Social Housing Reform (Housing Restructuring and Tenancy Matters Amendment) Bill

I move, That the Social Housing Reform (Housing Restructuring and Tenancy Matters Amendment) Bill be now read a second time. I am proud to commend this bill to the House. This Government stands for better and smarter public services. If we are to balance the Budget and live within our means but at the same time deliver better social outcomes, we need innovative approaches to issues like social housing. This bill is based on best international practice. The UK and Australia are well down the path of having a more diverse approach to social housing. But it is also based on careful, solid policy-making for New Zealand, and I again want to acknowledge the authors of the Vision for Social Housing report, who are very much the architects of the changes in this bill.

The bill moves us from having a frame of thinking around State housing to one of social housing, where we encourage, where we fund, and where we grow a wide range of social housing providers. It enables a wider range of tenants to have access to income-related rents. It helps ensure that our social housing is focused on those people in New Zealand who have the greatest need.

The bill sets up the regulatory framework to both grow and manage the more diverse social housing sector. It enables the transfer of housing assessment from Housing New Zealand Corporation to the Ministry of Social Development, recognising that for families, housing is just one of the needs and the merits of a more integrated approach.

I want to acknowledge the hard work of the Social Services Committee and the changes that have been made by it. I particularly want to acknowledge and thank the chair of the committee, Sam Lotu-Iiga, and note the sad passing of his father this week. Sam Lotu-Iiga’s and the committee’s thoughtful and meticulous work on this bill lays a great foundation for the growth of the New Zealand social housing sector. I also want to acknowledge the hard work of Housing New Zealand Corporation, the Ministry of Social Development, and the Ministry of Business, Innovation and Employment in preparing this bill and for their ongoing work with the select committee. I would like to make a particular mention of the hard work of the Parliamentary Counsel Office in preparing the changes made during the select committee consideration.

I want to thank and acknowledge the wide range of organisations that made very constructive submissions on this bill. The committee received 380 submissions—43 of these were quite unique and had substantive material with them, and 20 of those submissions were presented orally. It is interesting to note that the vast majority of those submissions were very supportive of the reforms in this bill. Submitters were pleased to see the expansion of income-related rents to community housing providers, and the transfer of the housing needs-assessment function to the Ministry of Social Development. The feedback from submitters was insightful. It came from many of the players in the sector and it has enabled us not only to improve the bill but actually to help work on the regulations and help to get the officials lined up to make these reforms successful.

A number of specific issues in the bill were raised by submitters, which have been responded to with changes. One of the first changes is a new provision that has been inserted in the bill allowing ministerial directions on the timing and targeting of the review of ongoing eligibility for social housing. This will enable the Minister for Social Development and the Minister of Housing to jointly identify people who are to be excluded from the reviewable tenancies. In response to submitters’ feedback about the proportionality of the intervention powers included in the bill, we have got a new tiered regulatory framework, which is very much modelled on what I saw operating very successfully in Australia with its regulatory system. This will mean that community housing providers in receipt of the income-related rent subsidy only, and not capital grants or stock transfers, will not be subject to all of those intervention powers.

A number of amendments have also been made around those intervention powers, which now apply to only those community housing providers that are receiving those capital grants or stock transfers. These changes are about the ministerial direction on the use of intervention powers, where they will be mandatory. A regulator can now make only minority appointments to the governing board of a community housing provider. An appeals body is to be established to give community housing providers the opportunity to appeal decisions that are made by the new regulator.

The changes also mean that regulations can be made outlining the types of providers that may or may not receive that all-important income-related rent subsidy. This will give the Government the flexibility required to respond to the changes in demand for social housing. For too long, Government policy around housing has come down to a simplistic argument about whether there are more State houses. That is about as much sophistication as the argument had. The new model works a lot better and will result in those families who are most in need getting access to housing. It will make sure that our houses are properly maintained. That is something members opposite should hang their heads in shame about—the lack of investment and the poor quality of the State house estate that they left. That view has been backed by the Housing Shareholders’ Advisory Group, which has provided the foundations for this reform.

This bill focuses on improving the quality of social housing by creating a new social housing model that can better respond to the circumstances of families living in social housing, requiring them to be provided with high-quality, suitable housing. In the Budget this year the Government announced $2.9 billion of investment in Housing New Zealand to improve the quality of the Housing New Zealand stock. That is more than double what the previous Government invested in any 3-year period in our own Housing New Zealand and puts to bed any accusation that this bill is about reducing the Government’s role in providing housing.

Alongside that has been the huge investment that is going on in Christchurch in repairing our housing stock. Project 324&5 is realigning our own Government’s housing to better meet the needs of more diverse families. There are tens of thousands of State houses that we have successfully insulated—and I remind the House of the Government’s commitment to make sure that every Housing New Zealand house that can be insulated will be insulated by the end of this year, that by the end of next year every house that is earthquake-prone will be repaired, and that by the end of 2015 every one of those 5,000 houses that was damaged in the earthquakes will be fixed. That shows the level of the commitment of this Government to improving the Government’s own housing stock.

I commend this bill to the House. It is a well-thought-through reform. It has both good international context for the changes that we are making and been very well put together by the group. It involved a very diverse group of people involved in social services, and particularly in social housing. This is a bill that, as I said at the beginning, makes huge improvements to the way in which the Government delivers social housing. I commend it to the House.

First, let me begin with some comments generally about the Minister of Housing’s stewardship of the housing portfolio. Two words come to mind: utter shambles. We have seen in the last few weeks and the last few days, one after the other, aspects of the Minister’s portfolio that are in absolute disarray.

The most recent is the loan-to-value ratio spending limits where it is blatantly clear to everybody that the Government has mismanaged the portfolio and this issue. It failed to take into account the impact on first-home buyers. It failed to consider that it would depress new builds and the imperative of increasing supply. It failed to properly consider the implications for provincial New Zealand. House prices in Auckland, the most overheated property market, are up 17.9 percent over the last 12 months. In Canterbury the Government is in denial. It insists that there is no housing crisis in Canterbury when people are paying hundreds of dollars a week to live in sleepouts and caravans and rents are up 25 percent in the last year. Government agencies are routinely referring people to live in campgrounds, and interest rates are heading north of 10 percent.

Those are the true key performance indicators of Nick Smith’s stewardship of the housing portfolio. There are numerous problems that are out of control but the Minister behaves like a jack-in-the-box, popping up every few days with the media in tow to announce the fitting of a new door handle in some house somewhere around the country. He is desperately trying to convince the New Zealand public that the Government is not to blame for the housing crisis. He is running around like a jack-in-the-box, desperately trying to convey the impression that the Government has got a handle on the housing crisis.

This bill that we are debating this afternoon, the Social Housing Reform (Housing Restructuring and Tenancy Matters Amendment) Bill, is more busywork from the Minister. He will not do the obvious thing in the worst housing crisis, the worst housing shortage, in living memory. He will not do the obvious thing and increase the amount of State and social housing. All he is willing to do is shuffle the pack. That is all he is willing to do.

Let me explain. Only 4 percent of the New Zealand population is currently housed by State and social housing—only 4 percent. That is woefully low by international standards. It is. The Minister is shaking his head but he knows that I am right. 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 I will go on to explain Labour is perfectly comfortable with in principle. It accepts all of the key arguments why it is a good thing for New Zealand to grow and empower the community housing sector. However, this Minister insists on slicing up the pie in different ways, but he utterly refuses to grow the pie.

Secondly, he wants to make all State house tenants subject to insecurity of tenure. Again, we will talk in more detail about this. Under this legislation all State house tenants will be subject to reviewable tenancies. Instead of building more State and social housing, the Minister wants to more ruthlessly move tenants through those properties. He is only shuffling the last few cards in the pack. That is all he is doing. He refuses—or perhaps it is his Cabinet colleagues whom he has been unable to convince, because they absolutely refuse—to consider actually increasing the stock of social and State housing.

Labour will not vote for a bill that gives Nick Smith the power to throw 80-year-olds out on the street simply because there are not enough houses. Labour will not support it even though there are some aspects of this bill that it supports. The fundamental objection Labour has is that this bill gives Nick Smith the power to throw 80-year-olds out on the street because there are not enough houses. That is politically and ethically bankrupt.

We believe that this provision in the bill will create needless stress and anxiety. As expert submitters told the Social Services Committee, it will actually pose a public health risk by piling that needless stress, insecurity, and anxiety on some of the people who are least able to cope with that. Only National would announce with great pride and fanfare in the Budget speech that its goal, its objective, is to kick 3,000 State house tenants out of their houses. That is National’s idea of a State housing policy.

I want to quote the Productivity Commission, because that organisation is that Minister’s touchstone.

💬 Hon Dr Nick Smith: You called it an “ideological burp”.

It is that Minister’s touchstone. The Productivity Commission’s report on affordable housing is the bible that Nick Smith reaches for whenever he is in doubt. I have referred to the commission in this House as ideological dinosaurs because I believe that is what it is. But I am going to quote the report, because the Productivity Commission is Nick Smith’s bible. On this issue of reviewable tenancies this is what Nick Smith’s intellectual mentor had to say. It said that “moving people through state houses [on the basis of reviewable tenancies] undervalues the stability needed for sustainable improvements in social outcomes … social housing is best thought of as a contribution to a complex set of social needs that typically occur in clusters. The current approach to reform”—that is, the imposition of reviewable tenancies—“is not always in harmony with the desires of communities for stability and continuity, which are often essential for addressing the needs of families requiring social assistance.”

Well, Minister, I suggest you go back to your intellectual mentors at the Productivity Commission and consider for a moment what they have to say about one of the most important provisions in this bill. They do not support reviewable tenancies. They are advising you to do the opposite of what you are doing in this bill.

💬 Hon Dr Nick Smith: No, they’re not.

Yes, they are.

I want to refer to the submission from an excellent organisation that is part of Otago University’s Wellington campus. The name of the organisation is He Kainga Oranga, the housing and health research programme. It is headed up by Professor Philippa Howden-Chapman. This organisation is the gold standard when it comes to matters of housing and public health. It has carried out a pile of world-class public health research on this issue. It has won the public argument and established without any doubt that overcrowding and poor-quality homes are directly attributable to the appalling statistics we have in this country in the hospitalisation of children for respiratory diseases. What Philippa Howden-Chapman said to the select committee was that the Minister’s insistence on applying insecurity of tenure to all State house tenants would pose a public health risk.

I look forward, when we debate this bill in more detail, to going into the detail of the evidence that the Otago University academics presented to the select committee on this issue. What they showed us at the select committee was that taking away security of tenure from some of the most economically and socially vulnerable people in New Zealand would pose a public health risk to those people.

The second thing that this bill does is enable the transfer of State housing stock to the community housing sector. Labour supports growing the community housing sector for all of the reasons that are commonly expressed. However, we oppose the winding-down, the cutting-back, the de-powering of Housing New Zealand. That is exactly this Minister’s intention. This bill is a means towards his vision of remaking Housing New Zealand as just another tenancy manager. We may as well get Barfoot and Thompson to manage the State housing stocks, because that is the Minister’s vision—that Housing New Zealand will be just another landlord competing in a quasi-contestable market for tenants and subsidies.

The Minister does not see a future for a strong, capable, Government-delivered social housing provider, just as Housing New Zealand is today. Labour does not support the Minister. It does not believe that growing the community housing sector by chopping up Housing New Zealand into little bits and divvying it out to the NGO sector is the way to do it. Labour believes that putting a roof over the heads of some of the most vulnerable New Zealanders is a core responsibility of the Government. In this bill Nick Smith is stepping away from that responsibility. We will not be voting for this bill.

It is a great pleasure to rise in support of the second reading of the Social Housing Reform (Housing Restructuring and Tenancy Matters Amendment) Bill. I would like to reflect on the speech from the previous speaker from the Opposition, Phil Twyford, on the bill. What a contribution that was. That was really rich, coming from that member who belongs to a party that could be classed only as the slum landlord that did nothing for this sector for 9 years on the Treasury benches when it was in Government. As we all know, the old model of massive State housing estates does not actually work. That is why we need to make changes to this model. We should not be putting all of our eggs into one basket, but that is precisely the problem with the way housing assistance has been delivered to those people who need it most in this country. We need to diversify the way we deliver housing assistance, and we are going to be providing the best service to New Zealanders. That is what this bill is actually addressing.

This bill is going to make fundamental and welcome changes to the way the Government delivers housing assistance to those who actually need it, by letting community housing providers play a bigger role. We have seen worldwide how community housing providers do a better job meeting those needs because they provide a wraparound service for their clients. Just take a look internationally—New Zealand is lagging in the community housing sector. We have less than 5 percent of social housing provided by the community sector. Compare this with Australia, where it is actually about 20 percent. Compare it to the UK, where it is actually about 60 percent of social housing. That is precisely why I am excited by this social housing reform bill, which will make a substantive shift in the Government’s housing assistance from a State housing to a social housing model.

Let us talk a little bit about the detail of the bill. Before I get along, I would like to talk about the misinformation that Mr Phil Twyford was actually talking about. I think he mentioned something about how Labour cannot support a bill that turfs out 80-year-old people from their homes. I mean, what a bunch of hogwash. It is a complete misconception. It is complete misinformation because the Social Services Committee made a number of technical and substantive amendments to the bill. The committee recommended allowing the Minister of Housing to identify people who will not be subject to reviewable tenancies. It specifically mentions vulnerable elderly tenants and disabled tenants. What this really means is that the bill allows the Government to clarify regulation so that vulnerable tenants, such as the elderly—they are the ones whom Mr Twyford talked about—would not get their tenancies reviewed. So the idea that they are going to be turfed out, the idea that Labour actually talks about, is utter rubbish.

The main objective of this bill is to improve access to social housing for those who really need it and to support people to become independent of State housing when their situations actually improve. Contrary to the Opposition’s deluded views, this bill is not about kicking out tenants, as I said. It is called the Social Housing Reform (Housing Restructuring and Tenancy Matters Amendment) Bill, and that is exactly what it is about—reforming social housing in New Zealand. This bill is going to change the way assistance will be given. Once this bill comes into effect, the level of assistance will not be dependent on whether the house is actually State owned but on the real needs of the family, on their income, and on the quality of the house. This is all part of the Government’s promise to deliver a better public service. This is something our Government has shown great commitment to—way better than the housing stock that the previous Government left behind, which was not even insulated and where people were living in cold conditions and getting sick.

This bill is also about facing up to facts such as that we have got more than 4,000 State housing tenants paying market rents, some of whom are on high incomes. We are actually doing something about that. It is about being fair. It is not fair that there are currently 2,100 families—about 6,000 people—on the Housing New Zealand waiting list with a serious need for a State home while there are tenants who can actually afford to find a decent house with their high incomes, but who happen to be living in State homes. It is also part of this Government’s commitment to better services for Kiwis. To deliver better services we will be making a record investment of $2.9 billion in Housing New Zealand for the next 3 years to improve access to social housing and to develop a pathway for New Zealanders in social housing to get independent. This matters to us because delivering housing assistance to Kiwis who need it the most is where we ought to be concentrating.

As I mentioned in the first reading of the bill, this facilitates housing in the right places, getting the right size and conditions, and getting it where it is the most in need—more targeted and efficient use of our resources. It also means getting results where we need to see them the most. It will not change the fact that housing will always be available for those people who need it, and for the duration of the time that they actually require it. Quite frankly, this bill will address the very issue that Labour did not have the appetite to actually fix. Let us not forget that when the Opposition members were in Government they did not do anything substantive to ease the housing issue. There was not even any review of the criteria for placement of people into housing, meaning that taxpayers’ money that could have gone to target those in need was used ineffectively. This did not help Kiwi families then, and it is certainly not helping them now.

Let us not forget the Opposition’s poor track record with leaky homes. It was our National Government that actually tackled this issue. Once again, it is this current Government that is tackling the big issues. I wholeheartedly support this bill and I commend it to the House.

It was interesting listening to Melissa Lee read out the research notes. What I got from that is that she thinks that if you tell a lie often enough, people might believe it. The lie that I thought was being told was that for 9 years Labour did nothing in housing. Well, that member was not around, I believe, during that time, but I can tell her that we spent 9 years fixing up after the great State house fire sale undertaken by the previous National Government. Maybe she was not aware of that. Maybe nobody told her that the previous National Government sold off 13,000 State houses and replaced very few of them.

She then went on to say that it is not about kicking people out of houses—that that is not what it is about. Well, I suggest that she might like to read the regulatory impact statement, which says this: “As at 31 January 2013, HNZC had 63,867 total tenancies of which 54,520 were identified as having been entered into prior to 1 July 2011.”—that is an important date, 1 July 2011—and: “About 80 percent of these are likely to qualify for desktop review.” This desktop review is to see whether they should be kicked out. The criteria for that are going to be very interesting indeed.

You see, this Social Housing Reform (Housing Restructuring and Tenancy Matters Amendment) Bill is about three things. It is about the income-related rent subsidy being extended to all social housing providers. I have no problem with that. It is a very good idea. But why have they not included local government—one of the biggest providers of social housing in New Zealand—in this? If you counted local government as a social housing provider, I suspect it would be more than 5 percent. If they are counting local government in the 5 percent, then why are councils not eligible in the extension of the income-related rent subsidy? That is a very good question, and I would like to put that to the Minister of Housing when I get an opportunity.

Here in Wellington, it is the local authority—it is Wellington City Council—that provides the largest number of social houses in this city. In fact, it is the biggest provider in New Zealand. Why would it not qualify for the income-related rent subsidy? It is providing very good accommodation after the previous Labour Government put in over $200 million in partnership with them—$200 million, Melissa Lee, that we put into a partnership with the local authority—to renovate those houses and those apartments to make them livable for many, many low-income Wellingtonians. That is the sort of thing that the previous Labour Government did. So I do not have a problem with income-related rent subsidy being provided to social housing providers.

I do have a problem with the reviewable tenancies of all State housing tenants. When you read the small print, yes, they are going to be concerned about people with disabilities and people who are unable to physically move, but where in this bill does it talk about the elderly? It is the older New Zealanders, who have often lived in the same State house for many years—and it is their home. It is not just a place where they lay their head. It is a place where often they have brought up their children. They have made it their home, they have put in the gardens, often they had to put in the paths, they put in the drapes, they put in the carpet, and they made it their home. These people are some of those who are going to be asked to move on when they have had their tenancies reviewed.

The third area is that this bill is supposed to make Housing New Zealand more effective and more efficient. Well, poor old Housing New Zealand underwent a big effectiveness and efficiency change under the previous Minister, Phil Heatley, so it was supposed to have already been made more effective and efficient. Some of us remember how that happened. The Government closed all the Housing New Zealand offices. That is how they became more efficient. So if you wanted to go and see somebody in a Housing New Zealand office, you rocked up to the door, and the door was shut. You could not even get an appointment to get into the office, because you had to ring the toll-free 0800 number to get an appointment if you were going to get through the door, and if they would open it. But people sat for hours and hours trying to get through on the 0800 number. It was the 0800 Nowhere number. So, talk about more efficiency in Housing New Zealand!

There are three areas in this bill. I have to say we are not going to support it, because although there are some good things in it, it is going to have a detrimental effect on many, many New Zealanders who need certainty and security in their housing.

One last thing: we already have a mixed model of housing. We have homeownership, we have State housing, and we have community and social housing. We could add to that, but you do not need to do that at the expense of State house tenants.

The Green Party will maintain its opposition to this legislation, the Social Housing Reform (Housing Restructuring and Tenancy Matters Amendment) Bill. I want to acknowledge the work of Holly Walker, who is currently on maternity leave, the Green Party MP who holds our housing portfolio, for her work on the Social Services Committee and particularly for the drafting of the minority report that is attached to the bill.

I just want to go through some of the provisions and issues that she has raised in that minority report, and also to remind the country that just earlier this year, less than 12 months ago, the Green Party released a significant housing policy that was designed expressly to deal with the issues of affordability. It is not a build programme; it is a programme of support and affordability, to increase and improve the affordability for families to purchase their own home, to improve the quality of New Zealand’s homes, and to improve the security of tenure for New Zealanders living in homes. That proposal, called Home for Life, included three provisions.

One of them was the progressive ownership policy, which is very similar to a UK Government - sponsored scheme over there. The Minister of Housing referred to UK examples of housing in his speech on this legislation. Progressive ownership is a shared-equity scheme where the Government, in partnership with other organisations—iwi, community organisations, and social housing organisations—build homes and continue with a persistent and consistent home-building programme in New Zealand. Some of those homes are set aside for State housing, some of those homes are set aside for management in social housing, and some of them, for example under Labour’s scheme, might be sold directly to New Zealanders, but a proportion would also be set aside for the progressive ownership scheme where people could slowly, over time, buy their own home. They would enter into an agreement with the Government agency that manages that. They would pay a small amount—effectively, pay a rent—to pay for the cost of the capital for the building of that home, and every week pay a little bit extra. So every week they are paying a little bit extra to purchase a home.

It is kind of like the old Department of Māori Affairs home loans and State Advances Corporation loans. Many of us were raised in homes where our parents bought those homes by capitalising on the family benefit. It is very much that kind of scheme, where the Government is building an investment. It is investing in families, and it is passing on to New Zealand families its own low costs of borrowing, so that all New Zealanders can have access to that. It is a way for people to build their own homes. In the UK those homes continue, through the affordability scheme. They are re-used for families, just like those first families, if they eventually want to move on.

These are the kinds of policy ideas that need to be incorporated into New Zealand’s housing law and regulations, but they are completely ignored by this Government because the Government’s sole intention, and it is represented here in this bill, is to remove itself from social housing. It is not to facilitate social housing, and it is not to increase social housing or improve social housing. The Government’s sole intention is to retreat from social housing, and it is doing so in a way that is full of spin.

This legislation that we are discussing today sets up a system whereby State housing, which the State currently manages, will be slowly moved over into the community sector. Instead of building a collaborative relationship between Government and the community sector, or Government and iwi—a collaborative relationship between all of the players—where more affordable housing is built, the Government is building a competitive environment where organisations will have to compete with each other for access to resources to improve housing affordability and build more houses.

This is at a time when we have a housing crisis. We know that there are at least 90,000 too few homes for the population in this country, and that number is getting bigger as the population grows and fewer homes are being built. We know that more and more New Zealanders are unable to buy their homes. Actually, do you know what? Those New Zealanders tend to be the middle class. The poor have always had real difficulty owning their own homes, but the homeownership rates for the middle class are plummeting, and they are plummeting because supply is so restricted.

Instead of building a collaborative relationship between the State and community and iwi, this Government is building a competitive one so that it can get out of the market because the Government does not believe it has any responsibility for this core piece of infrastructure. The Green Party believes that housing is core infrastructure. It is no less core infrastructure than the roads we drive on, the telephone wires we use to communicate, and the water pipes that bring us clean, fresh water. Housing is a human right. A decent society, a wealthy society like our own, a First World society like our own should have as one of its core principles that every single family in this country will be decently, safely, warmly, and affordably housed. That is not an outrageous principle to have.

💬 Dr Rajen Prasad: Fat chance with this lot.

I am afraid so, Mr Prasad. I am very disappointed that that is the case—that such a basic principle, that every family in this country is entitled to be decently, warmly, and safely housed, is somehow a principle that the National Government will not accept. It does not believe in this principle. That is why the Government is retreating from social housing, why it is, through this legislation, removing from Housing New Zealand Corporation all social responsibility for housing, why it is building a competitive model for affordable house-building, and why it is refusing to deal with the core issues that most affect housing affordability in this country and housing supply. A capital gains tax is one of those issues that this Government has absolutely refused to consider, even though it knows that it is one part of an economic tool that needs to be put in place if we are to improve housing affordability for New Zealanders.

One of the major issues in this legislation is the reviewable tenancies. A few years ago the Government put in place reviewable tenancies, where new State housing tenants would be subject to a 3-yearly review of their tenancy. It has not yet been 3 years. It has not yet been tested to see whether the renewable tenancy programme already in place is making any beneficial difference to those families who are the most vulnerable and the most in need of social housing. Yet, despite the complete lack of evidence about this and the effect of it—whether it is good or whether it is bad—the Government is intending to roll it out to all State house tenants across the country. What this does is it creates fundamental instability for the housing of families.

I have a case myself at the moment of a family who are in very vulnerable circumstances, where he suffers from a serious illness that will eventually kill him, she has been working, but just recently lost her job—she was made redundant—and they have a Child, Youth and Family child whom they care for and two children of their own, one of whom has a severe disability. These are the families that we should be prioritising. They are vulnerable families and they are doing their very best. We are very hopeful that with some intervention we may be able to make sure that she has a decent house. But why should she have to rely on the intervention of a member of Parliament to get what she is entitled to—decent housing—as a member of our community and as a member of our family? She should not have to struggle. But if she gets a State house, in 3 years’ time she is going to have her tenancy reviewed. She will have no security that she will have a home to live in, to raise her kids and to take care of her husband for the time that she needs it. Why should she not have that? Why should she not be entitled to that security and that decency? The Government wants to spend all its money on building motorways not homes.

We will continue to oppose this legislation. There are serious reforms that could be made to improve housing affordability for New Zealanders, particularly for our most vulnerable families. This legislation will drive more and more of those families into the ground, and more and more of those families into poverty and insecurity. We are opposed to this bill. Thank you.

I rise to support this legislation, the Social Housing Reform (Housing Restructuring and Tenancy Matters Amendment) Bill. I do so because it is part of a suite of initiatives that the National-led Government is working on—and has actually begun work on the ground for—to deal with housing issues right across New Zealand.

First of all, of course, people will be aware of the changes we have made to the Building Act to ensure that builders are up to par and able to deliver better housing, with their qualifications, and also changes to the structural rules around the construction of those houses. The Resource Management Act has had changes to consenting to streamline that consenting process so that developments can get under way sooner. We have also, as part of the suite of options, looked at land supply, making sure that not only is there new greenfields land for housing around metropolitan areas and some of our cities across New Zealand but also where housing is already built on large sections, those people can easily subdivide their quarter-acre and half-acre sections to provide more housing within city limits.

Interestingly, the Greens hate the expansion of housing out to green, sort of rural areas, and they push hard for densification, but the minute you try to do it—even in State housing, where you bowl an old, cold, mouldy State house on a half-acre section in order to create three sections and three houses—the Greens are right there opposing it, alongside Hone Harawira. That is pretty interesting.

Regarding building materials, Nick Smith has announced his concerns and his programme to address the issue of costly building materials in New Zealand. Of course, we have the upgrade of State housing; those State houses that were not insulated through the decades that Labour was in Government—those old, cold, mouldy houses—are now being insulated. Today we are talking about this proposition, which forms another initiative to address the issues in housing and the social housing sector.

There are some things that Labour did not do. You will recall that Labour never dealt with gangs in State houses. Do you remember the methamphetamine-producing gangs? Do you remember the gangs that would grab the pales from the white picket fences of their State houses and beat up the neighbours next door? Labour ignored the gangs in State houses. You will remember Labour ignored all those State house tenants who were subletting State houses—those shonky schemes that it never jumped on top of. You will remember Labour never insulated State houses. I believe Nick Smith is going to see the last State house in New Zealand that can be insulated, insulated this year, and I congratulate him on it.

You will recall Labour supported the idea—and it still supports the idea—of the State house for life. You can get a State house with four bedrooms—because you have three children—you can live in it for 20 years, they can all leave home, and you can sit in that State house by yourself, at 55 years of age, and in a job, with three empty bedrooms and a half-acre section, and not be required to make way for a family who is desperate for housing. How crazy is that? Labour ignores the fact that you are earning $100,000 a year—you can stay in your State house. It ignores the fact that there are three empty bedrooms—you can stay in your State house. It ignores the fact that you are on a half-acre section—you can stay in your State house. It even ignores the fact that you might want to shift into a smaller State house—it still will not shift you.

I support this legislation and I support what Nick Smith has done here. It is all common sense to those people out there who believe you should not have gangs cooking methamphetamine in State houses, you should not have someone in a State house for 50 years if they are earning $100,000, and you need to support the community housing sector. Congratulations to Nick Smith.

The Social Housing Reform (Housing Restructuring and Tenancy Matters Amendment) Bill is one of the most objectionable and patently stupid bills this Government has produced. It is an utterly misconceived and completely inadequate response to the intensifying New Zealand housing crisis—a crisis that the Government watched develop for 5 long years. Its priorities are saving money and reducing the size of State services, rather than ensuring that the needs of people—especially those at the lower end of the socio-economic spectrum—are adequately met.

New Zealand First is committed to the provision of a genuine social housing service by the Government as a fundamental responsibility, in order to ensure that people are able to buy a home, or for people for whom homeownership is inappropriate to have a fair rental related to their income and to have the stability in their lives that they deserve.

The social housing deficit in New Zealand is now huge. More and more Kiwis are unable to afford a home; many will never be able to afford one. Their need is for options for long-term rental housing, which in this country only the State can reliably provide for low-income people. National has never really understood social housing, and this bill proves it. Its legacy of social housing stuff-ups always has to be remedied by later more-enlightened Governments.

There are two categories for New Zealand First’s total opposition to this legislation: first, the abdication of responsibility for social housing provision to non-Government providers as a matter of social policy, and, second, the reviewability of tenancies in the heartless and socially destructive way proposed in this awful bill. The laying-off of social housing provision to such a large range of community housing organisations and to such a large extent as the 20 percent targeted by the Government will not solve our housing needs. It is unrealistic and it is risky, both socially and economically, and it is wrong in principle as a proper application of taxpayers’ money.

New Zealand First’s policy is that taxpayer-funded social housing must be met in these three ways: first, directly by the Government, through Government agencies—especially Housing New Zealand, not just as a landlord but as a full-responsibility social agency—to provide a comprehensive rental housing service, not just buildings. There are too few houses already to meet the need for rental properties generally, and especially for low-income people in the main centres. New Zealand First’s policy is to make rental housing affordable and accessible to these people, and to offer a range of options to meet all social needs. New Zealand First believes that it is unwise to confuse social objectives with property investment objectives in both the State sector and non-governmental organisations. The outcome would be risky, uncertain, and unlikely to be acceptable in practice. The State would be better to provide social housing directly and not rely so much on the NGO sector.

The second way is by local government, which should be capitalised with loans at very concessionary interest rates by the Government, so that there would be no burden on rates, to help provide a social rental housing service and also to provide public rental housing units to complement Housing New Zealand.

The third way is by a few well-qualified non-government providers that can prove the need for them and their ability to meet the need. There is a place for some of those organisations, such as those that provide refuges for women. There are others, too, such as Habitat for Humanity and the Salvation Army. But these are a discrete and relatively small area of need—nowhere near the 20 percent proposed by the Government. Some of these NGOs give little confidence. One in Queenstown recently lost its charitable status and others run at a loss.

The Government’s social housing policy reduces the scope of the operation of Housing New Zealand. It will transfer large sums of money to community housing organisations. But what about their competency? Can they be relied upon in the long term? Will they become a nightmare to monitor? Those organisations will own the housing funded or gifted by the Government, but how do we know it will be well spent and managed? There will be no State asset in return. What happens if a recipient organisation fails? Where do the assets go? How transparent and accountable are the processes for allocating funds to community providers? What safeguards and risk management have been put in place for the funds allocated to non-property community providers? Will they have enough competence in the housing market, when private investors have lost many millions of dollars in the building and property market themselves?

These are just a few of the questions left unanswered by this bill. The bill also contains new provisions for moving people out of State houses if they are financially able to do so. That should not be an objective in itself. Three-yearly reviews for new and existing tenants will lead to significant social problems as health, education, and community well-being suffer. There are good reasons for people, especially the elderly, to choose to remain in State house rentals, even if they are assessed as able to move elsewhere. People who have good reasons to stay are likely to be nudged out of State rentals, when it is not their best option.

The bill will allow Housing New Zealand to forcibly obtain information from people. Will it become the housing police? This is utterly objectionable policy. All this stress, especially for the elderly and for other vulnerable people, cannot be done in the lenient way asserted by the Government. I have heard some speeches by members opposite saying there will be no problem in this respect, but very few people out there in the world of rental housing actually accept that, for one moment. We in New Zealand First certainly do not. There is so much wrong with this bill and its whole worthless underlying philosophy that New Zealand First will certainly vote No.

You know when Opposition members are still in Halloween mode because they are getting out there with their bogeyman masks trying to scare ordinary Kiwis with their trick-or-treat speeches. Here is a little bit of the truth that they might like to hear, especially Mr Phil Twyford, who is a great member of the Lyndon Baines Johnson fan club. I am sure that people will know about that.

Let us get to the point. Here is the point. There is just one point I want to make. The member Denis O’Rourke has just read his speech—and that is the tragedy, when people who have not been a part of the select committee and all the deliberation just read their speeches. The issue is about this: the third sector—the third sector. We have the Housing Shareholders’ Advisory Group, led by Dr Alan Jackson. But guess what? Here are some other members you might like to know of: Diane Robertson from the Auckland City Mission, Major Campbell Roberts from the Salvation Army, Brian Donnelly from the New Zealand Housing Foundation, and Paul White from iwi development. Here is what they said. In 2010 they had a report. They had 16 recommendations. One of them was about the importance of ensuring that they had a third sector that met the needs of the social sector market. That is what they said—that is what they said. These are recommendations that have come from them. They said that there is no one silver bullet or magic bullet that will solve the problems. New Zealand must come up to international standards. That is the reason why they made the recommendations. There is the third sector, the housing sector, which truly can make a difference to the sector as well. Here is why it is really important.

The second thing members opposite did was talk about income-related rents. Annette King talked about the 61,000 State house tenants, and, yes, there are 4,800 who pay market rents. But do we know the number of people who are on a priority listing—those who come to our constituency offices, those who see us with absolute need? The number is 3,851. So tell me this. If you are concerned about the needs of those who are most in need, why would you not want to provide for them? For those who can, they should. That is what this review is doing. That is what this Social Housing Reform (Housing Restructuring and Tenancy Matters Amendment) Bill is doing. This is a bill that is absolutely meeting their needs. It has consulted and it has engaged with those who absolutely know.

We support this bill. We support this bill because it is a good bill, which the Minister of Housing has put forward. I recommend this bill to the House.

There is so much here that two or three members opposite have talked about that I could spend the next hour taking each one of those things apart. In speaking to this bill, the Social Housing Reform (Housing Restructuring and Tenancy Matters Amendment) Bill, I start with this question: why did Phil Heatley lose his job? Why did he lose his job? Because he was no good. He was no good, and today he reminds us about gang members in State houses.

💬 Simon O’Connor: I raise a point of order, Mr Speaker. I believe he is trying to huff and puff and blow the House down. I just wish he would quieten a bit for the hearing’s sake.

💬 Mr DEPUTY SPEAKER: Order! That is not helpful. It is not a point of order.

💬 Hon Simon Bridges: Oh, this is the best speech!

Well, that member is never helpful. And neither is that other—

💬 Mr DEPUTY SPEAKER: Order!

I am sorry, Mr Speaker.

💬 Mr DEPUTY SPEAKER: Members should not assume things. I now call Rajen Prasad.

On this side of the House, Mr Speaker, we are just so good at anticipating, so my apologies. I want to ask the Hon Annette King this question: where are those gang people whom Phil Heatley tried to eject? They are still in the State houses. They have not left. That is where they are. Phil Heatley was the Minister of Housing, and what he tried to do was very interesting. He was the person who said the Labour Government was a slum landlord. That was his entire housing policy—his entire housing policy—and it is no wonder he got the sack. Then he said: “Well, let’s put some more light bulbs in.” and things like that; not “Let’s build houses”—nothing like that. There was no real appreciation of the problem of those who are not housed.

So Phil Heatley was the Minister of Housing, and then he was gone. Then the Hon Annette King, as the Opposition spokesperson on housing, and the wonderful Phil Twyford began to really develop a housing policy that had some resonance. It was a housing policy about which people out there began to say: “Look, this makes sense. This is what we need to do.” All of a sudden the Government fired Phil Heatley and brought in the next spin merchant, the current Minister of Housing, and that is all that that Minister has been doing.

💬 Hon Annette King: He’s going to go.

He is going to go—absolutely. It must be his time to go. But I want to remind those three National members who spoke and are still in the House, including the last person who spoke, my friend Melissa Lee, that it was National that sold 13,000 State houses in the 1990s—13,000 State houses in the 1990s. It did not build; it just sold. That is the curse of that particular ideology that that side of the House internalises. So, really, when it comes to housing and a housing programme, it is about building, it is about working with other people, and it is about make sure that we actually give people a home.

Now, all of a sudden, the Government is interested. Of the two bills it brought to the House, one was to bully the councils, particularly Auckland Council, about accords. “If you don’t do it, we will make you do it.”, is what the Government said. So here is—

💬 Hon Chris Tremain: How are you going to push through 10,000 houses a year? I hope you don’t have to bully the council.

Well, I tell you, it is the Auckland Council—

💬 Hon Chris Tremain: How are you going to push 10,000 houses through a year without bullying the Auckland Council?

I ask the Hon Chris Tremain to go back and read the bill, because there is an override provision. That is how that bill would override the council. The Government would bully them. It is called the override provision, Mr Tremain. I do not think that that member knows the other Act that was passed, because if he did, he would not be raising those rather inane points.

💬 Hon Annette King: He’s gone.

He has gone. He has gone too. Well, he has definitely gone—honourable retirement, I think it was.

The other point I want to make is about renewable tenancies. Renewable tenancies sound very good, and if they were that good they would be widely supported. I tell members opposite to be very cautious with renewable tenancies, because the system that is designed in this bill, the Social Housing Reform (Housing Restructuring and Tenancy Matters Amendment) Bill, is a blunt instrument—[Interruption]—Mr Ngaro. It is a blunt instrument and the member should recognise it, because that member’s own people will suffer as a result of what this particular bill is going to do. It will be the most vulnerable who will be assessed every year, and who will they be? They will be the vulnerable and they will be the elderly, and these are easy pickings, Mr Ngaro.

💬 Hon Member: Easy targets.

Easy targets. Of course, this Government does not have any development plans. It really goes just for the easy targets. This is another version of its punitive approach to welfare. That is what it is. If the Government was really concerned that there are a number of people who are taking advantage of the housing system, it would come up with a well-thought-out proposal that could really begin to say: “Well, let’s go and have a look at those. Let’s see who they are, and let’s see whether we can enable them to buy the house, get into a home, etc.” We on this side of the House would not object to that at all, because that would mean people being housed in their own homes. That is what a decent society does, Mr Ngaro.

There is so much I could go on about in this particular bill. That side has not made the argument. This is another punitive piece of legislation. Of course, when we are in Government—after November next year; almost a year from today—we will have to fix these things up, Mr Ngaro. As I said, that is what we will have to do. On that note, I will finish. Thank you.

It is very hard to follow such a commanding performance from my Social Services Committee colleague Dr Rajen Prasad, but I will not trifle with the House as much as he did and waste the time of this very, very important place of parliamentary business. But I will recognise the work of the Hon Nick Smith and the work of a National Government, which actually is prepared to tackle the issues.

There are lots of protestations and there are lots of hand-wringing over a glass of chardonnay or two from those in this House who are quick to throw stones but not that quick to bring solutions forward. This situation with housing—in particular, in areas like Auckland—has been in the making for some significant amount of time. But the difference between this National Government, this National Party, and the Labour Party and the opposing parties, the parties that oppose this legislation, the Social Housing Reform (Housing Restructuring and Tenancy Matters Amendment) Bill, is that we act. We act in a measure that brings a suite of opportunities to the fore. There is no one single solution to the crisis—if we can call it that—that is confronting the community.

When push comes to shove, what the New Zealand public have recognised—try as those members might to manufacture a crisis and to jump up and down like Turkey Lurkey, saying that the sky is falling down—and what they find when they look at the polls is that not much has actually changed since the 2011 election. Not much has changed at all. The reason for that is that Kiwis have woken up to the difference between do-ey and hui. There is a whole lot of talk and not a lot of walk coming from the Opposition.

So I commend the work that has been done by the Minister. I also want to acknowledge all select committee members. Although we did not necessarily agree, we worked through this legislation. It is a good piece of legislation. It is a good step and a good measure amongst many that this National Government is bringing in to deal with this problem.

It is a pleasure to rise to speak to the Social Housing Reform (Housing Restructuring and Tenancy Matters Amendment) Bill, only in order to give the position of the New Zealand Labour Party, which has had a very long, strong track record of actually developing and improving our social housing in New Zealand, and just to place on record that every single time it is the National Government that starts to undermine the fabric of our really important housing sector. I do want to draw a bit of an analogy around some things that have happened in the past that are a little similar to this, because it is a warning that I want to make sure people hear. It is related to the history of things that were once State provided, then becoming run by very well-meaning non-governmental organisations—very well-meaning but under-resourced non-governmental organisations—then ending up in private hands.

The example I want to share with the New Zealand public, when we think about this issue, is actually what has happened in the rest home sector in the last 25 years. Once upon a time, right here in New Zealand, rest homes were, by and large, owned and operated by the State. That is right. It was actually the Government that owned and operated those important institutions that take care of some of the most vulnerable in our society. At a point in time—I think it was probably in the 1980s that this started—very well-meaning non-governmental organisations, mainly religious and welfare organisations, put their hands up and said they would like to be involved in providing that care. The Government of the day said: “That’s great. We will gift you, pretty much, without any cost to you, these rest home buildings as long as you run the services. We are going to give that over to you.” That seemed like an entirely reasonable and rational thing to do at the time, although some of us protested it at that stage.

But what happened next was what some of us had predicted for some time, which was that these very well-meaning organisations did not actually have the capability and the capacity to do the job in the way they really wanted to. Because they were religious and welfare organisations, they really wanted to take care of the vulnerable and the elderly to a very high standard. And when they found that they were not able to do that, many of them actually got out of providing rest home care. What did that mean? It meant selling to the private sector. So in a very short period of time, we had what were once upon a time State-owned and State-operated rest home facilities changing hands to become almost entirely privatised. And that is the state of that sector today. Why am I talking about that with regard to this piece of legislation?

💬 Hon Simon Bridges: I don’t know.

Simon Bridges cannot understand the analogy. I am just going to join the dots for Mr Bridges now. It is because that is exactly one of the things that is being proposed in this piece of legislation. What is being proposed is that Housing New Zealand properties can actually now become transferred into the non-governmental organisation sector. That seems like that might work very, very well. I know that those organisations had the best interests of their community at heart. They did when they started owning and operating rest homes, yet they found that over a period of time they could not sustain it in a way they wanted to.

Here is my prediction. I made a few predictions yesterday on the Melbourne Cup and they did not come true. I hope these ones may not either. My prediction is that these same organisations will struggle to provide social housing to a standard that they actually feel good about. That could mean that this social housing ends up in the hands of developers. In fact, I have been pointing out exactly this situation recently in Hamilton, where the Hamilton City Council has basically sold—not gifted but sold—pensioner housing, once owned and operated by the ratepayer, to a very good non-governmental organisation, a very good community sector.

I would actually support that if it was adding to the housing stock, and what I am really opposed to is when we have housing stock that already exists passing hands from being taxpayer owned and operated to the third sector and eventually ending up in private hands. That is a pathway to the privatisation of our important assets, but, more important, it is the handing on of these really important community commodities that help keep vulnerable people safe and healthy in our communities into the hands of corporates. It is never a good result when that happens.

The other reason why Labour is opposing this bill is that the bill will extend reviewable tenancies, which will see 3,000 people kicked out of their homes in the next 3 years—3,000 people—despite the Government’s promise that this will not apply to elderly or disabled New Zealanders. But how is the Government going to ensure that that is not going to happen? I cannot see in this piece of legislation how it can make sure that that is not going to happen to those 3,000 people. How is it going to ensure that those people are not going to be elderly or disabled New Zealanders? I do not believe that the bill addresses that at all.

So although this bill is good in parts, Labour cannot vote for a bill that will see senior citizens ejected from their homes. We cannot support a bill that will see some of the most vulnerable in our society ejected from their homes. Provisions to extend reviewable tenancies to all tenants will create needless stress, needless anxiety, and suffering for older New Zealanders, who are the people who least deserve such treatment and are less able to cope with it. We have seen no evidence that the Government has considered the likely health and social impacts of this provision.

Tenants in social housing are an extremely vulnerable group, who need a well-run social housing sector. A well-run social housing sector creates benefits for all New Zealanders, as we see the costs of homelessness and poverty on society reduced, but that is actually something that a Government should hold itself responsible for. Certainly, we here on the Opposition benches are absolutely determined to hold the Government accountable for ensuring that it looks after the most vulnerable in our society, but, sadly, what we see—and this bill will contribute to it—is the gap widening in New Zealand between the haves and the have-nots. The inequalities on a day-by-day basis are increasing in New Zealand, and it is through policies like this that those inequalities are increasing.

The Government seems to be in denial that there is even a housing crisis in parts of New Zealand. It does not seem to take this issue seriously. We had the Minister of Housing, Nick Smith, on his feet today in question time saying: “What housing crisis?”. Actually, he said that there were more houses being built than ever before. Never mind that most of them are replacing homes that have been wrecked by an earthquake—homes that do not actually add anything to the housing stock in New Zealand at all; they are simply replacing that homes that were wrecked in a natural disaster. So here we have a Government whose head is in the sand about the housing crisis. Its head is in the sand about the needs of some of the most vulnerable New Zealanders in our community, and it has come up yet again with a bill that falls well short—in fact, it has some very dangerous elements in it—and could well make matters worse. I am proud to be part of a Labour Party that is opposing this bill.

The member Sue Moroney, who has just resumed her seat, has clearly misunderstood the clear intent of this piece of legislation, the Social Housing Reform (Housing Restructuring and Tenancy Matters Amendment) Bill, because she talked about the potential for 3,000 people to be removed from their houses. Well, the fact of the matter is that these are State houses, which are funded by taxpayers. It is the Government, it is this side of the House, that is tackling the real issue of making sure that the people who are the most vulnerable in our community have the right-sized house in the right place and in the right condition, which is more than members on that side of the House ever did. I am proud to support this bill.