Hon Dr NICK SMITH (National—Nelson) : I move, That the Building (Late Consent is a Free Consent) Amendment Bill be now read a first time. The building and construction industry is one of New Zealand’s largest, involving $13 billion a year of work. It is a sector that employs over 100,000 people. This industry stops and starts on the issuing of 81,000 building consents each year. The problem this bill addresses is the delays in getting these consents. The law is quite clear. Councils have 20 working days to say aye or nay to a building consent. The problem is that the law is being blatantly ignored. There is no penalty, nor any incentive to comply. The Department of Building and Housing does not even require councils to report on the number of consents for which they break those time limits.

The anecdotal stories of delays come from the far north to the deep south—families living in tents for months, builders being laid off, and land sitting vacant. Time is money. The cost to New Zealand of delays in getting building consents amounts to tens, if not hundreds, of millions of dollars per year. The part that makes me angry is that this Government does not seem to give a toss about all of this. We get all this bumf from the spin doctors in this Government about economic transformation, improving productivity, and reducing compliance costs, yet we live in a nation in which it takes months to get a building consent for something as simple as a garage.

Although the Government cannot be bothered collecting any statistics on this problem, we can get some idea of the scale of the problem. The Tasman District Council admitted earlier this year that 61 percent of its consents went over time. Nelson City admitted to a figure of 37 percent. A survey last month by the New Zealand Business Council for Sustainable Development found that 49 percent of consents, or roughly half nationwide, went over time. There are over 80,000 consents each year under the Building Act, so this amounts to about 40,000 late consents each year.

Let me give members a flavour of the frustration for each of those 40,000 people. Dean and Rebecca Olney, in my area of Nelson, applied for a building consent for their standard five-bedroom home in Mahana on 19 June. It took 60 days for them to finally get assent. Their poor builder sat around doing absolutely nothing for 3 weeks while they waited for their consent. How can members opposite talk about improving productivity with that sort of waste going on? Colin Hill, the immediate past-president of Architectural Designers New Zealand, said that the huge backlog of consents is causing an industry slow-down. He says that one can speak to any architectural designer, builder, or housing company and they will tell of numerous cases of building projects that have been postponed or put off indefinitely because of delays in getting consents. In fact, frustrations have become so high that a Christchurch company earlier this year took the amazing step of having a judicial review in the High Court against Selwyn District Council. That company, Williams and Co. Trustees Ltd, applied for a building consent for a home in Terrace Downs on 7 December last year. By 21 March this year, the consent had not been processed. The court gave the council 3 days to comply, which it did, but this is an extreme situation.

Citizens should not have to go to the High Court to get a council to issue a building consent in a timely way. Well, tonight it is time to change that. This bill is about people’s rights. It is about saying that public bodies should obey the law, just as citizens have to obey the law. I know this concept of public officials having to obey the law is pretty alien to this Government. We see the Government’s attitude towards the Prime Minister forging paintings, the 180 kilometre an hour motorcades, the corrupt work for immigration favours, and, most recently, towards stealing public money for electioneering. This Government thinks it is OK for public officials and the Government, but lo and behold if anybody else should not comply with it.

Hon David Benson-Pope: I raise a point of order, Madam Speaker. That language was completely unparliamentary. The member must withdraw and apologise.

Hon Dr NICK SMITH: Can the member explain what word was unparliamentary?

The ASSISTANT SPEAKER (Ann Hartley): The member will be seated. The member does not call across the House like that. I will rule on the point of order. It is not in order to accuse a member of the Government of what the member accused it, and the member will withdraw and apologise.

Hon Dr NICK SMITH: Can the Assistant Speaker in the chair be very explicit about which words I used that were inappropriate?

The ASSISTANT SPEAKER (Ann Hartley): I think the member is very clear about what words he used, and he will withdraw and apologise.

Hon Dr NICK SMITH: I simply ask, Madam Assistant Speaker—

The ASSISTANT SPEAKER (Ann Hartley): The member will withdraw and apologise.

Hon Dr NICK SMITH: I do not know what I am withdrawing or apologising for.

Hon Clayton Cosgrove: I raise a point of order, Madam Speaker. There is a longstanding convention in this House that you make the rules, not that member. You have ruled. He cannot contest your ruling. If he contests your ruling, he should go out, have a lie-down, and put a wet towel over his head. He should adhere to your ruling and not contest it. He is in breach of the Standing Orders, and he knows it.

Hon Dr NICK SMITH: I withdraw and apologise. This bill is about changing a sick culture, whereby this Government and its officials believe it is OK to break the law. It is based on a very simple notion: if the consent is not processed by the due date, the council loses the legal right to charge for it.

Hon David Benson-Pope: What did the judge say about that member? He can’t be trusted.

Hon Dr NICK SMITH: “Shock! Horror!”, some like David Benson-Pope would say. “Fancy the poor council losing its fee for not complying with the law!”. But I put it to members that if a citizen does not pay his or her rates on time, the council, under the law, is able to charge a penalty; if a citizen fails to lodge his or her objection against a resource consent within 20 working days, it simply does not count; if a citizen fails to pay his or her tax on time, he or she pays a penalty; if a citizen fails to pay his or her car registration on time, he or she pays a penalty. So I put it to this House that if it is good enough for the goose, it is good enough for the gander.

I must put on the record that I do have some sympathy for the position of councils’ building officials. This Government has made a complete hash of the building regulations, and the Department of Building and Housing is making the job for councils a nightmare. The extra regulatory burdens placed on councils by the Department of Building and Housing are over-the-top. We have building officials who should be clearing the backlog of consents filling out all number of forms and meeting the compliance demands of the department. We also have the bizarre situation rightly exposed by the Certified Builders Association, which is infuriated by the fact that the Department of Building and Housing and Standards New Zealand—two different Government bodies—tell it different things about what complies with regard to a building.

So one might ask how this bill penalises the Government, as well as the council, for its role in adding to the delays faced by builders and homeowners. Well, the department is funded by the building levy, and this bill exempts the homeowner or builder from paying fees to both the council and the Government if the 20-day time frame is not met. This puts the incentive both on the council and on the Government to ensure consents are processed within the 20 working days.

Let me respond to some of the criticisms of the bill. Sceptics might ask what will happen if the consent application is incomplete. The law already clearly covers this. Section 48(2) of the Building Act states that the council may require further reasonable information, and the time period is suspended until it receives that information. A further criticism is that it is just not possible to do so in a timely way. I draw this House’s attention to the example in Hamilton, where the council has adopted exactly this policy, and has done so such that it has 100 percent compliance. In fact, in Hamilton the average time for processing a building consent is just 6 days.

I suggest that this bill be referred to the Local Government and Environment Committee. It is a small, pragmatic bill that deals with a real problem for real people. It is about fairness. It is about saying that building officials and public bodies should face penalties just as citizens do when they break the law. It is about reducing compliance costs and reducing the red tape that kills off enterprise, kills off innovation, and kills off people’s get-up-and-go. And it is about improving productivity. If this bill improves the efficiency of our building industry by just 1 percent, that amounts to $100 million a year. The challenge we face as a nation is about making the boat go faster, so we might catch up with faster growing economies. There is no magic bullet to this problem; it will require a whole lot of small efficiency gains for an economy—of which this bill is one.

Tonight we should give the people a win. It is time Parliament told the bureaucrats we mean what we say and we say what we mean. Parliament says a building consent must be processed within 20 working days, and we mean just that. I make no bones about the fact that there are other Acts to which this principle should apply—like the Resource Management Act. But, for now, I urge Parliament to make this change in respect of the Building Act. It is time that Parliament recognised a problem faced by citizens—that time matters, and time costs.

Hon CLAYTON COSGROVE (Minister for Building Issues) : Let me say from the outset that the Labour Party will oppose this Building (Late Consent is a Free Consent) Amendment Bill for a series of logical reasons. The first thing I would point out about this mammoth, weighty tome, of about one A4 page, is that this is the typical Nick Smith bill—it is light. It is very, very interesting that Nick Smith finished his speech by talking about giving the people a win and reducing compliance costs. Well, here is a really interesting point: the National Party joined the call to reduce compliance costs and reduce general rates increases. National says, of course, that those are an impost on the general ratepayer. Let me point out to Mr Smith that, thanks to his light research, this bill would do exactly the opposite of what National’s policy is.

At the moment, if I apply for a building consent—myself, the user—I pay. Nobody else pays, and the general rates do not go up. I pay, because I am the person who wants to construct the house or the building. Under Mr Smith’s bill, if the council misses the 20-day mark, that person—that is, myself, the user who wants the consent—will get it for free. Well, that is a nonsense for a start. There is no such thing as a free consent. So, of course, the council, which still has overhead costs to meet but which cannot charge the user, will impose that charge generally on every other ratepayer in the local authority. So I say to all ratepayers sitting at home listening to this who are not in the position of wanting to construct a building that if this bill goes through, their rates will go up. I also say to Dr Smith that the primary objective for the local authority, under this bill—as Dr Smith himself admits—would be to get the consent through in 20 days, whatever the cost.

Hon Dr Nick Smith: That’s right. Good job!

Hon CLAYTON COSGROVE: He says: ‘That’s right. Good job!”. Well, I say to him that quality inspection would be sacrificed. That is what would be sacrificed, because what would the objective of the local authority be? It would be to meet the 20-day rule or get pinged. What the local authority would then do—even those small local authorities like the three in the far north that are very smart and clustering their services in attempting to get their act together—is to throw quality out the window. Councils would also make damn sure that they meet the big commercial consents, because that is where the big dollars and the big penalties would be.

So what does the bill do for mum and dad Kiwis whom Dr Smith purports to say he supports? Well, mum and dad Kiwis would go to the bottom of the queue, because if a 20-day consent on an average home is missed, it is a heck of a lot smaller penalty than if one of the big ones is missed. This is a pathetic bill—an absolutely pathetic bill.

Dr Smith talked about history. He talked about what had occurred in the construction sector. Well, let me say, and remind him—and he purports to be an engineer of some note in his own mind; I just wish I was as good as he thinks he is—

Hon Dr Nick Smith: I have a PhD.

Hon CLAYTON COSGROVE: Let me say this to Dr Smith—oh, he has a PhD. Well, blow me down, I do not. If he has a PhD, God help the person who marked his paper—if he were to read this flimsy piece of legislation that shows Dr Smith obviously did not learn much.

I say to Dr Smith that the history of the mire the building and construction industry is pulling itself out of now rests squarely with the legacy of that member when he was in Government in the 1990s. The legacy was—and this is the member of Parliament who promoted it, along with his colleagues—the total deregulation of the building industry. What does that mean? That means that he got rid of any minimum standard, any rules, and any minimum framework. Any cowboy, even Dr Smith, could pick up a tool belt, call himself a builder, and go to work. He did that, the National Government was in power, and he passed that.

The second thing he did was to abolish the Apprenticeship Act in the 1990s. He abolished it.

Hon Dr Nick Smith: Rubbish.

Hon CLAYTON COSGROVE: He says “rubbish”. He abolished the Apprenticeship Act, he drummed it out of Parliament, and what did that do to the industry? Well, if there are no minimum standards because there are no minimum rules and regulations, and if people are not being trained to be the tradespeople and the master craftspeople of the future, then there is a debacle. Firstly, there is a billion-dollar problem of leaky buildings that rests with his legacy. Secondly, there is a sacrifice of quality.

I say to Dr Smith that the Department of Building and Housing is going around auditing and accrediting territorial local authorities to get them up to speed, because the truth is that many territorial local authorities were good but some were appalling. I will come to an example in a moment. We are telling territorial local authorities that they have to get their inspection quality up, they have to get their processes up, and they have to get their resourcing up, because many of them did not resource their inspectors, their officials, or their processes.

The one thing Dr Smith did say that was on cue was that there has been a building boom. That, for Dr Smith’s small mind, indicates there is some pressure on local authorities. This is not the 1990s, when the construction industry languished and fluctuated regionally. No, there is a building boom because people have money in their pockets for construction.

I ask whether Dr Smith is on the side of the ordinary man. I point to a guy called the Rev. David Moore in Christchurch. This is a public case, so it is on the record. What happened to that bloke? He thought he had a leaky building problem, and he did. What happened? Well, he got stuck in and had a look and, yes, it was a leaky building. He peeled off the Gib and the cladding, and noticed that not one nail had hit the beam—the problem was nothing to do with leaky buildings. His door frames were sinking, the place was an absolute mess, and it almost destroyed his family’s life. I visited him. I do not posture like that member over there; I visited that home. That bloke has pulled himself out. Do members know what happened? The building inspector came around. There was a problem. The Gib was up; the cladding was up. No one could see the beams, the dwangs, or the braces, but the plans were OK. I was told that the building inspector said: “Well, mate, if she’s on the plans it’s OK.” It got a big tick, just to get it through in under 20 days.

That is the sacrifice we will have, a sacrifice of quality, and Dr Smith will perpetuate what he started: the degradation of the building and construction industry. So every person who is sitting out there tonight who wants a building consent should not rely on his or her territorial local authority to give a quality job if this legislation gets passed. The authorities cannot be blamed if this bill gets passed, because the pressure will be on them to hit the 20-day mark—to hell with quality, to hell with safety, and to hell with anything else, but just to hit the 20-day mark.

This is a silly bill from a silly member, a light bill from a light member, and a troppo bill from a troppo member. I say to him—

The ASSISTANT SPEAKER (Ann Hartley): No, the member cannot say that. Please withdraw and apologise.

Hon CLAYTON COSGROVE: I withdraw and apologise. I say to him that we are embarking on the biggest transformation and reconstruction of the building and construction industry in its history, supported with the licensing of building practitioners by builders, and with absolute protection for DIYers, despite the mistruth he printed in the New Zealand Herald that said I had passed a piece of legislation outlawing DIYers. Well, I have to tell that twit over there that to date I have not passed a piece of legislation. That is a lie from him.

The ASSISTANT SPEAKER (Ann Hartley): No, no. The member needs to apologise.

Hon CLAYTON COSGROVE: I withdraw and apologise. That is a mistruth, because I as a new Minister have the bill before Parliament and I have not passed any legislation yet. So the member should work that one out. I say that his credibility is in the outhouse.

This is a light piece of legislation. It does exactly the opposite of what the party Dr Smith belongs to wants to do. National is saying: “Lay off the ratepayer.”, but he has produced a stupid piece of paper that says the user will not pay. If someone does not hit the 20-day mark, everybody else will pay—to hell with quality, to hell with safety—and the pressure will go on.

Not only has Dr Smith come here with a plan but he has come here with a plan to exacerbate the pressure on already stretched local authorities. Under our legislation those authorities in the far north that are smart, clustering their services, reforming their processes, wanting to get up to speed, and wanting to be building consent authorities once they are audited and accredited, will be able to go out to consumers and say: “If you get a building inspection, it’s going to be a proper inspection and it is going to give you confidence that your builder will be licensed”—not like Dr Smith’s—“and will be a dinkum builder on a register, on the Internet, and able to be checked up on”. There is no policy from Dr Smith. Under our bill the inspection will be a decent building inspection. It will have to be A1, because people will be paying an A1 price.

What will Dr Smith’s bill do? It is light, it is stupid, and it demeans him as a front-bench member of the National Party. There is no thought in this political pamphlet—none; zip. It is a typical Nick Smith special: “Let’s throw a slogan in, let’s jump on the bandwagon of something, and let’s have a go.” I have to say that any ratepayer listening to his speech who is not building a house will think: “Hey, this is not a bad idea.” But until we drill into the bill, and until we look at it carefully, until that point we do not realise how light and how troppo it is, from a troppo member.

Hon Dr Nick Smith: I raise a point of order, Madam Speaker. I assume you are going to ask him to withdraw and apologise for the last derogatory statement he made. I know that he does not have substance. He always resorts to personal abuse, but I think it is proper for the House to require him to withdraw and apologise.

The ASSISTANT SPEAKER (Ann Hartley): I ask the member to withdraw and apologise for the last remark.

Hon CLAYTON COSGROVE: I withdraw and apologise

Hon Dr NICK SMITH (National—Nelson) : I wish to seek leave to table a document. The member claimed, and I know that he is a junior Minister—

The ASSISTANT SPEAKER (Ann Hartley): Well, the member needs to name the document.

Hon Dr NICK SMITH: I wish to table the speech of Mr George Hawkins, who claimed that the building reforms of 1991 were all from Labour’s good work from the late 1980s and that National could claim no credit for them. I think it is important.

The ASSISTANT SPEAKER (Ann Hartley): Leave is sought to table that document. Is there any objection? There is.

Hon Dr NICK SMITH: I seek leave to table the report from the Hamilton City Council, which has adopted this very policy, has been able to provide for all its building consents within the statutory time frame without any cost to the ratepayer, and is providing a very high quality of building consent services.

The ASSISTANT SPEAKER (Ann Hartley): Leave is sought to table that document. Is there any objection? There is.

Hon CLAYTON COSGROVE (Minister for Building Issues) : I seek leave to table the associated historic reports that will be on archive—and the Hansard, of course—which will prove that the National Party abolished the Apprenticeship Act, which Mr Smith is in historical denial over.

The ASSISTANT SPEAKER (Ann Hartley): Leave is sought to table that document. Is there any objection? There is objection.

JACQUI DEAN (National—Otago) : I intend, in speaking to this Building (Late Consent is a Free Consent) Amendment Bill to stick to the bill. But before I do that, I note how deeply disgusting I found the contribution by the previous speaker, Clayton Cosgrove, in which he was compelled to withdraw and apologise three times. This surely must be a record even in my short time in Parliament. I think the previous contribution did the member no credit at all, but it is probably of the quality we are getting used to.

Let us turn to the bill and wonder why it is such a threat to Mr Cosgrove. I think I can tell members why; it is because this bill calls for accountability in the local authority. It is as simple as that. The purpose of this bill is to provide for a late consent to be a free consent. If members cannot tell me that 20 working days—with a provision called section 42A set within the Building Act whereby if further information is required that clock can be stopped—is not enough for the bureaucrats within the building departments of local authorities to process a consent for a garage, then we are living in a very strange and inefficient local government sector.

I want to address the rather—shall we say—excitable contribution of the previous member, who said there was no free consent. I believe that, of course, there is no free consent. What this bill does is put accountability where it belongs. It puts accountability back on to the bureaucrats.

Now, I will not get excitable about this bill, even though I have to say that it is quite an exciting bill. When it is passed, this bill will provide some kind of certainty for the building industry. When builders who have one or two people working for them are planning their work programme, they will be able to have some kind of certainty that the work they are applying to do and the consents they are applying for will be actually granted in a timely manner. Let us not make this an issue about rocket science. This is an issue about granting consents under the Building Act for constructing garages and houses and other buildings; it is not very difficult. The 20 days provided for under section 42A of the Building Act—in my experience as a local authority member—is quite enough.

Hon Dr Nick Smith: I raise a point of order, Madam Speaker. I apologise to my colleague. The Minister has been constantly interjecting all the way through this member’s very considered speech. In the last interjection he said the word “you” three times, which is, of course, a breach of the Standing Orders. Are you going to require—[Interruption] I understood that points of order are heard in silence. My simple point is to ask whether you require some standard of conduct from Ministers in the Government in respect of the conduct of this debate.

Darren Hughes: We contest Dr Smith’s assertion that Minister Cosgrove was barracking the entire way through that speech. He interjected a few times, but to be lectured by Nick Smith, of all members of Parliament, about interjecting on other people’s speeches and making inane comments is just too much. It is a robust debate, and I thought the member on her feet was handling it reasonably well. To have her speech broken up by her own colleague—one of the worst offenders—seems to me to be a bit strange. I think the point of order that he makes, therefore, is out of order.

Eric Roy: The premise that someone has some historical attitude, in the mind of the member who was speaking to the point of order, is irrelevant. Past issues are not dealt with again, as Madam Speaker knows. The issue is about the conduct of the House at the time this member is speaking.

The ASSISTANT SPEAKER (Ann Hartley): The member is quite right, but certainly I did not see anything for me to rule on. I think the interjections were quite within the Standing Orders.

JACQUI DEAN: It is interesting that the Government is so passionate about economic transformation. I am not even sure what it means by that, and I would be very interested to hear from somebody who would take a call and explain exactly what “economic transformation” means in the context of an argument that the Building Act does not need to be efficient, which is what the previous member who spoke, Mr Cosgrove, was asserting. His assertion was that it does not matter; the Building Act and the building industry do not need certainty. Well, in my view, that is absolutely rubbish. I would love the member to take a call, rise to his feet, actually address the bill, and tell us how that assertion fits in with the Government’s noble notion of economic transformation, because I am blowed if I know. It is interesting that there is $13 billion a year of work in the building industry, and there are over 100,000 people employed in the building industry who all rely on efficient local government processes.

BARBARA STEWART (NZ First) : On behalf of New Zealand First, I rise to speak to the Building (Late Consent is a Free Consent) Amendment Bill. New Zealand First will support the referral of this bill to the Local Government and Environment Committee, with no guarantee that we will support it any further than that. We are very aware that very few things in life are free, and building consents certainly are not amongst them. [Interruption]

The ASSISTANT SPEAKER (Ann Hartley): I am sorry. When there are interjections across the House and the speaker is standing down there, it is impossible to hear. I ask members to be quiet.

BARBARA STEWART: If the user does not pay for a building consent, then we can be absolutely certain that other ratepayers will. Once again, we have a bill before us in this House that promises far more than it can actually deliver. We have a bill that again deals with subjects about which there is considerable public feeling. Once again, we are faced with the dilemma of sending a flawed bill to a select committee, finding a better alternative for dealing with the issues, or not accepting that there are any public concerns.

New Zealand First acknowledges that there is public and industry discontent, and that there are perceptions that there are unnecessary delays in processing building consents. We note Hamilton City Council has a scheme similar to that proposed here, with—as the Hon Dr Nick Smith said—a 6-day turn-around process. However, there are very serious problems with the envisaged regime. We have a concern that some authorities may be encouraged to find innovative ways to restart the consents process clock, or that the quality of the decision making may suffer—and I know the Minister has alluded to that. We do not want there to be another round of leaky buildings. The bill overlooks some of the fundamental reasons for the current delays, one of which appears to be a serious shortage of trained staff. That problem is not easily rectified. We are very aware, too, that recent legislation such as the Building Act of 2004 may have exacerbated the problem, by adding to the confusion around that particular issue.

New Zealand First sees some very serious shortcomings in this bill and is unconvinced that such a narrow focus could contribute very much to improved outcomes. But we acknowledge the public’s concern, and we will therefore support the referral of this bill to the select committee so that the public can have some input on this particular issue. Thank you.

METIRIA TUREI (Green) : I take just a very short call on the Building (Late Consent is a Free Consent) Amendment Bill, to say the Green Party will be supporting it going through to the select committee, but we certainly make no promises from that point on. We are interested in exploring the issues. It is true that some councils are able to meet their deadlines on a more regular basis—Hamilton is one example, but it is an extreme and a single one—whereas other councils completely fail to meet the expectations in the legislation. So we do need to have a look at the issue, because it is very difficult for ordinary people wanting to undertake building in their own homes—domestic types of building as opposed to development—and it not fair that they then have to suffer the consequences.

So we are prepared to have a look at it. That is all we are prepared to offer at this stage, and we will see what happens in the select committee. It is worthwhile discussing the bill. It is worthwhile giving people an opportunity to have their say and to tell the committee and parliamentarians what they think about these issues. We will see what happens after that. Thank you.

HONE HARAWIRA (Māori Party—Te Tai Tokerau) : Tēnā koe, Madam Assistant Speaker; kia ora tātou te Whare. The Māori Party takes the view that what is good for Māori has to be good for the nation. When we look at the building and construction industry, we see that our view is the right one, because the construction industry in this country is massive, with $19 billion of expenditure and more than 150,000 people employed, and with heaps of Māori working as architects, designers, plumbers, plasterers, and roofers. We drive the “bullies”, we contract the subbies, and we do the welding, the concreting, and the building. In fact, in the construction industry, Māori really are doing the business. Apart from the armed forces, construction was the only industry to increase its share of Māori employment from 1999-2005—up by a massive 55 percent. The construction industry also contributes some 5 percent of our nation’s GDP and even more to our genuine progress index, which measures sustainability, well-being, and the quality of life. Clearly, the benefits from the building industry have a positive impact on employment, planning, economic growth, warmth, shelter, and family stability.

This bill, the Building (Late Consent is a Free Consent) Amendment Bill, amends the Building Act in order to prevent councils from charging fees when, through their own fault, they are late in getting their paperwork done. In fact, the bill creates a no-fee provision over eight separate pieces of legislation. In simple terms, the bill stops councils from charging people when councils screw up. We want to know from those in the industry—those whom I have just mentioned earlier—whether that will actually reduce building delays, or whether those delays may be caused by other issues. We look forward to the select committee process and to hearing in the Local Government and Environment Committee about the solutions people in the industry may have.

The Māori Party is well aware that the building industry of today has a low uptake in vocational training, which is quite a shock really to those Māori communities that have always taken pride in the chippies, sparkies, and brickies that have come from their ranks. I can remember, back in the 1960s and 1970s, working alongside young men who were doing their trade training through the Department of Māori Affairs and staying at the Māori hostels in Gillies Avenue and Owens Road in Auckland. The department recruited, transported, housed, and supervised those trainees, and technical institutes provided their training. The scheme launched in 1959 as an experiment turned out to be a blazing and spectacular success. It reduced rural unemployment, it let young Māori step into employment in a supportive environment, it produced a pool of trained employees in the building industry, and it provided highly skilled tradespeople. I can remember Mainzeal Property and Construction, one of Auckland’s biggest construction businesses, having an open-door policy on all Department of Māori Affairs trainees, such was the quality of their apprenticeships and their work. With the advent of this latest bill before the House, I cannot help but think back to that scheme and wonder why we are not re-establishing such a scheme to cope with the delays in building management.

We look forward to hearing about what is causing those delays and whether they are actually being created from inefficiency, a lack of planning, a lack of staff, or maybe just plain bureaucratic incompetence. We want to know whether speeding up the process will impact on the quality of the decisions that are made, and we need to know that reducing the fees will not mean reducing quality in the building management process. The Māori Party will support this bill going to the select committee, because any move to reduce costs and reduce delays in such a strong and vibrant industry can only benefit the community at large, the Māori community in general, and the Māori workforce in particular. Kia ora, Madam Assistant Speaker.

GORDON COPELAND (United Future) : First of all, I begin by congratulating the Hon Nick Smith on having his Building (Late Consent is a Free Consent) Amendment Bill drawn from the ballot. I note that the next item on the Order Paper is also in Nick Smith’s name, so he has had a bit of a run of luck in recent times. I am pleased to tell the member in advance that United Future will be supporting the first reading of both of these bills.

We support this Building (Late Consent is a Free Consent) Amendment Bill, at least on the first reading, because we believe that local authorities need to lift their game and become efficient in the processing of consents relating to building issues. I have told the House before that I recently had an experience here in Wellington City, where I was charged $583 for a consent fee for a fence 5.25 metres long. The city council told me that it would refund any of that consent fee that was not used up in the consent process. The council actually used only $503, so it owed me $80. After I told the House that story, the Hon David Parker came across to me and said that it was nothing to do with the Resource Management Act; it was just the sheer inefficiency of my council.

So when I found out that the council owed me $80, I wrote and said that it owed me $80. The council wrote back and said that it took 8 hours to process my consent fee for a 5.25 metre-long fence—a fence for which I had the written consent of my neighbour.

Steve Chadwick: What year was this?

GORDON COPELAND: It was this year. I can tell members that not one single ray of sunshine was shielded from anybody else’s property, and there were no adverse environmental effects, whatsoever. In fact, it was positive for the biodiversity on my property. Wellington City Council said to me that I could not have my $80 back as the council’s policy is not to refund anything less than $100 because it would cost the council more than that to draw the cheque to refund me.

When I have that kind of experience, I say that there is something very rotten in the State of Denmark. We really need to address the wrong kinds of incentives that are there at the moment for many bureaucratic councils. I think it is good to incentivise some behaviour, namely, getting the consents done on time and, as is normal in legislation passed by this House, to impose a penalty for the failure to adhere to statutory timetables. After all, if we as a Parliament put in place statutory timetables and no penalty is attached to breaching them, then we have not made good law but have only given good advice—and good advice, too often, is simply ignored by people who have no real interest in advancing developments in our cities and towns.

I will come back to the point just made by the Hon Clayton Cosgrove that somehow or other this bill will impose extra costs on taxpayers. It need not.

Hon Clayton Cosgrove: Ratepayers.

GORDON COPELAND: Ratepayers, I beg the member’s pardon. It need not. In fact, I believe that the bill will reduce the cost on ratepayers, and I will tell members exactly how it will do that. The logic of extra costs on ratepayers is wrong for two reasons. First of all, we are talking about consent fees. We are providing a service to people who are seeking a consent—people who want to get on and do something useful for their community and for their own private homes. They are the people whom we are charging. If we were to impose penalties, the incentive would be for the council to get the job done quickly.

Furthermore, if that does not work, I will tell the House exactly how we will get the thing fixed, and it is simply this. We either deduct the extra cost to the councils from the chief executives’ salaries, or we drop the chief executives’ salaries and we simply give them a bonus to have the consent fees done on time. That will change everything, because there are chief executives of councils in relatively small cities, such as Wellington, who are paid a great deal more than the Prime Minister. I do not see them having any incentive at all to get on and do these consent fees properly, and that is the aim of this bill.

Let us face it, the aim of this bill is to let development proceed and to ensure that statutory timetables are adhered to, and I see nothing wrong with that, at all. If local authorities do that, then I will put money on it that the delays will disappear overnight if they incentivise their chief executives to have the consent fees done on time. [Interruption] It really has nothing to do—with all due respect to the interjections—with the new Building Act, because the new Act simplifies the consent process by giving certainty to it, and that was one of its aims. So I think that is really a complete red herring.

I signal, with pleasure, United Future’s support for this bill, at this stage for the first reading only. Let us put the matter to a select committee, let us hear the submissions, and let us move this whole process forward as an important way of allowing developments in this country to go ahead, consistent with good standards, but with the lowest possible compliance costs.

BOB CLARKSON (National—Tauranga) : The Labour member Clayton Cosgrove was very robust in his speech. I actually saw sweat running down his face, but I noticed that it was running off one side of his face—he is obviously not level-headed.

Hon Clayton Cosgrove: That’s a funny one, Bob.

BOB CLARKSON: I thought it was pretty good.

The Building (Late Consent is a Free Consent) Amendment Bill is an important amendment to the Building Act 2004. I thank Nick Smith for putting this amendment bill forward for consideration. This member’s bill was drawn out in the first ballot—the Lord works in mysterious ways. It is very necessary that bureaucrats be pulled into line with the law. We cannot allow councils to get away with dragging their feet—there must be some accountability. If consents are late—

Hon David Benson-Pope: Send it to the local councils! Say it again!

BOB CLARKSON: The member should stop rattling.

If consents are in breach of the time frame, a penalty must be paid. I know of cases where consents were held up for many months. The delays cost builders thousands of dollars in lost time. I know of a case where the owner of a project about to be constructed has finally pulled the pin—he has given up waiting. In that case, Tauranga has lost a good business.

I get quite upset when builders wait weeks after the 20-day limit. There is no communication from the council in a lot of cases. The bureaucrat should have a checklist to see whether anything is missing—they use that as an excuse quite often—or whether anything has been done wrong, and they should notify the person who lodged the permit within days of the lodging if something is missing. When councils are busy, they write a letter to builders asking for further information. This stops the clock as far as the 20 days is concerned. The letter takes 3 days to get to builders, so they have already lost 3 days before they can react. If the builder gives the council the information it requires, the clock starts ticking again. Then the council sends another letter asking for more information, and the delay process starts again. This is a ridiculous situation. As I have said before, why does the council not have a checklist and notify builders of any problems once only?

I know of cases where an engineering report was requested about the design of a 12-metre door. Then, 1 week later, the council asked whether the offices had air conditioning. Both of those requests could have been made at about the same time, thus saving a total period of 2 weeks. The 12-metre door was being manufactured by a recognised door manufacturer, and it needed only a producer statement, not a design, when the job was finished. There was no air conditioning in the offices, and the plans showed that. Why did the council ask those questions? It was to slow down the process. In this case, the council stretched 20 days out to 34 days. There has still been no permit issued on the project I am talking about. This is costing the developer $12,000 a week in delays.

Lindsay Tisch: How much?

BOB CLARKSON: It is costing $12,000. The developer paid $6 million for the land. Members opposite may not be able to work it out, but it is $12,000 a week down the drain.

That type of situation must stop happening. There must be a penalty if it happens—that is, no fee will be paid. I think the bill is not tough enough. I would like to see a penalty for every day that the consent is late, or the builder should be allowed to start work if the consent is not issued. That might be too tough on the bureaucrats, but we need to let them know that we mean business.

There is another situation in Tauranga where the time limit of 20 days has been passed. The council decided 6 months ago to bring out new impact fees, and all that sort of stuff. It has had 500 applications for permits in the last couple of weeks. That caused chaos in the council, and it could not process the permits for the simple reason that it had not asked which application was urgent and which one did not matter—it was just trying to beat the impact fee deal. So that has caused major problems, and the Tauranga City Council is way behind.

STEVE CHADWICK (Labour—Rotorua) : The member of the Opposition Bob Clarkson knows a little about building, but, with respect, I point out that he shows a clear lack of understanding about local authorities’ functions. The Building (Late Consent is a Free Consent) Amendment Bill is the most ridiculous bill I have seen on a members’ day. It simply shifts the costs of building consents that take more than 20 days from the applicant to whom? To the ratepayer. Members should wait until the ratepayer hears about this, because there are overheads related to the building consent process that have to be met by somebody. Obviously, the member opposite does not even understand that.

This is simply astonishing from a member who purports to understand building issues processes. That member and members opposite have whinged and carped about Government cost-shifting on to local authorities. It is one of National’s key lines of rhetoric. It is simplistic and naive. Its approach to the building consent process is an absolute flop, because it has completely the wrong incentives. It shows a lack of local government experience, a lack of knowledge about the current building consent process, and, above all, a lack of trust in local authorities.

I have heard amazing speeches that will be recorded in Hansard and will be useful when we go out to build relationships with local authorities. National members say local authorities are just a bunch of bureaucrats who deliberately hold back and delay on the building consent process. Why would they do that? There is absolutely no incentive for them to do so. This bill will add to ratepayer and business costs. We will enjoy going out there and telling local authorities about that. The bill also puts at risk, for building practitioners, development initiatives that are already under way.

A “free consent” is a nonsense notion. The cost has to be met somewhere. [Interruption] I tell Mr Clarkson that this is not about imposing a fine on the local authority. That is not part of this bill. This says that after 20 days, the consent is free. Who will pay for it? The cost will fall on the ratepayer. People will soon know about it. The decision chain—something members opposite purport to understand in their rhetoric about compliance costs—lies with local councils. Who will meet the cost? The ratepayer will. Let us make it right. The wrong incentives are in this bill. It also contains an interesting mechanism: it will stop the clock, as people seek clarification on consent, near the 20-day line. It will slow it down. I do not understand what the member is even trying to attempt.

The bill should not be referred to the select committee. Quality will give way to speed, thus risking safety. In fact, in the Social Services Committee we are currently looking at the weathertight homes legislation, needed because of “speedy” decisions that compromised quality and compromised safety. I cannot believe that the member opposite thinks his bill is a responsible bill. It puts more uncertainty into a currently booming construction industry. That is why there are delays—there is such a booming industry going on. Indeed, 81,500 total authorisations were given out by 30 June this year. That is what is putting the pressure on local authorities, not the process for local authorities.

The Government is doing something about that. It is improving quality and the time lines of the building consent process. It is doing that by auditing, monitoring, and accreditation. All the members opposite know that fact. The registration of building consent authorities will be completed by 30 November 2007. This bill is absolutely silent on building consent authorities. It has so many gaps, one could drive a bus through it. Penalties are not the levers this Government intends to use. We will not be supporting this bill.

Hon Dr NICK SMITH (National—Nelson) : At the beginning of this parliamentary term, the Prime Minister said that the No. 1 goal for Parliament this year should be improving productivity. Yet we have our biggest industry—the building industry—where nearly 50 percent of building consents are not being processed on time and, when faced with a practical bill to address that, the Government sticks its head in the sand. There was not even an acknowledgment from any Labour member that there is a substantive problem for builders, for average citizens, trying to get a practical consent for their particular building project.

I thank United Future, the Māori Party, and the Green Party—

Hon Member: New Zealand First?

Hon Dr NICK SMITH: —well, I understand that New Zealand First is being its normal poodle for the Government—for at least saying that this is an issue that will—

Barbara Stewart: We are supporting it.

Hon Dr NICK SMITH: My sincere apologies. So the Labour Party is the only party with its head in the sand, pretending this is not a real problem.

I address the specific issue in respect of the costs of rates. There is a very simple solution: the councils should do consents on time. If councils process consents within the 20 working days, there is not a penny of cost for the ratepayer. The part that really disturbs me about Labour’s attitude on this bill is that it basically says it is OK for bureaucrats to break the law; it is OK for this Parliament to have a law that says that 20 days—

Darren Hughes: What did the High Court judge say about this?

Hon Dr NICK SMITH: I ask Labour members opposite what penalty they are proposing for a council when it breaks the 20 - working day requirement. The silence is deafening. Basically, they are saying there should be absolutely no requirement for bureaucrats to obey the law. We on this side of the House say there are penalties all through the law for any citizen, any builder, or anybody else who breaks the law, so there should be a penalty for councils if they break the law.

I again draw the attention of this House to the experience of the Hamilton City Council, because it has adopted this policy in its own area. It has been able to have 100 percent compliance. If we look at the survey done by the Sunday Star-Times, we find further that the cost for applying for building consents in Hamilton is perfectly reasonable. So doing this has not put up the cost. In fact, the interesting fact is that some of the most expensive councils are those with the worst record for delays.

Also, in respect of Hamilton, is there any evidence at all to back up the Minister’s claim that this measure would result in a drop in quality? I challenge him to produce the data from Hamilton that show there is any less quality in the building consent processing. What was extraordinary about the Minister’s contribution to this debate was his example of inspections. Well, that is nothing to do with this bill. This bill is about the “consenting” part, where a council has to make a decision as to whether the plans and the application are appropriate to grant a consent.

I say again to this House, this is a $13 billion-a-year industry. This industry employs 150,000 people. I have been inundated with a file one could not jump on, which is full of examples from New Zealanders and builders who are frustrated with the delays, and who strongly support this bill. For example, the master builders, the Certified Builders Association, the Business Council, and Business New Zealand are all indicating strong support for this initiative, because they see it as a practical way in which we can improve productivity and reduce compliance costs.

I welcome the fact that this bill is going to a select committee. Regardless of what Labour says, this is a real issue for ordinary New Zealanders. It is sensible that it goes to a select committee, so that we can then make sure that building consents are more efficiently processed. I am just simply surprised that, again, Labour is on the side of bureaucrats, it is on the side of lawbreakers, and it has absolutely no regard for compliance costs or for productivity. It is good that this bill will get through this House, so that we can address a real, practical issue for New Zealanders and for builders.