Annual Review Debate — Social Development and Housing Sector

Kia ora, ngā mihi nui ki a koutou, kia ora. I rise to speak in the annual review debate on the Social Development and Housing Sector. As the chairperson of the Social Services and Community Committee, it was a privilege to work with members across three other parties and the entities reviewed to conduct the annual review hearings. We conducted hearings and tabled reports from the Ministry of Social Development, the Ministry for Vulnerable Children, Oranga Tamariki, Housing New Zealand Corporation, the Office of the Children’s Commissioner, the Ministry for Pacific Peoples, Sport New Zealand, the Artificial Limb Service, the Ministry for Culture and Heritage, Tāmaki Redevelopment Company, the Ministry for Women, and the Museum of New Zealand Te Papa Tongarewa board. We also conducted annual reviews of Drug Free Sport New Zealand, Heritage New Zealand, the Arts Council of New Zealand Toi Aotearoa, the Families Commission, the New Zealand Film Commission, the New Zealand Lotteries Commission, the Office of Film and Literature Classification, and the Social Workers Registration Board, and had no matters to bring to the attention of the committee from these entities.

I want to quickly run through each of these entities and give a quick highlight from what the committee heard. Looking at the Ministry of Social Development, they play a critical role in our society, providing social welfare benefits, superannuation, benefits, emergency housing, and care and protection of children and young people. The committee asked questions around measuring child poverty, and over the next few months the committee will hear submissions on the Government’s Child Poverty Reduction Bill. Housing New Zealand manages around 63,000 homes, housing 180,000 Kiwis, and we heard about their work for affordable Auckland KiwiBuild and new State houses. On a related note, we heard from the Tāmaki Redevelopment Company, a company with joint Crown and Auckland Council shareholding to transform Tāmaki over the next 25 years. Key issues canvassed by the committee were the speed of housing development, procuring a large-scale partner, and home affordability and the KiwiBuild programme.

The Ministry for Vulnerable Children, Oranga Tamariki was created in April of last year, and was renamed Oranga Tamariki—Ministry for Children in January this year. The ministry works in a child-centred system with high aspirations for Māori children, investing in tamariki, amongst others, and the committee heard there are currently 5,700 children in State care. They told the committee their priority areas are for quality social work practice, increasing the number of safe and loving places for children, and creating stronger partnerships with iwi and NGOs to commission stronger services for children. We also heard from the Children’s Commissioner on his work advocating for children and New Zealanders aged under 18. We discussed setting targets to reduce child poverty, developing a national strategy to promote the well-being of children and 17-year-olds in the youth justice system.

We heard from the Ministry for Women on their work for pay equity, increasing women’s opportunities in education and public honours. An area they’ve also been conducting research into is the gender pay gap. The Ministry for Pacific Peoples told us about their work on the Pacific Employment Support Services, developing a language strategy, connecting with Pacific regions, and promoting Pasifika people in the public sector. With Sport New Zealand we discussed the declining levels of participation in sport amongst young people, adults, and volunteers. The committee was concerned about declining levels, and noted in the Community Sport Strategy 2015-2020 the need to measure effectiveness of investing in community sport.

We acknowledged the 20th anniversary of Te Papa in their review, and discussed their plan to open a new museum in Manukau, South Auckland; opportunities for growth; and the ability to meet demand. And lastly we heard from the New Zealand Artificial Limb Service, and they told us of their work supporting the 4,354 amputees in New Zealand. We discussed property issues with their limb centre, arising from historic peppercorn rental leases. We heard that the buildings face significant issues involving deterioration, leaks, and earthquake rating, needing repairs and investments. They told us these issues were close to resolution, and they were in the process of negotiating new contracts with district health boards and ACC to provide more funding.

As a new member on this committee this term, it was a privilege to learn more about the work of these Crown entities and their dedicated public servants. I’d like to thank committee members, the staff, and public servants, who all played a role in this important aspect of scrutinising public investment in these entities. Kia ora koutou.

Thank you, Madam Chair. I haven’t taken a call for a while, so it’s nice to be back in the House and in this annual review debate. I want to acknowledge Miette Wooller-Harris, who is a year 13 student at Rutherford College, in my electorate. Miette is interning in Parliament this week and is in the gallery for this debate.

I want to talk about housing. It’s appropriate that housing is grouped together with social development, because the housing crisis that the former National Government allowed to spin—

💬 Hon Dr Nick Smith: How many houses, Phil?

—out of control so badly, when the Hon Dr Nick Smith was the housing Minister, is responsible for most, if not all, of the poverty and inequality that we’ve seen over the last decade in New Zealand. The housing crisis has exacted a terrible price on the people of this country. This Government inherited a shortfall of 71,000 houses that built up entirely on the former National Government’s watch, including during the period that we’re debating—71,000 houses short across New Zealand and 45,000 in Auckland alone.

Homeownership has fallen to a 66-year low. Homeownership hasn’t been lower in 66 years, and what did the former National Government do about it during its time in office? They made an artform of tinkering, of minimalist incrementalism, and of making excuses for doing nothing. That former Minister across the House, Nick Smith, was the arch practitioner of this whole policy of doing as little as possible while the housing market was allowed to burn.

What did they do with State housing? The institution of Housing New Zealand, which has been there for decade after decade as an expression of New Zealanders’ compassion and belief that every child growing up in this country should have a decent roof over their heads, no matter how life might be a struggle for mum and dad, and for people who would otherwise really struggle to get a decent roof—

CHAIRPERSON (Hon Anne Tolley): I hate to interrupt the Minister, but, again, could he relate it back to the appropriations. Just relate it back—we’re halfway through.

I’m going to talk about the appropriations—

CHAIRPERSON (Hon Anne Tolley): Good. I look forward to it.

—because I’m talking about State housing—State housing that was sold off during the period of this annual review by the former National Government. In the middle of the worst housing crisis in living memory, what did they do? They sold off State housing. They are so desperate to wash their hands of the fundamental responsibility to put a decent roof over the heads of people who need it.

When we came into Government, we asked the officials, “What’s going on with the State house sell-off?” In Christchurch, 2,500 houses—including the State house that John Key lived in as a child—were in the process of being hocked off. They had been doing trade shows in Australia—trade shows in Australia—to try and sell off the State housing. There were another 700 houses in Invercargill that they were selling off, and it was really only the utter embarrassment of two winters of record homelessness that embarrassed them into any kind of action at all.

I want to mention the other real casualty of the housing crisis, and that is the 40,000-odd kids who, every year, get bundled off to hospital with respiratory and infectious diseases, and the 1,600 mostly older New Zealanders who die premature deaths every winter in this country because the state of the housing that they’re living in is so poor. The best after nine years in office, and during the period that we’re debating in this annual review—the very best that Dr Nick Smith could summon up—was to require smoke alarms and a very, very weak, inadequate insulation standard. It’s been left to this Government to come in and take some serious measures to actually require not only an inadequate insulation standard and smoke alarms—which in themselves might be OK, but in the circumstances are woefully short of what’s needed—but a serious, modern set of standards that would require landlords to ensure that rental properties are warm and dry. Why shouldn’t they be required to do that?

It’s a scandal that half a million Kiwis are living in rental properties, some of which are in an appalling condition and are a risk to their health. Our healthy homes guarantee will require that rental properties are dry and are heat-able and that they will address drainage, address draught-stopping, and address moisture control—none of the things that the legislation passed during this annual review period, under the sponsorship of Nick Smith, addressed. Our healthy homes guarantee will finish the job that was started under that Government but was left uncompleted.

So there are, I think, four key factors underlying the housing crisis—four drivers of the housing crisis—that are responsible for the misery that we saw, year after year after year, under the former National Government. They are, I believe, infrastructure financing, which is the biggest roadblock to the ability of our towns and cities to grow up and out; the planning system, which is a highly restrictive planning system that chokes off the supply of available land, drives land prices up, and triggers speculation and land banking, and is one of the main factors that’s responsible for the absurdly expensive urban land prices that we have; a low-productivity construction industry that has very high build costs at very low productivity and that is rife with anti-competitive practices; and, fourth, tax settings that encourage an economy of land banking and property speculation. Those are the four big drivers of the problem we have. In nine years, including in the period that we’re debating in this annual review, the former National Government did next to nothing about each of those four factors—next to nothing—and that, I believe, is an absolute scandal.

I want to talk, in relation to those problems that I’ve raised, about what this coalition Government led by Labour, supported in coalition by New Zealand First, and in confidence and supply by the Greens—I want to talk about what we’ve done in six months. In six months, we stopped the State house sell-off—one of the first things we did—and we’ve commenced a massive State house building programme. We’ve set up a KiwiBuild unit—

💬 Hon Dr Nick Smith: 18.

You mark my words, Dr Smith, you’re going to see a lot more KiwiBuild houses coming down the track. You just mark my words. We’ve set up a KiwiBuild unit in the Ministry of Business, Innovation and Employment, which is overseeing the development of large, complex urban development projects, and a mass Government procurement programme to build affordable homes for first-home buyers.

There are 155 new State houses in the regions—the biggest and only significant building programme of State housing in the regions in more than two decades. That former National Government sold off State houses in the regions. They did not build any; they sold them off, and regional New Zealand won’t forget that.

We are in the process of banning foreign buyers, so that only permanent residents and citizens of New Zealand can buy the existing housing stock. We want foreign investment in the building of new homes and in new developments, but we will not allow offshore speculators to bid up the price of the existing housing stock.

We have work under way on reforming infrastructure financing and freeing up the planning system.

💬 Hon Dr Nick Smith: What about the RMA? Where’s your RMA changes?

We will reform the Resource Management Act (RMA), but not in the tinkering way that Nick Smith did that made the RMA more complex, more expensive, and more burdensome.

CHAIRPERSON (Hon Anne Tolley): Can I just ask the Minister, please, in the last 30-odd seconds, could he actually talk about the appropriations for the period 2016-17.

Madam Chair, it’s perfectly admissible within an annual review debate to talk about the period right up to the present. Members on that side of the House—

CHAIRPERSON (Hon Anne Tolley): I would appreciate it if the member would relate that to the appropriations. This is not a policy discussion.

The first KiwiBuild homes, at McLennan, were unveiled the other day—18 of them—and they will benefit from a $2 billion appropriation that will kick-start the KiwiBuild programme. There are going to be many more coming. We are rolling out the emergency housing around the country that that former Government never did.

Madam Chair, I’m not at all surprised that the Minister coughed and spluttered his way through those 10 minutes, given the embarrassment that he is to his party and to himself over the debate for these estimates.

I sought a piece of information from the library, and it was this: how many times did that member and that party promise 10,000 homes a year—10,000 homes a year? The answer is—I’ve found 167 news clips in which they promised 10,000 homes per year. The extraordinary part, about which every member opposite should be hiding their heads in shame, is the press release from the member last week that said that by the end of the next financial year, which is 20 months into this Government, they will have built a thousand—20 months, and they’ve achieved a thousand? Look, I was just gobsmacked at the audacity of the Minister to promise so much and to deliver so little.

At the core of the housing issue is getting more houses built. Let’s look at the financial year under review: 31,200 homes built. That’s more homes that have been built in this country than for 30 years. Every year, in fact, for the last five years, we’ve seen an annual growth of between 15 and 20 percent, or between an additional 2,000 and 3,000 houses each year—that is, five years ago we were building 14,000 houses a year; we then went to 17,000; 20,000; 23,000; 24,000; 27,000; and, when we left Government, 31,000 homes a year were being built. Members opposite, for all their rhetoric, the best that they have said to this House is that they’re going to build a thousand houses over a year and three-quarters, and I say that is truly pathetic.

I then want to come to the issue of the quality of our housing. Let’s compare the record: if we include this financial year for review, under National we’ve insulated 320,000 homes—320,000 homes, including every single State house. Well, how does that compare with Labour’s previous record? During Labour’s last nine years in Government, they did a total of 30,000—that is less than 10 percent. For me to take lectures from members opposite about understanding the importance of the quality and insulation of homes, I say give me a break.

Here’s the real challenge: in the Budget, we will be watching very closely to what degree they lift that pace of home insulation. We passed a bill that requires every house that is rented to be insulated by July next year—every single house. Here’s my worry: these guys are sitting on their hands doing nothing, and I’ve got my doubts. For all their criticism that they made of that target, they have done absolutely zero—absolutely zero—in six months to ensure that that timetable is met, and that deadline. I’ll make a bet to members opposite: for all your grizzling that my timetable of having every rented home insulated by 1 July next year—I’ll make a bet right now, for the best bottle of Nelson wine, that the Government opposite will not meet that target. If you go out and talk to the real world of people that do this work, you know the number of homes that are being insulated is slowing under this Government, not growing. It is slowing, and that is where this Government has been deficient.

The last point I’d make is this: Mr Twyford has said, on numerous occasions—and he’s right, and we agree—that the issue of urban boundaries is critical to housing affordability. That’s why, right now, there isn’t a housing affordability issue in Christchurch. Rents are dropping.

💬 Jo Hayes: That’s right.

There are ample affordable houses, as my colleague from Christchurch, Jo Hayes, says. Why is it, for all his promise of removing the urban rural boundary, that that member has not produced a single bill on housing in his six months?

Thank you very much, Madam Chair. It’s slightly ironic that Dr Nick Smith began his speech with a joke about coughing and spluttering, when he was the housing Minister responsible for a hell of a lot of coughing and spluttering within the Housing New Zealand homes that he was responsible for during his tenure in housing. The period that we are debating here was a lot of the election period, and during that election period, one of the houses that I visited in Linden, in my electorate, which was a State house, had a roof that I put my finger through because of the moisture and the rain that was working its way through the roof and into the ceiling, therefore meaning that the family that lived in the house was, in fact, coughing and spluttering, causing issues for that family that were well beyond just the house, in the school, and then taking them to the doctor’s and the hospital. So I find it slightly ironic that the member who just resumed his seat would make a joke about coughing and spluttering when he was responsible for the degradation of the Housing New Zealand system, which has caused a hell of a lot of coughing and spluttering.

Also, I’d like to talk about some of the campaigning that we did in our electorate around a piece of land in the Castor Loop. The Housing New Zealand houses were demolished on that piece of land back in 2010 and 2011, but we spent a lot of time pressuring Housing New Zealand, pressuring the previous Government, to build some houses on that land. Nothing was done for six years, and in the seventh year, we were pushing very hard to make sure that something was done. During an interjection during another speech, the Hon Tim Macindoe said that some of these houses were demolished because they weren’t in the right places and weren’t appropriate. I would suggest that the land that I’m talking about is well placed for Housing New Zealand homes, because there were homes there. What happened as a result of the removal of the homes is that the likes of local families had to move further afield, the local school saw its numbers drop, and it caused angst among the community because what looked like a park was, in fact, an empty hole in the community, where Housing New Zealand homes should have been.

So we pressured the Government, after six years of inaction, in that final year of their tenure in power, to do something about this. Despite the attempts of myself, as a local MP, and of the local Catholic Church to get a march to highlight the need for more social housing in our area, during that period that we’re debating, there was still nothing from the previous Government to put homes on that site—a travesty and a tragedy for that community in Porirua East. What I am proud to say is that, in the first six months of this Government, we have taken action to put 53 new State homes on that land, which has lain bare since 2010-11. If people around the country, and certainly in my electorate, want to see the stark difference between the previous Government and our Government, it’s that plot of land—it’s that plot of land, which used to have homes on it that may have not been appropriate, and which sat idle for six or seven years, with the previous Government doing diddly squat about it, and not providing homes in an area where there was certainly a demand for more social housing. I am proud to say that, in this very short period of time since we’ve taken power, that project to get those 53 homes built will start very soon.

I thank the current Minister of Housing and Urban Development for making sure that there’s some actual action on the empty plot of land that Mr Smith was responsible for in his time and that sat on his hands for years and did absolutely nothing. When we were looking for leadership from the previous Government during the period that we are debating: still nothing. So what I can say is that I’m proud we were able to campaign on issues that really matter to New Zealanders, and that is housing. Mr Smith said, “Let’s take a look into the real world.” Well, Mr Smith, come into the real world. Come into that house in Linden where I was able to put my hand through a ceiling because the moisture there was so bad that it was causing issues for that family under his watch—under their watch—and they did absolutely nothing about it. So I’m proud to sit on this side of the House and talk about the six months that we’ve been in charge over here, because we’ve done something that the previous Government didn’t.

Just before I call the next speaker, I have tried to remind members that we are discussing the appropriations. Whilst it’s very interesting to give examples of policies from either side, they must be related to the appropriations. That’s the debate we’re having.

I must admit, I am very partial to a fine drop of sauvignon blanc from the Hon Dr Nick Smith’s Nelson-Marlborough area, and I’ve been spending the last few minutes trying to work out how I can work into the appropriations debate a bet that Dr Smith will take with me that he’s bound to lose, where I will cash in on one of those trials. But, anyway, I will move on.

For those who are listening outside the House, they may not be aware of the fact that this isn’t just a debate about housing; it is the social development and housing theme that was looked at by the Social Services and Community Committee. So I think, having had a good run now on housing, it’s probably appropriate if we turn our attention to aspects of the social development portfolio.

Unfortunately, I didn’t hear the appropriations review for that particular committee, because I’m no longer on it—I was in my early years as an MP. I have to say it’s an area that is particularly dear to my heart. I want to focus on the fact that the current Government—and the Minister for Social Development, Carmel Sepuloni, is in the chair at the moment—has signalled major changes to our welfare system, particularly in the area of obligations and sanctions. I would like just to focus on where we’ve been and where we’re going and highlight just how important that is.

I think something we can all agree on is that the hallmark of a civilised society is how well we look after the most vulnerable members of it, because there’s no question that the welfare system—which is, surely, relevant in this appropriations debate—of which you, Madam Chair, are a very fine former member—

CHAIRPERSON (Hon Anne Tolley): Don’t bring the Chair into it.

I do beg your pardon, Madam Chair. I’m desperately trying to show that I’m going—bring you into the debate. As I say, the welfare system needs to be able to cater for a very large group of people who, in many instances through no fault of their own, have fallen on hard times. They may have suffered a significant setback or there may have been a major downturn in industry in their area—for whatever reason, they need the welfare system.

And yet the quid pro quo of that must be, for it to be as generous and compassionate as we all want it to be for those who desperately need it, that nobody is abusing the system. So when we hear the current Minister, as she did on The Nation on Saturday, in an interview in which she said very little and went all around the tracks—

CHAIRPERSON (Hon Anne Tolley): Look, it’s really interesting, but will the member come to the appropriations and talk about the previous six months but not policy that’s going on into the future.

Right, I’m sorry. The reason I mention this—OK, we’ll go back—is that in the previous six months we have seen the success of the previous Government’s policies: we have seen that unemployment has come down substantially, we have seen that we have a record number of New Zealanders now in employment, and, most importantly, we have seen the success of the social investment policy that was followed, and was still in operation up until the change of Government, initiated by the former finance Minister and latterly Prime Minister, the Rt Hon Bill English, for which I believe he will be very warmly remembered in New Zealand’s history.

Throughout the last decade, New Zealanders have seen some of the toughest times imaginable. Mr English’s driving philosophy was to say, “We will be there for those who need that support, but we need everybody who’s running a programme to show us how it works, we need them to be accountable for every dollar of taxpayer funding that they are spending”—because, after all, social development is one of the big Budget areas for any Government—“and we need to be able to see that it is making a real difference.” It’s not about bean counting; it’s about showing what a difference can be made in people’s lives to get them out of dependency and into the best form of social security that is possible—and that is paid employment: the ability to become self-reliant, for people to be able to look after themselves and their dependants through meaningful work that is paid, rather than for long-term dependency to be the norm.

For far too long, we have seen the trap of intergenerational welfare dependency seeing too many New Zealanders cast aside. I really worry that with the change of policy that is being signalled from the approach that had been taken, we’re going to go back down that track. So it is worth noting just how significant the previous policies have been. I commend the previous Government for that, and I urge the new Minister not to set it aside.

I thought this was the time to respond, given that the Hon Tim Macindoe had brought it back to social development. I want to start by referring to Tim Macindoe’s reflection on the previous Government in inferring that they were successful. I want to reflect on some of the figures in the appropriations that really demonstrate lack of success.

I want to start with the hardship assistance figures. In the December 2017 quarter, we had 290,070 hardship assistance payments compared to 252,000 in the previous December quarter. That’s an increase of nearly 40,000 hardship assistance payments. The main reason that people were seeking those hardship assistance payments was food—was food, the Hon Tim Macindoe. Then, after that, it was housing. Food and housing—a massive increase in the number of New Zealanders needing support from Work and Income, from the Ministry of Social Development (MSD), for the basics.

That doesn’t sound like the mark of success to me—or to this Government. So, when reflecting on that, we need to think about what’s been said already in this debate, and that has been the issues around housing that have been touched on by many of the previous speakers and the impact that that has had on people’s ability to do the basics—put a roof over their head and food on the table. And it’s real—that housing shortage is real. We have seen the demand for emergency housing and hardship assistance grants at MSD be driven up because of the fact that people are struggling to pay the money they need to have a roof over their and their families heads. That, for me, is not a mark of success.

We saw under the previous Government that the complete focus was on their Better Public Services target of reducing welfare dependency, with no real regard for whether or not people were going into work, whether or not people and their families were better off—just the mark of success being if they weren’t on benefit then, therefore, that was a good result for a Government. Well, quite frankly, that wasn’t good enough. There were no checks in place to make sure that those families actually were better off, and then, when you reflect on the fact that the hardship assistance was going up, well that actually shows that there were a whole lot of people that were worse off under the previous National Government—worse off despite the fact that they still tried to sing from the rooftops that success was about pushing people off benefits.

I do want to reflect on that, because it’s really important to touch on it. I also want to talk about the fact that Mr Tim Macindoe touched on welfare reform and the overhaul that we have planned moving forward, because it’s important to contextualise, when looking at the appropriation of the year gone by, why we need to do that. The reason we need to do that is because we need to have a focus in our welfare system that is absolutely around the fact that it has to be about people being better off—about individuals’ well-being—a different approach to the National Government whereby, with their social investment approach, it was about making sure that people were not fiscal liabilities to the State. Instead, from this Government, making sure that we do everything that we can to maximise the potential of all New Zealanders—a very different focus from this Government compared to the previous one, but I have no doubt that we’ll gain much better results, because a deficit approach never works, and that’s what we see undertaken by the previous Government.

We see other things that are of concern with respect to the previous Government. One of them that came up in the appropriations was the massive increase in sanctions that were imposed on people that were going through the welfare system—a 30.1 percent increase in the December 2017 quarter compared to the year before; a 30.1 percent increase in the number of sanctions that were imposed on New Zealanders. Did that help New Zealanders be better off? Well, no, it didn’t, because we still see New Zealanders suffering from food insecurity and the inability to access appropriate housing. So how did imposing a 30.1 percent increase in sanctions improve the lives of New Zealanders accessing the support of MSD?

All of this is really important to reflect on, and I think, actually, it shows very clearly that the assertion made by Tim Macindoe that his Government was a success is absolutely incorrect.

Firstly, for clarity, Madam Chair, I’d like to ask if I am able to traverse both the social development part and the housing part in one debate? [Madam Chair nods] Thank you, Madam Chair. My goodness, because there’s a lot to traverse, to be honest, and they’re all connected, and this is the thing.

So in the appropriations in the annual review for the previous year, what we saw—what we saw—from this previous National Government was a running of our services to the ground. That came through in the appropriations in terms of putting surplus before services, putting a reach for a Budget surplus before ensuring we have got sound, strong, adequate services to make sure our people are well, to make sure they can live in an affordable, safe home that’s not going to make them sick, and to make sure that people have a enough to live decent lives, if they are going to a Work and Income office to try and get the support they need. In the appropriations, we actually saw the previous National Government, in the way that they distributed investments in resources, upholding the degradation of people. That’s what came through in the appropriations.

So I want to pick up that in the previous year—in fact, early this year, and from the last year—we saw an example of how those appropriations played out with a report from the Manukau Auckland University of Technology: a professor who let us know that the transience—the situation of people having to move and move and move and move is appalling and disgusting for this country. For instance, women in particular are impacted on. Women with children are impacted on. Māori and Pacific women were moving up to seven times in three years from home to home because the previous appropriations have not made a difference in terms of making sure that people can stay put, and that the supply—that investing in enough State housing, especially while we’re in the middle of a homelessness crisis, and making sure that we are building enough homes to meet the demand of what is happening. None of that had happened, and for a long time it hadn’t happened, and, in actual fact, I want to stipulate again, this previous National Government left a shortfall of 71,000 houses nationwide and 45,000 short in Auckland.

But here’s the thing, here’s the rub: that shortfall grew from nearly zero from nearly 10 years ago. So that shortfall continued in the previous appropriations, and the annual review did not make a meaningful impact on that. And what did that look like on the ground—what did that look like on the ground? It looked like people lining up outside of Work and Income in my community, in Manurewa, and elsewhere around the country, and, in Auckland, a young mum with her newborn baby who got into that line at 7 a.m. in the morning in the middle of winter purely to try and get extra for what she needed because of high housing costs that the annual appropriations did not sort out.

What must it take? Can any of us in here relate to what it must take for a young mum with a newborn baby to get up and line up at 7 a.m. in the morning to try and get some help for what she needs? That’s well beyond what—I think it was—Mr Tim Macindoe referred to as “dependency”; that’s us gone wrong, that’s what that is. We didn’t sort that out, and, certainly, the previous annual appropriations did not sort that out at all. So, we’re going to change all of that, because, first and foremost, this is a Government that understands that it is the well-being of our people that will create a strong economy, and those are the appropriations that we are putting in place.

Also, I’m pleased to say, I’m proud to lead, with Minister Phil Twyford, one of the areas where we can improve homeownership, which is with having a rent-to-own or progressive homeownership scheme, which is part of the Greens’ agreement with Labour. I’m proud to say that those are the sorts of appropriations that should be being made. That’s the agenda that we need to see in these annual reviews, and with this Government, it is understanding what is important to get our economy, our societies, and our environment right, and that we put those at the centre rather than surplus at all costs, which is what we saw in the nine years, but especially in the previous annual review of appropriations.

So, I’m proud to stand here today, and, again, lay that commitment in the ground—that this Government is turning the degradation on its head and we will be committed to putting in place the real appropriations that will make that work. Thank you, Madam Chair.

I’m quite pleased actually to bring this discussion back to the appropriations and discuss what’s actually happened, but I can’t resist perhaps giving that member—granted, a list member—some advice on electoral approach, and particularly to do with the Ministry of Social Development (MSD). I would have suggested to that mother, having worked in MSD, actually, to not start queuing at seven in the morning, seeing as the doors probably don’t open until nine—

💬 Marama Davidson: Yeah, that’s how long they had to queue for. My goodness. Come and visit. You’re welcome to come to my community and visit. Come.

—and also to get on the phone, actually, and book an appointment so that she could actually go in. So we’re hearing yelling, of course, from that member because she’s never worked a day in her life in MSD or knows how the processes work but just likes to take someone’s story.

And I completely agree with Tim Macindoe about the culture of dependency which is created, and that’s why the Government, in its appropriations, delivered and discussed in this House, absolutely showed a commitment that hasn’t been discussed here today—actually the millions and millions of dollars that the Government had set aside to increase the incomes of New Zealanders, particularly those reliant on social development funding. That sits, of course, in the background of this being a National Government; the first Government in 42 years to raise benefits. And it’s funny because we always get, from the left and those now in Government, how much they care, but it’s funny that when they are out of power they talk a big game, but when they’re in power nothing really happens. It was a National Government, I remind this House, that was the first in 42 years to raise benefits well beyond the Consumers Price Index.

But, in terms of these appropriations, again we’re hearing from the other side that nothing happened. The family tax package was something that was appropriated—an increase in Working for Families, an increase in the accommodation supplement, an increase in Working for Families—and, really importantly too, an appropriation in the last cycle around emergency housing.

There was lots of, well, sort of waxing lyrical up to the election about homelessness and the terrible crisis. Why I mention that is for two reasons. First and foremost, it was funny how, the day after the election and after many in the media’s leftist mates got in, that all of a sudden the crisis seemed to disappear. Secondly, of course, they’ve all forgotten, actually, the millions and millions of dollars that was appropriated to put in to emergency housing. It was actually the National Government, and in the social development context, that was supporting emergency housing.

I think also important in this area, and I say this as now the associate spokesperson for housing, particularly in social housing, the National Government was a Government that was looking, in its appropriations, to work with the sector to fully support people. See, housing is not simply about a roof to put over one’s head; it’s actually about trying to put in those wraparound supports—one can look at what Barnados, what the Salvation Army, and certainly what the likes of VisionWest Community Trust are doing. So it’s not only supporting them to provide a house to become a home but also the support that is necessary. And we’ve heard, from the other side, that’s it’s once again the simple leftist progressive approach: just throw some money; give people whatever they want without question or consequence. Actually, our appropriations, as we worked them through, were there to support people: to help them around budgeting if they needed further social support and services, to teach them financial literacy, and to help guide there.

We heard from the Hon Nick Smith again about the work that was done around insulation and smoke alarms. Those were elements appropriated as well in 2017-18. I repeat these in the House to refute the allegations that keep being yelled across at us that nothing was done; that the National Government, in the 2017-18 appropriations, did not consider anything. One only needs to look at the insulation increases to all State houses and to smoke alarms to see that.

There’s also been all the talk about the selling of State houses. Personally, I’ve got absolutely no problem with that, and I say that as the member of Parliament for the proud seat of Tāmaki. I look to the areas of Glen Innes and Panmure. In fact, it was a Labour Party decision many years ago, and picked up more recently by National, of transforming that community. For us as a community there in Tāmaki to build these warm, new, dry houses, which the community are loving, we actually have to sell some State houses. You can’t build new houses if you haven’t sold off some of the old ones. So it’s an easy rhetorical flourish from the other side to say it’s terrible to have sold them but, actually, in selling some State houses it has provided us, including through these appropriations, the opportunity to build those amazing new, warm, dry homes. I encourage—I’ll say “most of”—the members on the other side to come to Tāmaki to check out these amazing new homes. I say only “most of” because I suspect some who may be speaking after this will already be well experienced in the amazing work of the Tāmaki Redevelopment Company.

Madam Chair, thank you for this opportunity to speak on the annual review of Housing New Zealand, and I’ll also cover social development as well, but I’ll begin with Housing New Zealand.

Housing New Zealand Corporation in 2016-2017 recorded a surplus of $65 million, and in the year prior to that, in 2015-2016, it was $134 million. But when you look at this appropriations report a little bit later, what they cover is payment of dividend. Now, one of the things that the previous Government did, and I quote, “Under the Housing Corporation Act the corporation is required to pay its annual surplus to the Crown unless”—and I must emphasise that word: unless—“the responsible Ministers authorise otherwise.”

Now, we know that over the last nine years when the previous National Government was in Government for most of those years, Housing New Zealand Corporation was required to find a surplus, and this surplus was paid back into the Government’s coffers. We know that for a whole lot of our State houses, utilising some of that money—as Housing New Zealand Corporation is right now—to ensure that the houses are well maintained and that they are warm dry and healthy, was not done. I’m happy to say, though, that that is what is currently being done now under this current Government.

I have to reflect on both the previous speaker and the former Minister of housing, Nick Smith, who spoke about how he was proud of the previous National Government’s record on housing. Can I say that when you have record homelessness, when we know that Aotearoa New Zealand has the worst rate of homelessness now, and when we are No. 1 for homelessness when compared to the other OECD countries, I would not be proud of that particular record. That is a record that none of us should be proud of: the fact that we are short by 71,000 houses across all of New Zealand; the fact that in Auckland, our largest city, we are short by 45,000 houses; and the fact that we know there are still so many of our families that do not have a roof over their heads.

Can I go back and reflect on 2016-2017. One of the things that I as a local member of Parliament and many other colleagues from this side of the House tried to ensure that the Government at that time was aware of was the fact that we actually had a housing crisis. This was something that we acknowledged when we were in Opposition, and it is something that we still know today as a fact, which is one of the reasons why we’re saying that we will do this KiwiBuild. One of the things that the former housing Minister was talking about was the fact that we would only be building several thousand homes. The Hon Nick Smith didn’t then say that the thousand homes that the housing Minister is talking about is 1,000 KiwiBuild homes. That is not counting the houses that Housing New Zealand Corporation is building. That is not counting the houses that private developers are building right now, only the KiwiBuild homes, and the year after that it’ll be 5,000 KiwiBuild affordable homes, and in the third year 10,000 KiwiBuild affordable homes.

But can I go back to the fact that we have a housing issue that we are addressing. After nine years of the previous Government, we have been landed with so many issues. Housing is one of them; homelessness and the fact that we are having to—one of the points that my honourable colleague who has given a speech also mentioned was the fact that we are now no longer selling off State houses and that we should look at Glen Innes, and Glen Innes is a good example. The same time that the previous Government was selling off the State houses was the time that they were also investing in motels.

Now, when we look at the social development part of this annual review we see that the demand, in terms of social housing, exceeds supply in many communities. We also see, covered in there, transitional housing. Now, the fact that in 2016-2017 we had to invest in so many emergency houses and transitional houses was because we were not catering for the numbers of houses that our people need, because the previous Government was selling off State houses.

Kia ora, Madam Chair. Thank you very much. It’s an honour to speak in the annual review debate. I’d just like to actually speak about Vote Vulnerable Children, Oranga Tamariki. I want to acknowledge the Hon Anne Tolley. I want to acknowledge the Budget bid that she obviously put in and managed to fight for inside the Cabinet that she sat in at the time that she created Oranga Tamariki, which we all know has just celebrated its first birthday.

Around about $50-something million was set aside for Oranga Tamariki and its creation in the last financial year. We need to acknowledge the fact that the expert advisory panel said that for the creation of this new department to truly deliver what is needed to be delivered, the change that needs to take place, the transition that needs to take place, the extension of the age that was passed in legislation during the same financial year so that all young people under the age of 18 would still be part of Oranga Tamariki’s care and observation that was with the lifting of the youth justice age—this organisation would need $500-plus million to do what it needed to do. It has to be acknowledged: I have no doubt the Hon Anne Tolley went inside that caucus and fought for the money that the expert advisory panel said was going to be needed to be delivered to change the operations that actually deny some of our children in most need, which was $500 million, but she was able to get secure 50—I think $54 million.

So, that’s $54 million. Well done her. It was obviously a hard fight. But it was woefully short of what was needed. And this was the previous Government in the previous Estimates saying that they were doing so much to protect these children. The vision was a good vision. The pillars that were set into place under Anne Tolley were good pillars. Unfortunately, the funding was not there to deliver on the operating model that needs to be placed around this organisation. The funding was never secure. There was no contingency. There was no forward planning. There was no decision made when this idea, when this vision, was put down on paper about how it would be funded by the previous administration. So that’s unfortunate.

But what Oranga Tamariki has done in the year that it’s been in existence with the money that was secured under the previous financial year is that they have begun that transition. This Government will have to take many major decisions over the next six-month period. We will have to find the money that the previous Government did not set aside so that we can ensure that New Zealand becomes a place where when the State has to support families, when the State has to uplift and take care of children, that we are able to provide both those children and their families with the best possible outcomes for them and their circumstances.

We also need to make sure that those that are caring for these children are well supported, and that has been failing in previous administrations. We need to make sure that our youth justice facilities are trying different things so that we don’t have a churn through our youth justice facilities as we had before. The money that was set aside in this last financial year, unfortunately, went no way towards making sure that we could make those changes that we needed.

But again, just in closing, I want to acknowledge that Anne Tolley, in my view, obviously went into her Cabinet and fought as hard as she could to get the money that she could in the previous financial year. There were some hard decisions made. She made them. She started to make that circuit breaker that we needed, and with the small amount of money that she had and that the organisation had, they have moved forward. There are some things that we need to be proud of, but going forward, there will need to be certainly a lot more focus around the finances and the resourcing that will be needed for these children. Kia ora.

I just want to say to the previous speaker, Tracey Martin, that we’re pleased that the Government is carrying on with Oranga Tamariki. It’s an amazing project. It’s an amazing policy, and so many things over the last 12 months have had to happen to actually set Oranga Tamariki up in a way that it could move forward. So I say thank you to that Minister.

I want to talk a little bit around the social development side. On this side, we view welfare and benefits as something that should be able to help people when they are in times of need. That’s what this side of the House sees. We don’t see it as something that should be of a right, but we see it as something that should help people when they are in need, to actually help them to get to the next place, to get them back on their feet again and to move forward in their lives. This side of the House isn’t about telling people what they want. It’s about listening to people on their needs, and many of the things that we have done in 2016-2017 have been about that.

Social development is a huge portfolio. It deals with everyday people’s lives—people that really desperately need that help. One of my whanaunga who was an ex-Minister of this House, the Hon Sir Apirana Ngata, once said that when welfare was being discussed in the House in those times, he didn’t really support it. He felt that welfare would be the ruination of our Māori people, and maybe in some aspects it has been. But, in saying that, I just want to say that we understand on this side that there are times and places where people need help, and that’s what this side of the House was about when it came to social development.

Just some key facts around the 2016-17 period: unemployment to the September quarter was 4.6 percent. That was the lowest unemployment rate since the global financial crisis in December 2008. That’s amazing considering all of the issues that New Zealand faced from 2008—made of other people’s makings, but we had to actually bear it. So to get the unemployment figure down to 4.6 percent was an amazing feat of this side of the House as we led Government. Some of the things around hardship: the number of kids in material hardship had fallen to nearly 40 percent since the global financial crisis, to 135,000 in 2016. The Ministry of Social Development reports no evidence of any rise or fall of household income inequality over those last two decades.

💬 Welfare: nearly 60,000 fewer people were on job seeker benefits than in 2010, over the period—

💬 Hon Scott Simpson: How many?

Sixty thousand fewer people on job seeker benefits than in 2010. The number of people on sole parent benefits: the lowest data collected was 27 percent lower than 2008.

💬 Hon Scott Simpson: Hugely impressive.

It was, because a number—and I met a number of those sole parents that had come off the benefit and were making their way in the working world. It’s not easy when you have to move off something that has been regular in your life, and I get that. I get how hard it is for sole parents. I was a sole parent, so I know how hard it is to actually cut loose and make it on your own and go out and get work and do all of those things while still bringing up a child. So I get it, and I got what those young women were telling me.

There were 57 percent fewer teen parents on a benefit than in 2009. That’s really good, because to be a teen parent is very difficult in today’s society. It’s difficult anyway, but in the pressures that young people face today, teen parenting isn’t exactly where they should be at. They should be in education; they should be moving towards getting their career sorted and not having to worry about having to raise a child when they are a child themselves.

So the number of benefit recipients per thousand population has been the lowest since 1988, and this side of the House is very proud of all of those particular statistics. I could go on and on and on, but I won’t.

Tēnā koe, Madam Chair, and thank you for the opportunity. The member who just resumed her seat, Joanne Hayes, spoke of one of the famed fathers of the House here, Sir Apirana Ngata, and, actually, what he meant in his deliberation around the dependency of our people was actually an attempt to address the inequities that Māori people were suffering at the time. One only need read the book called The Price of Citizenship to see that, actually, while they didn’t want Māori to fall into dependency, all they wanted was for them to get what they deserve—simply, addressing the social inequities that plagued Māori people in his time and, in the annual reviews, continue to plague Māori people today.

I want to touch on some of the points that that speaker raised, in particular around unemployment. I want to highlight that in the time of the former Government, in the past year, Māori unemployment has sat stubbornly at double digits. In fact, the last time it was in single digits was under the stewardship of the great Parekura Horomia, who we remembered just not too long ago, and the Labour Government under the Clark regime. It saw Māori unemployment in single digits. Under the last regime, and in particular in the last year, Māori unemployment has sat stubbornly at double digits. In fact, it sits around 11.8 percent.

But I also want to highlight, as the Minister for Youth—I want to acknowledge that also in the category of unemployment are, of course, “neets”. I hate using that term, because, as we travel in and around the country, they don’t want to be called “neets”. They’re young people who have unlimited potential and aspirations for themselves, and the label “neets” really is a bureaucratic term that I hope that outside of this House we don’t use too often.

But let’s rattle through some of those numbers. The talk was about making sure that we bring unemployment numbers down and benefit dependency down, but let’s face it: more young Māori and Pacific peoples have been affected. In fact, Māori are 19.5 percent unemployed “neets”, Pacific peoples a close 17 percent, Asian 10.4 percent, European 10.2 percent, and the average is 12.1 percent. Over the past year, despite the rhetoric and the claims to have addressed the issue of youth unemployment, or “neets”—those who aren’t in employment, education, or training—nothing has been done. In fact, the number of “neets” increased over the past year by approximately 4,000—4,000.

So while the previous Government might talk about how we’ve reduced benefit numbers by thousands and we’ve seen people walking out the doors with their pride and aspirations to go on and live meaningful lives, the fact remains that there has been an increase over the past year of 4,000 “neets”—4,000. That’s a heck of a lot of young people who aren’t in employment, education, or training and continue to receive assistance from the Government. So despite the claims from the other side of the House of how well they’ve done, there is still a significant issue there.

But just to bring it into today’s context, I am excited to be a part of a Government that are going to address these. We’ve got some policies coming up, and I’m looking forward to seeing them roll out across the country.

Just in the brief time I have left, housing is of course one of those big issues. We know that for social prosperity, for economic prosperity, for educational prosperity, and for prosperity in general for families, it all centres around a rock, and that rock is, of course, a family home. My colleague the Hon Jenny Salesa talked about the great dividend that was achieved by Housing New Zealand in the discretion of the Minister about what happens with that particular money. Well, what’s clear in the annual reviews is, of course, that money was spent on hotels and motels—hotels and motels to house our people, the most vulnerable, who, in trying to address the issues that they face, we’re saying a house is one of those crucial steps to make sure that you can achieve your aspirations.

So what’s happened in the past year? The Government purchased motels and hotels. That’s a shame, because if we are true about trying to meet the aspirations for our families, for our young people who are just looking for opportunities out there, putting them in hotels and motels isn’t the answer. It says here that 12 weeks is the average stay of a family in a hotel or motel. Well, that’s 12 weeks far too long. In fact, I know of many cases that have been well over 12 weeks—in fact, rolling into six months and even longer—and that’s not good enough. But don’t worry; this Government has a plan.

Thank you, Madam Chair.

CHAIRPERSON (Poto Williams): Excuse me—sorry to interrupt the member. Just before I ask you to resume, you are going to speak on this particular sector? I’m just wanting to make that clear.

Yes, Madam Chair. I’ll be careful to make sure that my words are directed there.

CHAIRPERSON (Poto Williams): Thank you.

In fact, I just talked about, as a new member going through the first year of all the milestones, that it was actually a great pleasure to sit through these and examine the Government departments, the various very hard-working public servants that came through. As I did so and heard people who were essentially answering questions—and I’m reminded of what I’ve heard today here in the House from my colleagues—I sort of almost thought I’m living in somewhat of a parallel existence. You know, the people over there, they’re good people and I hang on their every word. I’m sure they believe everything they have said today, and if you sat there to listen, you would think we do live in paradise, that we do live in a rock star economy. So my previous training just makes me think perhaps we should look a little through that.

The reason they do believe that is that there was only one goal from that previous Government. The rock star economy—unfortunately, it’s fine to have a concert where the rock star’s paying, but if no one can afford a ticket to the concert or no one is welcome, then it’s going to be a pretty small, sad, elite concert. And I think that’s what has actually happened—goals where we talked about things like Better Public Services (BPS). Well, my experience of Better Public Services was simply cheaper public services, and while we did speak to the chief executives, while we did speak to the various public servants that came through, one of the questions that very much came through from those on the other side of the table was to ask about Better Public Services, about targets.

The general theme of the questioning was that nothing will happen without these very strict stipulated targets—the whole world would stop. As we sort of asked those questions of the various public servants that came through, there was something of a look that came on their faces—a look of “Are we allowed to tell the truth here?” When we did dig down further, clearly there was a belief that those Better Public Services, by breaking down everything that the Public Service does into something measurable—something we can feed back, something we can all feel good about, something we can believe where we’ve achieved that little target and therefore the world is a wonderful place—it was quite clear that the achieving of those Better Public Services targets became the end in itself.

As I sat there listening to those fine members on the other side, they do believe that by looking at what the targets achieve, then it must be all good; we must be in the state of nirvana. Unfortunately, I then sit and look at the figures that have come through. I won’t go through them all, because they’ve been spoken about several times today. But can they believe that we’re not short of houses, that we aren’t 71,000 short? Well, we are 71,000 short. The Hon Nick Smith talked about how wonderful the figures were. Well, again, if you sat back and listened to those figures, you’d say, “What am I worried about? I might as well go and have an early tea now because things are fine. We’ll leave it to the Opposition to run this because we don’t need a change of Government.”

However, it became apparent, as the various departments came through—and I talk about housing; I talk about those who came through from the Ministry of Social Development, the Ministry for Vulnerable Children, Oranga Tamariki—as we questioned further down and saw a release from the strict BPS targets, that there was the realisation that this Government is going to require outcomes. It’s not going to be, as a friend of mine who started a business believed, that if he just worked really hard it wouldn’t matter; the hard work in itself would result in success. Well, it didn’t. You have to be clever about what you’re doing, and BPS weren’t clever.

I know, in my own department that I was working in before I came here, that by what they did, by focusing on things that the Minister wanted and ignoring the important things, then we have a result. For example, in police, the methamphetamine and gang problem is a direct result today of not actually allowing those who knew what they were doing to actually do what needed doing but to give them fine and specific targets. So, again, as I sat listening as part of the whole appropriations, I am confident that next year you’ll see a range of public servants coming through empowered and confident that it’s the result that matters.

Madam Chair, thank you very much for the opportunity to take a call on this, the appropriation for social development and housing. What a year 2016-17 was. I was leading the housing portfolio for the Wellington City Council, which included social development also, so can I say it’s a wonderful opportunity to reflect on the experience on behalf of ratepayers, taxpayers, and everyone else that these guys, the Opposition, served on the New Zealand public, from a Wellington perspective at least.

I want to focus on the Better Public Services targets. It’s been talked about. It was result area No. 8, and it talked about better access to social housing. I guess this was the start of where things went horribly wrong. If you look at what was the previous Government, they didn’t have a housing Minister for a long time. Instead, it was split over three portfolios, and that sort of reflected on their narrow, just dismissive approach to housing in general. Can I say, having to deal with the then Government from the other side as a key stakeholder in the process, it was tough stuff. We, then the Wellington City Council, wanted to have a housing conversation about the full continuum: housing supply, and I’m going to focus on that today; homelessness; social housing; cold, damp homes; and homeownership. When we tried to have such conversations we were regularly referred to the Better Public Services document. But, as I said, it only talked about better access to social housing.

To cut through all the waffle in that document, as a lot of it was, the reality really for social housing was to set up—and we heard a member of the Opposition talk about it—to transfer or to give away, really, the stock to other people. We saw then how the Salvation Army, the then Salvation Army, said, “No thanks, not us. Don’t quote us in the media. We’re not interested.” So there was this sort of quasi - Crown council operation set up, the Tāmaki Redevelopment Company, but really it was just a halfway house for transferring most of the social housing in that part of Auckland to an entity that would undermine, in fact, the Housing New Zealand Corporation, the Government’s own property company, because it had become that. I say that, as a property company, because they had taken the people focus out of that business and transferred it to the Ministry of Social Development. What a mess. I mean, I’d never been confronted with such a messy, dismissive, and just an unappreciated part of a core Government business, and that is the provision of housing.

Look, the stats are there around housing supply, and they talk about the need for 71,000 houses. Interestingly enough, nine to 10 years ago, the need for houses was sitting at nil, but what do you know? Ten years on, and from a Wellington perspective, it sat at about 6,000 homes; 4,500 of those being social housing, a portion of that being for temporary and emergency housing. But, none the less, the only mechanism during 2016-17 that could be brought fought for consideration was the HASHA Act, the Housing Accords and Special Housing Areas legislation that was meant to bring more supply. It was developed for Auckland and really imposed on local government throughout New Zealand, because if you didn’t pick it up and you didn’t take it on board, you were given the cold shoulder. That’s how it felt when we had to retrospectively approve a housing accord that had no percentages in for affordable housing. When you actually unpick what the special housing area legislation is all about, you’ll find that very few houses were actually built.

I could speak for hours on this, but I won’t. What I will say is that I’m really glad that we’ve got a whole raft of new home building happening across Aotearoa, New Zealand. Thank you, Madam Chair.

Reports relevant to the Social Development and Housing Sector noted.

Clauses 1 to 9 and Schedules 1 to 5 agreed to.

House resumed.

Bill reported without amendment.

Report adopted.