COVID-19 Response (Management Measures) Legislation Bill

We now come to clause 3. This is the debate on the amendments to enactments and includes the debate on Schedules 1 through to 8. The question is that clause 3 stand part.

Point of order. Sorry, Mr Chair, when you were—I’m struggling how to phrase this without breaching the Standing Orders. The House has already resolved, I think, via consensus that we will move through the clause 3 schedules—which is, let’s face it, the substantive part of the bill—schedule by schedule, if that makes sense. So Schedule 1 is in relation to the Department of Internal Affairs amendments. Part 1 is the Gambling Act, so I think it would be helpful to deal with the Gambling Act amendments and then, potentially, move after that to the Local Electoral Act, and then so forth. We’ve sort of agreed on that, I think.

Speaking to that point of order, it was agreed that the order of debate would run through those schedules so that Ministers and their officials could be most efficiently used. But there wasn’t, I don’t think, an agreement that each schedule would be taken as a separate clause.

Speaking to the point of order, Mr Chair, perhaps I can assist. I actually sought leave while the previous presiding officer was in the Chair for precisely the course of action that we would debate each schedule in turn. The presiding officer didn’t put the leave, saying that that was already her ruling, so we’ve all been working under the understanding that, indeed, we would separately debate each of the schedules, given that those are, effectively, for want of a better term, the parts of this particular piece of legislation. I would have insisted that the previous presiding officer put the leave had I not understood that she was saying she agreed with that course of action.

I want to thank all members for their contribution to this issue. I was fully aware of the ruling of the Hon Jacqui Dean. My understanding of what I heard was that we will go through clause 3 and the schedules. For the purpose of efficiency, we’ll deal with one schedule at a time, which I think would be, as I say, an efficient way of doing it, but there’ll be just one question at the end, passing all of clause 3 and the schedules. To do anything else would be contrary to the Standing Orders, and I think would have needed an instruction to the committee when we were still in the House. So if we can proceed as such, then we will go to Schedule 1.

Thank you very much, Mr Chair. Now, something very interesting has happened between the introduction of this bill and the select committee and the committee of the whole House, because as the bill was introduced, the Government sought an amendment, as part of this omnibus bill, to the Local Electoral Act, to replace section 73A(2) of the Local Electoral Act 2001 and, essentially, give the Government, give themselves, the power to move local elections; not just once, as is the current law—and it’s going to remain the current law; just giving the game away—but they sought the power to move local elections out by six weeks, over and over and over again; not just in the year of the local body election that we’re talking about but for the year after the local body election as well.

So, for all those listening, just so you know, the Government turned up with this omnibus bill and it’s got about 20 different amendments to different pieces of legislation. Most of it’s rats and mice. Most of it’s sensible. I haven’t even bothered to dwell on the Gambling Act amendment, which allows various people to operate under level 2 and 3 lockdown restrictions—I haven’t dealt with that. But 20 pieces of legislation amended, an omnibus legislation, sent to the select committee with a shortened report-back time, this omnibus bill, and the Government just quietly thought that they would get away with the secret—or not secret but quiet little change, secretive little change—

💬 Hon Member: Clandestine.

—clandestine—clandestine; great Julia Deans song, great word—this clandestine little change to allow themselves the power to delay local body elections. And I’m pleased to say that the National Party was on to this. I’d like to take the credit for it myself, but it was actually Chris Penk, the shadow Attorney-General—sadly, in Auckland, so he can’t be with us, but he’s taking victory in absentia. He’s taking vicarious victory, because he cottoned on to this. And I remember he sent me a text. He said, “Have you got any idea what the Government’s chucked in this little bill?” I said, “Oh, no, I don’t yet. I’m just looking at it now.” He said, “They want the power to delay local elections, over and over and over again.” It’s just unbelievable. And I remember standing in this very position in the first reading of the bill, saying, “What is the rationale for this?” And I said, “We’re going to want to get into this in committee.” And that’s exactly what we did.

The Finance Committee, I’m pleased to say—very sensible members—got into this issue at the committee and said, “What is the rationale?” And the funny thing was, as it turns out, there isn’t one. I mean, there was this sort of confected concern about, you know, it might be very tricky to run an election under level 3 lockdown restrictions. I mean, that’s true up to a certain point, obviously, although let’s bear in mind local elections are postal votes; they are not, you know, go down and vote in person. Personally, I would like to bring voting in person back for local elections, but that’s beside the point.

But anyway, the good news, the excellent news, is the Government has, quietly, just backed down on this. Supplementary Order Paper (SOP) 78 makes it very clear. By the way, SOP 78 is actually, I think, longer than the bill. So it’s a pretty poor process. And the Minister in the chair before was saying things like, “Oh, well, we’ve already made that change.” Actually, we haven’t, because the select committee bill that came back—because of the shortened report-back time, the select committee didn’t send back the bar 2 bill; it sent back the bar 1. So it’s un-amended at present; we’re making the amendments as we go, through this giant SOP—very poor process. But here we are, that’s the way we work.

But if you read SOP 78, Part 2, “Local Electoral Act 2001”, there we see the lines through every single paragraph and every single word. It’s all gone. So the Government has given up. They’ve given up on this secretive, clandestine little change, and I welcome that. But I have a question; in fact, I have two questions for the Minister in the chair. The first is—and bear in mind, we welcome the change—we need to know, I think it’s worth the committee’s time finding out, why the Government wanted to make this change. And then, secondly—and it’s related to the first question—why has the Government decided to not make the change? Because, for a period of weeks, it was critical, and now it turns out it isn’t. I suspect the reason is the Government’s decided that they’re in a big enough war with the local government sector already, with 60-odd councils opposing the misguided Three Waters reform process. I strongly suspect they’ve decided, “Well, let’s not add fuel to the already burning conflagration that is the Government’s relationship with the local government sector.” So that’s why they’ve quietly beaten a retreat, and we welcome that. But we need to know exactly how this happened in the first place. We welcome the Minister’s contribution to that.

I’m very happy to answer the question put by the member, which was why this provision was made in the bill in the first place—why the provisions around local government elections were made in the first place and why they’ve been taken out.

This bill, of course, has been in the works for several months now, and when the bill was put together, we were in quite a different situation when it came to COVID-19, and we were preparing for that situation to potentially continue into the new year. It is now clear that it won’t and that we are entering a new phase of our COVID-19 response. Under our old settings, a delay in local government elections—as there was a delay in the general election last year—would have potentially been something that the Government may have had to consider; it now isn’t likely that we would have to do that. So the Government took the view that in the highly unlikely event there was a need to postpone or delay the local government elections because of COVID-19, the appropriate course of action would be to come back to the House at that point and produce a separate piece of legislation to enable that to happen.

So the Government took the view that while this may have been justified several months ago, potentially, it’s not now and is unlikely to be justified next year. And if it is justified next year, then the appropriate course of action at that time is to come back to the House to seek that.

Point of order, Mr Chair. I understand that there has been some debate about the way the debate on the schedules should be undertaken in the committee. So I thought it would be useful to share the agreement that was reached at the Business Committee by all parties who were at the Business Committee. Parties were invited to nominate which parts of the bill they wished to have Ministers available to answer questions on. The only response was from the National Opposition, from Mr Woodhouse, who indicated that they would like to debate the local government provisions, as has happened; the residential tenancies; and the commercial law provisions. No response was received from other parties.

So, on that basis, we have made sure those Ministers who have responsibility for those provisions are available here in the House. In terms of the local government provisions, the Minister of Local Government is not available, so I am here to answer the question, which was pretty much the only question that they’ve really asked about, which was why has it been deleted, which I have now done.

And, finally, I should say, if the agreement reached at the Business Committee is one that parties in the House no longer wish to sign up to, then the default is the Standing Orders, which is all provisions, all schedules, are taken as one question and one debate, up to the point where the Chair accepts a closure motion.

💬 Chris Bishop: Speaking to the point of order. Thank you. Thanks to the Leader of the House and “Acting Minister of Local Government” for that elucidation. I think it would’ve been helpful if that was made clear to members at the start of the committee stage debate by either a presiding officer or a senior Government member; that was not at all clear.

So, look, I suppose the situation is we find ourselves where we find ourselves, and we’re now getting well into the substance of the bill. We have the appropriate Ministers here, so I suggest we proceed on that basis.

💬 David Seymour: Speaking to the point of order.

CHAIRPERSON (Adrian Rurawhe): I think we’ll proceed as we earlier discussed. My understanding is that there was a discussion but no agreement at Business Committee, and the Minister the Hon Chris Hipkins is correct. So we will proceed according to the Standing Orders. However, as I indicated earlier, for the purpose of efficiency, the committee seems to be of a mind to go through each schedule one by one. I think that’s still OK.

💬 David Seymour: Point of order, Mr Chair. Could I just note what the Leader of the House has just said, that the Government can introduce laws to Parliament, try to pass them through, and Ministers only have to show up and answer for them if the Opposition specifically asks them to. The onus has never been on the Opposition to make sure Ministers show up and be accountable.

CHAIRPERSON (Adrian Rurawhe): I can rule on that. The Minister in charge of this bill is the Hon Chris Hipkins; in actual fact he is the only one, or someone in his place, that needs to be here. My understanding was that the offer was made because of the broad nature of the issues covered within the schedules that other Ministers would be available to respond to members’ questions relating to those schedules. In actual fact, we can only have one Minister in the chair. As the Hon Chris Hipkins is that member, he is the Minister in the chair right now.

💬 David Seymour: Speaking to that, Mr Chair.

CHAIRPERSON (Adrian Rurawhe): No—

💬 David Seymour: I take your point but we don’t normally amend 15 laws at once.

No, no—you’re not speaking to that. I’ve made the ruling, and the Standing Orders are very clear: if you have a contribution to clause 3—

💬 David Seymour: Yeah, absolutely.

CHAIRPERSON (Adrian Rurawhe): —then I’ll absolutely hear it.

Thank you, Mr Chair. I just make the point, for people who may be listening, that this is a bill that’s amending 15 different laws at once. That’s quite extraordinary. That’s why you might actually expect Ministers to show up.

💬 Hon James Shaw: It happens all the time—they’re called omnibus bills.

And James Shaw from the Green Party says, “Oh, no, it happens all the time.” Well, that shows the Green Party’s commitment to democratic lawmaking and accountability to the people. It’s sometimes helpful—

💬 Hon James Shaw: Have you never met an omnibus bill before?

I sometimes—and he says, “Have you never met an omnibus bill before?” He joys in rapidly and unaccountably passing laws. He thinks it’s a good thing. Sometimes it’s helpful to be able to read these off-the-ball comments by people like James Shaw into the Hansard.

But I was just saying, in relation to clause 3, and particularly following up on the comments of Chris Bishop, relating to the Local Electoral Act section, and the subsequent deletion or proposed deletion under the amendments on Supplementary Order Paper 78, and people can see there that what we’ve got is a piece of zebra legislation. It’s got so many stripes on it where they’ve struck out every word, because they’re deleting everything they said. There are horses in striped pyjamas running across the page, there’s so many stripes—it’s a zebra amendment. They’re deleting everything that was there before, and it raises the question that—and there’s Megan Woods, she’s chortling away. She loves a good zebra, and she knows that there’s something very wrong with this legislation.

The question that needs to be asked here is—and Chris Bishop asked it—why did the Government think it appropriate to reserve itself the power to indefinitely put back local government elections? Why, in the first instance, did it think that was necessary? And why has it now said that it doesn’t want to be able to delay, indefinitely, local government elections at a whim? Why? And the answer to that, Chris Hipkins, the Minister for COVID-19 Response just gave, well, he said that because the Government thought before that COVID would be much worse. Well, that’s the most extraordinary admission. It sounds as though what he was trying to say is, actually, that he thought maybe New Zealand would be locked down well into next year. We don’t have any local body elections scheduled until well into next year—next October, if I remember correctly. Is that really what the Government thought? And he says now everything’s better, we’re transitioning out. And I don’t know if what he’s trying to say is that the Government’s abandonment of the elimination strategy means that because we’re no longer using lockdowns and an approach of trying to achieve zero COVID in a Delta environment, he thinks, well, everything else is going to be going on, maybe local body elections can too. But if that’s what the Minister’s saying—that he seriously thought until a month ago that he was going to lockdown all of New Zealand for a year, and therefore we wouldn’t be able to have local body elections and might need to delay them next October—that is the most extraordinary admission.

But here’s another question: even if that were the case, I don’t think the answer holds water, even if that extraordinary admission was true, because what the Minister appears to be saying is that it would be impossible to have an election, to have democracy under any kind of COVID alert level restrictions. Now, remember, this is the same Minister who routinely gets up in the House and says that it’s quite possible to have a Parliament hosted over Zoom. He thinks it’s possible to have a Parliament over Zoom, but he doesn’t think it’s possible to have a postal ballot, a local body election—that can’t take place over Zoom. And you have to wonder why that is. Maybe he’s worried about the mail processing, the postage, but this is the same Minister that even under alert level 3 and even under alert level 4 conditions—the conditions that he seems to think might have gone all the way through to October—he’s trying to say that we couldn’t have had a postal ballot. But look at what alert level 4 allows. You can order all manner of things. You can order beer to be delivered at your apartment. So what he’s saying is that he thought it would be OK that alert level 4 or 3 were going to go through to next October, and that you’d still be able to order beer to your apartment but you wouldn’t be able to vote by post for your local council. None of that holds water, and I think we really need to get to the truth of why the Government wanted to do this and why it now doesn’t.

I stand on the presumption that we are able to speak on clause 3, which is Schedules 1 through 8. I’d like to speak directly to changes to the Residential Tenancies Act (RTA), as noted in Schedule 5, and just talk a little bit about the reason that we are here in this debate tonight.

Firstly, can I mihi to all of our colleagues, our whānau and friends, in Auckland and the Waikato, knowing that you are doing the hard mahi for all of us, that it is particularly difficult for you considering the lockdown level that you’re experiencing at this time, and my gratitude to you all for the work that you’re doing.

The changes that I’m signalling under Schedule 5 to the RTA have come about because of the experience that we had during the last major lockdown that we had, where the whole country was locked down and the experience of those people who were transitioning out of their rental residential properties and were unable to do so because of the public health restrictions that were imposed under level 3. What I’m proposing is the ability for tenancies to be put on hold when the country is at an alert level 4, which means that those people who are required to stay in place because of the public health order can do so, knowing that at the end of the alert level 4, when it drops down to level 3 or lower, that the period of their termination notice is then topped up by 28 days, which allows them the opportunity to seek to view and to move into a property should they need to.

Also, part of the changes we are seeking to make make it possible that tenancies that need to be terminated, particularly for antisocial behaviour, can continue to occur, and, in the case of boarding houses, that the usual period for notification and the application of that termination has been reduced to 48 hours. Those people who are in a residential tenancy agreement who are wanting to continue with their termination are able to do so. They do not need the 28-day top-up if that’s not required, if they’re able to move into their property on the resumption of alert level 3 or lower. The COVID termination order is able to be turned on or off by the Minister and the notification for the order coming to an end is given within seven days of that order finishing.

The other aspect of this is the changes to Schedule 5 also include the ability for the Tenancy Tribunal to continue to conduct hearings on the papers for 12 months after the bill is enacted. When we were first discussing the changes to the RTA, we were actually in the process of transitioning from level 4 to level 3. So the application for this particular part of the COVID measures will become apparent should the country go into alert level 4 again, and it is a mechanism that is a backstop for future process, should that be needed to go in place. So while it is currently not applicable—Heaven forbid we have to enact it—it may be available for those who need it in the future. It’s one of the things that we put into place during the last time we made some emergency measures. This time it was slightly different from the last iteration, and we’re hopeful that we don’t have to use it, but it’s a provision that’s in place should we need to.

Along with the other measures that this Government is taking, it’s clear that COVID has thrown up some interesting scenarios for us, and as a Government we have to be responsive to those—responsive at the time that they occur, but also anticipating what may occur into the future. Thank you, Mr Chair.

Tēnā koe, Mr Chair—tēnā koe, thank you. It’s my first speech in this particular debate, and I am particularly pleased because I wanted to thank the Minister for her contribution, and I also wanted to speak to my Supplementary Order Paper (SOP) which directly amends Schedule 5.

So, firstly, I just want to say that the Green Party is broadly supportive of the bill and that it’s been quite tiresome to listen to David Seymour’s stand-up comedy act this evening, as well as all the conspiracy theories about local elections. I think that if those parties to my right actually cared about local democracy and democracy, they would be supporting a further SOP from my colleague Golriz Ghahraman, SOP 69, which, of course, would ensure that those—

💬 Hon Member: We are supporting it.

Oh great, well that’s good. Great. Glad that you’re supporting it.

💬 Hon Member: Maybe be a bit gracious.

I don’t know if the National Party is, but that’s good. It’s good, if you care about overseas voters having their right to vote extended when they haven’t been able to come home to New Zealand.

But back to Schedule 5 and the changes to the Residential Tenancies Act. We’re supportive of the direction and the intention of what the Minister has outlined, but we do think it should go further, and that’s why we’ve proposed an amendment that would also enable a rent freeze, so there could be no increase on rents while we’re in a situation of alert level 3 or 4, which was the case last year, in 2020. We think this is particularly important as there’s been such an extended period of time that Aucklanders have been in level 3 and level 4 and that those people who are the most vulnerable and who are renting are seriously struggling, particularly if they have relied on a benefit or if they have precarious or insecure work—if they weren’t on a full-time work contract they might not be eligible for the amount of wage subsidy that the Government is expecting will flow through and assist people in those difficult circumstances.

It’s pretty difficult to justify why landlords should be able to continue to put up rent if, during a period like this when, clearly, people don’t have the ability to find a new place to live; they don’t have the ability to go out and change where they’re living, necessarily, it’s definitely restricted; and their ability to earn an income is very much restricted. Of course, we have seen, in some parts of the country, quite extreme increases in rent over the past year. This is despite record-low interest rates. Yes, house prices have been rising, but that’s not necessarily a reason for rents to go up. It’s really important that we look after those who are in a situation of renting, because, I think, they are the people who are the worst off, really, in this whole pandemic. It’s the owners of property have done very, very well out of the stimulus that has led to huge increases in property values. The Government has put out a reasonable amount of financial support for businesses, as well as workers, and, of course, we think that financial support could go further for beneficiaries, in particular, or for those who are in those difficult circumstances. But the bare minimum, we think, of what could be done is just to ensure that a rental freeze would apply during a level 3 and level 4 lockdown.

I’m sorry, I just want to make sure that the Minister in the chair is the Hon Chris Hipkins, or—I mean, we’re in an unusual situation because we can only have one, because if the Hon Kris Faafoi is now the Minister in the chair, then he will take precedence in getting the call. That’s what I’m saying.

I’m happy to take a call in reference to Schedule 6 in clause 3, a schedule which has been much talked about already in the first two-clause debate of this evening.

In this contribution, I want to begin by acknowledging Auckland and parts of the Waikato who are still finding themselves in alert level 3, and the businesses, especially, that are finding themselves in difficulty with the inability to access their premises in order to carry out their normal business. Can I acknowledge my own colleagues who have expressed to me the difficulty that their constituent businesses are feeling with the inability to access those properties, especially those in Auckland—the likes of Helen White, our list MP based in Auckland Central; Carmel Sepuloni in West Auckland. A number of our colleagues have been in touch to ensure that we give support and continued support and more support to those businesses who are finding themselves in a tussle or in a situation with their landlord where they can’t get any relief.

There has been a lot of talk already tonight about certainty and there is a dearth of certainty for some of those small businesses in Auckland, especially those who haven’t found their way to come to an arrangement with their landlord. I want to also acknowledge those landlords who have done the right thing by working with their tenants to make sure that they can find some form of rental relief, and the conversations that the Government has had would lead me to suggest that that is a large majority of landlords who have done that, and I do want to acknowledge them. A lot of them have either foregone rents, given rent relief, and, in some instances, have forgiven rent and also given support to the businesses because they see the long-term benefits of keeping those businesses up and running.

We are in a situation with the pandemic, where we’ve had a prolonged period of inability to access some of these premises for some of these businesses and, as I say, a minority of those tenants and their landlords, for some reason or another, have been unable to come to an arrangement of paying a fair portion of rent. Now, we believe, in order to give more certainty to those businesses, to make sure that they can keep their businesses up and running, to make sure that they can ensure that the investment that they have made into their business, to make sure that the staff and the suppliers for those businesses can continue to operate—that’s something that actually needs to be done. I would hazard a guess that, actually, members on this side and that side agree that there is a situation for those tenants at the moment. We will disagree about how it’s done. The National Party would prefer that the Government pony up 50 percent, and I’ll come to that at some stage. But I will agree with some of the members that there is a high threshold to what we have done, but we believe that the point of justification has arrived for that because if we don’t do that for the small number of businesses, there is a high certainty that they will fall over, that their employees will no longer have jobs. I would’ve thought that the members on that side of the Chamber would actually be sticking up for small businesses in those situations, to make sure that they could have more certainty, but they are not—

💬 Hon Andrew Little: They’re funded by the big corporates, that’s why.

—but they are not.

So what this piece of legislation does—

💬 Chris Bishop: Point of order. The Minister of Health, as a very senior member, has just made an extremely gratuitous and unparliamentary remark relating—it’s so outrageously offensive that I do not even wish to repeat it but I invite him to withdraw and apologise.

CHAIRPERSON (Adrian Rurawhe): I’ll ask the Hon Andrew Little to indicate whether that’s correct or not.

💬 Hon Andrew Little: Mr Speaker, without knowing what the allegation specifically is, it’s a bit hard to respond to it. I think the member apparently took offence at my reference to some of the donors to the National Party. If that’s offensive in a democracy, then we are in a very, very difficult state.

💬 Chris Bishop: Speaking to the point of order. It is a breach of the Standing Orders—

CHAIRPERSON (Adrian Rurawhe): No, no, I’ll rule on it. I did not hear the comment and so I can’t make a ruling on whether it was in order or not in order. Every member is honourable, and the Hon Andrew Little has stated that he believes it was not out of order. Therefore I’m accepting his word on that. If you have another point of order, I’m happy to hear it.

💬 Chris Bishop: Speaking to the point of order.

CHAIRPERSON (Adrian Rurawhe): No, no, you’re not.

💬 David Seymour: Fresh point of order.

💬 Chris Bishop: New point of order.

CHAIRPERSON (Adrian Rurawhe): Order! I’m on my feet so, yeah—I have made the ruling. That’s the end of it.

💬 David Seymour: Point of order. A fresh point of order: when the Minister of Health, Andrew Little, most recently rose to his feet, he actually appeared to incriminate himself by indicating that he had imputed motives on the National Party due to their donors. Now, you know, as a fresh point of order, I’d say if he stands up and incriminates himself for breaching the Standing Orders, he should withdraw and apologise.

CHAIRPERSON (Adrian Rurawhe): Order! That is not a fresh point of order.

Point of order, Mr Chair.

💬 Chris Bishop: Point of order—it’s a fresh point of order.

CHAIRPERSON (Adrian Rurawhe): No, I’m hearing this one first. E noho. I’m hearing this point of order.

Mr Chair, I was just saying that when I was interrupted for that point of order, I was at a minute, 10 to go on the clock, and I see it’s run down, so just making sure you’re aware of that.

CHAIRPERSON (Adrian Rurawhe): Yep.

💬 Chris Bishop: Point of order. There are longstanding Speakers’ rulings—I was trying to remember my original point. I refer you to 52/4, which goes all the way back to 1933, Speaker Statham: “A member may not (1) impute improper motives to the Government; (2) suggest that the Government received orders to put a bill through; (3) impute dishonesty to the Government; (4) suggest domination by outside bodies.” That applies equally to members of the Opposition. It is quite wrong to impute allegations in the sense that the Minister was making, and he gave himself away by admitting it.

CHAIRPERSON (Adrian Rurawhe): Not in my opinion. I’ll reset the clock, just a minute.

Before that exchange, I was making the point that we are supporting small and medium sized enterprises who, at the moment, are finding it extremely difficult because they haven’t been able to come to an arrangement.

Now, this bill, or these changes to the Property Law Act, will give the ability—for those who don’t have a clause already in their leases—to come to some form of rent relief, the ability to do that. The changes that have come about through Supplementary Order Paper 78, under the Property Law Act, will ensure that revenue losses are taken into consideration when a fair proportion of rent relief is calculated, that there is an onus on parties to engage within 10 days when another party raises an issue with them, and there’s a retrospectivity issue of 18 August to ensure that this is meaningful for the businesses who have been finding things extremely difficult since this alert level change that was announced on 17 August.

Now, also a lot has been said about whether or not there is support for these measures, and I would like to say to those allegations that they don’t necessarily stack up. I have enjoyed engaging with the likes of the Property Council and the Auckland District Law Society, despite what they have said, to ensure that this bill is better.

What I want to make sure is a very clear message to those who are watching tonight—those small and medium sized enterprises who are up against the wall, who have no means of being able to come to a fair proportion of rent with their landlords at the moment, who don’t have any ability to do anything about that—is that the National Party and the ACT Party, the alleged champions of small and medium enterprise, are voting against this.

Point of order, Mr Chair. I’ve been reflecting upon what you said before. I want to seek your ruling on whether it is now in order for members to say that members of Parliament act in a certain way because of outside influence. If that is correct—in particular, in relation to payment, and I refer you to Speaker’s ruling 53/2, Speaker Robertson in the Chair “It would be out of order to suggest that a member takes payment to act in a certain way, and the member must be careful not to do that.” That is precisely what the Minister alleged. And, if that is now the case, frankly, I worry about where that may lead, and I would invite you to reflect on that, because that is precisely what the Minister said.

If the member is speaking about both the alleged interjection or the response to it, I’ve made a ruling, and I’m not inclined to go back on it. I will go back and have a look at it, to make sure that that ruling was in order to make. I believe it was, and, I guess, continued litigation of both the incident and my ruling, in my opinion, is out of order. But I will take that on board. There’s been, by my calculation, at least almost a dozen points of order in the last hour—a couple every five minutes. If I’ve got it wrong, then I will say that to the House and let you know. But, for the time being, Andrew Bayly.

Point of order, Mr Chair. I’m very reluctant to prolong this, but I might be able to assist. In my view, the Standing Orders are all still perfectly upstanding and upheld. The fact is that the member, who has subsequently departed, has said that he didn’t breach them, because he’s denied that he said any particular thing; so there’s no breach of the Standing Orders regardless of what he said. He said he didn’t, we take him at his word, the rules are still there, it’s still wrong to impugn improper motives on members—we’re all good to go!

And I’m fairly sure that’s what I said that I would go and do, and that I would look at what my part of it was. This time, Mr Bayly, OK?

Thank you, Mr Chair. I want to respond to that sanctimonious speech by the Minister Kris Faafoi just before about this issue around clause 6 of this bill. I find it incredibly rich that COVID struck our shores in March last year, and we immediately saw the financial impact of that on small businesses, and if anyone knew much about small businesses, they would know that wages are their highest costs in general, and the second-biggest component is rent.

Small businesses have been clamouring for support since March last year, and, here we are, this whole situation has arisen because, as a result of poor managed isolation and quarantine facilities, we have allowed COVID—this Government has allowed COVID—to enter our shores, and, as a result, our small businesses have been decimated in terms of cash. They’ve been decimated because they’ve been unable to trade as a result of Government-imposed lockdowns. And for the Minister to say that he’s standing up for small businesses 18 months after the first hit of COVID, I find incredibly rich.

And the solution that he is so keen to introduce under this bill is one that was proposed in the last Parliament, and, quite rightly, was refused by their partner in Government, New Zealand First, because of its poor design and its inappropriateness as a proposal. And here we are, now that the Government has a full and ultimate majority in this House, it is seeking to introduce the same piece of remedy to try and somehow help small businesses get around this issue of lack of cash. And I think the delay in the Government responding to this is appalling, and I think the Minister who’s just sat down has been incredibly tardy in trying to readdress a significant issue.

To that end, the solution itself is a very poor solution, for a number of reasons. The first one is that, first of all, it socialises the cost of the Government-imposed lockdown not from the Government to recompense small businesses but, actually, it socialises it and forces those costs on to landlords. And that, Mr Chair, I would suggest to you, is a form of social transfer from the Government to a group that the Government, for some reason, regards as a bank balance, and will have the ability to be able to pay and recompense and actually deal with this issue because they are deemed to be rich by the Labour Government. And, in fact, many of the landlords are not wealthy; many of the landlords will have borrowings on the property that they tenant to very good business owners. And yet this Government steadfastly has this view that they’re rich and therefore they should be the one writing out the cheque. That is the flaw in this whole proposal, and that is why New Zealand First, quite rightly, ruled it out in the last Parliament, and the Government should be ruling it out for that very reason.

The second thing about this bill is that it cuts to the sanctity of law—that is, people can have contracts of law, and yet this Government is running roughshod over legal rights between two parties that have entered into proper agreements—and lease agreements are proper agreements; they are often very lengthy and well defined and have established precedent. Yet, again, the Labour Government thinks it should stride in there and intercede itself in between what are viable and longstanding agreements, and yet, as part of that, transferring the cost to landlords.

The third thing is the definition around the law that is being proposed. Again, it is just as wonky as anything, because the first one is: what on earth is “a fair proportion”? And when you’re talking about tenants who have very, very little money and who are absolutely stressed to the max because they cannot trade, because the Government has imposed a lockdown on them—remember it is the Government who has imposed the lockdown, and therefore has made it impossible for them to trade—when they’re in that situation, it is highly unlikely that they have the money, the capability, the mental resources, and the resilience to be able to—[Time expired]

Thank you, Mr Chair. Nice to have the chance to respond to some of the points made by the Opposition. So, if I get the logic of the member who just resumed his seat right, and looking at the policy that they have talked about, as I say, the majority of landlords and tenants in commercial situations have already come to some form of rent relief, so the parties have sorted them out themselves. With no intervention or assistance from the taxpayers, a majority of landlords and tenants have come to an amicable arrangement to make sure that they, given the COVID situation, have found a fair proportion of rent.

In the logic of the National Party, we should do away with that and, instead of trying to come to an arrangement between the two parties in the contract, we should load up the cost on taxpayers. Now, this does not make sense in terms of the plan that National outlined last week or the week before that, because that will then increase the impost on taxpayers at the same time that the National Party says it wants to be decreasing spending and reducing debt. So which one is it? You can’t have it both ways.

So if you would clarify your position as to what we should do in this situation for the vast majority of tenants and landlords, whether or not you want them to sort it out between themselves and for them to figure out, given the situation that they may be in, both the landlord and the tenant, what a fair proportion of rent should be, and that it should be flexible in order to account for the situation that both parties are in. In some cases, the landlord may have a fair case that a reduction of 20 percent may be fair; in other cases it may be close to 100 percent that may be fair. You have to have the flexibility there, Mr Bayly, in order to make sure that you can account for those situations. But the situation is that either you let the parties sort this out amicably—and for the small number of contracts that don’t have a fair rent reduction clause, this is what this bill does. But it seems on the other side of the House, they want to instead load up the taxpayer for the impost for the inability to access the property. So which one is it? What do you want? Do you want to reduce debt and lower Government spending? Or do you want to load more debt up on taxpayers? The choice is yours.

Thank you, Mr Chair. Well, that’s a fascinating proposition that Minister Faafoi has just talked about. The issue is where a landlord has agreed, that will inevitably mean that the landlord has already given the tenant a discount, and so the situation is undisturbed. The issue with this proposal from the Government is one which is that if you are having a debate, it will be because the landlord will not want to give a discount. Therefore, by using terms such as “fair proportion”, that means that you’re inevitably in a dispute position, and that means that the tenant has, basically, got to go to the court or to arbitration to seek redress.

The issue is: how do you define “fair proportion”? And that is when you are in a situation where you’ve got a tenant who is highly stressed, has no money, and is in a difficult situation, and every week means that they will be losing more money. Therefore, you’re in a situation where this clause actually is unlikely to present much of an option, because in many cases a lot of these businesses have gone or will go to the wall, which we’re seeing in increasing numbers.

So that is the issue with this one. It’s that “fair proportion” is not well defined and will require time to be sorted, and, unfortunately, when you’re talking about these types of small businesses, they simply do not have time.

The other issue about this is that when you talk about the issue of fair proportion, it gives no guiding principles. It doesn’t confine it to small to medium sized businesses. It doesn’t link it to the wage subsidy scheme, which has been up to date, the way that the Government has implied it. Whether it’s the resurgence payment or wage subsidy, where there’s a specified reduction in income, there’s no specification around that.

The final thing is that it doesn’t relate to whether it’s income or capital. So you can imagine if someone went and got very smart lawyers, they could have a field day. That is why, again, the issue of the lack of clarity around this proposal that the Labour Government has put forward, and why New Zealand First undoubtedly refused to support it, is that it is a sham. It doesn’t actually achieve what it says it’s going to achieve. What it’s going to do is create a lot of work for lawyers and it’s going to take so long to actually work its way through that the benefit to these businesses that are crying out for cash today will be such that they do not get the benefit that they need immediately.

That is why we have proposed, to be absolutely clear, that if a company meets the requirement of a 40 percent or greater reduction in revenue, then it should be entitled to actually get support from the Government, because, after all, it’s the Government that has imposed the lockdown. It’s the Government that, through its actions, has led to that company not actually being in a position where it can trade, and that is the crying-out issue for small businesses, because it means they do not have access to cash. That is why we came up with a proposal that was specific, definitive, and also it gave the outcome where if there was a situation where a landlord had previously been incredibly generous, it could be resolved through arbitration in a quick manner.

Unfortunately, this proposal by the Labour Government does not achieve that. I can’t see why the Minister thinks that overnight we’re going to see a whole lot of businesses—and I suggest to him that there are a lot of businesses that are still crying out for cash—that are going to have any reliance that this is going to be achieved or resolved overnight, because every week that passes will mean that more companies fail in this business. I think this is the biggest shame about this whole thing.

This level of support from the Government has been woeful. We’re now into the 10th week, 263 days, of having Auckland businesses being in lockdown—this is one of the longest lockdowns of any city in the world—and yet this Government has sat around for 18 months and come up with a patsy solution to a major, major issue. As I’ve said before, rent is the second-highest cost for these small-business owners, and I think it is incumbent on this Government to actually come up with a meaningful solution to it, because you’ve been so woefully slow in trying to deal with this issue.

I look again at the Minister and suggest to him that maybe he should go to Auckland and go and see some of these people and just talk to them. Even the ones that have the 27.5 element in their agreement are still in trouble because a lot of landlords are saying, “You’ve still got access and we’re not going to listen to you, and we still want you to pay your rent.”

Just want to make sure we take opportunities to answer questions from the members. You will notice, through the Supplementary Order Paper that is accompanying this reading, that there has been a clause added to ensure that revenue loss is taken into account for a tenant in that situation.

As I mentioned in an earlier contribution to the member, keeping the parameters of what a fair proportion of rent is broad, given the plethora of permutations that could come up for different situations—different tenants, sizes of tenants, their financial situation, also the financial situation of the landlord—is extremely important to make sure that we allow that flexibility.

The member also gave judgment on whether or not this is going to be effective for small and medium sized enterprises. What we have certainly seen is that there has been a constant trickle of correspondence and messages back to the Government that we’ve already seen a behavioural change in many landlords who have not been able to engage or, for one or other reason, to start engaging with those small and medium sized enterprises since the Government announced these changes about a month ago.

So what I would say is that is an early sign of success, is that we’re actually getting parties to the table to ensure some of these high fixed costs that can’t be met, when the access is an issue for those businesses, are starting to be addressed and dealing with the frustrations that those business owners have been feeling, especially in the last two months.

Tēnā koe, Mr Chair. I want to acknowledge the Minister the Hon Kris Faafoi, and, in particular, on behalf of my colleague Chlöe Swarbrick, who had put forward a Supplementary Order Paper that has made one of the changes that has been picked up by the Government to backdate the commercial tenancy arrangements to the start of this lockdown period. So that was very much welcome. My colleague Chlöe Swarbrick also has another Supplementary Order Paper—74—which would go back further, all the way back to 25 March 2020, the time in which we first went into lockdown, to give those small businesses who have been under financial duress the ability to negotiate with the landlords through the entire periods that have been affected by lockdowns.

I do have to laugh a bit at Mr Bayly’s contribution and how blatantly obvious the National and ACT Parties are at standing up for the rentiers and the landed gentry. I mean, really, did they just come over to New Zealand to set up a new feudal system where they are the owners of property after land theft from the indigenous people? I think so. Always speaking up in favour of law that was written by the colonisers, and standing up for the interests of the owners of property rather than the people who do the actual mahi and work that makes our economy go round.

So the Green Party has a number of Supplementary Order Papers on Schedule 5. The one I’ve already referred to is Supplementary Order Paper 74. I also just want to acknowledge the work of my colleague Chlöe Swarbrick on the Finance and Expenditure Committee, alongside those Labour members, in representing the interests of small-business owners who have been treated quite poorly, in some cases, by their landlords.

I know Chlöe Swarbrick, in particular, as the member for Auckland Central, has been fighting for some of the businesses who rent in Elliott Stables. For two years, they have been fighting quite unfair treatment from the owner of that property. Yeah, I do find it quite amazing that Andrew Bayly refers to it as somehow socialising the losses, putting the cost on to those poor owners’ property, who have gained nothing in this past year, except a 25 percent to 50 percent increase in their capital values, which won’t be taxed. God forbid they should make some contribution to the collective, to the group, to all of us here in society, at a time when the economy is shut down—not because of the Government; the Government saved those businesses and those people by putting us into lockdown.

💬 Andrew Bayly: No, they made them go broke.

CHAIRPERSON (Adrian Rurawhe): Order! That’s rather loud.

It’s the pandemic, Mr Bayly, that shut down people’s ability to trade, not the Government. The Government actually reacted to protect people’s ability to trade. That is why Aotearoa New Zealand did so well in 2020, because we went into a lockdown, and the Government provided support to people and businesses that they were able to return to normal trade—a normal state that most countries in the world have not experienced since before March 2020. New Zealand was doing quite well and people were able to trade. And, of course, it was inevitable that it would happen again, that we would have a community spread, and that is very unfortunate but it was very difficult to avoid. As we’ve seen, no other jurisdiction, aside from Queensland—some of the jurisdictions which had been touted as managing it better than us—Singapore, Taiwan—have had extended community outbreaks before New Zealand did. Obviously, we see what is happening in New South Wales and Victoria. So, I mean, I do have to commend the Government for their management of the crisis last year. We do think that things could go further to rebalance in favour of the people, the working people, and the businesses, and away from the feudalism and the moneyed property owners, who somehow think they are entitled to keep extracting—

💬 Nicola Willis: Entitled to hire people, pay their wages, create jobs, ugh!

—excessive rents and never, never pay tax on their capital gains. You don’t pay tax on your capital gains, Nicola Willis, and you never will, thanks to your very effective Opposition. But that is, fundamentally, a structurally unfair aspect of our economy. It is feudalism. It is the case that owners who benefited from inheritance, no work of their own, a legacy of decades over a century of land theft, are able to profit, simply from owning property. And at a time when the entire economy is shut down, the National Party calls for the Government to both pay down debt and somehow subsidise the property owners so that they keep on making money at a time when their property values—[Time expired]

Point of order. Thank you, Mr Chair. I’d like to seek leave on the member’s behalf for an extension of time—

The member knows he cannot do that.

Well, as much as we would all love to hear that continue, as that member digs her own grave, I see that Minister Faafoi welcomes the contribution from Julie Anne Genter, who, in that contribution, has denounced private enterprise—

💬 Hon Julie Anne Genter: No, no, no—property ownership is not private enterprise.

—denounced private enterprise as being feudalistic, who has denounced commercial endeavour, and has questioned the very basis—

💬 Hon Julie Anne Genter: Land theft, colonisation.

—of business and its contribution to civil society in New Zealand. And what has provoked her to make these claims and ask these questions? It is Minister Faafoi’s amendments in this bill that have given her cause for hope that communism and socialism may yet replace private enterprise and endeavour in New Zealand. And is it any wonder that she has been given pause to ask those questions, when the bill we are debating in front of us retrospectively alters the terms of private contracts?

💬 Hon Julie Anne Genter: Sort of like the colonisers did with the tangata whenua of New Zealand.

It takes the sanctity of the private contracts and all that it represents and it retrospectively puts the great hand of the State—

CHAIRPERSON (Adrian Rurawhe): Order! Can we calm down? It’s five minutes to 10.

I’ll just note, for the members at home who may be watching the camera, that I have, I think, quite steadfastly ignored the constant barrage from the honourable member Julie Anne Genter throughout this contribution. She has much to say, and I would encourage those watching—

CHAIRPERSON (Adrian Rurawhe): Order! I dealt with the matter; no need to relitigate it.

What we have here is the Government putting the mighty hand of the State into private contracts. And what we know is that this is something that this Government—so mightily enforced by the agents of socialism and communism on their left: the Greens—has contemplated in the past, did contemplate in the past when there were lockdowns, but rejected as a course of action. So it is right and proper that we ask what has changed that the Government now believes this is appropriate.

And I want to note a few things. I want to note that there has been no regulatory impact assessment of the impact these changes will have in terms of the precedent that they set in terms of the uncertainty that they introduce to those signing leases in the future, that this Government, with its great hand of the State, may, in future, choose to intervene and in any roughshod way. I note that there has not even been a cost-benefit analysis of this change. In fact, the Ministry of Justice, in the documents we are given access to in the House, notes that the reason they couldn’t conduct that cost-benefit analysis was that the size and the scale of the problem is not clear. So what we have is one of the grandest undermining of the principle on which commerce operates in this country, which is the basis of private contract, undermined in order to address a problem the scale and size of which is not even clear and for which costs and benefits of the intervention have not been assessed.

What we then have is this curious admission that the Ministry of Foreign Affairs and Trade were asked for their input due to the need to consider international obligations. And I’ll just let you reflect on that, because what that suggests is that the gravity of this change is understood—it is understood as not only having implications here in our domestic market but it is understood to have implications for the way the rest of the world views this country, because, when we trade with other countries, it is very important that they think that this is a place where private contract is upheld. Members in this House know there are countries around the world where the arm of the State does reach down into business regularly, and we are nervous about those States, and business has difficulty in those States, and we here in New Zealand do not want to be one of them. So a very important principle is at stake.

Now, my colleague Andrew Bayly has put forward a very good alternative, and it is, frankly, lazy of members opposite to suggest that we don’t stand with those small businesses who are suffering, and to suggest that we don’t want to help them. We want to help them and we have offered constructive alternative ways in which the State could do that. But we do not think that it is justified to intervene into the sanctity of private contract, to do so retrospectively, to play to the Julie Anne Genters of this world, who would have New Zealanders believe that business, in and of itself, is a corrupt endeavour. We do not stand for that here. On this side of the House, we believe in commercial enterprise, we believe in contract, and we believe this clause is wrong.

Order! It’s come time for me to leave the Chair. The committee—[Interruption] I’m on my feet. Kia ora. The committee will resume at 9 a.m. tomorrow morning for the extended sitting. Pō mārie.

Debate interrupted.

Sitting suspended from 9.59 p.m. to 9 a.m. (Thursday)