Robertson Grant: Taxation (KiwiSaver HomeStart and Remedial Matters) Bill — First ReadingText is incorporated into the Bound VolumeRobertson Grant: Taxation (KiwiSaver HomeStart and Remedial Matters) Bill — First Reading[Sitting date: 04 December 2014. Volume:702;Page:1182. Text is incorporated into the Bound Volume.]GRANT ROBERTSON (Labour—Wellington Central):I think he is the “member for problems” I will certainly give him that—Nick Smith the Minister who has just sat down.In a Government that is increasingly in disarray we have reached peak chaos when it comes to housing because that is what has happened on that side of the House. No matter how much Nick Smith can get up and bluster away about what he thinks he has done every other commentator in New Zealand recognises that this Government’s housing policy is a failure. Every other commentator recognises that except for Nick Smith. It is all very well to come to the House with this bill which is a meek and pathetic and pitiful attempt to do something about housing but to actually address housing the Government needs to think about actually addressing both sides of the housing equation.There are some members on the other side of the House who perhaps have been a little surprised at my becoming the finance spokesperson but here is a message for those members. It is a pretty basic one: if a market is going to work you have supply and demand. And unfortunately when it comes to the National Government it thinks it can put up demand measures and not address supply. As Phil Twyford said at the start of this—Hon Dr Nick Smith: We’re building record numbers of houses.GRANT ROBERTSON: Nick Smith says National is building record numbers of houses. Dr Smith you are not. You are not building record numbers of houses; you are building half the number of houses that Labour was building at the peak of its time in office. The fact is that if Dr Smith wants to compare the building of houses during the global financial crisis with the building of houses today well he can come up with his mythical statistic of doubling the number of builds but in reality there has been a complete failure by the Government to build houses. Dr Smith himself has admitted it. We have got an 18000-home gap that has been built up in terms of what is needed in Auckland. You need to be building 13000 homes a year just to stand still and we have an 18000-home gap built up. There is a crisis Dr Smith and it does not matter how often you want to walk away from it.Housing is now completely unaffordable for a large number of New Zealanders and the kind of tinkering measure that is present in this bill does very very little to address those issues. You know New Zealanders for many generations have thought that owning a house was the kind of thing that was part of life that when you got a good job and you were well-paid you would be able to own a home. Well unfortunately at the moment it costs 63.1 percent of one median income to pay the mortgage on a median-priced house. That is up from 55 percent just 5 years ago. If you are in Auckland it costs 88 percent—Hon David Parker: 88?GRANT ROBERTSON: —88 percent—of one median income to pay the mortgage on a median-priced house up from 70.4 percent 5 years ago. It is up 18 percent in just those 5 years. So coming up with a scheme that might give somebody an extra couple of thousand dollars or that gives a couple maybe an extra $5000—Hon Dr Nick Smith: $10000.GRANT ROBERTSON: —does not bridge the gap Dr Smith. It does not do it. This is a pitiful response.When you take the average price of a house in Auckland it is $748955. That is up by 3.1 percent in just the last 3 months. As Andrew Little said the other day the average house price in Auckland earned more in the last year than the average worker did. It is out of control and all the Government can do is come along and tinker and add on to the KiwiSaver policy in a way that is in fact greatly exaggerated.I do want to pick up something that Nick Smith has just said. He has claimed that the additional number of people benefiting from this proposal is 90000 people. An impressive-sounding number Dr Smith except for the fact that 50000 of them were going to get that benefit anyway. No change—50000—Hon Dr Nick Smith: No only when that changed last year.GRANT ROBERTSON: No that is what Treasury has said: 50000 of those people were already going to get it. So actually the number that is claimed is around 41000 except the chaos of this policy continues because when National tries to work out its costings it says that it is going to cost $218 million but that is for the 41000. So if it is 90000 Dr Smith then the cost would actually be $435 million. So the Government cannot even get its numbers straight on this policy let alone know whether or not it will actually have any great impact.It is quite clear as Phil Twyford has already said that if demand is going to increase in a supply-constrained environment this policy is not going to work.Hon Dr Nick Smith: Grow supply.GRANT ROBERTSON: Oh “Grow supply.” Dr Smith says. That is exactly the point. How many houses has the Government built? The great housing accord has built five houses.Hon Dr Nick Smith: 24000.GRANT ROBERTSON: He is now claiming it is 24000—plucking a number completely out of the air. It is interesting that the UK Conservative Government has actually come out in just the last few days and said—and this is the exact quote from Danny Alexander—to the private sector: “If you don’t build houses we will.” That is what the UK Government is now saying because as a Conservative-led Government it recognises that actually—Hon David Parker: A Labour policy from New Zealand.GRANT ROBERTSON: Yes. It has had a look at KiwiBuild. It will be called “Corgi-Build” or something of that nature that goes on in the UK. It has recognised the need to make sure that the State is actually there when the market is failing. That is Dr Smith’s problem. He is not prepared to use the fact that the Government can build these houses.KiwiBuild was a popular policy and some of the backbench members over there were shouting out about 25 percent. The reality is that you can look at any survey of that policy. New Zealanders understand that if we are going to ensure that people have the ability to buy an affordable home there needs to be direct intervention from the Government to do so but this Government is not prepared to do that. It only wants to sit back and try to let a market that has already failed fail even more and that is the situation we find ourselves in today when we look at this bill that is in front of us here.We have a situation in New Zealand where homeownership rates are the worst that they have been in 60 years. We have a situation where housing costs are outstripping and growing faster by far than income and it is getting worse under the watch of this Government. Everything that this Government touches with housing is too little and too late and that is what we see in this bill.Nick Smith raised the question of why something is wrong when Labour brought it in as a subsidy scheme and he asked why it is now wrong to extend it. The problem is the situation of supply. If Dr Smith cannot come forward to this House with realistic initiatives that will create more than just a handful of houses around Auckland—Hon Dr Nick Smith: 24000.GRANT ROBERTSON: He keeps claiming it is 24000. That is not what the Government created. That was happening anyway. The big new initiative has resulted in five houses with the massive number of 18 predicted by the end of the year. There is going to be a spurt in the last couple of months and he will get himself to 18 houses. It is pathetic.So in terms of this particular bill the Labour Party looks at it like this: if the Government really wanted to ensure that it was supporting first-home buyers it would focus on the building of affordable homes. By saying in this particular proposal that they want to focus on new builds there somehow is a belief in the Government that new builds will be in the affordable housing area. Well the evidence out there is that that simply is not true and is not credible because for developers the money is not made in the affordable housing sector. We know that—that is the history of what has happened over the last few years. That is why we do not have affordable homes. So simply saying in a blanket way that because there are new builds it will somehow translate to affordable homes is not accurate. If the Government wants affordable homes built take the lesson from what is happening in the UK and get in there and muck in and help out in the sector instead of standing back and trying to use instruments that are actually not going to work. This may well benefit one or two people. Well that is good to a small extent.Hon Dr Nick Smith: 90000.GRANT ROBERTSON: It is not 90000 Dr Smith—we have established that. If it is 41000 you will be lucky. The problem is that whichever number it is it is a drop in the bucket. What is needed is housing policy that addresses supply and demand and supply in terms of affordable housing. That will happen only if the Government plays a more active role. If it carries on the way it is going the crisis will deepen and more and more young New Zealanders will miss out on the opportunity of buying their own home.