Housing Accords and Special Housing Areas Bill — Third ReadingText is incorporated into the Bound VolumeHousing Accords and Special Housing Areas Bill — Third Reading[Sitting date: 05 September 2013. Volume:693;Page:13328. Text is incorporated into the Bound Volume.]Housing Accords and Special Housing Areas BillThird ReadingHon Dr NICK SMITH (Minister of Housing): I moveThat the Housing Accords and Special Housing Areas Bill be now read a third time. This bill introduced as part of Budget 2013 is about enabling tens of thousands of homes to be built. It is about helping Kiwi families to realise the dream of owning their own home. It is about supporting the Government’s economic recovery plan by reducing the financial risks of Auckland’s house price bubble. It is about employment and freeing up land so that builders plumbers electricians drainlayers plasterers and painters can get on and construct the homes that cities like Auckland so desperately need.This bill is based on sound research. We have had the Productivity Commission we have had the Reserve Bank and we have had the OECD and the IMF and every substantive report on housing highlights the need for additional supply. Let me highlight the problem. Auckland has got just 1300 sections currently available for housing. That is a third of what it had a decade ago. We need 13000 sections each year just to keep up with population growth. We have got a rigid metropolitan urban limit prohibiting any new housing development beyond the artificial line drawn 15 years ago. We have got a few lucky landowners sitting on the last few parcels of developable residential land holding prospective homebuyers to ransom.Section prices have trebled and have gone up by more than any other part of the housing cost equation. We have got a convoluted Resource Management Act planning system where it takes an average of 7 years to get a plan changed by the time you get through all the consultation and appeal processes. Even when you have got a plan changed it takes an average of another 3 years to get resource consent for a greenfield development and a year for a brownfield development.We have got a constipated planning system bogging new residential construction and this bill is a laxative to get new houses flowing. It will enable plan changes and resource consents to be approved simultaneously. It overrides Auckland’s metropolitan urban limit freeing up thousands of hectares of land for housing. It fast tracks theconsents process enabling greenfield developments to be approved in 6 months and brownfield developments to be approved in 3 months. It makes plain that the Government’s strong preference is to get this work done in partnership with councils through housing accords but it also provides that the Government can get on with the job if councils stand in the way of delivering an increased supply of affordable housing.We have secured the first housing accord with Auckland. In essence it enables the 39000 least contentious homes of the 400000 homes proposed in Auckland’s 30-year plan to be built over the next 3 years. The alternative is that we sit and wait for 3 years before we enable any new residential development. That would be a disaster for Auckland and an even bigger disaster for New Zealand. We are also progressing discussions with other councils with high housing costs to use the tools in this bill to facilitate more affordable housing.The Government has made plain that this new law is just part of a comprehensive plan to address the challenges of housing supply and affordability. We have announced changes to infrastructure costs with a further bill to be introduced later this year. We have announced the next phase of Resource Management Act reforms which will simplify the planning process and require councils to plan for 10 years of residential housing supply. We have got the building materials cost inquiry reporting shortly to Ministers from which will flow significant new initiatives. We have got the work on streamlining building consenting and the new online consenting system.We have lifted our investment in apprenticeships. We have trebled the number of Welcome Home Loans. We have announced the expansion of the KiwiSaver first-home deposit subsidy scheme. We have got dozens of projects under way where the Government is directly facilitating new housing developments like at Hobsonville Rangers Park in ChristchurchTāmaki Papakura and Weymouth. This Government is directly building more houses than any Government in more than a generation. This bill is a critical part of that programme.I must put on record the incredibly shallow response from Labour members which shows that they have been far more interested in playing politics than helping Kiwi families secure an affordable home. They first described this bill as Draconian and going too far. Next minute they say it is tinkering and does not go far enough. They demanded urgent action then opposed urgency to get this bill progressed and filibustered at every opportunity to try to slow it down.They demanded that we secure agreement with the Auckland Council. In fact they put my picture up all over Auckland demanding that we get agreement. Then when we get agreement they oppose the accord and try to do everything to unravel the agreement. Then we have their housing spokesperson saying earlier in the year that it would be very useful for the Reserve Bank to put limits on low-deposit loans. Then when the Reserve Bank does that he attacks it and opposes the measure.During the Committee stage there was this poignant moment when Mr Twyford claimed that the bill had no specific mention of affordable housing. When challenged he admitted that he had not actually read the bill. It reminded me of that snapper moment with David Shearer. I suspect that Labour will soon have a new housing spokesperson along with its new leader.Even more worrying is the Opposition’s intellectual bankruptcy on the core issues affecting housing affordability. Mr Twyford is on record as saying in June that land supply is not the issue. He described the Productivity Commission’s report on housing as the work of dinosaurs. Even more concerning was the contribution from Labour’s environment spokesperson Maryan Street who during the Committee stage said that Labour opposed reform of the Resource Management Act and saw absolutely nothingwrong with it taking 3 years to get a consent for new residential development. That shows that Labour is part of the problem not part of the solution.Labour has repeatedly criticised this bill because it does not guarantee houses at a particular price for Kiwi families. It just shows the degree to which Labour is off in la-la land. Labour members somehow believe that all we need to do to get New Zealanders an affordable house is pass a bill through this House and say that such and such a price shall be the price of a home and it will magically happen. It is about as daft as the idea from two of the Labour Party leadership hopefuls who say that all we need to do to lift incomes in New Zealand is pass a bill through Parliament requiring a liveable wage of $18.40 an hour or their electricity policy that has the Government just setting the price and somehow that will work. It shows a complete ignorance of how a modern economy works.Our job is to make the market work for people and for our country. The truth is that there are dozens of landowners and builders ready and waiting to get on and build the houses New Zealand needs before we contemplate the Government building all the houses we need. We need to remove the barriers and let our Kiwi entrepreneurs and innovators get on with the job.There has been a power of work go into this bill. I want to acknowledge the team at the Ministry of Business Innovation and Employment; the team at the Parliamentary Counsel Office; and Sam Lotu-Iiga particularly and the very competent and focused Government team on the Social Services Committee—all of whom worked under very tight time pressure to deliver this new law.The next step after the passage of this bill will be Auckland Council’s adoption of its housing accord next Tuesday and the notification of its unitary plan. This law will then take effect the following Monday. My ambition is to have sufficient special housing areas approved for at least an additional 5000 homes by Christmas. That is what it is all about—getting on and building the homes that Kiwi families need. I commend the bill to the House.PHIL TWYFORD (Labour—TeAtatū): In beginning this speech I want to note just how reliant members of Parliament are on the many staff who support us in this Parliament. One such staff member is Sarah Austen-Smith who works in the Labour media team and who has supported me on housing issues on a number of occasions. She is about to leave us shortly and I want to thank Sarah for her work but also thank all of the staff in this institution who make it run.I want to say first that there is nothing wrong in principle with a bill that sets up special housing areas with a bill that makes new greenfield land available or a bill that fast tracks consenting. There is a housing crisis in this country largely because of the economic settings that this Government has refused to change over the last 5 years. The crisis is taking the Kiwi dream of homeownership further and further out of reach for a whole generation of young New Zealanders. It requires bold action but this Housing Accords and Special Housing Areas Bill is not it.This bill is the centrepiece of the Government’s housing policy and in spite of the claims made by the Minister of Housing in his earlier address it falls well short of what New Zealanders want and expect from their Government in tackling the housing crisis. This Government refuses to crack down on speculators. It refuses to consider the advocacy of almost every mainstream economist in this country who says that a capital gains tax should be implemented in order to take the speculative steam out of the housing market. It refuses to stand by Kiwi first-home buyers and do something about the offshore speculators who outbid young New Zealand first-home buyers at property auctions daily. It has no concern that real estate companies are actively marketing New Zealand houses in places like Hong Kong and Singapore as some kind of happy huntingground for property speculators with no capital gains tax no stamp duty and no restrictions on foreign ownership.Even worse still National refuses to roll up its sleeves and actually build affordable houses. For some reason it is allergic to the notion that a Government in a housing crisis like this should actually build affordable houses and in spite of the Fairfax poll a few days ago that showed that 73 percent of New Zealanders support the policy of the Government actually building affordable houses. Instead it prefers to tinker with the Resource Management Act and blame councils for the worst housing crisis this country has seen in a generation.The final piece of the picture that is the essential context for this bill is the agreement negotiated in May between the Reserve Bank and the Government on the introduction of macro-prudential tools that would give the Reserve Bank more tools to deal with monetary policy and particularly loan-to-value ratio lending limits. The Government bungled it it panicked and now first-home buyers are being shafted by this policy which has the effect of locking out 80 percent of first-home buyers who cannot get a 20 percent deposit together. First-home buyers are now being affected by interest rates going up. In fact everyone who borrows money is now being affected by interest rates going up. All four of the major banks have put up their rates citing the effect of loan-to-value ratio lending limits. Bank charges have gone up specifically for low-deposit borrowers and the banks are charging a premium. All four banks are charging a premium to low-deposit borrowers because of the Government’s failure to negotiate even a temporary exemption for first-home buyers from the loan-to-value lending limits. A generation is being locked out of the Kiwi dream of homeownership.We voted for this bill at its first reading during the Budget debate because we took the view that the housing crisis is so severe it is having such a terrible impact on New Zealand families and we felt that if the Auckland Council and the Government had spent 6 weeks trying to negotiate an accord it was worth giving serious scrutiny to at the Social Services Committee. But we will not vote for it now. It is weak. We have no confidence that it will result in any affordable housing being built and submitter after submitter came to the select committee and said that. We have no confidence that it will even make housing any more affordable in general. It is based on a kind of trickle-down theory of housing that if you build more houses no matter how expensive they are somehow that is going to make houses more affordable. Mr Banks is shaking his head but I ask him this: if you import moreMaseratis into New Zealand will that make the Corolla more affordable? It is a fairytale of economics there is no justification for it and we will not go along with it. The Minister explained to the select committee under questioning that if you build a whole lot of $800000 houses then some people are going to sell their houses possibly cheaper ones to move into the $800000 ones and that is how this bill will make housing more affordable. It is trickle-down housing economics and nothing more.I want to note in response to the Minister’s comments that he rushed a swag of amendments to the House an hour or two before the Committee stage of this bill. Supplementary Order Paper 351 amended 57 of the bill’s 89 clauses. He did not see fit to bring those amendments to the select committee. He tabled them on the floor of the House only an hour or two before the Committee stage. That is sadly symptomatic of the rushed ad hoc approach we have come to expect from this Minister. At least I suppose the Government has bowed to pressure and all the comments made by submitters who came to the select committee and complained that the bill contained no serious mechanism to deliver affordable housing. The amendments give the Minister by Order in Council the power to regulate for a share of affordable housing in any qualifying developments. But he declined to put the actual mechanism into law. Hecovered the bill’s inadequacy with only a fig leaf of a power to regulate. Frankly on this Government’s record that gives us no confidence whatsoever that he will use this power. One of the first things this Government did when it came to power in 2008 was it repealed Maryan Street’s law that gave councils the power to practiseinclusionary zoning to require a share of affordable housing in new developments the very thing that should be in this bill—the very thing that should be in this bill. Nick Smith in 2008 voted to repeal the law that would have done that and now he has brought to this House a diluted weak watered-down version of the same thing.This Government stripped the Hobsonville development of State housing and under pressure from Labour the best it could do was reinsert a watered-down promise to build some small number of so-called affordable houses costing more than half a million dollars—affordable to very very few Aucklanders. That Minister and others like the Hon Bill English are on record all over the place as rejecting the notion ofinclusionary zoning rejecting the very notion of requiring developers to build a share of affordable housing. That is why we have no confidence in that Minister’s provisions.There are several other defects I want to just note in closing. This bill weakens quality controls. It undermines environmental standards. Is it any wonder that Aucklanders are alarmed by Nick Smith’s comments in theNew Zealand Herald that Aucklanders had better get used to lower-quality housing developments? That is a major concern. Secondly the override clauses in this bill are undemocratic. They are part of a trend under this Government of stripping away the powers of communities and local government and constantly centralising power to the executive. It is a mockery of the whole notion of an accord that this bill gives the Government the power to do whatever it wants regardless of what a council wants to see. How can a council negotiate a housing accord in good faith with a gun held to its head in that way?The bill also undermines the protections given to special areas like the Waitakere Ranges under the Waitakere Ranges Heritage Area Act. That Act currently has primacy over other laws and regional and district plans but this bill requires only that decisions made in relation to special housing areas give consideration to that Act. Is it any wonder that people in west Auckland are worried about housing developments in the Waitakere Ranges? Labour will not support this bill.MELISSA LEE (National):Ahnnyung ha seyo. It is a great pleasure to rise in support of the Housing Accords and Special Housing Areas Bill at its third reading. I would like to take this opportunity to congratulate the Minister of Housing the Hon Nick Smith and acknowledge all of the officials submitters Social Services Committee clerks and members of the committee right across the House who have spent many hours considering this bill.We may not necessarily all agree but in my view this bill will make a great deal of difference and I look forward to the changes that it will bring. If we actually take what the Minister has said we see that he hopes there will be 5000 new homes consented. That is a heck of a lot more than the 3600 a year that are currently consented when there are only 1300 sections available and there are 13000 homes a year that are required to be built to keep up with the population growth.Over the course of the passage of this bill members have traversed their views widely. One that had particular resonance with me was the issue members have raised regarding housing affordability and how different our views were. Members have heard my views on why I believe that the Opposition’s idea to build 100000 homes for under $300000 in 10 years is complete hogwash. Can I remind members that if an average section price in Auckland is $325000 how will the Opposition build homes under $300000? I say to members opposite that they should sack whoever did their sums for them.I do not possess a brilliant mathematical mind—I know; most Asian people are brilliant at maths—but even I can figure out that when the average section price is $325000 Opposition members’ promises to deliver affordable homes under $300000 are nothing but lies. I am guessing that land was not actually included in their calculations. If so if they believe that they can build homes for under $300000 and they consider that affordable I say they have got rocks in their heads. We know that we can build houses for half that price—and the Starter Home Design Competition proved that—but it is the land where the houses sit that pumps up the price of homes. They go together actually—houses on land become homes for people.I was also consistently dismayed at members opposite who seem to think that first-home buyers buy brand new homes and at the median price. How many members in this House of Representatives can say that their very first home was a brand new house and it was their dream home? Most people start very very small. They start with a small home that they can afford to buy and then they move to grow with their growing family. They never start with their dream home.This Housing Accords and Special Housing Areas Bill provides for a special housing area under accords between the Government and councils. What happens in special housing areas is that the councils can fast track planning and consenting processes. At the moment the average for greenfield development consents is 3 years while brownfield consents take about a year. With this bill the council can consent greenfield developments within 6 months and brownfield developments within 3 months.The first accord—the Auckland Housing Accord—sets a target of 39000 new homes consented over 3 years. This is a far greater number than the 3600 homes currently being consented a year. This accord is a great example of how the Government can work collaboratively with councils to make housing affordable. The Productivity Commission the IMF and the Reserve Bank all identified that land supply was one of the key factors in making housing affordable. Unlike the Opposition members who cannot even do sums—you cannot pay $300000 for a home when you pay $325000 for land for that home—it is a view of this Government that when five key areas are targeted we will improve and achieve affordability of the homes that Kiwis dream of. These five key areas are land supply material costs infrastructure productivity in the construction sector and compliance costs. Everyone seems to get this apart from the Opposition it seems.Labour also had another solution to housing—a xenophobic solution. It was to ban foreign buyers. Actually Labour members did not mean all foreigners. They did not say boo about Shania Twain buying a farm. They never said anything about James Cameron. [Interruption] That is right. They actually mean Asian people. That is who they object to. If Labour were in Government and God forbid that it be in Government and if Labour were to ban foreign buyers if I turned up to an auction to buy a house I would probably be considered a foreigner to be banned from buying and that is exactly what I object to. This kind of xenophobic scaremongering results in Kiwis who are born overseas and in Auckland that is almost half the population being treated like they do not actually belong in this country that we have chosen to call home.Let me state here that a BNZ survey shows that only about 3 to 4 percent of house sales go to foreign buyers.Barfoot and Thompson has also put the number at around 4 percent. If I could put a personal view a personal migrant’s perspective on this most foreign students who study in New Zealand are supported by their parents who often buy homes to house their children. Once their children have stayed in New Zealand for a number of years the natural progression is for their parents to consider moving to New Zealand to be with their children on a more permanent basis. Preventing thesepeople from buying a home will most probably have a major consequence to our international student numbers as well.This is a sensible bill at the right time and if I can see that 5000 homes are consented before Christmas that would be a wonderful thing. I commend this bill to the House.Dr RAJEN PRASAD (Labour):Namaste Mr Assistant Speaker. There was just so much wrong and inaccurate in that last speech by Melissa Lee that it is hard to know where to begin. For example the member said that no first-home buyer in New Zealand ever starts with a new house. Well I did—I did. It was a long time ago I say to Melissa Lee. It was the norm. It was the norm when we were just starting off in our first jobs to go out and buy group housing for three times our salary. That was the norm in those days. Things have changed I know but to say that that never happened is not true.Then the member said that the Labour Party policy on overseas buyers—The ASSISTANT SPEAKER (H V Ross Robertson): Order! I am sorry to interrupt the honourable member but I have a debate going on in the Chamber between two members on one side of the House and one on the other. It is not permitted. If you want to interject then there is a speaker addressing Parliament and that is where it should be directed to. Interjections between members who do not have the floor are not permitted. Sorry Dr Prasad.Dr RAJEN PRASAD: Thank you Mr Assistant Speaker. If the member Melissa Lee is going to cite the policy of this side of the House then I ask her to cite it accurately. Anybody who has a permit to be in New Zealand to migrate to New Zealand or who lives here has no restrictions on buying a place whether they are black brown or brindle. It does not matter where they come from. The bit that we object to is the overseas people who are simply speculating on the New Zealand market and driving—Melissa Lee: How can you tell the difference?Dr RAJEN PRASAD: If the member just zips it for a minute I will tell her how. Zip it and I will tell you how Melissa Lee. None of those contracts would be approved if the lawyers could not guarantee that those people qualified—none of them. It would not happen I say to Melissa Lee. So before calling this side of the House xenophobic I ask that member to interrogate her own sense of understanding of policy.The third point that that member makes in a really insulting way is about the bean counters on this side of the House.Melissa Lee: What have you got against AsiansRaj? You’re an Asian.Dr RAJEN PRASAD: I ask the member to listen—please listen. The member might learn something. That member and many other members on that side have said repeatedly that this side of the House does not know how to do arithmetic. If a piece of land costs $300000 then that member says that it is not possible to build a house and land package for $300000. That member is making one fatal assumption—Hon John Banks: What?Dr RAJEN PRASAD: —and that is that you can build only one house on one piece of land. John Banks should know better. You can go high. You can have multiple units. How many countries have the members seen this in? The whole plan is about going up using—Hon John Banks: How high?Dr RAJEN PRASAD: Six storeys according to this bill. Six storeys according to this bill. John Banks should read the bill because the member has not. So those are just three points that Melissa Lee makes. You know whenever Melissa Lee speaks in the House she does make so many fatal errors that one could make a whole speech based on just those errors—Melissa Lee: Oh that’s harsh.Dr RAJEN PRASAD: —and insulting Melissa Lee—insulting. Please do not do that. If the member stopped doing that then I would not have to retort in this way because it always happens.This particular bill is based on a theory. The theory is that if we made more land available and we addressed planning procedures this would produce two results: more houses and more affordable houses. That is the theory that this particular bill is about. The mechanism that this bill believes will do that is the market. If indeed the market is left to its own devices it will produce affordable housing. This is believed to be the perfect mechanism by members on that side of the House. Well it is a failed model. The market model does not apply comfortably in the housing area which is why the problems have been created.Hon John Banks: Oh don’t be sillyRaj.Dr RAJEN PRASAD: John Banks should know that it is not being silly. It is a fact. If that member is going to argue for the market model in its entirety then that member is in cuckoo-land. He is in cuckoo-land because you would not need any laws to reduce the market to be civil and work properly. That is why we have rules Mr Banks. The market is not a perfect model. If the market worked then why is housing in such a mess today? It does not work as a perfect model. It will not create affordable housing. It did at the time when I bought my first home—which Melissa Lee knows nothing about—but it does not work now which is why it needs to be fixed. But these provisions will not fix it.There are a whole range of things that need to be brought together to address the housing crisis of New Zealand. This bill brings some of them together I agree. We have acknowledged that. Making more land available is important. But what we argue against—Melissa Lee: Support it.Dr RAJEN PRASAD: It will not work—it will not work—unless all of those other things are also addressed. Some are and some are not—the cost of material access to capital tax treatment of housing speculation and development of the workforce in this particular area to engage in big building. Look at the problems we are having in Christchurch at the moment. The Minister of Housing speaks about how the number of houses that are planned and being built by this Government is so impressive. The bulk of them are in Christchurch. The bulk of them are in Christchurch because they have to be built. They are funded by insurance. There are no other choices. The Government cannot take credit for the earthquake and all of that as well. That just happened to be the case. Any Government would do that.Fundamentally what this side of the House is arguing is that there is a major need for affordable housing and a comprehensive approach would address this.Hon John Banks: Well what is it? What is it?Dr RAJEN PRASAD: Mr Banks it goes like this. What is what?Hon John Banks: What is the comprehensive approach you are proposing this afternoon?Dr RAJEN PRASAD: Well if the member would have been listening the member would know what they are. Clearly the member does not know what they are. All of a sudden this Government has become interested in housing. Up until quite recently it was not.The genesis of this bill really is Labour’sKiwiBuild programme. The Government got a sense that this was really important. The second one Mr Banks—and Mr Banks should know—was Auckland City beginning to look at housing in a different kind ofway and saying: “We have to address this.” All of a sudden the Government realised that it had to do something and this bill was the hurried approach that came out of it.There are some things that are good in this bill but it is not comprehensive. It does not address the whole thing. The Minister said: “We have a comprehensive programme. There are more bills to come.” Well a comprehensive programme brings all of the solutions to a complex problem together and puts a bill up so that we can debate all of them so that we can achieve change. This bill does not do that. What is needed is a bold plan to do that.Hon Maurice Williamson: What is this member actually saying?Dr RAJEN PRASAD: I knew Maurice Williamson would say something. He is an intelligent member. He is a member who knows a lot about this area and he is a member who knows what a comprehensive programme would look like. Mr Williamson knows that this is not a comprehensive programme. Mr Williamson does know a lot more than John Banks does or Melissa Lee does.This Government is disingenuous when it comes to housing. If the Government was really sincere—Tim Macindoe: No no we’re active and on the market.Dr RAJEN PRASAD: I say to my dear friend from Hamilton please do not give me another opportunity to have a go at another one of my friends from the other side of the House.Tim Macindoe: Oh go on.Dr RAJEN PRASAD: The member just did. The member just did. When Hobsonville came up Hobsonville was there—you know the Government takes the credit now. It says: “Look we’re building Hobsonville.” But no the Government is not generous enough to acknowledge that the grunt work for Hobsonville was done by a Labour Government. It was all put in place by a Labour Government. National just happens to be in Government when the time has come for the houses to come on stream. But what was the first thing the Government did? The first thing it did was to make sure there would be no affordable houses there—none. It did not want the average working-class person to go to John Key’s electorate. So what the Government did—and now it regrets it but I wish it would apologise for it. If the Government had allowed Hobsonville as designed to happen it would have produced affordable housing. It would have been a much better programme. But no in its zest to keep people separated or keep the poor where they belong keep the average-wage people in some other place it actually kept them out. Now Hobsonville has got some affordable houses—I think it is seven or eight really small ones. Who is going to live there? Maybe that student whom Melissa Lee was talking about. Here again the programme for affordable housing is not there.The last point I want to make is this. The Minister said in the Committee stage of this bill that affordable housing is now mentioned in the bill. Yes it is. In the amended bill clause 15(2A) does mention it. By Order in Council the Government can do something about this. When we asked the Minister to explain to us in the Committee stage what this meant he did not take one call. He did not want to explain. Something has just been put in there. This is not a bold plan. It will not work. We would have loved to support a housing programme but we will not be supporting this one. Thank you.METIRIA TUREI (Co-Leader—Green):Tēnā koe. Before I begin this contribution on the Housing Accords and Special Housing Areas Bill I want to just acknowledge the passing of Dennis Hansen who has been named as the man who was killed in a car crash yesterday. Koro Hansen is akaumātua of significant standing not just in Auckland and withNgāpuhi but around the country and so we want to just acknowledge his loss and the loss to hiswhānau hishapū and his iwi. Kia ora.Now to the bill. This bill is not about housing affordability. That is not what this bill addresses. It is actually about urban sprawl. It is about undermining the Resource Management Act and about usurping the role of local government in making decisions about housing provision in its local area. I will talk in this contribution about housing affordability and my colleague Eugenie Sage will discuss the Resource Management Act and the local government aspects of it because this is a very serious attack on the right of local councils to make decisions for themselves.There is no doubt that we need legislation to improve the affordability of housing. There is a nationwide housing crisis. My colleague Holly Walker who is responsible for this bill on behalf of the Greens has talked in previous contributions on this bill about the fact that the average house price in Auckland is over $700000. There is a crisis in Christchurch as a result of the lack of housing following the earthquake. The average price of housing across Aotearoa as a whole is well over $400000. It is simply unaffordable for most New Zealanders to purchase their own home. So absolutely housing affordability must be a priority for this Government but this bill clearly shows that housing affordability is not because this bill does not deal with it in any way. This bill identifies housing affordability as a problem but it deals in fact with land supply.Land supply has been a major political issue for this Government but is not actually the major issue when it comes to providing more affordable housing for anyone even in Auckland. It is certainly true that there may be some issues in Auckland but there are also issues with land barons for example—people holding on to land that could be used for housing now but are waiting for it to improve in its value. So there is an element of I think greed in the way that housing has been treated and the way that the Government supports housing being treated by the private market. The Property Council has said that land supply is at most half of the problem around housing affordability and that land supply certainly is an issue that does not affect the rest of the country outside of Auckland to any great extent. To the extent that this bill deals with land supply it is dealing with only a small proportion of the problem in some specific areas not about housing affordability across the country.There is no requirement in this bill for the houses that are to be built to be affordable. There is no legislative provision that makes affordable housing core to this legislation. The Government has acknowledged that that is the case. In fact the only reason that housing affordability is even in parts of the bill as it isis that Auckland Council has required that to be the case as part of the accord. That is great from the council’s point of view but if the Government does not make it a priority for itself it simply will not be a priority for others elsewhere. The Minister of Housing has also confessed to the Social Services Committee that this bill will not increase the numbers of affordable houses for New Zealanders to buy. The Minister has agreed that the bill will not result in the provision of more affordable housing so it really is a farce from the beginning.All the evidence shows that the issue of housing in New Zealand is that there are too few affordable homes being built and the private market—private industry—cannot really be expected to fill this gap. There is too low a return for it building these homes. So who ought to fill the gap? Well of course the State has to be a part of this. The State needs to treat housing as core infrastructure. It is no less important to our economic and social well-being as roads are as power provision as water and as internet or broadband and they get treated as infrastructure whereas housing does not. Unless the State takes on housing as core infrastructure we will continue to see this problem because it cannot expect the private sector to take up the space.The Government is not being asked to do it on its own. It is being asked to do it in partnership with a whole range of organisations that are prepared to help and take on a huge part of the burden. Community organisations housing organisations iwiorganisations and councils for example are all prepared to engage in a partnership with the Government to improve the numbers of affordable homes being built. But this Government is not interested in those partnerships. It wants to leave it to the private market and keep its hands off. The fact is that the suburbs of this country the towns of New Zealand were not built by private industry; they were built by the State. They were built by the State because the State believed that in order to protect our economic base in order to provide stability for families and for workers and to ensure that children had the best chance of a good life and a fair future a stable warm dry affordable home was essential. That is why housing has been in the past some decades ago now core infrastructure but in more recent times abandoned and therefore that neglect has left thousands of New Zealand families especially the very young who are just starting out on their journey of having children and building their life together from being able to access homes.Let us just have a look at some of the statistics. Half a million New Zealanders now rent. There will always be those who want to rent but there are half a million New Zealanders who rent many of whom are trapped into the rental market because there simply are not enough affordable homes. We are seeing a decline in homeownership particularly in the middle deciles. It is among middle-income New Zealanders actually where we have seen the greatest decline in homeownership over probably the last 5 years. So we see that this is not about necessarily State housing for the very poor although that has to be part of the solution; this is about housing for the middle classes. Actually the middle classes are the ones who are suffering from the greatest decline in homeownership. We just need to look at the statistics around new dwellings. In 2003 there were 10 times more homes being built that cost less than $250000 than those that cost more than $250000—10 times more affordable homes being built in 2003. After a sharp and steady decline we are now in a situation where there are only half as many. So only half as many affordable homes are being built as unaffordable ones.There needs to be a significant shift in the way that the Government is treating housing because nobody else can do it. Nobody else has the infrastructure the funding and the low cost of borrowing to be able to do this. So the Greens are proposing a number of solutions to deal with the housing crisis. Yes we must engage in a State house building programme in partnership with a whole range of other organisations and treat it as an investment not as a burden. These are assets on the Government’s books. We must have products like the progressive ownership system for example which we have proposed in our Home for Life proposals which do not require a family to have a mortgage and do not require a deposit but are means by which families can enter into and own affordable homes while paying them off over a long period of time to create stability for them as workers and to create stability for them as families and for their children. We need a comprehensive capital gains tax on all but the family home to just help take the heat out of the market; a warrant of fitness for rental properties again to help take the heat out of the rental market; and more secure tenure for renters so those who will be locked out of homeownership for long periods of times can still have the benefit of secure affordable warm dry homes. These are not radical solutions that are untested. These are all sensible policies that will address the housing crisis and will treat housing like the core infrastructure that it is. Unfortunately this bill does nothing. We are opposing this bill.Hon JOHN BANKS (Leader—ACT): I was listening carefully to the co-leader of the Green Party Metiria Turei and I was shocked to recall in my mind the Committee stage of this Housing Accords and Special Housing Areas Bill when her colleague Holly Walker simply denied that there was a link between the supply of land and theprice of homes. It is a sad reminder to us that the Greens simply choose to deny basic economics.As I said earlier the time for debating the problem is over—it was over a long time ago—and today we have an opportunity. I am reminded of the advice that Keith Holyoake gave us all of those years ago as young members of Parliament. He said that for every bill that comes into the House there will be 80 percent of the stuff that you will agree with and 20 percent that you will not but he said that if you are part of the team promoting it you go with the 80 percent because that is way it works.I was surprised this afternoon that the Labour Party which looks after the poor and the dispossessed and the low-paid workers and those striving to make ends meet and to get a better life would deny those people the opportunity through this bill to own their first home as a first step even if it does not agree with 100 percent of young Nick Smith’s bill but agrees with only 80 percent of it. Listening to the speeches today there is a lot that those members do agree with and not much that they disagree with but they are not going to support it and they are not going to vote for it. That is not the way that this Parliament should work in the best interests of people struggling to buy their first home.So the ACT Party and the people of Epsom are pleased that the National Government is doing at least something to address the issues because what the Opposition parties are suggesting is simply not workable. Labour wants to tax New Zealanders more through bringing in a capital gains tax that cannot work. It has a xenophobic attitude towards foreign ownership because presumably the foreign owners—the 3.7 percent who bought homes in Auckland last year—are going to take them out on the Cathay Pacific flight to Hong Kong tonight. Then the next proposition is that the Labour Party is going to build 100000 new homes over the next 10 years—10000 homes a year. In the last 12 months 1300 new homes were built in Auckland. It is not going to happen.This bill is a way forward. This is a mandate to get some progress. During the period 2001-07 house prices nearly doubled and wages did not increase by more than 20 percent. With prices still rising too many young people are struggling to purchase new homes. I was disappointed to learn in the House today that the five big foreign-owned banks lending into the housing market in New Zealand are putting a premium interest rate—a penalty if you like—on those new home buyers and low-income families who are struggling to get into their first homes with their mortgages because they are stretched beyond the loan-to-value ratios that suit the bank. That is disappointing. If this Parliament can do something in the interests of getting people into their own home and building more houses in a property-owning democracy then I think that the rich and powerful foreign-owned banks should pull their weight.The Productivity Commission has concluded that there simply is not enough land that is free to build on and as a result there aren’t enough houses. In Auckland the price of a section is on average 60 percent of the price of a home. This is extremely high by international standards.My diagnosis of the problem is complete. We now know the problem. I think all sides of this Parliament agree on the problem. It is a land supply problem. It is a demand problem. There is not enough land within the urban metropolitan limits of our big cities like Auckland and Christchurch to allow the building of new homes for new home buyers and there is not enough land supply because there is not enough actual land. That is why there is a land supply problem.New Zealand is one of the least densely populated nations in the world with only 3 percent taken up by residential development. So why are people not building on the spare land? The issue is that we are not allowed to build on most of it. The Government through the Resource Management Act—and I was here in Parliament in 1991 at aquarter to 11 one night when within 7 minutes we passed unanimously in this House the Resource Management Act. It has been the greatest handbrake on investment growth and jobs that this country has ever seen. This Government under Amy Adams is doing something about it. We are trying to address it. There is a long way to go but the Resource Management Act and the bureaucratic interpretation by individual local authorities has been very bad in the interests of supplying more land to build more houses. It is great to see that we are making some progress.The metropolitan urban limit that I talked about is the worst offender. Land 2 kilometres inside the metropolitan urban limit is 8.65 times more expensive than land 2 kilometres outside it. That is staggering. The Housing Accords Bill and Special Housing Areas Bill is a lukewarm response to this but the ACT Party and the people of Epsom want me to support this in the House today because it is a major step in the right direction. I could throw out the toys from the cot but I have decided that on balance the progress is such that it deserves the attention of this House today. It deserves to be put on the statute book so that we can get more people into homes in a property-owning democracy. So I am supporting this bill.The bill itself says that these special housing zones will be established in areas that are already having a housing affordability problem. That amounts to waiting for the problem to occur and then rushing in to provide some short-term relief.The ACT Party supports significant reform to the Resource Management Act. The ACT Party supports freedom to build. The ACT Party supports the freedom to build a new housing development when there is demand from the community for more homes. The people of Epsom support a less hands-on approach by territorial local authorities and some time constraints around the bureaucratic process of resource consent. This bill addresses that. We need to let the market operate as freely as possible so new houses will get built in response to demand. New Zealanders want affordable homes and developers want to build affordable homes yet unnecessary regulation is stopping simple demand and supply from working.The ACT Party is committed to real reform around the Resource Management Act and will have plenty to say about that as this Parliament rolls on. But we are pleased that the Minister and the National Government are doing at least something to address the issues through this legislation because what the Opposition parties are suggesting is laughable. It is time for real action not just a few special housing areas in places where we have a real crisis on our hands. New Zealanders who work hard deserve to be able to save and buy their own home. We must restore the freedom to build. The people of Epsom and the ACT Party support this legislation.DENIS O’ROURKE (NZ First): The National Government has waited several years while a housing crisis developed. Over the last 5 years the Government has allowed a housing bubble to emerge in Auckland by its inept immigration and housing policies. Now it blames local government. The Government pretends that with the introduction of housing accords and special housing areas it can solve the problem. But it will not. Only a comprehensive housing strategy to address both demand and supply factors as advocated by New Zealand First will make housing affordable for home buyers.The price of houses will not reduce under this legislation. Even the rate of increase is unlikely to reduce as a result of this legislation. First-home buyers will not be able to afford a house because the Government’s approach will have no effect on their capacity to raise a 20 percent deposit or to find an affordable home. Historically low interest rates are now rising to make matters worse.New Zealand First supports a broadly based housing policy that will again make homeownership a reality rather than a dream for ordinary New Zealanders. NewZealand First wants to see direct assistance to first-home seekers. Although New Zealand First has no problem with the concept of housing accords and special housing areas they will not be enough to improve the housing crisis.What the Government fails to grasp is that the housing crisis is not driven just by the availability of houses on the market but by the price driven by many other factors as well and by access to finance especially the capacity of first-home seekers to raise a 20 percent deposit as is now required.The Housing Accords and Special Housing Areas Bill addresses only the issue of collaboration with local government to assist it to ensure land availability. This is clearly only a part of the problem. It does not actually cause any more houses to be built and it does not address the issue of the affordability of those houses. The hopes of at least 80 percent of first-home seekers have now been annihilated by the Reserve Bank’s limiting of the quantum of high loan-to-value ratio mortgages that the trading banks can make. This will do great damage to the proper expectations of first-home seekers to buy a family home. This does not address the fundamental issue. The Reserve Bank does not care about it. This Government obviously does not care about it either.Another problem not being addressed is that overseas property investors and speculators have been buying up Auckland property outbidding Kiwis trying to buy a home and worsening the housing crisis. They of course are not hurt by the Reserve Bank’s loan-to-value ratio restrictions. Back in March this year the BNZ-REINZ Residential Market Survey said that in Auckland an estimated 11 percent of sales are to people offshore not 3 percent as Melissa Lee claimed—11 percent. You see I actually read the report so I know that as a matter of fact—11 percent not 3 percent. That is a significant proportion of the total number of home buyers in Auckland contributing to the housing bubble there.The trend is worsening. There is still a significant number of real estate agency companies promoting Auckland houses in Malaysia China and other parts of Asia. Here is what one recent Chinese magazine article said: “What could be better than a picturesque comfortable country that is attractive to foreign buyers? You can benefit from New Zealand’s rising domestic housing market. Data released last month reported the Auckland real estate market is firing like crazy and will soon exceed the 2007 peak and international buyers can share in this.” That gives you a flavour for what is going on as far as encouraging overseas people to buy houses especially in Auckland.The Government also does nothing about the migrant flows that have been concentrated in Auckland. It does nothing to tighten immigration policy in areas such as parental reunion which have added significantly to housing demand in Auckland. This is not xenophobia. It is good immigration policy to create those restrictions. It puts New Zealanders first and that is one of the primary purposes for New Zealand First in this Parliament.Most important the impact of Reserve Bank policies will fall most directly on first-home buyers. The Government’s response to that has been pathetic. All it has done is ease access to KiwiSaver which is both ineffective and inappropriate because the Government should be encouraging people to save for their retirement.This bill may do some good in assisting local government to free up land for housing but it is far far too little and far too late. It is likely to be at the expense of good planning too and at the expense of the usually well-thought-out plans of city councils and regional councils to balance housing land availability with sustainable urban boundaries. And it will be at the expense of local democracy with local people having a very limited say in what will happen to their own city and their own neighbourhood.This bill lacks balance. It lacks a strategic approach that would cover all of New Zealand and not just Auckland’s problems. It will not in the end help even one of the thousands of young families on limited incomes seeking their first home to find a modest and affordable home on a smaller section and to access a deposit and a sufficient home for their needs. These people need a Government with the ability to get them into a home they can afford. This legislation is a dismal failure in bringing that reality to them. So in the end New Zealand First has resolved to oppose the bill. The basis of our opposition is not opposition to the concept of housing accords or special housing areas; it is a protest at the inadequacy of Government housing policy. It is far far too little and far far too late. It is mostly a protest at the Government’s tacit approval of the Reserve Bank’s shutting out of low-income first-home seekers from the New Zealand housing market.This Government does not get it. The problem is affordability—affordability—for these people. Much much more needs to be done about that and this Government simply has no ideas about how to deliver affordable homes to New Zealanders and to assist them to get their first home. It should be one of the first priorities at the top of the list for any Government in this country. This Government’s attempt to attack that problem after 5 years of inaction has been utterly pathetic and this bill demonstrates that much better than my words can say.Hon PHIL HEATLEY (National—Whangarei): People watching and listening to this debate on the Housing Accords and Special Housing Areas Bill will wonder why the member for New Zealand First Denis O’Rourke was using notes so much—essentially a read speech from a paper presented to him. You know if you do not know the facts or know the portfolio well or know the sector well you cannot speak to it well. So what I thought I would do is give just a brief history of time and cover the range of housing issues that people out there face—[Interruption]—people whom list MPs in New Zealand First do not need to face.First of all when it comes to buying a house—and even renting because you are essentially paying the landlord’s mortgage—interest rates are the most important issue. So if you have a $300000—The ASSISTANT SPEAKER (Lindsay Tisch): Order!Hon PHIL HEATLEY: New Zealand First will need to concentrate; if you have got a calculator grab it. If you have got a $300000 mortgage and interest rates go up by 1 percent you have got to find an extra three grand a year.The ASSISTANT SPEAKER (Lindsay Tisch): Order! Do not bring me into it.Hon PHIL HEATLEY: If the interest rate goes up 2 percent you have got to find six grand a year. If it goes up 3 percent you have got to find another $9000 a year. Interest rates in recent years have been around 5 or 6 percent. Under Labour they were 8 9 and 10 percent. That is how Labour managed the economy. Under Labour people had to find an extra $3000 $6000 or $9000 a year just to service a mortgage.What about social housing? Under our policy we have seen social housing providers supported through the Social Housing Unit. Labour never gave them income-related rents. We are looking at that at the moment. In Hobsonville the Labour Government owned the land for 5 years and never built a single house. Labour members talk about what Hobsonville could have been—State houses and all the rest. In 5 years Labour never built one house—one house—and it is the same inTāmaki.We have also upgraded State housing. You will know that 7000 or 8000 State houses across New Zealand were not even insulated—tens of thousands of State houses across New Zealand were not even insulated. They are all going to be insulated by the end of this term and so they should be. Old cold and mouldy houses under Labour are not what we support.The Resource Management Act and the Building Act—more regulation under the Labour Government and we have cut back on that. Of course this bill which solves the last of the holistic problems covers the suite of projects that we have put forward which I listed—one of which is land supply. It is very very important to supply land for housing. The Labour Party opposes new land for housing. Labour members call that sprawl. They oppose density. You cannot squeeze in housing together and go up. So they are against more land for housing and they are against using land better by increasing density. I do not know where they are but this bill shows clearly that we are looking at the suite of options.We understand that there is no silver bullet no quick fix. You have to look at regulation you have to look at interest rates you have to support social housing you have got to upgrade those State houses and you have to increase the land available for housing to be built on. I support this bill.Hon MARYAN STREET (Labour): It gives me some pleasure to rise as a former Minister of Housing myself after the speech from the former Minister of Housing Phil Heatley. So let us just track through some of the different ideas that exist between the National Party and the Labour Party on housing affordability.First of all however I do want to say that in the 5 years that this Government has been in office we have seen a stunning lack of activity on housing affordability. The previous Minister—the member who has just resumed his seat—has said that he came into the portfolio on a slogan about cold old and mouldy houses which was just about the only thing he ever saw fit to address in his time. There was no acknowledgment of the work that had gone on by the previous Government in upgrading and insulating State houses starting with the coldest part of the country first at the bottom of the South Island and moving progressively northwards so that we could improve the state of our Government’s housing stock for those who are most in need.In addition to that of course we also brought in a subsidy system for insulation for homes owned in the private sector and that of course is never acknowledged by the former Minister of Housing. Suddenly getting to this point 5 years on in this Government’s tenure and seeing a rush of activity on housing affordability tends to make us on this side of the House roll our eyes.One of the points is that in the period that the National Government has been in power since the end of 2008 we have seen skyrocketing prices. Prices for housing are up 30 percent in Auckland and up 26.5 percent in Christchurch. We have seen 1500 fewer building consents between 2008 and 2012. This Government has not been attending to the issue of housing affordability. I thought the situation was dire when I was the Minister of Housing in 2007-08 but in fact there has been a more precipitous decline in homeownership particularly in Auckland in the last few years than at that time. Not only have we seen housing ownership levels getting worse but we have seen this huge increase—some 17 percent on average I think—a 17 percent increase in housing prices over the whole of New Zealand. It is worse in Auckland worse in Christchurch and worse in those less affordable parts of the country but it has got worse under this Government not better.In response to one of the earlier speakers I would like to say that Labour would be happy to support this bill if we thought it would make one jot of difference to housing affordability. Nowhere does it talk about housing affordability except by implication in a rushed Supplementary Order Paper 351 which the Minister brought to the Committee at the last minute earlier this week.So this bill is not about a planned systematic approach to housing affordability. This is a knee-jerk reaction because there is a lot of noise out there about housing affordability. It was bad enough when I was the Minister of Housing but at least webrought in legislation that made it possible for local authorities to require 10 percent—not the whole lot just 10 percent—of any residential development to be put aside for affordable houses.What did the National Government do on assuming office? Almost immediately it repealed that legislation because National has never been concerned about the low to middle income earners who have as much right to get their foot on the first rung of the homeownership ladder as anybody else. Now that it is beginning to squeeze the children of the upper middle class whom the National Party listens to more than anybody else the National Government is hearing the noise for the first time and that is because the prices are so much higher than they were even 5 years ago.In addition to bringing in legislation in our day we brought in a raft of other measures such as the Welcome Home Loan which in fact this Government has kept but has cut back its funding. We introduced the KiwiSaver measures which allowed for those who had invested in KiwiSaver signed up to KiwiSaver and saved a certain amount—$1000 a year for 5 years—that $5000 would be matched by the Government with another $5000. So if a couple could manage to save $5000 over 5 years which is achievable even on a low to middle income if one works hard at it then that would have been a combined amount of $20000 to go towards a deposit which in concert with the Welcome Home Loan would have given people the first step up on that ladder of homeownership.But the shared equity scheme that we introduced was scrapped by this Government. It repealed our laws as it has said. It has opposed the ambition of having 100000 new affordable homes over a 10-year period. It has opposed our proposals for a capital gains tax that would see a tax on a capital gain made from speculative investment in housing and would change the nature of where people in this country might invest.I also want to correct something a previous member said when she railed against xenophobia. I would join her in railing against xenophobia. There is no place for xenophobia in this multicultural society of ours. But I would say that our opposition to foreign buyers is on the basis of those who speculate not those who want to come and live in New Zealand. It is on the basis of their being speculators not people who are genuinely seeking to be citizens and permanent residents of New Zealand. So let us not hear any more nonsense in that respect.Finally I want to revert to one of my old themes and it is about land supply. The previous speaker Phil Heatley talked about land supply being the critical factor; it is only one of the critical factors. Low wages are another critical factor in housing affordability. It seems to me that in the releasing of Crown land for increased density—which is what the Labour Government did both in Glen Innes and in Hobsonville—that was the approach that combined all the necessary factors to get things going. The Minister told us the other day that 400 houses had been built in Hobsonville—400 houses had been built in Hobsonville. We were meant to applaud him. How many of them were affordable? How many were affordable? Seventeen were affordable. Seventeen of them are meant to be affordable houses. So this Government has no interest in genuinely addressing affordable housing. If it was genuinely interested it would have brought forward a bill that would achieve that rather than this nominal piece of nonsense that we have in front of us today. Thank you.ALFRED NGARO (National): I rise to take a call on the third reading of the Housing Accords and Special Housing Areas Bill in its final stage. I want to commend the Minister of Housing. I also just want to take a short call because much has been said by my colleagues about both the substantive process and the outcome in this piece of legislation which we think is absolutely important. The regulatory impact statement established in its overall conclusion that the special housing areas in which localcouncils or the Ministry of Business Innovation and Employment would exercise more flexible resource consenting powers in conjunction and collaboration with the Government’s proposed changes to the Resource Management Act would most likely increase land supply over the short term in ways that are consistent with collaboration with those two parties. We believe that this is important.I just want to cover a couple of brief comments in regard to the submissions that we heard in Wellington and Auckland. Here are some of the things that we have heard in responding to the submitters and have amended the bill accordingly. We had submitters that were genuinely supportive of the Government’s intention to streamline planning and consenting to boost land supply and housing supply but there were some changes. In fact the Property Council in its submission said that this is not a silver bullet. The Social Services Committee made changes to strengthen the bill by clarifying how and when the powers of the bill can be used and by clarifying how the provisions of the bill will work with other legislation including the Resource Management Act.The select committee also amended the bill to specify the inadequate infrastructure which was a concern from a number of developer submitters who talked about the concern that there was not the parallel development in regard to infrastructure. So the bill has been amended to ensure that infrastructure must either exist or be likely to exist in proposed special housing areas.I just want to cover also one other key principle. I think that what was quite critical was that there was a lot of concern in regard to the override principle. We have to be up front and honest about that. Some might call it an anti-democratic approach but really it is a process and a way of ensuring that if there is no ability to come to an agreement in the sense of progress then there must be a process to move this intent on. The select committee has also heard along with the Minister and has agreed that in regard to the override principle there be included a dispute resolution process. This has been important along with Supplementary Order Paper 351 and what it includes around establishing the affordability criteria. Again it was quite clear that submitters wanted to ensure that when we talked about affordability—and I want to finish on this because I think this is important. Supplementary Order Paper 351 further improves the bill by allowing councils to consider the affordability of dwellings when recommending the criteria for qualifying developments. This is something that was quite clear in the submissions. It was something that submitters felt was very important in addressing the areas around affordability. This adds to what I think is a very substantive piece of legislation. I commend this bill to the House.The ASSISTANT SPEAKER (Lindsay Tisch): I understand that the next call is a split call.Su’aWILLIAM SIO (Labour—Māngere): I would like to take a short call on this bill the Housing Accords and Special Housing Areas Bill. I think that we on this side of the House are absolutely clear that there is a housing crisis and that it has an impact on our communities throughout the length and breadth of New Zealand. The Government has known about this housing crisis but I suspect that it has not worried about trying to address it. In the 5 years that this Government has been in office it has actually accelerated the housing crisis by attempting to sell off State houses and by gutting Housing New Zealand and removing the social focus of Housing New Zealand and when it approved a loan-to-value ratio of 20 percent it made it virtually impossible for families who want to buy their first home to be able to buy that first home.Currently we have families who are unable to secure proper rental properties because the prices of rental properties are high or because the quality of some private rental properties is some of the worst we have seen—not all but some. We now have a situation where even though a person might need a house and even though they mightbe living in garage or living in car if they trot up to Housing New Zealand they will not necessarily be able to access a house. Housing New Zealand will simply either recognise them as client A or client B; client A having priority and client B irrespective of whether they are living in a car or not simply would not be able to access a house.When I asked the Minister earlier about how many of these houses would be affordable and what the price of an affordable house is—which he envisages will arise from this bill—the Minister’s response was that that would be left to the market. Well let us look at the market. Currently if you are looking at a $200000 two-bedroom or three-bedroom bach in the rural areas out in the boondocks where there are no jobs where there are no Government services you would still have to front up with a $40000 deposit.Then the question is whether that person will be able to sustain that mortgage. If a person is on a median income of $20000 a year then there is a big question mark. If the house is in the city where some of the cheapest two- and three-bedroom houses are around $300000 $400000 or $500000 a person still has to front up with a $60000 to $90000 deposit and still has to be able to maintain that mortgage. The proposal to raise the loan-to-value ratio to 20 percent means they have to front up with a $60000 to $90000 deposit. But the median household income for some of our cities particularly in Manukau if I can use it as an example is $40000. The question is whether someone on $40000 is able to sustain a mortgage of $400000. There is a big question mark on that.But the appalling thing is that when the Minister says that the situation is left up to the market he reveals that this Government has not learnt the lesson that the market has failed. That is the reason why it keeps blaming the global financial crisis for the situation that we are in. The market has failed and that Minister and that Government have not learnt a single lesson from the mistakes of the past and they continue to peddle these ideas.This bill does not provide affordable housing. What it does is it enables the Government to control a council and it enables this Government to be able to allow for development that favours its mates and its friends. Simply allowing land to be freed up does not necessarily mean that people will be able to build affordable houses. In fact once the zoning of rural land is moved into residential that in itself will ensure that the price of that land will increase. This bill is not about affordable houses and anybody who believes that will also believe those lies.EUGENIE SAGE (Green): The Green Party does not believe that this Housing Accords and Special Housing Areas Bill is part of a good solution to our housing affordability crisis and it is not just the Green Party that is saying this. As the Hamilton City Council said in its submission: “Housing affordability is a complex issue and it would be better for the Government to develop a comprehensive integrated and holistic affordable housing policy in collaboration with key stakeholders.”Of course local authorities are one of those key stakeholders. The Christchurch City Council is the largest provider of social housing in New Zealand after Housing New Zealand. But this bill undermines any sense of collaboration and partnership with those stakeholders because of the ministerial override provisions. They allow the Minister to cut across the statutory role of local authorities in deciding in consultation with their communities where new subdivision and residential development should occur and how it should occur. If the Minister cannot agree with the council he can then simply designate special housing areas and just establish them and have the Ministry of Business Innovation and Employment take over the consenting role. And he can revoke those areas at will as well.Where these special housing areas are created outside metropolitan urban limits—we had the Minister talking about thousands of hectares of land being freed up—this will be a boon for property developers because if the development is a “qualifying development” in terms of the criteria in clause 14 of the bill and in any regulations that the Minister chooses to gazette the developer can then apply to fast track those developments. That shuts out the community from decisions on where and how and when urban growth should occur because under those fast-track provisions it is only neighbouring landowners the local council requiring authorities and infrastructure providers that may be notified and may have an opportunity to put in submissions. So that is one of the reasons why the Green Party opposes the bill. It cuts right across public participation and it also limits appeal rights.We are also opposing it because despite the rhetoric of the Minister it is not about simplifying and streamlining. It is setting up a different decision-making process with different criteria to those that exist in the Resource Management Act. We also oppose it because it erodes local democracy through the Minister’s override powers and his ability to establish these special housing areas.Again as with the Resource Management Act changes the Government is talking about quick decisions rather than quality decisions. So we risk having ad hoc sporadic urban development and urban sprawl rather than the compact urban areas that we want for sustainable growth. As Local Government New Zealand said in its submission: “The pendulum has swung too far in the direction of speed away from community involvement and the robust assessment of environmental effects.” So yes we may get things happening quickly but that does not mean that they are going to be sustainable over the long term.We also oppose the bill because it does not recognise the work that a lot of local authorities are doing to plan for growth. You have got the Wellington City Council which has got a sound urban development strategy. That has over 20 years of land supply through a mix of high density infill developments central city apartments and greenfield land. Again it is this Government centralising power rather than trusting local authorities to work with their communities and have sensible growth.We in the Green Party believe that if we are going to deal with this affordable housing crisis you need a package of measures. This includes a capital gains tax on everything except the family home which will help deflate the property investment bubble. We want the Government to recognise that because there has been a market failure the Government should be investing in building affordable homes. As Metiria Turei said that is an investment because if you give people a warm dry safe secure home that is the basis for family stability and it is the basis for healthy families for educational achievement and for good health. That is an investment in our people and in our country not a cost in the way that this Government by relying largely on the market seems to think it is. We wantlivable cities compact cities where you have got land-use planning that is integrated with public transport. This bill does not deliver that. It delivers sprawl and ghettoes on the edges of our cities.MIKE SABIN (National—Northland): If we were living on Fantasy Island that contribution from Eugenie Sage would have been absolutely appropriate. But—Hon Simon Bridges: “The plane! The plane!”MIKE SABIN: “The plane!”—that is right “The plane!”. But actually we are not. We are living in the real world not in the Green vacuum. As for this legislation and this Minister of Housing if we are to accept criticism—and we do accept some criticism from across the floor. But if the criticism of this Housing Accords and Special Housing Areas Bill is that this is moving too fast and this will have things happening too fast then I say that we welcome that criticism.There are hundreds if not thousands of New Zealanders who are queuing up wanting land and who are wanting to build or buy a home and cannot. This bill is about Economics 101. It is about freeing up land. It is about providing enough supply to meet the demand. This bill is not about solving all of the problems; if nothing else it is one aspect of solving the nexus between the supply and demand situation in particular in the city of Auckland. If it is good enough for the pseudo-leader of the Labour Party the de facto leader of the Labour Party Len Brown to support this legislation and if it is good enough for Len Brown to work on pragmatic solutions for his city with the Minister then why is it not good enough for the Labour Party to support this bill?The Labour Party’s solutions to this are firstly to oppose because that is what it will do to any pragmatic solution; secondly to criticise because that is just what it does and it does it so well; thirdly to ban Asians and get all xenophobic about it; and fourthly to impose a capital gains tax. I could throw in a few other things if I had the time. One of the special ones is to promise 100000 homes in 10 years for an average of $300000. Of course these are homes that must levitate—must hover above the ground—because when the average section is $325000 in Auckland how can one build a house for $300000? It is lunacy. It is Labour Party politics. That is why members are scrambling around trying to find someone who might be crazy enough to stand up and lead that party—because it is leading itself into oblivion. This is good legislation. I commend the Minister and I have been pleased to work on the bill. I commend it to the House.A party vote was called for on the questionThat the Housing Accords and Special Housing Areas Bill be now read a third time.Ayes63New Zealand National 59;Māori Party 2; ACT New Zealand 1; United Future 1.Noes56New Zealand Labour 34; Green Party 14; New Zealand First 6; Mana 1; Independent: Horan.Bill read a third time.