Social Housing Reform (Transaction Mandate) Bill — First ReadingText is incorporated into the Bound VolumeSocial Housing Reform (Transaction Mandate) Bill — First Reading[Sitting date: 18 August 2015. Volume:707;Page:5893. Text is incorporated into the Bound Volume.]Social Housing Reform (Transaction Mandate) BillFirst ReadingHon PAULA BENNETT (Minister for Social Housing): I move That the Social Housing Reform (Transaction Mandate) Bill be now read a first time. I nominate the Social Services Committee to consider this bill. This Government is continuing its commitment to improve the social housing system to support more vulnerable New Zealanders with the Social Housing Reform (Transaction Mandate) Bill.This bill achieves three things. It authorises designated Ministers to enter into social housing reform transactions in the name of Housing New Zealand Corporation and its subsidiaries. It clarifies that the Public Works Act 1981 offer-back provisions do not apply to land held by Housing New Zealand Ltd. It also preserves this treatment for designated Ministers so that just as the offer-back provisions do not apply and have never applied to land held by Housing New Zealand Ltd they do not apply to Ministers acting in Housing New Zealand’s name. The bill confirms the Crown’s authority to administer Crown land that is held under the Housing Act 1955.The primary purpose of this bill is to enable the Social Housing Reform Programme to progress. The bill is needed firstly to provide Ministers with statutory authority to undertake the transfer of Housing New Zealand properties to community housing providers; and secondly to provide Housing New Zealand with the statutory mandate to support the transfers. Housing New Zealand’s guiding legislation evolved to fit the existing social housing system and this Government has decided that the existing social housing system is not best serving the needs of vulnerable New Zealanders.The objectives of the Social Housing Reform Programme are firstly to ensure that people who need housing support can access it and receive social housing services that meet their needs; secondly ensure that social housing is of the right size configuration and quality and in the right areas for those households that need it; thirdly help social housing tenants to independence as appropriate; fourthly encourage and develop a more diverse ownership of social housing with more innovation and responsiveness to its tenants and its communities; and fifthly help increase the supply of affordable housing especially in Auckland.Legislative changes support these objectives and in particular the fourth objective to encourage and develop a more diverse ownership of social housing with more innovation and responsiveness to tenants and communities. The Social Housing Reform Programme includes the transfer of Housing New Zealand houses to community housing providers to support the development of the community housing sector.The proposed initial transactions involve the transfer of 1000 to 2000 Housing New Zealand houses to registered community housing providers. The transactions process is new both for the Government in terms of transferring substantial numbers of social houses and of course for those community housing providers. Consequently the process is proceeding in a measured way so that potential participants have the opportunity to prepare. This bill supports the programme by amending the Housing Corporation Act 1974 to provide designated Ministers with the authority to transfer Housing New Zealand Corporation properties. Designated Ministers will be able to do this by entering into contracts and performing other acts in the name of Housing New Zealand.Along with transferring properties the bill enables the designated Ministers to enter into contracts to ensure that Housing New Zealand provides transitional services to transferees to ensure that tenants’ needs are looked after during any transfer process. We will ensure that transaction processes work smoothly for current tenants. There are safeguards in the process. Following the exercise of the transaction mandate Ministers are required to publicly notify the general nature and purpose of its use by means of a statement published in the Gazette and presented to the House of Representatives. This provides transparency allowing Parliament and the public to see that its exercise is consistent with the purposes outlined in the legislation.The offer-back provisions set out in the Public Works Act 1981 do not apply to land held by Housing New Zealand and the bill ensures this position is carried forward by amending the Housing Restructuring and Tenancy Matters Act 1992. This amendment ensures that Ministers’ use of the transaction mandate to transfer properties on behalf of Housing New Zealand does not raise any doubts about whether the Public Works Act applies.It is important to provide certainty on this point to avoid delay to the social housing reform process. This amendment does not alter any existing rights as it confirms the current legal position that the offer-back regime does not apply. If there are rights of a first refusal for iwi in relation to Housing New Zealand Corporation properties under Treaty settlement legislation these legal interests are preserved after these changes. We are going through a thorough process to deal with these.The final aspect of this bill is an amendment to the Housing Act 1955 to clear up a longstanding issue not directly related to the social housing programme. This amendment is a technical amendment that gives a designated Minister the exclusive power to administer State housing land that is identified by the Minister in a Gazette notice. State housing land is land that is owned by the Crown and is set aside under the Housing Act. Some of this land is managed by Housing New Zealand on behalf of the Crown and some is managed by the Crown itself.The Crown and Housing New Zealand agree that the Crown should have the authority to transact State housing land that Housing New Zealand does not manage but the legislation setting out this authority is unclear. This bill clears up that matter. This amendment does not apply to land that is owned by Housing New Zealand. This Government remains committed to improving the lives of tenants in social housing and this bill supports that objective. I commend this bill to the House.PHIL TWYFORD (Labour—Te Atatū): Labour opposes this bill. We will not be voting for it. It gives Minister Bennett and Minister English extraordinary powers to sell State houses to personally negotiate contracts “on any terms and conditions” that the Ministers wish and to take any action to facilitate the sales process. It allows the Ministers the power to sell off State houses without any reference to Housing New Zealand’s board its chief executive or its legislation. The bill will exempt the Ministers from all relevant enactments including the objectives and functions of Housing New Zealand for example social responsibility environmental responsibility and good financial oversight—things that clearly the Ministers do not want to be bound by. The Ministers are not constrained by “any rule of law to the contrary relating to capacity or validity of acts.” It also exempts the Ministers from any legal challenge except judicial review.These provisions especially given this Government’s track record should be ringing alarm bells loud and clear. National wants the freedom to do dirty deals flogging off billions of dollars’ worth of publicly owned land and housing. It does not want to be bothered by pesky public servants or the rule of law. We know that the Government is currently having secret meetings with merchant bankers public-private partnership investors and property developers who want to get their hands on these valuable public assets. The Government refuses to release the details about whom it is meeting to discuss the sales with.This bill is the latest move by a Government that is desperate to offload State houses and keep this troubled and deeply unpopular policy afloat. If people needed any reminding of this Government’s propensity to blur the ethical lines in its governance let me remind people about a story that appeared on 6 June in New Zealand Herald about the fact that Housing New Zealand Corporation paid $1.6 million to Andrew Body a public-private partnership investment consultant to help it sell State houses. First what did the Government do? It engaged Mr Body to help it develop the policy to sell State houses through the Housing Shareholders’ Advisory Group and then later on an advisory panel to help form Government policy on social housing.Part-way through those appointments Housing New Zealand contracted Andrew Body to conduct work in the asset transfer work stream. So having developed the policy it then hired Andrew Body to help it move ahead with selling the houses even though he was already working for an international public-private partnership investor. When Housing New Zealand was asked about this apparent conflict of interest it hid the information and refused to release it publicly under the Official Information Act. It took the Ministry of Business Innovation and Employment which was caught out telling the truth to respond to an Official Information Act request by releasing the information that made it very clear that there was on the face of it a clear conflict of interest in the engagement of Andrew Bodyin this work.Andrew Body was paid $1.6 million by this Government in a series of contracts to develop the policy and then advise it on selling off State houses. There was a clear conflict of interest and Housing New Zealand hid it from the public. This State house sell-off policy of Bill English is deeply unpopular and the most recent opinion poll showed that 75 percent of New Zealanders—and actually 60 percent of National Party voters—oppose the sale of State houses to the Gold Coast company Horizon Housing which is interested in picking up these State houses. It is a deeply unpopular policy. But no wonder—this Government has allowed itself to be diddled by Rio Tinto in relation to Tīwai Point by Warner Bros by Skycity and by Saudi businessman Hamood Al Ali Khalaf. What a roll-call of shame. This Government has incredible commercial acumen—what fantastic deals it does on behalf of the New Zealand taxpayer!Given this record of negotiating bum deals for New Zealand it is a bit of a worry that Minister English and Minister Bennett are basicallyasking with this bill for a free rein to hock off billions of dollars worth of publicly owned land and housing. Not only is this Government an utterly incompetent commercial negotiator but it has brought the ethics of Wall Street into the Government at the highest levels. The Saudi sheep scandal has shown that it is willing to blow millions of dollars of taxpayers’ money on dubious schemes and then lie to cover its tracks. Now Paula Bennett and Bill English want the unfettered power to flog off billions of dollars of land and housing to their Cabinet club mates. This is sickening and Labour will be opposing this bill.Bill English may want his political legacy to be the sale of thousands of State houses to property developers merchant bankers and overseas companies but it is time he let this policy go. New Zealanders want State housing to be there to guarantee a decent roof over the heads of the most vulnerable families just like the Prime Minister and his mother enjoyed in the 1960s when Kiwi taxpayers gave them a decent roof over their heads. It gave the Prime Minister a start in life that benefited him but apparently according to the National Party that is no longer good enough for New Zealanders in the 21st century.This policy has been a dog since the word go. First National said it was building up local community housing providers and that is why it wanted to transfer State housing. But now Paula Bennett and Bill English say they want to sell State houses to only large organisations that can spend tens of millions of dollars and buy hundreds of houses in one go effectively eliminating the entire New Zealand community housingsector from the whole process. It makes a mockery of what they said.Bill English said that the Salvation Army was lining up to buy these houses and if it was not the Sallies it would be iwi. Well the Salvation Army made it very clear that it did not believe that this policy would benefit tenants and it ruled itself out of buying these houses. Iwi leaders said that they would buy these houses only if they got them for nothing. Meanwhile the National Party said that these houses would go only to non-profit groups. That is what Paula Bennett said. But as soon as the Salvation Army pulled the plug on this deal Bill English was forced to concede that actually banks and property developers would be in on the game as well.National has said—and I think Paula Bennett just said something similar in her contribution tonight—that community groups would do a better job than Housing New Zealand. National has said that somehow people in the local community and voluntary sector would understand the needs of social housing tenants better than Housing New Zealand. Now apparently the Government is talking to organisations in Australia who are somehow going to understand the needs of State housing tenants in Invercargill Palmerston North Timaru Wanganui—the Australians are going to be able to do a better job than New Zealanders. Well how does that work? How does that work?This Government is yet to provide a scrap of evidence that the people to whom it is intending to flog off State houses will do a better job of looking after State house tenants than Housing New Zealand can. We asked Paula Bennett under the Official Information Act for the data. We asked her for the evidence. What is the evidence base of this policy in the lines that the Minister is trotting out to justify hocking off billions of dollars of State houses? The answer that came back from Paula Bennett’s office was that there is no such evidence. That says it all.This bill puts Minister Bennett and Minister English above the law. There is a very good reason why Ministers are subject to the rule of law and to all the normal legal and constitutional provisions which put checks and balances around them especially when those Ministers are conducting negotiations to sell off huge public assets that have been paid for by generations of New Zealanders. There is a good reason for that. This bill leaves the process wide open to corruption. This Government should take that seriously. There are reasons why those provisions are there. They should not be cleared away.MATT DOOCEY (National—Waimakariri): It is a pleasure to rise to speak at the first reading of the Social Housing Reform (Transaction Mandate) Bill. I do not believe for one second that that member Phil Twyford actually believes in what he just said. Can I quote Mr Twyford? Mr Twyford said: “Tenants with high and complex needs may be better off being transferred to a community housing provider …”. I do not believe for a second that the member Phil Twyford believes in what he just said. Mr Twyford said: “What does this bill do? It shifts housing stock out of the hands of Housing New Zealand into the community housing sector. This is something that … Labour is perfectly comfortable with …”. So it was all right back then you were comfortable with it then but not now.If I can I would like to go back to that period up to the election in 2014 to think about the pledges that the parties gave in campaigning and to think about the mandate this Government has with this policy around social housing. If we look at our National Party pledges the first one was to free up land for new sections. I know that in my electorate we have done exactly that. With the Land Use Recovery Plan we have been able to free up land which has increased supply which has equalled demand. When you look at statistics like annual house price inflation New Zealand has 7.5 percent Canterbury has 5.5 percent and “Waimak” has 3.5 percent. We are the third-biggest district in the South Island—we have just overtaken Invercargill—and we are the third fastest - growing electorate by population yet we have only 3.5 percent annual house price inflation. That is because like I am referring to our housing policy going into the election was about freeing up land for new sections.The next pledge was about keeping interest rates low. We know that we have some of the lowest interest rates in 50 years.Tracey Martin: What’s that got to do with State housing?MATT DOOCEY: Well I am getting to that. I am getting to that. The third pledge was about introducing the KiwiSaver HomeStart package which we have done. That is three out of three.Tracey Martin: State housing?MATT DOOCEY: Stay with me—three out of three. And here we move into the fourth pledge: to reform the social housing sector facilitating a shift from State housing to a range of new social housing providers. We pledged our housing portfolio and our promises we got the mandate from the New Zealand people at the last general election we are sticking with it and we are delivering it unlike Mr Twyford who says what he wants and then backtracks on it. What we have done is we have clearly set out that path at the election and at the first opportunity that we have had to deliver it in Budget 2015 that is exactly what we have delivered: social housing reforms. The reforms allowed an extra 3500 New Zealanders to gain access to housing and provided extra wraparound services for vulnerable Kiwis who will get extra support around education training employment mental health and alcohol and drugs to support them into independence on top of the Support for Children in Hardship Bill. The list goes on because what we have done is we have stuck with our promises. The people of New Zealand trust us and have confidence in us to deliver what is right for the people and that is exactly what we are doing because we listen to people we care for them and we are the working peoples’ party.When you look at statistics from Housing New Zealand at the moment when you look at one-bedroom houses there is a 25 percent demand with only a 9 percent supply—25 percent demand; 9 percent supply. When you look at three-bedroom houses there is a 24 percent demand with 43 percent supply. You can see where there are big houses there is only a small number of people in them and the housing is not meeting the demand. It is about the right house for the right people at the right time in the right location. That is what we are working towards—a systemic approach.If those members talk about housing they may want to talk about the Red Army. They are not talking about the Chinese and they are not even talking about the Canadians. It is the reds under the bed. They go to bed every night holding their copies of the Communist Manifesto by Karl Marx under their pillows dreaming of the 1950s the 1960s the 1970s and of State intervention. They are going to bed with great dreams of State intervention as if they have forgotten about the revolution of the liberal market economy. That is where we are. We are in a mixed economy of care—a mixed economy of care where we have private provision Government provision community provision and NGO provision. It is flexible and it gives people choice because what we do on this side of the House is we back communities. We believe in big communities and to all those innovative community organisations: we believe in you. We are here to support you and the aspiration you provide for your tenants to give them vision and to give them hope.The Social Housing Reform Programme—when you look at some of the statistics 3650 people assessed as high needs are waiting to be on the list for social housing. It is not working. Things had to change and it is right that they are. I am proud that I am part of a Government that is sticking up for people and putting people first. That is what this is about. Thirteen hundred tenants from Housing New Zealand have applied to transfer to better houses that suit their needs. A third of Housing New Zealand properties are in the wrong place and are the wrong size. The tenants are becoming more complex. A third of them are sole parent families with children. Over 20 percent are over 65 years old. What we need to do is think through with community housing providers about how they provide new innovative ways to support the complex needs of their tenants.What we know is that we will be looking to transfer 1500 houses with existing tenants and tenancies as part of this mandated bill. When we look at the regulatory impact statement it outlines clearly two options. Option one is to ensure that the Crown has the authority to transact Housing New Zealand Corporation’s stock by means of a new asset transfer provision. The preferred legal mechanism is a transaction mandate. That is exactly what this bill is about: a transactional mandate. Option two is to commence the programme underneath the existing legislative framework of Housing New Zealand. The regulatory impact statement came back for this bill about the transactional mandate and said: “There is no or minor impact on tenants as a result of selecting one option … Option one provides benefits to potential bidders as it provides certainty that the transfers can proceed.” It showed that if we had gone for the impact analysis on option two it would not have worked.What we know is that at the end of the day the Social Housing Reform Programme has a range of objectives. The first objective is ensuring that people who need housing support can access it and receive social housing services that meet their needs. I have already talked about the statistics of the range of bedroom numbers that are not meeting the needs of the people on the waiting list. It is also about those people who need wraparound services: employment training and education. What we are trying to do is move people into independence. We know people benefit from being independent. They become productive members of society. It is not only about getting them into employment; it is about getting them into independent housing. It is a great bill and I commend it to the House. Thank you.CARMEL SEPULONI (Labour—Kelston): I just want to pick up on a couple of things that Matt Doocey said. Firstly he was saying that my colleague Mr Twyford does not believe a word of what he was saying. Well I can tell Mr Doocey he does because he was in charge of writing the notes and everything that was written down is what he believes unlike that speaker who was reading from a piece of paper and who knew nothing about what he was talking about.Secondly I just want to say that the other thing that Matt Doocey said was that we on this side of the House are communists for opposing this bill. Well can I just say that he must then be accusing the 75 percent of New Zealanders who disagree with the selling off of State houses. He must be saying they are also communists. I am not sure about how the 75 percent of those New Zealanders feel and actually 60 percent of National voters oppose the Government’s plan to sell off State houses. So 60 percent of National voters according to Matt Doocey are communists as well.I think it is very clear from what I am already saying that we oppose this bill. Our biggest concern here is that this bill gives Ministers English and Bennett extraordinary powers to take direct personal control of selling State houses exempting Ministers from normal legal requirements and leaving the sale process wide open for corruption. New Zealanders have a real interest in what is going on here. So of course we are not going to support the idea that those two Ministers be given extraordinary powers to make decisions without consulting or going through the normal process.I want to just take this back to my own electorate and say that the No. 1 issue coming through my office doors—and I am sure this is the same for every electorate MP in this room—is housing. Firstly for that Government to say that we do not have a housing crisis in this country is absolute rubbish and it knows it. Secondly we cannot pretend that State housing is not part of the solution here. What I have been really disappointed in is the fact that that Government has been so negligent that in order to meet its own ideological philosophical aspirations—which is: do not own these houses because it does not believe that the State should have a role in this—it would allow these houses to continually become more and more run down under its watch to the point where we have public cases in the media where the coroner is stating that the No. 1 reason for the deaths of children is actually the housing that they are living in. That Government is responsible for that.So here we are looking at a piece of legislation that will enable the National Government to sell off our State housing but in the lead-up to this it has been doing everything that it can to make it look like the State cannot manage the housing that it has. It has been deliberately doing a bad job of managing the housing that we have so that it adds weight to its case and so that it can look like it is justified in selling it off. No one can do a better job of providing housing for New Zealanders who need it—the most vulnerable who need it—than New Zealandersactually. So the fact that the Government is even looking at selling off these houses to Australians has everyone in this country rolling their eyes shaking their heads and shrugging their shoulders because how can Australians look after our most vulnerable take over our Housing New Zealand stock and do a better job than we can? It is an indictment on that Government that there have been so many cases in the media recently about the state of the Housing New Zealand stock that we do have.I want to talk about a couple of cases in my own electorate that are actually that Government’s responsibility to do something about and it has done nothing. There is a case where we have a young boy who is 10 years old and has a disability. He cannot get inside or outside of his house without being carried by his parents. The house cannot be modified because of the way it is and the land that it is on. They cannot get a transfer despite the fact that we have been supporting them to get one because there is not enough stock—they cannot get a transfer. That child now has to be home schooled because the mother cannot carry that kid inside and outside the house every day. That is what happens when we do not have the Housing New Zealand stock that is required.There are thousands—and I have seen this through my own Official Information Act requests—of New Zealanders every month applying for Housing New Zealand houses but how many of them are making it on to the Housing New Zealand waiting list? Less than one-fifth of them are actually making it on to that list. Are they applying despite the fact that they do not need it? Are they applying even though they do not need it?Sue Moroney: No.CARMEL SEPULONI: No. They need it. It is not a case of people going: “Oh where can I get an easy deal? I’m going to put my name forward for a Housing New Zealand house.” They actually need it but less than one-fifth of them are actually getting on to the Housing New Zealand waiting list. That Government is trying to make out that there is not that much of a demand but we know that the number of people who are applying is not equating to the number of people who are on the list.In recent months we have seen examples of where the Government has actually had the opportunity to pick up more houses but it has chosen not to. One of those examples was in the Waterview area where a number of Housing New Zealand houses were purchased for the Waterview Connection which we support but were then no longer required. So 31 of those houses were no longer required for the project and who then had the first right to purchase those houses? Housing New Zealand could have purchased them back but despite the fact there are thousands of New Zealanders wanting Housing New Zealand houses and trying to get their names on to the list did Housing New Zealand take up that opportunity to purchase those houses back? No it did not—it did not. It allowed them to go out for private sale despite the fact that Government members—Nick Smith and everyone else—are constantly talking in the House about the fact that they are doing whatever they can to be part of ensuring that they are meeting the housing demand. Well actually they are not. They want it to go private. They want to have no hand in this whatsoever.And do you know what? It is history repeating itself. So many New Zealanders have forgotten this and we have to keep reminding them of it: the National Government sold thousands of Housing New Zealand houses back in the 1990s. Then when Labour got into Government in 1999 the first thing it had to do was try to rebuild that stock. In the process there were a whole lot of houses that were run down as well. We had 9 years to try to rebuild the stock and try to fix up those houses and maybe we did not get to the point where we could have or we wanted to get to but we did actually try to rebuild that stock.And now here we are in that same predicament with a National Government that has not learnt from its mistakes and has not changed its ideology in any way. Here we are—history is repeating itself and the Government is selling off Housing New Zealand houses again. Then what is going to happen is that when National’s time is up and New Zealanders decide that actually they have had enough of a National Government and what that means for this country and Labour gets back in with whichever coalition partners we have at that time—what are we going to have to do? We are going to have to rebuild that stock and then try to do some work around the maintenance of our Housing New Zealand houses that have been neglected by the National Government.Selling off our Housing New Zealand houses is not the answer to the housing crisis that we have at the moment. I think that actually the National Government—all of its backbench MPs all of its Ministers—should be embarrassed about what it is doing. We have a major housing crisis in this country and it is not just about those who cannot afford to buy houses. It is about those who cannot afford to even rent a house. It is about those who cannot afford to get out of the garage that they are living in because they do not have enough money to rent a house. They cannot afford to get out of the car that they are living in because they cannot afford to rent a house. Yet that National Government would rather sell off the Housing New Zealand stock that we have and take away one of the few opportunities that New Zealanders have to get into affordable housing. I think the Government should be ashamed of itself and we will not be supporting this bill.ALFRED NGARO (National): It is a privilege to stand and speak on the Social Housing Reform (Transaction Mandate) Bill in its first reading. I think that the previous speaker Carmel Sepuloni probably needs to do a little bit more homework before she actually launches off in her speech. Here is just a little bit of a history lesson right? Let us take the housing stock out in Glen Innes for instance. We are out there working in Glen Innes—that is right; there is a little bit silence of the lambs at the moment—and here is the evidence that shows that right? So we could talk about the rhetoric but let us talk about the facts of what actually happened.Out in Glen Innes there are around about 2500 State houses. The stock of houses in that area of Glen Innes was some of the worst and under the Labour Government the previous Government in 9 years not once did they go out to repair to maintain or even to rebuild the housing stock there.Kris Faafoi: Oh that’s rubbish.ALFRED NGARO: No it is not rubbish; it is actual fact. Why do I tell you this? You can talk to guys like Pat Snedden who are part of the Tāmaki Transformation Programme which actually started in 2007. It was an idea that came to fruition in 2008—set up under Helen Clark. At that time also Pat Snedden was helping to head that project. I as a community representative came along and actually gave some commentary around how they could engage with communities. So it is not rubbish; it is actual fact.It started under the Labour Government. Glen Innes was the worst stock of repairs and maintenance of any State housing in the whole of New Zealand. So before that member launches off and talks about the shameful record she needs to go back and have a look at her own party’s history because then she will see that under the Labour Government not once in 9 years did it actually rebuild that stock.So let us talk about what we are doing here. What we are doing here is this: we are taking the opportunity to be able to engage in the social housing sector. This bill is called the Social Housing Reform (Transaction Mandate) Bill.Kris Faafoi: You’re just selling them. Just say it.ALFRED NGARO: We call it transaction mandate. Let us use another word that maybe even Kris Faafoi may have heard. It is called the devolution of stock OK? Where did that word come from? Let us use the word “devolution”. Why? I know you will know that because when the Hon Steve Maharey was the Minister for Social Development he set up a thing called the Care and Protection Blueprint and I just happened to be part of that committee. On the Blueprint committee—that is right Mr Deputy Speaker I know you are attentively listening to this—Mr DEPUTY SPEAKER: Do not bring me into it.ALFRED NGARO: In the Blueprint the conversation that was there was in fact this: do we trust the social sector to actually provide services that as a Government we cannot provide in regard to extended and extra services that are above and beyond our core services as a Government? The answer was yes we should do that.So devolution both in terms of housing stock and in the delivery of services was talked about way back then. We put together what was called a “blueprint plan”. That plan went to Cabinet and here is the one reason it did not go all the way. It was because the mandate was not given by Cabinet at that time under the Labour Government to trust in the socialsector to provide services that it could not provide. In other words they were not given the mandate. They were not given the mandate. So there you go. There is a little bit of a history lesson for you.Kris Faafoi: Here’s a history lesson: you’re selling the houses.ALFRED NGARO: So here is the reason why this bill is a point of difference Mr Faafoi. This bill is a point of difference because it simply does this: it says that actually we trust our social services. We trust the Housing Foundation with Brian Donnelly. We trust Habitat for Humanity. We trust VisionWest Community Trust and Lisa Woolley. Why? Because they deliver above and beyond what we are able to deliver. These are social services that have actually said to us: “Actually give us the opportunity to prove that we can do this.”So I think actually what this bill does is it shows that not only it is giving a statutory mandate to our Ministers but it is forming a relationship of trust in our social services and especially in the social housing sector the third sector to provide these services that are much needed in our communities. So we know what this does first and foremost.There are some issues of concern. I want to raise them because they have come out in some of the speeches and they are in regard to the relationships with iwi. We know there has been talk about that. It is important to note that in this bill it does not in any way change the first right of refusal rights that iwi may have over some Housing New Zealand properties. We know there has been some concern that is there.Denis O’Rourke: That’s not what it says.ALFRED NGARO: It is in the bill. We are keen to make sure that that relationship is maintained. We are working through a thorough process with iwi in Tauranga and in Invercargill to establish what rights and interests they have and we will deal with them in good faith. So that is one of the areas first and foremost.Denis O’Rourke: Get it right. He hasn’t got that right.ALFRED NGARO: We want to make sure just in case because on the Opposition—and unfortunately even with Mr O’Rourke—there is what we would call the manufacturing of crisis. It is all doom and gloom. It is only about the things that could go wrong not about the things that could go right which is what this Government is about.Let us talk about some other issues. This bill does not apply to Crown land. It only relates to land owned by Housing New Zealand. There was some concern that was raised there. No one’s rights under the Public Works Act are changing. The bill simply clarifies that the offer-back provisions of the Public Works Act have never applied to Housing New Zealand property. Again we want to sort of dispel the myths of doom and gloom that are coming from the Opposition as well.So what are the things that we think are really important in regard to the social housing issues? What are some of the achievements? While we talk about what the bill is doing let us look at some of the things that we have achieved so far in social housing. In June 2015 quarterly social housing register figures showed that the number of people on the register has decreased. That is right—by 1299 from the June 2014 quarter to 4541. That is a 22 percent decrease. I know that members of the public who are listening out there may want to hear these facts and figures. It is a 22 percent decrease.The Ministry of Social Development Housing New Zealand and the community housing providers are more intensively working to match people to houses that suit their needs. Here is that point of difference: we know that core services by the Government are what we are responsible for but where we go above and beyond—and this is that relationship of trust that is formed with social housing providers in which they can provide that.So it is important that we are matching people to houses that suit their needs and in fact maybe even as the previous speaker Mrs Sepuloni talked about the needs of those who potentially have disabilities. Social housing providers that have a particular niche are able to provide for those specific needs as well. And so the number of housing offers made and accepted increased to 1590 in the June 2015 quarter compared with 1522 in the June 2014 quarter as well.Let us talk about the tenancy reviews of those who are paying market rent and who are able to sustain private accommodation. They make more homes available for those who are more in need. I have seen this for myself. It is a really challenging space because it is almost as if the rhetoric that is being championed by the Opposition—Kris Faafoi: Don’t go there.ALFRED NGARO: —is “a State house for life”. I will go there because that is what I hear. It is almost like “a State house for life” you know? There is that sense of entitlement that they build into the houses and into the homes and even into the hearts of people who are in our communities.What we are saying is this: a State house is a provision for need in the circumstances that a family or an individual may find themselves in. But our belief is this—our belief which we will champion on this side is to help people to a sense of independence so that they can be self-determining in their future and for their families as well. So that is why we think it is important.From tenancy reviews of those paying market rent who are able to sustain private accommodation and from over 150 households who have moved into private market rents 11 tenants have purchased their own homes. That may not sound like much Mr O’Rourke but 11 tenants—we think actually there are 11 lives and 11 families who have been changed by this opportunity as well. We have also paid out around $380000 in housing support products to 204 people providing assistance for things like their bond moving costs and letting fees.I look forward to this bill going to the select committee. I look forward to the opportunity for submissions to be heard where we can actually hear from others who are out there and the providers. I also acknowledge the championing of our Minister for Social Housing and our Ministers who are actually out here because at the heart of this bill it is about the devolution of trust. It is about ensuring that actually in the third sector it has the ability to be able to reach and meet the needs that the poor Government cannot. We believe this is actually a move that is in the right direction. I commend this bill to the select committee and to the House.METIRIA TUREI (Co-Leader—Green): Tēnā koe Mr Deputy Speaker. Tēnā koutou katoa o te Whare. This bill has two very simple purposes. The first is to help with Nick Smith’s ridiculous bungling over his attempts to sell public land to private interests land that should be offered back to Māori first. The bill does try to find some way of fixing that big mistake. The second—more important I think—purpose is that it is designed to make two Government Ministers the sole ownersin effect of an $18 billion asset that has been built by generations of New Zealanders for the many generations to follow. Under this bill these two Ministers can sell off any amount of that asset that they choose to anyone they like for any price that they decide is OK with zero oversight from the rest of New Zealand.This second and primary purpose of the bill—the selling off of an $18 billion State asset—makes it the largest State asset sale that this country has ever seen. Not only is this bill designed to facilitate the sale of this multibillion-dollar asset; it is a sale to anyone from anywhere. There are no constraints on these two Ministers as to how they choose to flog it off. It is a massive transfer of New Zealand’s housing wealth potentially sold off for a song to Australia to the UK to America to Canada—to whomever the two property-owning Ministers decide it is in their best interest to sell it to—and there is no mandate for this. There is no mandate for this asset sale. In the latest poll as we have heard New Zealanders are overwhelmingly opposed to the sale of State housing to an Australian entity. They want this State housing kept in New Zealand hands but this Government wants to be able to sell it off to anybody it likes.The problem for the Ministers is that John Key at the beginning of this year very grandly announced that he was going to sell 2000 State houses in 2015 and sell 8000 State houses before the election in 2017 but he failed to tell that to agencies like the Salvation Army which he had then expected to just front up with the cash to buy them. The Salvation Army did the economic analysis after being sprung on by this announcement and found that actually the cost of maintaining the housing—housing that has been neglected and degraded because of years of deferred and poor maintenance—made the whole concept of these thousands of houses being sold ludicrous. The cost of buying the homes and then restoring them to any degree of safe use for the tenants is simply beyond New Zealand’s community organisations no matter how motivated they are by compassion for the tenants in these homes.Now with this grandiose announcement by John Key about selling all these thousands of houses that are in total tatters because there is nobody to buy them the Government is now legislating to let two Ministers—just two—treat New Zealand State housing as if it is their own personal property. They can override the Housing New Zealand board and sell off these homes to whomever they want to for whatever price. We may well hear the Minister for Social Housing and others from National claim that they are bound by the social housing reform objectives but I can assure the country that those objectives do not provide any protection for the retention of State housing nor do they increase State housing in this country. The Ministers have to consider only one of those objectives not all of them and if the Housing New Zealand board which is supposed to be responsible for this work strongly disagrees with the Ministers’ plan to sell off the housing it has absolutely no authority to stop the Ministers acting as if they are the personal landlord of State houses.This bill makes two Ministers the landlord for 60000 families—60000 families will now have what Paula Bennett and Bill English as their personal landlord a landlord who will not fix the leaks who will not improve the ventilation who will not fix the dampness in these homes and who will not fix the broken windows or replace the missing doors or deal with the poor heating in those homes. They are landlords who are hell-bent on selling the properties and kicking out the tenants. And this is at a time when last week’s household income survey showed that 45000 more children are living in poverty than there were in 2013 for the most part because their parents’ incomes have stagnated and the housing costs for those families have skyrocketed—75 percent of families who are getting the accommodation supplement are paying more than 40 percent of their income in housing costs.That is a massive burden on low-income families. Fifty percent of these people are paying more than 50 percent of their income on housing. They simply cannot afford to be in the private market and they certainly cannot afford to buy their own homes. They are locked out of decent housing and they are locked out of homeownership but this Government has this pathological aversion to increasing the State housing stock to help to curb the massive rent increases and the massive price increases that we see fuelling the housing crisis.On top of that we know that 75 percent of the children in poverty have parents who rely on a benefit. That shows that this Government is deliberately keeping those families in poverty—75 percent of the poorest kids live in families that are dependent on a benefit—and benefits are so low that these families have no escape. Do not listen to any of the rhetoric around the $25 increase in benefits. We know that most families will not see even $20 of that if they are lucky.Seven out of 10 children living in poverty live in rental housing—seven out of 10 who live in poverty live in rentals. Rental housing is predominantly cold damp and unsafe. Poor-quality housing contributes to 1600 deaths each winter in New Zealand and rental housing is in many cases responsible for that and in some very clear cases State rental housing is responsible for that. We all remember Emma-Lita do we not? We all remember Emma-Lita.So the question is whether the two Ministers will take their new landlord responsibilities seriously. Will they make sure that all of the homes that they are responsible for are warm and dry and safe for the children who live in them? Will they fix the broken windows install the insulation and put in the safe heating devices? The answer of course is that they will not. Of course they are not going to go anywhere near that because their only objective under this bill is to be the auctioneer. They want to sell the property; they do not want to invest any more in the maintenance. There is no value for them in doing that. There has not been any up until now and there is not any impetus now under this legislation for them to fix those homes.The only objective under this bill is the asset stripping from New Zealanders of this $18 billion asset. In the process of throwing out thousands of New Zealand families who we know from the report on the household income survey are stuck in a poverty trap the Government is making that situation for those families so much worse by its inaction and neglect and by an ideology that says that the State should not be involved with housing no matter how desperately New Zealand families need the State to provide that very basic safety net.It will come as no surprise to you Mr Deputy Speaker or I expect the Government that we are opposing this bill. We are deeply disappointed in the face of all of the evidence that shows the desperate need for the improved quality of this housing the desperate need for more of it for the families who are living in garages and their cars as we know they are now—we are disappointed with the failure of Government to take seriously the 1600 deaths which includes many hundreds of children that happen every winter because of poor-quality housing. The only solution that this Government presents—the only solution—is to flog off one of the last remaining safety nets that our families and their kids so desperately need. It is the last remaining safety net which our grandparents built in order to protect our grandchildren and their children too. Thank you.DENIS O’ROURKE (NZ First): We need to look at the Social Housing Reform (Transaction Mandate) Bill in the context of the housing crisis—the housing crisis that this Government has constantly said does not exist. But home seekers know the truth. They know that homeownership is now only 65 percent—the lowest since 1951—and they know the reason. It is because home affordability has worsened in Auckland by 25 percent in the last year alone. The Government’s response to that has been utterly pathetic—in fact retrograde as this bill demonstrates—by trying to get the State out of social housing trying to fob it off on to often ill-equipped non-profit organisations. It is now selling State houses at a time when they are needed the most and to make matters worse allowing them to be sold overseas. John Key says that this is OK. However the vast majority of New Zealanders say that it is not OK because they know that this bill and legislation like it is just another step in the wrong direction.The bill empowers Ministers to direct the sale and transfer of Housing New Zealand Corporation homes ostensibly for housing reform objectives but the main objective is to simply get the State out of social housing. So the real objective is to fast track that process by giving Ministers wide and indeed excessive executive powers that are not usually given in any such circumstances. Actually the Government knows that because in its own disclosure statement it correctly says: “The transaction mandate is an unusual … mechanism. It provides Ministers with the ability to effect the transfer of HNZC assets in HNZC’s name without a decision-making role for the HNZC board.” So that raises the whole question about why it would bother to maintain such a board if in fact it is not allowed to make the decisions. The reason of course is that the Government does not in fact trust it to do what the Government thinks should be done. So the Government wants to both pay the piper and play the tune itself. Nothing could be more inappropriate.The bill allows Ministers to take Housing New Zealand assets and sell them without any involvement at all of the board that governs the organisation that owns them—very very inappropriate and very bad law. This represents yet another extension of executive powers by the Government. I have constantly complained in this House that the Government is taking on more and more powers of the executive in several new pieces of legislation over the last few years thus sidelining Parliament or sidelining agencies of Government established with parliamentary authority.But that is not the worst demonstration of the arrogance of this Government demonstrated in this bill. The bill allows land acquired by Housing New Zealand under the Public Works Act to be sold and transferred without complying with the usually required offer-back process. The reason for that is obvious—and I agree with Metiria Turei on this. When Nick Smith was embarrassed over the lack of Government land available in Auckland for new housing as he claimed was available he made reckless claims about how much land the Government would dedicate for the purpose without first checking whether the land was in fact suitable for housing and without first checking whether some of it was actually legally available for housing. This bill is therefore designed as Nick Smith’s face-saving device and nothing much more than that. Belatedly introducing this bill allows the Public Works Act to be bypassed and to hell with people for whom that process was intended to protect. The Government simply does not care about their rights and it wants to fast track its State housing privatisation programme at any cost.Alfred Ngaro said in his speech that the Public Works Act has never applied to State housing. That is only his opinion and it is not actually the law. It is not actually what that Act says and people need only to look at that legislation to know that. There are 2000 houses to be sold by this back-door method so who gets the proceeds and what can they be used for? New section 2A(4) inserted by clause 4 says that they “must be paid to a Crown Bank Account.” So what is the Government’s mandate for that money? How do we know whether the funds will go back into new social housing? There is nothing in the bill to describe that. So there are many unanswered questions about that.What we can be sure of is that this Government will want to reduce the role of the State in the provision of social housing despite the majority of people who are seeking the opposite and despite the fact that without more—not less—Government investment in housing the housing crisis will in fact deepen and will never be solved. The rationale of this bill is ostensibly the pursuit of the objectives in new section 50D which includes some of these—for example: “(c) social housing tenants are helped to independence as appropriate:”. What does that mean? It means pushing people out of State houses—that is what it means. Another one: “(d) there is more diverse ownership or provision of social housing:”. What does that mean? Privatisation of State houses—that is what it means. It goes on and on—“more innovation”—and the last one: “(f) the supply of affordable housing is increased especially in Auckland.” Yeah right! How by what process and by whom? Because it is not going to be by this Government that is for sure.In the end this is just another nail in the coffin of State housing in New Zealand. There is no reason for any confidence at all that any genuine effort will be put into the supply of more social housing in New Zealand as a result of this bill and the other legislation that this Government has passed in the last few years. Nor is there any guarantee that the money will go into the improvement of social housing quality which is so badly needed or even that the proceeds from these sales will go back into social housing in any way whatsoever. I have listened to the speeches from those opposite and none of them have given me any confidence that that would be the case. None of that money it seems to me is actually likely to go back into State housing at all. The only thing that we can be sure of is that this bill is driven in fact by National dogma and not genuinely by any social housing objectives intended to improve the lot of people who rely on State housing in this country. More and more and more people will be relying on it because of the housing affordability crisis and because of the lack of opportunities to buy homes in New Zealand which is also the direct fault of this Government which has spent so many years doing little or nothing about the whole housing crisis.So in order to achieve this bill’s real objectives which are not State housing objectives this Government is willing to create in this bill unusual and excessive executive powers and to use them to trample over the rights of people entitled to offer-back provisions which they should be entitled to use. Those provisions are going to be in fact nullified by this bill and they should not be. There is no need for it. There is no need indeed for the entire programme of the privatisation of State houses. There is no need indeed for the transfer of State houses to anybody. It would not matter what philosophy you are coming from—whether you think they should be managed by the State or by private interests—none of that justifies this bill or the sale of State houses. That is what it is about. It is about a sell-off. It is about privatisation. It is about the extension of executive powers in an unreasonable way.For all those reasons New Zealand First will certainly be voting against this bill now and at every stage.Mr DEPUTY SPEAKER: Before I call the next speaker I would like to congratulate the member on his delivery. However I would like to remind him that he was a lot more eloquent when he was not reading from his notes—when he was speaking off the cuff and referring to notes.TODD MULLER (National—Bay of Plenty): I am pleased to be able to stand here tonight and take a call in the first reading of the Social Housing Reform (Transaction Mandate) Bill. I am excited because this finally enables the reform of our social housing provision in this country to widen it more comprehensively beyond State provision only to facilitate more community housing provision more collaboration greater innovation in the models around that delivery and in the end to get greater outcomes for those who need it most—our vulnerable New Zealanders our “customers” as we heard this afternoon from Bill English.If ever there was an insight as to why this bill is needed it was the opportunity that was afforded to me a month or so ago when I was asked to attend a community housing hui in Merivale in Tauranga where 50 locals from that community had been called together to hear about this bill in particular and this particular policy reform. I had the privilege of outlining the position from the perspective of the Government but there were four others who were in the room representing Labour the Greens New Zealand First and even the Mana party. It was extraordinary the level of blind ideology that was imparted by the four parties that I mentioned: Labour the Greens New Zealand First and Mana. What was even worse was that the people in that room were nearly all clients of Housing New Zealand who had come to hear what it would mean for them and the language and the narrative that was used by the Labour and Green Party and New Zealand First representatives was appalling. They were told that they would be kicked out of their houses. They were told that this was a dirty deal between Housing New Zealand and community housing providers and that billions and billions of dollars’ worth of housing stock was going to be sold off.What was particularly revealing from my perspective was that speaker after speaker gave the philosophical view that only the Government—only the Government—through Housing New Zealand provision knows what is best for Merivale and Tauranga. They said that only the Government through Housing New Zealand should be the provider of State houses in that community. It was appalling in my view. It was a deliberate exercise in making vulnerable people feel more vulnerable through distorting deliberately what this policy is all about. But the Labour Party has form in this because in the 2008 election it wrote with Labour Party letterhead to every Housing New Zealand tenant and said: “If you vote for National you’ll get kicked out of your house.” That is what it does the Labour Party. It says it represents the most vulnerable but it uses them for its own political purpose and it is outrageous. It was fantastic to be able to stand there and give hopefully an effective outline of why this policy is important and why we are delivering for the people of Tauranga and Merivale.After the kai—we always appropriately have kai at half-time—I had the opportunity to reinforce some key messages around our commitment to have over 60000 State houses by 2017 our commitment to having an additional 3000 income-related rent subsidies by 2017 and our commitment to have housing provision remain for as long as the need is genuine and we will stand beside those people in their time of need. Most critical I could talk to our commitment that does not arrogantly assume that only Housing New Zealand should play a part in social housing provision but that together with community housing providers who are from the community who live in the community and who live its challenges and understand its opportunities we can achieve more. This is what this bill enables and it is why I am so proud to be able to stand here and support it.Obviously the key provisions for this bill support our social housing programme. The bill amends the Housing Corporation Act to provide designated Ministers with the authority to transfer Housing New Zealand properties and these designated Ministers will be able to do that by entering into appropriate commercial contracts in the name of Housing New Zealand. It was interesting to hear Mr Twyford argue—I think ineffectively—that somehow this is an over-reach in terms of ministerial power. I think it is absolutely appropriate. With Housing New Zealand under the current legislation it would be difficult for the Government to direct via policy intent particular houses to be sold on behalf of the State. This bill enables the Ministers to be able to enter into those various contractual negotiations.We heard earlier from Minister Bennett around the importance of the transparency provisions that are implicit here through the gazetting notice and the fact that we have to demonstrate at all times that these transfers are consistent with our social housing reform objectives. This legislation enables us to sell between 1000 and 2000 houses to community providers over the next year and of course as noted the Ministers can use this power only if it is consistent with one or more of the Social Housing Reform Programme objectives set out in the legislation. These are worth just stepping through because they are critical to the bill. The first is to ensure that “people who need housing support can access it and receive social services that meet their needs:”. The second is to ensure that “social housing is of the right size and configuration and in the right areas for households that need it:”. We have heard earlier from my esteemed colleague Matt Doocey the fantastic MP for Waimakariri about the mismatch at the moment between demand and supply with 25 percent of demand being for one-bedroom houses while only 9 percent of the supply exists in that space. The opposite of course is the case for three-bedroom houses which are 24 percent of the demand but just under half—43 percent—of supply. The configuration is not what we need and working with community housing providers will enable that to occur more easily.I am very pleased that Tauranga in particular has been selected as an area to work with our local community and community housing providers for some stock transfer. Obviously we have five community housing providers in Tauranga. There is the Tauranga Community Housing Trust and interestingly only a matter of a month or two ago Minister Bennett was in Tauranga opening a particular local social housing initiative that was put together by the Tauranga Community Housing Trust. Why is that so important and relevant here? It has the same footprint: twice as many houses provided all insulated all warm and all delivering to the mixed needs of that particular community. Ngāti Ranginui as we heard over the last 48 hours are obviously being involved and have 115 rights of first refusal. The country’s biggest non-governmental social housing provider is keen to buy houses in Tauranga. Two iwi organisations Ngā Pōtiki and Mangatawa Papamoa Blocks are keen to participate and have a fantastic vision that provides phenomenal opportunities for social housing not only for their iwi but also for the wider community particularly in Papamoa.So for Opposition members to stand up there as they have today and say that this is all about a philosophical view that is not connected with the community and that there is no demand is absolute patent nonsense. They need to get out of Wellington. They need to come up to Tauranga. They need to talk to the people whom they purport to represent who are lining up and saying they want to be a part of this. Those people have a vision for their community and they think that in this Government—not the Labour Government; this Government—they have a Government they can partner with that is innovative that is open and that will facilitate the delivery of their community housing needs.I look forward to supporting this bill through the select committee. I hope we get some good debate around the bill and I very much commend it to the House.Mr DEPUTY SPEAKER: This is a 5-minute call—Jan Logie.JAN LOGIE (Green): Tēnā koe Mr Deputy Speaker. The Green Party is opposing the Social Housing Reform (Transaction Mandate) Bill. This bill is part of a much wider agenda to reduce the function of the Government while increasing the power of the executive and providing more opportunities for property developers and business.This bill is part of the sell-off of our State homes and the Green Party believes in opposition to this bill that housing should be treated as core infrastructure in this country. We need to have a plan to ensure we have enough houses that those houses that we have are warm and dry and keeping us well and that they are connected to public transport and able to support community well-being. That is what we stand for—we stand for State housing and community housing alongside each other as part of a plan of having housing as core infrastructure.The Government though has decided to run down our State houses to leave the market to continue delivering damp unsafe houses to leave it to the market to deliver unaffordable new houses to make it harder to get into a State house and to kick out the families if they start earning too much. We have heard from members on that side of the House tonight about how you cannot expect a house for life—that that is just being entitled. I would like to see them say that to the faces of the veterans who were promised a house for life at the end of the Second World War and have been kicked out. I would like to see you have that conversation with them to their faces and tell them that they are being entitled in expecting the delivery of that promise.The Government has said that this is all about supporting community social housing and that we are being communists for resisting this measure despite the fact that it has sold 472 houses since September last year I understand and not one of those houses has gone to a community housing provider. Tell me how that is about supporting community housing. Tell me how putting Government policy on to community housing providers is about supporting the role of a vibrant community housing sector. It is not. That is actually about turning them into a cheaper arm of the State so that you can abdicate your responsibility put more pressure on to them and reduce your own costs. That is not delivering for New Zealanders. That is not delivering for the most vulnerable or actually giving credit or any respect to the absolute power of innovation in our community. It is not giving respect to any of those things that you are giving lip service to.What this bill actually does is give two Ministers special authority to direct the sales and leases of Housing New Zealand property. Under existing rules Ministers are able to direct the Housing New Zealand board to implement Government policy but they cannot dictate specific acts or sales. This bill overrides that. This is an overriding of the core function of the public sector. This is not only about reducing the role of the State in terms of State housing and our ability as a country to have some democratic control. Although the Government says—we have heard four times tonight I think—that it is a communist plot to suggest that we have State housing the point of State housing is that if the Government is running down the houses and people are upset about it they can vote and tell it that they are unhappy about that. When we put State housing out to property developers or even community organisations it is at a one arm’s length remove from our democratic control. The point of State housing is to enable New Zealanders to have some say over what is delivered and to have a direct interaction with that. We do not get that in this model when you are selling things off to property developers.It is not in the best interests of the country. For the Government to say that two Ministers can be responsible for 60000 families and a billion-dollar portfolio and that they have to report to this House only to tell us what they have sold off and to whom but with no other control—overriding all of the free and frank advice that might be provided from the Public Service—is frankly extraordinary. We want no part of this bill.The ASSISTANT SPEAKER (Lindsay Tisch): I call Jenny Salesa—5 minutes.JENNY SALESA (Labour—Manukau East): The Social Housing Reform (Transaction Mandate) Bill is an indictment on this Government and its duties to New Zealand. This bill proposes to give Ministers Bennett and English extraordinary powers to sell off Housing New Zealand State houses. This bill will allow them to personally negotiate contracts on any terms and conditions that they like and to take any actions to ease the sales process. If this bill is passed into law it will allow Ministers Bill English and the Hon Paula Bennett to sell off State houses without reference to the Housing New Zealand board to its chief executives or to its legislation.This Government is not being straight up with New Zealanders. It pretends that there is no housing crisis and that there are no issues with our economy.We have thousands and thousands of vulnerable families living in our electorate of Manukau East in South Auckland. Just last week I saw a family of nine—parents with seven young children. They came into our office because they are homeless and were seeking assistance. This family of nine have moved in with their relatives. They share a home with three other families—17 people living in one house—because the father who is earning a low income can no longer afford to pay the rent.The average rent for a three-bedroom house right now in Ōtara—which according to New Zealand’s deprivation index is one of the poorest most vulnerable communities in New Zealand—is $460 per week. Spending an average of $460 a week on rent is a lot of money especially when you take into account the fact that these are some of the poorest most vulnerable in our society. The median household income in Ōtara right now is $48500. The median household income for families in Ōtāhuhu is $46200. The struggles for so many families whom I see in my office in Ōtara are very very real. The family of nine whom I saw who reached out to me for assistance because they are homeless has gone through the Work and Income assessment process. I am glad to report that they are able to qualify to be housed in a Housing New Zealand State house. However our office has been informed that State houses in our electorate of Ōtara are 98 percent occupied so who knows how long this family will have to wait—and wait—before they are eventually housed.Meanwhile Ministers English and Bennett are about to flog off the thousands of State houses that we currently have. How about housing the vulnerable families that we already have on the book? How about housing the thousands who already qualify to be housed by Housing New Zealand—the thousands who have been waiting for months and months and some of them for over a year just to have a roof over their heads? It will be great when this Government through its actions actually shows that it cares equally for all families in all of Aotearoa New Zealand instead of just saying that it does care and instead of just saying that it is a compassionate Government. Actions speak louder than words.Social housing plays a significant part in supporting the communities in my electorate. At the last census count a third of Manukau East’s rental properties and two-thirds in Ōtara actually belonged to Housing New Zealand. In terms of numbers that is 2128 State houses in Ōtara and in total in Manukau East it is 3761 State houses across our electorate. There is a shortage of social housing and the numbers are indeed at an all-time high. Across all of New Zealand over 5000 families are on the waiting list for a social housing State house.I urge this House to reject this bill. I urge the Government to give up selling our State houses—our assets—and instead to actually house our most vulnerable families. Thank you.JONO NAYLOR (National): I feel this evening as though I am trapped inside a children’s storybook. From what I have heard from the other side of the House it feels like the story of Chicken Licken—“The sky is falling the sky is falling.” It is doom it is gloom and nothing good can possibly ever happen. All we are hearing about are the negative things that perhaps might be going to happen as a result of this bill.I think it is really important that we do put this bill in the context of what it is that this Government is trying to achieve for the vulnerable people of New Zealand. I guess the first point is that the provision of social housing in New Zealand is going to continue. It is something that this Government is committed to having happen. We are looking at some different ways that we can perhaps deliver social housing in New Zealand and I think that is a good thing. We continue to be committed to ensuring that the people who need it the most will still be getting the assistance they need through social housing. That is fundamental in any society that is caring and from a Government that has any level of benevolence. This Government is no different in that regard.The question I guess we need to ask ourselves fundamentally when we are looking at anything to do with social housing is whether the Government should be in the business of ensuring that those people who are unable to house themselves are housed. The answer to that question unreservedly is that yes we should—absolutely we should. It is absolutely the business of Government to ensure that when people are unable to house themselves or when perhaps they are not able to afford to do that the Government provides subsidies on occasion perhaps the Government can provide housing or the Government perhaps empowers other organisations to provide housing. This Government continues to be committed to the idea that the Government should be in the business of providing social housing.Does this mean however that we need to stick to the same mode of delivery that we have always used? The answer to that is no not necessarily.In the 1930s Mr Savage was the Prime Minister and he kind of initiated this idea of State housing in New Zealand. In Palmerston North we have got Savage Crescent which is now a heritage site because it has got some of the first State houses that were constructed in New Zealand. Is it appropriate that they remain there as a heritage site? Yes it is. It is really important because it is an important part of New Zealand’s history. It is an important part of a good idea at the time that delivered a really great outcome for the people of New Zealand. But if I was listening to the members on the other side of the House this evening I would think that innovation stopped in the 1930s—that when Mr Savage as Prime Minister and his Government brought up the idea of State housing it was the last good idea that anybody could possibly ever have about the provision of State housing in New Zealand and that therefore we must not tinker we must not meddle and we must not do anything that could possibly be different from what is happening.Well I am not prepared to just settle on what has been done in the past. I am aspirational for the people of New Zealand.Chris Bishop: Ambitious.JONO NAYLOR: I am ambitious even for the people of New Zealand because I do not want them to simply have just what was always provided before. I think that the people of New Zealand deserve better than to have us simply resting on what was done close to 100 years ago. I think they deserve to have us thinking about creative ways in which we can deliver an even better service to them.We are going down the path of innovation. This Government is absolutely committed to looking at innovative new ways to help people in the area of housing. I will touch on the bill a little bit more but again I just want to get the context right. Remember that this Government is also looking to help more people get into their first home. We have introduced the HomeStart package which is helping young people to be able to cash in on their KiwiSaver account to be able to get greater grants from the Government to enable them to get into their first home. We are absolutely committed to ensuring that we reverse the trend of people finding it harder to get into their own home. We are committed to ensuring that people will be able to get into their first home and we are looking forward to seeing what is going to be happening. We have been doing roadshows on the HomeStart package around the country. The level of interest from mortgage brokers and young people who can finally see an opportunity to get into their first house—they are absolutely getting into it. They are loving the idea. We are going to see some great things happening from that.For those people on lower incomes who have been either renting properties or are living in their own home we have done a whole heap of work over the last few years on warming up those homes. We believe that people should live in healthy homes live in warm homes. The Warm Up New Zealand: Healthy Homes campaign has been a fantastic success which has seen so many people now living in homes that are warmer and drier and they are living better. But we have got to keep going because this Government is not going to just sit there and say: “Well that’s last good idea that we’ve had—HomeStart and warming up homes.” Unlike members opposite who want to rest on a 1930s decision and stay there we are going to keep going. We are going to keep doing more to deliver better outcomes for New Zealanders.One of the things that has received a bit of criticism and I will not shy away from it is the tenancy reviews that have been going on. Some of those reviews have been really really interesting. What we have found is that there are a number of people who are currently living in State-owned houses who are actually paying either a full rent or nearly a full rent. I have to ask myself: what is the point in the Government owning houses that people live in and pay full rents for? Those are people who could be paying market rents who perhaps could even be potentially buying their own homes but they are staying in the house that the State provided for them as was appropriate when they had the need beyond the point when they have that need. So it is appropriate that those people move on from that point and that they move into other arrangements that they can afford so that we can free up those houses for those people who most need them.It has been really interesting. The moment that those tenancy reviews have been done with a number of people the first thing they have said is: “Oh yes I guess we could go and look somewhere else. Actually perhaps we could think about buying.” I think that is a really positive outcome for those people to get out from underneath the feet of the Government and start to take control of their own lives and get involved in that way.I think it is really important again that we continue to work down this path. It was really interesting and I have told this story before but I hope if people have heard it they will not mind hearing it again. Last year I spoke to a woman who was living in a four-bedroom State house. It had been really good for her when her children were young. They had grown up and they had moved on. This woman said to me: “But don’t worry Jono those rooms aren’t going to waste because I’ve got international students living in there. I’ve got international students who are helping to supplement my income.” On one level I was kind of thinking that that was very good innovative entrepreneurial thinking on her part but that said I also thought that what she was doing was stopping some people who perhaps needed that kind of housing. So we are looking at what we are doing with our portfolio. We want to make sure that our portfolio delivers the right kind of housing to the people who need it most rather than just presuming that the stock of houses that was built in the 1930s for families of the 1930s will meet the need of today.I just want to come back finally to this point about innovation. Currently we have got over 60000 New Zealand homes. What we are talking about here is some empowering legislation that will allow the relevant Ministers to sell—or actually not just sell. It is interesting. People have been talking about selling but if you read the explanatory note on the front of the bill—I suggest members opposite do—it states very clearly that “Contracts may be for the sale or lease of properties”.This is not just about sales; it is about having flexibility for us to be innovative. We have got over 60000 State houses; we are talking about one or two thousand. That is about 2 or 3 percent of the current housing stock that we are debating tonight. We are not talking about a radical overhaul. We are not talking about a mass sell-off. What we are talking about is giving the relevant Ministers the flexibility to be innovative with a very small proportion of our housing stock so that we can have a look we can see whether or not these things will deliver better results and if they do perhaps we will do some more. But what we are going to keep doing is we are going to ensure that the people of New Zealand who most need our help get our help. Therefore I commend this bill to the House.Su’a WILLIAM SIO (Labour—Māngere): Earlier tonight in the Legislative Council Chamber I joined with my Labour Party colleagues and other members of the Opposition to welcome representatives of families of the workers who have died in work-related accidents in the last 5 years including those who died in the Pike River tragedy. I want to acknowledge them. One of the questions that a speaker raised there was that they were promised by this Government and by this Prime Minister that legislation would come into this House that would ensure protection for all workers and they feel—The ASSISTANT SPEAKER (Lindsay Tisch): Order! That is not part of the debate.Su’a WILLIAM SIO: —that that promise has not been kept. I raise that Mr Assistant Speaker because that is the question that New Zealanders need to ask of Government members when they listen to their speeches on this particular bill and the promises that they are making that this bill will enable more social community providers to provide more social housing. What they are promising New Zealanders is that under this bill by selling off State houses more social housing is to be provided to New Zealanders.We have heard tonight that the Minister for Social Housing made that promise by saying that this bill gives her and another Minister exclusive powers to sell thousands of houses in the current housing stock to the private sector. Those members say “community housing providers” but we know that that is not what is intended. They are not being straight with New Zealanders. When they use the words “community housing providers” we think it is going to be the Salvation Army but that is not true. We think it is going to be the Methodist Mission but that is not true. What is true is that they have been talking to property investors—property investors not only in New Zealand but also in Australia. So when they say “community housing providers” it is the property investors whom they intend to sell these houses to. So I ask New Zealanders as they listen to this to remember the promise that was given to the Pike River families and to ask themselves whether they can trust this Government in making the similar promises that it now makes to New Zealanders in regard to the provision of social housing.The regulatory impact statement on this bill will give listeners a bit of an idea of the incompetency of this Government. It says: “The proposals have been prepared in a short timeframe … they have been prepared without precise information about the form of the transfers transactions and HNZC’s future role in the social housing market …”. The future of the social housing market under this Government’s legislation is that it is going to destroy Housing New Zealand as we know it. It is destroying a tradition that has existed since 1905 when from thence forward the Government of the time and subsequent Governments agreed that there was a right for every new citizen of this country to be housed. It was a basic fundamental right. That right is enshrined in international covenants. Subsequent Governments have upheld that.In 1970 we continued under the Labour Government the provision of social housing because of that belief that it was a basic and fundamental right that every New Zealander should be housed in a house that was affordable in a house that was warm and in a house that was safe for families.What does a conservative Government that has existed—what has been its attitude towards the provisions of social housing? As far as we go back every time there has been a conservative Government that has come into power it is its belief that it should sell off State housing. It is its belief that the private sector should rule. The same thing happened also in the 1990s when the former National Government did the same.But this Government now is going to go further. So what is it going to do? It will give Ministers Bennett and English the exclusive power to sell off State houses. Who will they sell them to? Here is what the Government says: it is part of its social reform strategy. If you look at the first point that the Government makes it establishes “the Ministry of Social Development (MSD) as the single purchaser of social housing …”. What does that mean? No longer will you have Housing New Zealand providing social housing. In the second point it says “growing Community Housing Providers (CHPs) through MSD’s contracting and transfers of Housing New Zealand Corporation (HNZC) stock;”. What does that mean? It is going to sell off the housing stock to property investors.Another point is “making Income Related Rent Subsidies (IRRS) available to non-government CHPs to help those providers to grow;”. What does that mean? It is going to subsidise landlords and property investors to provide this particular service. The final part that it says this legislation provides is “housing more families by making better use of HNZC land”. What does that mean? It is selling off land that is currently owned by Housing New Zealand into the private sector.But this is what the disclosure statement prepared by Treasury says—that this legislation is unprecedented. These are new powers—new powers—that it is giving its Ministers because not only are the Ministers not accountable to Housing New Zealand or the board but they are accountable to only themselves.Where does the money go from selling the stock and from selling the land that belongs to Housing New Zealand? It does not go back to the Housing New Zealand board; it goes into the Crown entity’s bank account. What does it get used for? Certainly it does not indicate anything about the provision of more social housing.The Government has not been straight with New Zealanders when it introduced this legislation. That is why I said that the promise that it made to the Pike River families is a similar promise to the one that it is making today to New Zealanders. People need to be asking themselves whether they can trust this Government to keep its word. I say no. I say if you base it on its track record so far there is no way that selling off State houses will ensure that there is greater provision of social housing to those in need.One of the Government members at least acknowledged that there is a role for the State in the provision of this. But once a State house with a tenant is sold to the private sector do we imagine that the landlord is going to fix up the heater when it breaks down? Do we imagine that the landlord is going to replace the carpet if it is ruined? Do we imagine that the landlord is going to keep that house warm so that the children living there are free from any sicknesses and illnesses? If we go by the track record of most landlords that is not going to happen—based on the complaints that our offices receive.The other day I was in the electorate of Botany. I took Andrew Little there and we visited the Salvation Army in Howick. I imagine that when we talk about Howick—it is an affluent part of our society in Manukau. But this is what the Salvation Army said to us: of all the issues that it is now facing in a wealthy part of South Auckland in Howick housing is No. 2 after the loneliness of that generally older population. It is now seeing more and more people being in housing situations where they are renting a garage which does not have insulation and does not have any warmth. It also said that it is surprised by the number of people who are now in homeless situations and the Salvation Army is having to find homes for them.That is the kind of condition that this Government has established for New Zealand in the last 7 years. It will continue along that pathway based on this legislation. Yes Government members can say all they want about helping the poor but this piece of legislation does not do that.I want to finally finish off. Most of us would have campaigned and walked around and at one time or another would have stood on dog tae tae. If you imagine standing on that we have often had the experience of trying to clean it off. It does not go away—it stays. I would say that when this Government passes this piece of legislation New Zealanders will for ever remember it is this Government that is selling off Housing New Zealand homes and the stench is going to stick with it for ever.I want to finally say—farmers will appreciate this. Farmers have a saying “It does not matter how much perfume you pour on pig shit it still stinks”. That is why despite Government members’ flowery words this piece of legislation will hurt ordinary New Zealanders.Dr PARMJEET PARMAR (National): Thank you for the opportunity to speak on the Social Housing Reform (Transaction Mandate) Bill in its first reading. It is a pleasure to take this call in support of this bill. The social housing reforms are important and they are well on track. Our social housing reforms are about recognising and understanding families in need. Our focus is on making sure that people who need social housing get that at the right time and also for the right amount of time. People have different kinds of needs. Some people need long-term State housing while others are able to move on to private rentals as their circumstances change. So this is about privatising social housing for people in the greatest need and also providing opportunity for people who can move on to private rentals.This Government is keen to work with different organisations to encourage community housing and that is what this bill is about. This bill is to support the Social Housing Reform Programme by amending the Housing Corporation Act 1974 to provide designated Ministers with the authority to transfer Housing New Zealand Corporation properties. Ministers will be able to do that by getting into contracts in the name of Housing New Zealand. This bill will also help Ministers to make sure that Housing New Zealand looks after tenants in those properties that are being transferred. So those tenants are the focus of this bill. The Social Housing Reform Programme is to provide more social houses through Housing New Zealand and also through community housing providers. This involves the transfer of houses from Housing New Zealand to community housing providers. The initial proposal is to transfer 1000 to 2000 houses from Housing New Zealand to community housing providers.This National Government cares about people. We care about families. This National Government is committed to looking after people—those who need social housing. This National Government is committed to providing income-related rental subsidies for more households. Currently there are 62000 households around New Zealand receiving taxpayer-supported income-related rental subsidies. This National Government has committed to increasing that by 3000 households by 2017-18.We need these reforms; that is why we need this bill. It is important because there are around 3600 people assessed as having a high need. They are on the waiting list of the social housing register—yes 3600 people are on the waiting list. There are around 1300 Housing New Zealand tenants who have applied for a transfer. This is a very challenging situation because one-third of the $18.7 billion Housing New Zealand portfolio is in the wrong place or is of the wrong type. For example 30 percent of people on the waiting list want to get into a one-bedroom house. But if we look at our stock only 9 percent of the houses that we have are one-bedroom houses. Also people’s needs change with time and their needs are not just about housing itself so it is important to look at other kinds of arrangements.This Government has already taken a number of steps to improve the supply of social housing. If you go back to 2010 after a report from the Housing Shareholders’ Advisory Group the Government’s programme has so far included setting up the Social Housing Unit in 2011.This was recommended by that advisory group and this was to help grow a community housing sector and also then changing the law in 2013 was to open social housing to approved non-Government providers so that they could receive the same subsidies as Housing New Zealand. During the 2014 election campaign the Prime Minister confirmed that we will be moving away from Housing New Zealand’s monopoly to a range of social housing providers.Our goal is to have a strong social housing system that people can access and that provides for people’s needs. We want to make sure that people are able to get into social housing when they need to. We also want to make sure that those houses are of the right size that they are of the right configuration that they are of good quality and that they are in the right kind of area. The Government will continue to be the largest owner of social houses and it will further increase subsidies for New Zealanders in housing need. Over the next few years the Government wants to see that Housing New Zealand and community housing providers collectively are able to provide more social houses than we have now.As I said Housing New Zealand will continue to be by far the largest owner of subsidised houses and we will ensure that in 2017 it provides at least 60000 properties which is down from 68000. This is taking into consideration various community housing providers coming on board.I heard the previous speaker Su’a William Sio and just to clarify tenants in properties that will be sold will continue to stay in those properties. They will stay in those properties for the duration of their need. The Government will spend more on income-related rent subsidies and ensure that Housing New Zealand has enough capital to redevelop and look after those properties. This bill is not about selling State houses—just to explain to the Opposition. Yes it is not about selling State houses. It is about better meeting the needs of tenants by supporting the growth of the community housing sector and ensuring that there are more social houses available for people who need them. As I said before the Government will be providing income-related rental subsidies for another 3000 houses by 2017-18 taking that number from 62000 houses to 65000. The Government is committed to both supporting a stronger community housing sector and also investing significantly in Housing New Zealand properties and to providing $1.9 billion per year in accommodation support.Our focus is on families not on the number of houses owned by the Government. We know that tenants’ needs can be better met through innovation through diversity and through providing choice and that is why we need to involve community housing providers. Community housing providers can provide a wraparound support to those people who need social services so that they do not have to go to multiple agencies and explain their circumstances. So it makes it really easy for people.I also heard Su’a William Sio the member speaking before me saying that these houses will be sold in Australia. These houses will be sold to organisations that are willing to register with us as community housing providers which means that they will have to meet some strict standards. There are standards that they will have to meet and only then can they buy these houses. So there are strict criteria for them to buy these houses. Properties sold as social houses will continue to remain as social houses unless the Government agrees otherwise. In most cases when these houses are transferred there will be tenants in them. They will be looked after. So this bill is about making sure that Housing New Zealand looks after those people during that transfer process and if there is any redevelopment of those houses it will make sure that those people are provided with proper accommodation as per their needs.People have complex needs and to provide for those complex needs the Government needs to work with different parties—non-government organisations and community-based organisations—and that is what we are doing. So I support this bill and commend it to the House. Thank you.A party vote was called for on the question That the Social Housing Reform (Transaction Mandate) Bill be now read a first time.Ayes 63New Zealand National 59; Māori Party 2; ACT New Zealand 1; United Future 1.Noes 58New Zealand Labour 32; Green Party 14; New Zealand First 12.Bill read a first time.Bill referred to the Social Services Committee.