Logie Jan: Taxation (KiwiSaver HomeStart and Remedial Matters) Bill — Third ReadingText is incorporated into the Bound VolumeLogie Jan: Taxation (KiwiSaver HomeStart and Remedial Matters) Bill — Third Reading[Sitting date: 26 March 2015. Volume:704;Page:2674. Text is incorporated into the Bound Volume.]JAN LOGIE (Green): I rise to speak on the third reading of the Taxation (KiwiSaver HomeStart and Remedial Matters) Bill which the Green Party is supporting. We are supporting it because it might just be better than nothing. We are not quite sure but we are taking the chance that it might just be.Most reasonable-thinking New Zealanders recognise that we have a bit of a problem with housing affordability and quality and tenure in New Zealand. Many in fact call it a crisis. I have had concerns about this crisis raised with me personally everywhere from Invercargill to Whangarei. I happen to have heard some stories around Northland about concerns with housing as well. Of course we most often hear about the problems in Auckland and Christchurch.There is a crisis. In 1970 the average age for first-home purchase in New Zealand was just 25. In 2013 it is estimated to be either 34 or 36 years of age. We now have the lowest rates of homeownership in New Zealand since 1951 with more than 35 percent of people in this country renting. The median house price is over $380000 and significantly it is almost double that in Auckland. Yet the median family can afford to service a mortgage of only $250000 to $300000 and they are likely to have only a few thousand dollars in the bank. It is estimated that only 5 percent of the new builds the few of them that we have been hearing about are now affordable. This is compared with 35 percent of all new builds in 1960 being affordable houses. The average cost of a house in Auckland is now $621800 and the rate of housing inflation in Auckland is $1700 a week. To meet the loan-to-value ratio requirement of 20 percent deposit it is around $120000. It makes it unaffordable for many who would previously have bought a house only a few decades ago.Increasingly families are spending their lives paying someone else’s mortgage spending their money towards somebody else’s accrual of wealth. We know that the answer from this Government will do nothing to help this. It will do nothing to improve people’s ability to pay off their mortgage. It will do nothing to help people who cannot afford KiwiSaver contributions in the first place. It will not help housing affordability—in fact the views of some are that it will make it worse. It will not help people save for retirement.Hon Member: What’s your plan?JAN LOGIE: I will get to our plan. Treasury suggests that it will just enable people who are already likely to be able to buy to do it a bit quicker. It risks increasing demand in a supply-constrained market.We have heard huge amounts of hyperbole from this Government about how seriously it is taking this housing problem even though its Ministers cannot quite bring themselves to suggest it is a crisis—though I have heard perhaps more in-touch backbenchers from that side of the House acknowledge that it may be a crisis. I would just like to take this opportunity to contrast the Government’s policies that are contained within this bill which will allow people to use the $521 a year of tax credits in their KiwiSaver account towards a first-home deposit with our policy of progressive homeownership and to let the speaker and the public decide which policy would be more effective at addressing the housing crisis and low rates of homeownership.The Green Party recognises the housing crisis. Housing is central to our vision of a fair sustainable and prosperous society. Safe and securable sustainable housing is fundamental to the health and well-being of families and communities and our economy. All New Zealanders have a right to warm safe stable and healthy homes.We have a comprehensive policy to address all of those concerns but today I would specifically like to contrast the policy contained in this bill with our Progressive Ownership policy. Our Progressive Ownership programme will provide a pathway to homeownership for families who do not have a deposit or the income for a commercial mortgage. It will work by the Crown ideally along with partners in local government iwi and the community sector building affordable homes worth say around $300000 on average. We do understand that although land prices might be high the possibility of intensification enables us to leverage off that and bring the cost down. It would build to modern environmental standards and make efficient use of land with modern urban form well served by public transport. We have read the research that shows that building out on the fringes not connected to public transport has the highest rates of mortgagee sales because as petrol prices go up people become more vulnerable and cannot pay off their mortgages any more. So under our policy people could build healthy communities and cheaply and easily get around.Families will enter into contracts with the Crown for these houses. Under these agreements the Crown will initially own all the equity in the house. Families will pay a basic payment to cover the Crown’s cost of capital—say $200 a week on a $300000 house at the Government bond rate of 3.5 percent. Our Government has access to cheap loans in a way that the average individual through a bank does not. Then the people who are buying into the houses would be able to make additional variable purchases of equity in the property from the Crown at the value of the house when the agreement was signed. Basically that is just saying that when you have got a bit more money you pay a bit more and then you start to increase ownership of that house until you own it. The Government is no worse off. It has the money that it first invested into that house to put into another house to enable another family to purchase their own house. If that family starts to struggle and cannot meet those rates of repayment then it just pulls it back down to the $200 a week to cover the Crown’s capital investment.This policy recognises the reality of struggle for so many of our families and provides a solution whereby families can start to accrue wealth. If their situation starts to improve then they can actually take out the equity they have in that house and use it towards a more expensive house say in the private market. The Government is no worse off the Crown has the same investment that it had to begin with and that family is able to move ahead at their own pace. They are no longer feeding the wealth of the increasingly small number of investors who own an increasing number of the properties in this country.I really ask this House to consider the extra $521 a year that this bill which is in front of the House at the moment would provide to people who already have the money to put into KiwiSaver to be able to save for that first-home deposit. What will that really do to help people get into housing in Auckland or in other parts of the country where people are struggling compared with using the resources that we have as a State to build and help people pay off houses at a rate they can manage and that meets the fact that their situation may change? I really think that to put it bluntly it is a no-brainer. Nobody loses in this option and what we gain as a country is strong secure communities where children are able to go to the same school and improve their learning and we are all much better off. Sadly this bill does nothing.