Nash Stuart: Taxation (KiwiSaver HomeStart and Remedial Matters) Bill — Second ReadingText is incorporated into the Bound VolumeNash Stuart: Taxation (KiwiSaver HomeStart and Remedial Matters) Bill — Second Reading[Sitting date: 24 March 2015. Volume:704;Page:2533. Text is incorporated into the Bound Volume.]STUART NASH (Labour—Napier): I am standing in support of the Taxation (KiwiSaver HomeStart and Remedial Matters) Bill. One of the reasons we are supporting this bill is that the officials said that this would have no impact. So it is not negative but it is just not going to do anything. I suppose one of the things that has been interesting in this debate for me is not so much what is in this bill but the attitude of Government members to housing and to this bill in particular. But I just want to start off by saying that this bill is shoddy legislation. It is all about style over substance. There are not 90000 Kiwis who are going to benefit from this. The officials said there were going to be a couple of hundred. But this is one of those bills that are out there and it is trumpeted that 90000 Kiwis will benefit. That is not the reality.Let me give you a couple of examples. Nick Smith stood up in the first reading and said that what this will allow Kiwis to do if they are coming home is they can get the HomeStart package they can get their KiwiSaver stuff and they can get access to about $50000. That example was actually a little disingenuous because if you have been away for 6 or 7 years the odds of you putting money into KiwiSaver are remote but let us say that Nick Smith is right.Let us say that you have come home to buy your first house and you have got $50000 in your back pocket because of this piece of legislation and because of the Welcome Home Loan and this sort of carry on. Mr Smith said that it will allow Kiwis to get into houses in Auckland. He said that it will allow Kiwis to be able to afford a $500000 house. Well to be able to afford a $500000 house you have to have a deposit of $50000 so you have got to pay off $450000 worth of debt. To do that at today’s rates it is $743 a week that you are going to be paying off—$743 a week—and the banks like to have a ratio of around about 30 percent of your disposal income going towards paying off your mortgage. They allow for a little bit higher but that is the ratio they are really comfortable with. Well to do that you have got to have a household income of $173000 to be able to afford a mortgage of $450000.Nick Smith has the audacity to say: “This is going to be great for Kiwis who are just coming home. They can buy this house.”—and they have got a household income of $173000? I do not think that is particularly realistic at all. In fact they are more than likely on the average wage to be able to afford something that has around about a $175000 mortgage if they are on the average wage of about $60000. So the arguments over there just show how much this Government is out of touch.I do not want to throw numbers around because people get confused but there are a couple of points that Jami-Lee Ross made that are just astounding. Jami-Lee Ross an Auckland MP actually said: “I am sick to death of hearing about the housing market. I am sick to death of hearing about our high-priced housing market.” Well I would suggest that a whole lot of people who live in the city he purports to represent let alone all over the country are sick to death of not being able to even come close to affording a house.For a whole lot of Kiwis now—a generation of Kiwis—the dream of homeownership has gone. Homeownership is not available. So Jami-Lee Ross what I say to you is instead of saying to people who come to you: “I don’t want to hear about the housing market.” how about having a little bit of sympathy? How about having a little bit of sympathy and saying: “I hear where you’re coming from. How about we sit down and work out a solution.”?The thing for me is that Jami-Lee Ross said—and this is a man who in his maiden speech said that Maggie Thatcher was his political idol—that the market has a solution and that highlights the absolute philosophical difference between Labour and National. National believes that the market has the solution; Labour believes that the markets are imperfect a lot of the time and that in a country the size of New Zealand the Government has a role to protect the interests and the identities and the well-being of good hard-working Kiwis. That is the difference.I would argue that in Auckland the market has failed and the reason I say that is that house prices have gone up at such a rate that homeownership is now unaffordable for a lot of Kiwis. In fact Mr Bennett inadvertently played right into our hands because he said that under Labour house prices had gone up by 96 percent in 9 years but that under National it had gone up by 28 percent. Well you know the reason why that is. It is that under Labour for 9 years the provinces boomed and so what you had was house inflation over the whole country because people had jobs in the provinces there were opportunities in the provinces and people bought houses and they moved there. Well I know—and you probably knowyourself Mr Deputy Speaker—that in the provinces—Mr DEPUTY SPEAKER: Do not bring the Speaker into the debate.STUART NASH: —there has not been house inflation; there has been house deflation.This is a Government that has actually forgotten the provinces and Alastair Scott got it dead right. He said that in order to have people go to the provinces you have got to create jobs and opportunities and that is exactly what Labour believes—exactly what Labour believes. But what has happened is that even the president of Local Government New Zealand who was a National supporter—he is no longer a National member—said before the last election that this Government did not have a plan for the regions and that is a damning indictment. But it makes me smile when I hear these guys say: “It’s the market—it’s the market.” The market has failed.In Australia they introduced something like this. What they did for first-home buyers was to give them $20000. It sounds fantastic does it not? The immediate thing that happened was that house prices increased by $20000. The market prices this sort of stuff in and that is what the officials said. In fact when we asked the officials: “Have you done any modelling on this?” they looked a little sheepish and they said: “No we haven’t.” We said: “Well what do you mean you haven’t done any modelling?”—Mr Scott will back me up on this—and they said: “Well we haven’t done any modelling.” And Mr Cosgrove said: “Well have you talked to the different agencies? Do you know the benefit?” and they said: “Well tentatively positive.” “Tentatively positive” will I think be the quote that goes down in Finance and Expenditure Committee—Kris Faafoi: Absolutely tentatively positive.STUART NASH: Absolutely tentatively positive. For me if we are going to do something like this then it has to be a little bit more than “tentatively positive”; it has got to be absolutely stunning because this is about substance and this is what Kiwis want to see. They want to see solutions. They want to see solutions not window dressing and I think that this measure is absolutely window dressing.There were a couple of things that Mr Scott said. He talked about whether a capital gains tax would come in. You know there are arguments for and against a capital gains tax but he said that if a capital gains tax came in it would force people to buy bigger houses. It is called the mansion effect and it has been completely discounted—I just wanted to put that on the table.We do want to see a register of foreign buyers. I just thought I had better address that. I just think that all Kiwis deserve the right to know who is investing in their country and I back that 110 percent and I would love to see this happen. That is not saying that we do not allow foreign investment in at all because Labour believes that foreign investment is absolutely vital to growing a strong economy but what we do want to know is who is investing and where they are investing—that is all. It is about to go ahead in Australia and in a lot of other countries.But there is something else I would like to mention that has not been talked about—[Bell rung]; just for the last 2 minutes—and this is the veteran income replacement payments. This bill is not just about getting your money out of KiwiSaver and buying a house. There is some stuff here about veterans. There was a member of the Defence Force who was in the select committee the whole time. We tended to concentrate on the KiwiSaver stuff but this was just as important as well.What I would urge RSAs and veterans’ representatives to do is to understand the bill and to go out and consult. I did ask a question of one of the Defence Force staff when I read this part and I said: “Hmm hold on a second here. This isn’t as clear as it seems.” and what this particular woman did say was: “Oh well what we have in RSA is veterans’ advisers who are very good at consulting and letting veterans know about changes in legislation.” But this is not quite clear-cut because what this is about is that there are changes being made to payments under the Veterans’ Support Act and they have now got to be treated in the same way as ACC earnings - related compensation. What that means is that this has implications for veterans who have student loans and child support payments. It is going to increase those obligations but it is also going to decrease the Working for Families entitlements for veterans.So what I would urge every representative from every RSA around the country to do is to understand the legislation and put it down in plain English in all your newsletters that go out to veterans and I would urge veterans to sit down and understand the implications of this. It is not quite as clear as I initially thought when the bill was going through the select committee. It was not until we actually sat down that I said: “Oh I now see.” So I urge all veterans and veterans’ affairs people to understand the bill and communicate that well to their constituents. Thank you very much.