Weathertight Homes Resolution Services (Financial Assistance Package) Amendment Bill

In Committee

Thursday 7 July 2011 Hansard source (external site)

Debate resumed from 5 July.

Part 1 Amendments to principal Act (continued)

Twyford PHIL TWYFORD (Labour) Link to this

I begin the debate this afternoon by providing a little bit of context on this issue. Many, many New Zealanders have had their lives not just touched but blighted by the leaky homes disaster over the last 20 years. Those people need no explanation about what a catastrophe leaky homes have been, but many others, particularly those who live in parts of the country that have not been badly affected by leaky homes, may not have had firsthand experience of this problem. Many New Zealanders will have seen the documentary that screened on Television One last night and was fronted by John Gray of the Home Owners and Buyers Association of New Zealand—HOBANZ. The documentary set out a little bit of that history and told the story of people who had bought homes that became leaky. It showed the enormous financial stress and emotional burden they have had to carry, and the sheer difficulty of navigating through what became a bureaucratic and financial nightmare for many of them.

The leaky homes problem has exacted an enormous toll on those homeowners, on the economy of this country, and on the building and construction industry. It has set back, by many years, the broadly bipartisan efforts to reform our building and construction industry. There is much to be regretted.

The leaky homes problem is one of the great legacies of the free-market fundamentalism that blighted this country throughout the 1980s and 1990s. We can lay the blame for this problem on a handful of measures. First, we can lay it at the door of the decision made by the Building Industry Authority, under the National Government in the 1990s, to allow the use of untreated timber in the construction of houses. There was a failure to have a proper product certification regime in place. The winding down, or the destruction, of our apprenticeship system was also a major contributor to that problem. Those things are all to be regretted, and many of those lessons have been learnt. The review of the Building Act that was begun under Shane Jones as the Minister—

Hon MAURICE WILLIAMSON (Minister for Building and Construction) Link to this

I will take the next few minutes, if I can, to address just three of the Supplementary Order Papers that Phil Twyford has put on the Table, and his typescript amendment. I fully believe he has put them forward in good faith, and he deserves for us to give a proper response, so I will take them in turn.

Supplementary Order Paper 250 seeks to reduce the protection of some people by allowing them to be joined in litigation. It could mean that, for example, the Crown could be joined in litigation, the council could be, or even other contributing parties to the proceedings could be. I want to make it clear that I do not think that that is what this legislation is about. Councils, first of all, will not participate. They have made it quite clear that if they are going to put their 25 percent contribution into the fixing of a home, they will not do that if it means they could either be brought into a litigation after that, at any rate, or be joined in a litigation at some stage later, even by way of a circuitous route. So the scheme is not about apportioning responsibility, and so on; it is about just trying to get houses fixed. If we were to accept Supplementary Order Paper 250, that would actually open up some of the litigation channels, and I think that would be a problem. It is not just about the Crown and councils; it could impact on a number of building firms that have said to me that they are dubious about participation. And these are good builders whom we need to have involved. They are dubious about involvement, but if we opened the process up to litigation, and the chance of their being joined into the greater litigation field, they just simply would not participate. This Supplementary Order Paper would change the focus of this bill to litigation rather than to fixing leaky homes, and I do not want that to be the focus.

The second amendment that Mr Twyford has tabled seeks to amend the definition of “qualifying claimant” to exclude property speculators. Although I laud the intent of that amendment, the trouble is that it goes further. It could exclude people who knowingly purchased a leaky home, even if they had bought it as something they were going to do up and live in. That is what—[Interruption] Yes, it would. That is what it would do. That is why the Government will not support the amendment. The aim of the scheme is to get as many leaky homes repaired as fast as we can. The scheme does not discriminate on the basis of who owns the home. It is intended to get the home repaired so that owners and renters can live in a safe environment. The amendment would prevent genuine homeowners, who purchased intending to repair and live in a home, from accessing the scheme. I will repeat that: they may be genuine homeowners when they see a leaky home and think to buy it, do it up, make the repairs, and then live in it, but in the way the amendment is worded genuine buyers would be prevented from doing that. So the Government will not support that one. I understand that the proposed change is grammatically incorrect at any rate, so we would need to make an amendment to that amendment.

Having said that, let us move on to the third one. Supplementary Order Paper 252 seeks to provide that the Crown will guarantee repair loans taken out by bodies corporate. In my view—and I think the officials have given me this advice—the Supplementary Order Paper is actually not necessary. The Government could choose to provide this guarantee under the existing provisions, because the existing provisions are general and do not specify the terms of any guarantee or indemnity under the provision. The reality is that some multi-unit dwellings will not be able to access this financial package—that is true. That might be the case even with this amendment, but they will always have access to the Weathertight Homes Tribunal’s dispute resolution process, which they have now.

I think that probably an important point for anyone listening to this debate is that this entire package that the Government is putting out there—with the Government paying 25 percent, the local authority paying 25 percent, and the homeowner getting a loss-sharing arrangement with the bank for a loan for the remaining 50 percent—is a voluntary package. No one has to take it. It is an attempt to try to get some homes fixed, and if people say they do not like it and do not want it, or want to resort to litigation or stay with the Weathertight Homes Tribunal’s process, then they will still have that right.

Finally, Mr Twyford’s last Supplementary Order Paper, Supplementary Order Paper 253, proposes to remove the Crown’s immunity. The Crown is making a huge contribution to this package, and does not have to. We did not have to bring this package to this House. In fact, when other people have tried to join the Crown in litigation in the past, they have never been successful because the courts have ruled that the Crown is not in any way liable. We could have taken the stance that it was not a Government liability, and I know the Labour Government took that position, rightly or wrongly, for the 9 years it was in office. If we were to remove the immunity of the Crown, not only would we be putting up what will be over $1 billion of payment in this package—possibly even more, depending on the number of people who take it up—but also we could be exposing the Crown to huge litigation risk. The Crown’s immunity in the bill has been included because, to date, the Government has not been found liable in leaky home litigation, and I think that that is the best way to keep it. Another benefit of the Crown’s immunity is that it will remove incentives for vexatious litigants trying to join the Crown. A lot of people could be vexatious and try to force the Government to be involved.

I will now talk about the Department of Building and Housing assessors’ immunity, because that is part of it, as well. Department of Building and Housing assessors have always been immune from proceedings relating to their functions under the Weathertight Homes Resolution Services Act 2006, which was passed by Labour. I understand why Labour did that, and I think that is right. Assessors’ immunity is critical for delivering a weathertight homes resolution service and a financial assistance package. Those people who are doing their job, and doing it well, should not be doing it under the threat of not having any immunity. Assessors will not perform their role if there is a risk that they might be joined in litigation about leaky homes. Although I fully understand the rationale behind all four of Phil Twyford’s proposed amendments—in fact, I sympathise with some of the rationale behind all four amendments—I say to members that it has been a very long journey to get here today.

This process started off with trying to get agreement across local authorities, and to tie this package down was one of the hardest pieces of work I have done in my 24 years in Parliament. To get not only local authorities on side but also the banks now on side, with regard to their participation in the scheme, has been a long, slow, arduous process. I have had the news media having a flick at me from time to time, saying: “He has failed to get them on board.”, or: “He has failed to achieve this.” Well, I am happy to report that local authorities are signed up to this legislation as it stands. We would lose them immediately if we made the changes that were suggested here. The banks have now signed up to the package and they are ready to go.

I look forward to getting the Committee of the whole House stage finished, and a third reading of this bill through, for constituents of a number of members of Parliament. I know that people like Darien Fenton and Lynne Pillay in west Auckland have a huge number of affected constituents, as do the members from the North Shore, Tauranga, Wellington, and Christchurch, because that is where the vast majority of these places are located. Those members are looking forward to their constituents being able to walk in and get half of their repairs paid for straight away—25 percent by the Government, 25 percent by the local authority—getting a bank loan for the other half, and moving on to getting their places fixed. I am really delighted with this legislation.

Fenton DARIEN FENTON (Labour) Link to this

I thank the Minister in the chair, the Minister for Building and Construction, for that explanation. Labour acknowledges that this is a genuine attempt by the Government to resolve what is a very longstanding and difficult problem. The Minister in the chair is right, actually, when he says that there are constituents out there who are waiting to see this issue resolved, and we have seen many of them. I have certainly seen a few in my time, even as a list MP. I have had people who are quite simply desperate come to talk to me to see what could be done to help them in their situation. There are some just awful situations. One that I will relay is about a woman—and I will not use her name, but she is fairly well known—who has authored a book. In her former life she was a nun. She went through quite a bad experience in the nunnery, left, and wrote a book about that experience and how it happened. She married, and then her daughter suffered a very debilitating, crippling illness. She spent years trying to help her daughter recover from it—and she did in the end—but her marriage suffered as a result. So she has been through the most incredible experiences in her life.

After she separated she bought a home in Albany that has turned out to be a leaky home. She said to me: “Darien, I have been through so much, but I had never felt like committing suicide until I experienced this.” It is the awful thing of living in a home that is leaky. We all know that water does the most damage, and we know it brings fungi and disease, but it also brings stress, and no speedy resolution or sense of being able to get it resolved.

So I acknowledge, as I said, the genuine attempt by the Government to deal with this problem. Most certainly we can look back—and we will, no doubt, during this debate—at the causes of the leaky home problem. We know that the previous Labour Government made some attempts to deal with it, and it tightened up some of the regulations around building, which is good to see. But one can drive around Auckland, around some of those new estates, look at the buildings and see that they have cladding, Mediterranean style, and think that they are bound to be leaky buildings.

I had the experience of going to a building site the other day with the Building and Construction Industry Training Organisation to talk to a builder who has five apprentices. The purpose of my visit was to talk to him about what is happening with building apprenticeships. I will talk about the skills gap a bit later if I get the chance, because there is a crisis, I think, as my colleague Phil Twyford has alluded to. How will we get the builders to do this work, given that we also have an enormous job to do in Christchurch? The organisation told me that there is a standard now when a house is built—there is automatically a standard. I do not know the ins and outs of building or carpentry, but there is a standard now whereby when a new bit has to be added, part of the job of the apprentices is to explain what it is, how they do it, and to demonstrate that they actually understand the importance of it. That was very, very interesting.

The other thing that was really good about that visit was it made me remember what a craft carpentry and building is—what a wonderful craft it is. This was an old home in Devonport, not a leaky home, that was being significantly overhauled. These guys are on 4-year apprenticeships. They have to do quite amazing stuff. They have to do the planning, the concrete work, and the steel roofs, and they also have to be able to do very intricate woodwork, particularly on the old-fashioned villas in Devonport. What an amazing craft. I think it is such a shame. I know there were some rogue builders, and others, who took advantage of the fact that our regulations were weakened. That was a crime—that was an absolute crime. I would hate to think that that had in any way put a blight on the occupation of being a builder, because the people I met the other day in Devonport were fantastic. They will be wonderful builders, and of course they will benefit from the work that is coming up with this bill. In fact, I was thinking that I have a bit of building at home to do and that I had better get it done quickly because I may not be able to get a builder fairly soon.

I think it is important to understand the purpose of this bill. It does not provide a whole lot of details around the scheme, or the criteria to be eligible for the contribution—that has all been thrashed out elsewhere. The legislation does not require that to be there. People listening to this debate may be looking for that detail, but it actually is not in there; the bill is really about providing immunity, which the Minister has alluded to in reference to the amendments of my colleague.

Labour is supporting this bill, and I think that during the debate we will bring up some of our concerns. I know the Minister will do his best to persuade us that we are wrong, and we are happy to listen to that, but we still believe that there are many affected homeowners who will be excluded by this package, and that is a worry—that is a worry. There will be people out there thinking that some resolution is coming, and that is not going to happen. There are still some unresolved issues around the details, and the skills deficit is an enormous concern. I know it is not covered by the bill. It is fine to deliver the money, it is great that there has been progress, and I accept what the Minister said about what a hard job it has been. In fact, if anyone could do it, Maurice Williamson could.

Calder Dr Cam Calder Link to this

Ha, ha!

Fenton DARIEN FENTON Link to this

No, I want to record my respect for him, actually. He was on the same select committee as me in the last term of Parliament. I always found that although we differed on lots of things, he was always very, very competent and capable. He is the kind of man who will just get on and negotiate.

Twyford Phil Twyford Link to this

He’s still a free-market fundamentalist.

Fenton DARIEN FENTON Link to this

He will say that—that is right; he freely admits it. But he says he is a social liberal, so, you know, there are some things that we agree on.

However, in terms of what the Minister has said about it being the hardest job he has ever done, I can see that; I can see the amount of work that has had to go into this and the enormous amount of detail, convincing, negotiation, and work that has had to be done on it. However, I would hate to see all that work put aside if we could not find the people to do the work because of the skills deficit that we have. I would hate to see that happen, and I think that would completely derail it.

One of the groups of affected homeowners I will talk about who are excluded by the package are the owners who are not found to be eligible under the legislation, and owners whose homes are more than 10 years old. How long has this leaky building problem been going on for?

Hon Maurice Williamson Link to this

Since 1995.

Fenton DARIEN FENTON Link to this

Since 1995. OK, so there will be some people, I say to the Minister, who will be excluded—he agrees with that. For those people this legislation will seem incredibly unfair. There will be owners who cannot raise the remaining sum, the other 50 percent, and that will be really difficult for them. Most of those people will be vulnerable and the most disadvantaged. They are people who have put their lives on the line to build their new house. They have put everything into it. I have met a few of them. Then, of course, there are those who are vulnerable now because of job loss. They once had two incomes and now they have one. I think they are being described as the “nouveau poor”, whom we are seeing in places like the North Shore. They are people who used to have two incomes, they have a big mortgage, and they have put an awful lot of effort into getting this lovely new house, only to have this awful tragedy—this awful situation—occur. So I am worried about them, and I am worried that they will not find any relief in this package.

And there are, of course, health implications—not only the stress that goes with having to deal with leaky homes but also the health implications of having to live in them. Some people just do not have a choice, do they? They will just have to stay in their homes. They will not have the choice to go anywhere else. So we are concerned about them.

There are some issues around the financial package, which I am sure we will talk about a little bit more. I think the amendments that have been introduced allow discussion for that. It is good that the Minister has given an early response up front, and I am sure Phil Twyford will have quite a lot to say about those issues.

Finally, as I said, my major concern is the issue of being able to get the work done—being able to find the builders to do this work, particularly when there is such a huge amount of work to be done in Christchurch. I think a whole lot of blame can be lumped on a former Government in the 1990s that ditched the apprenticeship scheme and did away with skills training, and that is what we are reaping now. It is good that we have young people coming through, but what a builder said to me the other day, and what the Building and Construction Industry Training Organisation said to me, is that they cannot find builders who will take on apprentices. So the skills shortage is something that I am concerned about. We hope that all of the hope that this bill offers, and all the work that has gone into it, is not wasted because of a skills shortage and the work not being able to be done.

Hon MAURICE WILLIAMSON (Minister for Building and Construction) Link to this

I will not do this all the time, but I think Darien Fenton has raised a really interesting element of this bill that I want to cover, and that is the 10-year limitation. I need to make it clear to people who have a leaky home—and we made this clear when we announced it a year ago, in May of last year, which is about 15 months ago—that if they have a leaky home and they are coming towards the end of its 10-year cycle, all they need to do is to register with the Weathertight Homes Tribunal and the clock stops.

The reason there is such a limit is simple; it is the numbers. The dollars make one’s eyes start to water if it is left open-ended. I fully understand that as soon as we draw a line in the sand, there is always a person just on the other side of that line who will feel aggrieved. If we said that we will make it 11 years, then the person who is at 11 years and 1 month will feel aggrieved. It would be the same if we made it 12 years. If we do not make any limit, then we start to basically gut the intention of the original Building Act, which states that there is a period of 10 years—it is actually in the Act—within which a building must be fit for purpose, and so on. I am sure members of this House will know that a lot of their constituents, and maybe even them, will seek to do renovations after 12 or 14 years. They may redo the bathroom, and so on. So we cannot leave it open-ended, and if we did it would simply be fiscally not achievable. Therefore, we decided to keep the 10-year limitation that is in the Building Act to make sure that people can stop the clock. I repeat over and over, for anyone out there today who is listening, that if they are worried that they are coming near their 10-year time frame they should go and get registered. It does not take much, and once that claim is registered, whether or not it is valid, whether or not it comes to fruition, and whether or not this package is accepted, the clock will stop for that person and they will be through the gate.

There are a number of other things about the package that I would have loved to do differently. One of them was that for a number of superannuitants their concern was that if they have to get a 50 percent loan from the bank, it will be very hard for them to make that repayment. I fully understand that, and we explored an option of allowing for the Crown to pick up the 75 percent, not the 25 percent—the local authority does the remaining 25 percent—then the Crown would get back its 50 percent from the estate on the death of that superannuitant. But again that just becomes numbers that go into the billions. Let us remember that PricewaterhouseCoopers estimated that there is $11.3 billion of damage known, and it is estimated that over time, in places with a slower rainfall and moisture level, this number could end up being double. We could see $22.6 billion of damage. It puts it into perspective relative to the Canterbury earthquake, which is about $15 billion. It is a ginormous sum of money.

I make no secret of the fact that 101 different combinations and permutations were looked at to try to get this through. We looked at one-third, one-third, one-third; we looked at the Crown doing only 20 percent and putting local authorities in the gun for 30 percent, which gave 50 percent, but in the end this was the best we could get to within the fiscal restraints that the Minister of Finance and the Government’s budget could withstand. I repeat two things: first, it is voluntary; and, second, the Government could have stood out and said that it was not taking part in this at all. We could have done that. I heard John Gray say last night: “I don’t think the Minister has looked in the eyes of people with a leaky home.” Boy is he wrong. What made me do this more than anything else in my life is that I have looked into so many faces of people with a leaky home. I have never been to so many meetings where everybody at the meeting was crying. My colleagues may suggest that I have that effect on a meeting when I go to it at any rate, but these people were crying because they had nowhere to go. They had no way out, they could not get loans, and they were sitting in rotten, damp, smelly, unhealthy homes. Stachybotrys can actually kill people.

I felt there was a moral obligation to come back and say that we have to do our bit. I have to say from the outset that if anyone thinks this is simplistic and we can blame the Crown for some of these things, or poor-quality builders, or untreated timber, or local councils, or poor inspection, it is not. It is a systemic failure of the whole lot across the board, from whoa to go. We could spend the rest of our lives going into the blame game. I really want to move on. I really want to get some houses fixed, and boy in my retirement will I feel good about it if I know that some people came out of this getting that result.

CHRIS AUCHINVOLE (National—West Coast - Tasman) Link to this

It is a pleasure to speak on the Weathertight Homes Resolution Services (Financial Assistance Package) Bill. I share the views that were expressed by my parliamentary colleague Darien Fenton, the last speaker from the other side. I think everyone would acknowledge that the Minister for Building and Construction has done a tremendous job on this bill. In fact, for those of us who came into Parliament in 2005, the issue has been an enduring concern. I am sure it has had consideration on both sides of the House as to how it should be resolved.

It is being resolved on a no-blame basis, and that is a significant part of its success. It is the same sort of success we have had with the accident compensation legislation. The solution otherwise was riven with legal difficulties as people sought to allocate responsibility, blame people, fold companies and start up other companies, and dodge the issue. The councils were left in the position of being the last person standing and felt aggrieved about that.

This solution, as well as being of the no-blame variety, is also a shared solution. The Government has stepped up with a financial assistance package to help people have their leaky homes not just fixed faster but fixed. I share the Minister’s concern at being told that he had not looked people in the eye. The members of the Local Government and Environment Committee had people come before us with heart-rending stories of feeling completely isolated in their position of not being able to do things. Many came to us to say they had engaged in litigation and had had what they thought was success. They had been awarded several millions of dollars, only to find that the actual cost would be several million dollars more, and that they were not covered. They were often elderly people who were in the position of not being able to borrow, because they had used up their assets in their initial borrowing. As I said, our hearts went out to them, and we would have loved to help them, but the opportunity is not always there.

The priority of this legislation is to get the homes fixed. It is really nice to be associated with a little piece—well, it is a large piece—of legislation that has a very clear purpose of getting the job done. That, I would suggest, is typical of this Minister, as those of us who have had the pleasure of knowing Minister Williamson for many, many years would know. I have known him for about 35 years, probably. I remember when he was the kid from the electorate where they did things by computer. Technology has always been a major feature of his role in Parliament, I am aware. But his capacity to get on with the job is another well-known feature of his profile, and this bill will do that. We are moving beyond the current state of endless disputes, litigation, and disappointment.

The financial assistance package is about spreading the cost as evenly and fairly as possible to get action. It ain’t a free ride for anybody. It has been really interesting to have the councils come to the select committee to express their views. They are not looking for a free ride, and they are not looking for a cheap deal, but they are interested in certainty of costs. This bill offers that. They are also aware, of course, of the contribution that is being made. The people making application are similarly interested in certainty and assurance.

Several key changes are being made. The bill caps the participating territorial authority’s liability in accordance with the contribution agreement, and any other contributing party’s liability—for instance, other solvent defendants—for claims being addressed through the financial assistance package. It draws a bit of a line across the page. It removes the Crown’s liability for the failure of repairs made under the financial assistance package, and any losses suffered as a result of actions of the Department of Building and Housing, Treasury, or the Crown under the financial assistance package processes. It provides a power for the appropriate Minister to prescribe a loan guarantee, or indemnity for repairs, made under the financial assistance package. It limits the time in which homeowners can apply to enter the financial assistance package to a period of 5 years from the time the package becomes operational. We asked the officials about that, and they said that with the improvement in building procedures, and with the improvement particularly in materials, they felt that 5 years would cover the risk time of the continuation.

The changes are necessary to facilitate the delivery of a financial assistance package to the owners of leaky homes.

Prasad Dr RAJEN PRASAD (Labour) Link to this

I am pleased to take a call on the Weathertight Homes Resolution Services (Financial Assistance Package) Amendment Bill, which has particular meaning for me and my family. In my maiden speech to this House I said one of the commitments I had given to my family was that if ever there was an opportunity to speak up about the leaky building issue, I would. I did that because when my son and my daughter-in-law came home after getting married, like a good—I would like to say Indian—family, the first thing we told our children to do was to buy a house. My son and my daughter-in-law did that. We took them to a house that was nice, and they selected it. They bought the house and set up their home there. But it was not long before it was declared to be a leaky building. I have never seen two young people, who were so much in love and so close to each other, love their home so much, and then get progressively so frustrated and eventually even depressed, in a colloquial sense, because there were no fixes. People were not interested; people were turning away.

I personally went to see those who had built the house. One builder whom I went to see was sitting there in his bula shirt from Fiji, having just come back from a holiday, but he said that it was nothing to do with him because the house had not been built by his company. I asked him the name of his company at the time. He said “Macrennie’s.” I asked him whether that was the name of his company currently. He said yes, so I asked him what the difference was. He said “Oh, it’s a different company.” I went to half a dozen companies that told me the same tale, so there was the private sector acting in its worst guise. It was using every facility this Parliament had provided in order to run businesses, yet I saw those crooks—because that is what they were—literally taking young people like my son and daughter-in-law to task.

We worked our way through that situation. I joined the body corporate and tried to find solutions. I will talk a little about those solutions, because they have some implications for some of the clauses in this bill. In the end, it became so frustrating for the couple that they told me to put a match to the house, and said they were going to leave the country. They wrote to every political party in this Parliament, and they asked them for their policies on this particular issue. They got no change from anywhere. They were frustrated. That was part of what it took for those two young people to apply to go and live in a different country—and they did leave. They are living quite successfully in Canada at the moment, but I hope they will return home before too long, and come back to live here. Thereupon, I said I would take care of the problem, and we then wrote the cheques that it took in order to fix the building and finally sell it, and send them whatever money was left.

When it comes to leaky buildings, I do not think we can take a great deal of credit for our lack of action over quite some time. I salute the Minister and this Government for saying they will do something, because it takes courage. It takes moral courage to say this is an issue, it is going nowhere, and we should try to find a solution. So I salute the Minister in the chair, the Minister for Building and Construction, for that, because we have spoken about this issue before, as well.

However, there are still some matters that bother me. I ask the Minister still to look at the provision he has already put aside. The amendment on Supplementary Order Paper—which one is it—

Twyford Phil Twyford Link to this

251.

Prasad Dr RAJEN PRASAD Link to this

Is it about speculators?

Twyford Phil Twyford Link to this

251—qualifying claimants.

Prasad Dr RAJEN PRASAD Link to this

The one about qualifying claimants. I know that people have been affected. I have talked about my son and daughter-in-law, but they were not the only ones. Some elderly people who live close by came to me as well, to ask what they should do. I know that people have bought leaky properties for a song. I even met some people 10 days ago who told me that they had bought these properties. They know that the properties were worth $500,000 or $600,000, and they purchased them for $200,000 in the full knowledge that they were leaky buildings, and in the full knowledge that there was a facility for 25 percent of the cost of repairs to come from the Government and 25 percent from the local authorities, which will now subsidise the fix. Assuming that it takes $100,000 for the purchasers to fix the property, the value of that property will increase substantially from the $200,000 that they paid for it to the $600,000 that it is actually worth. Here is the State, in the guise of the Government and local authorities, signing that off.

I wonder where the fairness is in that, when the people who bought the property earlier, who actually suffered, and who personally have left the property and sold it for a song, are not the ones who will get any benefit out of this package. It will be the new purchasers who take advantage of this. So there is a real moral aspect to this particular amendment, and I urge the Minister to look at it again. It addresses a serious issue, and there are cases like that around. We ought to know that we are helping those who cannot help themselves in this particular case, not those who have knowingly entered into a particular deal to buy a property or house at a substantially reduced cost. It is ridiculous what some of the properties have been sold for, and now we will subsidise the fix and there is no gain to us as a State. I think there is something wrong with that particular policy.

I move to a second part of this bill, about the assessor’s report. There is something I do not fully understand about the assessor’s report. I want to make two points. One is the reference to the assessor’s report. I get the impression it will be quite a—brief, although brief is not the word—concise report. From the reports that I have seen about leaky buildings, I think they need, of necessity, to be quite detailed. A quick look—or even a detailed look—without taking the cladding off does not give an idea of what the fix is about. What is to be the standing of the assessor’s report? Will the final amount settled for contributions be based solely on that?

And what happens—because I know this actually happens—when the cladding is taken off and people really see the damage that water has done? They cannot see it from the inside or by taking little sample cuts in a building, from either the inside or the outside. They actually have to take off the cladding and take the windows out before they can actually fix the problem. So what will happen if an arrangement has been made for a certain amount of money to be provided to fix the damage and then, when the cladding comes off, the problem is found to be actually bigger than that? Where is the space for the assessor’s report to be challenged? Where is the space, or is it anticipated, I ask the Minister in the chair, that provision for that will be built in? If the cladding comes off and the costs are much greater than had been anticipated, will there be a way in which the percentage increase that people are likely to fund is actually accounted for? That is a real problem; any builder will tell members that. Any person who has gone through this process will know that it was only when the cladding was taken off that they realised how much damage had been done.

Then it is not just a matter of simply putting the cladding back again, because there need to be some design changes. Inevitably there are design changes. There are the problems with cladding, and there are problems with flashing and what have you that have to be changed. Sometimes there are no eaves, for example. There is a cost to fix that, which is not the same as simply fixing the damage that has occurred, because the problem was in the whole design of the building. What will happen then? How is the assessor’s report to inform that fix, or does it set limits? If so, what kinds of limits does it actually set? There has been discussion, I understand, about some claims against that. The assessor’s report is pivotal, it plays a pivotal role, and where is the space for putting right the wrongs of the assessors, so to speak? Is there an appeal, is there some immunity, or is there some process by which an owner can say: “Here is a problem and this is how we will go about fixing it.”?

Those are two issues. I say to the Minister in the chair that I actually tried to get a report on my son’s property, a concise report, in order to get it fixed. We were almost on the verge of settling with those responsible, and I thank God that it did not happen, because we would have settled for about 25 percent of the actual cost of the fix.

Hon MAURICE WILLIAMSON (Minister for Building and Construction) Link to this

I will try to respond very quickly to two things.

I say to Dr Rajen Prasad, again, that we have a great difficulty in trying to exclude property speculators. There will be a number of people who choose to buy one of these homes, because the person who currently owns it says they cannot afford to service even the 50 percent loan and they would rather sell it. They would rather sell what they have and go. There are people doing that already. So, a young couple—it could be the member’s son and daughter-in-law—could say that they will buy one of those places. They can get it at a lower rate—there is still a lot of risk associated with it—they will spend money to do it up, they will have the Government and the local authority contribute, and then they will live in it. If we start to exclude people from doing that, we have a real definition problem on our hands about who is a speculator and who is a young couple deciding they will give it a go. It is very difficult. It is very difficult to do.

The other issue the member talked about is a real, serious concern, and we have a mechanism in the process to address it. When assessors look at a building and say they think there is $100,000 of damage—they do their probes, checks, and so on—and when the cladding comes off, they say: “Whoa. Sorry, old son. You were so wrong. This is much more.”, there is a process to go back and negotiate the higher level, an agreed position with all parties concerned. One could take that $100,000 settlement to, say, a $200,000 settlement. It is not saying: “This is what you signed up to and it is fixed.” There will be an iterative process. I have been on enough building sites now to have had enough of an education on this issue. There are many times when, until people have torn off the cladding, they cannot tell how endemic, how severe, and how far-reaching the damage is.

Wagner NICKY WAGNER (National) Link to this

The Weathertight Homes Resolution Services (Financial Assistance Package) Amendment Bill will be a relief to very many people who have leaky homes. It has been very interesting to listen to the previous member speaking, the Hon Maurice Williamson, who has sponsored this bill.

Leaky homes, as we all know, have been a longstanding problem. This problem arose probably between 1992 and 2005, and well over 40,000 houses across New Zealand have been affected. That number may still increase. Despite the anguish of numerous families coping with damaged, wet, and unhealthy homes, no effective action was taken by the Labour Government. It did introduce legislation to set up the Weathertight Homes Resolution Service, but that body ended up bogged down in expensive, lengthy disputes, and very few houses got through the process and were actually fixed. One of the first things that National did when it came into Government was to commission a report by PricewaterhouseCoopers, which identified and quantified the barriers to getting houses fixed. It was revealed that only about 3,000 homes had actually been repaired at that date. Labour’s system had been money hungry, excruciatingly slow, and uncertain, and it just added to the stress of homeowners.

National decided there had to be a better way. The Minister for Building and Construction, appalled by the waste of resources going into disputes, chose a collaborative model. Today we are able to offer a financial package that gets houses repaired and allows people to move on with their lives. Local government and central government will pay 25 percent each towards repairs, and the homeowner will be responsible for the other 50 percent. The Government will provide a loan guarantee underwritten by the Crown that will cover that 50 percent, as long as the owners meet the lending criteria.

Let me make it clear that no one will be compelled to take up this offer, but it is another option for people who have really suffered this uncertainty and who want to get some resolution in their lives. The package will be available for 5 years, and the Government expects to pay out about $1 billion to help families over that time. I believe that at long last we will be able to slam the door on leaky homes in New Zealand.

Twyford PHIL TWYFORD (Labour) Link to this

I will speak to Supplementary Order Paper 252 on the Weathertight Homes Resolution Services (Financial Assistance Package) Amendment Bill. The owners of dwellings in multi-unit complexes are one of the big groups of homeowners who will not benefit under this package. There are two main reasons. The first is that because of the Unit Titles Act requiring there be a 75 percent majority before a decision can be made by a body corporate—for instance, to enter into an agreement under the financial assistance package—it will be very difficult, practically speaking, for apartment dwellers to reach the 75 percent threshold. The other reason is that banks will not lend to bodies corporate, because bodies corporate under the Unit Titles Act cannot mortgage that collective property. About 24 percent, I think, according to PricewaterhouseCoopers, of the population of affected homeowners will not be able to benefit from this package. That is about 5,500 dwellings. So a really significant group of affected homeowners will not benefit.

Supplementary Order Paper 252 proposes to insert new section 125G(2) to allow the Crown to provide an indemnity or a Crown guarantee, which would open the door for banks to lend to bodies corporate. With respect to the Minister in the Chair, the Minister for Building and Construction, it is not enough to say: “Well, bodies corporate can do this anyway; apartment dwellers are covered by this.” The practical reality is that they are not, actually. Most apartment dwellers will not be able to benefit from this legislation, because the practical reality of getting the 75 percent majority of members in the body corporate to agree and to put up the money to do this will not happen. It will be almost impossible, as well, to get the banks to lend. This Supplementary Order Paper would extend the Government guarantee to allow banks to lend to bodies corporate. I do not know why I did not really hear a substantive explanation from the Minister about why he has chosen to reject this amendment. He says it is not necessary, and that the Government could provide what it proposes under the existing bill. I am not sure that that is the case. That certainly was not what we heard from officials at the Local Government and Environment Committee.

It is not enough to say that apartment dwellers will have access to the Weathertight Homes Resolution Service. If that was enough, why bring this bill to the House and launch a whole new initiative? I think the Government should think again and give thought to this amendment. Maybe the amendment has been rejected because the budget parameters of the initiative have already been set. Maybe it is because of the ginormous, eye-watering cost of the package that the Minister has been telling us about. But if that is the case, well, then tell the Committee. Otherwise, we are needlessly excluding about one-quarter of affected homeowners, and I think we deserve a better explanation.

I want to move on to my amendment to add to new section 125B. The Minister said he lauds the intent of it but does not agree with the substance. Well, one of the concerns we have had about the package is that it extends a 50 percent subsidy—25 percent from the Government and 25 percent from the local authority—to a speculator who may have picked up a leaky home at a knock-down price, gets the 50 percent subsidy from the ratepayer and the taxpayer, does a quick do-up job, then flicks it on and pockets a windfall profit, which is really courtesy of the ratepayer and the taxpayer. Given how great the unmet need is and how many homeowners who are grappling with this problem are excluded from this package, it makes no sense to us on this side of the Chamber that we are dishing out this generous subsidy to property speculators. The Minister said it was not practical to accept this amendment because it would be excluding people who had in good faith purchased a leaky home, in the knowledge that it was a leaky home. Well, the very point of that is if they bought the house knowing it was a leaky home, then presumably that price would have been heavily discounted so as to recognise the reduced value caused by the defect and the damage. I would have thought there was no need in that case for a 50 percent subsidy from the ratepayer and the taxpayer to go into the pockets of those people. The Minister has said in the past “Look, we’re just interested in getting these homes fixed. It does not matter who does them.” Well, there are so many people who are excluded from this package who will continue to suffer without the assistance this package offers that I would have thought it made a lot of sense to exclude property speculators from it.

The next issue I want to address, and I respond to the Minister’s earlier comments, is about Crown immunity. The whole purpose of this bill is to legislate for Crown immunity. If it was not for that, I do not think we would need the legislation at all; it could all be done by policy and regulation—

Hon Maurice Williamson Link to this

And local authorities.

Twyford PHIL TWYFORD Link to this

—OK, and through the role of local authorities. The Minister makes the point that the Crown does not have to come to the table. It does not have to put hundreds of millions of dollars on the table, because there is no established legal liability in this case. Well, that may be so, but the real point here is we are talking about the immunity that this bill gives to assessors from the Department of Building and Housing who, thanks to this bill, are relieved of their common law obligation to exercise a duty of care. If the homeowner finds that the quality of work of the Department of Building and Housing’s assessors is substandard—heaven forbid that that would be the case—or the assessment of agreed repairs was defective and because of that the homeowner cops a further liability, he or she will have no comeback. The Crown will not be held accountable for that. The Minister’s own officials in the Department of Building and Housing advised him against this provision giving immunity to the assessors, but he has made a political judgment. I see the Minister querying this, but it is in the regulatory impact statement. The advice in the regulatory impact statement in black and white is that giving immunity to the Department of Building and Housing assessors is not necessary and is not justifiable.

Furthermore, by giving those assessors immunity, it further exposes the builders, the architects, and the designers who will be required to do the remediation work. I think the Minister himself has alluded to the fact that there is some doubt, actually, that there will be many builders, particularly in light of the looming skills shortage, who will want to do this work at all, because the local authority will be indemnified, the Department of Building and Housing will be indemnified, and that leaves only the builders and architects to carry the can if something goes wrong in the remediation work. I am yet to hear from the Minister a convincing explanation for this immunity other than that the Government just does not want to do it. I invite the Minister to take a call in the remaining time and tell us whether there is a reason for Crown immunity. I will leave it there, and I will speak to my third Supplementary Order Paper later.

Hon MAURICE WILLIAMSON (Minister for Building and Construction) Link to this

I do not want to be a perpetual jack-in-the-box, but I will just respond to Phil Twyford’s comments about immunity. I think it is very important that members of this Committee understand that the Department of Building and Housing assessors have always been immune from proceedings relating to their functions under the Weathertight Homes Resolution Services Act 2006—the Act that the Labour Government passed. Assessors’ immunity is critical to the delivery of the financial assistance package under the Weathertight Homes Resolution Services Act. Assessors would not perform their role if they risked being joined in litigation about the leaky homes issue. Immunity also helps to ensure their independence and the objectivity of their assessment. All I can say is this bill is not affecting immunity. In fact, if we wanted to take away the immunity of those assessors who are going in—

Twyford Phil Twyford Link to this

So why should builders?

Hon MAURICE WILLIAMSON Link to this

The member asks about builders. Many of those have a vested interest in making money, and so on. The assessors from the Department of Building and Housing are not there to make money or whatever else; they are there to provide what I think is a public service role. If we wanted to do what the member wants, we would have to actually remove the immunity from the principal Act rather than from this bill, because this bill is not adding it. That means we would have to go back and say that Labour got it wrong in its 2006 Act. I do not think it did.

Kedgley SUE KEDGLEY (Green) Link to this

The Green Party believes in giving credit where it is due, so I think a lot of credit is due to the Minister in the chair, the Minister for Building and Construction, for attempting to solve a very intractable problem, and also for sitting in the chair, listening to the debate on the Weathertight Homes Resolution Services (Financial Assistance Package) Amendment Bill, and answering the questions that we are asking. It is quite a unique experience to be in this Chamber, have people raising questions, and have a Minister actually listen with courtesy, instead of ridiculing us, and answer our questions. I would like to give credit to the Minister for giving good, reasoned explanations for why he is or is not accepting various amendments. I also agree with the Minister that we should go beyond the blame game and look at solutions.

However, history will repeat itself unless we learn from it, and I want to take a moment to look at the history of this issue. It is not actually a blame game. It is not about attacking National or attacking Labour, because the 1991 Building Act was passed unanimously by both National and Labour. At that stage, sadly, there was no Green Party in Parliament. The point I want to make is that the lesson of history is the utter failure of deregulation. I think it is important that we accept that. We have a Government—not just this Government—and a whole lot of people who have the mantra of deregulation and self-regulation. We are being told, everywhere we turn, that self-regulation and deregulation will work, and we do not need all this onerous regulation. This leaky home disaster is an abject lesson in what happens with deregulation and in the huge cost of deregulation.

What did this 1991 Act do? The aim of it was to encourage competition in the market, boost the building industry, reduce building costs, and save money. Everyone whipped themselves into a fervour about the wonderful things that would happen with the passage of the Building Act and with deregulation. The Act wiped out all the previous regulations and controls, loosened councils’ inspection procedures, and allowed the introduction of private house-inspectors, so that there would be competition with council inspectors. Oh, there was no need to bother about skills! We did not need to have skills any more. Training was removed. Everyone was so enthusiastic; this was going to encourage competition, boost the building industry, reduce building costs, and save money. I want to repeat this, because this is what we are hearing as a mantra on just about every other bill that comes to the House: “We are going to encourage competition. We are going to reduce costs by removing competition.”

We cannot emphasise sufficiently that this leaky building crisis is an unmitigated fiasco. It is the largest man-made fiasco in our history, with costs likely to be $22 billion. One of the National members talked about 40,000 people being affected by leaky homes, but the expectation is that the number could be somewhere around 89,000 people. This is all happening because of deregulation. We left it to the invisible hand of the market. We allowed builders to enter and exit the industry, with no liability and no costs. They could whack something up, then disappear and go to Australia—deregulation. Please, nobody ever tell me that deregulation and self-regulation are the solutions to save money and reduce costs. This is like a case study of the abject failure of deregulation.

Having got that off my chest, I will mention that we all know people who have been caught up in this fiasco. The most recent was a friend of mine from the United Nations. She thought she would like to return to New Zealand on her retirement and buy a building. She showed me this apartment she was going to buy on the Kapiti coast. I took one look at it—it was a mono-clad building—and said “Sue, are you absolutely sure that isn’t a leaky home?”. She said “Oh no, no.” Her brother-in-law was a real estate agent and he checked it all out. I said: “Please get it checked out. This could be a leaky home.” So she arranged for somebody to come and have a look at it. This person, an independent consultant, absolutely assured her that this was not a leaky home. She had owned that apartment for less than 6 months before the grim news came in that it was leaking like a sieve. This was only a few years ago. This independent contractor had absolutely assured her that her apartment was not a leaky home, but, of course, it was leaking like a sieve.

As the Minister in the chair is answering people’s questions, to my great admiration, I have a question for him. Yes, I understand what he is saying about a time frame for financial assistance, and that we cannot have an indefinite time frame. But we heard a lot about people who had houses built in the 1990s—some estimating the number could be 15,000 to 20,000—that will fall outside the time limit. I can understand that the Minister has set a limit of whatever it is—that financial assistance cannot be given after this particular time—but why are we excluding people who had houses built in the 1990s? They will miss out. That is one of those things that seems incredibly arbitrary. I understand that the Minister is saying there needs to be a time limit, but why not at least include, not exclude, in the package those who built homes in the 1990s?

I strongly agree with Phil Twyford about multi-dwelling homes. The Minister was not at the Local Government and Environment Committee to hear the submissions, but we were told that about 5,500 people in multi-dwellings will not be eligible. It will be very difficult for bodies corporate to be eligible. I think that the proposal that Phil Twyford has come up with for multi-dwellings is a very positive initiative. Again, I would appreciate it if the Minister could answer why that one does not seem to make sense. I say to the Minister that that was one of the big issues that submitters raised with us.

I was very pleased to hear the Minister acknowledge that Stachybotrys can kill people. That also worries me. We had so many people say to us that they could not afford to pick up 50 percent of the cost, so they were wondering what would happen to them. Some of those people said they were living in homes that were unsafe, they were a health hazard, and they have Stachybotrys mould. So what are we going to do? It is fantastic that we are providing some sort of solution, but what will we do for those poor people who simply cannot raise a mortgage, get a bank guarantee, or whatever, for that 50 percent? What will we do about those people? We cannot just ignore them, because we have people who are living in insanitary, unsafe homes that are a health hazard.

So, yes, congratulations to the Minister and to the Government for coming up with a package. I understand that it is extraordinarily complex and difficult. I am glad I did not have to go, as the Minister did, to numerous meetings with people sobbing—I can believe that. But we heard the submissions, we all have our friends, and we know the utter, total tragedy this has caused for so many lives. We need to remember that it was deregulation—deregulation; nothing else—that created this problem. Deregulation is what caused this $22 billion problem, which is estimated to affect 80,000 New Zealanders and causes abject misery to so many people. It is deregulation that has done this, so let us not hear that endless mantra from Rodney Hide, the ACT Party, and National that deregulation will solve our problems. Actually, what it has done is create the biggest man-made disaster in New Zealand’s history.

Hon MAURICE WILLIAMSON (Minister for Building and Construction) Link to this

I will take a very quick call on Part 1 of the Weathertight Homes Resolution Services (Financial Assistance Package) Amendment Bill to respond to Sue Kedgley’s question about the 10-year limitation period, because it is a very important point. The 10-year limitation period has been reviewed several times in things like the Building Act, the Weathertight Homes Resolution Services Act, and so on in the past few years, and it has been found to be a sound and appropriate level. One cannot sue a local authority over a building that is more than 10 years old. The most recent review was the Limitation Act 2010, which was passed by Parliament last year. It left the 10-year longstop in the Weathertight Homes Resolution Services Act 2006. So the 10-year limitation period is a well-established level. We would be changing a whole lot of the ground rules—we would have to go back and change the Weathertight Homes Resolution Services Act and everything it is founded on as well—if we were to now take out the 10-year limitation period. It is clear that most of the damage appears in a building long before it is 10 years old.

Councils would not be liable, so they could not be brought into this legislation. I am also told by a number of the assessors that it is really difficult to determine the extent of damage that has been caused by weathertight issues versus other possible causes like a lack of maintenance and so on if the limitation period goes for too long. Houses need to be maintained. We found a house that had a serious problem because the homeowner had never cleaned the spouting. The spouting was jammed with leaves. It was blocked rock solid. Any water that came off the roof went straight through the eaves and into the back of the house. If the homeowner had done some reasonable maintenance, there would not have been a problem.

We have a period of time. We have to get to a limit and say that that is it. The 10-year limit is well tried and well tested. I would not want to be a Minister who tinkered about with it, given that it has been looked at so many times. We are maintaining that 10-year limit. The good news for anybody who is worried about getting to the 10-year point or thinking that they are close to it—even as of last May when we made the announcement in all of our material—or if people are worried they will hit the deadline, they should register with the Weathertight Homes Tribunal and we will stop the clock on the day they register.

Twyford PHIL TWYFORD (Labour) Link to this

I refer briefly back to the issue about Crown immunity, or immunity for the Department of Building and Housing assessors. I saw the look on the face of the Minister in the Chair, the Minister of Building and Construction querying my suggestion that his Department of Building and Housing officials had advised that there was no need for Department of Building and Housing assessors to have this immunity. I refer him to page 7 of the regulatory impact statement. It states: “The Department of Building and Housing considers that it is appropriate for the Department/Crown to be held accountable for the work that it is responsible for.” That is after a lengthy passage that states that it is perfectly manageable for the assessors to be accountable in the normal way under the law.

I will talk about my amendment to section 125F, which is on Supplementary Order Paper 250. I am disappointed by the response we have had from the Minister about this amendment. This amendment deals with the bar on third-party claims over houses that are subject to the repair agreement under this package. The bill states that if a builder or a designer is sued by a homeowner, they cannot enjoin a council that is already party to the agreement. We heard from submitters—and it is spelt out in the regulatory impact statement—that that takes away a property right. I expect the member for ACT to prick up her ears at that suggestion. This takes away a property right. It takes away a right under the common law for a third party, a builder or a designer, to enjoin a council to legal action. Imagine this as the situation: a builder is sued by a homeowner. They say: “Crikey, we are not the ones who are fully responsible; the council was even more to blame than we were for this leaky home. Why should we be the last man standing? The council should be part of this conversation and should share some of the liability.” Under this bill that legal right is taken away from those third parties. That seems unfair to me. I know that there is a political justification. The Minister has said councils made it very clear that they would not pony up and be part of this package unless they were fully protected.

Supplementary Order Paper 250 offers a balanced and reasonable compromise. It still limits the liability of the councils. It says that if a third party—like a builder or an architect—finds themselves being sued by the homeowner and wants to enjoin the council, then they have to prove to the tribunal or the court that they have a good case that stands a reasonable chance of being successful, and that the liability of the council in question is likely to be significantly more than the amount that they are already committed to under the 25 percent in the repair agreement. There is a significant threshold that the third party would have to reach if they were going to then enjoin a council in this legal action.

When the Minister took a call on this earlier, I did not hear a substantive response to this Supplementary Order Paper. When we are taking away the legal rights of people like builders and architects in this situation, we do at our peril. So it is only fair that we think very, very carefully about it. We offered in this Supplementary Order Paper a balanced approach that does not expose councils to unrestricted liability. It would require that a third party front up to the tribunal or a court of law and make the case that the third party would stand a good probability of winning.

Calder Dr CAM CALDER (National) Link to this

It is gratifying to hear the accolades from members all around the Chamber for the Minister for Building and Construction, who has been working on the Weathertight Homes Resolution Services (Financial Assistance Package) Amendment Bill. They have commended the Hon Maurice Williamson for his work on this longstanding problem.

An Englishman’s home is said to be his castle; a New Zealander’s home may be a whare, a fale, a crib, a bach, a villa, a bungalow, an apartment, a town house, or a stand-alone modern home. The last three—the apartment, the town house, and the stand-alone modern home—were built from the early 1990s through to about 2005 out of the monolithic cladding that allowed remarkable shapes to be created and built relatively cheaply. For a while it seemed to be an interesting addition to the materials available to the home builder and home buyer, and the designer, architect, and the like in the profession, but towards the end of the 1990s it became increasingly evident that there were significant problems with this building material.

The situation went on for a number of years, and was largely ignored by the previous Government. In 2002, as late as 25 November, Helen Clark famously told NewstalkZBhost Paul Holmes that she had not taken much notice of the New Zealand Herald’s numerous stories about leaky homes, because the New Zealand Herald was well known for banging on about issues of no substance. Her comments surprised Prendos director Phil O’Sullivan at the time, who commented that he had been campaigning for 4 years to stop the problem. He said he was very surprised that the then Prime Minister was so badly informed.

The problem was evident, but no solution to the problem was found. There were some attempts under the previous Government, but when we came into power one of the fundamental decisions we made was to fix a problem that had tens of thousands of New Zealanders living in cold, damp homes harbouring mould and fungi—Stachybotrys was mentioned by the Minister and the honourable member Sue Kedgley earlier—which can have appalling effects on a family’s health. Safety and security of body and soul and of family and property are the fundamental underpinnings of Maslow’s hierarchy of human needs. A safe and secure weathertight shelter is fundamental to the physical, emotional, and economic well-being of all New Zealanders.

Along with other members of the Local Government and Environment Committee, I have met a number of owners of leaky homes and have looked into their faces. I am reminded of the line from an old song: “The lines on my face reflect the wrinkles I’ve ironed out in my life.” I have looked into the face and the eyes of those people whom we have seen in the select committee and others I have seen out in the community, and I have heard their stories. They were heartbreaking—they were heartbreaking. I have looked into their faces. I have seen pain, I have seen rage, I have seen deep sadness, I have seen frustration, and I have seen despair. The estimated number of leaky homes—some say 30,000, some say 50,000, and others say 80,000—are not mere wrinkles in the lives of owners so affected. They represent deep, fundamental, savage, wounding assaults on their very quality of life. As I said, the stories we heard—and I think all members of the select committee would agree—were heartbreaking.

This financial assistance package outlined in this bill is designed to bring tens of thousands of New Zealanders hope—hope and a way forward from an appalling and untenable blight that is damaging thousands and thousands of lives. As the Minister mentioned earlier, the causes of this problem are many and varied. This is not a time to apportion blame; this is about a way forward. The solution is made on a collaborative and no-blame basis. We believe that it is a fair and effective package, and we aim to spread the costs as evenly as possible.

The question was put that the following amendment in the name of Phil Twyford to clause 6 be agreed to:

to add the following paragraph to the definition of “qualifying claimant” in section 125B:

“(c)but does not include a person who has purchased a dwellinghouse with knowledge that it is a leaky building.”