Building (Earthquake-prone Buildings) Amendment Bill

Thank you, Mr Chair, and congratulations to the Minister, the Hon Simon Watts, on his first outing as the building and construction Minister. It is an important portfolio, and I wish him well in the discharge of his important duties around this bill, which, as you all know, Labour supports. We support sensible rules to remediate buildings that pose the greatest risk to life and safety, and maintaining affordability is one of our primary concerns. As you will also know, the previous Minister, the Hon Chris Penk, had amended the bill after it came back from select committee, and so most of my questions to him will be about that Minister’s Amendment Paper 702. I am going to ask him some specific questions about that as we move through Part 1.

For context, Minister, we have at all stages in this bill opposed the exclusion of Auckland as a specific provision. We have registered those concerns at the select committee and in the first and second readings. What has been designed here is a legislative framework which is meant to identify the buildings themselves—the individual buildings that are the highest risk to life and limb—but here we have an exclusion of an area as well. This is a sort of add-on which has come from a particular position. At all stages, we tested this with officials. We couldn’t get an answer about, “Well, if you have a system, essentially, which is designed for individual buildings, but then you exclude a number of those individual buildings which might be the highest risk, how does the rest of the system work together?”

Are we saying that a high-risk building in Auckland, which is technically lower risk than a low-risk building in Dunedin, is out of the system, and what does this mean for the building in Dunedin—that was a question that we couldn’t answer. That’s, basically, the question that I want to understand from each amendment. For our continued support for this bill, the test will be about: given that we have these specific concerns around Auckland—that Auckland contains around 1,400 earthquake-prone buildings, which is the majority of earthquake-prone buildings—are we now making even more exclusions which limit the number of buildings which will be recorded, and end up having an area which is arguably highly vulnerable to seismic activity—not earthquake activity—without any sensible protections?

The second question, which I’m going to ask him in a different way, as it comes up in these amendments, is about the shifting goalposts of time. I guess, the moral hazard which is created here is: how is the Minister amending those provisions which will be very important to homeowners who are still within the regulatory net but had a deadline that has passed now that the Government has extended it and that now the Government is giving itself more powers to continue to extend? Really, it’s whether any of these amendments have any further impact on those reasonable expectations that homeowners have—and I’m particularly interested in homeowners, although the commercial owners are, obviously, included in the net. For those homeowners who will have to do remediations which they cannot afford, now or in four years or in six years, what is the effect on them?

Those are the broad questions that I’m going to ask. The first question is around his amendment to clause 2 so that only section 12 is relevant in that, inserting the transitional provisions. There are a number of different transitional provisions in here. I would say the biggest ones are around Auckland, because on day one, under the old formulation, the Minister was proposing that Auckland would be excluded from day one, but now there are transitional provisions which apply to Auckland. In this clause 2, it brings in the Schedules and removes those Schedules because—firstly, the question is: are they just redundant, or are they replaced by another clause? How the transitional provisions work would be a good place to start.

Thank you, Mr Chair. I think, while the Minister for Building and Construction ponders on my colleague Arena Williams’ question, I just want to signal to the Chair that there has been a significant Amendment Paper released—Amendment Paper 702. While the Amendment Paper has been out for a couple of weeks, this is the first time post - select committee that we have had a chance to engage with the Minister directly on what looks like quite substantial changes from the bill as reported back from select committee.

I think it’s important for us to be able to check with the Minister on some of the changes that we do see here—noting that there is no departmental disclosure statement or any supplementary analysis report attached to the changes that we’re seeing in this Amendment Paper, as well. With that, I want to start by asking the Minister a few questions. Now, we see that there are significant changes to clause 4 regarding the addition of new definitions. I do want to touch on those definitions as they come up in the relevant clause. While others may have questions for those, I’m actually going to move on to clause 6 as a starting point.

Over here in clause 6, amending section 115(2)(b)(ii), amended by Amendment Paper 702—this is on the top of page 8—there is what I would consider a significant change here compared to the previous phrasing. Over here, “a former register-only EPB that ceased to be an earthquake-prone” previously said “after undergoing”, which is a process. It doesn’t necessarily state that the cessation of the status to be an earthquake-prone building is complete, particularly when it comes to the façade risk mitigation. But now it has changed to “because the building’s façade risk mitigation was complete”.

Now we’re looking at a completed action as opposed to “after undergoing”, which could also, I would say, imply a duration or in the process of completion. I want to check with the Minister as a starting point: what was the reason for this change? As a part of this change, how many buildings then would this include or exclude as a result of the change of status?

A couple of questions then for the Minister for Building and Construction as he considers my question around clause 2, to clause 4, which is the definitions section. He’s added three new definitions, which I want to ask him about.

The first is just defining the term “remediation”. Minister, within the Act, remediation is used several times. It is not necessarily to mean the words given to it by new section 133AZAA(4) as amended by Amendment Paper 702. “Remediation” has a natural meaning in the Act as it is, and it also has a meaning in the Building Act. Surely we don’t mean to define “little r” remediation in that way. Could he help me to understand how that defined term—that’s now being defined by a section further on in the bill—could possibly mean only that definition and not the natural meaning of the word?

My other question is about the earthquake-prone building (EPB) warning signs. Again, this is a new way of working for those low-seismic-risk areas. Auckland now has a system that officials advised us was more similar to that of California, where signs and disclosures are used rather than remediation rules. I want to ask him: in defining “EPB warning sign” in this way, does he only mean that there are EPB warning signs which are regulated in those low-seismic zones and in the new way that these are intended to work? Or is he also intending to regulate the signs which already exist in a number of other areas?

Councils like Wellington and Christchurch use signs to disclose information about earthquake-prone buildings all the time, and disclosure obligations for commercial buildings already exist. They don’t exist for residential, say, homeowners, for tenants—you don’t have to use signs if you’re a landlord, but you do have to use signs in a commercial context to give people who are using your buildings the kind of warnings which the Minister is setting out. But again, this is the definition about the way that those would work in the low-seismic zones. I just want them to clarify. There are some EPB warning signs which are regulatory and some which he doesn’t intend to capture. Or does he intend to capture them all and to have a sort of national level of consistency?

I also want to ask him about the targeted retrofit meaning here. Previously when targeted retrofit was undefined, that might have been a useful term to describe basically the works that were for things like unreinforced masonry—I’m going to have to say that a lot in this committee stage—where we were talking about the walls, but no other structural work. Now it is being defined, so it only means this particular kind of retrofit, which seems to me to unnecessarily limit what the legislative intent is trying to get at, which is that building owners would mitigate the risk in the way that they see fit. It would be helpful if the Minister could clarify those before we move on, especially to the unreinforced masonry discussion that we’ll have also in Part 1.

Thank you very much, Mr Chair. Thank you, members, for the opportunity to work our way through what is a very, very important bill. That will derive about $8.2 billion of benefits to the New Zealand economy, $4.5 billion of which in Auckland alone, once this bill is passed into law. I’ll work my way through the questions—helpful, members, if you do refer to the clause. It just helps me be a bit faster in my ability to answer.

In regards to clause 2, the question raised by the member is related to a drafting change. The words are the same as those at select committee—it just looks different.

Clause 3—and I didn’t pick up the member’s point around the clause, specifically around remediation requirements. However, listening to the question, it looks to be the same as the one around 6(3), which was the detail of the risk mitigation and therefore the remediation requirements are both part of the earthquake-prone building methodology.

Another question outlined which—the response is around what proportion of buildings are removed. About 55 percent of buildings will be removed around this change. This is about applying a proportional risk-based assessment to buildings. It is about ensuring that that proportionality is balanced to protect loss of life, but also acknowledging that before these changes came through, the total cost on the economy to remediate the buildings was in the range of just under $12 billion. As a result of that, $8 billion will not be required. That sounds like a good thing for the New Zealand economy.

Mr Chair, just seeking your clarification because the Minister for Building and Construction has just widened the scope of this debate to talk about billions of dollars of benefit when it comes to the economy. But if the Minister is going to be disclosing certain numbers, it will be important for us to know where the numbers came from, particularly $4.5 billion of benefits to Tāmaki-makau-rau, Auckland. How is that derived?

But from what the Minister was saying previously, is it a benefit or is it a reduction in the liability when it comes to the building? Because it seems like not fixing the building is not necessarily—

💬 Simon Court: You should have been at the select committee, mate.

I mean, please, again, I’m keen to hear the Minister’s clarification. Not fixing the buildings or having buildings exempted isn’t so much better the economy as in it means that people don’t need to—in some ways, for a lot of property owners, they don’t need to spend the money fixing it. But at the same time, as a starting point, the Minister talked about numbers and I would be keen to know where the Minister got those numbers from.

Question to the Minister. I am moving on to clause 7, noting that clause 7 is the substantial part of this bill. For clarity, Madam Chair, I will be referring to the new section numbers instead of the clause number—because I think about 30 pages of this bill is the same clause. I will be referring to new section 133AB as a starting point. This is the 76bottom of page 9—again, noting that others may have questions elsewhere.

In new section 133AB(4), inserted by clause 7, there is also a change and I couldn’t find it in the explanatory note, so if the Minister wouldn’t mind elaborating. In Amendment Paper 702, there has been a change that changes the way an earthquake-prone building is registered to now an earthquake-prone building (EPB) registered immediately before 1 July 2027. I want to check with the Minister, why has there been an extension to the middle of next year when it comes to this particular part that wasn’t part of the select committee?

Now, I want to ask the Minister, and again, I acknowledge there are people in this House who are far more skilled than I am when it comes to understanding building construction and material. But looking at new section 133AB(6)(b)(ii) and also (c), we are also seeing—OK, I’ll start with (6)(b)(ii), because (c) is quite substantial. New section 133AB(6)(b)(ii): “tall building built using heavy materials”. There is also a specific change—and I won’t talk about the EPB methodology yet, but I just want to check why has there been a change in this case? I would have assumed that the previous wording, as those concepts are explained in the EPB methodology, would actually be sufficient to address the same idea. Why has there been, I guess, additional clarification given in that instance?

For new section 133AB(6)(b)(iii)—Madam Chair, this is my final question here. It has changed. New words have been inserted: “to be considered”. Who, then, is responsible for doing the consideration? Previously it just said it’s a tall building but now it has to be considered a tall building. Clarification for that would be great. Thank you.

Thank you, Madam Chair. First of all, I’m just interested—the Minister’s obviously stood up and was very proud about all the money that’s going to be saved. My thoughts, actually, are on people’s lives, especially when I look at Christchurch where I’m from and the 185 people that died there. It’s actually really important that we take this really seriously, because actually it’s people’s lives with this type of legislation.

There are just a couple of things that I want to talk about in the first couple of clauses. In clause 4, there’s a change there where “engineering assessment” has been repealed and it has been replaced with “engineering evaluation”. It appears to me that when you look through this, one of the main changes is the word “assessment” has been removed. In the interpretation in the Act, when it talks about an engineering assessment, it actually mentions in the interpretation that there is an assessment. When it goes into this new—and I’m working with your amendment to the amendment bill. It just talks about an evaluation. I just want to get some clarity, I guess, about what that actually means when we’re moving away from it being an assessment, an engineering assessment, to just an evaluation.

The reason why I say that is because after the September 2010 earthquakes and before February, there were a lot of evaluations being done on the buildings within the CBD. We had red stickers put on and yellow stickers put on and green stickers put on. Obviously, February happened and then buildings that were evaluated with green stickers collapsed and people died.

It concerns me when we look at this and it just says, “evaluation”. I’d hate it if we’re actually lowering the standard of the assessments that we’re doing on buildings through this. I’m sure that won’t be the case, but it’d be great to get some clarity on that to make sure we’re not lowering the standard of engineering assessments that we’re doing on buildings to determine their status.

I then just want to pop across new section 114A, inserted by clause 5B. I just want to double-check, because I understand that there is no change of use for earthquake-prone buildings (EPB) until the remediation is complete. I wasn’t on the Transport and Infrastructure Committee so this may have been addressed, but what if the actual change reduces the risk to people? Maybe fewer people are actually going to be in the building or around the building. My question is are we therefore potentially not reducing risks if actually they could change it to actually have less risk?

My last question in this call is on clause 6. It’s just down the very bottom of the page where it says a register-only EPB. In the interpretations of the amendments in the Act, every time it has “EPB”, it’s like there’s EPB methodology, EPB notice, it has an interpretation of this. This is the only place I can find where it has EPB but no interpretation, so register-only EPB, but there’s no interpretation of it. I’m just wondering why this is, because everywhere else it will have “earthquake-prone building” and every time it uses “EPB” there’s an actual interpretation with EPB and the word that goes with it. I’m just curious about what that is and why that’s like that.

They are my three questions. The first question is on actually the interpretation of “engineering evaluation” and whether that’s a lower standard to an engineering assessment. What would happen if, actually, a building owner wanted to change the use of an earthquake-prone building to something that actually would reduce the risk to people? Also clause 6 where it talks about a register-only EPB, there is no interpretation to that. I’m just curious about what that actually refers to.

Thanks, Madam Chair, and thanks, members, for your questions. I want to make it very clear for the member—I don’t think he was necessarily implying that my reflection of the cost savings didn’t take into account the reality of the loss of life incurred across this country. I don’t think he was implying that I wasn’t being empathetic about the reality, because we all know that that was significant, and it absolutely is something that is that. The reality of the numbers that I was articulating though were provided through the expert consultants in the context of before and after the change, which I think is an important perspective in regards to what impact this has from that regard.

The changes are proportionate to the risk which is in play depending on the region of New Zealand and the questions raised around evaluation. It’s fair to say that the evaluation is less intrusive than an assessment phase. It does not require the same level of work to identify any deficiencies and it is a more a cost effective. So there is a point of difference between those two points.

The member also asked question regards to clause 4, the detail of the engineering evaluation. Again, as noted in regards to the question answers previously will be described in the earthquake-prone methodology which was set by the CE.

A number of other questions in regards to the date, the clause of which I think was 113AB(4)(B)(ii)—just reflecting I was listening—1 July 2027. That is the date for building within the scope of the bill and that’s relating to tall buildings and the tall buildings heavy construction drafting change is also based on advice from experts at the Parliamentary Counsel Office. To be fair, as was noted previously to another answer, it’s just better wording to reflect the policy.

First to the Minister, he gave a percentage of the buildings that will come off the register as 55 percent and then gave an explanation about why those are coming off and out of the regulations as that there is more proportional to the risk.

Minister, I want to clarify and understand what you’re saying there, because most of those buildings will be the 1,400 or so in Auckland which has yet to be remediated but are coming off the list anyway. That is a change which at no point in the official advice, we’ve had advice that those are buildings which are low risk. Instead, we have this new part of the regulatory net which is an area that is deemed to be low risk. Is what you’re saying that it is still proportional to the risk to take those off? Because that’s not my understanding. My understanding is that that’s a decision which has been made, that is expedient, that takes a number of buildings out of the system, recognising that it is difficult and expensive to remediate, but not necessarily because those are low-risk buildings at all.

I also want to ask the Minister about clause 6 of Amendment Paper 702, but this is a different question. It’s not about the words; it’s about the buildings which are being built in Wellington now which are apartment conversions from commercial builds. This is something that we tested at the select committee reasonably robustly. A number of submitters were particularly interested in this. It’s not a big industry. There are a few developers who do this. Generally, it’ll be one guy who has been in the building industry for a long time and has put his entire capital into buying a commercial building to do the conversion in, so these remediation costs are very important to them.

My question is: have you made it less permissive, in a bill that is meant to be much more enabling of development work? It’s meant to be pro-developer, pro-commercial property, and large residential landlord-owner permissive. Is this one of the changes which actually seems to be worse for those people who are in the process of going through remediation to those buildings, which will need their status to be converted after they’ve finished? Often the commercial-to-apartment conversions only happen in a change of use at the end, because the works happen while they are commercial buildings. This change will affect some of those buildings, like the one that is opposite Stats House, just down the road from here, where the developer has undergone remediation but he hasn’t necessarily completed that remediation. He has a building consent, but he will need his final consents and approvals for each apartment. He still has a sign-off to go from council. It’s not like he’s finished once he’s gone through the process for undergoing the work, so this needs to say “completion”, because the council still does have a stage where they can check completion.

Look, it’s not many cases—there are, like, five of these probably—but, for the people who have undertaken them, it will be the difference between whether they need to sell their apartments for, say, $600,000 or for $620,000 to recoup the costs. It is a relevant consideration for those people who are undertaking their work, and it does represent a number of affordable builds in, say, Wellington and in Christchurch that are going on at the moment.

Thanks, Madam Chair. Thanks to the member Arena Williams for the question. To add further context in regards to the risk question and the point, the bill does, through its focus, really focus the remediation requirements on the most highest-risk buildings across the country, and as a result of that, that is expected to increase compliance. Also, the reality there is that the focus, equally, is through ensuring that the focus is on the higher seismic-risk areas, and those buildings that are in zones that are considered low-risk are going to be removed, because their risk is relatively lower.

In regards to the other aspects around questions on risk, the low-risk definition portion is informed by the national seismic hazard model, which is, obviously, updated as the science becomes updated and available. The earthquake-prone building question, in regards to definitions around section 133C: the building has to be evaluated first, before it can be under the earthquake-prone building and in terms of that determination as well.

Thank you, Madam Chair. Can I just acknowledge the Minister for Building and Construction for his responses. I actually think that the Minister holds portfolios—a suite of portfolios—that are equally associated with these issues, in terms of building and construction, but also local government obviously has a really important role here; and as Minister for Auckland, given our view around where Auckland should sit, or not sit, within this. That’s clear in the select committee report back. I want to acknowledge this: the fact that the Minister has a number of hats that are relevant to what’s happening tonight.

The other thing is that, with Ms Williams, I sat on the select committee that dealt with some of these matters, and back in February, I think, of this year was when we heard the submissions as part of that process. What we do have in front of us at the moment, Minister, is your Amendment Paper that is much more recent than that. The select committee, despite its report back, hasn’t actually had an opportunity to tease out some of these issues that you have identified. One that I do want to ask the Minister about is the proposed change in new clause 5B. This would insert a new section 114A. In essence, what we see that this does is it requires the owner of the building to not change the use of the building until the seismic work is, effectively, complete or under way.

Now, we’ve heard a little bit from the Minister this evening around the economics of not doing this stuff and also doing this stuff, but there is one part in there which relates to, I guess, the assessment of the impact this might have on the provision of two things. One is on vacant land, which is often in urban city areas, and not necessarily huge swathes of vacant land—areas where there might be parcels of vacant land nearby and some buildings that are subject to new seismic requirements. The other is, as the Minister will know, particularly in some smaller towns, often there are town revitalisation projects that are under way or part way through a process where there is a requirement where the use of the building is, effectively, subject to a freeze until the seismic work is complete. I’m just trying to get a handle from the Minister, if he’s able to, around what the kind of value of that side of the work is, in terms of not doing some of that stuff.

As Arena Williams has said, we do support this legislation, although we’ve had a track record tonight already where we have supported a bill and a late-landing Amendment Paper has effectively changed the position of the Labour Party. It would be helpful just to understand from the Minister some responses to those issues.

I thank the member Tangi Utikere for the question. The question in regard to new clause 5B, new section 114A, noted the points around the change of use, which is a defined term and defined in regulations. Basically, what that’s looking at is changing the use of a building from one to another, but only in circumstances where the change to a new use, which is in effect, in this case—that’s the point which triggers more onerous building code requirements, and it’s that trigger point that that the definition is referring to.

Thank you, Madam Chair. I must say, before, when I asked the question around “register-only EPB”, I must have been getting tired, because it’s quite late at night, because, as soon as I sat down, I did see the interpretation on the other page. Apologies for that question, Minister.

I do want to move to clause 7 of Amendment Paper 702, new section 133AB(1)(a). I have a couple of wee questions on this part. The first bit is around a building that is used wholly or mainly for residential purposes. I just wanted to understand, I guess, what the interpretation of “mainly” is. I know that, through the earthquake Act itself, that caused a lot of issues when they’re trying to decide whether a building was commercial or residential, and it was an ongoing issue for some time. I’m just wondering what is considered “mainly”? Is it over 50 percent of the time it’s used for residential purposes, or over 50 percent of the buildings used for residential purposes? Or is it a higher bar?

Then, further down, at new subsection (2)(b)(i), I’m just curious where it talks about “is a hostel, boardinghouse, or other specialised accommodation;”. Specialised accommodation—does that also include short-stay accommodation like Airbnbs? Or are they not actually part of specialised accommodation? They’re just two quick questions I’ve got on that around what is the definition of “mainly” for residential purposes and whether “specialised accommodation” would include short-say accommodation like Airbnbs.

Thank you, Madam Chair. Thank you for your response to my questions, Minister. I want to move on to new section 133AB(6)(c)—this is a new section, and this is the bottom of page 10 and top of page 11. This is where the definition for the “unreinforced masonry building” has been narrowed, I think particularly with the inclusion of paragraph (c)(ii). I want to check with the Minister for Building and Construction, first of all—again, the explanatory note doesn’t actually say what the rationale is for narrowing the scope of “unreinforced masonry building”—whether there has been any modelling that has been done on, again, how many buildings will now be excluded as a part or, like, a percentage, or how many will be excluded, because of the narrowing of the criteria. That’s my first question.

My second question, when we are looking “at least 1 of those exterior walls” needs to face—previously, it just needed to have one exterior wall that was built of unreinforced masonry, but now it has to face “a public road, footpath, or other thoroughfare”. We have seen, understandably, that there is a human life and health and safety component when you are looking at including the criteria for a public road and footpath. To give you an example, there is a line of buildings that is on Newton Road in Auckland—for example, because that’s where I travel quite frequently—where if there is an earthquake, that whole wall will fall on the footpath. So I see why this is included, but what I don’t understand is by narrowing that scope, what modelling has been done in terms of the potential human life lost or injured if you have an exterior wall of unreinforced masonry that falls on another building?

If the definition is a “place where people congregate”—I want to move just to new subsection (7)(a). Again, other people may have other perspectives around this. It does give a definition of “place where people congregate”, but what about, for example, if you have an evacuation point? An evacuation point in the event of an emergency is neither a place where people intended to gather—as far as I know, because it doesn’t fulfil the example that’s given here, like a bus stop. You’re also not otherwise likely to gather on a regular basis, because it’s an evacuation point. You don’t normally congregate there until you need to congregate there. But in the event of, potentially, an earthquake etc., for example, is an evacuation point captured by this? I would assume that an evacuation point does not meet the requirement of a place where people congregate, in which case the narrower scope will not capture these sort of buildings and therefore these buildings will presumably be excluded from the definition of “unreinforced masonry buildings”.

I just want to check with the Minister if my interpretation is correct and if my example is an accurate example of what could be considered “place where people congregate”. Thank you.

Thank you for the questions. Just in regards to the question on new section 133AB(2)(b)(i) in regards to Airbnb, technically, yes, if there were two or more storeys. However, it would also then come into the detail in regards to specifics around fire evacuation purpose, duration, and all that. It really depends on the detail, the nature of that operation—but technically.

I just want to come back to my question to the Minister on clauses 5B and 6 about change of use. This was something that was examined reasonably carefully at the Transport and Infrastructure Committee, so I want to make sure we get it right. I’m not confused about what a change of use is. What I wanted to know was whether for the conversions of commercial buildings to apartment buildings which are ongoing now, the provisions which he has proposed, which are even more, I guess, prohibitive or strongly worded than the ones that the select committee proposed, are too strong for those ones?

The question is—there are a few of these buildings which are going through at the moment, and the original wording or the provision had to be that that remediation was, basically, ongoing. There’s no suggestion in the old words that it wouldn’t have been completed by the time that the council had completed its final sign-offs. But what this new wording says is that at the point of the change of use, the remediation has to have happened.

My question is whether that is unfairly prohibitive for those commercial building owners who are undergoing conversions now, in a way that is actually more prohibitive than what the old rules—which this Government has intended to make more liberal—were, even before. Under the old rules, all of the examples that I have talked about would have needed to get up to 67 percent—the magical number—compliance earthquake strength. That doesn’t apply anymore. It is more case specific. But now we’ve got this problem of having to do that before you apply for your conversion. For some of them, that will create an extra unknown in the way that they have sequenced their developments.

My question is: is that the intention, when it just doesn’t seem to be fitting with the Government’s policy intent to make things simpler for building owners who are upgrading their—because the intention here is that upgrading your earthquake standards in a building shouldn’t then also trigger a number of other features which mean that you have to spend even more money to bring your building up to a code of compliance standard which is not like-for-like. If you had a perfectly safe and serviceable commercial building for the purposes of the earthquake rules and you’re using it now for apartments, there should be some similarity of those rules across the two uses in a way that makes sense to the ordinary person on the street and doesn’t require a much higher burden. Is this consistent with that policy goal is the question.

Thanks, Madam Chair. Just in regards to the points raised by the member there around the change of use requirements, it’s important to recognise that those requirements are based on and fall off the back of the recommendations from the royal commission of inquiry after the Canterbury earthquakes in 2011-2012. That is the basis for where those come from, and the context around transition from one type to another follows from that underlying basis.

The question before also around—I didn’t get the clause, but the evacuation point one?

💬 Dr Lawrence Xu-Nan: Yeah, it’s (7)(a).

The short answer on that is that it’s a technical matter that, again—and I’ve used the same answer for multiple, but it goes back to the earthquake-prone building methodology changes that will be defined by the CE through secondary legislation. That’s where that will be included.

Thank you, Madam Chair. Can I ask a question of the Minister for Building and Construction in relation to clause 7. Quite helpfully, I think Dr Xu-Nan’s suggestion of referencing the relevant new section is probably easier for people to follow. So this is the proposed new section 133AB(6)(C)(ii)(A) and (B). This is, in essence, a replacement as to the definition of “unreinforced masonry building”. What is clear in the Minister’s Amendment Paper 702 is that the definition is extended quite significantly from what was there. So Minister, you are suggesting, effectively, a strikethrough of two provisions there and, basically, expanding that out.

The two components there that relate to at least one of the exterior walls’ actions, as such: one is the facing of it on to a public-facing area or pathway or footpath or road or what have you. This goes to Lawrence Xu-Nan’s point around where people congregate. There’s a question there around who decides that component as opposed to a specified—I think the member said bus stop or frontage or what have you. It would be important to understand who actually makes that determination.

The second part there is around it being considered close enough to that public-facing component there. But there goes on to be a further one in new paragraph (d) that references this issue of an urban centre. Now, if we root down in new subsection (8), there is a definition there as to what an urban centre is—which is helpful, I think, because is it an urban centre, is it an urban area; what is this?

But of interest is that it’s referencing a Statistics New Zealand kind of documentation classification there—

💬 Arena Williams: Didn’t have that one at select committee.

No, we didn’t actually, and this is why it’s jumped out a bit, because what we did have in the Transport and Infrastructure Committee is a map of New Zealand that identified Auckland, the Chathams, and whole parts of other areas in the country shaded representing the sort of seismic risk of that.

So why is it that now we have a reference to a document issued by Statistics New Zealand or an approach by Statistics New Zealand which might on face value be helpful, but in terms of its usability being constructive, where a diagram might be perhaps another option rather than—or a list, as opposed to another reference. Obviously, the Minister is seeking to introduce that, so it would be helpful to understand why the reference is not consistent with other approaches previously in front of the select committee.

I thank the member for the question. We’re referring here again to new section 133AB(6)(c)(ii). This comes off the back of the Cabinet process and the Amendment Paper, which was in effect the narrowing of that definition around the unreinforced masonry building so that the regime, in effect, better targets the exterior walls that pose the life safety risk. That’s the whole purpose around the definitional change that was made around that—at the same time, though, as is noted, the expanding and refinement of the anytime pathway to identify any relevant buildings after the ordinary identification deadlines and then adding some risk mitigation exemption pathways as well in there alongside the five-year period where an exemption is revoked after the seismic work deadline.

So all of these elements included within that are in effect to ensure that the focus of that definition is more targeted in the areas around the risk, which goes back to that opening statement around the purpose of this as around ensuring that the focus of the broader legislation is focusing on the area as opposed to highest risk.

In regard to the question in regard to the mapping point—and I get the point, and I’ve seen the old map and the new map. What was acknowledged is that many territory—and this goes back to the local government portion of the overlay, that a number of local governments across the country are moving to digital map publication and have quite detailed mapping aspects. So this in effect provides a transition period, acknowledging that, you know, we’re trying to get the best available information data to make best-informed decisions.

Thank you, Madam Chair. Thank you for your response as well, Minister Watts, but just noting that I think for some of these, like you said, Minister, the additional flexibility that is offered by the earthquake-prone building (EPB) methodology might actually be stated in some areas, but sometimes if it’s not inconsistently stated or highlighted, it is actually helpful for the Minister even just to say that this is something that will be considered later on as secondary legislation. Again, I’m trying not to discuss the EPB methodology because I believe it’s proposed new section 133AZI, so it’s right at the end of where we’re going to discuss.

But I’m going to move on to new subsection (8). I do appreciate the Minister’s response around urban centres. My only question for this part is why is it so specific to the date and also the specific volume potentially or publication by Stats NZ around the functional urban areas. I guess I’m assuming it could have been done in a way that is more generic, because now if Stats NZ updates its methodology and classification, presumably then we now need to change this particular piece of legislation as well in response.

I’m going to move on to new section 133AD on page 12. Again, this area has the two definitions for required remedial measure—you know, with facade risk mitigation, but also targeted retrofit. But I’m more interested in the new addition in new section 133AD(2), which again talks about the EPB methodology. But what I’m finding, and maybe the Minister is able to explain, is now we are giving more kind of flexibility around how regional or local councils or regional jurisdictions—additional ability to add or include additional things for the EPB methodology. Would that risk inconsistencies between different areas, or is the secondary legislation going to be encompassing not so much the whole country—because I know certain areas are excluded.

I’m just thinking that if, for example—maybe Auckland is a bad example, but if, let’s say, Wellington decides to do something that’s different through EPB methodology, then Palmy doing something that is different in EPB methodology, how then would people know what was required when it comes to facade risk mitigation or targeted retrofit?

So I’m not entirely clear on why this additional part with the additional requirement and the EPB methodologies need to be added in for the purpose of 133AD.

Thank you, Madam Chair. I have a question and it’s around new section 133AB, because when you read through this, it obviously defines what an earthquake-prone building is going to be in and it does reduce the amount that there currently is.

CHAIRPERSON (Barbara Kuriger): Was that AB?

AB. I just wanted to know: was there any analysis done on the buildings that did collapse in the Canterbury earthquakes that did result in loss of life? Would they have been captured and deemed as earthquake-prone buildings under this new bill?

I guess this is one of my concerns that I’ve had with this bill. Unfortunately, I wasn’t in the Transport and Infrastructure Committee, and it may have been spoken about, but it’s just ensuring that, as we reduce it—and we understand the reason why we need to reduce the amount—actually we look at the past as well and see what happened there and ensuring those buildings that did collapse would have been captured if they were still standing if this regime was in place. So I’d be good to know if there was any analysis done on that.

Thank you, Madam Chair. On to reinforced masonry at the end of page 10 and top of page 11. The narrowing of the definition of unreinforced masonry (URM) is something that I thought carefully about, because we do support this bill; we want to make this a workable regime.

So I want to clarify with him—firstly, these are pretty narrow conditions. The “over three storeys” would be one that I could then guess how many buildings are actually still on the register. But because it’s one exterior wall now, I can’t. So first question is: how many buildings will be on the URM register that was part of the Royal commission of inquiry after the Canterbury earthquakes? There’s a special register for URM buildings, and now that we have this condition set out at (ii)(b), it’s quite unclear what will then be on the list of those buildings.

For instance, something like the Newtown Hotel—formerly, the Ascot Theatre, which Wellington members who are interested in this bill know about—is something that probably meets the criteria for the exterior walls. It might meet the criteria for a publicly facing area where there are people going past, but doesn’t meet the criteria for the three storeys. Some of these very well-known buildings with issues which have been flagged and then quite publicly debated. And their history—they are well-known to the residents. This is one, I think, which is still ongoing after the 2018 special funding that was made available to the Wellington City Council to remediate some of these buildings. So there are buildings like that. Another one is the T G Macarthy building at 58 Cuba Street, where it is unclear to me—and I follow this closely—whether those will still be included in the definition. That is important, because: is this now a definition that is so close that it only really captures things like the Kennedy Building, which are tall, or does it now exclude many of those buildings which have been subject to a pretty fierce public debate?

I also want to ask him about—there are plenty of areas that are outside of Wellington, say the Manawatū District Council and Feilding town centre, which are particularly affected by the concentration of these URM buildings. Government did say specifically the intention of the policy was to make sure that some of these small towns weren’t crippled by the costs of remediating their town centres. But there will still be well-known public buildings where the people in those towns who were the most vociferous advocates for a more permissive and more liberalised system still know that there are some buildings that will need to be remediated. Because there is a public risk, because they are exactly in the town centre, overhanging the main street. Those are in, but there are other buildings in which it is unclear to anyone who has a public interest in this, whether they will be remediated.

That is really the point here, is that this was meant to be—after the Canterbury earthquakes—a regime which also created a public interest in the remediation of buildings that formed a partially public function. Whether it was the library building in Wellington, whether it was the cinema in Wellington—which has people going through it all the time who are not going to read signs on the door about remediation requirements before they decide whether to go in or out. I have been someone who has taken my children to the cinema in Wellington when there has been an earthquake, and it is very scary because you know roughly in your head that it is an earthquake-prone building but you don’t know quite what the risk is. That there is a public interest is part of the how the regime is intended to work. His new definition has made it very hard for people to even determine whether some buildings in their town centre which they walk past every day on their way to work will need to be remediated or not.

So this goes to my question: how many buildings has he excluded by now changing the UMR definition, which was a key part of the findings of the Royal commission after the Canterbury earthquake, to something which is much, much narrower and seems to only apply to tall buildings going forward?

Thanks very much, Madam Chair. Thanks, members. I think this is an important point in the context that the majority of loss of life in the Canterbury earthquakes were as a result of people that were injured and killed as a result of the URM, or are the unreinforced masonry, aspect collapsing and/or heavy concrete buildings. So the member’s point and question around assurance that the recommendations from the Royal commission inquiry in regards to that were taken on board around this and were taken into account as part of this legislation. Those buildings specifically have been included in regards to this.

In regards to the, I think the member mentioned the Macarthy building and the Kennedy Building. I’m not an expert on what they’re made of particularly, but on the basis that they are URM or concrete, then they would be remediated because they were in a medium or high zone. All of the specific detail in regards to that will be in the earthquake-prone building methodology consultation.

CHAIRPERSON (Barbara Kuriger): Dr Lawrence Xu-Nan. I just want to check, is everyone ready to move past page 12? Is there anything prior to page 12? We’ve done quite a bit on those first few pages.

I’ve actually got one question just on the last bit of the remediation method, but that’s on page 13, that’s (2)(c), and then I’m going to move on.

CHAIRPERSON (Barbara Kuriger): Seeing you’re on your feet, you do that question—you do your question now. But then if Arena Williams has something that she wants to go back to.

Of course. Thank you, Madam Chair. I just want to check, because the new insertion here of 133AB(2(c) allows for the ability for a building to be determined to have more than one required remediation measure. I also think that—I will be interested to know from other members of the House of how they feel about this particular part. But I think I’m more interested in if a building is determined to have more than one requirement, would that also be reflected in the way they are notified, that more than one requirement is needed. And they will be detailed—in terms of whether the requirement based on the tall building or using heavy materials or unreinforced masonry buildings—it will be detailed to the point that they are able to say that this is the required mediation measure, this is what it is, and you will need to have facade risk mitigation or targeted retrofit. Just want to check that. That’s also going to be able to be spelled out for whoever is, I guess, responsible for that particular building

I am going to move to—and again, I know that my colleagues Arena Williams and Tangi Utikere and Mike Davidson may have additional questions, but I wanted to check with the Minister this new insertion on page 14. So this is 133AEA. I like the fact that it’s been taken out from what looks like the previous 133AE(2) and it has been given its own individual section and it has kind of elaborated on the requirement for the chief executive to publish and maintain a map. But can I just check: has there been any thought, since I believe that, particularly—(2)(a) is added, and I think (ii) is added. I just want to check with the Minister if there’s been any considerations of other things that could also be included. And not seeing any sort of exclusivity or exhaustive language being used for 133AEA(2). I’m assuming that while (2)(a) and (b) are required, that it doesn’t preclude the chief executive from including other things on the map as well.

I just wanted to follow up. My question was in the context of the Wellington buildings, and the ones that we are talking about there are really around public roads, they’re public buildings in some cases. But in the context of say the Hawke’s Bay or the West Coast, the committee considered a number of buildings which were not like that. It was put to us by one submitter who was very much in favour of this change—he was advocating for a particular small church on the West Coast that was only used for things like weddings and for people who were celebrating that particular building because of their family history.

So, very few uses in a year, and I think what the Minister for Building and Construction is telling us is that something like that would fail for every criterion but for new subsection 133AEA(2)(b)(ii), inserted by clause 7, which is then set out in regulation. I guess my question to the Minister is, in those areas like the Manawatū and like the West Coast where we’re not talking about the big public buildings, we’re not talking about the tall buildings, and we’re also not talking about the town centre—so the ones that are a risk for people because they are going past it for work—but those buildings which are rarely used, and the risk to life and limb, if they are happening to be used, say, by a wedding at a time when there is an earthquake in the context of, say, something like the West Coast where we are talking about areas near the Alpine Fault and the Buller fault systems, and there is a pretty broad seismic risk there, is it the case that the regulations will decide whether a group of 30 people at a wedding who might or might not use it on any given day is an adequate risk for that building to need to be remediated? Because I think that is the answer, and that does seem to be a pretty big departure from what the old rule was.

Thanks, Madam Chair. Just to the point there, no, it isn’t a significant departure. Again, it’s really down to the specifics of the individual building. I think the question before was around churches, and again, remediation is going to depend on location, height, construction type. Again, that’s applicable to any of these circumstances. Again, height is noted as to that point. There was a question previously, and this is where we’re sort of jumping ahead, around notification of requirements—all of that is set out in future new section 133AU(2), inserted by clause 7, on page 29, which is well ahead of where we are at the moment, but just to the member’s points around that.

In regards to new section 133AD on page 12, the follow-up, just to the other member’s question in regards to that, is this is so the earthquake-prone building methodology will apply across the medium and high seismic zones. It will also depend, as I’ve noted just before, on the specific building, not the region. Therefore, the question was asked previously around, well, what happens if there’s inconsistencies between local government in that aspect? The reality is that territorial authorities should apply that consistency across the board.

Thank you, Madam Chair. This is my first contribution in this debate and I’m just intervening here at new section 133AF, inserted by clause 7, and I’ll speak to some of the tabled amendments. One of the tabled amendments my colleague Tamatha Paul has moved, and it’s about the need for a cost-share scheme to provide financial assistance for the completion of seismic work, particularly on multi-owner residential earthquake-prone buildings.

When we spoke to the previous Minister about the changes, there was always, I think, an understanding that in other jurisdictions, when they lift the seismic code, there’s usually some form of financial assistance. In this case, while a significant number of buildings are no longer going to need remediation, there’s a large number of multi-residential buildings in Wellington, in my electorate and my colleague’s electorate, that are going to have to remediate the building in order to meet the new rules, and I’m just wondering if the Minister for Building and Construction—I mean, so far in this legislation, I know there’s other ways to do it and it doesn’t have to be done through legislation, but what work, if any, has been done to consider what financial assistance could be available to the owners of homes in those buildings?

My colleague has tabled a number of amendments. Both she and I have a large number of constituents who’ve reached out to us who, unfortunately, are not any better off, I guess, as a result of these changes, because they are not going to be able to borrow in order to complete the works. Could the Government at least be considering some sort of loan scheme, if not a grant scheme? I think a combination of grants and loans would be super helpful to enable those buildings to be remediated and compliant with this legislation.

I’ll come back to that. No, I’ll answer that directly. The reality is that any financial assistance, or potential financial assistance, is out of scope for this bill. It is a matter for Government to consider in the context of whether they are willing to get involved in that or not, but it is their role and not part of the scope of the bill. I’m acknowledging that is a matter and is an issue for your constituents, but for the purposes of this, that’s where it sits.

Thank you, Madam Chair. The bottom of page 13, this is the reference into schedule 2A, which, as we know, is that kind of static image that we’re all familiar with, the colours there—[Holds up map] But what we see is the Minister for Building and Construction’s Amendment Paper 702 basically striking out the reference in subclause (2) and then reinserting it in a much more elaborate fashion as the new section 133AEA, inserted by clause 7. One of the changes, Minister, that you are seeking to make is to remove the map that shows the boundaries of each territorial authority’s district. Now, that is not replicated in your new proposal in new section 133AEA. Is this sort of because of the Head Start process in terms of not wanting to have current boundaries for territorial authorities? Oh, there’s a smile coming through, so maybe that is the case. There’s non-verbal confirmation perhaps. That’s the first part of my question, that that has been removed and it is not inserted anywhere else; that is a change, so why is that?

The second question is that the new section 133AEA talks about maintaining the digital version of a map, so that implies to me that there is still going to be a static image of a map somewhere. OK, that’s good, because I was going to say, well, where is that going to be?

CHAIRPERSON (Barbara Kuriger): So that’s a yes?

💬 Hon Simon Watts: Yes.

CHAIRPERSON (Barbara Kuriger): OK. I’m just trying to capture for Hansard because a nod doesn’t quite get captured.

Oh, right. Verbalise that, thank you. Member holding up static image; placing down static image; three colours on it.

The other question that I have is that one of the things that the Transport and Infrastructure Committee did think about was the—and we’ll accept that it doesn’t have very often, but from time to time there can be some geological change that might alter some aspects of the seismic zones and some of the maps, not wholesale, but there might be a few tweaks from time to time. Now, the digital version is seeking to allow a zooming in of an individual property, so an individual property, you can understand exactly what that looks like. Is the intention that, in digitising it, if there are changes, that those changes would be automatically updated? And if so, how does that align with the static version of the map? Or is it intended that, over time, there would only be a digital version?

Madam Chair, we’re back to new section 133AB(6)(C)—oh no, are we? Anyway, short answer is that maps are going to be digitally available online and you’re going to able to zoom in, so there’s no conspiracy theory around Head Start or any of that, I can assure the member. You’ll be able to go in and zoom in and you’ll be able to see the boundary and that aspect. In regards to the updating of that, I think, as you’d appreciate, there is a process for it to be updated on a regular basis, but I wouldn’t go as far as saying it’s sort of real time or anything quicker than that, but there’ll be process and procedures to ensure that this is as up to date as possible.

💬 Arena Williams: Madam Chair.

💬 Dr Lawrence Xu-Nan: Madam Chair. Ha, ha!

CHAIRPERSON (Barbara Kuriger): I’ll let you get away with that trick.

💬 Glen Bennett: She was stretching. Staying awake.

CHAIRPERSON (Barbara Kuriger): Yeah, I’ll let you get away with that trick at almost 11.50 p.m.

Madam Chair, I do have a funny hip. I want to ask the Minister for Building and Construction a relatively simple question, I think. In new section 133AF, at the top of page 15, his definition here is a bit different to the old law. That might be because of what has already been done, though. Under the old formulation, the definition of “priority building” was much, much broader. It included certain hospitals, for instance, emergency management buildings, shelters, and the kinds of things that you might want to be fully functioning as public buildings in the event of an earthquake. Those were also prioritised for remediation. Specified education buildings were also included in that. The first question there is: is it because they’ve been done, because a number of the hospitals, say, have already fully been completed, or is that a change in policy? That is the first question.

The other question is—and it might relate to this, or it might not—where the role of the territorial authority includes identifying which buildings might impede a transport route, is it looking for those buildings which are also outside of its control? Is it expected to nominate public buildings, or can it also notify private building owners of the risk here? The question is about those strategically important routes which are affected by public buildings, say, in Wellington. That is a key consideration of those buildings, like the Stats NZ building, where there is also a bit of hazard around, say, a territorial authority needing to identify its own buildings for priority remediation, which attaches to it the shorter deadline of the 7.5 years. I’m also asking there whether there is any form of independent check as well, if territorial authorities are not identifying those buildings, which most affect their balance sheets

Thank you, Madam Chair. I think that my colleague Arena Williams’ questions are really interesting, and I would love to hear the response to that. I am going to ask a couple of questions around new section 133AF(1), at the top of page 15. Can I check with the Minister because, again, we’ve now seen an insertion, and previously we saw a definition, of “medium seismic zone” that was previously an area of low seismic risk. But, over here, we have “priority building”. With this new addition—and I think my colleague Arena Williams just pointed out the questions around “priority building”—it is important for us, I think, to know, with that, again, narrowing of the definition, how many buildings would not then be captured as a result of that updated definition.

But also, since we’re discussing seismic zones and low and medium and high seismic zones and apparently you can determine something that is now a different zone to what it was previously zoned, this might be a really basic question: who determines seismic zones, and how often do they get updated?

💬 Arena Williams: There he is. Madam Chair.

The Minister is just getting some advice.

CHAIRPERSON (Barbara Kuriger): OK, that’s fine. No, I’m just looking at the time, wondering if you wanted to wrap for the night.

💬 Hon Simon Watts: No.

CHAIRPERSON (Barbara Kuriger): OK—Arena Williams.

I’d love to wrap up, Madam Chair.

CHAIRPERSON (Barbara Kuriger): You want to wrap up?

No.

CHAIRPERSON (Barbara Kuriger): That would be great.

It’s a quick question. It is a very good point that Dr Lawrence Xu-Nan raises, because the insertion here of “medium” in the definition of the seismic zones here—how many are there? This is something that I’ve asked the officials several times. Are there any priority buildings that would otherwise be priority buildings but for the exclusion of Auckland? I’m sure there are. They won’t tell me. Why won’t they tell me? Are there buildings in Auckland which are unreinforced masonry, which may be a risk to the public, which, but for the political exclusion of Auckland, would otherwise be priorities?

It’s only because there was the anticipation. I was actually wanting people to come back tomorrow morning so they could hear the answer. But, anyway, I’ll answer it now. In regards to the question around the hazard models, so the national seismic hazard model is managed by GNS—I think there probably might be a new name now, but anyway GNS; we’ll call it that—and the new map includes—

💬 Glen Bennett: Call it whatever you want.

Sorry, it’s 11.55; my apologies—includes the latest science. Just in clarification to the point before around the maps and the updating of the maps, it is only Parliament that, actually, can make a change in regards to those, and that’s because of the certainty of where those boundaries are. I just want to clarify the way in which I answered the question before.

CHAIRPERSON (Barbara Kuriger): Members, the time has come for me to leave the Chair. The House is suspended until 9.00 a.m. tomorrow.

Debate interrupted.

Sitting suspended from 11.55 p.m. to 9 a.m. (Saturday)