Weathertight Homes Resolution Services AMENDMENT Bill

Hon CLAYTON COSGROVE (Minister for Building and Construction) Link to this

I move, That the Weathertight Homes Resolution Services Amendment Bill be now read a second time. Firstly, I thank the Social Services Committee, especially its chair, my colleague Georgina Beyer, for the thorough work that she and the committee have undertaken in respect of this bill and for enabling the bill to be reported back to the House before Christmas. I also thank the submitters for their valuable input and feedback on the bill. I take this opportunity to remind the House briefly of how this bill came about and of what it contains, and to summarise the select committee’s recommended amendments.

The bill improves the effectiveness and efficiency of the Weathertight Homes Resolution Service through reform. It is essential to the Government’s commitment to provide a speedier, low-cost alternative to the court system for resolving leaky building claims. The Weathertight Homes Resolution Service was set up in 2002 as a call to arms by the Government to deal with a major problem in our communities. This problem was not caused by any one factor; rather, it was a systemic problem caused by a large number of factors but primarily, and in large part historically, by the deregulation of the 1990s, which let the cowboys into the system and allowed them to run amuck within the building industry. In August 2005 a major review of the Weathertight Homes Resolution Service was undertaken, which found the service wanting in several areas and the process being unnecessarily drawn out by lawyers and other experts.

The bill will help the owners of leaky homes to settle their disputes faster, hold those responsible—that is, the liable parties—to account, and get compensation from those liable parties to fix leaky homes faster. It will also enhance consumer protection for homebuyers. In developing these changes, we consulted widely with organisations, including the Leaky Homes Action Group and the Consumers Institute of New Zealand, as well as building industry organisations and local government. Their collective input, I have to say, was invaluable in developing the policy that underpins this bill.

As I have said, the bill aims to improve the efficiency and effectiveness of each stage within the Weathertight Homes Resolution Service’s process. The reforms include allowing claimants to claim for potential as well as actual damage, more comprehensive assessment reports that can become expert evidence, thereby cutting down legal costs substantially for claimants, and faster resolution of disputes through the introduction of compulsory pre-hearing conferencing for standard claims before claims move to time-limited mediation, plus the fast-tracking of low-value claims. The bill sets the objectives for a less adversarial, more investigative, and swifter adjudication process. The bill introduces new offence provisions, with fines attached to behaviours such as failure to comply with an adjudicator’s order or summons. That will help adjudicators to get on with the job. The bill also seeks to make the adjudication function independent of the Department of Building and Housing. The Ministry of Justice will be responsible for establishing and administering the new Weathertight Homes Tribunal. These measures will enhance consumer and respondent confidence in the adjudication service, improve acceptance of the authority of the adjudicators, and provide more institutional support for the adjudicators themselves.

The bill removes the obstacles encountered by bodies corporate that wish to bring claims for multi-unit apartment complexes, by setting voting thresholds that are not unanimous, so that the so-called hold-out situations are less likely to occur. That is especially important given that around 70 percent of claimants with the Weathertight Homes Resolution Service are unit title apartment owners.

This legislation was introduced to Parliament on 23 August this year and received its first reading on 31 August. The House set a shortened report-back date for the select committee. The committee has met that deadline, and I am grateful for that. I thank members for their effort. The goal of having this bill passed before the end of the year and the reforms in place by April next year was ambitious, but with the support of the committee and this House today, I believe we will get there. Submissions made on the bill represented individuals, consumer groups, insurers, the industry, and organisations that represented many individuals. All of the submitters who asked to be heard by the committee were heard, and there was general support for the majority of changes the bill proposes. There was unanimous support from the select committee for the bill as a whole. However, I will come to some points later.

One change made by the committee was to extend the land information memorandum—or “LIM”—notifications to existing claims. The committee sought to extend consumer protection by including existing claims—not just those claims made after 1 April 2007, as was originally proposed—on the land information memorandum reports. The committee also agreed that the Weathertight Homes Resolution Service will send a notice when a claim is brought, instead of after it has been decided it is eligible. That is the best way to ensure people do not withdraw from the claim process and onsell their property, without disclosure, to unsuspecting buyers. The bill reflects and enhances current practice by territorial authorities.

Other changes include a provision that where a claim is determined to be ineligible under one provision, claimants can withdraw and bring back the claim under the correct provision, provided it is submitted within 1 year. That will help claimants who are close to the 10-year limit for filing claims with the resolution service. Other changes include enabling the Chief Executive of the Department of Building and Housing to access information about mediation settlements for research and evaluation purposes; appointing a registrar for the new Weathertight Homes Tribunal; allowing settlements made by the resolution service to be enforced in the District Court; appointing additional adjudicators to complete any claims remaining under the previous system; and amending the commencement date to 1 May 2007, or earlier, by Order in Council. I have to say that is a backstop provision. The Government intends to meet its commitment to claimants that the enhancements to the resolution service will be implemented by 1 April 2007.

Some additional issues, which were not part of the bill, came up during the select committee consideration and were considered carefully. The committee decided unanimously that the 10-year limitation period, which applies right across the building sector, will remain in place. It decided, by majority, that legal costs should not be able to be claimed under the resolution service dispute resolution process. The committee took on board the comments made by submitters that it should make the bill more accessible in terms of using plain English and grouping related provisions together. To that end, the committee therefore decided that a new bill was needed, incorporating the amendment bill into an integrated new bill.

The Government agrees with all the recommendations of the select committee. The Government is also putting forward Supplementary Order Paper 83, which deals with technical amendments to the new bill to improve its readability, correct minor errors, and ensure provisions are consistent across the various types of claims.

To conclude, the bill as reported back proposes, in my view, a large number of positive changes. Not only will the legislation improve the speed and efficiency with which weathertight homes claims can be dealt with, it will also reduce evidential and legal costs for claimants and respondents, reduce bureaucracy, and be fairer for both claimants and respondents. I again thank the select committee and my colleague Georgina Beyer, the chair of the committee, for the cooperation they showed to ensure the bill met the report-back deadline. With the indulgence of the House we can have it passed today, and thus enacted before Christmas.

Hon Dr NICK SMITH (National—Nelson) Link to this

This bill does contain some small and useful improvements in the process for settling leaky home claims, but if members believe that this is the solution to this billion dollar - plus problem, they are kidding themselves. I want to recite for this House the appalling record of the Government in dealing with this problem, which is so adversely affecting the life and the biggest investment of thousands and thousands of New Zealanders.

Let us first front up on the issue of just how much the Social Services Committee has changed the bill. Whereas the Minister introduced a bill of 42 clauses, the select committee is proposing, as stated in the commentary on the bill, that it would be better to omit clauses 3 to 39. In fact, the only clause proposed by the Minister to have survived select committee scrutiny is the title clause. That is failure by anybody’s standards, but I am not surprised. If we recite back to the end of 2002, this Government, in a knee-jerk reaction, rushed through legislation passing the Weathertight Homes Resolution Services Act. That legislation never went to a select committee. It was before the House for only 2 weeks, and here we are again, 4 years later, under urgency in Parliament, ramming through legislation to fix this problem. I say to the Minister, the Hon Clayton Cosgrove: “You have learnt nothing.” We know that the first Act was a failure; his bill as much as admits that. So why would he, a second time round, under urgency, attempt to try to come up with another solution and rush it through?

Let us just look at the record of the Government’s Weathertight Homes Resolution Service. To date, in the last 4 years, there have been 3,800 claims. Since Clayton Cosgrove has been the Minister, 184 claims have been settled and there have been 437 new claims. I tell the Minister he is going backwards. Over twice as many new claims have been lodged since he has been the Minister, compared with the claims that have been settled. But the real scandal is this: the average settlement has been just $68,000 for the homeowner to try to fix the leaky home. For each of those settlements the Government has spent $96,000 on bureaucracy, on reports, and on the Weathertight Homes Resolution Service. I say to members of this House that it would have been better to send a straight cheque of $96,000 for each of the claimants than it would be to fund the bureaucracy and the failure of this particular agency.

Then we have this ridiculous game of “pass the hot potato”, within the Government. We have had seven Ministers in 7 years in respect of this problem of leaky homes. We had Mark Burton. He passed the problem to George Hawkins. George Hawkins passed the problem to Lianne Dalziel. Lianne Dalziel passed the problem to Margaret Wilson. Margaret Wilson passed the problem to John Tamihere. John Tamihere passed the problem to Chris Carter. And Chris Carter has now passed the problem to Clayton Cosgrove.

Can anybody in the Government, and particularly the Prime Minister who is responsible for allocating portfolios, tell me how it helps any of these desperate homeowners to have this problem passed from Minister to Minister? But the Government has not stopped even there. The problem has passed not only from Minister to Minister but from department to department. The problem started off as being the responsibility of the Department of Internal Affairs. Then the Government decided that, no, it should not be there, that this problem should be with the Department of Building and Housing. Now the Minister is telling us that the Government is going to pass it on to the Ministry of Justice. Well, I have to tell the Minister that homeowners have had a gutsful of this problem being passed from one to another without solutions, and doing so again will not make any material difference. Then we have, not surprisingly given Clayton’s previous job as a—

GEORGINA BEYER (Labour) Link to this

It is a privilege to rise at the second reading of the Weathertight Homes Resolution Services Amendment Bill. As chair of the Social Services Committee, may I acknowledge the general cooperation from all of the committee, frankly, to process this bill speedily. I particularly thank the officials from the Ministry of Justice, the Department of Building and Housing, and the Parliamentary Counsel Office for the intense amount of work they had to do in a relatively short time.

The committee received the bill on 31 August and the closing date for submissions was 6 October. We received and considered 27 submissions from interested groups and individuals, and we heard 23 of those submissions. There was great sympathy as we heard the submissions, particularly those from people who were direct victims of the leaky home problem. The committee was very resolute in its decision to process this bill as quickly and expediently as possible but not by doing a once-over lightly.

It was also an advantage to have on the committee a member, in the form of Paula Bennett, who had actual experience of the leaky home problem. To Ms Bennett’s credit she declared that possible conflict of interest, but it turned out to be helpful to have someone who had that experience, and she brought to bear that particular perspective without it prejudicing in any particular way the committee’s decision. So that was helpful.

The member who has just resumed his seat waxed lyrical—it was a typical filibuster speech from Nick Smith—and highlighted all the problems and issues the Opposition wished to debate, but he gave not one idea as a solution. Perhaps we may be enlightened further on. The basis of what has happened occurred over the 1990s, in particular, and up to recent times. This Government has indeed progressed the issue, no matter what feelings of derision the Opposition may have about slowness. The Opposition may say it is not enough—it is never enough—but it is more than we had before.

One of the important aspects decided by the committee was simply that the bill would supersede the principal Act. The bill as it has been returned to the House will now become the primary Act, as opposed to an amendment to the primary Act. That is quite major, and a lot of work had be done by various officials and the Parliamentary Counsel Office, in particular, to get that rewrite—for want of a better term—completed so that we could process the bill as quickly as possible.

The committee gave an undertaking to submitters, particularly in the final hearing but generally to all, that we would report this bill back by 4 December. Indeed, we happened to report it back a week earlier than that. That, I hope, highlights the commitment the committee had to seeing it happen. All that is left now is to hope that the bill will proceed expeditiously through its Committee stage and third reading, and be completed by the end of today’s session. With that, I thank you.

SUE BRADFORD (Green) Link to this

The Green Party continues to support the passage of this Weathertight Homes Resolution Services Amendment Bill as it progresses through its final stages in the House today. Although submitters to the Social Services Committee were, on the whole, quite critical of the inadequacies of this and previous relevant legislation, at the same time there was an overwhelming indication that it is better that the Government do anything it can to improve, streamline, and speed up dispute resolution processes on this issue, rather than just leave things as they are. Some of the submissions were quite harrowing, coming from people who had lost everything or almost everything through ending up stuck with an expensive home that had lost almost all of its value, and without recourse to anything like the amount of compensation—if any at all—necessary to fix their problems. I think every member of the select committee, no matter what political party he or she came from, felt tremendous sympathy for such people, of whom of course those speaking to us represented just a tiny fraction.

Over and over I thought back to what it was like in Auckland in the 1990s, and reflected on those massive developments that we saw going up all around us at the time. I will never profess to being an expert on building materials or construction issues, but even so I remember how at the time I was totally suspicious about the nature of so much of what was being built. So many of those new housing developments looked inadequate and shonky, and ill-suited to the wet reality of Auckland’s weather. They were real disasters waiting to happen.

We heard a lot about culpability and blame during the select committee process, and I certainly do not think it can be sheeted home in any one place. Overall it seems, in retrospect, that a big part of this sector in the 1990s was blighted by a blindness to the reality of what construction types and materials work in our climate, and by a drive to profit at any cost in the excitement of a newly deregulated market place. In 2002 the Hunn report named this as a major systemic breakdown across the whole building industry. After hearing the submissions on this bill and the desperation of so many homeowners and local authorities caught out by what has happened, I can only agree. Instead of using the tremendous growth in building developments in the 1990s as an opportunity to learn and put into practice sustainable building techniques for the future, the opposite happened, with results that affected and desperate homeowners are still having to live with today.

Within this context the bill before the House this morning is welcome, with its focus on improving the system for resolving leaky building claims submitted to the Weathertight Homes Resolution Service. The Green Party supports the substance of what is being achieved here, including the goals of reducing the time it takes for claims to be resolved, thereby cutting the costs for homeowners in taking claims; encouraging the resolution of disputes through early negotiation between parties as much as possible—especially for lower value claims—and removing some existing barriers to the registration of claims and resolution of disputes by owners of units within multi-unit apartment complexes. We believe that it is critical that the existing resolution service processes are improved, so that in the end people’s homes can be repaired more quickly and the associated trauma brought to an end with as much speed and as much support for the homeowners as is practicable.

I know that this bill is not perfect, but I think it is incumbent upon the Government to do what it can. A huge range of complex issues were brought out by this bill, and the select committee process was notable for me in being the first time I had seen the situation arise where an amendment to a principal bill was so complex and confused that in the end counsel had to redraft and amalgamate the whole bill into a new Act. On top of that, a number of amendments were made during the select committee process in response to submitters and to the committee’s consideration of the bill, and even further amendments have since been put up by the Minister for Building and Construction, to be dealt with by way of a Supplementary Order Paper today. Some of these changes, which we support, include the extension of land information memorandum notifications to existing active claims already in the system, a requirement for claimants who bring a new claim under different eligibility criteria to do so within 1 year, which provides certainty as well as allowing claimants to extend the period within which they can bring a case, and the provision of clarifying clauses and a useful diagram in schedule 2 to help make the process clearer for all concerned.

When I originally spoke on this bill I was, like many submitters, concerned about the 10-year limitation period, which means that any leaky building claim must be brought within 10 years of the home being built or altered. However, after learning more about this issue during the select committee process, I have come to understand and accept that for the most part there are good reasons for this limitation, including the fact that it is very hard to determine liability after 10 years, that it is difficult, if not impossible, to collect adequate evidence after such a long time, and that it is a provision that already applies to other claims in respect of building work. On top of that, we were told that research and the Hunn report itself show that if there is a problem with a home, it should be showing signs of it well within the 10-year time frame, and that it is actually better for all concerned if people make their claims as soon as the problem appears.

Another big issue for claimants, for which I have a lot of sympathy, is legal costs. It has been, and continues to be, almost unreasonably expensive for people, even comparatively well-off people, to take claims when legal counsel are involved and are up against lawyers representing every other party. My hope is that the simplification and speeding up of processes implemented by this bill will help to reduce those costs markedly, if not altogether—the latter particularly in respect of lower value claims.

One suggestion from submitters in which I was particularly interested was the concept of setting up a special court for building issues, as exists in the UK. I could see a lot of merit in this suggestion, not only for dealing with the ongoing leaky homes crisis but for acting in future as a specialist building disputes service within the court system overall. Although the select committee did not see fit, or feel able, to support that proposal at this juncture and decided to leave the service as a weathertight homes - specific disputes tribunal, I am keen to learn more about this concept of a building court and to work with parliamentary colleagues and people involved in this sector towards a possibility of implementing such a court in future.

In conclusion, like the committee chair, Georgina Beyer, I thank all those who have worked on this complex bill, including my fellow select committee members, and particularly the officials, who put in an enormous amount of work under considerable pressure of time. Above all, I would also like to thank the submitters from all backgrounds who took the time to put together often very useful and detailed input to this legislation, and to express on behalf of the Green Party my sincere hope that the passing of this bill will lead to the achievement of its goals as soon as possible, for the sake of everyone concerned.

TE URUROA FLAVELL (Māori Party—Waiariki) Link to this

Tēnā koe, Mr Deputy Speaker. Kia ora anō tātou katoa. A couple of years ago a Labour Minister Dover Samuels spoke out about the lack of progress in addressing housing in Northland, Eastern Bay of Plenty, and on the East Coast. I absolutely agree with that member. His comments came following the tragic blaze at Herekino, which claimed the lives of three children. The comments sat in the context of local general practitioners telling of cases where infections such as meningococcal disease were being spread because of sub-standard housing. This was a time when people were living with no flushing toilets, no bathrooms, and no septic tanks. In some homes, toilet waste was being poured straight into the ground, inviting hepatitis A. His comments were based on Labour’s promise to fix 2,500 houses, but over a year later, work had started on only about 250. This was, and still remains today, the situation for too many Māori families.

I know how real these issues are throughout my electorate of Waiariki. Indeed, just last month I visited Rūātoki. I visited houses in poor condition, reflecting low-quality workmanship. Many of them were rotten and leaking. When one house was removed last month it was evident that raw sewage remained. The houses are in a state of disrepair. They have been described as polyurethane Weet-Bix. These are not isolated cases. I am also aware that the community of Waitahanui in Taupō, located in papakāinga housing, has suffered much the same plight as the result of housing being planted on swampland, and the impacts of the low water-table. I know of one family forced to live in their sitting room, due to the mould and the damp in the other rooms.

What does this have to do with the Weathertight Homes Resolution Service? Everything, and nothing. The Weathertight Homes Resolution Services Amendment Bill has everything to do with addressing the leaky buildings crisis. It has everything to do with considering the wider scope of claims for weathertight deficiencies—deficiencies that cause real damage, but as yet there have not been leaks. Sadly, it has nothing to do with the deficiencies and damage that are still very much a part of the lot of those involved in the Māori housing story.

For evidence of that, one need only turn to a report released in August of this year from Charles Waldegrave, Peter King, Tangihaere Walker, and Eljon Fitzgerald. This was a joint collaboration between the Family Centre and Massey University. The report, Māori Housing Experiences: Emerging Trends and Issues, outlines in some 218 pages the following conclusions: “Homeownership rates for Māori are lower than for the general population and have been falling since the 1950s … Overcrowding, substandard housing causing health risks and inadequate heating have been identified as issues in need of attention for Māori. Economic conditions and family structure have affected the ability of households to afford adequate accommodation.”

I come to this bill aware of Standing Order 107 and the need for all debate to be relevant to the question before the House, and I ask this House how any member could possibly ignore the realities of lower-grade housing for Māori when we are considering a raft of proposals to enhance the assessment and resolution of leaky building claims for other New Zealanders.

Let me be quite clear: the Māori Party supports absolutely the objectives of this bill to ensure that departments responsible for administering the legislation will be helpful to claimants. We believe that the public service is honour-bound to provide a service to the public that is efficient, respectful, and responsive. We welcome the specificity of providing guidance and assistance to claimants to help them to understand their assessment reports and to be aware of the advantages of early negotiation, and to make the process faster and less costly. Surely, these are the hallmarks of a transparent and accountable public service—that every effort is made to improve processes and to enhance case management.

We are also pleased that the bill actually tries to do something about the recommendations from the 2002 Hunn report and the 2003 Government Administration Committee inquiry. The Hunn report identified the factors that contributed to leaky buildings, and issued 25 recommendations to address the systemic failures within the building industry. The Government Administration Committee inquiry resulted in some 63 recommendations, notably the significance of the development of consumer protection measures. So all up, 88 recommendations later, we have a substantial body of evidence about the need for speedy, flexible, and cost-effective procedures for the assessment and resolution of claims.

Who could possibly argue with initiatives that try to improve protection for customers, such as is envisaged by placing notices of Weathertight Homes Resolution Service claims on land information memorandum reports, or the fact that the service will provide free assessments to determine the extent of water damage to affected homes, and will provide access to mediation and adjudication services to help resolve disputes? Certainly not the Māori Party, anyway.

We support the establishment of a new Weathertight Homes Tribunal to provide strengthened adjudication services for consumers, and we support the intention for the model of dispute resolution to be based on a more investigative approach. We believe that the proposals seem comprehensive and will do much to clean up the deregulation of the building industry.

But I return to the concerns raised by Mr Samuels—the report I outlined earlier. To put the call—when will one standard of law also apply in the case of Māori housing? The study of housing experiences I referred to earlier builds on four crucial elements: literature review; analysis of census data; analysis of data from the Te Hoe Nuku Roa, a longitudinal study of Māori households; and qualitative field study. The qualitative sample included six regions, involving 70 people and eight focus groups. It was a very strong source of support to provide a basis on which to develop housing options for Māori from now on.

The question we would ask is how this Government can justify spending $76 million on the Weathertight Homes Resolution Service since 2002, yet turn a blind eye to the fact that New Zealanders are squatting in shacks and caravans, that families are squeezed into pensioner flats, and that there are over 2,250 run-down homes on the sub-standard list. The Māori Party housing policy makes an explicit commitment to ensuring that Māori housing experiences and realities are adequately researched and addressed. The study I have referred to in the House makes a significant contribution, we think, towards this goal. We believe that we must engage and encourage Māori participation in order to produce enduring housing solutions. We support the Weathertight Homes Resolution Services Amendment Bill, but we also place on record the urgent and ongoing need to make sure that the issues associated with Māori housing are given the due and serious consideration that they deserve. Kia ora tātou.

PAULA BENNETT (National) Link to this

Thank you for the opportunity to stand and speak on this Weathertight Homes Resolution Services Amendment Bill. I am the person whom the chairperson of the Social Services Committee was talking about earlier who actually has a leaky home. I start by acknowledging that and by saying that we have chosen not to use the service because the building is a multi-unit. We are taking the matter to the High Court, because we felt that the service was not capable of addressing our needs, and we certainly still feel that way.

Unlike the Minister, I would like to do more than just pay lip-service to the submitters and the thousands of people out there who came to us with personal stories and who stop us in the street to talk about the effect this issue has had on their lives. They are truly the blameless victims. In many cases they have invested everything they had to try to have a home that they could live in and pay their mortgages on. They went forth in all good conscience to do the right Kiwi thing, and now find themselves in financial ruin and absolute emotional distress. They deserve to be acknowledged, and acknowledged properly by this House—not by the tinkering that is currently being done with this bill. This bill does not work for anyone, and we have heard that time and time again. It does not work for the councils and ratepayers, it does not work for the builders, it does not work for those who sell building products and who have got it wrong there, and it most certainly does not work for those homeowners who find themselves in this predicament.

Like my colleague Dr Nick Smith, I was appalled when I looked up the numbers yesterday and found that, to date, only 7.6 percent of claims have been resolved. I stand here and, as politicians, I feel that the few changes that are being made are being done just so that Government members can stand up and say that they are actually doing something. In particular, the Minister can now walk around and say that the Government has tried to fix the issue by trying to speed up the process and trying to make it more efficient. The words that kept springing to mind when I was listening to Sue Bradford give her speech were “I hope”, and I also heard from the Māori Party “We hope”. We hope that this bill does something for the homeowners, but we do not have faith that this measure is what is needed.

It is the sort of thing we have just so that a politician like the Minister can sit there and feel better. People may have seen him on the telly a little while ago, where he squirmed when he was faced with those personal stories of financial ruin and when he was faced with the emotional stress. Now what he has done is to put forward a bill that tinkers around the edges of the problem. It does a little, but it does not do what is needed to be done, which is a lot. This is an “Avoid Bill”; it avoids the realities of what is really happening to New Zealanders, it avoids the total reform that is needed, and it avoids the fact that this legislation is merely tinkering around the edges.

PITA PARAONE (NZ First) Link to this

Tēnā koe. On behalf of New Zealand First I say that we will certainly support this bill, notwithstanding some of the comments that have been made by people who sound as though they are actually opposing the bill, and yet whose friends—and even the member Paula Bennett herself—will certainly become beneficiaries under this legislation.

There are a number of reasons why we support this bill. Firstly, we heard from a previous speaker that there were 3,800 claims, and that 134 have been settled, but that another 437 new claims have been made. I suggest to this House that it is important to have appropriate legislation that will address that particular issue. We in New Zealand First believe that this legislation will do that. Secondly, this legislation is not about providing obstacles to homeowners but rather about drilling to those who are responsible for this issue. That may include builders, developers, and even architects. Thirdly, this bill is not about poor workmanship but, more essentially, about addressing the use of poor material. We need to make sure that similar material is not used in future.

I also make the point that this bill is not about race, as some earlier comments in this House might have suggested. In fact, if Māori are affected by the leaky homes syndrome, then they have equal access to Pākehā to what this legislation will provide.

Although New Zealand First was not represented on the Social Services Committee, we want to acknowledge the fine work the committee has done. It saw that the original bill needed a replacement, as its report back has recommended. Clauses 3 to 39 will be replaced by new clauses to include all the elements of the bill and everything that is in the principal Act. New Zealand First, as I said, did not have a member on the select committee, but after having read its report we feel confident in supporting the passage of the bill though this House. We are confident that this bill fulfils its aims, which are to improve the experiences of those unfortunate enough to own a leaky home and who are seeking redress and resolution through the Weathertight Homes Resolution Service. The system now allows for a smoother and more transparent system than that previously in operation. I think that the comments made by a previous speaker certainly validate what I have said about that.

The bill addresses a number of issues and I want to comment on one or two of them, particularly in terms of the land information memorandum notifications. The Chief Executive of the Department of Housing and Building and the tribunal will be required to advise territorial authorities of all leaky home claims. It is important that any purchaser of such a home is made aware of this particular issue regarding the land information memorandum notification. Failure to do that will certainly do an injustice to people who are contemplating the purchase of such homes. Of course, there will be no delayed notifications and the information must be placed on the property’s land information memorandum.

We heard comment in relation to multi-unit claims. While I can sympathise with some of the comments made about the difficulty of getting a minimum of 80 percent approval of a particular issue, I say that what the bill has put in place is much better than what was previously there. The important thing is to ensure transparency, accessibility, speed, and simplicity for those who need to use this service, remembering at all times that those people are victims of a system in which this fiasco was allowed to happen.

Comment was made about whether it should be the tribunal system or the court system that is used, and about the fact that some homeowners may not be able to afford legal representation. At the end of the day it is the choice of the individual homeowner to decide whether he or she wants to take a claim to the tribunal or to the High Court. I suggest that those who take it to the High Court will certainly have legal representation.

There are many lessons to be learnt from the leaky homes saga, not the least of which is that we should remember, when deregulating and privatising, that the regulations were put there for a purpose. It was never in anybody’s interest, save for the sharks in the industry, to relax the regulations in relation to the building and construction industry. I trust that this sorry episode in our history is now put to rest permanently.

The commencement dates, as outlined in the bill, are certainly relevant in terms of the comments that have been made in the report. It is important that the effects of this legislation are put into action immediately. I think the suggested start date for the tribunal is 1 May 2007. Although we would have liked the date to be much earlier than that, the actual process of getting legislation into the system will require that sort of time frame.

I also noticed, with regard to the building tribunal, some submitters suggested we should adopt the approach currently being used in Britain. This bill is intended to establish a specialist tribunal that will develop expertise in leaky building cases, so that it can provide relatively timely and low-cost resolution of such disputes.

JUDY TURNER (Deputy Leader—United Future) Link to this

I rise on behalf of United Future to speak on the second reading of the Weathertight Homes Resolution Services Amendment Bill. It is a necessary amendment bill. In fact, it is more than an amendment; it is a replacement for the original Act.

United Future supports the bill but, like others in this House, we agree that it is not a cure-all for the matters related to leaky homes. We support the inclusion of relevant information on the LIM report as a positive step, although I looked back over the notes I took during the submissions and saw an interesting suggestion made that the information should go on the certificate of title, based on the fact that very few people actually get a LIM report. There are some ongoing challenges for those with multi-unit dwellings, and this amendment recognises some of those difficulties and makes a start towards dealing with those concerns.

Like others, I want to thank the select committee; it was an enjoyable working process. I would like to thank the submitters, and the officials who gave us advice.

However, the lesson does not go away with the passing of this amendment. The ongoing issues regarding housing design, building methods, and building materials remain. I still remember driving around a new housing division looking at new designs. I have a husband who is a very practical handyman, and he was not as impressed with the new designs as I was. He had some real reservations about what might happen. It sounds as if a lot of people had those kinds of reservations, and we are now bearing the consequences of some very poor thinking in that regard.

In New Zealand, homeownership has always been a bit of an excuse for low levels of saving towards retirement, and that is why the leaky homes problem has been such a crisis for those people affected. I agree with Paula Bennett that it is important during this second reading not to trivialise the suffering of people with leaky homes. Their homes represent their hard work and their future security, and for those people that has been crumbling before their eyes.

The need to deal with future potential damage came up during this amendment bill. Of course, these issues have to be balanced against the normal deterioration of natural products, like timber, in the life of a home. Forecasting is difficult, but establishing damage is absolutely pivotal to the process, and this bill seeks to better facilitate that process.

One of the other issues that comes up in regard to that—and certainly several submitters mentioned this—is the need for better education for New Zealand homeowners about the maintenance of their property. Homes do not last forever but they certainly last a lot better with a regular coat of paint, if that is the material the homeowner has chosen to use, and with some basic practical maintenance being done to them. I think there is very little education, and people often expect much greater longevity from a home than it is capable of delivering.

The issue of making sure homes are properly fixed after the settlement is one that still concerns United Future members. We think that some ongoing work on this matter should be encouraged. Certainly, the Wellington City Council, and a number of the other city councils that made submissions, had ongoing concerns about the fact that their housing stock in their towns, particularly those that had claims made against them, in some cases remained unfixed even after settlement. I think the slowness of the process up to date has contributed to that. It has meant that when people have received some compensation, much of it has had to go towards other bills sustained during the process, like legal costs, and therefore homes have remained either partially or completely unfixed. There is possibly a need to look at the joint fund currently used by local government instead of individual insurance policies being used. There is concern about the fact that that fund is fast running out.

At a later date we also need to reflect on some of the submissions from builders. They said they would like some additional clarity as to when an individual builder can be held to be negligent, as there is still a lack of clarity around that. They also asked that builders be included earlier in the claims process than they currently are. Sometimes they do not even know that a claim has been taken out against a building they were responsible for building. They believe that if they were included they could, firstly, with their knowledge of the building, throw some light on the damage occurring. They also said that if they were included at an earlier date, many of them would want to jump in and get the problem fixed before it progressed, and before there was further deterioration to the building.

I think that a number of matters that came up at the Social Services Committee warrant some further consideration. However, that being said, I believe that this is a move forward in the right direction. It is not a big enough move, but we will support it because of the good it will bring to the process.