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Fire and Emergency New Zealand Bill

The Bill introduced on June 30, 2016 repeals the two Acts governing fire services to create a single, unified fire services organisation. All parties were in support when the Bill was given its first reading on July 5 and sent to the Local Government and Environment Committee for consideration. Reported back on December 23, 2016 with many changes. Much of the focus was on how the levy to fund FENZ would work. Its principal source of funding would be a levy paid on insurance for property, broadened to include insurance for material damage as well as for fire damage. Additionally, the levy would be payable on insurance for motor vehicles against damage or loss. The Select Committee said it was aware of concerns. Amongst the problems is costs would increase substantially in some instances and in disproportion to risk. The Select Committee hopes the levy could be waived or capped in some cases. An example given is exempting public gallery or museum collections from the levy, but still applying it to their buildings or other property. The Bill also lays out ways to crack down on organisations developing structures with the aim of avoiding levy obligations. However, the committee has inserted amendments to “clarify that merely reducing one’s sum insured, or under-insuring, would not amount to avoidance”. Completed second reading on February 15 with just NZ First opposed on the grounds the funding model was flawed and the amalgamation of services would cause problems. Committee stage interrupted on March 14. The Govt also released draft regulations to operate under the law including the broadening of levies on insurance including residential property, non-residential property and motor vehicles with different levy rates or caps. This includes regulations to provide levy exemptions for policyholders who face an “unreasonable burden” with a proposed time limits on exemptions. Committee stage again interrupted on April 11 with just NZ First indicating opposition. Committee stage completed on May 2 and third reading on May 5 with NZ First still the only party in opposition.  Fire and Emergency New Zealand Bill