Smith Nick: Budget Debate 
Smith Nick: Budget Debate 
[Volume:647;Page:16472] 
Hon Dr NICK SMITH (National—Nelson) 
: 
 Last Sunday’s newspaper had the headline “150000 homeowners risk losing their home”. What particularly concerned me as the member of Parliament for Nelson was that 42 percent of the homeowners in my home community of Nelson are under mortgage stress—that is they have to spend more than 45 percent of their income on meeting their mortgage costs. This afternoon in debating this Budget I want to drill down below the Government’s spin and look at the substance of what is going on for New Zealanders in respect of their housing costs. You see in this Budget the Government and Maryan Street the Minister of Housing have said that the answer was the Government’s home equity scheme. The Minister said it would make an enormous difference to families who are struggling to meet their housing costs. Well let me go through the numbers as to just what that policy means. 
The policy involves 700 home equity loans. They will be allocated on a population basis between Auckland Wellington Christchurch Nelson and Queenstown. That means that my electorate of Nelson will get 20 loans over 2 years—10 loans per year. 
Jill Pettis 
: They’ll get nothing under National. 
Hon Dr NICK SMITH 
: I tell Jill Pettis that the Government then says under this scheme that if someone buys a house it must be for less than $240000. The member opposite obviously has not been out there in the real world because if she had she would know very few homes are available in Nelson for $240000. The Government’s scheme says it will provide an interest-free loan of 10 percent of that value. It is an interest-free loan of $24000 for 10 people a year. That means help of 40 bucks a week—that is the value of an interest-free loan—for 10 families in Nelson this year and next year. 
I went to the library and asked in respect of the newspaper reports of mortgage stress how much Labour’s interest rate policies are costing my constituents in Nelson. The library calculated the number of mortgages in Nelson; 5712 families have mortgages. As a consequence of increased interest rates under this Government they face average increased costs of $160 a week. Let me recite that again for the benefit of members. In my electorate 5700 families have to pay an extra $160 a week and Labour says it will give 10 families 40 bucks and the problem will all be solved. I say to members opposite that that is a fraud. I say to members opposite that that will make not one iota of difference for families in my electorate that are struggling. 
I can put it in another way. Labour proposes to spend $40000 a year in Nelson on the much-publicised home equity scheme. But the increased cost of mortgages is costing my constituent families in Nelson $50 million a year. Let me just say that again. The increased cost to families in my electorate from high interest rates is $50 million a year and Labour in this Budget says it will solve that problem with a home equity scheme that will put 1000th of that amount into my electorate. 
Perhaps I could express it in another way as well. I asked my local council to tell me by how much the Government has put up the charges for building a house in Nelson. Some members will be aware that in 2004 Labour put up the building levy. In 1999 the building levy in the Nelson area was $31000 a year. That was the amount of tax that the Government put on every time someone in Nelson got a building consent. Do members know what it has gone up to? From $31000 a year it has risen exactly tenfold. It has gone up by 1000 percent. The Government has put up the tax on owning a home in Nelson tenfold and taken another $280000 a year not just in 2008 but in 2007 2006 2005 and 2004. It has increased the charges by $280000 a year and now it is to give us $40000 back in this Budget and is expecting the people of Nelson to be grateful for that. 
Then yesterday in this Parliament the Minister of Housing defended her Housing New Zealand Corporation officials going to one of the most luxurious lodges in New Zealand to live it up big time spending $65000 in one of the flashest pubs in the country at the same time as the Government is telling the families of Nelson it can spare only $40000 to help them with their housing costs. What has happened to the conscience of the Labour members in this Government that they think it is OK to spend $65000 on a lair-up for housing officials while 42 percent of the homeowners in Nelson my home area are under extreme mortgage stress? I know that Jill Pettis is defending the $65000 that Maryan Street said it was OK to spend on housing officials living it up at a luxury lodge at Tongariro while families in New Zealand cannot afford to pay for a basic roof over their head. 
I say to members opposite that this Budget is dishonest. In this Budget it is dishonest to state there is $40000 for the people of Nelson to help with housing costs when they face increased mortgage costs of $50 million a year and when this Government has increased tenfold its costs to those who want to build a home in my community. I say to members opposite that their big Government policies have increased interest rates in every year that Labour has been in Government. When Labour took office interest rates were but 6.7 percent; they are now 10.4 percent. I do not think members opposite understand the sort of stress that puts on families that aspire to own their own homes. I say to members opposite that the Government’s home equity scheme announced in 2004 in 2005 and in 2006 and finally delivered in 2008 is a joke for the people of Nelson. I say to the Minister of Housing that one of the reasons this Government will be thrown out of office is that it does not understand the aspiration of New Zealanders to be able to own their own home. They want a Government that will know that getting interest rates down is the most important thing a responsible Government can do in order to allow them to achieve that.