Scott Alastair; Dyson RuthALASTAIR SCOTT (National—Wairarapa): Thank you very much Madam Speaker. I don't agree very much at all with Marama Davidson the previous speaker generally but specifically there is one thing I do agree with her on and I'd like to preface my next few minutes by saying that both sides of the House agree that we want safe warm and dry homes for our tenants. There's plenty of examples and plenty of legislation that this side of the House has done in the previous nine years to ensure that is the case. Some of that legislation is coming into force now. Interestingly Housing New Zealand is exempt from a lot of that. It's quite ridiculous. So the largest landlord in the country is exempt from complying with the same laws that you or I might have to comply with if we are a landlord. It's ridiculous. Why isn't the largest landlord in the country complying with the same laws same rules as every other landlord? The second point I would like to make is I wanted to talk about the cost of capital. So previous speakers on this side of the House have talked about why it is difficult for landlords to stay in the market. We talk about the last straw on the camel's back. I've had landlords ring me up to say This is it. I cannot get these tenants out. I can't even get on to the property. They will not see me. I've given 48 hours. I've got them in front of the Tenancy Tribunal."—and that is clogged. The Tenancy Tribunal in the Wairarapa is clogged full because we've got a situation where the Government is not allowing landlords to express their rights by removing bad tenants. Cost of capital—this is the stuff that we need to build houses. This is the stuff that landlords provide to the market to enable houses to be built and tenants to be housed. Now if the Government wants to put another cost on to the cost of the capital of the landlords there's only one thing for it—assuming they want to stay in and be bothered with dealing with it—and that is to put the cost up. The revenue has to go up to match the costs on the other side. So it's very simple. We've already seen costs go up because of the brightline test extended by that Government. We've seen costs go up because landlords have had properties ring-fenced. That increases the cost of capital. Therefore the landlord is going to demand—they're going to demand—a higher return for that property because they've got to pay the bank the mortgage and they've got alternatives to put that capital in. If they're not going to get the return on capital that they deserve that they demand and that the market allows them to do they will simply move that capital to a different place. They'll just put it in the bank and forget about it. They'll put it in the sharemarket. They'll invest in the NZX or the New York Stock Exchange—whatever it might be. But they will not choose to invest in the property market—they will not choose to invest in the market to enable tenants to provide homes. If they do though they need to get their return on that capital. As this Government puts in more regulations more layers of costs then the price of that capital goes up. This is just another cost of capital inflicted on landlords which will see rents rise. One of the points I would like to make though and I find it quite inconsistent is that the Government's quite happy to allow foreign capital into the Auckland light railway project—the Canadian money that's going to come along and partner with the New Zealand Superannuation Fund—but they've already banned foreign investment into property. There's some inconsistency here. The other inconsistency is that we're allowed to tender and allow auctioning on first homes for sale—that's fine—to see the highest price enabled for the seller of a property but the landlord is no longer able to do that. If they choose to do that they're no longer able to do that. So what's going to happen? The landlord will work a way around it if he wishes to play in the landlord game and as we've heard a lot of people are leaving. The issue was that these guys banned the agency fees so a landlord can't on-charge to a tenant a fee. There's another cost that's been put on the landlord and is therefore reflected straight away in the rent. The landlord must get a return on capital and putting all these layers upon layer upon layer of costs only will always be reflected in the cost to the tenant. The fact that rent prices might be high is to do with all those costs associated with this Government. The answer is obviously an increase in supply. That is the key to reducing the cost of housing and therefore the cost of rentals. These guys are barking up the wrong tree walking down the wrong track. They really need to rethink where they're coming from and consider the capital where it's coming from and the return that's required and demanded because without that the tenants are only and always going to suffer. ASSISTANT SPEAKER (Hon Ruth Dyson): The next call's a split call—five minutes."