I apologise to other members of the committee, but am grateful for the questions—I counted, I think no fewer than six—from Arena Williams.
Going through those in turn: first, the benefit in terms of increased competition and adding some price pressure in a positive way for the Kiwi consumer is based on the idea, of course, that in a market economy the greater the degree of competition, the more that the price of the product—or the goods; or goods or services, for that matter—will tend towards the minimum at which it can be produced—including, of course, that with the benefit of innovation, one can get to that point much more readily. So we think that’s a useful mechanism. Countries like New Zealand have believed this for many years, and it was highlighted in the 2022 Commerce Commission report on building materials, on which the idea for this legislation is partly based.
I would just add, in addition to that point around competition and therefore price pressure, that innovation—which the member also, rightly, mentioned—and, of course, resilience are the aims of the bill in terms of opening up the availability of products from different places around the world.
Second, in terms of the standards, the assurance that we have given and that we will rigorously hold ourselves to as a Government—but relying on expert advice—is that the standards be equal to or higher than those that currently apply in New Zealand to the respective building material types.
Third, in terms of decision making, who oversees? I actually originally wrote the word “overseas” incorrectly—it’s “oversees” in the sense of oversight as opposed to non - New Zealand jurisdictions. So thank you for confusing me on that point, if not the others.
In terms of the oversight, then, that is provided, clearly there’s a process that’s set out in the legislation. And without going through it fully, I will note that, of course, the Minister for Building and Construction, from time to time—like the chief executive of the Ministry of Business, Innovation and Employment (MBIE), who has similar powers in terms of being able to approve products—is guided by the advice of MBIE. In turn, that is informed by expert opinion from outside MBIE—acknowledging there is expert opinion within MBIE as well—industry expertise; and, of course, all the users of these materials are able to contact the Government and be part of that discussion. The broader the discussion is, the more helpful it will be in terms of providing the kinds of materials, products, and therefore outcomes that we will see.
Fourth, in terms of how there is a streamlining effect: the member asks—and I hope that I’ve understood her question correctly—how we avoid the possibility that there might be unintended consequences whereby people who are already going through a different process might experience delays by seeking an approval under this mechanism. The answer is that this is an additional method by which products could be approved. If a tradesperson or a consumer—the Kiwi battler seeking to have a home built at a reasonable price—is already in the stages of getting approval through their local building consent authority or through the CodeMark regime, maybe on the basis of brands testing taking place and giving some comfort or assurance there, then they’ll be welcome to continue to do that. We’re not taking that pathway away; we’re actually increasing the range of methods by which it will be possible to have building consent or products approved.
In terms of protections, in terms of the assurance, again, leaning on expertise rather than it being the Minister himself—or herself in the future, as it may be—making the decision. So the assurances, for example, by reference to the Building Advisory Panel who are available for purposes such as this, providing that expert advice to Government.
Finally, for now, in terms of the point that the member rightly makes, that 90 percent of products at the moment are already sourced either wholly or in part from overseas, and thinking about the innovation that’s taking place in this country—of course, she’s right to reference the technique whereby waste materials are turned into boards. In fact, there’s an example of that a stone’s throw away in terms of the work that’s going on—it actually will be part of the new parliamentary precinct. Certainly acknowledging that point and those within New Zealand who are doing that work.
A couple of points: first of all, of course it’s important to consider suppliers, but from the consumer point of view it’s also worth considering the effect of competition being advantageous to them. But more importantly, from the suppliers’ and manufacturers’ point of view in New Zealand, the fact that they can measure their work against overseas standards, have that accepted in New Zealand, and immediately be export-available and export-ready and export-attractive, I think, would be actually quite helpful for them indeed. But, of course, it will always be easier for Kiwi suppliers and manufacturers because you don’t have the export costs and supply chain implications that those from overseas currently face.