Bayly AndrewANDREW BAYLY (National—Hunua): Thank you Madam Assistant Speaker. It's a pleasure to be talking on the Overseas Investment Amendment Bill. What a divisive issue this has been. I like a number of us in the House have sat on the Finance and Expenditure Committee which received 213 submissions and heard 63 of them in both Auckland and Wellington. I've got to say that it was almost an embarrassment actually being a member of the Finance and Expenditure Committee during the period that we heard submissions on this bill. I think it's best characterised as one of those feel-good bills that parties like New Zealand First like to promote because it sort of appeals to the general public—yes we're going to stop foreigners coming in and buying our assets. Then on the other side having little regard to what that actually means and what the implications are. In life it's always a balance and I think unfortunately we've ended up with a very poor balance.Obviously what we've heard is that this bill is about seeking to place limitations on overseas persons from acquiring basically residential land and characterising it as sensitive land". There are three ways that they can obtain consent—I'm talking about overseas investors. Those are: if they are in the business of buying the land and adding to New Zealand's housing supply i.e. they buy the land sit on it develop it and then flog it; if they want to use the land for non-residential purposes or residential purposes relating to core business i.e. it's a business you acquire which happens to have some residential land and a case in point was telecommunications companies which were initially precluded or residential retirement village - type companies; or the third one if they hold an appropriate visa and could show they had committed to reside in New Zealand. And the big issue was in allowing overseas persons to acquire residential land for the purpose of supply of housing.We've heard from a number of people that the way the bill has been written it has had a chilling impact on new developments already even though the bill is still not even enacted. And it raised the question in the committee about what sort of land an overseas buyer might buy. So is it a residential piece of land; is it land deemed rural-residential which is on the outskirts of—for instance in Auckland—my electorate; or is it rural land that could be bought and then subsequently re-consented and actually used to build property? The question is: if you're an overseas person over what time period can you buy this land and over what time period can you hold it? Can you be a land banker for a long long period of time—which is actually the issue around property development? If you wanted people to develop property and if they're overseas people—if you really wanted them to develop property—you would have put time pressure on those foreigners—ASSISTANT SPEAKER (Poto Williams): Order! Order! I've let the member go on a bit but please don't bring me into the debate.ANDREW BAYLY: But this bill had nothing of that. The bill was silent on that and still allows for overseas persons to actually land bank and that's one of the core reasons for why we've got a lack of supply in housing.One of their changes was an exemption if the overseas person is buying it—if you are buying and building a multi-storey apartment. So the rule that was subsequently announced during the course of the hearings and the committee's work was that if you're an overseas person if you're building a multi-storeyed apartment with more than 20 units you could offer some of those—ASSISTANT SPEAKER (Poto Williams): Again I just remind the member the use of the word "you" brings the Speaker into the discussion. So if you could just not do that that would be great.ANDREW BAYLY: Thank you Madam Assistant Speaker. So the developer the overseas person could sell those off the plan to overseas people and up to 60 percent—and we didn't get clarity around that whether that was 60 percent but we believe it could be—of the units could be sold to overseas people. There were some exemptions around that: rented share equity schemes—whatever. But effectively what that allows is apartments to still be built and sold to overseas people.What this raised was the issue around who might actually rent those properties or enter into long-term arrangements. The rules around it are that they must be subject to a market rent on a proper basis. And of course one of the things—and I think this is where the biggest hole is in this bill when it becomes an Act—is that a foreign person could develop apartments then sell them to a family member under a market rent situation and therefore still have control of that and still achieve the same outcome. That issue was never actually resolved within the committee. I think it's the one that cuts through and actually undermines the case of this bill. If you were to actually be clear about it you would have actually put a dent in that if you were trying to stop foreigners coming in and buying apartments.There were similar exemptions for hotel units. One of the things we've asked—you know with all these sorts of complex arrangements where foreigners are allowed to do these developments and then have to sell them within a certain time period and foreigners are allowed to buy these units—is how on earth do you monitor that? We spent a lot of time with the Overseas Investment Office (OIO) asking that very question. As my colleague Ian McKelvie noted before at the moment the OIO do only a very very small number of consents—about 150 but now they're probably estimating they're going to have to process about 4000 a year. That is a phenomenal increase and the whole issue about the resourcing of the OIO is incredibly one that we could not get a view on. We were told that they were going to have some additional people but it is a big issue and it's a complex issue. It's not only at the time that these original arrangements come into place but because they have transitional arrangements later on how on earth is the OIO going to continue to monitor these types of arrangements and property and rental arrangements to make sure they comply with this bill?There was a step change during the bill. I've spoken about it. Previously the bill envisaged that power and gas companies and telcos who often have a requirement to buy residential properties for their own operations were all going to be excluded. Only through the process did the Minister put in place a new change to give a dispensation to those groups but ruled out a dispensation for retirement homes because in many cases our largest retirement homes are owned more than 25 percent by overseas parties merely because they're listed on the stock exchange. There was no real reason why they were actually precluded.The one that really worked us up as a committee was around forestry rights. As my colleague the Hon Amy Adams noted before 72 percent of the forestry rights in New Zealand are already owned by foreigners; yet we have a Government who says that's not enough and actually sets about dismantling and making it easier and setting in place three easier steps for foreign forestry people to come in here and buy more of our forests. There is no justification for why we should allow more foreigners to own more than 72 percent of our forests. I heard the argument about trying to achieve our billion-dollar budget of new trees but of course New Zealanders should be doing that. That's New Zealand stuff. Why on earth would New Zealand First support foreigners increasing their share of forests in New Zealand? I absolutely cannot understand it. On the other side we've got a viable vineyard winery business in New Zealand—highly successful. Do you think there are any such dispensations for that? Not one jolt—not one jolt.Some of the other issues were around the conveyancing of it. The conveyancing rules were actually very significant for people who had to do that and through the work of the committee we reduced some of the liability so that now there's an obligation on the purchaser to provide a statement which the conveyancer merely has to note and pass on. But the liability for making any false claims now sits with the foreign overseas party. Now that's another issue with the Overseas Investment Office. How is it going to monitor that? How is it going to check it given the significant scale of 4000 consents a year? I do not support this—ASSISTANT SPEAKER (Poto Williams): Order! I apologise to the member. Your time has expired."