19 June 2018

Overseas Investment Amendment a dog of a Bill

The Government’s Bill to ban foreign buyers is a textbook example of bad law-making and the changes made at select committee will do nothing to alter the fact it’s a dog, National’s Finance Spokesperson Amy Adams says.

“National, along with countless experts, has repeatedly told Labour that the number of foreign buyers in New Zealand is very low and there is no evidence they are significantly driving up the cost of housing or taking houses from New Zealanders.

“Yet after cynically blaming foreigners with Chinese-sounding names, the Government has pushed ahead with the Overseas Investment Amendment Bill without proper policy development which has forced it to make several unworkable, poorly thought-out changes.

“Forestry investments have been given a free pass, while the same investments into viticulture have been effectively blocked without any clear justification for the distinction between the two.

“For residential properties, as 90 per cent of submitters pointed out, the Bill will do the opposite of what is intended which is to make housing more affordable for New Zealanders.

“To address housing affordability we need to build more houses, but banning all but a few foreign buyers will mean fewer housing developments proceeding at a time when we need to grow our housing stock.

“The Bill will also hamper the ability of New Zealand businesses to access foreign capital in order to expand and impose significant costs and delays on the housing sector.

“It also appears that the Government now thinks it will be able to pick and choose who of New Zealand’s trading partners will be able to invest in our housing market. First Australia, and now Singapore, have been carved out – and with trade negotiations looming with China, the EU, and the UK, who’s to say they won’t also demand an exemption?

“Furthermore, changes to the Bill make clear that if foreign individuals not already exempt from the ban make their case right, Ministers may also give them an advance green light to purchase whatever properties they like here. Just what sort of ‘case’ they would need to make remains to be seen.

“The changes in this Bill are not based on any clear or compelling evidence and are against the weight of submissions.

“It’s become a hallmark of this Government to not listen to evidence and advice it doesn’t like, so now we’re in a situation where its own Bill is likely to worsen the problem it is trying to solve.

“It’s about time Ministers stopped thinking they know better than the experts and started listening to the evidence.”

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