The Government’s much vaunted overseas house buying ban legislation has emerged from a Select Committee with a whole heap of exemptions and loopholes.
Ironically the Committee originally proposed an exemption which has now been ruled out by the Speaker for a company associated with a Queenstown businessman who has been behind some of the biggest and most expensive real estate developments aimed at overseas investors.
So the Government tried to legislate an exemption for one businessman. This is of course what they campaigned on.
Singapore has been entirely exempted from the legislation for reasons that the Minister in charge of the Bill, David Parker is unable (or unwilling) to elaborate on.
They Government claimed they were confident Singapore would agree to change their FTA with NZ. They were wrong.
But perhaps the most surprising thing about the Bill is that it now contains powers for the Government to exempt whole classes of proposed sales from the legislation.
So, for example, a Government could exempt all urban houses.
And it also contains a power for the Minister to exempt any “transaction, person, interest, right or assets from the requirement for consent or from the definition of overseas person or associate or associated land. “
So what we’re going to see is crony capitalism, where the Minister will decide who will and will not be exempt.
But one Queenstown developer told POLITIK that the likely consequence of this would be that it would provide a field day for lawyers seeking exemptions for their clients.
The law is a nonsense. Official stats have shown the impact on house prices of foreign buyers is minimal.
What had the potential to be even more controversial was a proposed clause which has now been ruled out on procedural grounds by the Speaker which would have given an exemption to a development involving an American billionaire, Queenstown developer and a northern hapu and iwi for an upmarket beachfront subdivision north of Auckland being marketed overseas.
Ironically the 106 sites beachfront subdivision at Te Arai which was the subject of the exemption was strongly criticised last year by the-then local MP, Winston Peters.
“Why do Kiwis, going about their lives as best they can, have to fight every step of the way to preserve what is their right against a billionaire developer from another country and a complicit government? “Peters said.
The Minister in Charge of the Bill, David Parker has a fringe association with one of the developers, John Darby. Both were involved with the late rich-lister and Otago businessman, Howard Patterson.
So a billionaire developer was to be exempted.
But that was opposed by Parliament’s Clerk on procedural grounds in that a public act cannot apply to “a select group of people”.
Nevertheless, the Government used its majority on the Select Committee to disregard that advice and maintain the exemption in the Bill when it was returned to Parliament.
Speaker Trevor Mallard, however, stopped it there and removed the exemption from the Bill.
Thank goodness for this. But let’s remember the Government tried to legislate these exemptions.