Moroney Sue: Social Housing Reform (Transaction Mandate) Bill — In CommitteeText is incorporated into the Bound VolumeMoroney Sue: Social Housing Reform (Transaction Mandate) Bill — In Committee[Sitting date: 17 February 2016. Volume:711;Page:9109. Text is incorporated into the Bound Volume.]SUE MORONEY (Labour): I appreciate the opportunity to make a contribution to this debate although this is the first time I have spoken in the House this year and I would wish to have been speaking on something a lot more positive than this. I want to say happy New Year to everyone to start off with but now I am sorry it is going to have to be completely negative because what this part of this bill does is atrocious.I want to take a few minutes just to explain what this means for the people of Hamilton because the timing of this could not be worse. At the moment what is happening in Hamilton is there is a flood of people coming out of Auckland because they can no longer afford housing in Auckland. The members opposite are nodding—they know that this is true. People are moving to try to get more affordable housing in Hamilton so guess what is happening? The housing crisis in Auckland is being transferred from Auckland. It is marching on down over the Bombay Hills and it is landing in my city. The house prices are going up substantially as a result of that. The rents are following and are going up substantially as a result of that. That means that as a local MP I am getting increasing numbers of people coming into my office who are falling out the bottom.What does that mean? Well it means they cannot afford the rent increases—they cannot afford the rent increases. They are coming into my office and saying “I need help. I need a State house.” because that is what we set up our State housing system for. And I am sorry to say as a local MP there that is not a lot that I can do for them because the Government is flogging off the State housing stock. That is what Part 2 of this bill enables it to do—to flog it off.In Hamilton we are seeing the exact results of this because as a forerunner to it the Hamilton City Council is about to flog off pensioner housing flats. Exactly the same thing that has happened in that debacle I am predicting will happen because of Part 2 of this bill. It enables the Minister under new section 50E in clause 8 to agree to a transfer contract. It sounds all very easy does it not? But this is transferring the ownership away from the Crown to a private entity. Let us be clear about it—that is what it is in fact doing. This is privatisation of State assets. So the Government is transferring this ownership contract and it can do that “on any terms and conditions … that the Minister may agree with the transferee.”Well in the Hamilton City Council situation the council has done that. It has sold off a ratepayer-owned asset—pensioner housing flats—at 25 percent below Government valuation. I can tell you nothing in Hamilton is selling for Government valuation let alone 25 percent below. So the ratepayer is being ripped off but here is the thing that really breaks my heart: the immediate effect on the people who are the tenants of those pensioner housing flats is that their rent has gone up by 18 percent—their rent has gone up by 18 percent. Here is the reason for it: the new owners want to get rid of those pensioners from those housing units as soon as they can so that they can put new tenants in. They want to do that because when they get the new tenants in those new tenants under this bill that we are debating today will attract an income-related rent subsidy from the Government.So that is exactly what is going to happen under Part 2. This land and the housing associated with it is going to be flogged off at below the value that the taxpayer should be getting in return for it and the existing tenants are going to have pressure put on them to move out because under this legislation—and Minister Smith I am going to ask you if I am correct in this because my understanding is that this is where the Government has landed—those existing tenants will not attract the income-related rent subsidy. Is that correct? The Minister in the chair is shaking his head. They will not or it is not correct?Hon Dr Nick Smith: I’m not allowed to answer.SUE MORONEY: Oh OK. Well I would like the Minister to answer that question because that is critical to what is going to happen next. If the tenants do not attract the income-related rent subsidy then those new owners will want those tenants out as quickly as they can possibly march them out the door and the way they will do that is they will just increase their rent and they will increase the rent and they will increase the rent until they leave.