In August 2017, in the middle of the election campaign, Jacinda Ardern promised a rail connection between Hamilton and Auckland to be fast tracked (pun absolutely intended) so that it would be completed within 18 months. My calculations indicate that the rail connection should therefore be operating in April 2019.
So how is it going, Hamilton commuters? I realise the disruption while the rail system was being built or upgraded must have been annoying, but the end result, which must be just about there now, is worth it… right?
Labour has promised to fast-track a rail connection between Hamilton and Auckland.
Railways will ease congestion, Labour leader Jacinda Ardern said on Monday, but billions of dollars of roads will not.
Ardern pledged in front of a teeming crowd in Tauranga her party “will bring rail back within 18 months of taking office”.
The $20 million plan will use the existing rail network to run commuter trains between Tauranga, Hamilton and Auckland – also known as “the golden triangle”. [August 2017].
Dear me. It sounds as if Twyford is still in campaign mode, complete with stardust and unicorns. Commuters need more than vague promises about modern rail services being ‘one day on their way’. It is a bit like promising to build 100,000 houses in 10 years, with all of them being built in year 10, which is the ridiculous situation we seem to have at present.
Also, with the ‘pre-implementation plan’ being developed in early 2019 (which is now), knowing how long these things generally take, any expectation for the rail connection to be operating at any time in 2020 seems a bit optimistic, don’t you think?
Let us not, however, fall into the trap of thinking that this is another broken election promise though, comrades. As the Minister for Transport (and Housing and Urban Development) pointed out recently, promises made by Jacinda before she became prime minister do not count for anything. They were just lies, designed to get her and her bunch of inept fools into government. It is only those promises she has made SINCE becoming prime minister that can be taken as genuine.
If Kiwibuild is anything to go by, let us say her record there is not crash hot either.
Anyway, I just hope the commuters of Hamilton, as they sit in gridlocked traffic, understand that promises made by someone trying to get elected are meant to be ignored. I do hope no one voted for her on the basis of those false promises.
But don’t worry. The rail connection she promised will be here ‘one day’. Don’t ask when ‘one day’ is, though, because no one knows.
The first promise Jacinda Ardern made as Labour leader looks to have gone up in smoke.
During her first big public outing as leader during the election, she promised rail for all – including a line from the Auckland waterfront to Dominion Rd to Mount Roskill, all to be completed by 2021.
The promise was part of a $15 billion package and came with a plea from Ms Ardern – she needed cash to fund it.
The bad news continues for this ramshackle government. Unemployment has risen to 4.3%, from 4% in September.
It may be a small increase and the government will be able to play it down as being close to the margin of error, but it is part of an emerging trend. Growth is slowing, unemployment is increasing. The economy is starting to soften and we need a competent government with strong economic management skills to guide us through the storm.
We don’t have such a government. quote.
Unemployment jumped at the end of 2018, as the number of new jobs being created slowed.
Statistics NZ said on Thursday that unemployment climbed to 4.3 per cent in December, up from a revised 4 per cent in September.
The New Zealand dollar dropped on the latest figures, as the market bets on whether the figures make an interest rate cut from the Reserve Bank more likely. end quote.
Adrian Orr predicted an interest rate cut last year but there was no reason to think it necessary at that stage. After a decade of low interest rates, it seems they are about to get even lower. quote.
Most of the climb in the number of unemployed – which rose by 10,000 to 120,000 – was due to unemployed men. The number of men unemployed rose by 8000 to 65,000, while the number of unemployed women rose by 2000 to 55,000.
Economists had expected a small increase in the unemployment rate, after a sharp drop in September, but not to the degree the household labour force survey revealed.
The bad news, as always, is that the worst affected group is the young people. NEETs, as they are known, with no training, now have less and less chance of finding employment. The government claims that it will target these people, especially Maori youth, but… well, they also said they would build 1,000 houses by July 2019. quote.
On Thursday, Employment Minister Willie Jackson released a statement describing the unemployment rate as “the second lowest in nearly a decade”, focusing on lower unemployment for women and Māori since the coalition Government took office.
“The results released are in keeping with our expectations for this quarter and we are confident that in this strong economy, if we continue to listen to employers and work with industry, many people looking for work will find more opportunities to do so.” end quote.
Sorry, Willie, but you have got this wrong. The economy is not as strong as it was. The growth numbers for the December quarter are not out yet but they are likely to show a significant slowing of growth. You can no longer rely on the excellent economy that you were handed to get you out of trouble. It is downhill all the way from here. quote.
National’s finance spokeswoman Amy Adams said the figures suggest the economy may be slowing and the Government should take it as a “reality check”, with the number unemployed climbing, while those not in employment, education or training (so-called NEETs) rising by 26,000.
“The unemployment rate is still relatively low, however we have now slipped from having the 9th to the 14th lowest unemployment rate in the OECD. At the same time, jobs growth has stalled and the underutilisation rate has increased.
With gale force winds blowing our way over Brexit and the China-USA trade situation, an economic slowdown looks inevitable. The real question is how well our government is going to be able to deal with it. I have no confidence in their level of economic competency. It looks as if Shane Jones will not be getting his ‘nephs’ of the couch for some time yet.
Prime Minister Jacinda Ardern says her housing minister was wrong to call Treasury officials ”kids” – but has sided with him in disagreeing with their view that the Government’s Kiwibuild promises are too ambitious.
But rather than get personal, the Government would “just get on and build houses” to prove Treasury wrong, Ardern said.
Housing Minister Phil Twyford last week slammed the “kids at Treasury” over an analysis that halved the impact Kiwbuild would have on residential construction, which contradicted a sunnier forecast from the Ministry of Business, Innovation and Employment.
In the Budget documentation on Thursday, Treasury analysts reduced the amount of additional residential investment they believe the Government’s flagship Kiwibuild policy will bring in by 2023, down from $5.4b in December to $2.5b last week.
The prediction does not point to the number of homes actually being built, but does look into the value of additional residential investment as part of the home-building scheme – value that mostly comes from actual home construction.
Twyford called Treasury “kids” who were ”fresh out of university and they’re completely disconnected from reality”.
Ardern said she and Finance Minister Grant Robertson also disagreed with Treasury over its Kiwibuild forecasts.
“In fact MBIE take a different view from Treasury and that’s not unusual … we often have two government departments with competing views.
“One of the things Treasury hasn’t taken into account, for instance … some of the elements of Kiwibuild which include buying off the plans so there are some different mechanisms they’ve used to make those forecasts.”
Twyford’s comments have upset public sector union the PSA. Its national secretary, Glenn Barclay, said it was disappointed by the minister’s “personalised” comments.
“It is public servants’ job to give free, frank and fearless advice to politicians. Sometimes, this will involve giving those politicians advice they do not like – but that is their role in ensuring an open and transparent democracy,” Barclay said.
“The age of the public servants who prepared this advice is irrelevant, as their work is endorsed by their Department – in this case, Treasury. We would hope the Minister reflects on this incident and chooses not to take this tack in the future.”
OPINION: When project deadlines start blowing out, its only ever downhill from there.
Longer delays, greater costs, more corners being cut to try and get it back on track.
KiwiBuild was never going to be able to reach the milestones the Government had set – not without significant reform of the Resource Management Act. And yet, it could prove to be the most unforgiving policy to get wrong.
But then, Labour never fully expected to be enacting it when they made the grand election promise
Of all the promises to break though, this is the one inextricably linked with the Kiwi dream. Now the Government has officially scrapped its first term building targets and the policy isn’t just in danger of failing – it is failing.
The housing shortage is a big and tangible problem, affecting hundreds of thousands of Kiwis, and there were countless times on the campaign trail when Labour leader Jacinda Ardern and her MPs literally said “we will fix the housing crisis”.
With the admission the Government would only be able to build 300 by houses by July 1, Housing Minister Phil Twyford has all but confirmed the rest of their deadlines are likely to blow out too.
And as much as Ardern tries to claim the longer deadline to build 100,000 houses in 10 years is still on, no one’s kidding themselves. Their flagship policy is six months in and already a dead duck.
Let’s not pretend National has any credibility on housing, either.
With the amount of gleeful hand-rubbing going on, one would think the previous Government took bold and wide-sweeping action at the outset of a burgeoning crisis, rather than adopting the political equivalent of sticking one’s fingers in their ears and singing “LA LA LA”.
But that Twyford had to announce he was “recalibrating” the policy just a day after his Prime Minister branded 2019 a “year of delivery” for the Government, it’s probably too much to ask National’s housing spokesperson Judith Collins to keep herself contained.
And as the Government drafts legislation to allow the confiscation of land to build houses – against the advice of officials – Twyford’s response to the collapse of this policy has more than a whiff of desperation about it.
It could not have been a worse start to the year for the Government.
Fresh from an international trip where Ardern dazzled, she might have hoped to begin the year with a visit to Waitangi that mirrored last year’s exultant celebrations, a caucus retreat where MPs brimmed with strategy ideas, and to deliver an economic speech that neatly positions the Government as “economic visionaries”, winning over business on tax reform and fair pay agreements.
KiwiBuild’s stumble has put paid to that, and a surprise commitment from National leader Simon Bridges has backed Finance Minister Grant Robertson into a corner, with the apparent argument it’s not feasible to index income tax brackets to inflation.
If both parties are starting how they mean to go on, then the return of Parliament is unlikely to be a gentle start to the new political year.
Policy achievement seems to run a distant second to colour in politics these days but, despite that, the Government and Jacinda Ardern cannot ignore some difficult decisions ahead, writes Peter Dunne.
When Parliament resumes in a couple of weeks the Prime Minister may well be reflecting wistfully on her time in Davos and the adulation she received for saying nothing of substance, but smiling ever so sweetly as she did so.
Helen Clark was correct in her assessment that so much of the Prime Minister’s international appeal is the difference she cuts between her and other leaders. She is young, enthusiastic, and radiant – not the glowering bully of the United States President, nor the stubborn grimness of the British Prime Minister.
In a world of political grayness, she is a bright spark of colour, but the sad thing is that seems to be all that matters these days. Policy achievement seems to run a distant second to the new show business of contemporary politics.
The Prime Minister is not the first New Zealand leader to have been admired on the world stage, or to have found its lure attractive. Most have taken it in their stride, although one or two have let it go to their heads.
Walter Nash was an inveterate international traveller as Prime Minister, practising what he saw as international “summitry”, but generally treated as a nice old man from the colonies, while David Lange found the international stage fitted so well that he quickly lost interest in and control of what his government was up to domestically, with disastrous results when he realised, and tried to reassert his authority. For his part, Sir Robert Muldoon saw himself as a potential international economic saviour through his promotion of a reformed Bretton Woods agreement, a course few others seemed interested in following.
So when the Prime Minister flops back into her comfortable green leather seat in the debating chamber when Parliament resumes, it will be perfectly understandable if her mind starts to drift back to the excitement of Davos, rather than the comparative drudgery of how to rescue the rapidly crumbling Kiwibuild programme, what to do with the recommendations of the Tax Working Group, or how to balance the mounting calls from China and the United States to take one side or the other in their ongoing tussle for dominance.
All will require difficult decisions – something this Government has hitherto run a mile from, preferring instead the comfort blanket of another review group.
Given that Labour has been talking about Kiwibuild for the last two, if not three, election campaigns, it is a mystery bordering on a scandal that when it did come to office it seemed to have little idea how to implement it.
Much of what this Government has been about so far is scene setting, painting a picture of the positive future it has in mind for the country. That is a laudable and sensible approach, but the problem is that as the midpoint of its term nears, there are as yet not too many visible, specific examples of this positive future in effect, and with the next election only the end of next year away, time is beginning to run out.
That is what makes the omnishambles of the flagship Kiwbuild programme all the more spectacular and politically serious.
The dramatic failure to come anywhere near previously expressed target levels for Kiwibuild houses risks becoming a metaphor for the entire Government programme across all portfolios.
Given that Labour has been talking about Kiwibuild for the last two, if not three, election campaigns, it is a mystery bordering on a scandal that when it did come to office it seemed to have little idea how to implement it.
It is all very well blaming officials, or in the ridiculous case of the National Party support partners who would not allow it to tear up the Resource Management Act, because the reality is the failure lies fairly and squarely on the shoulders of the Minister who was Kiwibuild’s architect and champion for so long in Opposition that one might have been forgiven for assuming he had some idea of what he was talking about. For the sake of her government’s credibility, not to mention the thousands of young families who saw Kiwibuild as a potential answer to their housing concerns, but are now becoming disillusioned, the Prime Minister needs to ensure her government averts this mounting disaster – and quickly – before it engulfs them.
If the Minister is not up to the task, an increasingly likely proposition, he needs to be replaced by someone who is. Equally, if he magically reveals how he can now do the job, he needs to be given every support to get on with it. Either way, the Prime Minister faces tough decisions, far removed from the unreality of Davos.
The report of the Tax Working Group is due imminently, with much focus likely on how it addresses the capital gains tax question. Remember, it was Labour’s policy at the last two elections to introduce a capital gains tax, but during the last campaign, the Prime Minister kicked the issue to touch when the heat started to rise, by promising a review, with no changes due before 2021. Well, now the review is over and its report eagerly awaited.
The review head, Sir Michael Cullen, has always favoured a capital gains tax and was only stopped from introducing one during the last Labour-led government by coalition politics and an obstinately negative Revenue Minister. So, it is a reasonable bet, that now freed of such constraints, Sir Michael will seek to achieve his ambition this time.
Either way, that poses a problem for the government.
Acquiescing to Sir Michael’s wishes will leave many people feeling cynical that the whole review process was merely a cover for implementing Labour’s intended policy anyway, and will leave the government going to the next election having to campaign for a looming capital gains tax, to the relish of the National Party. Rejecting any such recommendation, will leave the Government with nothing, unless skillful and tough political leadership can negotiate a shrewd and acceptable compromise, which seems unlikely.
And then there is the matter of the mounting tension between China and the United States.
Both are important to New Zealand which is why we have so far prudently avoided taking obvious sides in the growing argument. However, there are strong signs that we may not be able to do so for much longer. China has already made clear its displeasure at the GCSB’s decision to exclude Huawei from the 5G upgrade process, with there being strong suggestions that the Prime Minister’s long-heralded visit to China was not just delayed, but deferred indefinitely (in other words, cancelled) by the Chinese as a consequence.
China is hugely important to New Zealand as a trading partner so maintaining and enhancing that is equally important for our growth and prosperity, something the Chinese understand all too well. But now, pressure is also coming from our Five Eyes intelligence partner, the United States, to back it over China, so the luxury of not taking sides may not last much longer. The United States already sees New Zealand as somewhat flaky in terms of Five Eyes, and in the volatile environment the President has established, escalating this perception will not be to our advantage in terms of the wider relationship.
The realpolitik of having to deal with these situations, let alone the likely teachers’ strikes, the ongoing junior doctors’ dispute, and a range of other day to day problems, are a world away from the acclaim of Davos. But it will be how she responds to these issues, and the level of leadership she shows, that will determine the Prime Minister’s standing with New Zealand voters as 2019 unfolds.
Kiwibuild is a failure. The government has decided to stop interim measurements, saying that they are not ‘helpful’, which just means that they have been unable to meet their targets. The scheme has not been abandoned all together though. Twyford has a cunning new plan. He wants to seize land for housing. Private land. quote.
KiwiBuild is seriously struggling to gain momentum, and Housing Minister Phil Twyford has a trick up his sleeve that he hopes will bring the scheme back to life: an Urban Development Authority.
But his officials have warned it will have a detrimental impact – made worse by the fact private companies or people could make money off the land grab.
The minister is working on legislation to give the Urban Development Authority powers to build quickly – including the ability to force landowners to sell up if they need the land for housing. end quote.
This has an ugly feel to it. Yes, the government has always been able to do this, for roading projects for example. Instead of forcing councils to rezone land, or allow more land to be released for housing, Twyford wants to seize it from private owners. Instead of converting conservation land, which is often nothing more than scrub land in some areas, Twyford wants to seize it from private owners. The government has lots of options to consider to release more land for housing before it needs to think about seizing it from private owners. But guess what? That is his first thought. quote.
See what I mean? It doesn’t sound as if seizing land will be the exception rather than the rule. It sounds as if it is likely to be the first resort. quote.
Property commentator Ashley Church says the agency will be too powerful.
“The scary aspects of it are that it’s going to be able to do much more quickly things that we’ve either expected to be able to consult on or which impact on our private property rights in a way.” end quote.
This is very worrying. Up until now, seizing land has only been for infrastructure projects. Never housing. quote.
Officials have warned that a drop in public confidence in property rights would be exacerbated by the fact the model proposed enables private actors to make a financial gain – that means developers profiting from Government land grabs.
“I think this is the key issue, and I think it’s why there is no history of doing this in New Zealand until now,” Mr Church said. end quote.
Absolutely. Until now, the rights of private landowners have been sacrosanct, except in a very few, special cases. This may be coming to an end. quote.
Mr Twyford is looking at new ways of compensating landowners the Government forces out, including offering up shares in the new development.
Of course, the government could always compensate landowners by paying them the market value of the property? Even that will not be good solution for everyone, as people hold land for lots of reasons, but technically at least the owners would not be out of pocket. It does not appear though that this is going to be the standard approach.
The ability to own property has been a right of New Zealanders ever since the country was colonised by the British. Now it seems the rights of property owners are going to be diluted. Make no mistake, New Zealanders. Our new communist government will make sure we are all equal in the eyes of the law. Soon, no one will be able to own anything.
WELLINGTON, New Zealand — When New Zealand’s housing crisis became so bad that one study found only Hong Kong less affordable, the country’s prime minister came up with a solution: An ambitious plan to prompt the construction of 100,000 new homes over the next decade to help ease prices.
But on Wednesday, the government of Prime Minister Jacinda Ardern said it would scrap its initial targets after failing to meet them, with just 47 of the 1,000 homes it had promised by July built so far.
Those numbers suggest that an answer to the worsening shortage is still years away, and the acknowledgment came as a new study showed that housing had grown more unaffordable around the country, with property priced further out of reach than in the United States, Britain and Australia.
That study, the annual Demographia International report, compared median house prices with median income in cities in seven wealthy countries and in Hong Kong; data from the third quarter of 2018 suggested that only Hong Kong was less affordable than New Zealand, where the country’s median house price was 6.5 times the median income, up from 5.8 in the same period a year earlier.
Hugh Pavletich, one of the report’s authors, said housing had become more affordable in Australia over the past year as prices fell amid tightening credit. He said that Ms. Ardern’s government, which took office in October 2017, had been “messing around” by focusing too much on the hotly debated plan to build 100,000 more houses — called KiwiBuild — instead of freeing up more land for construction, which he said could have kept prices in check.
“If they’d got out of the starting blocks with structural reforms centered around land supply and infrastructure financing soon after the election, it would have sent a far clearer signal to the market and subdued it significantly as these changes were put in place,” he said.
But the center-left Labour Party that Ms. Ardern leads has now conceded that its flagship policy will not ease the housing crisis as rapidly as it had hoped. The prime minister told reporters Wednesday that the government would still build 100,000 housing units in a decade, but that its interim targets would be scrapped.
The government now expects to have 300 new homes built under the plan by July, rather than the original plan for 1,000.
Phil Twyford, the housing minister, said Wednesday that there would be a “recalibration” of the policy, noting that demand for the new homes in some areas had been weaker than expected. KiwiBuild has faced criticism from political opponents that even its cheapest houses are too expensive for first-time buyers who had been shut out of the market.
“No government in the last 40 years has seriously tried what we are trying to do,” Mr. Twyford told reporters. “And that’s change a failed market.”
Prime Minister Jacinda Ardern’s government has an ambitious plan to help add 100,000 housing units over the next decade.CreditMarty Melville/Agence France-Presse — Getty Images
He said in separate emailed comments on Thursday that the government was also setting up new ways to finance infrastructure for housing while loosening planning rules.
“We have built 1,000 new state houses since we came to office,” Mr. Twyford said, referring to public housing separate from the KiwiBuild initiative, adding that the government had put 1,800 families into those homes. There are more than 11,600 people and families on public housing waiting lists, according to government figures.
Shamubeel Eaqub, a housing economist with the consultancy Sense Partners in Auckland, New Zealand’s largest city, said he was not surprised that the construction industry and buyers had not warmed to the KiwiBuild program.
Neither the building nor purchasing of KiwiBuild houses is subsidized by the government, which only acts as a guarantor to facilitate the building of affordable properties. It also decides who can buy such units to ensure they go to first-time home buyers who earn less than the designated income cap.
“The government is telling builders to use exactly the same processes we have in place now, but build cheaper houses,” Mr. Eaqub said. “That’s why you’ve seen very few builders participate.”
He added that New Zealand’s housing shortage had worsened because construction was a “cottage industry” that had not grown to meet demand, and had not focused on the kind of tract building common in other parts of the world.
The country is half a million housing units short of demand, he said, and because successive New Zealand governments had not been involved in homebuilding for decades, inexperience had led Ms. Ardern’s party to misjudge their targets.
The Labour Party took power after nine years of center-right government with a promise to tackle affordable housing after a national outcry ignited by news reports about homelessness and families living in their cars — particularly in Auckland.
But the latest Demographia figures show the problem has spread. All of New Zealand’s major cities were rated as “seriously” or “severely” unaffordable, with a house in the least expensive city, Palmerston North, priced at five times the median income.
Mr. Pavletich, one of the report’s authors, said smaller markets like Tauranga, a coastal city on the North Island with a population of 128,000, had seen an influx of people who had left Auckland in search of more affordable housing. Average property values in Tauranga had risen to $497,000 from $304,000 in the last five years, and Demographia now rated it among the 10 least affordable cities in the world — along with famously expensive locales such as Hong Kong, San Francisco, Sydney and Vancouver, British Columbia.
Mr. Eaqub, the housing economist, said the scale of the problem was such that it would take decades to fix, regardless of whether the government could accelerate KiwiBuild.
“It’s not something that can be affected quickly,” he said of the housing crunch. “We’re just really short of houses.”
Correction: A push notification mischaracterized the plan to ease New Zealand’s housing crisis as having failed. It should have said that the government failed to meet its initial targets.