Salesa JennyINFRASTRUCTURE FUNDING AND FINANCING BILLSecond ReadingHon JENNY SALESA (Minister for Building and Construction) on behalf of the Minister for Urban Development: I move That the Infrastructure Funding and Financing Bill be now read a second time. The Infrastructure Funding and Financing Bill provides the framework for a new funding and financing tool for bulk infrastructure that supports housing and urban development. This tool can be used by anyone whether they be a council a developer or Kāinga Ora. It demonstrates that this Government is tackling the issues that underpin New Zealand's housing affordability challenge.I would like to thank the Transport and Infrastructure Committee for its work on the bill and the organisations and members of the public who made written and oral submissions on the bill. I'd also like to acknowledge and thank the efforts of the Opposition who actually began this journey. It is great to see all sides of the House supporting this bill. I would like also to acknowledge the efforts and collaboration of the high-growth councils and Crown Infrastructure Partners who partnered with Treasury and the Department of Internal Affairs to develop this bill. The partnership signals a new way of working and I hope that councils and developers continue to engage in this way. The committee received 38 submissions representing individuals and organisations with interests in housing infrastructure financing the environment public health and local government. Of those who expressed a clear position on the bill 90 percent supported its broad intention and direction. Submitters generally noted that the bill will only support large infrastructure investments and that the bill lends itself toward new development areas. This is true. It is these areas where we tend to see financing constraints inhibiting investment in housing-related infrastructure. Nevertheless the bill is flexible to allow for the possibility of supporting brownfield development and infrastructure needs. Some concerns were also raised about transparency given the possibility of a private entity levying the public. I am pleased to see that the committee has sought to bolster these provisions in the bill by bringing a special purpose vehicle's (SPV's) activities within the ambit of the Official Information Act and the Ombudsmen Act to strengthen levels of accountability. This bill supports infrastructure projects that are economically viable. It allows them to proceed in environments where councils don't have enough debt headroom to deliver the project on their own and it does this by ring-fencing the financing eligible infrastructure from a local authority's balance sheet. The bill is not designed to crowd out local government. Instead it adds to their funding and financing tool kit. This is about creating partnerships between councils developers and the Crown to bring the infrastructure that our communities need. During the first reading the Minister for Infrastructure highlighted the funding and financing constraints that councils are facing on a daily basis. Auckland will use 90 percent of its debt capacity over the next decade. Hamilton will use 86 percent over the same period. COVID-19 has exacerbated these debt constraints. With council revenues expected to fall as they grapple with the economic consequences and help their communities with rate deferrals and other support it has become even more critical to address some of the funding and financing challenges today. By mitigating financing constraints on the infrastructure decision-making process this bill will assist with the funding and financing of critical infrastructure projects to provide the homes that New Zealanders need much sooner than would otherwise be possible. While we do face tough economic challenges ahead we mustn't forget the long-term outcomes that this Government hopes the bill will achieve. By overcoming technical financing constraints and speeding up the provision of housing-related infrastructure we are tackling one of the fundamental problems that is driving up house prices: a lack of serviced urban land. Increased land and development capacity available for housing will support a more competitive urban land market ultimately helping to bring down the cost of urban land. The bipartisan support seen in this House on this bill's introduction and general support from submitters in local government sends a strong signal that resolving local government funding and financing challenges is a priority that is something we can all be proud of. Now turning to the committee's work they have made a number of useful changes in response to the submissions. Transparency and accountability are going to be critical to gaining support from the public councils and the wider sector for the underlying model. I've already mentioned that the bill now includes provisions to bring SPVs within the ambit of the Official Information Act and Ombudsmen Act. The committee has also identified other opportunities to bolster these provisions and made changes to protect the legitimate interests of landowners and councils when it comes to infrastructure endorsements and construction powers provided to SPVs. I welcome and support these changes.One small but key amendment was made in response to submitters to ensure that the infrastructure and levy endorsements from local authorities and consents to include protected Māori land within a levy area are all required before the levy order can be recommended. This was always the intention but required a slight tweak to avoid any doubt. The endorsement requirement is a fundamental part of the levy proposal process. It makes sure that local authorities who will ultimately own and operate the infrastructure once constructed are satisfied with the quality and technical aspects of the infrastructure. Some council submissions highlighted that it was not clear that the costs of acquiring land to provide infrastructure could be covered by a levy. These costs make up a significant portion of infrastructure investment. In some cases they can exceed a third of the total construction cost. The committee has helpfully ensured that the bill is explicit that land acquisition costs are eligible for establishment costs to be recovered via a levy. The committee has also made a number of technical adjustments to ensure that the bill operates as intended and interacts well with local government practice and key legislation such as the Local Government Act 2002 and the Local Government (Rating) Act 2002. I want to touch briefly on one area where submitters made comment but the committee has not sought any changes. A number of the submitters sought an expanded scope for the bill or wanted it to be altered to become a general local government financing tool. The bill arises from the Government's urban growth agenda thus does have a deliberate focus on supporting housing-related infrastructure. As such it creates processes for and obligations on councils and SPVs around this purpose. What the bill does do which goes some way towards some of the submitters' comments is provide for the model and underlying commercial structures to evolve over time. It only prescribes processes necessary to protect levy payers local authorities and the Crown. The methods used to identify and develop projects remain unprescribed. However Crown Infrastructure Partners are the Crown's agent to help facilitate use of this bill should it be passed into law. This will encourage a continued partnership approach between councils developers and the Crown to help provide the infrastructure needed to support housing for our communities something which has historically been a rare occurrence but is critical to the successful provision funding and financing of infrastructure. Overall the changes recommended by the committee improve the bill provide additional transparency and support its objectives. I thank the committee for their consideration of the bill. The bill is stronger because of these collaborative efforts from across the House. I move that the House take note of the committee's report and I commend this bill to the House. Thank you Mr Speaker.