Newman Muriel: Courts and Criminal Matters Bill — First Reading 
Text is incorporated into the Bound Volume 
Newman Muriel: Courts and Criminal Matters Bill — First Reading 
[Sitting date: 19 June 2003. Volume:609;Page:6457. Text is incorporated into the Bound Volume.] 
Dr MURIEL NEWMAN (ACT NZ) 
: 
 I rise on behalf of the ACT party to support this bill to the select committee but I do so with huge reservations. This bill purports to get tough on the collection of fines and civil debt but when we look at the fine print we see that much of it is simply words. It is interesting that if we look at page 12 of the bill it talks about the level of debt in New Zealand the unpaid or uncollected fines and it quotes the 2001 figures instead of the more recent figures which show us that as at 1 May 2003 there is $487 million worth of unpaid fines in New Zealand of which $314 million is overdue. The first thing I would like to say to the select committee that deals with this bill is that it would be interesting to find out from the officials why they used information that is 2 years old. The situation is much much worse than this bill is trying to pretend. 
The problem is that we have a Labour Government that is soft on crime. That is why the amount of uncollected debt has increased so dramatically since Labour has been the Government. It is in all different areas whether it is civil debt criminal debt or beneficiary debt. In all of those areas we find that this is a Government that does not go out and demand that the money is paid. The problem with this bill is that it is without teeth. 
 The other point about this bill is it fails to deal with probably the most important issue about uncollected debt that this country faces—that is all those hundreds of thousands of landlords out there who are owed millions and millions of dollars in unpaid rent yet this Government is doing nothing about it. This bill was the correct vehicle to address this issue. This Government is failing once again to get tough on lawbreaking New Zealanders. 
The issue is that when a landlord and a tenant go before the Tenancy Tribunal and the tribunal says that the former tenant must pay some back rent or some debt for damage done to the property and so on if the former tenant is a beneficiary he or she is protected by this Government. This Government is not only soft on crime but also soft on welfare. It is now time that it did something about it. 
As I said hundreds of millions of dollars are owed to mum-and-dad landlords around this country. In fact $1.6 million is owed to Housing New Zealand by former tenants who have refused to pay. I understand that the biggest debt owing by just one former tenant—owed to Housing New Zealand—is probably in the region of $18000. I want to know what this Government is doing to collect that $1.6 million debt—a debt owed to the New Zealand taxpayer. 
The real issue for mum-and-dad property owners who bought a rental housing unit for their retirement income is that defaulting tenants are an absolute nightmare. Those landlords take their case to the Tenancy Tribunal—a court of New Zealand. The former tenant is ordered to pay up but before the court bailiff can go and serve the order on the defaulting tenant the bailiff has to be supplied with the tenant’s address. If those tenants are in the workforce that is not so much of a problem because even if they have moved jobs they can usually be traced. But if the former tenant is a beneficiary then it becomes an absolute nightmare. Although Work and Income knows where the former tenant lives it refuses to give that information out to an officer of the court. In other words Work and Income fails to uphold the rule of law. 
There are some 170000 private property investors in New Zealand who invest around $43 billion into the rental property market. They own some 230000 rental housing units. Every year those private property investors take some 42000 applications to the Tenancy Tribunal. A small number of cases are taken by tenants against their landlords—the majority against Housing New Zealand—but over 40000 are taken by landlords against their tenants. These cases are against tenants who have skipped without paying rent or without paying for damage that has been done to the property. 
The problem is that this Government has had an opportunity to really deal with this issue; the Residential Tenancies Amendment Bill has now gone through the Social Services Committee and come back into the House. The committee heard hundreds and hundreds of submissions. This issue came up in almost every single case. All the landlords said that this was a major problem for people involved in rental housing. They said: “Government please please sort it out.” Instead of sorting it out this Government has said some nice words and done absolutely nothing. This bill before the House shows that Labour has no intention of dealing with this issue unless it is forced into it. 
The issue was taken to the ombudsman in 1999. Four landlords went to the ombudsman regarding six former beneficiary tenants and asked whether it was fair that the Government hides those people’s addresses and will not allow justice to prevail. The ombudsman spent 4 years investigating this issue. All the landlords wanted was that the new address of the tenant should be given to an officer of the court so that the order for paying the money could be served. That is all they wanted. They did not want the information. They wanted the officer of the court to get the information. 
I understand that that is one of the most difficult investigations the ombudsman has had to do because every time he tried to consult the Ministry of Social Development on this issue it apparently stonewalled him. Eventually last September the Chief Ombudsman ruled in favour of the landlords. He ruled that the Ministry of Social Development must give the addresses of beneficiary former tenants to the collections unit of the Department for Courts for the purpose of enforcing a judgment order. He figured that the public interest favouring disclosure outweighed the private interest of the individual debtor. 
Mum-and-dad landlords throughout the country welcomed the ruling. They said that at least somebody was seeing some common sense. But on 10 October proceedings were filed in the High Court against the Chief Ombudsman by the Ministry of Social Development. It tried to stall this ruling being made into law. CIV-2002-485-837  
Her Majesty’s Attorney-General  
v  
Chief Ombudsman 
 was filed in the High Court. The ombudsman then went on to prepare his case. The New Zealand Property Investors Federation had to prepare its case. The Crown had to prepare its case. Just before the hearing in the High Court on 8 May this year the Crown withdrew. 
 So far the cost to the taxpayer has been enormous. The Chief Ombudsman has now asked for $100000 to be funded to his office to pay for him preparing his case. The Property Investors Federation will have $30000 to $40000 worth of costs as well and the Government has given me information that shows that it has already spent $100000 of taxpayers’ money but it is simply the tip of the iceberg. This Government tried to stop the ombudsman’s ruling going through. The ombudsman’s ruling would have allowed landlords to find justice and I expect the select committee to deal with this issue.