ministers in advice earlier in December "Look you can't use the Land for Housing Programme in this way. We do not recommend doing this." Actually it is because the proposal is at odds with the Land for Housing Programme's intent operating model and scopes of appropriations. There is a risk that audit considers the expense does not fit with the appropriation scope and it is unappropriated spend.Ministers had been warned. They got that advice from Treasury prior to doing their press release saying that they would use the Land for Housing fund. So I do not accept that this was some technical error. Ministers had been explicitly told that they couldn't use that fund and yet in their press release they said that's how it was being funded. I believe that that is disingenuous in the extreme.Then we have the next piece of advice which is that actually if you want to do this technically correctly you need to set up a new appropriation. Now Ministers went ahead and according to the evidence we have from the Auditor-General they did that in February. They set up a brand new appropriation that now finds itself in this Supplementary Estimates bill. They agreed to establish $29.9 million of delegated authority to sign the sale and purchase agreement. Now that happened on 9 February Madam Speaker and you may be asking as anyone would "Oh well when they made that decision did they announce that to New Zealanders? Did they say 'Look actually we've realised this isn't actually a Land for Housing initiative. We've appropriated an additional $30 million.'?" Well I believe that would have been a transparent upfront thing to do. It should have been what happened but that is not what happened. The first we knew of the fact that there was this new appropriation was when the Auditor-General wrote back to us to spell out what had actually happened.So I think that yes in this bill there's the technical issue that officials omitted to request the correct approvals to get the authorities from Parliament didn't do the requests for the new appropriation to be included in the appropriation bill. There's all of that. But it would be wrong to blame officials here for technical errors when what is really at stake is the fact that Ministers knowingly put them into that state of confusion by obfuscating about the way the Ihumātao land purchase would be funded. And I'll tell you why they were a bit vague on this: because they did not want to front up to New Zealanders and say "We're going to use $30 million of your money to buy a piece of land and not a single house will be built." I will challenge the Government: if houses are going to be built with the supplementary appropriation in the bill today then tell us when tell us how many and tell us tomorrow."