Woodhouse MichaelHon MICHAEL WOODHOUSE (National): I think it's appropriate to start with the one part of that speech that I think every member of this House will emphatically agree with and that is the Minister's first words which were: Every New Zealander deserves a warm healthy home." We certainly agree on this side of the House that that's the case. And it isn't acceptable that 15 or 16 mostly elderly but from time to time very young New Zealanders die in homes that are cold and damp and that there are more than 40000 preventable diseases contracted by our young in those homes.In my second reading speech I mentioned a hope that as we debate this bill we don't retrench back to the hyperbole that we had a year ago: that those that were opposed to these goals somehow did not care about those children. The House has been very responsible in that regard. It's focused on the issues which I'm very grateful for.We eventually got to the nub I think in the committee of the whole House of what this bill is going to do. As I mentioned it wasn't possible for us to know whether we were opposing it because it was innocuous and did nothing or because it was going to be a crushing and mis-targeted imposition on property owners and the Crown and the tenants. The reason is that despite the fact that the Government in its fiscal plan has $300 million set aside for grants for this initiative there is a form of mathematical alchemy that would be required to make that enough to fund what we now know are going to be the changes as a consequence of this legislation.The Minister in the committee stage told us that it will be necessary for landlords to meet a higher standard—a more recent standard. He didn't say which standard but it would be ridiculous to require the higher standard but not the current standard so we have to assume from that that the goal is at the 2008 standard—a more recent standard than the 1978 standard. But "It's OK" because there will be a grant process and it will be available to not only landlords but owner-occupiers according to the Minister and the $300 million set aside for that purpose is designed to provide that grant for 150000 homes over four years.Only here's where the alchemy is required. In the rental market alone there are nearly 600000 properties. All of them will be required under the regulation the Minister intends to pass to be upgraded to this new standard the current standard—600000 rental properties. About 80 percent of them are owned by mum and dad landlords people who support the Labour Party—nurses police teachers; that's their retirement nest egg—and 80 percent of the owners of those properties have two or fewer. They have only one or two. And all of them if they don't already comply with the 2008 standard will need to comply when the tenancy is renewed after 1 July 2019. So the maths cannot possibly stack up if that is the requirement.If it's compulsory there's no way that even the renters by a factor of probably two to three can access that grant under the current appropriation of $300 million much less the owner-occupiers that the Minister talks about and the back-of-the-envelope calculations which nevertheless are better than the calculations that the Minister has done suggest that the total cost of this could be more than a billion dollars.Hon Louise Upston: A billion?Hon MICHAEL WOODHOUSE: More than a billion dollars if we require—as he has just told us—a modern fixed affordable source of heating a firebox or a heat pump. Well there's $2500 if you're lucky. We know from last year's bill when it was passed that the average cost of retrofitting insulation under the Residential Tenancies Amendment Act was going to be $3300. There will be some inflation on that so we're already talking about $6000 minimum per house times the several hundred thousand—we don't know how many. But the Minister has this flawed view that somehow if it was built pre-1978 that's going to be covered. But in fact that 1978 standard applied right through until 2001. So effectively what we're saying is that every rental dwelling built prior to 2002 is going to be required to upgrade.Now how many of those 600000 rental dwellings does one think as a proportion of those 600000 would have been built prior to 2001? Probably most of them yeah? Let's just say for argument's sake it's two-thirds of them. That's 400000 houses expending $6000 each—$2.4 billion. But that's OK because there's a grant—only there won't be for at least 250000 of them much less the owner-occupiers the Minister wants to help because there's just not enough money.So the concerns continue to remain that we are now leading towards this being a crushing imposition on the landlords and on the tenants because it's simply naive to suggest that the costs of the housing are not eventually reflected in the rental value. And it might not be just this but when you add this to ring-fencing to a capital gains tax and to the many other things that are going to be imposed on landlords as has been indicated by the Labour Government then that will lead to an increase in rents. The $87 million the Minister mentioned for Housing New Zealand to upgrade its stock is I think understated by half and then we haven't even got to the adjustments to the income-related rents and the accommodation supplement.But what's most disappointing about this is that we shouldn't be having to speculate on what those costs are. It behoves a responsible Government to actually have the answers to these questions and we don't.So I think we're at the end of a journey—a journey that the National Party supports the sentiment about but not the method of and therefore we will continue to oppose this bill—but we're also at the start of a journey: the start of a journey to better articulate where that effort should be put.Now the Residential Tenancies Amendment Act required the 180000 completely uninsulated homes to be insulated by 1 July 2019 and that's appropriate because the very good research done by the public health team at the University of Otago based in Wellington highlights the terrible failures of those houses but the focus is very much on completely uninsulated houses. Research by James Fricker—which I'm sure the Minister is familiar with—shows a dramatic decreasing benefit in thermal gain from the 1978 standard to the 2008 standard to the point where the marginal benefits are massively outweighed by the marginal costs of what the Minister proposes.He has said that he will have a comprehensive consultation process with landlords next year alongside other stakeholders and the public in designing the new standards. My hope and my wish for the Minister is for him to tone down the rhetoric and turn up the hearing on what will be a very important consultation process in order that we don't misalign that investment because if we are going to invest that much money in warmer drier safer homes let's do it in the houses that need it the most.Now we believe that the previous Government did that emphatically with the passage of the smoke alarms and insulation regulations after the Residential Tenancies Act. The Minister doesn't agree. That's fine. He's now in Government. He has the responsibility to deliver and be judged on that delivery. But I implore him to listen very carefully and to make sure that we target that investment in the areas where the most vulnerable people who we all want to protect will benefit the most."