Sage EugenieHon EUGENIE SAGE (Minister for Land Information): E Te Māngai o Te Whare tēnā koe. I am very pleased to be able to speak in support of the Overseas Investment Amendment Bill on behalf of the Green Party. As Minister for Land Information I've been involved in the preparation of the bill and was very pleased to announce some of its details with Minister Twyford last week.I think the Opposition should realise that it is going to select committee and that submissions to the select committee will be listened to they will be read carefully. But the problem that the Opposition has created for this Government is in its failure to deal with this issue of overseas speculation in houses in New Zealand—in its failure to recognise that there should have been action taken to protect New Zealanders' rights to buy houses here from prices being inflated by overseas speculators. The Opposition said during the election campaign that it couldn't act to close the loopholes here—that there was nothing it could do. This Government has decided to do something about it and the reason for speed is of course the Trans-Pacific Partnership agreement and the agreements around that. There is a narrow window. We need to be able to have this legislation introduced and considered by the Parliament before that agreement is ratified. So it is all of the Opposition's making—the need for speed with this legislation. But it is going to select committee and can I assure Mr Joyce that the submissions and comments that are made at select committee will be carefully considered.Again Mr Joyce it's not Mr Parker that will be deciding on the day-to-day operation of this bill—another mistake. It's actually the Overseas Investment Office (OIO) as part of Land Information New Zealand. This bill delivers on the commitment that Labour New Zealand First and the Greens made to bring house prices back within reach of New Zealanders. We want to make it easier for New Zealanders to afford a home but offshore property speculators have been a factor in pushing up Kiwi house prices and pushing Kiwi homebuyers out of the market.Hon Dr Nick Smith: There is no evidence of that. That is not true.Hon EUGENIE SAGE: Dr Smith is disagreeing with that. But in an unstable world capital flows to areas where it's seen as safe and secure for investment and New Zealand is seen as a safe and secure country for investment. Now that is a good thing. As Minister Parker said we welcome overseas investment that brings benefits to New Zealand that adds to our economy that helps create jobs and that gives us access to technology that we wouldn't otherwise have access to. But capital also flows to where people get returns and speculators have been investing capital here and that's not good for our economy or for the well-being of New Zealanders. It drives up house prices more than in Australia; it forces Kiwis out of the market; and increasingly the dream of homeownership for young New Zealanders has been just that—a dream.National said Nah can't do anything about it. We'd breach the trade agreements. We can't act." so they didn't try. This Government is giving every effort to making a very good try to protect houses for New Zealanders and to reduce that pressure that occurs with overseas speculation and we're also taking action to strengthen the whole regime around overseas investment so that the OIO is no longer a rubber stamp. We took the first step in that direction with the changes to the ministerial directive to the Overseas Investment Office in November which ensured that any sales of rural land above 5 hectares needed permission. Previously it was rubber-stamped. That's changed.This bill is the second step in the Government's proposals and efforts to make sure that we tighten the regime around overseas investment. It's a strong effective and united response—unlike the Opposition's—because it's based on our shared priorities as a Government for this country. It's not about restricting or discouraging those who want to make their home in New Zealand and want to make a real contribution to this country. It's about stopping overseas speculation so that when house prices lift again there's not additional pressure put by these investors coming into the market.So what this bill means is that New Zealand citizens and permanent residents can buy and own their own home without going through the screening process through the Overseas Investment Office and so can those permanent residents who've been living in New Zealand for 183 days of the last 12 months. But other overseas investors and other classes of residence visa holders will actually have to go through a screening process with the OIO and that will be if they can show that they've got a commitment to live in New Zealand if they're actually increasing the housing supply by building houses and then selling them or if they're going to use land and convert it to a use such as a retirement village student accommodation or other long-term accommodation. Now Mr Brownlee talked about the standing consents. That is a sensible provision in the bill to ensure that those overseas investors who are investing in things like this long-term accommodation or doing a number of subdivision and housing developments can actually get on and do that. They don't have to go through the process each time but they will have to show that they are of good character and meet the other tests in the Act. Hon Gerry Brownlee: What's different?Hon EUGENIE SAGE: It's very different Mr Brownlee because at the moment if you're on a temporary visa—if you're a student visa holder—you can buy land. At the moment if you are a trust you can buy land. This bill closes that significant gap that overseas trusts—where there's more than a 25 percent control or influence by an overseas person—will actually have to go through this legislation. This closes a major loophole that the former Government left.Mr Brownlee this bill applies to land that's classified as residential or lifestyle. So we did the work around the rural land and now this bill's dealing with residential and lifestyle land and yes it does include apartment blocks. Yes it does include apartments in apartment blocks because otherwise that's creating a loophole.So people who aren't New Zealand citizens who aren't permanent residents will have to go through this screening process and the OIO is the most appropriate body to do that screening because they've got a recognised process for assessing the fitness of people to invest in New Zealand—the good-character test—and they've got the skilled staff to do the job. Yes it will cost more but we need to invest more in the Overseas Investment Office if it is to do its job properly. There had been a small increase in the office staff under the previous Government but there will be a bigger increase obviously to apply this legislation.So there are three pathways to actually being able to buy a home if you haven't got permanent residence—if you're not a permanent resident. Those classes are being actually able to show that you're going to live permanently in New Zealand and that you've got a genuine commitment to this country; that you're doing a new build or development work as long as those properties are sold; or that you're buying residential land for development as a non-residential use.So there's a provision in the bill—which I hope the select committee will look closely at—around the regulation-making powers for Ministers. That will enable regulations to define any other categories of residence visa where the holders of those visas can apply to the OIO to purchase residential land and the tests that would operate there. So we're certainly open to discussion as to how those tests will work. We'll look closely at the submissions that come in to select committee because we want to make sure that those tests are right and we don't want to discourage people who've got a genuine desire to live in New Zealand and contribute to this country.This country has suffered long enough from an overseas investment regime that is loose and that has had a rubber stamp approach—an open gate to speculation. We are tightening that regime.Hon Gerry Brownlee: No this is more loose.Hon EUGENIE SAGE: Yes we are—yes we are. The other measure in the legislation is increasing the compliance powers that the Overseas Investment Office will have—something the last Government did nothing about. That involves conveyancers needing to certify that to the best of their knowledge the purchase is not inconsistent with the proposed rules and it will mean civil penalties for third parties who are involved in contravening the Act. There will be the ability for the OIO to notify someone that the office has reasonable grounds to believe that they have acquired a property in breach of that Act and then for that person to sell the property and no further action being taken. There will also be a greater ability for the OIO to acquire information.The last Government failed to close the loopholes. The last Government wasn't interested in the OIO having any teeth. This bill helps give them teeth."