Parker DavidOVERSEAS INVESTMENT AMENDMENT BILLFirst ReadingHon DAVID PARKER (Minister for Trade and Export Growth): I move That the Overseas Investment Amendment Bill be now read a first time. I nominate the Finance and Expenditure Committee to consider the bill. At the appropriate time I intend to move that the bill be reported to the House by 20 February 2018 and that the committee have authority to meet at any time while the House is sitting except during oral questions during every evening on a day where there is a sitting of the House and on a Friday in a week in which there has been a sitting in the House and outside the Wellington area despite Standing Orders 191 193 and 194(1)(b) and (c).First I would like to thank Treasury the Overseas Investment Office and other agencies for their hard and quality work at short notice on an urgent matter. This bill implements the Government's commitment to ban overseas buyers from purchasing existing New Zealand homes. The purpose of the Overseas Investment Act as set out in its purpose statement is to acknowledge that it is a privilege for overseas persons to own or control sensitive New Zealand assets. The Government considers that residential land and homes are sensitive assets and therefore that overseas persons should be able to acquire them only in certain tightly defined circumstances where that acquisition is for the benefit of New Zealand.We think it is the birthright of New Zealanders to own our houses as well as our farms. We believe that our homes should be traded on a New Zealand market not an international one and to us this applies at all levels of the market. Our best homes and farms should be purchased by our most successful New Zealanders and our most modest homes should be also be purchased by New Zealanders so that as many New Zealanders as possible have a chance to achieve the Kiwi Dream of homeownership.New Zealand First as well as Labour and the Greens believe those who are committed to our country are those who should have the privilege of buying our homes and that they should not be able to be outbid by wealthier people from overseas. We know that more and more of the world's wealth is accumulating in the hands of a very small minority—less than 1 percent. We know from the Panama Papers and from Piketty's book Capital in the Twenty-First Century that many of these people pay low or no tax on their income overseas. In the face of that reality the Government has the right and the duty to protect their local citizens from overseas accumulators of wealth impacting on the New Zealand housing market. Therefore this bill brings residential land within the category of sensitive land" in the Overseas Investment Act.National said this could not be done. They said that we had to choose in this country between trade agreements and controlling who buys New Zealand homes. They misled New Zealanders before and during the election. Todd McClay said a ban would force New Zealanders to renegotiate many of our trade agreements and we would likely lose some trade access as a result of renegotiations which would harm New Zealand companies and Kiwi jobs. It was National who abandoned the prior consensus on trade. It was National who tried to wedge Labour by forcing us to give up on our belief in trade and/or our desire to keep New Zealand homes in a New Zealand market. And New Zealanders will now see that the current Government the new Government has shown them to be wrong and shown the last Government the last National-led Government to have been either disingenuous or incompetent—and I think history shows the answer is probably both.The changes that we will make will ensure that more New Zealanders own their own home and that over time fewer Kiwis pay rent to overseas landlords. It means that more can aspire to homeownership and have a stronger stake in their communities as well as building their assets and wealth here in New Zealand. This bill recognises and reaffirms that it is not a right of overseas buyers to own a home here.Hon Dr Nick Smith: Whoever said there was?Hon DAVID PARKER: National effectively did Dr Smith. National said we couldn't do it and we have. National made no effort to leave the option open to future Governments and we have opened a door. If this had not been done before the Trans-Pacific Partnership (TPP) came into effect it could in effect never be done. What was happening was that National were trading New Zealanders' rights to control who buys homes in their country down the river for ever and they were pretending that there was no alternative option open to the Government. It was a disgrace.Treasury's regulatory impact statement correctly notes that this law has been hastily drafted.Hon Steven Joyce: Rushed.Hon DAVID PARKER: Rushed—that's correct Mr Joyce; rushed because of the incompetence of Mr Joyce's Government. Because National did not preserve the country's interests under TPP we've had to tidy this area of law up urgently before the Comprehensive and Progressive Trans-Pacific Partnership comes into effect.We are keeping faith with New Zealand voters. Under this law as we said—as we've always said—if you've got the right to live here you've got the right to buy here. That was our line and we've maintained this. Under this law only New Zealand and Australian citizens and permanent residents of both countries—Hon Simon Bridges: And Korea.Hon DAVID PARKER: —living in New Zealand will be able to buy an existing home in New Zealand. Now Simon Bridges just said "And Korea." Wrong again. You should have read your Cabinet papers or made sure that you had Cabinet Minister colleagues who knew their business. They didn't. Only New Zealand and Australian citizens and permanent residents of both countries that are living in New Zealand will be able to buy an existing home in New Zealand without going through screening from the Overseas Investment Office. Citizens will be exempted from screening regardless of where they reside.Permanent residents of New Zealand and Australia in order to be exempt will need to be ordinarily resident in New Zealand. For residential land purchases this means they will have to have a permanent resident visa and have resided in New Zealand for the last 12 months and have been present in New Zealand for at least 183 days in that period. Effectively that means they've got to be tax residents. They've got to have been putting their shoulder to the wheel of the New Zealand economy if they're not a citizen rather than using New Zealand as a bolt-hole and not contributing to the taxes that maintain our roads and our hospitals and our schools and all of the social services that make this a great place to live.Residents who have not achieved permanent residence will be able to apply to the Overseas Investment Office for consent to buy a home provided they show a commitment to reside in New Zealand. The scope of this test and criteria to determine the commitment will be defined in regulations. Applicants granted consent will be restricted to buying one home which they must live in. If they leave New Zealand then they've got to sell it within 12 months. Issues in respect of Singapore are being worked through. Anyone else will not be able to purchase residential land or houses to live in.Overseas investment persons can apply to the Overseas Investment Office to develop residential land in a way that will benefit the country by adding to housing supply. In particular they'll be allowed to purchase residential land if they can demonstrate to the office's satisfaction that they will increase housing supply through their investment in and commitment to sell the properties that they will build or through expanding long-term accommodation facilities such as a retirement village; or that they will convert land to a non-residential use such as a commercial development or a motel and they can show the development will be beneficial to New Zealand.The new definition of "ordinarily resident in New Zealand" and the commitment to reside in New Zealand will apply to the screening of all transactions that include residential land including land that's already screened for sensitive land purposes for other reasons—for example lakefront land over 0.4 hectares. The screening tests and compliance enforcement measures that are in the bill associated with the operation of the rules will be conducted by the Overseas Investment Office. The bill enhances information-gathering and enforcement powers of the office that are actually already needed in respect of other areas of investment screening.In addition to the proposals in the current bill the Government's also investigating other potential changes which if necessary will have to be done by Supplementary Order Paper because we lose the space otherwise to do it once TPP comes into effect. This Government welcomes foreign direct investment that adds to the productive output of this economy but investment in existing residential houses does not and in the future will not be allowed."