Overseas Investment Amendment Bill

I move, That the Overseas Investment Amendment Bill be now read a first time. I nominate the Finance and Expenditure Committee to consider the bill. At the appropriate time, I intend to move that the bill be reported to the House by 20 February 2018 and that the committee have authority to meet at any time while the House is sitting except during oral questions, during every evening on a day where there is a sitting of the House, and on a Friday in a week in which there has been a sitting in the House, and outside the Wellington area, despite Standing Orders 191, 193, and 194(1)(b) and (c).

First, I would like to thank Treasury, the Overseas Investment Office, and other agencies for their hard and quality work at short notice on an urgent matter. This bill implements the Government’s commitment to ban overseas buyers from purchasing existing New Zealand homes. The purpose of the Overseas Investment Act, as set out in its purpose statement, is to acknowledge that it is a privilege for overseas persons to own or control sensitive New Zealand assets. The Government considers that residential land and homes are sensitive assets, and, therefore, that overseas persons should be able to acquire them only in certain tightly defined circumstances where that acquisition is for the benefit of New Zealand.

We think it is the birthright of New Zealanders to own our houses as well as our farms. We believe that our homes should be traded on a New Zealand market, not an international one, and to us this applies at all levels of the market. Our best homes and farms should be purchased by our most successful New Zealanders, and our most modest homes should be also be purchased by New Zealanders so that as many New Zealanders as possible have a chance to achieve the Kiwi Dream of homeownership.

New Zealand First as well as Labour and the Greens believe those who are committed to our country are those who should have the privilege of buying our homes, and that they should not be able to be outbid by wealthier people from overseas. We know that more and more of the world’s wealth is accumulating in the hands of a very small minority—less than 1 percent. We know from the Panama Papers and from Piketty’s book Capital in the Twenty-First Century that many of these people pay low or no tax on their income overseas. In the face of that reality, the Government has the right and the duty to protect their local citizens from overseas accumulators of wealth impacting on the New Zealand housing market. Therefore, this bill brings residential land within the category of “sensitive land” in the Overseas Investment Act.

National said this could not be done. They said that we had to choose in this country between trade agreements and controlling who buys New Zealand homes. They misled New Zealanders before and during the election. Todd McClay said a ban would force New Zealanders to renegotiate many of our trade agreements, and we would likely lose some trade access as a result of renegotiations, which would harm New Zealand companies and Kiwi jobs. It was National who abandoned the prior consensus on trade. It was National who tried to wedge Labour by forcing us to give up on our belief in trade and/or our desire to keep New Zealand homes in a New Zealand market. And New Zealanders will now see that the current Government, the new Government, has shown them to be wrong, and shown the last Government, the last National-led Government, to have been either disingenuous or incompetent—and I think history shows the answer is probably both.

The changes that we will make will ensure that more New Zealanders own their own home, and that over time, fewer Kiwis pay rent to overseas landlords. It means that more can aspire to homeownership and have a stronger stake in their communities, as well as building their assets and wealth here in New Zealand. This bill recognises and reaffirms that it is not a right of overseas buyers to own a home here.

💬 Hon Dr Nick Smith: Whoever said there was?

National, effectively, did, Dr Smith. National said we couldn’t do it, and we have. National made no effort to leave the option open to future Governments, and we have opened a door. If this had not been done before the Trans-Pacific Partnership (TPP) came into effect, it could, in effect, never be done. What was happening was that National were trading New Zealanders’ rights to control who buys homes in their country down the river for ever, and they were pretending that there was no alternative option open to the Government. It was a disgrace.

Treasury’s regulatory impact statement correctly notes that this law has been hastily drafted.

💬 Hon Steven Joyce: Rushed.

Rushed—that’s correct, Mr Joyce; rushed because of the incompetence of Mr Joyce’s Government. Because National did not preserve the country’s interests under TPP, we’ve had to tidy this area of law up urgently before the Comprehensive and Progressive Trans-Pacific Partnership comes into effect.

We are keeping faith with New Zealand voters. Under this law, as we said—as we’ve always said—if you’ve got the right to live here, you’ve got the right to buy here. That was our line, and we’ve maintained this. Under this law, only New Zealand and Australian citizens, and permanent residents of both countries—

💬 Hon Simon Bridges: And Korea.

—living in New Zealand, will be able to buy an existing home in New Zealand. Now, Simon Bridges just said “And Korea.” Wrong again. You should have read your Cabinet papers, or made sure that you had Cabinet Minister colleagues who knew their business. They didn’t. Only New Zealand and Australian citizens, and permanent residents of both countries that are living in New Zealand, will be able to buy an existing home in New Zealand without going through screening from the Overseas Investment Office. Citizens will be exempted from screening regardless of where they reside.

Permanent residents of New Zealand and Australia, in order to be exempt, will need to be ordinarily resident in New Zealand. For residential land purchases, this means they will have to have a permanent resident visa and have resided in New Zealand for the last 12 months, and have been present in New Zealand for at least 183 days in that period. Effectively, that means they’ve got to be tax residents. They’ve got to have been putting their shoulder to the wheel of the New Zealand economy, if they’re not a citizen, rather than using New Zealand as a bolt-hole and not contributing to the taxes that maintain our roads, and our hospitals, and our schools, and all of the social services that make this a great place to live.

Residents who have not achieved permanent residence will be able to apply to the Overseas Investment Office for consent to buy a home, provided they show a commitment to reside in New Zealand. The scope of this test and criteria to determine the commitment will be defined in regulations. Applicants granted consent will be restricted to buying one home, which they must live in. If they leave New Zealand, then they’ve got to sell it within 12 months. Issues in respect of Singapore are being worked through. Anyone else will not be able to purchase residential land or houses to live in.

Overseas investment persons can apply to the Overseas Investment Office to develop residential land in a way that will benefit the country by adding to housing supply. In particular, they’ll be allowed to purchase residential land if they can demonstrate to the office’s satisfaction that they will increase housing supply through their investment in and commitment to sell the properties that they will build, or through expanding long-term accommodation facilities, such as a retirement village; or that they will convert land to a non-residential use, such as a commercial development or a motel, and they can show the development will be beneficial to New Zealand.

The new definition of “ordinarily resident in New Zealand” and the commitment to reside in New Zealand will apply to the screening of all transactions that include residential land, including land that’s already screened for sensitive land purposes for other reasons—for example, lakefront land over 0.4 hectares. The screening tests and compliance enforcement measures that are in the bill associated with the operation of the rules will be conducted by the Overseas Investment Office. The bill enhances information-gathering and enforcement powers of the office that are actually already needed in respect of other areas of investment screening.

In addition to the proposals in the current bill, the Government’s also investigating other potential changes, which, if necessary, will have to be done by Supplementary Order Paper, because we lose the space otherwise to do it once TPP comes into effect. This Government welcomes foreign direct investment that adds to the productive output of this economy, but investment in existing residential houses does not, and in the future will not be allowed.

Madam Deputy Speaker, you know that when a speaker rises to deliver a speech on a first reading, and then relies heavily on emotive and provocative statements, either there is something very wrong with that bill, or the bill itself is totally ineffective—and both cases apply to this bill today. In another time, we might have described it as a Clayton’s bill, meaning that it is something that proclaims to do something that it doesn’t. In this case it is a ban that’s not a ban. The exclusions that the Minister has spoken of are extensive. The provisions the Minister speaks of that are supposedly to tighten up have existed for a very long time. Further, while we know about Labour and New Zealand First having a generally xenophobic attitude to property ownership in this country, the facts about who buys land in this country do not bear out the suggestion that that alone is the cause for rising property prices in New Zealand.

Indeed, we’re now at a stage where many people throughout the country are finding that their equity was not quite as good as it was just a few months ago, because of the sort of rhetoric that we’ve just heard from the Minister this afternoon. I think it’s interesting to note that if you look at the last quarter’s real estate sales in New Zealand, there were only 3 percent of properties that were in part owned by foreign buyers. The vast majority of those were Australians, who this bill carves out and will no longer be reported on. So that tells you immediately that the actual number is probably even lower.

Then there are the carve-outs for people who supposedly are making better use of the land. The Minister mentioned residential retirement villages. Well, why is it OK for foreigners to own residential retirement villages, where New Zealanders buy occupation licences that give them so few rights that apparently the new Government is concerned about, to the extent that they’re putting up a member’s bill to try and change some of those things? It just doesn’t make sense.

I think when you look further into the concerns expressed by Treasury when they were doing the regulatory impact statement, that should start to ring alarm bells. While a lot of people like to sling off at Treasury—and I’ve been guilty of that myself, only on one or two occasions and generally quite right to do so—they are intelligent people who do consider things on the broader scale and in the best interests of New Zealand and New Zealand’s economy. When they say to a Government, “We have some concerns about this. We think the process is too rushed, and we think there could be some unintended consequences.”, then it’s important, on an issue like this, that the Government of the day listens. If the Government of the day won’t listen, as they aren’t, and they’re simply boxing ahead and putting the bill on the Table of the House and expecting us to deal with it today, then it becomes all the more important that there is a considered scrutiny by the select committee.

What we’re hearing is that they don’t want that. The Government don’t want that scrutiny. They want to turn around this bill by February. So the Parliament will only be back in session for a couple of weeks and the bill will be back in the House and no doubt rammed through its final stages. Well, we’re going to discuss that this afternoon. I think some of the other parties supporting this need to think very carefully about how they are going to present in that circumstance. These are parties that have long raged about due process being exercised in this country, but so far have participated in a record of a Government that has very little regard for due process, let alone transparency.

I want to particularly express concern about the statement made by the Hon David Parker, suggesting that this side of the House considered it an absolute right for foreign buyers to come into this country. Let me tell the House this afternoon that this side of the House has never considered it an absolute right for foreign buyers to come into this country and acquire land. The mere fact that this side of the House has been so assiduous in pursuing Treaty of Waitangi settlements is testament to the fact that we have never believed that there is an absolute right for foreigners to acquire land in New Zealand. The other side of the House appear to have forgotten that.

I also think it’s worth noting that this bill starts to put all the onus on people outside of the Overseas Investment Office for compliance. So people who are in conveyancing, real estate agents, any kind of land agency at all are going to be responsible for making sure that the person who is buying a property is qualified to do so. The fine for failing in that regard will be $20,000. Why would anybody want to put themselves in that position of risk? So what that comes down to is that this is some kind of a pernicious action designed to frighten off people from either seeking to sell their property to a legitimate buyer or to discourage those agencies to desist from that process. It might be someone wanting to sell their family home because they’re moving on to one of those rest homes owned by a foreign buyer, which apparently is permitted under this bill. On the one hand, they’ll be able to do that, but on the other hand, not able to get that sale because potentially the support services for them being able to make that acquisition will be fearful of the pernicious actions that could be brought down upon them.

I think the other thing that’s very interesting that I’d just like to touch on is the fact that in this bill there is also a provision for what’s referred to as a standing consent. Now, that means that a foreign buyer can come in and tell the Government—because that’s who they’re really talking to—that they have these intentions for land that they’re going to buy. It could be that they want to build the retirement village that I spoke of before. They might want to build some other kind of infrastructure asset. They might want to do some intensive farming. Who knows what that land use might be. If the Government of the day considers that that might be a good thing for New Zealand, then they can grant one of these standing consents. That will mean that that applicant then does not go through this long process. They simply go out and make the purchases they want.

So when the Minister comes into the House and says that it is a ban on foreign ownership of land and residential property in New Zealand, because the Government believes that that’s a right that should be exclusive to New Zealanders and New Zealand residents, it is a load of rubbish to think that that will ever be achieved through the provisions of this bill. It’s almost impossible for it to occur. So, just for a moment, imagine how many people might decide that these—what are they called again?—standing consents would be a good idea for them. Then they will go through and deal with the Overseas Investment Office at the moment, and what we know is that it is apparently a long process. It’s not something that gets rushed. It’s a process that does have a high degree of consideration to it, and we know also that not everybody gets through the hoop. So what that’ll have to tell us is that this office will need to be substantially more resource demanding.

We’re told, also, that the initial estimated cost could be $3 million a year—that doesn’t sound too much—but then it could rise to $10 million a year, and then more and more after that. So if one was to assume that the Government was going to recoup the cost of applications from applicants, that indicates an expectation that there’ll be far more applicants to buy land in New Zealand who are of a foreign nationality or tax status than we have at the moment.

This is not a good bill. It’s a messy bill, it reflects the fact that it’s been done at high pace without consideration for everything that needs to go into it, and, worse still, the Government’s desire to push it through with only the remotest and slightest select committee consideration. National will not be supporting the bill.

Apologies, Madam Deputy Speaker, for not alerting you to a slight change in the batting order. Part of what the honourable member Mr Brownlee talks about deserves my support, certainly the part about being vigilant against officials’—to borrow a term given to me by a former National Minister—treacle-riddled feet. And the member’s now standing. That’s very important, that we remain vigilant as Ministers. But this bill will pass, and I just want to remind the House: where do we get our mandate to make such a fundamental change towards property ownership in New Zealand and the numbers of non-Kiwis holding such a privilege? We fought an election on this particular issue.

💬 Hon Dr Nick Smith: And who got the most votes? Who got the most votes?

We brought to the attention of the public our desire to restrict the ability of international purchasers to bid Kiwis out of existence and to thwart the ambitions of garden-variety Kiwi households to become property owners.

Now, I know that certain elements on the other side of the House are still wending their way through the stages of grief, and we are unlikely to see an immediate cessation from the Nelson member, but the reality is we’ve been given the privilege of governing for three years, and a cardinal feature of this side of the House and their narrative is that there will no longer be the ability for all and sundry to rock up to New Zealand and to imagine that they can buy multiples of houses and leave them vacant and pursue a non-taxable gain whilst there are people living in cars and in other dire circumstances in Auckland.

So this bill will pass. Why are we doing it? Governments are entitled to make big fundamental calls, and this Government, through this bill, is exercising that right. Now, when the bill goes to the select committee, no doubt people will endeavour to change some of the provisions. Some might say they’re too restrictive. Some might say we shouldn’t let Aussies enjoy the privilege that we ordinary Kiwis have. That can all be teased through in the select committee, and that select committee will ensure that we meet the time commitment foisted upon us by that side of the House in relation to the ill-conceived Trans-Pacific Partnership. Now, being a supporter of international trade, my good self, does not mean that our rules and regulations should completely open the gate and leave Kiwis constantly outbid.

I won’t refer to any particular transaction that might be exercising the minds of us in the House, but know this: the housing market in New Zealand, the homeownership market in New Zealand, is now going to change. We are desirous of creating a market that is driven to suit, driven to fulfil, the interests of us Kiwis, of us putting our interests first before an unmitigated flood of people continue to bring their money here and continue to outbid Kiwis seeking the most simplest of opportunities: to house their families, their whānau, and their children.

It might be said that there is a case for expanding the rights of other migrants when they come to New Zealand to enjoy the privilege of homeownership. I say to their advocates, and I say to the other side of the House as they look for people who will continue to find reasons to oppose this bill—which will, actually, because of arithmetic and the coalition agreement, pass, irrespective of what select committee it goes to; irrespective of what mischief members of that select committee might get up to.

Now, the reality is once this bill gets there, this bill will actually affirm that New Zealand—unlike the other side of the House, this side of the House is going to affirm New Zealand is not for sale. That side of the House ran a political narrative. They ran an ideology where they were prepared to put Kiwis to the side in order to accommodate overseas interests at the expense of Kiwi interests. Those days are over. Now, in another three years we’ll have an audit—it’s called an election—but by that time this bill will be law.

Let me talk a little about Mr Parker. Mr Parker said we as a Government are particularly keen on seeing a continuation of foreign direct investment. For those reasons, as the House’s hard-working forestry Minister, it has been my desire, and we’re making a wee bit of traction, to ensure that people who want to come and invest in the country, in particular in forestry, have not only the opportunity but they have, not quite a primrose road, but the opportunity is there for them to come, invest in New Zealand, grow the forest estate, increase the size of the nation’s lung, to deal with the consequences of Mr Nick Smith and others failing on the climate change front for many, many years.

But I want to let no Kiwi leave their time whilst listening to this speech—that those days of overseas capital coming into the country in an unfettered form are over. Should applicants bear the cost of wending their way through the Overseas Investment Office process? Absolutely. Should the professional providers of services, such as lawyers, real estate agents, and accountants—well, it’s the last regime that imposed those costs on them anyway, through anti - money-laundering, so it’s not as if these professional service providers are strangers to the fact that they already have to provide that level of reassurance if they want to continue to trade in that particular service area.

In the process of the select committee, there will be particular concerns expressed: “Is this too cumbersome a process?” Now, the reality is, if you want the privilege of owning assets in our country, accept that for this category of asset the rules have changed. If you don’t like those rules, then you have an option to reflect your preferences in three years’ time. But in the select committee we are not going to be bullied by the other side of the House corralling, stimulating, and exciting people—

💬 Hon Gerry Brownlee: I raise a point of order, Madam Speaker. I think that is an extremely unreasonable allegation that’s just been made by the Hon Shane Jones. There is a select committee process; those processes are always held with a high degree of decorum, and for him to make the statement he has I think is deeply offensive.

💬 Madam DEPUTY SPEAKER: I thank the member. I must confess I was slightly concerned about some of the imputations in the Minister’s speech about the processes. Parliament makes these decisions, and select committees are the creatures of Parliament, and Parliament votes, in the end, on legislation.

Thank you very much. Yes, observing the sensibilities of the honourable member Brownlee, however, the reality is that after the select committee process has taken place—and it’s a load of nonsense to suggest that the select committee process, truncated though it might be, is demeaning the integrity of the House. That is not only fiction; that is to continue a line of reasoning that suggests that when that side of the House pursued that strategy, somehow it had a greater level of virtue.

The category of applicant who is a permanent resident is actually quite an interesting question, because there are variations and gradations of people who hold different migrant permits—if I can use it and visas in that term. But we have started, in this bill—and subject, as you pointed out, Madam Deputy Speaker, to what the select committee eventually reports back to the House and how the House actually votes—with a very narrow definition, because we do not believe that we should water down the privileges of New Zealand citizenship and the opportunities for Aussie residents coming over here, or permanent residents.

But, beyond that, it’s up to an applicant to make their case; it’s up to a submitter to make their case to the select committee, but that case will bump into a political reality. The political reality is that this side of the House fought an election to put Kiwis first. This side of the House is not going to back down just because of the ideological pretensions of our Opposition colleagues, and, as Mr Parker has said, the rules and the game have changed. We have not a doubt in our mind that we have a mandate to introduce this bill. We also have the numbers to cause this bill to rewrite the rules of fairness and equity in New Zealand, in particular as they pertain to sensitive land and, now, housing. The bill is a success and I’m sure it will pass.

I’d like to acknowledge the previous member Shane Jones’ contribution. I’ve always been a fan of Shane Jones personally, but can I say I was pretty disturbed by his approach to both the select committee and to this House in terms of respect for it, in terms of the attitude of passing this bill and declaring that it will go through regardless. We are going to have a subsequent debate about the time this bill spends at select committee, but the suggestion by just the second Government speaker on this bill that it is perfect as it is—that it has come to this House and that nobody should be persuaded of any different—does actually fly in the face of the way this whole idea was developed, which is strange in the very least.

I can remember back on 31 October when it was first announced. There was absolutely no paperwork at that time from the Government at all. It was announced at a post-Cabinet press conference. It didn’t have any details whatsoever. There were no Cabinet minutes. There were no Cabinet papers. There was literally nothing. At that stage, it became clear that it was a bright idea of Mr Parker’s, where he could see he was going to struggle with our trade agreements and so he decided to do a little run-around end game, and instead of actually banning residential house sales, he would instead just declare them as sensitive land under the Overseas Investment Act. Like a lot of these bright ideas that people come up with, when it actually comes to show time, they are a lot less than they seem. And so it is with this particular piece of legislation.

But don’t just listen to me; listen to Treasury, who are not prone to hyperbole. But it’s got to be said, this particular regulatory impact assessment is quite damning in Treasury-speak. Firstly, it notes on the very front page that “This version was prepared for consideration by Cabinet on 11 December … further policy changes were made subsequent to this meeting. The Treasury has not had an opportunity to assess the impacts of those changes.” So here we are with a bill that’s come to this House where the agency that’s responsible for preparing the regulatory impact statement says, “We’ve got no idea.”

They go further than that, actually. They say, “some of the design choices may be sub-optimal or have unintended consequences; the Overseas Investment Office will only have limited time to operationalize the policy; and [there will also be] limited time to educate real estate agents, conveyancers and the general public.” That’s the quality of this bill according to Treasury. It’s a fascinating little read, this regulatory impact statement, because it’s asked about the problem definition: “What problem or opportunity does this proposal seek to address?” The problem is that the Government’s announced it, and Treasury says, “Well, we have to implement it because it’s the Government’s 100-day commitment to ‘ban overseas speculators from buying existing houses’ ”. That’s the instruction Treasury was given. That was the extent of it. They weren’t even allowed to offer alternative policies; they were simply told: “Do this. Write up the report. We don’t really care that you don’t agree with it; we’ll just flush it through the system.” Now, according to Minister Jones, it doesn’t matter what people say at the select committee, it doesn’t matter what people say in this House; this bill is going through unchanged because the other side of the House has more votes than this side of the House. Well, that is very—if I could even use the term—arrogant lawmaking, before we’ve hardly started this Parliament. It’s very strange indeed.

In actual fact, there’s a whole range of things here that don’t make any sense at all. For a start, the whole definition of the problem is wrong—the whole definition of the problem is incorrect. The Labour Party, and New Zealand First in particular, over the last few years have maintained that foreign house-buyers are the problem. Yet, every Government department that’s come up and looked at that—including Land Information New Zealand (LINZ), which has now done some comprehensive data over a significant period of time—says the most overseas-based buyers, including Australians, make up of transactions is about 3 percent, and the most sellers make up of transactions is also about 3 percent. The net effect of these particular participants in the housing market is about nil. So the whole problem definition falls apart at that point.

Now, I appreciate there are many New Zealanders that think it’s a problem, which is why we go and get the data to ascertain whether it is a problem. I also can observe or reflect that, actually, there are some New Zealanders who might think it was a problem in the past. Actually, the previous Government did make significant changes in this area. If you go and talk to the real estate agents, they will tell you that the two most significant changes in this area have already been made: the introduction of a withholding tax on all sales by foreign owners to ensure they pay the correct amount of tax on their gains if they actually speculate, and also introducing the regular monitoring of foreign-based buyers through LINZ and requiring foreign buyers to be registered with the IRD.

If members opposite would go and talk to any real estate agent, they will tell them that those particular changes stopped foreign speculators—true foreign speculators, not just foreign buyers—from participating in the New Zealand economy. Sadly, what is often the way in politics, the rhetoric is still ahead of the reality. The rhetoric is—on the left and New Zealand First, wherever they position themselves—they’re still a problem, but the reality has long since solved the problem, and, yet, here we are.

Now, we’ll get, as I say, the opportunity to debate how long this bill should be spending at select committee, but there are a lot of things we need to look at. For example, apparently, because all residential property has now been classified as sensitive land, an apartment on the fourth floor of a building is now sensitive land, which is intriguing. I didn’t realise it was land at all, but, apparently, if you build an apartment, you have created land. Now that is exciting. I think I might go out and generate some land—persuade some investors that I could build a multi-storey apartment and we would then have some land.

But there’s a more serious aspect to that. We want to see apartments built, particularly in our biggest city. That means encouraging investors to come in and buy off the plans, and, in a suburb not far from where I live, that’s exactly what they do. Yet, now, they will not have as big a market to sell those apartments later on. That’s a significant issue.

Then we have things such as luxury lodges. A lot of people, investors from overseas—and I note that the Minister for Regional Economic Development glossed over this one—invest in luxury lodges. How are they caught? Are they caught in this process? These are the sorts of questions we need to ask.

Then we have probably the most telling aspect of this thing overall: the Minister of Forestry, who is also the Minister for Regional Economic Development, proudly stating that he’s been able to get a carve-out for forestry because forestry’s important. We want to attract investment in forestry; we just don’t want to attract investment in housing. Why would we? We don’t want more houses! Oh, hang on, we do. Hang on, Phil Twyford wants more houses but, unlike Shane Jones, he didn’t get to organise a carve-out for more houses. He got a carve-out for forestry. So we can go and live in the trees. The point is this: if, actually, there is investment required, we do somehow find an exemption. This could be described as the “David Parker (I Get To Give Permission About Who Owns Land In This Country) Bill”. That’s actually what this bill is all about. There are good investors and bad investors and the good investors will be determined by David Parker, and the bad investors can take a running jump because he doesn’t like them. And I actually don’t think that’s good for New Zealand.

There is a good case for people having the opportunity to invest, but, again, not in speculation. Let me remind the House, speculation has already been dealt to. This is now dealing with people who might live here for six months a year. Those people might want to invest in regional New Zealand, Minister Jones, but they’re not getting the chance to.

There is going to be lots to investigate about this rather shoddily put together bill, and I look forward to the debate where we discuss exactly how long it goes to select committee. Thank you.

E Te Māngai o Te Whare, tēnā koe. I am very pleased to be able to speak in support of the Overseas Investment Amendment Bill on behalf of the Green Party. As Minister for Land Information, I’ve been involved in the preparation of the bill, and was very pleased to announce some of its details with Minister Twyford last week.

I think the Opposition should realise that it is going to select committee and that submissions to the select committee will be listened to, they will be read carefully. But the problem that the Opposition has created for this Government is in its failure to deal with this issue of overseas speculation in houses in New Zealand—in its failure to recognise that there should have been action taken to protect New Zealanders’ rights to buy houses here from prices being inflated by overseas speculators. The Opposition said, during the election campaign, that it couldn’t act to close the loopholes here—that there was nothing it could do. This Government has decided to do something about it, and the reason for speed is, of course, the Trans-Pacific Partnership agreement and the agreements around that. There is a narrow window. We need to be able to have this legislation introduced and considered by the Parliament before that agreement is ratified. So it is all of the Opposition’s making—the need for speed with this legislation. But it is going to select committee, and can I assure Mr Joyce that the submissions and comments that are made at select committee will be carefully considered.

Again, Mr Joyce, it’s not Mr Parker that will be deciding on the day-to-day operation of this bill—another mistake. It’s actually the Overseas Investment Office (OIO) as part of Land Information New Zealand. This bill delivers on the commitment that Labour, New Zealand First, and the Greens made to bring house prices back within reach of New Zealanders. We want to make it easier for New Zealanders to afford a home, but offshore property speculators have been a factor in pushing up Kiwi house prices and pushing Kiwi homebuyers out of the market.

💬 Hon Dr Nick Smith: There is no evidence of that. That is not true.

Dr Smith is disagreeing with that. But in an unstable world, capital flows to areas where it’s seen as safe and secure for investment, and New Zealand is seen as a safe and secure country for investment. Now, that is a good thing. As Minister Parker said, we welcome overseas investment that brings benefits to New Zealand, that adds to our economy, that helps create jobs, and that gives us access to technology that we wouldn’t otherwise have access to. But capital also flows to where people get returns, and speculators have been investing capital here and that’s not good for our economy or for the well-being of New Zealanders. It drives up house prices, more than in Australia; it forces Kiwis out of the market; and, increasingly, the dream of homeownership for young New Zealanders has been just that—a dream.

National said, “Nah, can’t do anything about it. We’d breach the trade agreements. We can’t act.”, so they didn’t try. This Government is giving every effort to making a very good try to protect houses for New Zealanders and to reduce that pressure that occurs with overseas speculation, and we’re also taking action to strengthen the whole regime around overseas investment, so that the OIO is no longer a rubber stamp. We took the first step in that direction with the changes to the ministerial directive to the Overseas Investment Office in November, which ensured that any sales of rural land above 5 hectares needed permission. Previously, it was rubber-stamped. That’s changed.

This bill is the second step in the Government’s proposals and efforts to make sure that we tighten the regime around overseas investment. It’s a strong, effective, and united response—unlike the Opposition’s—because it’s based on our shared priorities as a Government for this country. It’s not about restricting or discouraging those who want to make their home in New Zealand and want to make a real contribution to this country. It’s about stopping overseas speculation, so that when house prices lift again, there’s not additional pressure put by these investors coming into the market.

So what this bill means is that New Zealand citizens and permanent residents can buy and own their own home without going through the screening process through the Overseas Investment Office, and so can those permanent residents who’ve been living in New Zealand for 183 days of the last 12 months. But other overseas investors and other classes of residence visa holders will actually have to go through a screening process with the OIO, and that will be if they can show that they’ve got a commitment to live in New Zealand, if they’re actually increasing the housing supply by building houses and then selling them, or if they’re going to use land and convert it to a use such as a retirement village, student accommodation, or other long-term accommodation.

Now, Mr Brownlee talked about the standing consents. That is a sensible provision in the bill to ensure that those overseas investors who are investing in things like this long-term accommodation or doing a number of subdivision and housing developments can actually get on and do that. They don’t have to go through the process each time, but they will have to show that they are of good character and meet the other tests in the Act.

💬 Hon Gerry Brownlee: What’s different?

It’s very different, Mr Brownlee, because at the moment, if you’re on a temporary visa—if you’re a student visa holder—you can buy land. At the moment, if you are a trust, you can buy land. This bill closes that significant gap that overseas trusts—where there’s more than a 25 percent control or influence by an overseas person—will actually have to go through this legislation. This closes a major loophole that the former Government left.

Mr Brownlee, this bill applies to land that’s classified as residential or lifestyle. So we did the work around the rural land, and now this bill’s dealing with residential and lifestyle land, and yes, it does include apartment blocks. Yes, it does include apartments in apartment blocks, because otherwise that’s creating a loophole.

So people who aren’t New Zealand citizens, who aren’t permanent residents, will have to go through this screening process, and the OIO is the most appropriate body to do that screening, because they’ve got a recognised process for assessing the fitness of people to invest in New Zealand—the good-character test—and they’ve got the skilled staff to do the job. Yes, it will cost more, but we need to invest more in the Overseas Investment Office if it is to do its job properly. There had been a small increase in the office staff under the previous Government, but there will be a bigger increase, obviously, to apply this legislation.

So there are three pathways to actually being able to buy a home if you haven’t got permanent residence—if you’re not a permanent resident. Those classes are being actually able to show that you’re going to live permanently in New Zealand and that you’ve got a genuine commitment to this country; that you’re doing a new build or development work, as long as those properties are sold; or that you’re buying residential land for development as a non-residential use.

So there’s a provision in the bill—which I hope the select committee will look closely at—around the regulation-making powers for Ministers. That will enable regulations to define any other categories of residence visa where the holders of those visas can apply to the OIO to purchase residential land, and the tests that would operate there. So we’re certainly open to discussion as to how those tests will work. We’ll look closely at the submissions that come in to select committee because we want to make sure that those tests are right, and we don’t want to discourage people who’ve got a genuine desire to live in New Zealand and contribute to this country.

This country has suffered long enough from an overseas investment regime that is loose and that has had a rubber stamp approach—an open gate to speculation. We are tightening that regime.

💬 Hon Gerry Brownlee: No, this is more loose.

Yes, we are—yes we are. The other measure in the legislation is increasing the compliance powers that the Overseas Investment Office will have—something the last Government did nothing about. That involves conveyancers needing to certify that to the best of their knowledge, the purchase is not inconsistent with the proposed rules, and it will mean civil penalties for third parties who are involved in contravening the Act. There will be the ability for the OIO to notify someone that the office has reasonable grounds to believe that they have acquired a property in breach of that Act, and then for that person to sell the property and no further action being taken. There will also be a greater ability for the OIO to acquire information.

The last Government failed to close the loopholes. The last Government wasn’t interested in the OIO having any teeth. This bill helps give them teeth.

Thank you, Madam Deputy Speaker. It seems to me that there’s been a discernible change in the dialogue around the degree to which we New Zealanders welcome foreign nationals. In days past, I think Auckland would’ve been seen as an urbane, welcoming, cosmopolitan city, and it was the regions—the provinces—that were probably a little bit cautious, a little bit conservative, about people that didn’t look and sound like them. I think, more recently, there’s been a complete flip-over. In Auckland, they are terrified of having more people, and yet, in the provinces, they are absolutely crying out—including, for migrants. They’re saying “Come on in!” to places like Rangitata and Queenstown Lakes and Southland, where we need those workers to help us out and we need their tourism.

I would’ve thought that the parties of the left would’ve defined themselves as the progressive, welcoming ones. But, more recently, we’ve had things like Chinese-sounding surnames and a number of other things, like calls, including from the New Zealand First Party, to slash migration and residence. But I would’ve thought that one call wouldn’t have come from one of the more thoughtful members on the other side, and that’s David Parker. Indeed, he has the distinction of being the Minister for Land Information who approved more foreign sales—more foreign sales—than any other Minister or Government in this country’s history. So, my, how the worm has turned.

I think he also had a reputation for being a thoughtful Minister who passes sensible legislation. Well, I’m sorry, but that reputation is in tatters with this bill. But he did reveal that deep-seated envy of other people’s wealth and initiative and entrepreneurialism. He couldn’t help himself but refer to the 1 percent. It’s an “Envy Bill”. But he’s also mistaken in a fundamental way in this bill. He said, “They’ve got to be tax residents. They’ve got to be making a contribution.”, as if people who have been here for a very, very long time but who are global citizens and travel a lot and are not tax residents aren’t making a contribution—I think that’s an insult to many of the wealth creators in this country. If they’re investing in productive businesses, if they’re paying GST, if they’re paying income tax—excise—then they are making a contribution.

Now, he also said an interesting thing: that if you’ve got the right to live here, you’ve got the right to buy here. Well, again, that is not correct either. It’s not actually correct in respect of the Overseas Investment Act right now when it pertains to the current definition of “sensitive land”. There are a number of people who have been permanent residents of New Zealand for years—25, 30 years—but who are truly global citizens. Indeed, as the Minister of Immigration in the last Government, we attracted those sorts of global entrepreneurs through three different visa categories: the global impact visa, which will bring in 100 of our youngest, brightest entrepreneurs at the start of their business life cycle, to set up businesses here in New Zealand and export them around the world. The chances are, despite being absolutely committed to this country, they may not spend 183 days here. We had the entrepreneur visa; we still do. We have the investor category visas, which have made a significant contribution: billions and billions of dollars of net investment into this country, which creates jobs. It creates exports, and it creates the sort of tax base that the Government uses to provide the social services that this country needs. None of those people, under this legislation, when it’s passed, will even be able to buy a house without jumping through a plethora of hoops.

Currently, Land Information processes overseas investment applications in an average of about five months. The application fee is presently about $22,000. That is the tip of the financial iceberg for anybody wanting to purchase land—sensitive land, lakeside properties, and outstanding landscape areas—if they are currently considered to be overseas buyers. But that’s the tip of the iceberg because there’s a heck of a lot of other consultancy costs and legal fees, and they go through that. We, obviously, invested more in the Overseas Investment Office to make sure that that process was sped up. But when one is buying a 300-, 400-, 500-hectare property on the banks of Lake Wanaka, it’s probably appropriate that they do go through those hoops. These are the guys who will come, set up their businesses, invest millions into this country, and can’t buy a bungalow in Parnell without asking Eugenie Sage for permission.

In fact, the irony of this is that those people—those non-residents—would be able to go and buy significant landholdings that don’t meet the current criteria for sensitive land but wouldn’t be able to buy an apartment in Queenstown. It’s ridiculous, it’s wrong, it’s rushed, and, ironically, it’s not even a ban. As Mr Joyce pointed out—

💬 Hon Shane Jones: It’s politics.

—the reason, according to the regulatory impact statement (RIS)—it is politics, Mr Jones. That is the most accurate thing that member has ever said in his political career. This is politics pure and simple.

It says, in the RIS, that the problem definition, as Mr Joyce pointed out, was that the proposal seeks to implement the Government’s 100-day commitment to “ban overseas speculators”. Well, it won’t do that; it will just put a massive, massive hurdle in front of them. They’re likely not only to not buy that house but many of them are likely to turn away and say, “Well, I’m not going to invest the millions of dollars I was going to in New Zealand, in the forest that Mr Jones wants to plant, in the hotels that the Minister of Tourism wants to build.” They simply won’t come.

Now, I don’t think they care too much about that, but what they do care about is urban development. The confusion, in this bill and in the RIS, about whether or not urban development is encouraged or allowed or disallowed is just that: it’s completely confusing. On the one hand, it says, “Well, if you make a net contribution to our housing stock, we’ll allow that.” But they won’t allow that unless you go through these massive hurdles—hurdles that aren’t currently in place for non - tax resident developers who are developing special housing areas all around the country. But the thing about this that worries me the most is in relation to hotel development.

The last significant hotel built in Queenstown is a unit-title development where the room owners lease back to the hotel managers but have a right to reside in that room for a few weeks a year. Now, that’s a reasonably common model for the development of hotels, and we are short of—what, I can’t remember—8,000 hotel rooms at the moment, and climbing, thanks to demand. Now, for rating purposes, those rooms are designated “residential”. So it would be caught by this new law as it is written. Most sites in Queenstown on which future hotel development is being proposed are zoned “high-density residential”. So, presumably, it would be designated “residential” for rating purposes and caught by the terms of this Act.

Effectively, what that means is that anybody wanting to come in and meet that massive demand for hotel development will not be able to do so if they are a non - tax resident without jumping through a massive number of hoops. Bear in mind that it won’t be one application for the hotel; it’ll be one application to the Overseas Investment Office for every single room in the hotel that is proposed to be owned by an overseas buyer. I don’t think even the super cautious in the party of “the Chinese-sounding surname” intended that to be the case, but here’s the problem, and we are going to debate this at the end of this first reading: the shortened report-back date gives us precious little opportunity to understand how many other hand grenades are deeply buried in this legislation.

I have no doubt, in the short time that I’ve had to analyse the bill and talk to people in the development industry in that part of the country, that this is clearly an issue that has to be dealt with. I’ve got no doubt that there are many, many more concerning aspects of this that are simply going to turn people away from investing in New Zealand. The house tail will wag the business investment dog if we’re not very careful. These guys will take their cheque books and go somewhere else. They love this country, but if we tie them up in red tape in the way that this bill will currently do, we run the risk of completely undermining the very thing that we want to do, and that is to make this country better for New Zealanders.

The intent is flawed, the thinking is flawed and simply wrong, and this bill is bad. We must oppose it.

Thank you so much, Madam Deputy Speaker, for this opportunity to speak on this bill, and I’d like to thank and acknowledge the Hon David Parker for all of his work in bringing this legislation to the House. I’d also like to thank the Overseas Investment Office as well as Treasury for drafting this legislation and having it in front of us.

The Overseas Investment Amendment Bill puts in place one of our promises for the first 100 days, and it will have a significant impact on managing the demand for housing and reducing speculation in our housing market. We are in this position of having to implement one of these policies, which is one of many that we’re introducing—but it is to address the housing crisis that we find ourselves in.

This bill is about restoring the Kiwi Dream of homeownership for New Zealanders. The objective of the Overseas Investment Amendment Bill is to ensure that our housing market here in Aotearoa New Zealand is shaped primarily by New Zealanders. We cannot continue to have foreign speculators buying up our houses that should be open to New Zealanders, to New Zealand families, and to New Zealand’s first-home buyers, first and foremost. Allowing this to continue is the equivalent of pouring oil on to the fire that has become our housing market, after the last nine years of the previous National Government’s neglect in the housing area.

The goal for this policy is to ensure that our housing market is shaped by New Zealand buyers. This will make our homes more affordable for New Zealand’s first-home buyers, while also supporting our efforts to build a more productive economy, by helping redirect capital for productive uses.

We welcome foreign investment. We welcome foreign investment that brings benefits to New Zealand. However, we would like to encourage foreign investment where it adds to our economy. Investment in residential land by those who do not have a right to reside in this country indefinitely, and have absolutely no intention of living here, does not contribute to this objective. The new investment legislation that we’re proposing brings residential land within the category of sensitive land under the Overseas Investment Act. This will not affect New Zealanders. It would not affect New Zealand citizens, regardless of whether they live here in Aotearoa New Zealand or if they reside overseas. New Zealanders will continue to be able to buy houses without any screening from the Overseas Investment Office. New Zealand permanent residents, as well, will be able to buy houses if they’re living here or if they reside overseas. At least, if they’ve been present in New Zealand for at least 183 days over the previous 12 months, they will still be able to buy a house here if they’re permanent residents.

One of the things that the Labour - New Zealand First - Green coalition Government would like to do is address the fact that our whānau, our brothers and sisters, who live and work here in Aotearoa New Zealand do not currently have the opportunity to be able to buy affordable homes. We want to ensure that they are not continuing to miss out on buying affordable homes. We know that the existing supply of homes, especially affordable homes, in this country is really, really short. We know, from the numbers that we’ve seen as soon as we have gotten into Government, that we are short by at least 71,000 homes across Aotearoa New Zealand. The legislation that we’re introducing, as I said earlier on, is one of a suite of policies to address that. We want to make sure that the housing market in New Zealand is shaped by those of us who live here.

Investment in bricks and mortar by people who do not live here, nor have any intention of moving to permanently live in Aotearoa New Zealand, does not benefit our economy. Auckland is now the fourth most expensive place in the world to buy a house—10 times the median household income. And we know that the average price of a house now in Auckland is over $1 million. This, of course, has happened over the last nine years.

One of the reasons, of course, why we are introducing this legislation, and making sure that it goes to a select committee and that we get the input from the public, is also because of the timing in terms of the Comprehensive and Progressive Trans-Pacific Partnership agreement. We want to ensure that this legislation is passed prior to that coming into force.

As I said earlier on, we are open to overseas-based buyers purchasing our land for development purposes, but we cannot and we will not continue to allow them to purchase our existing homes, because we are already in severe demand for houses for our own citizens. So overseas purchases will need to be screened, they will need to be approved by the Overseas Investment Office, and in practical terms this means that foreign buyers will not be allowed to buy residential properties. However, they can buy land and they can build a new house on that land, and in doing so they will add to the overall supply of houses in Aotearoa.

This legislation gives us an opportunity to make good on one of our promises and, you know, our coalition Government—we believe that delivering on our promises for the good of all New Zealanders is a good thing. Owning a home is a privilege—one that we want to ensure all New Zealanders have access to. We know that this legislation will help make homes more affordable for all New Zealanders, especially our first-home buyers.

Speculation is playing a role in the rising housing costs in our country, and this legislation will be one way of ensuring that we take the heat out of the housing market. This is, as I said earlier on, just one part of a much more comprehensive plan of approaching the housing market, which includes increasing the supply of affordable homes, ensuring that we have public housing that is affordable and available for people, ensuring that we have urban development, and ensuring that we address homelessness—homelessness; we know we are now number one in the OECD in terms of rates of homelessness. We would also like to ensure that there is an improvement in the quality of housing for all New Zealanders.

This bill is not about deterring genuine people who wish to move to and live and reside in Aotearoa New Zealand on a permanent basis. We welcome all of them who want to come and live and work here, to contribute to our economy, but, as I said earlier on, they’re welcome to come here, buy a piece of land, and build a new house.

One of the speakers earlier on, the Hon Steven Joyce, talked about how this legislation will not work. Well, there are several countries that have already introduced legislation similar to this. Our neighbour, Australia, has passed similar legislation to minimise the effect that foreign speculators have on their housing market. Canada is also another country that has done the same thing. In the case of our Australian counterparts living in New Zealand, we intend to treat Australian citizens and permanent residents in the same way that New Zealand citizens and permanent residents are treated under this Act. What I mean is that this legislation will allow us to give the same benefits to Australians here in New Zealand as New Zealanders get across the—

💬 Hon Tracey Martin: The Ditch.

—the Ditch, in Australia. This Government is very keen to receive public submissions on this bill, including feedback on how different New Zealand residents are treated. It has been necessary to balance the impacts on people that are going to impact and contribute to our society overall.

Our underlying commitment under this amendment that we are introducing is that we have a right to live here. When you have a right to live here, you should also have a right to buy here. With this change we hope to grant more New Zealanders the ability to purchase homes in our country. This change will impact not only our first-home buyers of today, but in addition it will affect first home-buyers and families in the future. Thank you so much.

Madam Assistant Speaker, thank you. If the Overseas Investment Office was a brewery and they asked the Minister responsible, Eugenie Sage, to organise a party there, I don’t think that she could do it, and that’s quite worrying, although—I do accept that she’s not here now—the Hon Shane Jones would. Every single decision on every single house sale will have to go before that Minister, and that too is very, very concerning. But, you see, Madam Assistant Speaker, the reason every decision must go before that Minister is because this is not a ban. If it was a ban it wouldn’t have to. But in the case where these decisions do need to go before her, it is not a ban. So when the Minister, when he introduced this, becomes flustered during the speech to introduce a bill and then wants to rush it through as quickly as he can during a holiday period, with an extremely limited time for the public to have their say in select committee, we know that we’re in trouble. And when Treasury has significant concerns about the effectiveness, or lack of effectiveness, of the bill, and calls into question what it is trying to achieve and whether in fact it will do that—are there unintended consequences?—we know that there is real trouble.

When the Government is more interested in delivering that feel-good factor that started a couple of years ago with the Chinese-sounding names saga—which was heavily discredited, we know—and when they’re willing to do all of this just before Parliament rises, risking trade access and international relationships, then that’s reckless. All of that was David Parker in this House today. You see, Madam Assistant Speaker, this is not a ban; it’s just more process. That’s OK if the Government wants more process and more cost and to send that signal, but when they dress it up as a ban, it’s David Parker who is being disingenuous.

It does risk relationships, and it does risk trade deals. We know that because of the backtracking over Singapore already, and I’m going to come to that in a moment. But, actually, this is a badly drafted piece of legislation that comes from an ill-founded idea based on a preconception that the Chinese are here, buying up houses everywhere and not living in New Zealand and nobody that moves here to invest is contributing, and has been dreamt up in a back room by David Parker, after receiving official advice, which he also received when he sat on the Foreign Affairs, Defence and Trade Committee, when the Korea agreement went through and when the Trans-Pacific Partnership (TPP) legislation was put forward. The officials told him that a ban would ruin trade deals and put at risk our international reputation, and harm New Zealanders overseas when it comes to the trading relationship that they had—well, he’s found a workaround. It’s not a ban; he’s found things that he thinks, sneakily, will be OK with our international partners, and he’s rushing it through the House because he said it needs to be done before the TPP agreement is concluded.

So a simple question for Mr Parker as the trade Minister: just when is that TPP deal going to be done? Because, one, New Zealand First doesn’t want that deal to be done—

💬 Hon Tracey Martin: CPTPP.

They’ll do everything that they can to get in the way of it, and then they won’t vote for it—the TPP. Now we hear “Comprehensive and Progressive Trans-Pacific Partnership”, but I ask the member opposite: if we put the words “comprehensive and progressive” in the front of New Zealand First, are they progressive and comprehensive? Or are they just only a party that scraped over the line with 7 percent and couldn’t even win a seat in New Zealand. You can rebrand, you can change the name of something, but I’ve got to say that, ultimately, when it comes to the reason that David Parker says he must rush this through and introduce it here because of TPP, when is it going to be done? Because New Zealand exporters would rather see him fighting for better access overseas, not finding a workaround because of the advice he’s had from officials who say this is a very bad idea and would ruin trade deals and stands opposed to trade deals overseas. They want him over there fighting for better access for them.

Why is it that Australia is exempt, if it doesn’t ruin trade deals? And nobody buys into this, you know, that we’re treating Australians the same here as Kiwis are being treated in Australia. Because the first opportunity the new Government had, and the Prime Minister had, to treat Australians the same as Kiwis are in New Zealand, she backtracked and ran away from it. We’ve seen nothing from this Government other than a bit of hyperbole that says, “At the moment, we’re exempting Australians because they are so good to Kiwis.” Well, if it didn’t cut across a trade deal, they wouldn’t be exempting them.

Then we heard, on the first day, “Well, Singapore may be a little bit of an issue, but we can work that out.” And last week, in this House, the Minister of Foreign Affairs—and, day in and day out, this Government—has been backtracking as fast as they can. If they point towards the South Island, they’re backtracking so quickly they could be in Singapore to explain it to them themselves, because the one thing they didn’t do when they made their great big bold announcement of the ban that’s not a ban was tell Singapore they were doing it. And I know, and this Government knows, and the foreign Minister certainly knows, the Singapore Government—a very good friend of New Zealand—is extremely angry with them, and that’s why we’re seeing backtracking now, and, all of a sudden, Singapore will probably have to be exempt, but don’t worry, we’ll work this through!

Well, here’s a prediction: Korea will be next. And the reason Korea will be next is because if the Government says this is a ban, the trade agreement with Korea says you can’t have a ban. However, that’s the advice the officials would have given. The reason Mr Parker turns up to this House to sneak this through quickly is because it is not a ban; it is just process.

After that, what about China? Well, here’s another prediction: if this current Government is going to say, “This is a ban, and it’s going to affect China as well.”, they’re going to have to give something up during the free-trade agreement upgrade negotiation with China. And here is my prediction: if they’re not going to change their position on China being included—and that’s for them; that’s their business—they’ll have to give something up, and I think that will be better dairy access for our New Zealand dairy farmers into that very important market. They won’t get to have it both ways. I predict here today that they will have no gains on dairy, and then they’ll say, “Well, there’s a very special or particular reason for that.”

We know, in Auckland, that the property market director of the Auckland institute of property said that foreign buyers hadn’t been an issue for some very many years. The reason for that is that the last Government put in place a lot of measures that have had an effect. We know that of all of those measures—having to register with IRD, having to get a bank account and going through the full money-laundering checks and balances—if you sell within a period of time, you have to pay tax up front and then claim it back. We know this is having a big effect, because only about 3 percent of houses sold in New Zealand are bought by foreigners—about the same, more or less, who are also foreigners selling during the same period of time.

But when you take those Chinese-sounding names that the last Government spoke about and you look at the information that’s being collected and you take out those Australians, because the Government has said they will exempt Australians, and you take out the New Zealanders who live overseas but are not tax residents, who would be included in that, the number of foreigners actually buying, particularly from a country like China, is extremely small. So the feel-good factor in this bill is something that the Government is pushing hard on, running the risk of international relationships and also trade. But here’s a question that needs to be dealt with in the select committee—but I think there will be no time—they’ve said that New Zealand citizens will not be covered by this legislation. So how about the New Zealand citizen who’s living overseas and is married to a foreigner, and they’ve bought a house in that country? They’re selling it and they’ve decided to move home to make New Zealand their home with their Kiwi kids, and that foreigner has not been in New Zealand for a year, has not got residence yet—will they be able to buy a family home before they move back?

The answer to that is “No.” So what you’re actually saying to Kiwis overseas, in another country, who want to move back with their Kiwi kids and their spouse who happens to be a foreigner, irrespective of their name, is that they can’t buy a family home before they move back unless Eugenie Sage says so. And I say it to you again: if the Overseas Investment Office was a brewery, that Minister couldn’t organise a party in it. Thank you.

I understand this is a split call. Willow-Jean Prime.

Thank you, Madam Assistant Speaker. Thank you for this opportunity to speak briefly, in this split call, to the Overseas Investment Amendment Bill. I’m pleased to stand here and talk about this bill, and to talk about this issue that was actually raised with me during the campaign. It may be that it is simply anecdotal evidence that people are relying on, but it was certainly a concern that was raised with me in the Northland electorate, around foreign buyers buying homes in New Zealand, and concerns around rising homelessness in our region.

So what is the problem? The Kiwi Dream of homeownership is slipping away. Only a quarter of all adults under 40 own their own home, compared to half in 1991. Homeownership is at its lowest level in 65 years. Out-of-control house prices are putting homeownership beyond the reach of middle New Zealand. Kiwi homes should not be gambling chips for overseas speculators.

I want to talk about Māori homeownership. The rates of Māori homeownership and Pasifika homeownership have also dropped between 1991 and 2013 by 32 percent and 38 percent respectively. The failing housing market is leading to stark inequality between old people and young people, and the rich and the poor, and it is harming the health of Kiwis, the country’s productivity, and the Government’s books. There are wider social costs, including costs associated with overcrowding and homelessness, and poor educational and labour market outcomes.

Now, there’s been some talk this afternoon about the numbers, the percentage, and, quite frankly, we simply don’t know, and we need to collect real data. And, as has been pointed out, Treasury, in their analysis, said: “Analysis on the likely impact of this policy is constrained by a lack of empirical data, including around current levels of overseas investment in the housing market.” What I have seen from the research that I have done is we simply don’t know, and it could be between 3 to 20 percent.

This is not a silver bullet to our housing crisis—this one bill that we are introducing. However, when you look at it in terms of a wider range of Government policies that we are looking to introduce to address our housing crisis, including the building of 100,000 affordable homes for first-home Kiwi buyers; stopping the sale of State houses; increasing the State housing stock; extending the brightline test; ending the tax loophole; warm, dry, and healthy homes; and a dedicated policy for better homes for Māori—when you look at all of these in totality, it is going to have a huge impact and be a huge benefit to our issue that we currently have around homelessness and our housing crisis in New Zealand.

This Government is prioritising homeownership and housing ability for all New Zealanders. How do we propose to do that? Well, I talked about several initiatives that we are looking at, but in terms of this bill, the purpose of this bill will mean, for practical purposes, that foreign buyers will not be able to buy residential property unless they are either increasing the number of residences and then selling them, or converting land for other use. They will need to be able to show that this will have wider benefits for the country. New Zealand’s housing market needs to be shaped primarily by New Zealanders. Investment in residential land by persons that have no right to reside here and have no intention to live here does not achieve that objective.

I am a member of the Finance and Expenditure Committee and I look forward to this bill coming to our select committee. I look forward to hearing the submissions that we will receive from the public. This will give the select committee the opportunity to make sure the regime is set appropriately so that people who want to make New Zealand their home are not discouraged and New Zealanders can have the opportunity to comment on this bill in the select committee process, Kia ora.

I call Andrew Bayly—five minutes.

Thank you. It’s a pleasure to be talking on this bill, and this is a bill that’s got a feel-good factor to it. It’s a populist bill, in my view, and a number of my colleagues have already highlighted some of the philosophical differences we have with this bill, particularly—contrary to many of the misguided participants in this House who have said it on a number of occasions, the Land Information New Zealand records show that only 3 percent of sales are to foreigners. The other aspect is that the National Government has already implemented a whole raft of changes, and we’ve heard about some of those, around the foreign buyers having to get an IRD number if they’re going to buy a house; the introduction of a two-year brightline test, which is an increasingly stringent requirement on foreign buyers; the introduction of a tax—when they buy a property and sell it, they are required to pay resident withholding tax—and, of course, we’ve implemented a number of the Shewan recommendations around foreign trusts.

What I want to focus on is some of the mechanisms proposed in this bill, because I think they highlight some of the difficulty in terms of the practicality around how this bill is actually going to work. Just to go back a second, the current Overseas Investment Office (OIO) rules relating to sensitive land have a two-stage test to them. The first one is the “investor” test, and a person must demonstrate—and I’m talking about a person being a foreigner—appropriate business experience and acumen, financial commitment, good character, and comply with certain Immigration Act requirements. The second test is the “benefit to New Zealand” test, which is a general test around creation of jobs, increasing investment, and environmental and other factors. And, of course, it applies to non-rural land greater than five hectares, and, in regard to land with anything regarding water or historical or Māori influence, 0.4 hectares.

So what this means—and under the current OIO rules—is the process is that for any foreign buyer, they must get prior approval and they must have regard to, if they look at a piece of land, what is the historical significance of that land. If it’s got anything to do with water, it will inevitably require a report on it. It will require a wai tapu report if there’s any consideration of that issue. Often, these reports cost a lot of money. It’s not unknown for many of these applications to be $100,000 and involve a lot of lawyer time, accountants’ time, etc.—very expensive, and the process for approval takes a heck of a long time.

So my issue with this is, first of all, the need for these people to get prior approval—and so how are they going to enter auctions? The second one is the cost to the foreigners that are going through that process. The third one is the cost to the OIO, and we’ve seen the reports to Treasury around what that’s going to incur, which will be significant. And the fourth thing is waiting for the Minister, in her determination, to eventually come round and actually make a determination. I think this whole thing is going to get bogged down through the lack of practicality of working through the many applications that will come through and the process relating to that.

The second issue I’ve got is around the definition of “lifestyle block”. The test is that a lifestyle block is whether it’s predominantly used for residential use. In my area where I live, South Auckland, I’m surrounded by lifestyle blocks, and the issue is “Are they economic units greater than or less than five hectares?” Of course, many can argue that growing flowers or some horticulture or even having racehorses—that makes them very, very economic, and so I think that is an area of confusion, and, of course, that creates an area for loophole for foreign buyers. So even if you wanted to stop them, I think that’s a possible area of confusion.

The third area is around the responsibility on conveyancers to certify to the best of their knowledge that the purchaser complies with the new rules. So I think in the select committee we will be inundated with real estate agents, lawyers, etc., coming to see us, absolutely against the issue of them being required to go through this process to attest that every transaction has met that test, and, of course, there are increased financial liabilities in this bill.

So I have a lot of difficulty with this. I think it’s going to be a difficult bill to implement, and I don’t think it achieves anything other than making sure that the coalition Government has a feel-good factor around it.

I apologise—the member’s time has expired. I call Jamie Strange. I understand this is a split call—five minutes.

Is it a split call or is it 10 minutes?

💬 Kieran McAnulty: She’s the boss.

Yes, OK. I am proud that this Government are putting Kiwis first. If I walked out to Lambton Quay and I stopped a hundred people on the street and I asked them “Do you want our homes kept for Kiwis?”, 99 percent of them would say yes.

💬 David Seymour: Is that a scientific sample?

Absolutely. I’ll give you the results later. Now, some people would say that those out there, outside of this House, would not understand an overseas investment bill if they tripped over it in the street, but I believe that we need to listen to New Zealanders. Look, if we look at Hamilton, we’ve got 42 percent of Hamiltonians who are renting. They would like to get into a home but they’re unable to, and that’s because of the rapid house price increase over the past few years. By bringing this bill in, included in a suite of housing policies, we will make housing more affordable for people again.

One of the key reasons I got involved in politics is because I want my children to have a good future. I want my four kids to be able to afford to buy a house one day. I want my kids to have a good public health system; an education system that’s diverse, that works for all of them. [Interruption] Look, the member Mr Bayly spoke about—actually, it was one of the members over there—looking after Kiwis—

💬 Hon Member: Which one?

The blond one—I don’t know his name. Ha, ha! The member over there talked about Kiwis living overseas, and so all of a sudden now you care about Kiwis. All of a sudden now you’re looking after Kiwis—

The ASSISTANT SPEAKER (Poto Williams): Excuse me, don’t bring the Speaker into the debate.

I apologise. I apologise. All of sudden now the members care about Kiwis where for nine years in Auckland they let house prices go absolutely crazy, where Kiwis couldn’t afford to buy houses.

My wife and I bought our first house in 2003. We had a deposit of $12,000, and back in 2003 to buy a house was within reach. In Auckland, the average house price now is $1 million—$1 million for the average house—and the previous Government let it get to that point. They sat on their hands, they let the market take over, and the Reserve Bank even had to step in and act, because the Government wouldn’t.

Well, this Government will act. We will act in housing, and this is, like I said, a part of a suite of changes. Some of the members have been talking about “3 percent”. Well, I contest that, and the reason I contest that is because I’m constantly talking to real estate agents who are telling me it’s a lot higher than that. I’m constantly talking to people who are at auctions and losing—and losing—

💬 Hon Gerry Brownlee: Real Estate New Zealand—it’s their own figures.

Ha, ha! Look, people on the street know best, Mr Brownlee. If you think that you know best, then why didn’t you receive the votes of the majority of the people on the street? The people on the street know best, and we are listening to the people on the street. We’re listening to hard-working Kiwis who can’t afford to buy houses, and we will enable them to get into homes.

The goal for this policy is to ensure the housing market is shaped by New Zealand - based buyers. We will put Kiwis first. This will make homes more affordable for New Zealand buyers at some times in the property market cycle, including first-home buyers, while also supporting our efforts to build a more productive economy by helping redirect capital to productive assets. If we have a look at the German economy, they’ve had fairly flat house prices for around 30 years, because people invest in business—and primarily German businesses. We need a model similar to that, where people are incentivised to invest in business, rather than investing in housing.

The new legislation brings residential land within the category of sensitive land in the Overseas Investment Act. This change will not affect New Zealand citizens, regardless of where they live. They will continue to be able to buy houses without any screening from the Overseas Investment Office. Another key point here, as one of my colleagues mentioned before, is that if you live overseas and you do want to buy a New Zealand house, you can do that by building, so you’re adding to the stock, but you can’t buy an existing house. Just going back to what I said, from what I’m hearing, 99 percent of New Zealanders agree with this policy, and we will listen to Kiwis, helping them get into their homes. Thank you.

I call David Seymour—five minutes.

I’d just like to congratulate the member who has just resumed his seat, Jamie Strange, on getting all the way through his speech. Well done. And I just want to say to some of the National members who were ganging up and heckling him: how cruel. I suspect their behaviour, like many bullies’, was an attempt to hide an insecurity, and the insecurity is this: they know that the speech before it, by Andrew Bayly—Andrew Bayly, you see, is not known to be a funny man—proved, with his speech, that a man needn’t be funny to give a funny speech, and that he did. He started off by saying that there were deep philosophical divides between the National Party and the Government on this particular issue. He then went on to give a comprehensive list of policies that the previous Government introduced of the very same nature, with exactly the same objective.

Do we remember requiring foreigners to have a bank account, to have an IRD number? Do we remember the brightline test, which Andrew Bayly said was designed to ensure it was harder for foreigners to buy homes in New Zealand?

💬 Hon David Parker: And a good idea.

So the National Party know that this policy is ineffective, because it didn’t work for them either. But I don’t know if I can give the same forgiveness to the smiling David Parker, because he knows that this policy will not work, but he is learning about the exigencies of a coalition arrangement. David Parker is not a racist man, but some of the people he sits with are. The fact of the matter is that this policy is not going to be effective.

The reason it was found to be ineffective by the previous Government and will be found to be ineffective by this Government is very simple: you cannot tell the difference between the formal ownership and the beneficial ownership of a house in New Zealand if the owner wants to hide that beneficial ownership. Let me just give an example: someone under 30 whom I was talking to in Auckland the other day earns less than $50,000 and owns two houses in Auckland. Why? Extensive overseas contacts and sources of cash. Under this bill, that’s fine. Under any bill, that’s fine, unless you’re actually going to literally start blood testing the people that own the houses. That’s the reality. When the National Party says that only 3 percent of homes that were bought in New Zealand were bought by foreigners, we know that is absolute bulldust. The fact of the matter is that it might be formally true—it might be true on the property titles—but it’s not true when it comes to who has the beneficial ownership and who really owns the property.

So this bill will not do anything to change the real ownership of property—who really puts up the money to pay for it—but it will scratch an itch; an itch felt by some of David Parker’s coalition partner’s voters—that maybe those bad people who look different have been buying too many homes, and if we just stop that, then New Zealand will be a fairer place. He knows it won’t work—he’s said it won’t work—but he’s going to do it because of the exigencies of coalition Government. But the really sad thing for all of those New Zealanders who are finding it hard to access a home is that this Government is avoiding the real issue.

The real issue is this; it’s very, very simple. The real issue is that we built, in New Zealand, 39,000 houses in 1974, when people barely had technology such as nail guns, when the population was two-thirds of what it is today, and we haven’t broken 30,000 since. The rate of home building per capita in New Zealand has halved in the last 40 years under the Resource Management Act, under the infrastructure funding—and the member who just resumed his seat should study how they fund infrastructure in Germany. That’s the real reason it’s cheaper; it’s not this “ein Reich” stuff he was referring to. The fact of the matter is that if we don’t change our underlying land-use regulation and infrastructure funding regimes, we will not build more homes. We will not alleviate the very real shortage of housing. And we will not be a peaceful, harmonious, collegial nation here in the South Pacific when the Government of the day comes down to this House and puts on the Order Paper a bill that is designed not to make housing more affordable but to scratch that little itch. What a shame.

Thank you, Madam Assistant Speaker. It’s been an interesting afternoon at the beginning of the debate around this piece of legislation. I was rather intrigued when the list MP for Hamilton East, Jamie Strange, stood up and talked about 99 percent of people in the street of Wellington. It would probably be a good idea to actually go and speak to the people in Hamilton. But what intrigued me more—what intrigued me more—was when he got up and said that all of the real estate agents that he talked to actually are agreeing with the statement of the 99 percent of people in the Wellington street. Well, the real estate agents have just put out some information that is similar to the information that we found that identifies that it’s somewhere around 3 percent of people.

On this piece of legislation, when is a ban not a ban? It’s not a ban when the Labour - New Zealand First - Greens Government wants to implement the Overseas Investment Amendment Bill. This bill is not a ban, and we’ve already heard about the out clauses around people who want to buy into rest homes. There’s a whole range of things that have been put to us around this bill that show that it’s actually not a ban. We’ve also heard from our speakers that it’s about process, and about process that’s been badly, badly designed, because it’s been rushed through. We also heard from the Hon David Parker, when he got up and did his initial speech, that it is rushed legislation. All it’s designed to do is to put more red tape in from a red party.

This previous Government, in the National Party, introduced regular monitoring of foreign buyers throughout New Zealand, which showed that they were a very small percentage. Willow-Jean Prime, when she got up before, said we need to collect real data. Well, actually, we have started collecting real data. We’ve collected data that shows it’s 3 percent. So when Shane Jones stands up and says that it is the Government’s prerogative to make big, fundamental calls—yes, this might be a fundamental call, and we’ve heard a lot of rhetoric on the other side today about the fundamental call, but actually I wouldn’t call it a big call. If we’re talking about 3 percent, and then we take the 3 percent who actually are selling the houses off that 3 percent, it doesn’t come to a very large number at all. It’s a badly designed piece of legislation. It’s being rushed through around trying to get this piece of legislation completed before the Trans-Pacific Partnership (TPP), or the newly branded version of the TPP, comes through.

So there have been quite a lot of risks highlighted. The main risk that I see when I look at the regulatory impact statement and the stuff that’s been put forward is about the design choices. They may be suboptimal and they may have unintended consequences, which is really interesting in a bill where we’re talking about housing. If we talk about housing and we get bad design choices around housing that may be suboptimal or have unintended consequences, then we’re not going to end up with very good houses.

So if you apply this to a piece of legislation, it’s exactly the same—bad design choices, which may be suboptimal and have unintended consequences. I’m actually concerned about the people who work for our Overseas Investment Office because they’re only going to have limited time to operationalise the policy. We all know that when we have limited time to operationalise policy, things are going to fall through the cracks. So are people going to be flying blind? Is this policy going to be completely prepared? Is the operational part of this policy going to be completely prepared? Is the Government prepared for the things that are going to be falling through the cracks?

We heard also from Shane Jones before. He calls it a done deal. He says that this bill is going to go through, so he’s been telling those people that are interested in this topic that if they come along to the select committee their views are not of value. That is, I think, a bit arrogant. It’s one thing to be arrogant in terms of voting numbers in this House, but it’s another thing to give the public the view that if they come along to the select committee they won’t be heard.

I’m concerned at the limited time—and it’s been pointed out in these documents—to educate the real estate agents, all of the conveyancers, and all of the general public. Over 3 percent of people—so we’re talking about 3 percent of buyers minus 3 percent of sellers equals zero, and we’re going to this big fuss because we think it’s going to make a difference. This from a party over there who, during the course of the last three years, has voted against pieces of legislation to free up land to build houses, and then pretends that this piece of legislation is going to fix everything in the housing market, when of course it’s not.

So, to me, it’s just—other comments have come through today. The other side, the Government, says, “We fought an election on this issue.”, and “Floods of people from overseas—floods of people from overseas”. Well, right at the moment in this country we’re in the middle of a drought, and I would say that if we got 3 percent of our rainfall in the course of a year, we certainly would not call that a flood. So I’m not sure how you can actually apply—

💬 Hon Todd McClay: Unless it all comes at once.

Exactly. It’s a bit of a flawed theory. So I’m not sure how you can say that 3 percent of people buying houses in the housing market causes a flood.

💬 Hon Todd McClay: Especially if 3 percent of them are evaporating at the same time.

Absolutely. They’re disappearing at the same time, and we all know about evaporation because the heat outside is pretty hot, and the heat on the other side of this House is pretty hot.

I think the other thing that really concerns me, as a person who’s involved in the primary industry and knows that this country really, really depends on trade, is that we are rushing this through for the purposes of what the Minister says, about getting his newly branded TPP done. We know that there are exceptions for Australia. We’ve heard in the House this afternoon that there’s going to be some big conversations going on with a number of countries. Singapore is already having the discussion. How many of those free-trade agreements are going to actually cause this Government some grief going forward? That’s what happens when you rush legislation and you don’t think things through.

So, again, if we’re going to apply it to some trade agreements, and we’re not going to apply it to other trade agreements, or we can’t apply it to some other trade agreements, then it goes back to the original question that I posed when I first stood up. When is a ban not a ban? It’s turning into a great big confusing piece of legislation that’s designed to meet a little problem—a little problem that we’ve defined this afternoon, that potentially could be as small as zero. So just 3 percent minus 3 percent equals zero.

So I hope that when the select committee process takes place, there will be a time when people will have their concerns listened to, and that the public will have the opportunity to have a say on this, because this piece of legislation is about as clear as mud. It’s designed to clear up a problem that actually doesn’t really exist. It won’t be so long when people are talking about the cost of housing. They’re going to be coming back and going “Where are all these buyers anyway?” because the housing market is cooling off.

I’m also concerned really about how the Government—there’s no mention in here about how much extra funding the Government intends to give to the Overseas Investment Office. They’re talking about having limited time to put it together. So, first of all, there’s been no indication of how the Overseas Investment Office is going to be resourced. So you give people an extra job, you give them limited time to do it, and there’s no commitment to how much money that the Government is going to give them. In my time in Parliament there has been no shortage of criticism of the Overseas Investment Office from those members on the other side of the House.

So I would be concerned that this current Government is looking at setting up the Overseas Investment Office to fail on a project that is worth somewhere next to zero. So, thank you, Madam Assistant Speaker.

Thank you very much, Madam Assistant Speaker. I’m pleased to take a call on this, the Overseas Investment Amendment Bill, and I do commend it to the House. I think the purpose of this bill is quite clear, and there’s a very clear principle at stake here. We need to ensure that investments made by persons in New Zealand will have a genuine benefit to this country.

This bill is about addressing a very clear issue facing this country, and that of course is the shortage of houses available to those living here. It was once a realistic dream to own a home. It was once a realistic dream to buy a farm. That is no longer the case for far too many people. An important principle at work here is that New Zealand - based buyers should be able to help to shape the New Zealand housing market. The fact is that now it is not New Zealand - based buyers who are shaping this market. What is being introduced here, with this Overseas Investment Amendment Bill, is a new level of screening—screening within a structure that is already in place—to ensure that investment in this nation benefits this nation.

Residential land will be considered sensitive land for the purposes of the Overseas Investment Act—the Act that will be amended by this bill. Residential land is sensitive right now, in the common usage of the word “sensitive”. Many now consider owning their home to be a pipedream. We cannot sit back, as the previous Government has done over nine years, and let the dream of homeownership slip away for too many people. The fact is that we need to do something here, and this bill is going a long way to doing so. It is part of a wide range of packages. Nobody here is suggesting that it is the silver bullet and it will fix everything. But this Government is going to fix what is facing too many people in this country.

I’d note that the bill is not an outright ban on investment by overseas people. The change would not stop purchasers of residential land outright, because foreign investment in New Zealand, including in residential land, can bring genuine benefits to this country. Accordingly, overseas people will be allowed to purchase sensitive land that is residential land if they can demonstrate that it is of benefit to this country. This is a common-sense position to take, a focus that is of real benefit to this country.

Now, I take particular interest in this bill. I live in Masterton. Masterton was a town where you could always afford to buy a home. With the prices of houses in Masterton and the wider Wairarapa—indeed, the wider Wairarapa electorate, which encompasses the Tararua district and the Central Hawke’s Bay district as well—it was always a case where, regardless of what job you had, you had a realistic possibility of buying your own home. The towns of Wairarapa have been feeling the impact of the housing crisis for some time. The first part of that was because of the inaction of the previous Government, which led to the introduction of the loan-to-value ratio of 20 percent, which unfairly discriminated against those that lived in rural and regional New Zealand because they had to save up much higher deposits than were needed. That, at the time, was not an issue facing places like Wairarapa, yet people there were feeling the burn. I do not blame the Reserve Bank. That was a mechanism that they had to put in place because the Government simply would not act.

What was a huge problem for Auckland, Wellington, and some other larger urban centres is now also a problem for our smaller places like Dannevirke, like Waipukurau, and like Masterton. Now, some of these are good things. The fact that we have more people moving to our region is a good thing. There is no doubt about that, but it does create challenges. In Wairarapa we are very lucky. We are lucky. We are within an hour and a half’s drive from the capital city, so we benefit from the fact that we have a connection to a large urban centre and we have a regular commuter rail service. However, a lack of investment in that and other core infrastructure and a lack of support for local councils has meant that now Wairarapa is facing the strain of having an influx of people from the larger urban centres.

I congratulate the Masterton District Council for its promotional efforts in attracting those from Auckland. It identified that there was an issue there—that people in Auckland simply could not afford to buy a home, and that because we were close to Wellington, we had an advantage that other regions, such as, perhaps, Hawke’s Bay or Wanganui, may not be able to have, because they do not have that benefit, that connection, the regular connection to the capital city. But it is placing a strain. I feel for places like the Tararua district and the Central Hawke’s Bay district, which have a very low population spread across a very large area. Now, the Tararua district could benefit from its proximity to Palmerston North. The towns of Pahīatua, Woodville, and Dannevirke are starting to see people moving there because people can work in Palmerston North and travel. There is an impact there, however, because what they’re facing is an incapacity to invest in infrastructure for growth. This is a problem facing many rural areas. It is also an issue facing—

💬 Hon Steven Joyce: I raise a point of order, Madam Speaker. I just think we’re a mile away from the bill here at this point. It’s the Overseas Investment Amendment Bill. I think discussing infrastructure in Dannevirke is all very important, but maybe if we could ask the member to talk about the bill.

The ASSISTANT SPEAKER (Poto Williams): I think that’s very helpful. I’ll encourage the member to actually come back to the specifics of the bill.

Thank you very much, Madam Assistant Speaker. That’s not the first time the previous Government hasn’t wanted to hear about the issues in Dannevirke. The problem is that—

💬 Hon Steven Joyce: I raise a point of order, Madam Speaker. With the greatest respect to the member, that’s not a helpful intervention. He was invited to come back to the point of the bill. I’m more than happy to debate Dannevirke and other parts of this wonderful country as soon as the member puts up a bill about it, but this is not the case in this case.

The ASSISTANT SPEAKER (Poto Williams): I thank the member. I encourage the member to speak to the specifics of the bill.

Thank you, Madam Assistant Speaker, I appreciate that guidance. The Overseas Investment Amendment Bill—the fact is that we need to amend this for a very simple purpose, like I was about to come to, which is that those in the cities felt the strain of being unable to buy their home first. Now those in the regions are feeling that strain, and the regional councils and the local district councils are feeling the strain of the housing crisis because of the pressure that it is putting on them.

I mentioned earlier, of course, that it is not an issue just facing the cities. There is a very clear principle at stake in this bill. This bill recognises and reaffirms that is a birthright of New Zealanders to be able to afford a home and, indeed, to be able to afford productive land. If you have a right to live here, you should have a right to buy here, and this bill goes a long way to ensuring that’s the case. New Zealand and Australian citizens, and permanent residents who reside here, will be able to buy existing homes in New Zealand without going through the screening of the Overseas Investment Office.

It is my view that this is yet another example of this Government acting where the previous Government has not. The housing crisis has affected too many people. It was a key issue in the last election campaign, and it is a key issue that led to a change of Government. The objective of this Government bill is to ensure the principle that homes should never be commodities. We’re not talking about something that should be traded on the international market; we’re talking about something that people should be able to strive to buy and live in: homes—homes—which has been undermined by the previous Government, not just in terms of affordability but in many other issues as well.

This Government continues to welcome foreign investment as long as it brings benefits to New Zealand. Now, that’s a principle that’s been in place for a very long time through the Overseas Investment Office, and we’re talking about businesses and communities as well. Where it benefits New Zealand, it should be welcomed. We particularly want to encourage foreign investment where it adds to our economy. Investment in existing homes, however, by those who do not have the right to reside here and have no intention to live here does not help that objective. It also does not help the first-home buyers, the people out there that are now having to face the issue of saving up and finding themselves facing a much larger deposit than has ever been required before.

Another important note is that despite what we heard during the campaign, banning overseas buyers is indeed compatible with New Zealand’s free-trade agreements. The ban is compatible with almost all of our existing trade agreements. The past Government, I note, said that it was impossible to put this ban in place. I want to acknowledge the Associate Minister of Finance, the relevant Minister here, the Hon David Parker, who took this issue by the horns almost immediately upon election and has proven to the previous Government and to the people of New Zealand that they were wrong—that the previous Government was wrong, just to be clear. We have put in place something very quickly. I note the comments that have been made in that regard previously. We actually had no choice. This issue was neglected by the previous Government, and in order for this to be in place before the Trans-Pacific Partnership agreement comes into ratification, we had to put something in place. I commend this bill to the House and congratulate the Ministers and the officials for putting the work into it.

I raise a point of order, Madam Speaker. Can I just clarify the process here. In terms of the motion in respect of the length of the select—does that come next rather than as part of this motion?

Yes, yes, we’re just moving this—so I will put the motion again.

I move that the Overseas Investment Amendment Bill be reported to the House by 20 February 2018 and that the committee have authority to meet at any time while the House is sitting, except during oral questions, during any evening on a day on which there has been a sitting of the House, and on a Friday in a week in which there has been a sitting of the House, despite Standing Orders 191 and 194(1)(b) and (c).

The ASSISTANT SPEAKER (Poto Williams): I apologise to the member; I just have to take some advice on this. Can I just ask the member to read the amendment as required. He hasn’t read the amendment as required.

I move, That the bill be reported to the House by 20 February 2018 and that the committee have authority to meet at any time while the House is sitting excepting during oral questions, during every evening on a day where there is a sitting of the House, and on a Friday in a week in which there has been a sitting in the House, and outside the Wellington area, despite Standing Orders 191, 193, 194(1)(b) and (c).

I want to explain to the House why we’re seeking this earlier report back. In doing so, I want to acknowledge that the principles of good parliamentary process generally require that there is a decent period of select committee consideration—a period that is long enough for about six weeks of public notification before submissions close. The reason for that is that you want people to be able to take advice. If they are organisations that have got a monthly meeting schedule, they can get board approval or committee approval before they make their submission. Then you give plenty of time for the committee to consider submissions, to hear departmental advice, and to make considered recommendations back to this House. Through that process, we have as close to perfect legislation as you can get. That is the normal process, and that is the process that this House should normally adopt.

There are exceptions to those normal processes. The most shortened of those is where the House takes urgency with no select committee process, and there are occasions when that is necessary. Indeed, it was actually thought, until about a month ago, that we were going to have to pass this through all stages because there was the prospect that the Comprehensive and Progressive Trans-Pacific Partnership agreement (CPTPPA) would be signed by the parties by about now. Once that agreement is signed, it is beyond the control of the New Zealand Government when it comes into effect, because the provisions of that agreement now say—and this is one of many differences between this agreement and the old agreement—that a simple majority of the countries that have signed up to it have to ratify it before it comes into effect. So if there are 11 countries that sign up to it, it takes only six of those countries to have ratified it for it to come into effect, and that is beyond the control of this Parliament.

We know, from advice that we’ve had from officials and statements that the Government has made publicly, that the changes that are proposed to New Zealand’s investment screening regime have to be in place before the Trans-Pacific Partnership (TPP) comes into effect in order for there to be the policy space for this Government, or any future Government, to have the effective ability to change screening rules.

💬 Hon Michael Woodhouse: Rubbish!

“Rubbish”, the former Minister says from the other side. He still does not get it. He does not get it after all of this time—that what the prior Government was doing was signing away for ever the effective right for New Zealanders to change—

💬 Hon Gerry Brownlee: You can’t talk about that. Narrow it up. Broaden it out if you like; we’re happy to.

Well, I’m actually not attempting to broaden it, but I am making the point that this is why—I’m very happy for it to be broadened, because this is the debate that we are happy to have, to show that this is an appropriate shortening of the period of consideration, because, otherwise, New Zealand loses the ability to change these screening regimes, in effect, not just because of TPP but because of most favoured nation clauses that are common to various other trade agreements, which take into the earlier trade agreements the provision of TPP. So CPTPP is dragged into the earlier agreements. If we do not—

The ASSISTANT SPEAKER (Adrian Rurawhe): Sorry to interrupt the member but the member cannot broaden the debate, and it’s a very narrow debate. I’m sorry for not pointing that out earlier, but the member cannot do that.

💬 Hon Gerry Brownlee: I raise a point of order, Mr Speaker. Could the Speaker perhaps indicate to us the parameters of the debate?

The ASSISTANT SPEAKER (Adrian Rurawhe): OK. I refer to Standing Order 290(3): “Any debate on the question for a motion under this Standing Order is restricted to the special powers or instruction set out in the motion. It may not extend to the principles, objects, or provisions of the bill to which the motion relates.”

💬 Hon Steven Joyce: I raise a point of order, Mr Speaker. I don’t often want to rise in support of Mr Parker, but it’s actually quite an important procedural issue that he is addressing, which is the timing of the particular agreement, which is his primary reason for bringing the bill back to the House early. Now, I think that’s something that does meet the test of being included in this debate. Members on this side will want to be able to address that in the debate, because if that’s the reason for taking the step that the Government is proposing to take, well then it will be difficult to have the debate without actually addressing whether the reason is valid or not.

Speaking to the point of order—

The ASSISTANT SPEAKER (Adrian Rurawhe): No, I just want to answer this one. In terms of making changes, extending dates, etc., the member can raise that in their speech. The expectation is that a copy of that will come to the Clerk after the member has spoken. I’ll listen carefully and invite the member to continue, and please keep the debate on the timing of the bill.

I raise a point of order, Mr Speaker. I’m going to agree with the Opposition on this occasion. With respect, I think the purpose of this debate is to justify a shortened process. There are reasons that we normally have a more lengthy process. I’ve been involved in a number of these debates over the years in Opposition, and we have routinely sought to either criticise or justify the length of period in relation to the circumstance that justifies the change. I think that the Hon Steven Joyce is correct in that regard.

The ASSISTANT SPEAKER (Adrian Rurawhe): OK.

I won’t unduly prolong it, sir. I will also make it clear that the exact date on which the TPP agreement is signed is not yet clear. It is, at this stage, expected to be in March next year. If it is March next year—

💬 Hon Gerry Brownlee: Point of order?

This is not a point of order; I thought I was speaking in the debate again.

The ASSISTANT SPEAKER (Adrian Rurawhe): I thought you were adding to your point of order.

No—sorry, sir.

The ASSISTANT SPEAKER (Adrian Rurawhe): All I’m going to say is that I’ll listen carefully to what members are saying, and then if there are issues that arise, members need to make sure that it is relevant to the motion.

💬 Hon Todd McClay: I raise a point of order, Mr Speaker. It may be a point of clarification, because the Hon David Parker has been speaking as to the reason he’s speaking outside of the bill itself. I’m now unclear, based upon your ruling, whether or not the Opposition is able to speak to that. I actually agree with the Hon David Parker—today is the first time he’s said something, actually, that is correct. But I do want to challenge some of the things in his speech so far, because I don’t agree with them, nor do I think that they are reasons for us to be rushing back so soon afterwards. So if you could just clarify your ruling—it feels to me that what you’ve said is that you’re going to take it on a case by case basis. It would be remiss of me not to raise this in case, on a case by case basis, you don’t allow us to respond to the reasons David Parker has given that we are going to make people work so hard through the Christmas break.

The ASSISTANT SPEAKER (Adrian Rurawhe): I apologise to the members of the House. I haven’t actually made a ruling; I’m just making a point of clarification. The timing of the TPP is relevant to the timing in so far as it’s relevant to the timing of the bill—then, yes, you can speak to it.

Thank you, Mr Assistant Speaker. At this stage, it may be signed in February or March. This is a matter that is, again, beyond the control of the Government, because it depends a bit on when other countries are ready to sign. We’re ready to sign now. If it turns out to be March, then it may be that towards the end of this February period we can extend the time of the select committee through the Business Committee if the interests of New Zealand are not undermined in terms of the legislation being passed before TPP comes into effect. It is also possible that because of this TPP deadline that there is a Supplementary Order Paper that may also—

💬 Hon Gerry Brownlee: What deadline? You just said there’s no deadline.

I said the deadline is when it comes into effect, Mr Brownlee. I think I’ve explained this.

If that is necessary, we will endeavour to make the Supplementary Order Paper available to the select committee as soon as we are able, but, again, that is subject to this deadline that arises from TPP coming into effect.

Does anyone else see the irony in the current Government saying that they have to rush this through because they don’t want to get caught out in the Trans-Pacific Partnership, or the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP)—whatever it is now—but also criticising the previous Government for saying that the provisions that they are seeking to work around here—they’ve not changed, I might point out—could not be achieved.

I think we’ve got to get back to the point here: that the select committee is going to be asked to do a lot of work in a very short period of time. I would refer the House to Speaker’s ruling 102/7. This is a ruling that came out of the Review of Standing Orders: Report of the Standing Orders Committee, September 2011, so it’s quite current. At that time, indeed, the Minister now moving this particular shortened, or truncated, select committee process would have been active on that committee. It says: “Select committees should have six months or more to consider most bills. There is no intention for the default period for select committee consideration of bills to be shortened, and the Government should exercise due restraint when considering the truncation of the select committee process.” So just think about that “due restraint”. Is that being exercised in this case?

A couple of weeks ago, when Mr Parker went to Argentina to participate in the discussions in Buenos Aires, there was an expectation, or a hope, that the CPTPP might get signed up a little bit sooner than it appears to be now. But that meeting did not meet all of the hopes and aspirations of others, and it would seem that we are in for a long and protracted process before the 11 come to agreement on this comprehensive partnership.

That’s what I think causes us to think about whether or not it’s appropriate that we take out, firstly, even just the legal holiday—I should say for the legal fraternity—that occurs in New Zealand over the next short while. We know that, from about Thursday of this week through to around 20 January, a lot of those professionals are not available to advise people who might want to make a submission on this bill. And then, to expect that within a short four-week period, the requirements that are set out for a select committee in the Standing Orders in this Parliament can be met—I think it’s worth reflecting that each select committee to which a bill is referred examines the bill and determines whether to recommend that the bill be passed.

Now, this afternoon in the House, we have heard Government members saying, “It doesn’t matter. We’ve got the numbers. It’s happening.” Well, we’ve also heard the Minister say that the Government did consider putting this through under urgency but now the need for that urgency has dissipated. I would think that defaults us to a position where we go back to the Standing Orders and do things in an appropriate fashion.

It also, of course, says that a report of the select committee on a bill indicates the committee’s determination on all matters set out in the Standing Orders. So, if you go then to Standing Order 293, it goes to the issue of opinions from other select committees. This is not a bill that stands on its own and has no effect on other activities inside New Zealand. Firstly, it might be inappropriate in this debate to state that it is certainly a sledgehammer attempting to crack a nut—and all of the stats show that, since the changes that were made about 12 months ago by the previous Government—but let’s just consider for a minute the education workforce.

We have, at the moment, our Government agencies out around the world, particularly in English-speaking countries, trying to recruit teachers to come to New Zealand. They will come to New Zealand on various types of visa, and while the bill says that if the visa is appropriate, then they might be able to buy a house here, there is no discussion in the bill as it currently stands about the parameters of those visas. So I think it would be quite appropriate for the select committee to consider that and to ask the opinion of the Education and Workforce Committee about what they think might work, not only just for education but—take that word “workforce”—the entire workforce of New Zealand, particularly in the higher skilled areas where we are benefiting from people who choose to make a life here.

Now, the Opposition will immediately say, “But, oh, we’ve covered that off in the bill, so the committee doesn’t need to take it any further.” I think that is wrong. I think that is the sort of arrogance that often leads to mistakes.

Then, I think, if this is going to be a bill that changes the parameters for foreigners being able to buy land here and allows, for example, the investment in rest homes or in retirement villages or in any other number of social service facilities that might be required around the country, then surely the Social Services and Community Committee should have a view on that. I find it amazing that we can be considering a bill, which the House will deal with shortly—brought into this House by the Hon Ruth Dyson—dealing with some of the concerns around the way those villages operate, but it is also a bill that then enables foreigners to come and, pretty much without any restraint, invest in those particular facilities.

Why wouldn’t we have the Economic Development, Science and Innovation Committee look into this? We know that foreign investment is welcomed in this country—Mr Parker has said it over and over. I think there should be a consideration of what restraint this bill might put on that—not unreasonable.

💬 Hon David Parker: I raise a point of order, Mr Speaker. The motion as to which committee this goes to has already been considered and voted upon. This debate is about the term of the referral.

Speaking to the point of order, I refer the Assistant Speaker to Standing Order 293, which says that “The select committee to which a bill is referred may ask any other [select] committee for its opinion on the bill or … part, [or] clause, [or] schedule, or other provision of the bill.” I’m making a case, in my speech this afternoon, that they should be able to do exactly that.

The ASSISTANT SPEAKER (Adrian Rurawhe): Yes, and I agree with the member. That’s absolutely correct.

Thank you, sir. So then there is the question about whether the Foreign Affairs, Defence and Trade Committee should be asked for its opinion on this. I think that that is very much an absolute. We have significant arrangements in this country in defence ties with Singapore, as we do with Australia. Singapore, as we know, are rightly aggrieved that they are apparently not, in this bill, to be treated as the Australians are. Yet they are very, very close to us in so many ways, and further, they’re looking, of course, to invest in the central North Island, and that, of course, regardless of what Mr Peters said to the House last week, will involve some kind of property investment. There is no provision for that sort of activity in this particular bill, and I think a simple reference to the Foreign Affairs, Defence and Trade Committee would be a good idea.

The Speakers’ rulings, of course, are a very good guide to the House, and I just want to talk to one that is relatively recent. Speaker’s ruling 105/1 says that “[There are] implications for the quality of legislation of allowing insufficient time for the drafting of amendments and commentaries. We urge select committees examining bills to programme sufficient time for the drafting and consideration of amendments, and for the subsequent drafting and consideration of commentaries.” Now, that seems to me a reasonable direction from the Speaker from 2011, but where does a select committee go if a Minister manages to persuade the House—and only by using the whip to get the full range of votes—that the select committee process should be truncated?

The Hon David Parker, this afternoon, also said, “Well, if it looks like the TP—CPTPA is going to be extended a little bit further before we get a signatory”—

💬 Hon David Parker: T-P-P-A.

Look, I don’t know how many Ps are in it, and I’m not sure how many Ts are in it. It is a wonderful trade deal, which I do hope is signed off as soon as possible, but it’s not on the horizon at the moment. The Hon David Parker said, “Well, we could go to the Business Committee and ask for an extension of time.” Why not do it the other way round? Let the select committee go to a reasonable period of time, and then ask the Business Committee either to truncate it, or—knowing that all the members on the committee will want, in majority, for that deal to be signed—for them to do the work a little bit more quickly, on a more collegial and voluntary basis?

So I want to move an amendment to the Hon David Parker’s motion. I accept all of the aspects of his motion that talk about the time, etc., by which committees can sit, but I move, That “20 February” be replaced by “19 April 2018”.

That way, there will be plenty of time for a good bill to come out of this. It’s pretty untidy at the moment.

Thank you very much, Mr Assistant Speaker. I rise to take a call on this because I actually am quite concerned about the amount of time that has been allocated for this bill at committee, according to the motion from the Government. If you start with Mr Parker’s own speech when he was reading the first speech on the bill in the first reading, he talked about how this bill had to be rushed and put together quickly, and, for that reason alone, I think it is worth having significant time at the committee.

I appreciate Mr Parker’s concerns about the “alphabet-soup” TPP that we’re now in, but it’s sort of a little ironic given that he’s spent much of the last couple of years talking about New Zealand sovereignty and how important it is for New Zealand to do the things that are important for it, and suddenly we get a piece of legislation that does change things for New Zealanders in quite a comprehensive way. It needs to be assessed properly, and we are having to kowtow to the international agenda, such as it is, rather than actually taking the time to investigate this bill properly ourselves as a country and as a Parliament. So I would have thought, for sovereignty reasons alone, we should start by having a decent look at this particular bill.

Of course, we have no way of knowing, at this point, whether the alphabet-soup TPP will actually be signed, and, in fact, the signs are not particularly portentous given what didn’t happen in Argentina last week. Not only did the Ministers of the TPP—I’ll use the shortened version, if I may—not meet to actually decide whether they could sign up, they didn’t even meet to discuss whether they could sign up to the agreement. They were all there, apparently. It’s obviously busy at this time of year in Buenos Aires—you know, there’s lots to do. It’s a pretty city, I’m told; I haven’t been there myself. But, for all of that, they had no time to sit down and say, “Well, where are we up to? Let’s take stock on this. Let’s see where the Canadians are, let’s see where the Vietnamese are, let’s get this thing cranking.” No, there was no time for such matters and—[Interruption] They didn’t what?

💬 Hon Todd McClay: Canada probably didn’t turn up to the meeting.

Well, they wouldn’t have turned up to the meeting. But that’s possibly why one was never scheduled, and there would’ve been the risk of Canada not turning up to the meeting. So the urgency, from that perspective, is not apparent. So I come back to the importance of getting this bill right, as the pre-eminent responsibility of this Parliament, and there are lots of red flags—or, at least, amber flags—that this bill is not right.

First, we had the Minister in charge of the bill saying it was rushed and had to be put together quickly. I note that when this so-called solution was announced, there was no paperwork at all. It was on 31 October—less than two months ago. There was no paperwork at all that was released. It was, literally, an announcement at a post-Cabinet press conference with very little detail at all, and now we have a bill that, it has to be said, has a number of red flags on it from Treasury, which is in charge of putting together the regulatory impact statement on the bill.

That’s important, because the whole idea of these regulatory impact statements is that Parliament and, indeed, the public get the officials’ view—not the Government’s view; the officials’ view—of how things are coming together and the sort of work that’s been done to bring the solution, in the form of the bill, towards the House. Again, the flags here are quite large and waving. The first flag is right on the front page, and it says that this particular version of the regulatory impact statement “was prepared for consideration by Cabinet on 11 December … further policy changes were made subsequent to this meeting.” So we’re not even a week past, and there were still further policy changes being made up till just a couple of days ago, obviously. So we have a bill that is, literally, being rushed into the House before it lifts for Christmas.

It notes, in this cover note, that “The Treasury has not had an opportunity to assess the impacts of these changes.” So the agency in charge of the regulatory impact statement hasn’t had the opportunity to consider the bill before it comes to the House for the first reading. That seems very strange, indeed. Then you get into some of the design choices that they worry about. I’m not going to discuss the contents of the bill, Mr Assistant Speaker, but just simply some of the points Treasury makes as it raises its various flags. It says, “some of the design choices may be sub-optimal or have unintended consequences;”. It doesn’t get much more black and white than that. Then it says, “the Overseas Investment Office will [in turn] have limited time to operationalize the policy; and limited time to educate real estate agents, conveyancers and the general public.”

So we have there three separate flags, and I, as a member of the select committee, would like to have the opportunity to explore fully what design choices could have been done instead that might be better. I would like to hear from the Overseas Investment Office as to how they might operationalise this policy. I would like to hear from some real estate agencies, some conveyancers, and from the general public as to how they might respond to this particular piece of legislation. The problem with that is that if you look at the potential time for the select committee to examine this bill, it is very limited, indeed. If the Parliament agrees with this 20 February—or whatever the date is; 20 February?—

💬 Hon Members: Yes.

—20 February report back, then, realistically, the committee has to be considering the submissions by the time of late January, which means that submissions have to be called for tomorrow, if this bill gets—it has been passed through. The committee will have to call for submissions tomorrow, and the submissions will have to be received by early in January.

This is an important piece of legislation. The Government says that this is a piece of legislation that is important. There will be others who think it’s more like virtue signalling, but the Government says it’s an important piece of legislation, so you would think it would warrant asking the public at a reasonable time of year and, acknowledging the time of year, that the public would have, perhaps, a little more time to make their submissions. I’m not just talking about the public; I’m talking about the real estate agencies and the conveyancers, and, indeed, the lawyers. I don’t have the same concerns about the lawyers as my colleagues do, because I’m sure they’ll be able to charge extra hourly rates to be on deck.

💬 Hon Gerry Brownlee: No. The lazy buggers; they’re always out at their relations.

They’ll all be out already, you think? They won’t even get the memo. But these things are important, and it is important for the public. I know it’s often talked about—a decline in homeownership—but, actually, when you add the number of people that own their own homes, and trusts that own homes, it’s nearly 70 percent of the population. We can debate whether that’s enough or not, but that’s a lot of people who are impacted, potentially, by this bill once they look to sell the property. I would like, as a committee member, to actually explore a little bit more in detail why it is that we are bringing this bill to the committee in the first place. Some of the rationale for the bill needs to be properly examined by the committee, because, unfortunately, again, Treasury says the only reason that it’s here, pretty much, is because it seeks to implement the Government’s 100-day commitment.

In the section of the regulatory impact statement where it says, “What problem or opportunity does this proposal seek to address? Why is Government intervention required?”, effectively, it says that Government intervention is required because the Government wants to intervene. Actually, the committee could perhaps do the Government’s job a little bit, given a little bit of time, and assess what is the need for this particular piece of legislation, because there is none in the documentation that’s been provided to the committee. I know that across this House there are different views as to the need for this particular piece of legislation or not. That’s something the committee should address, and have the time to address, if this Parliament takes itself seriously. I think that it’s important that this Parliament does.

So I would call upon the Minister who is leading this bill, David Parker, to think very carefully, because there is, as Mr Brownlee says, alternatives to setting such a short date. There are alternatives for doing that, and those alternatives include setting a longer date and then using the Business Committee to bring it back should there be some urgency. I have to say I’d love that urgency to appear, Mr Parker, but you and I both know—and I’m not bringing the Speaker into this; Mr Parker and I both know—the likelihood of that urgency occurring is, sadly, not great if the Ministers involved can’t even meet in Argentina to even discuss the trade deal that creates such urgency. Thank you, Mr Assistant Speaker.

There are times when a shortened report back is not only necessary but appropriate. From time to time, also, this House will need to take urgency. I don’t think last week’s bill is a very good example of urgency, but after this bill, we will be considering the Christ Church Cathedral Reinstatement Bill and that, I think, was a good example of where an appropriately consulted, bipartisan approach was taken to a very speedy report-back date and the members—the Hon Maggie Barry, Hon Nicky Wagner, Matt Doocey—were all part of the process—

💬 Hon Gerry Brownlee: We had a Minister who knew what she was doing.

Well, there you go. I mean, I suppose, unlike the Minister in charge of this bill, David Parker, she probably did talk to the people that were, on this side, very invested in that. So there’s no doubt that there are times when it is appropriate. Not only is this not one of those times; this is probably the worst use of a shortened report-back period since this process began. I can’t think of a less worthy bill for a shortened report back, and I’ll explain why. Today is 19 December, and up and down the country there are firms and businesses and companies and construction organisations winding up and probably winding down. I have no doubt that Mr Parker’s former law firm is doing just that, particularly in the Queenstown office, where this bill is going to be so important to them.

Now, far be it from me as an accountant to defend the lawyers amongst us—and I’ll probably send them an invoice for the two six-minute stanzas, or part thereof, that I will speak in their defence—but I actually think it is appropriate that hard-working professionals, be they lawyers or be they conveyancers, real estate agents, chartered accountants, immigration advisers, and the lobby groups that represent them: organisations like the law societies, Chartered Accountants Australia and New Zealand, the New Zealand Association for Migration and Investment, the Registered Master Builders Federation of New Zealand, the Property Investors Federation. Who knows how many people, how many organisations and individuals, would be particularly interested in making a submission on this bill, who are currently packing the factor 50, the cossies, the water boards, and the jet skis, and they’re thinking about where they should be going—paradise, of course: Cromwell, Queenstown, Wanaka, Lake Hayes, or maybe the Coromandel. Mr Parker drops on them a bill that is so important, so badly written—and I’ll get to that in a minute—on 19 December and says, “We’re gonna have a comprehensive report back by 20 February.”

So I’m doing a little bit of the math. The minimum time—the minimum time—for submissions to close, I think, would be Friday, 12 January. Now, that would be the absolute minimum. It’s about 2½ weeks away. It is an unacceptably short time frame to be able to give this bill due consideration and make thoughtful submissions at the very best of times, but those organisations are ready to shut up shop and do what I expect David Parker wants to do, and that’s go and have a break. Now, I don’t begrudge Mr Parker’s break. He’s obviously worked very hard. He probably deserves it, but so too do the people who should be submitting on this bill and telling the Government exactly what they think of it.

I’d describe that time frame in the context of the very best legislation that could be written. Bear in mind that the select committee also has a responsibility in this as well. I’d draw the House’s attention to Speaker’s ruling 104/2, from the report of the Standing Orders Committee of 2014 about legislative quality. It talks about “Parliament [being] the supreme law-making body in New Zealand, but … operates within a larger constitutional framework. Our democracy requires respect for the rule of law and avoiding the arbitrary deprivation of rights and freedoms.”—I would suggest including the right to make a thoughtful submission on bills—“Care should be taken to ensure that [the] proposed legislation passed by the House is appropriate … We encourage select committees to examine legislative quality issues, with a particular focus on matters of constitutional and administrative law, when preparing their reports on [those] bills.”

Well, there is simply no opportunity whatsoever to do that with this bill, and that would be if it was a good bill. Now, normally, when it’s a bad bill, the regulatory impact statement (RIS) has particular code in it where the officials are really telling the House that they don’t much like it but they don’t like to do that to offend the Minister. Well, to be honest, Treasury didn’t bother this time round. They said it like it is. They said, on page 5, “This has meant that there has not been any opportunity”—no opportunity—“to consult with private sector organizations or the general public to inform the development of this policy.” No consultation. No exposure draft. No “What do you think about this?” They just landed the bill on the House and said, “Guess what? Your Christmas is cancelled.” Their Christmas is cancelled—zero opportunity to consult with the private sector. As such, in the range of options measured, the RIS always looks to what else we could do to give effect to the policy intent. Remember, the Minister thinks it’s a ban; we know it’s not a ban, but, as such, because “[The] analysis has been constrained by the Government’s commitment to implement[ing] this specific policy.”—nothing else—“… no other housing policy measures (for example policies that would support the broader objective of increasing the supply of residential property) … have been analysed or evaluated.”

So not only do we have a bad bill at a bad time of the year for the people who are most affected by this; the Minister says, “Holiday’s off.” And I think the Hon Gerry Brownlee is absolutely right when he says, “Let’s amend this. Let’s have a shortened report-back date, but let’s be sensible about the time of the year and the opportunity for those organisations to make thoughtful considerations.” I don’t agree that the scurrilous attitude that was portrayed by the Hon Shane Jones in his first reading speech is actually reflective, certainly of the Minister responsible for this bill, who basically admitted, “Get over it—that’s politics.” He said, “We’ve got the numbers. If the public don’t like it, they get a chance to do something about it in 2020.” Word for word, that’s what he said. Well, I would remind that member that the first poll after the election saw a 30 percent plummet in New Zealand First’s support, and most of it went to the National Party.

The ASSISTANT SPEAKER (Adrian Rurawhe): The member needs to come back to the motion.

The point I’m making, Mr Assistant Speaker, is that Mr Jones and his Cabinet colleagues treat the public with that level of disrespect at their peril.

This is a terrible process. It’s a terrible bill, but that is the Government’s right. They have every right to introduce bad legislation, but so too do the public have a right to say what they think about that. In order to be able to do that, they need time to understand it, to gather their thoughts about it, to make thoughtful submissions on it, and then to appear before the select committee in support of that submission. It wouldn’t be quite so bad if the imperative to get the legislation passed was as the Minister said. But, as the former Minister of Trade had said, the CPTPP—

💬 Hon Todd McClay: Just call it “TPP”; it’s the same.

TPP—it is easier. The alphabet soup has been signed, will be ratified, but won’t come into force for anything up to two years. A two-year window we have to get this right, and the Minister is saying that’s not enough: we’ve got to get it in, we’ve got to get it in the House six days before Christmas. We get submissions—who knows when—12 days into the new year, and we rush, as Mr Jones has admitted, a superficial—just give the appearance of consultation and listening, and then get the bill through. Well, this is not the way good law is made. Frankly, where the Green Party is on this I have absolutely no idea. I would very much like someone in the Green Party to take a call and say how those righteous, indignant speeches that we got on any shortened report back have suddenly gone quiet, quiet as mice, on the one thing that I thought they would challenge, which was an openness to people from overseas, because they do that with refugees. They do that with other migrants, but apparently “Johnny Foreigner”, when he wants to buy a bungalow in Parnell—

The member’s time has expired.

I move, That the question be now put.

I won’t accept the closure motion at this time, thank you. This is a narrow—

💬 Hon Gerry Brownlee: There’s no such procedure in this. It’s not a committee.

The ASSISTANT SPEAKER (Adrian Rurawhe): There is. I understand it to be that in fact a closure motion can be moved. It’s also correct that if the Minister wants to respond to the amendment that has been made, he can do that as well. I am going to take the next speaker. But this is a narrow debate, as we have said. There is no scope for talking about other political parties and their poll results.

Mr Assistant Speaker, thank you very much. It is concerning to come before the House, so soon before every member goes off for a holiday, to, effectively, rush through a piece of legislation that’s been rushed in its drafting, for reasons that we now hear, from the Minister responsible, the Associate Minister of Finance, are actually no longer valid. That’s, of course, because when the Government first announced that they were bringing this legislation before Parliament within the first 100 days, they said they needed to do so because of the Trans-Pacific Partnership agreement (TPPA). Since then, some very minor changes were made—with the exception of quite a significant change to the name of that agreement, but for simplicity let’s just call it the TPP agreement. We’ve just heard from the Minister responsible, who’s introduced this bill, that actually, he believes it’s important, I suppose, based upon the advice that he’s had but not shared with the House in the debate earlier, nor with the public, nor with members of the committee, nor with anybody that would want to submit on this bill. He hasn’t shared the advice as to why there is such a rush to get it through.

We’ve now heard from him that, actually, it’s only before the TPP agreement enters into force that it is an issue for the Government and for the legislation. I would love to hear from him in response to why he will or will not support the amendment proposed by the Hon Gerry Brownlee, about why he believes we need to rush when there is no date for the signing of the TPP agreement, there is no date for Ministers to come back together to work through the issues of that agreement, and there is no real clear indication that the day afterwards, actually, six of the remaining 11 TPP countries will ratify it and it will enter into force. The original agreement, when signed in New Zealand almost two years ago, was ratified by only two countries, one before the US pulled out, one just after the US pulled out. After two years, there were only two countries that had ratified, and the deadline in the original agreement was that it had to enter into force within two years.

Now, if there was a proposed provision in the amended TPP agreement, which, largely, is the same as the one signed in Auckland, then I suppose the case could be made. We at least would be able to say to the public, to all those who want to submit but may well not be able to because of the very tight time frame and the holiday festive period—for members of the public more than members of this House—if there was a date that they had proposed or they had released when they last met a month and a half ago, then we would perhaps be able to consider this and take it more seriously. But there isn’t. There isn’t a time line for signature. There isn’t a suggestion that there will be a drop-dead date. In fact, the Minister has said six out of 11 countries need to ratify it.

I predict two things. The first is that I don’t think the TPP is going to be signed, because I think Canada has decided they don’t want to do it. So we’re rushing for something that won’t happen. But this is important because the sole reason that the Minister responsible has given is that we need to rush because of some legislation. So the likelihood of it happening or not is important when it comes to the House deciding whether or not we should vote to allow an extremely short period of time for consideration. That’s the first thing. The second thing is that even if it was signed, it could be a year or more. So what the Minister is doing is coming to this House and asking us to cut short the democratic right of members of the public to submit—large and small, up and down the country—the right to put in a one-word submission to the committee or a well-thought-out, detailed submission to the committee and ask to come before it.

What I want to speak to is: how many days, actually, if it is 20 February, is it reasonable for us to consider can be worked through? Well, if the committee this evening or tomorrow calls for submissions—if this evening or tomorrow they call for submissions—there are just five working days left in December. Whilst the Minister responsible could well be sunning his speedo-clad frame on a Pacific Island beach, Kiwis are expected to work between Christmas and the New Year. Now, let’s say that 20 January is the date when submissions will close, allowing just one very short month for the committee to hear from all of those submitters. I expect there will be a lot because there’s not that much detail here. But 20 January would mean that there are just 13 working days in January for people to submit, whilst the Minister, Mr Parker, could well be convalescing on the alpine slopes of Switzerland whilst he’s at Davos, talking up the importance of trade and open trade liberalisation. That would leave a very short period of time for the committee to consider this detail in total.

If we accept Mr Brownlee’s proposal, by putting it out to 20 April—

💬 Hon Members: 19th.

—19 April—from the point that’s currently proposed to when Mr Brownlee is proposing would actually be more working days available to the public and the committee. So 41 days until submissions close and the committee has to report back is a very, very short period of time.

And, indeed, this is an important piece of legislation. Other members have spoken about those that will play a professional role in providing submissions to the committee, and many of them will be hearing for the very first time not that this bill has been coming to the House—that was well signalled—but that there is a truncated process. And when they wonder why they’re actually either going to miss the deadline or going to have to decide to cut short their breaks with their families, come back to work, and try to get the information that they need to pull those meetings of stakeholders together to put together a well-thought-out submission to the committee and ask to be heard on it—the challenge that they will have is they won’t have been given a solid reason for it, other than the Minister deciding he wants to put it through.

So the real questions for this House in debating or deciding whether or not to support this motion on behalf of the Minister are: is there good reason for this to happen; is it reasonable; and is there urgency? Is it reasonable for us to say to the public that, actually, with something so significant to them—when the officials themselves in Treasury have said they really don’t know what’s going on and we’ll have to take some more time—when they come before the committee, they too are going to feel that the time frame put upon them to give the advice that they need, that the committee will demand, is also cut short. And all that members of the public will hear is that the Minister is pushing it through and maybe, if, in the end, the reason he’s here—TPP—is not going to be signed, he could ask the Business Committee for some more time. Well, that’s not going to work for the public, who now have been told, you know, this is of such urgency that they must rush it through in the way that is being proposed.

We have seen on many occasions, if one reads Hansard—and Government members, when they’re in Opposition, would say it time and again, and whilst I wouldn’t always agree with them, in this case absolutely I would—rushed legislation is not good legislation. It means you always have to come back and fix unintended consequences. Now, I don’t want to go into those unintended consequences here; that is something that the committee would do, but it’s only possible for the committee to do it when the officials can give them correct advice, No. 1, and, No. 2, when they get to submit questions to the committee, often after receiving submissions and considering them, and I think there will be thousands of submissions on both sides of this debate to the committee. After they’ve heard from submitters, they get to raise these points. So I’m not sure that the committee will be able to do its job as well as this House needs it to as a result of the short time frame, and the Minister honestly has not given a genuine reason why there is such a rush.

At least, the reasons he’s given he’s now said actually probably are not the case. If he was to go back to the Business Committee early next year and ask for more time, it would be too late for the submitters who have already worked hard and put in their submissions. I really ask: if there is no date for the TPP to be signed—there is absolutely no clarity at all about when, if ever, it could enter into force—what is the rush now, just before Christmas?

The final point I want to make here is that, actually, probably, what’s very important for members, before they vote on this motion and, more importantly, vote on the amendment that Gerry Brownlee has made, is what could well be going on really. If there is no rationale because of that deadline for TPP, what’s really going on? Well, I’ve been hearing there has been a not straightforward process when it comes to the Government getting the legislation together. I would hazard a guess there’s a lot of disagreement around that Cabinet table. The committees would be all over the place. I would imagine not a single Government department has said it’s a great idea, and if that is the case, then, actually, more time is needed, not less time is needed, to make sure that any unintended consequence is moved out of the way. This shouldn’t be rammed through just because of dodgy coalition politics.

Thank you very much, Mr Assistant Speaker. What we’re hearing from the Opposition is a whole lot of excuses as to why they don’t want to protect the sovereignty of New Zealanders by ensuring that this bill goes through and that we make the most of the opportunity we have before the Comprehensive and Progressive Trans-Pacific Partnership agreement (CPTPPA) comes into effect. That is the reason—as the Minister explained at the start—why there needs to be a truncated select committee process, because otherwise we lose that right. Now, I would think that most New Zealanders would want to ensure that overseas speculators can’t continue to do as they’ve done under the former National Government. They would want to—

💬 Hon Todd McClay: I raise a point of order, Mr Speaker. You said earlier that it was a very narrow debate, and I accept that, on the edges of that, when people are giving reasons why the time frame needs to be shortened, it’s important. But the bill doesn’t actually mention speculators and, therefore, the member is going way outside justification of why a short time frame is needed. Indeed, actually, two extra months would not change anything that she has said so far, and she needs to come back to the point.

The ASSISTANT SPEAKER (Adrian Rurawhe): I thank the member for his intervention, 45 seconds into the honourable member’s speech. There has been—it’s not the only contribution that has gone outside of the motion, and I’ll go back to the Hon Eugenie Sage and ask her to come to the motion.

Thank you, Mr Assistant Speaker. So there is a good, solid reason why this bill must go through a truncated select committee process. That reason has been clearly explained. We will shortly be dealing with a bill on the Christ Church Cathedral reinstatement. That also has gone through a short select committee process, but there have been some significant changes made to the bill as a result of submissions.

Last year, when we considered the Hurunui/Kaikōura earthquake sequence, the legislation around that also went through a truncated process, and that resulted in changes too. I am confident that because of the significant national interests at play here in this bill and the fact that New Zealand is constrained by the CPTPPA, that is a good reason to go through a truncated process. Ordinarily, of course, a six-month period would apply. That would allow much more time for people to make submissions, but if people are encouraged to recognise the significance of this bill, then I think New Zealanders, generally, would understand the need for a shortened process.

It is going to select committee. There is an opportunity to make submissions, and I think the Opposition is just trying to drum up a whole lot of arguments as to why they actually oppose the bill.

I’m very pleased to be able to talk to this motion. I want to raise a couple of points. The first is: for those members or those people that are sitting in their homes right now, it’s really important for them to understand what it takes to actually get legislation back through the House. So it’s not only the fact that Parliament has to open the submissions process; the submissions then have to be prepared by members of the public. They then have to come back to the committee. We’ve then got to see a departmental report. Then you’ve got to see a committee report, and then it’s got to come back to the House. For members opposite to say that that is reasonable by 20 February, on a piece of legislation that involves real estate agents, conveyancers, lawyers—massive implications in terms of land law—is totally outrageous.

I was very pleased to hear the Green Party make it down to the House, and I do want to acknowledge Eugenie Sage; you know, it’s important that you came down. But, coming back to the point of issue, it does matter that that is a party that we have been lectured by for many years about the need for good process in terms of select committees, and to have them come down and argue, a day before the Parliament rises, that it is reasonable to have a select committee process ending on 20 February, is outrageous.

If we actually look at the fact that there are statutory holidays, what this bill should actually be called is the “Cutting of Holidays Bill for Real Estate Agents, Conveyancers, and Lawyers”—the people who care deeply about these issues. The reality is they will have a mere couple of weeks to get submissions in, back to committee, on very complex issues. Look, we’re not the only ones that are saying this. In fact, I understand, in the regulatory impact statement (RIS), actually, these issues were raised, and I think one of the greatest issues that was raised in the RIS was that if this legislation is rushed, there are serious risks as a result of that. So we’re not the only ones in the Opposition raising that.

As my colleague the Hon Todd McClay raised, we then get to the substantive issue: is there a strong argument by the Government to actually be pushing this through on unreasonable deadlines? And, as we’ve already mentioned—I’m not going to try and say the Comprehensive and Progressive Trans-Pacific Partnership agreement (CPTPPA)—the Government members have claimed that this is the actual reason why we are here debating an unreasonable deadline for this legislation. And, as my honoured colleague the Hon Todd McClay mentioned, there’s no date to sign, there’s no date for the parties to actually meet to discuss some of the issues, so it is absolutely, again, unreasonable to be arguing that the sole reason we are here with this legislation, with this unreasonable deadline, is because of this issue. The reality is, as many of my learned colleagues have already mentioned—

The ASSISTANT SPEAKER (Adrian Rurawhe): I apologise for interrupting the member, but the time has come for me to leave the Chair for the dinner break.

Sitting suspended from 6 p.m. to 7.30 p.m.

Look, as I was saying before the dinner break, this is outrageous in terms of process. We have a situation here where this bill is being rammed through by 20 February. Now, if we actually look at the time taken to consider this bill and you take into account all of the statutory holidays—from Boxing Day to Christmas Day, to New Year’s Day, to the day after New Year’s Day, potentially Auckland Anniversary Day, to Waitangi Day—we actually have a situation here where, with one day left of Parliament, we’re likely to have submissions called for and, effectively, a couple of weeks, really, of time for people to be able to get back their submissions. We’re going to have a departmental report, a committee report, consideration by committee—so several weeks is what this Government thinks is urgent, to be able to push and ram through this bill.

As we’ve already heard from many of my colleagues, the reason given by the Hon David Parker, who, I should add, made many comments when he was previously in Opposition about points of process and the importance of having a decent select committee process, is the CPTPPA. And, as we heard from the Hon Todd McClay, the reality is this is a sham reason being put forward, and we submit, on this side of the House, that there are very clear reasons why it is a sham. The first reason is there’s no actual date to sign the agreement. The second reason is there are actually issues with the agreement and there’s not even a date for those parties to meet and resolve the issues.

And then the third reason, which we put on this side of the House—and the Hon Todd McClay has already touched on it—is that even if the Hon David Parker was some kind of international powerhouse and managed to power through all of these issues in January, even if it was signed, the reality is often with these types of agreements it takes months, sometimes years, for countries to ratify. So the real reason that we have a situation where many New Zealanders, from real estate agents to lawyers, to people who have an interest in land, are being required to come back in January, cut their holiday short, not be at the beach, but actually be preparing submissions on this bill is because the other side can’t hold it together.

We’ve already seen the waka-jumping legislation. What this bill is about—and many other things we’re seeing from this side of the House—is that the other side can’t hold the Government together, so they need to push things through really quickly and really fast. It’s sort of the waka speed legislation. That’s what we’re dealing with here. They’ve got to create rules around waka jumping to stop people from jumping out of the waka, and now they’ve got to push some stuff through, coming back to this motion and this amendment, which is: “Why is this bill being rammed through quickly?” They’ve got to push it through because they’ve got the Green Party pulling on one side and then New Zealand First pulling on the other side. It’s very clear it’s a sham in terms of CPTPPA. We know that, and we know that there’s no date for it to be signed. We know that there are issues with the agreement, and we know that there’s not even a date to sign that agreement.

So the Government believe that it’s OK to leave a couple of weeks in January, and we on this side of the House want to remind the members opposite of some of the lectures that they have previously given. I want to do a shout-out to the Parliamentary Library—a happy Christmas to the Parliamentary Library. Thank you for your incredible work in the last 40 minutes to bring to the House some previous statements by members around issues of process. I want to read this statement in terms of issues of process made by an honourable member, “This is an appalling piece of legislation … grandiose in intent, and flawed in its detail, and it really should go in the trash can.” That was a statement made by the Hon David Parker on issues of process. So what we know is that they are lions in Opposition but little mice in Government.

I can say to the member that there are a range of other statements that I have pulled up, with the help of the wonderful team at the Parliamentary Library—I just want to do another shout-out to the Parliamentary Library. Whether it’s on the marine coastal bill, whether it’s on passport laws under urgency, again you’ve got the Hon David Parker previously being a bastion of process, and we are here talking about whether it’s reasonable to enable this legislation to have to come back to the House by 20 February. On this side of the House, we’re saying there isn’t a decent reason. The reality is this is about political convenience and the fact that the Government has to hold it together, and if they do have time, then it might be that New Zealand First or the Green Party end up pulling from one thread of the Government and things fall apart.

And the reality is that during this period what we know is that there are many statutory holidays. The other point that I would make is that what the member has done in terms of bringing this bill to the House—and it’s happening today—means, effectively, there’s 24 hours likely for the select committee to have to convene, to have to determine the dates around the submissions, to have to say to New Zealanders, “You’ve, effectively, got only a few weeks in January.” So, assuming that we get through this debate, I’m assuming that the chair of the committee is going to have to go back to their office, call this meeting, a meeting will have to happen tomorrow—

💬 Hon Members: Ha, ha!

I know that members opposite are laughing, but, actually, this is really serious. It’s not just about members of Parliament; it’s about the real estate agents, the conveyancers, the lawyers in New Zealand, the people that are impacted by this, and we haven’t been given a decent reason. We’ve been given a sham reason, and members on this side of the House contend that it is also totally at odds with lectures that we’ve had from members like the Hon David Parker, who have opposed measures like this in the past.

Thank you, Madam Deputy Speaker. Yes, it’s a pleasure to be talking on this amendment that the Hon Gerry Brownlee has proposed, which is to extend the report date from 20 February to 19 April, to reflect reality, I think. I think the first thing I’d like to talk about, before I talk about a number of specific issues relating to this, is that, first of all, I want to acknowledge the Hon Eugenie Sage from the Greens for actually having the courage to stand up and put forward the Green view—

💬 Madam DEPUTY SPEAKER: Order! You can’t talk about members having courage, or lack of courage.

—for talking about the bill—yes. I’ve got to say that I just wanted to compliment her for taking that step, because I think it’s important that the Greens are on record. But from what I recall from the conversation just before the tea break, the Hon Eugenie Sage was saying that whilst the Greens’ view was that the whole issue is important and should be taken through as quickly as possible, the big issue I have with that is that we’ve heard from the Greens many, many times—even in this Parliament; the 52nd Parliament—around the issue of transparency and openness. I think that just cuts across that whole principle. I think that’s a very important principle that we’ve talking about tonight, and at least Eugenie Sage was up front about it and clear that she thought that we should be cutting across that principle.

But the thing I found of perhaps more concern was the early conversations regarding this bill by the Hon Shane Jones. He started out by making a statement—I’m just reading it from the Hansard here—“Now, when the bill goes to the select committee, no doubt, people will endeavour to change some of the provisions. Some might say they’re too restrictive. Some [should] say we [should] let the Aussies enjoy the privilege that we ordinary Kiwis have. That [will] all be teased [out] through … the select committee.”

So, in principle, that sounds fine, but the bit I find very offensive—particularly being a member of the select committee that will be listening to this bill in due course—is that he went on to say, “I say to the other side of the House”—and this is my side, where I’m speaking from—“as they look for people who will continue to find reasons to oppose this bill—which will, actually, because of arithmetic and the coalition agreement, pass, irrespective of what select committee it goes to; irrespective of what mischief members of that select committee might get up to.” I think that cuts across the whole principle of the workings of a select committee, and no doubt the honourable Minister who has proposed this investment bill will want to make sure that this select committee takes the time to actually go through some of the provisions of this bill in detail to make sure that the bill, when it is passed, is in the best form it should be.

Of course, we are talking about Speaker’s ruling 102/7, which says, basically, that if we truncate the select committee process, we should be moving forward as quickly as possible. My issue with this is that if you want to truncate bills, you’ve got to have a very good reason, of course. But the biggest thing about this bill is that it is a very complex bill, and I just want to highlight just a couple of issues in that regard. The first one—

💬 Madam DEPUTY SPEAKER: As long as you do that in relationship to the timing of the select committee.

Yeah, it’s in relation to the timing—yeah. I just want to highlight some of these issues because this is why I think this does need due time. The first thing is that I talked about the process for how this bill is going to be operating. One is around the definition of lifestyle blocks and residential blocks, and the lack of clarity around that definition and what that may mean in terms of how foreign buyers may want to use those provisions to get around the elements of this bill.

The second one was around the process for people making Overseas Investment Office (OIO) applications. I did take the House through some of the process for that—very convoluted, very long—and, again, the timing around that and the complexity and the obligations on the OIO. It is one of the considerations that the select committee is going to have to take into account in terms of the workability of this bill, and that is another area of complexity.

The third area is the liability of conveyancers, how they are defined, and the groups of people involved in that, and the fourth was the definition of the mandatory conditions, particularly around the definition of development land, which, in my view—when you look at it, the definition around development land, I think, will be a potential area of a great deal of dispute and submissions from a number of parties. If you want to be a foreign buyer and you want to develop land and buy land in New Zealand, you will buy it and use the definition in a way that you may say you’re going to pull down a building, but you’ve got no time commitments around it. I think that is, perhaps, a wedge that many foreign buyers—

💬 Dr Duncan Webb: I raise a point of order, Madam Speaker. The member is speaking to the substance of the bill, not to the motion.

💬 Madam DEPUTY SPEAKER: Yes, that’s fine, but it is certainly in the Speaker’s prerogative to judge that—I thank the member for his assistance. I would appreciate it if the member comes to the substance of the motion, which is about the time—

Thank you.

💬 Madam DEPUTY SPEAKER: —that the bill will be in the select committee.

OK. So the reason why I’m highlighting those four issues is that if you start to look at who might have an input into that and who might want to come and see the committee and make proper representations, I think you can start to go through them. There will no doubt be accountants, there will no doubt be lawyers, there will no doubt be financial advisers, there will no doubt be real estate agents, there will no doubt be immigration consultants, and there will no doubt be banking representatives—because they will be funding some of this—and the seventh will be fund managers. I think that if you start to work through how many submissions you might get in each of those areas—

💬 Madam DEPUTY SPEAKER: I won’t be working through.

Sorry, Madam Deputy Speaker. If people sit down and actually work out how many potential submissions the committee might receive from these specific groups, that adds up to a considerable number of meetings where the select committee is going to have to listen to very technical, detailed submissions. I just put it to you that that alone justifies why the select committee needs proper time to consider these complex issues.

Now, the other one—I just want to go to Standing Order 195(1), which is: “The chairperson of a select committee may, on behalf of the committee, request any person to attend and give evidence before the committee.” I think, again, by pushing this through in such a short period of time, it is cutting across the right of the Finance and Expenditure Committee to actually operate in an effective manner, and I put it you that that alone is one of the most serious issues with the requirement to bring this all forward, well before what would otherwise be a normal length of period to hear complex arguments. I think we will as a committee, no doubt, be wanting to get some independent input, particularly around the legal aspects, from some of the Government advisers—as well as some of the financial aspects. I think that will all come to pass, and to be pushing that through in late January or early February will be very, very difficult, and will actually lead to a piece of legislation that I don’t think will be in the best interests of New Zealanders.

Now, the other thing with regard to the chair having the right to call people is around the sense of equity about better public engagement. Even if you accept the proposition that the professionals can get back from their holiday, prepare adequate submissions, and give the committee the time to review those properly and hear from advisers, the issue is about the wider public engagement, and I just think that this is a very, very important issue. There will be a lot of public interest in this, and, during the course of January, no one will be focused on this. I think we need to be in a position where the public can have significant input on this matter.

I would just put it to you that not only is that in the public interest but, actually, it is about good government. Being a member of that select committee, I’m in no doubt that all of us—the diligent members from both sides of the House on that committee—will want to take the time to make sure we are hearing all the evidence and advice from the people who have a proper interest in this aspect.

So I just would like to resubmit that I don’t believe that this is in the best interests of the House. I fully support the amendment by the Hon Gerry Brownlee that this report-back date be deferred from 20 February to 19 April. Thank you, Madam Deputy Speaker.

I move, That the question be now put.

Thank you, Madam Deputy Speaker, for the opportunity to speak in this debate.

💬 Hon Ruth Dyson: Oh, this’ll be worth waiting for.

I’m glad you’ve been waiting for it, Ruth Dyson—been waiting since 1993 for a debate like this, I’m sure. I’m pleased that we are debating this. It does deserve the attention of the House prior to us actually voting on it, the reason being that we are considering—let’s break it all down—a truncated select committee process. That is not unusual for the House—it does happen from time to time; I accept that—but we’re considering a truncated select committee process that travels over the Christmas break.

If we’re to ask ourselves, “How do we make good policy?”, and if we’re going to ask ourselves, “How do we ensure”—as I know Speaker Mallard and the Leader of the House, Chris Hipkins, believe in—“that a proper MMP parliamentary process goes into the consideration of bills at a select committee?”, we have to step back and ask ourselves, “What’s a decent amount of time for a committee to be considering a piece of legislation?” And a piece of legislation that attacks, somewhat, the rights of individuals to own property in a country is one that I think deserves both more than two months’ select committee process and, certainly, a process that does not extend over the time in which, basically, New Zealand shuts down for a month, people go on holiday, and people are not engaged in what is happening politically. Now, most New Zealanders probably stopped engaging in politics on 1 December, and they probably don’t start engaging again until 1 February. There are others of us who spend a lot more time on these things, but New Zealanders, average New Zealanders who care about these issues, who want to submit—even professionals who are interested in these issues—deserve more time to do so.

I want to talk a little bit about the people in my electorate that I think will take an interest in submitting on a piece of legislation like this. I represent the Botany electorate, which is number one, when you scale all the electorates, in individuals living in an electorate that were born outside of New Zealand. My electorate has 51 percent of its population born outside of New Zealand. Many of those individuals that were born outside of New Zealand are what Phil Twyford might call people with Chinese-sounding names. Certainly, we’re very multicultural, and there’s a high migration into my electorate. Those are the very people who are affected by this. Those are the very people who have family members that would be impacted by this. I’m offended, on their behalf, that they will get only two months, over the Christmas break, over the summer holiday break, to submit on a piece of legislation like this.

I note that the Standing Orders Committee, in 2011, considered this very issue. The Standing Orders Committee, in 2011—whilst I was very junior back then and was not involved, I’m aware of the report. I’m aware that there was discussion at that committee about the norm for select committees to consider legislation. The norm is six months. The committee of the time decided that if there was going to be a change in the time period by which a committee was to consider a bill, a high bar should be set, and almost a penalty should be put in place for a Government.

We’re, effectively, in the penalty time right now, where we are debating this as a Parliament. The committee felt very strongly at the time that there should be some ramifications for a Government that wanted to change the time period. There isn’t much sitting in Speakers’ Rulings, but there are some words about how select committees should have six months or more to consider most bills. There is no intention for the default period for select committee consideration of bills to be shortened, and the Government should exercise due restraint when considering the truncation of the select committee process.

I submit to you, Madam Deputy Speaker, that the Government has not exercised due constraint. We are aware of the fact that the Government has not exercised due restraint, by looking at the papers that are on the Table, prepared by Treasury. What is the urgent legislative need for a committee to consider this bill in such a short time frame? What is the problem that has been defined? Well, the problem that’s been defined is that the Government has a 100-day commitment to ban overseas speculators from buying existing homes. That is an urgent issue, because an election was held where—more New Zealanders voted for the National Party than any other party—the Labour Party had a policy and they arbitrarily decided they wanted to implement something within 100 days.

That is the only urgent situation that we have in front of us. That is not an urgent situation that should be one in which we take away the rights of New Zealanders to submit. That is not an urgent reason to remove the rights for New Zealanders to submit to a process. That is not an urgent reason to take away the rights of my constituents, most of which are migrants, to have the ability to submit on a piece of legislation that is designed to attack them. The problem that is defined in the papers that we are seeing on the Table, the problem that the Government has when they’ve come to the Parliament with a piece of legislation—simply that they want to implement something within their 100-day commitment—is no right to take away the rights of New Zealanders.

We also are aware, reading this piece of paper, that there are some significant issues that need to be addressed. There are significant issues that the committee is going to have to look at. Those are issues that a committee should, quite properly, put a lot of effort into.

We have done a bit of a calculation. We said to the staff, “Hey, you guys are smart. You’ve done this before. What is the typical time period by which a committee would need to properly consider a bill? Start at the final point where it delivers the report back and work back from there, and tell us how much time we have.”

We’ve done a bit of a time line: first reading, 19 December; if the Finance and Expenditure Committee (FEC) sits tomorrow and calls for submissions on 20 December; if they truncated that time period, that normal time period we give to people to submit. We said, “Let’s say, get submissions back in by mid-January.” That’s a month’s time to get submissions in—actually, it’s less than a month’s time.

💬 Hon Steven Joyce: It’s mid-January.

It’s mid-January; that’s right. Most New Zealanders will be experiencing and enjoying Christmas next week and then they’ll go and enjoy the beaches, enjoy Andrew Bayly’s and Stuart Smith’s electorates and my electorate. They’ll be doing that instead of wading through a poorly written piece of rushed legislation.

But if they get their submissions back on 17 January and FEC has some time to consider those submissions—let’s just say the Finance and Expenditure Committee has the time to hold a hearing. They’re not going to have much time to hold a hearing, because they have to instruct the Clerk’s Office as to what they need to do. They need to instruct parliamentary counsel. If they hold submissions on 24 January—and the reason we’re suggesting they need time between 17 and 24 January is so they can actually process the submissions. Let’s remember, the staff, the very people who have to do the work on this, they will be wanting to experience and enjoy a summer holiday as well. If they hold hearings on 24 January for several days, if they manage, and this will be difficult, to get the bill and the submissions all processed in a reasonable period of time, they probably could deliberate on 31 January. Then they could go and ask parliamentary counsel to go and consider drafting changes.

There’s going to be a lot that’s required, because we know, from Treasury’s own words, about all the problems that are in place. Some of my other colleagues might want to investigate this in more detail. They’re going to have to go and instruct the officials as to what they need to do. Probably by 7 February the drafting changes will be back before FEC and that’ll be considered. If they are able to approve the drafting changes by 7 February, then by 14 February they can probably get to a point where they would be able to approve a final version of the bill.

They need to go back to caucuses too. There is a convention, I know, amongst the National Party and amongst the Labour Party and other parties, that these things should go back to party caucuses. If MPs are going to have a reasonable opportunity through the select committee process, through their members, to contribute towards the bill, there needs to be time for it to go through a bit of a caucus process as well. They should be able to look at this on 14 February, all so they can get it back into the House on 20 February.

That is an unbelievably short time frame, especially over the Christmas break. Because the Government has some urgent reason to get their 100-day programme in, we’re now having to force New Zealanders to go through this process and force a select committee to look at a truncated process for a bill that is rushed, which is poorly drafted, and for which Treasury has indicated there are substantial risks and unintended impacts that I know that the House should properly consider. Fundamentally, this bill is about taking away the rights of individuals to purchase property. If you’re going to go and impact on people’s lives in such a way, then we should be doing it in a thorough process.

This side of the House is thoroughly unimpressed with the time frames that are being considered. We expect there to be a longer time frame, and we’ll be supporting the amendments in Gerry Brownlee’s name to have a date in April as a report-back date to consider this bill. Thank you very much.

Madam Deputy Speaker, thank you for the opportunity to speak in this House. The Government has given the reason for this particular time frame, as part of their 100-day plan. Well, I’m actually also in my first 100 days and I’d like to make some reflections on what I’m observing.

First of all, there’s been a lot of confusion in this House today as to what the Trans-Pacific Partnership agreement (TPPA) actually is called—whether it is the Comprehensive and Progressive Trans-Pacific Partnership agreement—

💬 Hon David Parker: Yes.

I’ve got it right, the Hon David Parker; that’s good. But there’s been a lot of confusion. That, in itself, speaks volumes not only for the people in this House but for the population of New Zealand. Some modifications were made to the National Party TPP agreement when you went overseas, and the name was one of them, but also some of the foreign-buying regimes—[Interruption] Madam Deputy Speaker, I’m coming to the time frame because that is very relevant. In this very House, before dinner, the Minister advised that this—TPPA—this new one, is unlikely to be signed or could be signed in about two years. So I put it to you: what is the rush? We have a select committee process. We have Speakers’ rulings that have been quoted by many of my colleagues. Speaker’s ruling 102/7 talks about how you should truncate select committees for a very good reason. I struggle to find a very good reason, other than the 100-day plan.

We also had, earlier in the day, a member on the other side saying it doesn’t matter what happens at the select committee or in any other process, because the Government is just going to do this anyway. Well, I think that is a gross abuse of our democratic power and the regime in which this House should operate. But, more importantly, I want to refer to this document, which is a Treasury document that says, when it looked at the range of options considered, “This analysis has been constrained by the Government’s commitment to implement this specific policy. As such, no other housing policy measures—for example, policies that would support the broader objective of increasing the supply of residential property or wider overseas investment regime issues—have been analysed or evaluated.”, and then further goes on to say, “There has been no consultation with the private sector organisations or the public.”

That’s the point I wish to get to, because the Hon Gerry Brownlee put up an amendment that actually, effectively, added another two months, and I think that is a reasonable response to the situation we find ourselves in. The new piece of information I wish to bring to this House relates to what I did in my previous role. It would be unheard of in local government for a council to put out a significant piece of consultation one day before Christmas and expect to have submissions at 20 February. In fact, I’ve had hundreds of letters in my national and local role over the years from people objecting to it, yet it seems OK, on the Tuesday before Christmas, to rush through a time-framed piece of work and then go out, basically, on Christmas Eve and tell people that there will be an opportunity to participate in something and submissions will close well before 20 February.

We all know that in New Zealand everybody likes to take most of January off, so I think, for the significance of this bill and for the issues involved, we are doing both this House and all the people that would like to submit to this process a disservice, whether they are real estate agents, rest home operators—and we heard today, actually, it’s going to be OK for a foreign investor to set up a rest home. Imagine what the other the rest home operators will think of that.

So I believe that nobody will actually focus on this issue between now and about the end of January, professionals or individuals alike—and imagine what is going to occur tomorrow. Are all these institutions that represent real estate agents, lawyers, accountants, and rest homes going to send out something about what this bill says when the bill was only made public at 1 o’clock today?

In this short call, all I really wish to say is that it is my first 100 days, but I look at this as a sham. I look forward to it going to the Finance and Expenditure Committee, which I happen to be on. There are lots of parts of this bill that need intense scrutiny, and the public needs to have a say. I don’t think it’s fair on us or the public that this new, truncated time frame is put together that means we’re going to hear it on 20 February. Thank you.

I move, That the question be now put.