Residential Tenancies Amendment Bill — In CommitteeText is incorporated into the Bound VolumeResidential Tenancies Amendment Bill — In Committee[Sitting date: 24 May 2016. Volume:714;Page:11113. Text is incorporated into the Bound Volume.]Residential Tenancies Amendment BillIn CommitteeTIM MACINDOE (Senior Whip—National): I seek leave for the parts of the Residential Tenancies Amendment Bill to be considered as one debate with the questions to be voted upon separately at its conclusion.The CHAIRPERSON (Hon Trevor Mallard): Is there any objection to that course of action? And I am assuming that the member means the preliminary clauses as well.Tim Macindoe: All parts and the clauses.The CHAIRPERSON (Hon Trevor Mallard): So just making it clear the member has sought leave for the parts and preliminary clauses to be debated as one question but for votes to be taken separately. Is there any objection to that? There appears to be none.Parts 1 and 2 schedule and clauses 1 to 3PHIL TWYFORD (Labour—Te Atatū): Recognising that we are going to treat the Residential Tenancies Amendment Bill as one part for this debate including the preliminary clauses I want to make some opening comments about this debate. We have made it clear all the way through that Labour is supporting this bill because we think that it long overdue that the standards of New Zealand’s rental housing are brought into the 21st century. We believe that it is long past time for mandatory standards to be set for rental properties public and private and that there is a strong public support for the idea of making sure that rental properties—whether they are Housing New Zealand the council or community organisations as well as those in the private rental market—are warm and dry. The reason is this: the latest estimates from Otago University are that 50000 children are hospitalised every year in New Zealand and many of them are hospitalised with preventable infectious and respiratory diseases that are associated with poverty overcrowding and cold damp mouldy homes.We have had many debates in this House about this issue in recent years and I have to say I am pleased to finally see the National Government acknowledging there is a problem that needs to be solved here and this bill makes some attempt to set some standards. But we on this side of the Chamber are bitterly disappointed that the bill does not go far enough. We agree with the comments that were made by Dr Russell Wills the Children’s Commissioner who came to Parliament and said that Nick Smith’s Residential Tenancies Amendment Bill is a broken promise to the nation’s children and that it is a wasted opportunity to do the job properly. One of the things we are going to be talking about in this debate is what is not in this bill but should be and we will be doing our best to link that to the specific provisions in the bill.The CHAIRPERSON (Hon Trevor Mallard): The member had better start fairly soon.PHIL TWYFORD: What the bill does is set standards for insulation and that is good in itself but the problem is that without setting standards for heating and for ventilation all we are doing with this bill is insulating many houses that are cold and damp and miserable. That is why we believe there should have been ventilation standards in here and there should have been heating standards. That is quite doable and much of the work has been done particularly by the metro councils.Five different local authorities have done a comprehensive trial of the warrant of fitness concept. There are lots of data that could be drawn on including the Minister for Building and Housing’s own trial of Housing New Zealand properties but sadly for a spurious reason—the Minister thinks it will be an unwarranted and onerous burden on landlords that may cause rents to go up and we will deal with that argument in the course of this debate—this bill focuses far too narrowly on insulation standards and there are many provisions in Part 1 of the bill that deal with the machinery that will implement those insulation standards.There are other issues that we will deal with in the course of this debate. One of them is the grace period that this bill gives to landlords. There is a 3-year grace period. We believe that is far too long. A year’s grace period would be better as is reflected in Andrew Little’s Healthy Homes Guarantee Bill (No 2). We could then allow the changes to be implemented as tenancy agreements turn over. I think the average length of a tenancy is around 10 months. If you phased in the changes that are required when tenancies turn over in a very short period of time the great majority of rental properties would meet the required standards.The other issue we want to talk about in more detail is in the schedules and it relates to the regulation-setting powers that this bill puts in place. It is quite sensible for things like insulation standards—and heating and ventilation standards if there were heating and ventilation standards—to be set by regulation. [Bell rung]The CHAIRPERSON (Hon Trevor Mallard): Just before I call the member I do want to remind members that the Committee stage of a bill is not the point when members can speak about what is not in the bill. They have got to speak about the bill the technical clauses in it and the amendments to it. By way of advice I would refer members to Metiria Turei’s Supplementary Order Paper to the bill and in particular the amendment to add subclause (2B) to clause 13 which probably will help members.PHIL TWYFORD: The only remaining comment I wanted to make in the opening contribution is really about the regulation-setting powers and to say that it is perfectly logical and reasonable for these kinds of standards to be set by regulation because standards will change as new technologies new design and new products are available and as social expectations develop.The unfortunate thing in relation to this bill is that the draft regulations that have been released at the same time as this bill demonstrate an intention by the Government to allow a giant loophole in the insulation standards that this bill propagates. Unfortunately it is going to allow hundreds of thousands of properties that are already insulated to the redundant 1978 standard which is insulation that is not very thick and the draft regulations which have been released alongside this bill will mean those properties will not have to be upgraded to the current 2008 building standard which would allow insulation that is much thicker. This bill is effectively legislating into place redundant and inadequate standards for legislation. Thank you.METIRIA TUREI (Co-Leader—Green): I want to address my Supplementary Order Paper 172. It is quite comprehensive and I will need to take a number of calls to describe its parts and why we think they are necessary.What we have in New Zealand now in the rental arena is that we have moved from what used to be about 80 percent of New Zealand homes being owned and occupied by the owner and about 20 percent being rentals. That proportion has significantly changed over the last 20 or 30 years to much more of a 60:40 kind of proportion. This has put renters at a severe disadvantage because the law has been designed around a very narrow set of residential tenancies mostly in relation to State housing actually from way back.So there has not been a significant upgrade in the rights of long-term renters in our law and we see the effects of that through the failure of our systems including enforcement by the Tenancy Tribunal to make sure that rental homes are up to standard and are actually warm and safe and dry for families to live in. This is why in part we have such a major problem with poor-quality housing because our law does not allow for tenants to be able to require landlords to take action. And although we do have the Tenancy Tribunal for example which is established for that purpose as the proportion of tenants increases and the supply of rental housing decreases—we know we do not have enough for everybody who needs it—then tenants become increasingly vulnerable to landlords who are in it for a quick buck who are not committed to making sure they are professional landlords and are doing a good job and maintaining their homes to a high standard. When it comes to looking at anything like a warrant of fitness approach to New Zealand’s rental housing it is also important to improve the rights of the renting families who are in those homes so that they can genuinely hold their landlords—and often their property managers—to account for the minimum standards that are set in the law.The first of the amendments on my Supplementary Order Paper 172 is to clause 6. Clause 6 is about changes to the tenancy agreements. There are a number of changes that the Government wants to make and I have a number of additions to them. These additions are about improving—they are a start; they are not the full story—the rights of tenants so they have some ability to hold their landlords to account both for standards but also to protect their tenancy so that they are not kicked out if they complain about poor-quality housing or a landlord’s failure to meet the standards.The first of those additions is that a tenancy agreement must include a statement saying that when the tenancy terminates the tenant has the right of renewal. This is particularly important for families. There are many many thousands and thousands of New Zealand families now who will never own a home. They are permanently locked out of the homeownership pathway. They will always be renting—raising their children from little babies; through to when they eventually retire—they will always be renting. In those circumstances it is critical that families are able to secure themselves a long-term tenancy. In New Zealand the tenancy agreements are generally for about 12 months so we do not have the kinds of long-term tenancies that you see in other places where renting has been part of the culture for longer particularly in places in Europe. This provision to enable a tenant to have the first right of renewal means that that tenant can stay in their house. If the landlord is wanting to get rid of them because they want to put up the rent or they want to do something else with the house well actually that house is now the home of the tenant. If it is better for the tenant and their family that they stay in that home—their kids are going to the local school they have got access to local work and they have built themselves a life in that community—then they should have the right to stay. That is the first change.The second change is that the tenancy agreement must include the calculation that the landlord intends to use to increase the rent. One of the major problems that we hear from renters is that their rents are going up every 6 months and they have absolutely no idea what is going to happen. We heard a terrible story Marama Davidson and I in Christchurch just last week about a woman who was renting a home. It had earthquake damage. The Earthquake Commission was finally going in to do the repairs. She had to move out. The landlord told her that if she wanted to move back in she would have to pay another $250 a week in rent so she is now effectively homeless as a result of the earthquake. This is because there are no protections for tenants as a result of the earthquake. So this woman and her family are now having to find themselves a new home. This change would at least prevent the landlord from being able to say: “Well we’re going to massively increase your rent for you to be able to stay.” The rent calculation would have to be set into the tenancy agreement so that tenants know how much extra rent they can expect to be paying and when it is.We would also under this Supplementary Order Paper restrict the number of times that a landlord could put up the rent—no more often than once every 12 months. That still seems to me a bit harsh on tenants but landlords would not be able to put up the rent more than once every 12 months. This gives the tenants certainty—how much the rent is going to go up by and when it is going to go up and they can plan for that. It means they can plan their finances. They know the rent increase is coming. It is not going to come as a surprise. It is not going to come rapidly time after time. They have got some control over it.We would also change the tenancy so that is for a fixed term of 3 years as a default. That again is to help provide tenants with greater security. We are advocating these changes because one of the concerns that often gets raised is that if you have a warrant of fitness even one as minor and as miserable as is in this bill the tenants’ rents will go up. They need more protection and there is not sufficient protection. The policy settings to provide sufficient protection are pretty tricky; it is not easy to find a solution to this. We need to get on the policy road of better protecting tenants’ rights so that they can deal with these kinds of changes and make sure that tenants are secure in their homes.One other thing we would do is get rid of the 42-day notice. There are stories after stories after stories of landlords who issue a 42-day notice to tenants saying that their kid wants to live there or their auntie wants to live there. No such thing is really happening. The tenants have no comeback. They get 42 days’ notice to leave their home. These are people’s homes. If you are a landlord you own a house. If you live there it is your home.We need to make sure that people are warm and safe and dry and secure in the homes they are raising their families in. There is a very significant list of what a comprehensive warrant of fitness would look like. This is a list that has come directly from the research that was prepared by the recipient of the Prime Minister’s Science Prize. I have a great deal of confidence—and clearly the Prime Minister has a great deal of confidence—in the research the skill and the veracity of this warrant of fitness list given that it came from Philippa Howden-Chapman who was the recipient of the Prime Minister’s Science Prize. I think this would be a great way if we agree to the list in this bill to recognise not only her skills as a scientist but actually the work that she does.There are some basic things in here because they are not provided for in the law such as adequate cooking facilities. Those of us who live in our own home or have had the benefit of living in a high-quality rental property might not think that is important. But last night I was told a story by a group of students who said that their land agent refused to replace their stove. All they had to cook on was a gas element and a skillet—for 12 months. The land agent said the stove was a non-essential item and refused to replace it. You can say that they should go to the Tenancy Tribunal but then they risk losing their home because they have no security of tenure. So you cannot expect people in very vulnerable situations to hold landlords to account for this if they have to argue their case before a tribunal. We have to make it mandatory that the basics are provided: adequate food preparation and storage areas potable water—there is no requirement in the law for drinking water to be in the home. Hot water—there is no requirement in the law for that. A functional toilet a bath or a shower—there is no existing requirement in law for those.Fixed space heating is also in this list and it is essential. It has to be adequate for the house. One of the critical issues we have found from the Emma-Lita Bourne tragedy was that this was a home that had a fixed space heater in it but it was in the lounge in a two-storey cold concrete block terraced house. The heating got nowhere except—JONO NAYLOR (National): I just rise to take a brief call at this Committee stage of the Residential Tenancies Amendment Bill. I just want to I guess from my perspective re-emphasise what a balanced sensible approach this bill is taking. We have heard some contributions already at this stage implying that perhaps the lead-in times for some of the provisions here are too long but I just want to remind the Committee that in some of these aspects that are being brought in—for smoke alarms for example which we know will save lives of people in New Zealand; we know statistically about people who have died in house fires where there have not been smoke alarms installed in rental premises—immediate action is being taken.At the moment what are we talking? We are in May now. By the time this bill goes through 1 July this year it is going to be mandatory for rental households to have smoke alarms. That is I think appropriate timing because we know that there are immediate effects and immediate benefits that can be had. Of course it is realistic for a landlord to be able to have those checks in place to ensure that those smoke alarms are going to be in place by 1 July. It is a relatively low-cost thing that can be done and easily organised and so of course we should ensure that that is put in place immediately.Mr Twyford in his contribution thought that the lead-in time for the insulation aspects of this bill was too long. It is a little bit more complex when you are looking at insulation requirements than it is for smoke alarms. When it comes to smoke alarms as I have said they are low cost and easy to organise. But if a landlord is having to look at completely redoing the insulation on a property it is going to take some time to organise—to assess the current standards and to also assess whether or not it is actually going to be viable for that to occur. I am sure as we go through this process there are going to be some things that need to be sorted out from time to time between officials from the Ministry of Business Innovation and Employment and landlords as to what constitutes viability for the retrofitting of insulation because not all houses are designed the same. We are going to need a significant lead-in time to ensure that this occurs and also to ensure that landlords have put aside appropriate financial provision to enable them to do this.One of the other arguments that I have heard that has been a bit concerning is that we are simply settling for a substandard level of insulation by requiring people to come up only to the 1978 standards. There has been a bit of misinformation that has been out there and I just want to make this completely clear: if a house was built prior to 1978 it will need to be insulated up to the 2008 standard. So we are not simply settling for the 1978 standard. What we are saying is if it was built before 1978 absolutely it will need to come up to the 2008 standard.However if the house was built after 1978 and that insulation is still in good repair then it will not need to be upgraded. That is because the cost of upgrading what may be a minor amount is not proportional to the benefit that will be determined from that. For example if a house was built in 2007 and was not up to the 2008 standard but was close to it—not necessarily back at an absolute minimal standard but because technology had changed over 30 years a builder may have put something in that was more substantial than the 1978 standard—it would be absolutely impractical it would be an excessive expense for very little benefit to require that landlord to retrofit a 2007 house that has been insulated to a very good standard up to that 2008 standard. So as I said this is highly practical. It is highly feasible.If you think it is all one-way traffic for landlords in this bill it absolutely is not. There are going to be higher fines for landlords if they do breach any of these things. It is absolutely imperative that we have a big disincentive for landlords to breach any of these things that are being introduced through this bill and so we are going to be increasing those top fines that people can be paying to ensure that they do comply and do go forward.I just want to address a couple of things that the previous speaker Metiria Turei mentioned. The first is the idea of there sort of being a right of renewal necessary for tenants. Well I can tell you I have yet to meet a landlord who had good tenants in place and who if they wanted to continue would suddenly just terminate their tenancy at the end of their fixed term.LOUISA WALL (Labour—Manurewa): I am specifically going to talk about Supplementary Order Paper 172. I want to commend my colleague Metiria Turei for specifically focusing on a 3-year term. The reason I do so is that I have just read an extract in the National Business Review from Philippa Howden-Chapman’s book called Home Truths: Confronting New Zealand’s Housing Crisis and actually the average tenancy is 11 months. The impact of that on families and on communities is pretty intense.I specifically want to talk about a Child Poverty Action Group report called The revolving door: Student mobility in Auckland schools dated May 2014. The impact of transience on our children’s learning is immense and I am sure the Minister in the chair Nick Smith would be interested to know that within that report essentially it said: “ ‘Overall we found that student mobility often produces an array of negative psychological social and academic consequences for children…’ ”. But surprisingly in that particular report it was not just the children living in transience who were affected it was actually the entire school community. So what we know is that stable communities produce better outcomes for the social good. And the relevance to electorates like mine in South Auckland is that our Pacific and Māori rates of homeownership are actually incredibly low—for Pacific it is 18 percent; for Māori it is 28 percent.So this piece of legislation is incredibly important and this amendment that Metiria Turei is trying to have endorsed here in the Chamber today is incredibly important. Allowing children to live in a home for 3 years is actually going to produce much better outcomes and this is reflected in a Ministry of Education report from 2004. It came from an Education Review Office finding that basically said that carefully planned and sequential learning experiences were required for sustained learning that built upon previous learning. So the impact on our education system of having a housing system that does not provide stability to our most vulnerable communities and community members is incredibly important. The reason that I am standing up to support this particular part of Metiria Turei’s Supplementary Order Paper is that enabling our families who are the most vulnerable to have 3 years of living in the same home is actually going to have a huge impact on our children’s learning.But not only that—we think that children’s learning actually starts as 5-year-olds or 6-year-olds when we have compulsory education but what Shirley Maihi found at Finlayson Park School in my electorate was that it actually impacts on early childhood education learning. So the compounding effect of children not having sustained early childhood education when they are 3 4 and 5 then means that they enter the school system and they are already behind. The long-term implications for not enabling our families and our children to have some security in that tenancy are incredibly important. This then leads to the first part of Metiria Turei’s Supplementary Order Paper which is that when the tenancy terminates the tenant has the right to renew that tenancy hopefully for another 6 years. So in fact we build an ability for families to create homes to be part of communities to be part of their school communities and to have a secure base to be able to go to school from and for parents to be able to get extra education and to go to work. But I think we completely underestimate how vital a home is in the overall development of our children and society.I hope that people who are here today in the Chamber participating in the debate will take seriously the impact of insecure housing on the ability of our children to learn because I think that it is missing in this whole debate. We are not talking or thinking about the ongoing consequences. We know there are 26000 “neet” kids out there—kids who are not engaged in education employment or training—but they do not just manifest out of nowhere; they actually manifest because fundamentally at the beginning of their lives those children do not have stable base they do not have a home they do not go to early childhood education and they do not go to school. For people who think that this is irrelevant I have got within my electorate kids who have been to—Hon Dr NICK SMITH (Minister for Building and Housing): Firstly can I welcome the broad support for this bill across Parliamentat the Committee stage. I will briefly summarise the key provisions in these Committee parts and then just briefly speak to the Supplementary Order Paper in my name.This bill does five important things. Firstly it requires smoke alarms in all tenanted properties by 1 July this year—thus the priority for the bill. That is expected to save three lives per year. Actually 75 percent of the fatalities that occur in fires in New Zealand are in tenanted properties. They are higher risk and this bill provides the regulation-making power that we have in line to bring that provision. The Government is particularly keen to get that provision in place by 1 July as per the requirements in this Committee stage because we all know that those fire risks are greatest during the winter months.The second key requirement of this bill is a requirement for all homes to be insulated progressively over a period of 3 years. I do want to note that during the second reading there was some debate about the number of lives that it would save. I do want to correct something. At that time I said that the figure was 23 lives per year that would be saved as a consequence of the provisions. That was on the basis of a sample size of 30000 homes. Actually it is 180000 homes so my ministry has come back to me and said that the insulation provisions in this bill are actually expected to save 129 lives per year. They are very substantive they are important and I welcome the broad support for them.The third provision in this bill toughens up the capacity for the ministry to be able to actually enforce the existing standards. We have housing regulations. They cover issues of heating electrical ventilation and all of those things. The problem is not that the regulations are not there; the problem is a matter of enforcement. What this bill does is create the mechanics in the law to enable my ministry to actually go after that relatively small minority of slum landlords and ensure that those existing regulations are enforced.The fourth change in this part is around retaliatory notice. I am sure a number of MPs have noticed the issue that when a tenant does choose to go to the Tenancy Tribunal and seek to have an application of those housing regulations enforced there is a risk that the landlord will just give them notice. The provisions in this bill extend the period in which we can take a retaliatory notice application to the tribunal and the powers for that to be resolved.The last and the fifth useful part of this Residential Tenancies Amendment Bill is to provide for abandoned tenancies. Nobody wins from properties sitting vacant for months. As a consequence of the fast-track mechanisms in this bill it will improve that. The Supplementary Order Paper in my name No. 177 does make some amendments that I wish to make plain as to their intent and what they do.The first of those is in respect of the enforcement orders that are required in respect of the requirement to fix a property. It is making plain that those orders include those important new insulation and smoke alarm provisions. The second is an issue that has been debated and we want to make absolutely clear that anybody upgrading the insulation of their property before the deadline of 1 July 2019—just 3 years away and I remind Mr Little who is in the Chamber that that is a substantially faster programme of insulating houses than what is provided for in his own bill. What I am making plain with the Supplementary Order Paper is that any insulation work has to be done to the 2008 standard—that is if you are a landlord and your property is not insulated at the moment you cannot whip in and get some 1978 insulation and pretend that that meets the requirements of this bill. The Supplementary Order Paper makes that absolutely explicit: any insulation work has to be done to the 2008 standard.The last point that I would like to make is that the Government is not intending to support the Green Party amendments. They go too far. Let me give a practical example: it would be illegal to rent a home if it did not have visibility strips under the Green Party’s Supplementary Order Paper. Yes we think things like insulation and smoke alarms are right. But I do note that the Green Party’s own offices do not meet—do not meet—the visibility strip requirements that Metiria Turei is imposing on others. We on the Government benches say: “Don’t put rules on others that you’re not prepared to comply with yourself.” It is exactly the same I have to say when I check these standards against my own private home—it does not meet them. We need to focus on those things that are the basic legal requirements and that is what the bill does.ANDREW LITTLE (Leader of the Opposition): I would like to take a moment to address clauses 6 and 38 of the bill as well as Supplementary Order Papers 177 and 172. I just note that notwithstanding what the Minister in the chair has just said—the requirement that there be insulation and delegating it to regulation to determine what the standards will be—it is pretty clear that there will be ample rental housing that simply will not meet the 2008 standard that he glowingly talks of now. The reality is that his bill means there will be rental housing that simply will not come up to the 2008 insulation standard. But there is something that is even more disappointing and that is that it is just confined—this bill and the new standards that rental properties must meet whether income-related rental properties or not—the only additional standards they now have to meet are an insulation standard and a smoke alarm standard.It has been alarming to see in the justifications that the Minister gives that they include—he made this statement on 19 April 2016: “These new tenancy regulations will make 180000 homes warmer and drier by requiring insulation …”.I have news for the Minister: adding insulation does not make a house warmer. It will retain whatever warmth there is; it will retain whatever coolness there is. It will not add warmth. It will not make houses warmer and so this is a lost opportunity.When the Minister talks about houses that are safer because they have smoke alarms he might just want to reflect on houses that at the moment are making people—including young children—sick and are therefore unsafe. He might want to reflect on what a difference he could make if clause 6 which refers to the tenancy agreements and clause 38 which refers to the new powers for regulation making in fact added a requirement that not only should there be insulation as determined by the regulations but there should be a form of heating as determined by regulations.The regulation-making power allows ample flexibility for him as Minister or the department administering the legislation to ensure that it is not just one form of heating that counts.I know that part of his criticism of suggestions that other minimum standards should be added such as a source of heating is that it is all just about heat pumps—it is not.This is an opportunity for this Committee with his bill to get it right and we could expedite this House’s time on my Healthy Homes Guarantee Bill (No 2) by the Minister admitting that perhaps we can make some modest improvements now that would allow those standards to be added. The regulation-making power in clause 38 would allow ample flexibility and provide some reassurance to that part of the constituency that he is concerned about who might be thinking that they could be put to extra cost.I want to refer to Metiria Turei’s Supplementary Order Paper 172 because it does contain a list of additional standards that might be added. The Minister is critical for example of visibility strips. He is a former Minister forACC; he will know from the data from ACC that a common household accident is people walking into ranchslidersand floor-to-ceiling glass. In modern architecture and with a growing number of people living in apartments—and if only there were more of them to alleviate the housing crisis that “does not exist”—we will probably see more of this so actually visibility strips are not such a silly idea. It is after all an inexpensive idea.I will just prevail on the Minister while he is in the chair and while he has got the time and the attention of this Committee that with this piece of legislation at a time when the entire country is gripped by issues of housing housing standards and housing quality now is a time for leadership. He is capable of providing leadership—it has happened before I am sure of it. He could actually step up and say that insulation is important but a source of heat which is what the insulation is there to keep in the house is equally as important and those other standards that have been laid out in Supplementary Order Paper 172 are equally important for safety reasons for tenants living in rental properties. He could do it today.Hon Dr NICK SMITH (Minister for Building and Housing): I am delighted to have the opportunity to respond to the challenge from Mr Little. There is only one provision in his Healthy Homes Guarantee Bill (No 2) that is not in the existing regulations and that is the issue of regulating for a minimum temperature in a house. Members on our side of the Chamber say that it is not proper in this bill to regulate for a minimum temperature in a house. What Mr Little needs to go back and check is that housing regulations already require heating. It is already in the current regulations—not the regulations from this bill; it is in the current regulations. Heating ventilation absence of mould electrical safety plumbing integrity—all those things are in the existing regulations so the Leader of the Opposition does need to do his homework.The second point is this: the member has raised the issue of visibility strips and it is not the view of the Government that it should be illegal to rent a house that does not have visibility strips. If people want to have them and want to advocate for them that is fine but I have to confess that my house does not have them. My office does not have them. That does not mean I am an irresponsible parent or homeowner. It is not the sort of thing that should be regulated for and I am surprised that Mr Little is getting his party back into the nanny State routine of saying that visibility strips on all long glass windows must be provided or it will be illegal to rent a house.The third point I want to make in respect of Mr Little’s contribution is that he is mistaken around the issue of insulation standards. Let me take him through it very simply: in 1978 when we first provided compulsory regulations—Andrew Little: That one there?Hon Dr NICK SMITH: Yes for that insulation. Do you know that that 1978 standard reduces heat loss by 84 percent—84 percent? The 2001 standard took that up to 87 percent.Andrew Little: That one?Hon Dr NICK SMITH: No that is the 2008 standard righty-o? And here is the issue: why would you want to incur an expense of $3000 ripping out perfectly good insulation to gain only a few percentage points in insulation performance? It does not make sense. It does not stack up to cost benefits. You are going to impose more costs on people than you are going to impose benefits and this is where members of the Labour Opposition live in a world where when you impose regulatory requirements no one gets the cost. Yes you do. We need to—Andrew Little: You’re going backwards Nick.Hon Dr NICK SMITH:—we are going forwards. In fact let me just tell you how far we are going forward: 300000 homes insulated under—The CHAIRPERSON (Hon Trevor Mallard): I am just going to interrupt and admonish the Leader of the Opposition mainly because the responses coming—[Interruption] Well it is happening both ways. I remind members not to use the second person. Thank you.Hon Dr NICK SMITH: This bill’s provisions around insulation around smoke alarms around being able to enforce existing standards and around the abandonment notices and the retaliatory notices are a huge step forward for the standard of residential tenancy agreements. I just encourage Parliament to support this bill to drop the nit-picking and to actually focus on what is a big step up in the standard of New Zealand housing.CARMEL SEPULONI (Labour—Kelston): I am going to focus on a different aspect of this bill. I am looking at clause 17 in Part 1 “Section 661 amended (Landlord’s ongoing obligations)”. This clause is in relation to compliance in respect of smoke alarms and the compliance issues imposed on the landlord by regulations. The issue I have which I want to ask the Minister about is that when we were going through the select committee process the regulations for smoke alarms had not yet been determined. As I go through the regulatory impact statement in relation to smoke alarms again we seem to be presented with two options but again a decision seems not yet to have been made about what the regulations will look like. So when we are considering these compliance issues we do need to know what the regulations are in order to know whether or not we actually agree with the regulations and then therefore agree with them being imposed on the landlords.When considering the regulations I do want to bring up that there was much discussion around the smoke alarm regulations particularly in relation to having a period of time where landlords would still be able to use battery-powered smoke alarms. The issues that were raised by us on the select committee and also by some of the submitters were the issues with families being able to actually take the batteries out of the smoke alarms for other technical devices. It may seem ridiculous and some people might say—I would not say this—that it would be irresponsible of those people living in those homes. But you can imagine where there are low-income families then when you need a battery for another more urgent device you will take it out of a smoke alarm possibly. So the issue around that was that there was more of a push for the photoelectric alarms. They have long life—10 years.But in one of the options that we were presented with through the regulatory impact statement they would not be required unless the current alarm or the existing alarm which could be one of the battery-powered ones that I am talking about needed to be replaced and at that point the expectation would be on the landlord to put in a long-life 10-year photoelectric alarm. It is really difficult for us to envisage how that could possibly be monitored but that is what is in option 1 in the regulatory impact statement. So I would really like the Minister Dr Nick Smith to speak a little bit to that.I guess option 2 which we are presented with in the regulatory impact statement is even more concerning. Option 2 would involve the Ministry of Business Innovation and Employment (MBIE) educating landlords and tenants on the benefits of installing smoke alarms and ensuring that the alarms continue to work over time. This option as quoted in the regulatory impact statement “is essentially the status quo as the Fire Service currently runs a public information programme. It would not be a good use of taxpayer funds for MBIE to also conduct an education programme. Fire Service public information programmes have had relatively limited effect on reducing the incidence of residential fires among high-risk groups including low-income tenants.”From my perspective option 1 is better but given the problems with the battery-powered smoke detectors that we are talking about I still think it is an issue. So I really want to know how far along the Minister has got with considering the regulations for the smoke alarms so that when we vote for this bill when are considering this clause we will know absolutely what the compliance issues are going to be for the landlords and what regulations are going to be imposed on the landlords because at the moment that is not clear at all.I am going through the bill and I am wondering whether there are other clauses too—and maybe the Minister could enlighten us on this—in this bill that have regulation considerations that have not actually been entirely thought through yet. I think we need to know that. I think my colleagues and I will be going through this bill with a fine-tooth comb just to see where those areas may exist because it is as I said very difficult to agree with parts of the legislation when you are not even entirely sure what the regulations will look like. Thank you.METIRIA TUREI (Co-Leader—Green): I am disappointed in Nick Smith—I really am—for two reasons: first that we have a building and housing Minister who cannot tell the difference between a rental home and an office—and perhaps that explains some of the problems the country has when it comes to the housing crisis—and second that he would actually so devalue the lives of 500 children every month who are injured when they fall out of and more important through glass windows. I mean this is 500 kids a month. It is about 120-odd a week or 17 a day.So today 17 children will present at hospital with injuries ranging from cuts and bruises from toppling out of a window to severe slicing through their faces arms and legs as a result of crashing though glass windows and doors. That matters to me. Those 17 kids today matter to me the 120 this week matter to me and the 500 this month matter to me. The cost of preventing injuries to 17 kids today and 500 this month is that we require landlords as part of their general maintenance of the house where they have glass doors or windows that reach from the ground to 700 millimetres because that is what the building code requires to put in a visibility strip. It is like a slightly opaque kind of design sellotape. It is not tricky. It is not expensive. You can buy it from any hardware store in the country for a couple of bucks. That is one of the provisions in Supplementary Order Paper 172 in my name. That is all it would take and that alone would help prevent 500 kids a month from going to hospital with bruises and cuts and severe lacerations. I think that is a win for our kids and a win for our families. I think it is a win for landlords.Does anybody want to be a landlord whose tenant’s child smashes though a glass door and injures themselves or sometimes dies just because you could not be bothered getting some tape from Mitre 10 and putting in a glass strip? We do not want any of that happening in this country if we can avoid it. That is why we have regulations to help avoid these kinds of serious and expensive consequences from accidents like this. So I make no apology at all for wanting to protect 500 kids this month and 17 today from going to hospital because they fell through a glass door. So yes glass visibility strips are a critical part of a comprehensive warrant of fitness because they are one of the measures that will protect children from injury and help to save lives along with a range of other measures that are also in these provisions.I was talking earlier about Emma-Lita Bourne and about the fact that the home she was living in which contributed to her death did have a heater installed in it. But it was an inadequate one and no proper ventilation no certainty of being free from mould and no proper insulation meant that that family could not heat their home adequately and save her life. So if we are going to have regulation around what landlords need to provide to keep their homes warm safe and dry let us make sure that it actually will do that by making sure we include fixed space heating effective ventilation and a requirement that it is free from mould.There are other aspects in my Supplementary Order Paper. Effective window latches—this is one of the major issues that were reviewed during the Housing New Zealand test around a warrant of fitness—actually led to massive insecurity of homes. It was a huge risk factor for burglaries which made people feel insecure in their home. These are not difficult things to do. There are some other provisions in there that members can go through like securely locking doors fire egress and of course fire alarms because they do need to be installed as part of a comprehensive warrant of fitness.I would remind us too following on from Louisa Wall that children aged between zero and 3 spend 90 percent of their time in their home—so 90 percent of a child’s time between zero and 3 is spent inside their house. The quality and the condition of that house is absolutely critical to their health. We can make sure through relatively inexpensive measures good quality regulations and careful thought that every single one of those rental homes that these little babies are living in is warm and safe and dry and secure for them to live in. The consequences of not doing so we see being lived out every day: 40000 hospitalisations of children for respiratory illness as a result of cold damp homes.If we want to understand how effective a warrant of fitness can be for that the research on a comprehensive warrant of fitness has shown that in rental homes we can reduce hospitalisations of children by 19 percent—a nearly 20 percent reduction in hospital visits by children because of respiratory illness if we make sure that there is a comprehensive warrant of fitness for their homes. For a child who might be ill and go into hospital three or four or five times in a winter that is at least one fewer hospital visit for that child. In terms of 40000 hospitalisations a year thousands fewer is what we are talking about—thousands fewer children going to hospital because their homes make them sick. That is a win for us. That is a win for policy. That is a win for the Government.There is no cost here to the Government of a comprehensive warrant of fitness. It is not going to be expensive for the Government to require landlords to meet basic safety standards and have good quality homes that they rent out to families. Everybody wins. Landlords have better quality homes that over time they may well be able to rent for greater amounts improving the value of their property. The Government wins by having good quality policy that reduces hospital visits reduces accidents and reduces the financial burden on hospitals and ACC. Families win because they know that their kids are safe in their homes safe and secure warm and dry.So I find it impossible to understand why Nick Smith would pick on petty issues and make ridiculous claims about the provisions in my Supplementary Order Paper when he could choose to do something great for New Zealand families—something that is also great for him is part of his legacy as a Minister something that is great for the Government in terms of taking housing issues seriously something that is great for families and something that is great for the national budget—win win win. These are the solutions that the Greens are putting forward. They are good for the Government good for our economy good for our homes and good for our families. Thank you.DENIS O’ROURKE (NZ First): The major problem with this piece of legislation is not what it does but that it does not do it well enough. The main problem that we in New Zealand First see with it—we will continue to support the bill but we are disappointed in it—is the issue about non-uniform insulation standards. This bill does mean that properties built after 1978 with insulation standards that were in force at that time will for ever be permanently exempted from modern insulation standards—for ever exempted from that—and that is completely unacceptable to us. We would expect that over time all properties should have to come up to those standards.I listened to what Minister Nick Smith said about that and the excuse that he gave as to why he would allow that situation to continue to occur in the future under this bill. I forget the exact figure but he said that more than 80 percent of the modern insulation standard would be achieved by the 1978 standard. First of all I do not accept that that is the case. I do not accept that that is anything more than just an estimate and the reality is that that will be very patchy. There will be some well under that percentage and some no doubt considerably better than it. I built my home shortly after that time. I remember investigating standards and looking at what other people were doing and I found that there was a huge array of different solutions to the insulation of homes so factually I do not accept what the Minister said.The other excuse that members on the other side of the Chamber have given for not requiring all properties to come up to modern 2008 standards is the cost. The claim was made that if that cost was imposed on people with properties built after 1978 then that would mean significant rent increases and that that would be a problem for renting properties but that is completely untrue. That is not the way markets work because once a regulation is in force the whole level playing field just goes up a little. One property is not performing any better or worse than the other if that happens and there are no grounds for one landlord increasing rents more than another. So market competition simply means that the market can bear a certain amount and that is the amount that will determine the rent not whether the properties are being improved in terms of their insulation standard. So for that reason I do not accept the National members’ arguments either.What does of course increase rents is house prices and rents are based on the recovery of the cost of capital of houses. That today is what is really driving rent increases and anybody with half an ounce of common sense knows that if we continue to get the magnitude of house price increases that we are currently getting then inevitably that is going to push rents up and up and up and little or no proportion of those rent increases will come from having any requirement for an improved insulation standard. That is the truth of the situation there. I think that the National Government’s arguments in terms of those exemptions—which is what they effectively are—for 1978 properties from having the current standards is simply unacceptable.In fact if the Government really was concerned about rent increases arising from having a requirement for properties built after 1978 to improve insulation standards to current standards then why would it not for example allow landlords to expense the whole of the cost of that upgrade in the year that the expense was actually incurred? If that was done then what we would see is landlords wanting to do this voluntarily whether it was required in the regulations or not. I know that that is the case because I have talked to representatives of the landlords’ organisation and they have said to methat for a certain specified number of particular improvements—like insulation like improved heating facilities in homes—if they were allowed to expense those costs fully in the year that they were incurred then those people would invest much more readily and much more willingly in the improvements to their homes.So if the Government really is concerned about those issues then that is the sort of thing that it would do about it but we are not seeing that. So I do not accept at all the arguments that the Minister and the speakers from the other side of the Chamber have put up against requiring over time all properties to meet what we are calling now the 2008 insulation standards. There should be no difference whenever the property was improved or whenever it was built. What I would say is that if a property was built after 1978 because the insulation standards were better than before 1978 I would think it would be reasonable to have a longer period of time for compliance for properties built after 1978—maybe 7 or 8 years or something like that—but it should not be for ever. There should be a period within which all landlords know that today’s standards—the 2008 standards—are the standards that ultimately they will be required to have.Furthermore as technologies improve we should improve those standards and landlords should continue to have to meet those standards within a reasonable period of time no matter what those standards are and no matter when a property was built. That has got to be the objective—uniform standards for all properties—so that we get this very essential requirement for insulation at the highest achievable standard that we can in New Zealand and of course that will not be enough by itself.I want to refer lastly to Supplementary Order Paper 172 because the part of that that I particularly want to see is that heating and ventilation must also be subject to minimum requirements for performance of a property in terms of heating and ventilation—not just a list that space heating for example should be required but what the standard actually is. There is not much point in having very good insulation standards without having similar standards for performance of heating systems and for performance of ventilation.That should not of course apply only to rental properties. We have to try to see that those standards get met throughout New Zealand’s housing stock as soon as possible because as others have said the cost savings and the avoidance of illness and the avoidance of a whole raft of social problems that arise from this lack of standards in New Zealand are fundamental problems we have to address in this country and we need to try to get ourselves much closer to the kinds of standards that you see in North America in particular and in parts of Europe. So we need to aspire to that much.That is why I think I am so disappointed in this piece of legislation because it really does not go far enough. The Minister has criticised other parties for wanting to go too far. He should look in the mirror and see that the real problem is not them; it is him for not wanting to go far enough.Su’a WILLIAM SIO (Labour—Māngere): I want to make some preliminary statements and then make reference to clause 4 clause 23 and clause 37 of Part 1 and then if I have time I do want to speak in support of Metiria Turei’s Supplementary Order Paper 172.I want to put to this Committee that we have three significant crises that this country is facing. The first one is housing—the lack of affordable housing and cold and damp housing. The second one is the growing number of children living in poverty. The third one is the growing gap in equality. All three contribute to another growing crisis—that is sickly and unhealthy children—but I am told by those in the medical profession that if we get the affordable housing and if we get housing to be more warm and more healthy then we can fix the growing number of sickly and unhealthy children.Firstly I want to ask the Minister a question. In a statement that he released as a preamble to this bill he said that this bill was primarily about affordable or cheap insulation and yet I heard earlier that he talked about saving lives. I want to ask the Minister: what is the primary focus of this bill? Is it about cheap insulation or about saving lives? I put it to you that if you are saying it is about saving lives then I do not believe—I have to agree with my colleague who spoke earlier Denis O’Rourke—that you are going to achieve that. And I do not believe the figures that you have put out particularly when you hear the Children’s Commissioner say that as a result of cold damp and unhealthy housing we have 42000 kids going to hospital and 15 deaths a year. Am I correct—it is 15?Hon Member: Yes that’s right.Su’a WILLIAM SIO: So I am asking the Minister: is it true that the primary focus of this bill is about saving lives or is it true what he released in a preamble statement leading to this bill that it was about cheap insulation? I do not believe that you can have both. If you are going to save the lives of children and families at risk then you cannot have the primary focus of this bill being cheap insulation. It concerns me what has been raised earlier that those houses that were built prior to 1978 will get insulation retrofitted but those houses built after 1978 will remain as they are.I have to say that many of the houses in South Auckland go back to the 1940s but some of the new houses that come after 1978 do not have insulation. These were built—I think the Hon Maurice Williamson made reference to it—during the period of those homes that had the leaky home syndrome. These were the houses that were built during that era after 1978—the 1980s. So those houses are not going to be healthy or safe for children if we are not going to compel their owners to retrofit them with insulation that is of the time. By leaving out those houses that were built after 1978 you have got a gap of 33 years.I do ask the Minister: is this about saving lives or is it about providing cheap insulation? If it is about providing cheap insulation there we go again—you lead yourself to the condemnation of the public because the public will be seeing this and they will say: “There he goes again—supporting his mates rather than doing the right thing for the country.” I want to then ask in terms of clause 4 of Part 1: do the provisions that extend insulation apply to garages and to sleepouts? Because—Hon Member: What about cars?Su’a WILLIAM SIO: And cars—well ha ha! Right now at this very moment we have a number of families with children living in garages—garages with concrete floors. There is no insulation on the walls. There is merely a piece of iron around that and a boarding up against the wall but there is also no insulation.Hon Dr NICK SMITH (Minister for Building and Housing): I want to rise to the challenge of the points that were made by both Denis O’Rourke and Su’a William Sio who has just spoken. Firstly he says the Residential Tenancies Amendment Bill is about cheap insulation. No it is not. Let me be very clear: the bill and the regulations require that all insulation to be installed is to the 2008 standard—absolutely. He asks the question as to whether cost should be a factor in the policy making. Of course it should because all costs that we impose through regulation of this sort are ultimately passed on to the tenant and we have to be confident that the benefit is more than the cost. So here is my challenge for Mr O’Rourke and Mr Su’a William Sio and it is this—Hon Members: Sio.Hon Dr NICK SMITH: —Sio—when it came to the earthquake-prone buildings legislation this Parliament did not require that every single building be upgraded to today’s standard. Were we as a Parliament saying that lives do not matter? No we were saying quite logically that there needs to be an upgrade of older buildings but that it is not realistic that every older building meets the same standard today.I challenge the member on this point: the current new regulations require every home in New Zealand to have double glazing. Why do we not put in this bill that every house has to retrospectively get double glazing? If you want to follow the logic that you have advanced which is that every building has to be to the same standard that is what you would do. The reason we do not do that is not because we do not care about children or about home warmth; it is because we are economically rational. If we required every home to meet today’s standard and to be double glazed—if you believe what you say you would actually put in this bill that every home has to be double glazed because that is the current standard. But we do not because the cost that that would impose would exceed the benefit.Here is the bit that I do not think is understood: the 1978 standard provides for an 83 percent reduction in heat loss. The 2001 standard—they are the facts; they are the technical statistics the R rating. In respect of the 2001 standard that takes it to 87 percent and the simple logic is this: insulating the 180000 homes that are not insulated at all of which you are getting no reduction in heat loss is where the massive gains are to be made. Members opposite are completely underestimating the challenge for the insulation industry to do 60000 homes per year over the next 3 years which in my advice is going to stretch that industry to its absolute limits. That is my view: the cost-benefit analysis is overwhelming in saying that the benefits come from those houses that are uninsulated. Furthermore this bill requires that where the insulation from 1978 is not in fit and proper condition it does need to be upgraded and when it is upgraded it is upgraded to the 2008 standard. That is logical that is consistent that is the right thing for New Zealand families and it is the right thing for New Zealand homes.PEENI HENARE (Labour—Tāmaki Makaurau): Ka pai Mr Chairman. Thank you very much for allowing me this opportunity. I rise to make a brief contribution to this debate and I want to speak specifically to clause 37 in respect of the installation of smoke alarms. Minister Nick Smith has just mentioned to us that we are underestimating the cost that it has to be economically viable and sustainable and all of this choice jargon. I received a text message from one of my constituents who is actually watching right now in one of the libraries in South Auckland. Let me explain what is “economically viable” for that constituent—and it is a matter of dollars and cents just as the Minister has already mentioned. In this particular clause there will be an onus placed upon the tenant to replace flat batteries in the alarms. I understand the reasons around safety because we do see a heck of a lot of unnecessary house fires in communities whether they are rural or in the city but this particular constituent of mine said that after his expenses go out for rent and for those urgent expenses that are required to maintain life for him and his family he is left with $15—$15—to make sure he can put kai on the table for his family.Although this might seem just a silly little bit in the bill when you place an expectation on a tenant who struggles on $15 per week to feed their family you place on them an expectation to buy say in a standard three-bedroom home three smoke alarms. You have one in the lounge or open living area—it usually covers the dining room as well—one near the kitchen which makes sense and generally one in the hallway which will cover the bedrooms. I am afraid that the price of those batteries is just beyond the reach of some of our families. I know that sounds petty and minuscule to some in the Committee here but I can tell you that if it is a matter of dollars and cents for those who come through into my offices then they struggle to meet those costs. They struggle to meet emergency situations—a flat tyre for example—where costs are really high. Even the smallest of price increases in their weekly budget which they must factor into their budgeting throughout the week or throughout the month—however they might be paid—just those small things are a real challenge for those people.While continuing on this point I want to consider the current crisis. I want in relation to smoke alarms think about the emergency housing situation. I also want to think about the emergency housing situation that is being met right now by the likes of Te Puea Marae. Some of the compliance requirements for those emergency houses—I know this legislation says “private rentals”—I wonder how we can then boost these kinds of protections for those who are providing these necessary services. Some of those people were mentioned by my colleague Su’a William Sio who talked about garages and the need for those to be insulated and have a fire alarm placed inside them. That is even more important in my constituency when I consider a particular house I recently visited. Will there be compliance requirements for that private rental property? The garage is also being rented out by the person who owns that property so essentially there are two dwellings on the property where separate families are living. I wonder whether these particular amendments to the bill will require those other dwellings like a garage—and like a carport as we have seen very recently—to meet any particular standard that will provide a warm safe dry and healthy home for those families and those resident in those homes; and safe by way of fire alarms.I consider Supplementary Order Paper 172 presented to the Committee by Metiria Turei and I think it is probably a fair reflection of what is not being done by this Government. Why? Because if you look at the Supplementary Order Paper you will see a heck of a lot of recommendations—[Bell rung] Mr Chair?The CHAIRPERSON (Hon Chester Borrows): Peeni Henare.PEENI HENARE: Excellent Mr Chair thank you very much. You will see quite a large number of amendments being proposed in this Supplementary Order Paper in the hope that we can actually fix the problem—fix the problem not tinker around the edges. This is because what this particular bill that we are debating at the moment proposes is a “steady as she goes” approach—that there is actually not a crisis. We will turn a few knobs here pull a few strings there in the hope that longer term we will have a solution to some of the issues. That is literally tinkering around the edges and not doing enough.Now to Metiria Turei’s fantastic Supplementary Order Paper which details what I consider to be some pretty standard human rights—some of them are as simple as adequate cooking facilities. I wonder whether there are kitchens in the sheds in South Auckland? Probably not. I wonder whether there are places where there is a bath a shower or a toilet with proper sewage disposal in a lot of those sheds that are being rented out as a second dwelling on one property? Probably not. So I want to support Metiria Turei’s Supplementary Order Paper to the Committee today and once again emphasise the fact that this bill just does not go quite far enough.Just going back to clause 37: I know there are small technical things in bills such as this but the word “may” keeps coming up. I consider that the word should be “must”. It should be “must” in many cases and in particular this one where it actually forces the landlords who own these properties to comply and to make sure that smoke alarms go into houses. It sounds like a small word but it is an important word in the scheme of things. I wonder whether Minister Smith or some of the other members from the other side of the Chamber can just address some of those things because they are questions that we all have. They are questions around the safety of our families and they are questions that must be answered in order to fix this housing crisis.I end by saying once again that this bill is just not good enough and it is not big enough. OK we will be supporting it but we do have huge reservations and we also have some other views that we hope to express. Kia ora.ALFRED NGARO (National): It is quite an honour to be able to take a call. I want to start by first acknowledging the comment by Mr Peeni Henare when he said that small things do make a big difference. I absolutely agree. For almost 20 years I worked in the community of Glen Innes—for a number of years—which had the largest State housing stock in New Zealand at one stage. Almost 2500 homes were there. I know that in working with a small trust with the families the children and the young people in that community and wanting to meet their needs—I know there were many times that there were cold homes that I went into. There were homes in which there were people who were struggling where there was poverty and where there were issues.Although the talk on the other side is about housing poverty and health conditions I saw all those three things and under a Labour Government of 9 years not once did I see any change in that. I can name the streets: Fenwick Avenue that is there; Flanders Street; and Ropata Avenue. Those are the streets with houses that families were in and not once in those 9 years did I see insulation going into those homes addressing the issues of poverty. Even the Salvation Army’s state of the nation report talked about how that needed to happen.But I am talking about the bill here in its Committee stage. What is really important are the issues. I want to address the issues around insulation because talking about insulation—there has been outcry over the fact that this does not meet the standard. I understand that many of those members may not have had the report. We know that the Building Research Association of New Zealand (BRANZ) had a report and a survey. It said that there were 450000 homes out there that needed some form of insulation. When Mr O’Rourke talked about the sense of uniform ability—well if he had read the report he would realise that at least 100000 of those homes are unable to be insulated because of their physical dimensions.I want to point to the two different sizes of insulation that have been making their way around the Opposition benches. Having come from a construction background as an electrician by trade what I can say to you is this: while they can bandy around and show two different forms of insulation what they will not understand is that to truly insulate a property and a home it is like for instance how you need to think about a chilly bin or a cooler. In order to get 100 percent insulation you need to make sure it is watertight and airtight. You cannot do that in a house but what you can do is move towards that with double-glazing of windows. It is insulation in ceilings and in the floor—that is what this Government is moving towards. That is what this bill is moving towards and has the best reasonable and rational point of view in what it is doing.What do we say then to the point of insulation from 1978? Well there was an energy performance survey that was done in which it clearly states that obviously from 1978 the sealing of the insulation that was installed to the new standard of 2008—when the Opposition members talk about it they will keep holding up the two different levels of insulation. If you take the technical aspect—not just your own philosophy or ideology—the technical issue is that from that form of insulation to this form of insulation the efficacy and the efficiency that you will try to gain is not there. As long as the insulation retains itself to that 1978 standard—to try to include that is not there. The technical aspect of different insulation does not weigh up.Let us go a little bit further than that because the BRANZ report clearly states this: the average cost of insulation is $3400 per home for ceiling and floor right? Therefore if you were to upgrade that form of insulation to try to get it back to what you would call the standard of 2008 what is the cost? It is $2800 on average. Where is the cost saving in that? There is none. There is no cost saving.But here is the question that Mr O’Rourke then brought: will that cost go back to the tenants? He said that of course it will not. Mr O’Rourke needs to realise this: over 70 percent to almost 80 percent of current landlords in New Zealand are who? They are mum and dad investors with one rental property. That is the average. They are good people who are out in our communities who want to do the right thing and who are doing the right thing. That is what we are saying inside of this legislation. If we are going to try to have a uniform response to try to make sure that everyone has to impose these costs then mum and dad and average investors will simply say: “We have to push this cost on to the tenant.” That is not rational. That is not reasonable. That is the reason why we believe the standards that we are taking are making a difference.I just want to make some other comments in regard to regulatory powers that are inside the bill. There was the issue around ventilation. The Housing Improvement Regulations 1947 clearly state the fact that households need to provide adequate ventilation and also the heating that is inside of that. The question was asked to the Ministry of Business Innovation and Employment (MBIE) and it looked and reviewed this. What clearly came back from MBIE was this: that the cost that is incurred will be passed on to the tenant.JACINDA ARDERN (Labour): We have had a lot of discussion about cost-benefit analysis and obviously with any significant legislative change there is an expectation not just because of the requirements around setting out regulatory impact statements that at least some cost-benefit analysis is done. But it is really up to a Minister and a department to factor in the range of issues that they would like to include in that cost-benefit analysis. In this debate an area that seems to be severely lacking in the Minister for Building and Housing’s logic around the cost of for instance including standards in the Residential Tenancies Amendment Bill around heating or even including higher standards around insulation is that it does not factor in the cost to the State in the cost-benefit analysis of some of the issues around living in cold and damp housing.I would actually really like to hear from the Minister about what he considers to be an adequate cost-benefit analysis because he describes this bill as economically rational when for instance the cost to the State of rheumatic fever for a child is between $300000 and $500000. Obviously the Government does consider that to be a cost worth mitigating because why else would it have made it one of its Better Public Services targets. It has implemented ways to screen by swabbing children for streptococcus and treating children with antibiotics but actually if we were serious about prevention in this space we would acknowledge that you cannot pick up a child who is not at school—because that is where the children are being swabbed—and so if you really want to prevent further incidences you would look to the source which is cold damp overcrowded housing.So I think that it would make very good sense to include in a cost-benefit analysis the cost of the diseases of poverty and overcrowding but also those that are directly influenced by—Hon Dr Nick Smith: They have.JACINDA ARDERN: If the Minister says that they have I would welcome then further detail on why it is that in his cost-benefit analysis where we have over 40000 children admitted to hospital per annum it did not make economic sense in his mind to add for example heating and higher standards around insulation in this instance because—Hon Dr Nick Smith: It’s already in the regulations.JACINDA ARDERN: It does not make economic sense for the State to bear the burden of that cost because the ministry has made an assumption that if that went to a landlord—and I challenge this assumption—and we required landlords to provide a source of heating they would automatically put that cost on to their tenants. I actually question that rationale. Alfred Ngaro has said that mum and dad investors are the people we are talking about here who would be impacted by changes like that—I do not disagree with that—and that they want to be good landlords and those are the people whom we would be putting this cost on to who would naturally then pass it on.I question the decision making there to assume that every single landlord would put that cost on to the tenant. I have been a tenant for most of my life living in properties outside of my family home. I have had continual upgrades to different properties that I have lived in. Not once has that upgrade come at a cost where that landlord has said to me: “Because I have made this adjustment to the property that you are in I am now going to immediately charge you more in your rent.” I have not had that experience. We have made an assumption here—an assumption that we want the tenant to bear the brunt of poor quality housing because the trade-off is that they will paying more.Tenants are paying more because we have a housing crisis—let us be clear on that. That is the reason why tenants are primarily paying more. Why not have a requirement that landlords do right by their tenants because actually I have a belief that there are a good number of landlords who would not necessarily pass that on. For those who would not—those who are the slum landlords—let us make them provide quality housing. What is wrong with that? Why should we as a State bear the burden of the cost of children being hospitalised whilst we allow landlords to get away with not providing quality housing?DENISE ROCHE (Green): I rise to take a short call on this. I want to address the Supplementary Order Paper that my colleague Metiria Turei has put forward. But before I do that I just want to make a couple of general comments. I think I will start by saying that essentially what we have got in New Zealand is housing stock rental accommodation that is substandard. How do we know that? We know that because there are according to the Children’s Commissioner 42000 hospital visits per year with 15 children dying every year because of substandard housing with poor insulation. We know that because we have seen so many people who are desperate for housing who are living in sheds who are living in garages and who are living in caravans and even in cars. I blame this Government because it has not addressed the housing crisis that has enabled bad landlords to continue to provide poor rental accommodation. It is about time that we did something about it.The Minister said earlier that we do have regulations. But they are being flouted. There are so many different examples of people who are living in substandard housing where if there are regulations their landlords are not meeting them anyway. I have examples of that in my own community where I have some friends who essentially were renting a house in which in the end they basically could not turn on the electricity because the wiring was so poor let alone heat the home in the middle of winter. When they asked for that to be fixed it just did not happen and so they moved out. But the landlord put that property on the market and another desperate family moved in with no repairs being undertaken whatsoever.I want to refer to some of the submissions that came through that support the measures that my colleague Metiria Turei has put in the Supplementary Order Paper. These were particularly from the Citizens Advice Bureau that said that it has had a 40 percent increase in inquiries related to residential tenancies in the last 5 years. I believe that reflects the fact that there is a wide breach of minimum standards from landlords and it is probably why the bureau supports more regulation for the protection of tenants. That is what we should be aiming at. We should be remembering that a home when it is rented is a home; it is not just a rental property and not just a way for the landlord to make money. If we focus on that then we should be focusing on the rights of tenants as well: the right to warm safe dry affordable housing is the first point but the second point is around security of tenancy. This is why we have in the Supplementary Order Paper a right of renewal for tenants after 3 years.I grew up in rental accommodation provided by the State through the railways. About 10 or 11 years of my life was spent in one rental property. That enabled me to go to one school to have one community that I was part of and to be very very stable. We have seen through various reports the declining education outcomes from children who are shifting from house to house to house because their rental properties are not secure and who have to move because they are facing rent increases. That is another reason why we want rights for tenants that include that any increases in rent need to be part of the rental agreement at the beginning. And it has to be justified so that we do not have families who are facing major rental increases are unable to budget and are having to shift into cheaper accommodation—and upsetting interfering and interrupting the education of their children.When you move into a home it is a home and that means that you are part of a community—that is where the schools are—KRIS FAAFOI (Labour—Mana): It is a genuine pleasure to speak to the Residential Tenancies Amendment Bill. Can I refer to clause 38 which I think a number of my colleagues have referred to previously in the debate.Like Denise Roche who said in her speech that she grew up in a railway house I too spent most of my younger years in a State house in Christchurch. I do not think I left it until I was about 20. I think my parents moved in there about 1976 so it would have been prior to the 1978 age of insulation. I think my colleague Jacinda Ardern poses a decent question to ask of the Minister for Building and Housing around any work the Government has done around how this piece of work will make the lives of those people in low to medium income families better off and safer and healthier in those homes. The reason I ask that is that I grew up in one of those homes. I suffered from asthma; I still do to this day and I think it is because of the lack of decent insulation my family home had that I still suffer from asthma from time to time—sometimes it is due to my own management but most of it I believe is because of the home that I grew up in. I do not say that lightly. There were a couple of occasions my late father told me when the doctor said “Well that was a close one.” when I was young because I had such bad asthma attacks that I nearly died.I believe we come to this House with a responsibility to make the lives of people who follow us markedly better. It is certainly one of the things I push for in my own electorate. With all sincerity and all generosity and fairness to the Government although it is trying to make an effort with this piece of legislation I do not think it goes far enough. I fear that the same kind of experiences that my family went through with me having asthma when I grew up will happen to families who grow up in the same poorly insulated homes which we are allowing to continue to happen under this piece of legislation. On this side of the Chamber we have argued that as well as insulation there needs to be a decent mode of heating—something again that my family did not have. We had fan heaters which cost us far too much to run—and I am talking here of the 1980s and 1990s.I am asking in all seriousness why families who are on low incomes and in poorly insulated houses have to go through the same experience my family went through 20 years ago. Why should parents have to worry about their children who get constantly admitted into hospital with illnesses like asthma like me—and in some cases those children will pass away unnecessarily—because we here in Parliament have not learnt the lessons of 20 to 30 years ago?I do not think my parents overly enjoyed the experience of taking me to the hospital and seeing me nearly pass away from an asthma attack yet in this Parliament we seriously think it is OK to let the conditions of a 1978 insulation standard continue to be OK for families here in New Zealand. It is simply not good enough. I was one of the lucky ones but I still go to hospital every so often with an asthma attack. But why should we allow this to continue to happen?Someone from that side of the Chamber—and they already have—stood up and said: “Well what did you guys do in your last period of Government?”. Are we here to sit here and continue to play politics like that?Hon Jo Goodhew: Ha!KRIS FAAFOI: Is that all you are going to say? And there is laughter over there. But I do not think it is good enough that we allow conditions in terms of heating and insulation to continue to be those of 1978 1980s and 1990s standards. The Government members can laugh at my speech—they can say whatever they like—but what I think is that we deserve to do better for the families out there like mine who are living in these substandard conditions and who do not want their kids to go to hospital with life-threatening illnesses not just once but constantly.I think we owe it to the people of New Zealand who are in these conditions and these substandard houses to make sure that they can live a decent life. I was lucky enough to do that because my parents cared for me and looked after me and I think other families deserve that too. When people ask why I am a member of Parliament I say it is because I got the lucky chance to have a decent home and be looked after and I am in Parliament to be able to make sure we do better for the children in New Zealand. We can do better and we must do better.STUART NASH (Labour—Napier): I would like to talk first and foremost about something called a social contract. The social contract is a philosophical term and it talks about the moral and the political obligations that are dependent upon members of society to look after the health and well-being of others. Basically what it says is we have an obligation to build the sort of society within which we all like to live. This is where I think every single landlord understands the social contract and if they do not we legislate to make sure they abide by the moral and social obligations that society has put on them.I would agree with Mr Faafoi and other speakers that this bill does not go far enough in this. There is an implied social contract and that is that a landlord will provide a tenant with a warm dry safe home. It does not matter whether it is a private landlord or the Government in the form of State houses. Insulation I believe is a fundamental part of that social contract when we are talking about tenancy and when we are talking about rental accommodation.If we talk about the sort of society we want to create—and this is related to clause 38 with regard to insulation—I think that most of us find for example rheumatic fever which is a disease of poverty to be abhorrent. The cost to the health system of a child diagnosed with rheumatic fever from when they are diagnosed to when they die about 50 years later is about $1 million per person. It is extremely high. So I think we have to enforce this obligation on landlords to provide tenants the sort of warm dry house the landlord himself or herself would be prepared to live in or put their own children in.I am a landlord myself. Last winter I installed four heat pumps in a block of apartments. I can tell you that I did not change the rent one cent. The reason for that is that I reject the Minister for Building and Housing’s argument that if we impose a cost on the landlord then that will only translate into higher rents because what determines the rent is in fact the market. If I had said “What I’m going to do is I’m going to put up the rent by $3000 a year for every single one of my tenants in this block of apartments.” they would have been well within their rights to say “If that is the case then we are handing in our notice.” and I could well have ended up with an empty apartment.For me—and I know for a lot of landlords—the ability to have tenants in there that are going to stay for a long time is much more important than ramping up the cost every single time I possibly can. I have not increased the rent at all and yet I have installed four heat pumps. That is because that is how the market works and I reject the notion that placing an obligation on landlords to provide warm dry healthy homes means an increase in rent because that is not the case. The market determines the rent and tenants have the ability if the rent is too high to say “I’m not going to stay here anymore.”When we talk about insulation the evidence is incredibly clear. If a person or a child or a family lives in a home that is warm and dry then it is safe and it is healthy. My son is in hospital at the moment. I do not want to talk about my son—I do not want to bring my family into the debate—but on the wall in the children’s ward there is a list of 10 things that children need. One of those things is a warm safe dry environment. What children do not need is to live in homes that do not provide them with the sort of security they require to be the best they possibly can be.I just think it is inherently unfair to not require landlords to provide that sort of house. Not to do that is manifestly wrong and I think it breaches the implied social contract between society Parliament the Government and those who rent a house for whatever reason. Let us be honest about this. We have talked about the housing crisis in a number of ways and I would like to acknowledge as someone who lives in Napier that the housing crisis is not simply an Auckland issue at all. There are 130 people on the waiting list in Napier. This is a crisis that goes across the country and I want that to be known because this is often assumed to be simply an Auckland crisis. It is not. But we must provide tenants with warm dry homes.Dr PARMJEET PARMAR (National): It is a pleasure to rise and take this call. The Opposition has been going on and on about heating and ventilation so I would like to talk about clause 13 which amends section 45 of the Residential Tenancies Act which states the landlord’s obligations. Yes the landlord’s obligation does not include heating and ventilation as a minimum requirement. There are significant reasons for that. No. 1 is the evidence. The evidence shows that most benefits in terms of health outcomes related to cold houses can be obtained by insulating uninsulated houses rather than adding heating to insulated houses. So it is based on evidence. Yes I understand—it is technical. It is difficult to comprehend. That is why a technical advisory group was set up to look into the idea of a warrant of fitness. That group did come up with ideas for ventilating bathrooms but later on dropped that as a minimum requirement because it realised that that is linked to the behaviour of the person in the house. So it will be the tenants’ obligation to ventilate the bathroom.Given the lack of evidence of adding all of these requirements on top of the requirements that are in this bill I do not see any sense in that. I do not see any sense in that. This is all based on evidence and based on the evidence we are focused on insulation.A second point I want to talk about is clause 6 and I also want to talk about the Green member’s Supplementary Order Paper 172. I do not support that Supplementary Order Paper. The Green member Metiria Turei says that there should be calculations indicating increases in rent. That is not possible because we cannot base this on any baseless assumptions that all landlords will be able to absorb the costs that we keep imposing on them. Every landlord is in a different situation. Some landlords can put in heat pumps and may not pass the cost on to the tenants but others might have to simply because they just cannot afford it.The second thing is that landlords love to have long-term tenants but sometimes if landlords want their property back for some reason they should be able to give notice to their tenants to get their property back. Clause 6 also requires landlords to specify the extent of insulation. They are required to include that in the tenancy agreement. If the house is exempt from that requirement then the landlords are also required to provide that statement in the tenancy agreement. That is a good thing because we are putting the responsibility on to landlords to assess the property and provide that assessment and statement accordingly to their tenants. Yes if tenants feel that they have been given the wrong information that they are not satisfied with the state of the house or that it does not match with the statement that is provided by the landlord then they can get an independent assessment done. They can go to the Tenancy Tribunal and they can get a work order issued for work to be done on that property.We heard about a warrant of fitness for houses. We have been hearing that continually from the Opposition. But the idea of having a kind of warrant of fitness—having an independent body assessing houses—is going to cost. Yes it does cost. These things do cost. We did a cost-benefit analysis. Yes cost-benefit analyses are important. You cannot dismiss them. The cost-benefit analysis said that it would cost $100 million a year—$100 million a year. Yes landlords will pass that cost on to their tenants. So if I break it down to the cost per house it comes to $225 a year for a tenant. This is without providing any additional benefits. So how is it fair to pass on this kind of cost to tenants when there is no benefit for them?The member opposite Peeni Henare spoke about a family he knows that is left with just $15 after paying their rent. This is $15 per week. If this cost of $225 is passed on to that family they will be left with just $10 a week. How fair is that? It is not fair. We do not think that the idea of having a warrant of fitness is good. If I speak about the amounts for unlawful acts I believe that they are very reasonable after the changes that have come after the select committee process especially for breaches under section 54(3) inserted by clause 15 for a retaliatory termination notice. We know that these kinds of notices are not uncommon. After looking at that we decided to increase the amount from $2000 to $4000. Looking at other amounts that are there for unlawful acts to make sure that landlords are complying and also to make sure that tenants are complying—for example if tenants fiddle with their smoke alarms they can be fined up to $3000. When looking at these things I believe that this is reasonable.PHIL TWYFORD (Labour—Te Atatū): The Minister for Building and Housing the Hon Dr Nick Smith in his last contribution I think if I am correct urged the Committee to stop what he called nit-picking. I was kind of reflecting on this—that the Minister thinks that the criticisms that the Opposition have of his bill are nit-picking. We have a lot of fun on this side of the House at the expense of Dr Smith. It is mostly because there is such a big gulf between the scale of the housing crisis and this endless procession of half measures that he brings to the House and to the public. That is why we have so much fun at his expense.Nevertheless the Residential Tenancies Amendment Bill deserves to be treated with some gravity because it is something. It is something. After prevaricating for several years the Minister has brought a bill to the House that actually does contain some good stuff. It does actually set some standards for insulation and smoke alarms. It has comprehensive provisions that put in place the machinery of government that will be necessary in the future to administer and enforce some proper and decent standards about the quality of housing. That is something and that is why we are voting for this bill.But the sad thing about it is that it falls so far short of what the Minister could be doing. He knows that credible New Zealand research and evidence shows that $1 invested in retro-fitting houses through insulation and modern affordable heating saves $5 to $6 in future public health expenditure. That is the cost-benefit analysis and that is why we cannot understand on this side of the Chamber why the Minister is legislating in this bill redundant insulation standards that go back to 1978. That is the shame of it. When this bill passes—as it will because National has the numbers in the House—hundreds of thousands of rental properties in New Zealand that are currently insulated to the 1978 standard will not have to be upgraded to the current 2008 standard. That is the shame of this bill and that is the poverty of ambition that underlies so much of this Minister’s housing policy.The reason for the deficiencies the rationale for the deficiencies at the heart of this bill is that it would be too much of a burden on landlords. The Minister is clearly afraid that requiring for example a $3000 heat pump will be such a burden on landlords that they will have to put the rent up. My colleague Stuart Nash has put paid to that assertion. We know everybody knows the Minister knows that rents are set by supply and demand. Just because a landlord has to replace the roof because it is leaking and spends $10000 on replacing it the landlord cannot put up the rent to recover that cost from the hapless tenant.If you consider the case of heat pumps a heat pump might cost let us say at most $3500. A modern heat pump would have a lifetime of 15 years. Over that time across the country an average rental property with an average weekly rent of $440 would generate gross revenue of $340000. If it is an Auckland property with an average rent of $520 a week the gross revenue over the 15-year period the lifetime of that heat pump would be $400000. To suggest that requiring a landlord to invest $3500 in a heat pump is going to force them to put up the rent and throw the tenants out on the street which is the argument that the Minister has repeatedly used is a complete nonsense. It will not happen. It is simply a cover for this Minister’s refusal to do the right thing.By taking this position the Minister is standing up for slum landlords. As an earlier speaker said there are good mum and dad landlords and professional landlords all over the country who understand the importance of making sure that their rental property is not a threat to the life and health of their tenants.Hon DAMIEN O’CONNOR (Labour—West Coast - Tasman): Mostly I am proud to be in this House but sometimes I am absolutely ashamed. People out there must think this is a place of such hypocrisy when they listen to this debate. We have spent tens if not hundreds of hours in recent times debating health and safety legislation in this House to protect the lives of New Zealanders because we had a terrible tragedy in my area where 29 people lost their lives.On this particular issue the Children’s Commissioner came to the Social Services Committee and said there are “42000 [hospital] admissions” and “fifteen children a year die” because they are in cold damp homes. This is an outrage. Where in the health and safety legislation did we say: “Oh it is OK to have a few New Zealanders die?”. Did we say that? No we did not. Yet in this legislation the Government is saying it is OK to let 15 children a year die—quoting the Children’s Commissioner. The Government made a promise to New Zealand children: “We will make your house healthy.” Three years on from that Budget promise this bill will do little for children living in cold damp mouldy housing. It is a wasted opportunity and a broken promise to our children. I do not want to be part of a hypocritical Parliament that on one hand stands up for the rights of working New Zealanders which is good but here today does not stand up for the rights of the 15 children who will die every year because this Government is not prepared to legislate for proper healthy safe and dry homes. That is what we are talking about here.We have a Government that is running a review of Child Youth and Family because there are faults in the care of children who need care. We have got people marching in the streets for the tragedy of poor Moko Rangitoheriri who lost his life because of terrible terrible domestic violence that is rife throughout our country. And so it should be that people speak out but when we get to Parliament where the Government has the right—the obligation I would say—to put in place legislation that does the very best possible for young children in this country it is failing.The CHAIRPERSON (Lindsay Tisch): Order! Back on the bill.Hon DAMIEN O’CONNOR: It has failed and it is on this legislation.Just as the Royal Commission on the Pike River Coal Mine Tragedy said we had to change legislation to protect New Zealanders in mines and other places the Children’s Commissioner comes into the Parliament and says there are 42000 hospital admissions per year and 15 children dying per year from houses that are not adequately insulated or heated. And this Government says: “Oh no we have got to have an exception. We have got to have an exception for old properties and old insulation methods.” We did not say that in the health and safety legislation. We did not say that some could abide by a lesser standard and that is OK and we will allow those poor New Zealanders working in those conditions to take a greater risk but we are saying that here in this piece of legislation.The National Government has bowed over once again to landlords who are putting children every single day at risk in this country. It is not unusual I have to say. I have battled to try to get lower speed limits outside schools. Somehow whether it is because they do not vote or whatever children do not get the same level of care and protection that they should.This is an opportunity for the Government to show that it really does care and it does not just bring to the House hypocritical pieces of legislation—because that is what it is: moving one step forward but leaving a big gap that most likely the most vulnerable children in our country the ones who can pay the lowest rent in the oldest houses will fall into. But no we are not going to give them a guarantee of warmth of a dry home or of a safe home—never mind the fact that the Government does not even want to give them a home.This is a disgraceful piece of legislation and the Government is not protecting the children in this country which it should be doing each and every day.JENNY SALESA (Labour—Manukau East): Thank you for this call on the Residential Tenancies Amendment Bill. Putting in place a legal framework to ensure that residential tenants are renting safe and healthy homes is crucial. This bill proposes to introduce some useful provisions towards providing standards for housing in private rentals but it does not go far enough in addressing the dreadful circumstances that many families are living in especially as we go into winter.I would like to tautoko my colleague the Hon Damien O’Connor. We have a responsibility as parliamentarians—121 of us chosen by our constituents to come into this Committee—to do our best to save children’s lives. When we sit on this side we hear members of Parliament particularly from the other side talking about the cost and how it is too expensive to heat and to insulate houses but when you actually put to the other side that we are talking about children’s lives—children’s lives—we should actually feel a little bit ashamed or maybe a lot ashamed that we are not doing what we as responsible MPs should be doing.Minimum insulation standards for private rental houses are a step in the right direction—they are. However this National Government should do more. This bill proposes a minimum insulation standard. When you insulate a cold house that house still remains cold. When you insulate a cold house but you do not put in efficient modern heating do you think that house will magically become warm dry and healthy? No it will not. I agree with Dr Russell Wills; this bill should do much better for our children. This is a shameful bill. This is an opportunity to do right by our children but we are not doing that. Rental houses need to be warm dry and healthy.My question as we talk about insulating houses is whether we are also going to ensure minimum insulation for garages. Just this last week we saw so many garages where families are living. I do not think this current legislation actually covers minimum insulation for garages but it is a reality that we have too many families living in garages and as we go into winter we should also consider the fact there are families that have been forced out of houses—forced out of houses—to live in cars as well as in garages. They also need to live in warm dry conditions.The Productivity Commission stated in its report on housing affordability that “Generally the quality of New Zealand’s housing stock is considered to be poor.” This issue of quality applies to private houses as well as to Housing New Zealand State houses. In the Auckland Regional Public Health Service submission to the Health Committee it stated that “New Zealand currently has a high proportion of unhealthy rental homes and the average temperature in almost a third of New Zealand homes is below World Health Organization (WHO) recommendations.” The WHO recommends a minimum indoor temperature of 18°C for most people and if you are a child if you are elderly or if you are disabled it recommends 21 degrees for a house. But in this country the mean temperature in Auckland homes which is what was in this submission is around 16.5 degrees; 16.5 degrees is pretty cold. That is something this legislation should actually cover: insulation as well as minimum standards of heating.Clause 6 of this bill covers information that must be included in tenancy agreements. Clause 6(3) would require a landlord to describe the insulation that is installed at a property he or she is renting out. Omitting to provide this information would be an unlawful act. This bill came back from the Social Services Committee with an amended clause 6(3) where landlords would be allowed to state that despite making all reasonable efforts they have not been able to satisfy themselves of the extent of the insulation. So I worry that this is a fairly slippery set of requirements whereby insulation that is too onerous—MAUREEN PUGH (National): It is my pleasure to stand and speak to this the Residential Tenancies Amendment Bill in its Committee stage today. I want to take this opportunity to note my thanks to the Hon Nick Smith for being the driving force behind this sensible and practical piece of legislation. I am sure that the rest of my colleagues on this side of the Chamber join me in congratulating the Minister on sponsoring such a great and practical bill.I live down the road from a small place called Ōtira. Back in the day Ōtira grew into a tent city as workmen inhabited it to work on the Ōtira Tunnel. In that tent city the women and children grew and worked and survived in canvas houses and some of them who were lucky enough had wooden floors. So we have come a long way since those days and the standards have improved over time and continue to improve. This legislation will provide yet another way for us to improve the living standards of those people who depend on rental properties—I am talking about 450000 New Zealanders who live in those rental accommodations. This legislation is going to ensure that they are warmer drier and safer.Currently the Residential Tenancies Act requires landlords to keep their properties in a reasonable state of cleanliness and repair and they must comply with a variety of standards. These include meeting the standards in terms of ventilation cooking facilities heating and so forth. Today I would like to talk about smoke alarms. That has been a great topic of conversation today. It is one of the key objectives of this Residential Tenancies Amendment Bill and it is designed to reduce fire-related fatalities and injuries in residential rental properties. As the Minister has noted already today the highest incidence of those fatalities and injuries is in rental properties. Smoke alarms will be a requirement as of 1 July this year.Insulation will be installed progressively over the next 3 years and landlords will be required to disclose the extent of insulation in tenancy agreements. This offers openness and transparency to tenants as they enter into tenancy agreements. However social housing landlords who receive income-related rent subsidies must install floor and ceiling insulation from the commencement date of this bill which is 1 July. These measures as we have heard from the Hon Nick Smith today will save 129 lives a year.I would like to go on to talk about some of the main changes that were made at the select committee stage. The Residential Tenancies Act will now have a higher maximum payment for two unlawful acts in order to help address the natural power imbalance between tenants and landlords. The maximum amount payable by a landlord to a tenant in the form of damages for failing to comply with regulations about smoke alarms or insulation has been increased from $3000 to $4000. This is an encouragement to landlords to ensure that they comply with this potentially lifesaving requirement.The other issue that came up at the select committee relates to retaliatory notices. We heard that some tenants are reluctant to bring complaints against their landlords for fear of eviction. We also heard that some tenants found the 14-day time requirement to appeal too short and were submitting too late. This time requirement has been extended from 14 to 28 days. The maximum penalty for a landlord who does give a retaliatory notice is going up to $4000.A third change that was made in the select committee process was to forbid and prohibit cash payments in return for work that was required on rental properties. A fourth change was giving landlords a specific right of entry for installation of smoke alarms and insulation which brings it in line with repairs and maintenance. Thank you.KRIS FAAFOI (Labour—Mana): Thank you very much. You did have a choice so thank you very much Mr Chair. I do want to take the opportunity to respond to a number of the submissions made across the Chamber to clause 38 around insulation. The last speaker to make a contribution Maureen Pugh said that the Residential Tenancies Amendment Bill was “practical”. Unfortunately for that speaker that is not what the Children’s Commissioner thinks. He said in his submission to the Social Services Committee rather bluntly that in his view “this Bill will not achieve improvements in the quality of rental housing and will not reduce the numbers of children becoming ill from living in cold and damp housing.”I think the Children’s Commissioner might know a thing or two about keeping children safe and healthy. Although this Government may think that the bill is practical the Children’s Commissioner disagrees with the Government saying that it will not make any difference to reduce the numbers of children becoming ill from living in cold and damp housing—something that I think the people of New Zealand should take into consideration when they think about being practical and keeping children safe and healthy in cold and damp houses.Also in relation to clause 38 another one of the Government’s speakers said that based on evidence having a heater in an insulated home will make no difference at all—again something that the Children’s Commissioner at the select committee disagreed with. He said: “… I would have expected to see the following elements included in the Bill: 1. A heating standard for all properties not just those in which insulation cannot be practically installed. The health benefits of insulation come from the combination of insulation and efficient space heating producing a warm dry living environment. It is well known that children especially very young children suffer significant adverse health impacts from living in unheated environments;”. I think again that the Children’s Commissioner might know a thing or two about the effect that heating may have on the health of children.Also if we are going to look at evidence research by the University of Otago showed that insulating to the 2008 standard would reduce child hospital admissions by 6 percent around 3000 children each year. In rental properties this reduction would be about 19 percent. So in terms of evidence and practicality it seems the evidence is on the side of the Children’s Commissioner and the practicality is only on the side of the Government which is doing nothing in this piece of legislation to improve the lives of children living in damp and cold homes.If Government members are going to stand up in this Parliament and say that based on evidence a heater will not make any difference to the lives of children and families living in insulated homes I have got a challenge for them: take the heaters out of your houses and see how winter goes for you. See how winter goes for you because that is the reality for many of the people families and children whose lives we are trying to make better here. So if we are going to look at being evidence based go and live in your insulated—I am assuming—houses without a heater for winter and see how winter goes for you.DAVID SHEARER (Labour—Mt Albert): I want to pick up exactly where my colleague Kris Faafoi left off because he is absolutely right. Just think about what it would be like to live in a home that may be insulated but without a heater. It does not make it any warmer and that is exactly the point that we are trying to make in the Labour Party and the Greens—frankly everybody except the National Government—in trying to promote and get through a bill that will actually make a real difference.If you look at the statistics and you look at what this bill could potentially do for children—but does not—it could reduce the number of kids being admitted into hospital by about 6 percent and by Otago University’s figures that would be 3000 children a year. That is a very conservative estimate; there are others who believe that it could in fact be much more. Just think: 3000 kids who will not need to go to hospital with rheumatic fever with respiratory conditions with colds—with problems that will get so serious that they need to be admitted. Think of the savings to the taxpayer on our health bill if 3000 children no longer need to go to hospital. There is an overwhelming benefit to New Zealand in this bill being done properly. It is an overwhelming benefit because it costs the Government effectively nothing. I cannot think of a policy change that we could look at right now that we could implement that would have such dramatic impacts on the very people that we want to help most who are the people who are living in poverty and living in rental accommodation. Another statistic—if you can keep this in your head—70 percent of kids who are in poverty are in rental accommodation. So we are addressing the issues affecting most those children who are living in poverty and in the worst conditions. Think of another policy that would be able to target them and have that dramatic effect as quickly.My surprise is that I think this was brought up in 2013 and here we are debating it in 2016. I am thinking: 3 years? That was 9000 hospital admissions ago. We have 16 children dying every year from poverty and housing-related issues. Just imagine—some of those kids might well have been here as a result of this. Three years at 3000 hospital admissions. Think of the cost in dollar terms. Think of the cost in social terms. Think of the cost to those families of having to take their kids to hospitals because of not meeting the basic requirement of having a warm dry house. Many of my colleagues have already spoken about this and the fact that New Zealand is well behind in terms of the housing quality that we have here in New Zealand. This is an Act that has needed to be addressed for some time. I do not know why it has not been addressed more urgently.Here are the three things that we in particular want to be able to see. We want to be able to see that when these houses are brought up to spec—when they are insulated and they are warm and dry—they are monitored by the local council and there is an enforcement policy. I know—certainly from people who are coming into my electorate and talking to me about their housing issues—that many of them are too scared to complain to their landlords because they think their landlords will kick them out. In Auckland where there is a real housing crisis—how anybody could not call it a crisis I do not know; it is a severe crisis—they are scared about complaining to their landlords. So we need an independent arbiter making sure that those houses are monitored and enforced. We need to heat cold houses for God’s sake. It is all very well putting insulation and everything else in it but we need to have a heating source so that those kids stay warm. And we need to make sure that the insulation is up to date—that we have 2008 insulation standards and not insulation standards that are 20 or 30 years old. When I mentioned at the beginning of my contribution this evening being able to save—SARAH DOWIE (National—Invercargill): I move That the question be now put.Motion agreed to.The question was put that the amendments set out on Supplementary Order Paper 177 in the name of the Hon Dr Nick Smith to Part 1 be agreed to.Amendments agreed to.The question was put that the amendments set out on Supplementary Order Paper 172 in the name of Metiria Turei to Part 1 be agreed to.A party vote was called for on the question That the amendments be agreed to.Ayes 60New Zealand Labour 32; Green Party 14; New Zealand First 12; Māori Party 2.Noes 61New Zealand National 59; ACT New Zealand 1; United Future 1.Amendments not agreed to.Part 1 as amended agreed to.Part 2 agreed to.Schedule agreed to.Clause 1 agreed to.Clause 2 agreed to.Clause 3 agreed to.Bill to be reported with amendment presently.