O'Rourke Denis: Budget DebateText is incorporated into the Bound VolumeO'Rourke Denis: Budget Debate[Sitting date: 27 May 2015. Volume:705;Page:4045. Text is incorporated into the Bound Volume.]DENIS O’ROURKE (NZ First): New Zealand has developed a housing crisis since the National Government took office in 2008. It has developed it since then. It has been like the frog in the saucepan waiting for the heat to increase without noticing it until the pot boils over. The crisis during that time has become chronic and this Government has done little or nothing about it. In fact this Government has had a worse record in meeting housing demand than any other Government in living history. In the last 6 years house prices have gone through the roof in Auckland and nobody over there could deny it. Houses are now unaffordable to most homebuyers and very little is being done to help. We have had some action taken on access to KiwiSaver at the price though of compromising retirement savings. Too many people do not have access to enough money in a KiwiSaver account to make any difference. The causes of the crisis have not been addressed. Few Kiwis have left for Australia that is true and that has led to an increase in demand but so has relatively uncontrolled immigration—56000 in the last year. That has led to a very significant increase in demand for housing and the Government has done nothing at all about that. According to the Bank of New Zealand 11 percent of homes are sold to foreign buyers in Auckland—11 percent—and the Government has done virtually nothing about that.Even this Government cannot deny the problem now. It is belatedly bolstering tax rules on residential property which is something that should have been done years and year ago. There is no need at all for a capital gains tax if income tax is broad enough. No action has been taken on that either. The Government is not doing enough about foreign buyers. Requiring overseas buyers to have a New Zealand tax number is not nearly enough. Determined buyers from overseas will not be deterred by that at all. The brightline test for all buyers selling within 2 years is much too easily avoided and will have little effect. Two years is too short. Although special housing areas and accords with councils will help the real issue has been the Government’s unwillingness to invest directly in housing itself. New Zealand First’s policy is for the Government to buy and develop land for housing and to use existing Crown land for the same purpose and for the Government to sell directly smaller sections thereby making modest homes more available to more people with easy repayments over 25 years at a low interest rate.The Government has taken a leaf out of New Zealand First’s book with its use of Crown land but only 400 hectares of it—a very small portion. It is only 400 hectares and only as a last-minute effort in the Budget to try to look a little bit better. It is very cosmetic. Even that land is ill-defined. We do not really know exactly what land the Government has got in mind and not all of it of course will be suitable. Only $52 million has been allowed for in the Budget to develop that land and that seems very light. There is also very little information about how all that will work. The Government should take another leaf out of New Zealand First’s policy which requires a permanent special agency to buy and develop land for residential housing.The Government has had an even worse record in social housing. The average rental is now $379 a week. Since 2008 the increase under National has been $65 a week or 20 percent and 11.7 percent above the Consumers Price Index. That is huge. People cannot avoid that. In Auckland people typically have to pay 50 percent of their take-home income in rent and that is crippling. In Christchurch people often have to pay something like $1000 a week or more for an ordinary three-bedroom house. It is a very significant problem in the major cities. The Government’s social housing measures will not help to increase rental housing stock. Those measures are designed to minimise the role of the State and to emasculate Housing New Zealand. This Government is actually abdicating its responsibility for social housing by contracting it out to non-governmental organisations and private providers. Government members say there will be flexible purchasing as described in the Government’s recent legislation allowing what they call tailored agreements dictated in detail by Ministers who will be biased of course. That is to try to give certainty to providers so that they can go out and borrow money and build homes. But are they really capable of doing this job? We really will not know until it happens—until the worst happens perhaps. But Housing New Zealand of course could do all that and used to do all that much faster and much better. So what is the point of this exercise of farming it out to non-governmental organisations?The whole thrust of the Government’s housing programme is to suppress demand for State rentals to do little for first-home buyers and it simply does not adequately address the housing crisis at all.