Twyford Phil; Tisch LindsayPHIL TWYFORD (Labour—Te Atatū): We are supporting the regulatory systems amendment bills through the House. It is one of the few bits of legislation from this National Government that we can support in all good conscience. This is an impressive collection of minor technical amendments many of which are going to fix drafting errors and fine-tune a number of small problems in the building and construction space as well as workplace relations and commerce. I am going to confine my comments to those that apply to the building and construction elements of this legislation.It probably goes without saying—but I will say it anyway—that we wish that there was a lot more legislation dealing with the many policy defects of the current Government's approach to building and housing. But we are here to discuss this legislation so let us do that. There are three things that I want to talk about: first the changes to the Building Act; secondly the changes to the Unit Titles Act; and thirdly the changes to the Construction Contracts Act.First the Building Act. That is probably of the three elements I am going to talk about the most minor. There are a number of—half a dozen I think—very small changes that are really just minor fixes to drafting errors and in particular some cross-referencing problems so we can dispense with that pretty quickly.The Unit Titles Act has more changes and more substantive changes but again it is worth noting in this debate that the Unit Titles Act is long overdue for reform. It is a part of the building and construction industry and the accommodation sector in New Zealand that is burgeoning and the current legislation is simply not fit for purpose. I look forward to seeing the results of the wider review of the Unit Titles Act that the Minister is working on.In particular there is a real need for much tougher requirements for bodies corporate around transparency and accountability. There is a need for requirements for funded maintenance plans to avoid owners of multi-unit dwellings getting into all sorts of problems when they get hit with the need for expensive maintenance plans that have not been properly planned for or properly funded. So there is a big need for an overhaul of the governance of bodies corporate. That is not in this legislation and that is fine but I hope we see it very seen.There are a number of things this legislation does to the Unit Titles Act which I will just mention briefly. It basically clarifies the existing law where an estate or an interest in land in a unit title development is acquired under the Public Works Act. It requires a new unit plan to be developed or an amendment to the plan and that to be deposited and if the body corporate requests it in writing for the authority to undertake the public work at its own expense and prepare a new unit plan or amendment to the unit plan.There is the issue about the assignment of interests. The legislation provides among other things for the initial process of assessing and assigning those ownership interests when a unit plan is deposited. Further there is an issue about the distribution of proceeds. The legislation provides that the proceeds received by a body corporate as the result of any sale or lease or licence over the common property must be distributed to the unit owners on a proportional basis. Finally in relation to the Unit Titles Act it tidies up a few things in relation to easements and covenants. So it extends the powers of the body corporate in relation to easements and covenants over the common property. We are perfectly happy to support all these things. They clarify they tidy up the law and they certainly make some minor improvements.Probably the thing that is the most pressing in this legislation from my perspective anyway is the changes that are made to the Construction Contracts Act. The legislation does a couple of things that I think are really important. The first is that the legislation provides the obligation for a construction company or a contractor to hold retentions—that is those moneys that a contractor or the client holds until the job is complete or until a period has passed until all possible defects have been sorted out are held in trust. We were very glad to see and we supported the passage of the Construction Contracts Bill through the House and in fact that very provision that retention moneys should be held in trust so that if a construction company goes bust the retention moneys that ultimately should be paid to the contractor or the subcontractor for work done are not lost—because we have seen far too many cases in this country of construction companies going bust and the contractors and the subcontractors down the chain have lost out big time. It is a defect in our construction industry that is long long overdue for reform.I want to once again acknowledge the work of my colleague the Hon Clayton Cosgrove who I think convinced the Local Government and Environment Committee and convinced the Minister the Hon Dr Nick Smith of the importance of that provision. So what the legislation does is it clarifies the Construction Contracts Act 2002 to make it clear that contracts entered into prior to 31 March the end of this month—that the trust provisions do not apply to contracts entered into prior to 31 March. Without that clarification that was causing a lot of uncertainty and stress for construction companies.The other kind of minor clarification is that it allows companies that are affected by these retentions provisions to use other financial instruments not just cash. There were a lot of submissions to the committee and advice that a conservative reading of the provision in the Construction Contracts Act would have allowed effectively only cash to be used. It would have actually required the companies affected probably to borrow money to put aside the retentions and hold them in cash. It would have added really significant costs to those companies and by this kind of more expansive definition it allows insurance products and bonds and other things to be used to be held in trust as retentions.So those are the main points I want to touch on. We are happy to support all of those and we appreciated the chance to have a full debate on all of these issues during the Committee stage. In finishing let me just reiterate our view that there is a lot of work to be done in this area in the building and construction industry. The ongoing work of creating a regulatory framework that allows significant improvements in productivity to occur to get a better balance of the liabilities within the industry—the Minister has been talking for some time about mandatory warranties for residential construction and still really we have not seen any progress on that after 8 years in Government. Maurice Williamson was talking about it when he was the Minister. So although this legislation makes some—Hon Member: Was he Minister?PHIL TWYFORD: Maurice Williamson used to be the Minister for Building and Construction. In the last 8 years he was probably the best Minister for Building and Construction we have had.So there are some minor fixes and the cleaning up of drafting errors. We are happy to support that but there is so much more to be done in the area of the building and construction regulatory framework not to mention a long list of things which I would love to go through that are needed to fix the housing crisis that has built up under this Government. Thank you.The ASSISTANT SPEAKER (Lindsay Tisch): Not in these bills.