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National again subsidises their land banking contributors from taxpayer funds.

Written By: - Date published: 8:41 am, July 24th, 2017 - 25 comments
Categories: auckland supercity, bill english, C&R, Economy, im/migration, local government, national/act government - Tags: ,

The announcement that National were granting infrastructure funds to develop housing projects in the far north and south of Auckland caused me some amusement.  The Auckland council has wisely been resisting this particular boondongle that only benefits land bankers , speculators and their political party (National) for some time.

National ministers and other speculators at Drury

Essentially to make a housing development viable, you need to put in water, sewerage, power, telecommunications and roads first. The traditional way that this happened was that it was rorted out of the various councils and the transport bodies by intense lobbying by the developers and their mates in the National party. This is the primary reason that over the last 60 years that Auckland has tended to sprawl outwards.

The equivalents of the NZ Transport Authority in the past and present build motorways. The councils through the National surrogates like Citizens and Ratepayers get roads and services around those motorways. This is extorted from existing rate payer base either directly or in the form of loans they have to repay.

National gets the gratitude of some well heeled roading companies, property developers, companies selling cars and probably some of the voters living in very expensively tax and ratepayer subsided unsustainable urban sprawl. Eventually the ratepayers pay back the loans that the central National government forced them to take out, and can be milked for more.

To make this work, public transport must be constrained by tearing up the tramways as National did in the early 1950s, and then systematically underfunded by NZTA.

Unfortunately National lost the keys to this particular rort back in 2010 when they let National junior (Act) try to run Auckland. In the usual adolescent style Act went for broke and created a council that was too small and centralised to easily use divide and conquer tactics on. Despite separating the saleable bits into ‘council controlled organisations’ who appear to be accountable to no-one apart from central government who appoint much of their governing bodies, they caused the situation that the council members became responsible for much larger constituencies who’d just as soon get rid of them if they played those silly games. In particular, Aucklanders aren’t willing to pay for the infrastructure costs of new subdivisions. They want the infrastructure that they are currently paying for to work better instead.

This has meant that the Auckland local government has started to concentrate on Auckland issues, to the increasing frustration of National government ministers. They have refused to pay for extending their commitments beyond what they already have. Bearing in mind that currently the National government is parachuting about 40,000 people into Auckland each year from nett migration (from about 70,000 for NZ) without any consultation and dithering on paying for them, this is a quite understandable reaction.

From the perspective of the council and the ratepayers that they represent, putting in infrastructure more than 36 kilometres (Drury) or 28 km (Dairy Flat) from the city centre over already crowded transport infrastructure make absolutely no sense. It diverts needed funds away from the public transport and the crowded roads required for industry that is so desperately needed in the existing city.

Moreover the tiny trickle of housing from it – reported as being about 12 thousand over a number of years (which based on past National minister performances means that we’d be lucky to get 1200) doesn’t approach the level of central government forced inwards migration to Auckland.

Since central government is willing to put up the money for these private fiefdoms, I’d suggest that Auckland take advantage of it. Charge full market rates for these unwanted connections to the city systems. Put a substantial charge on sewerage and water connections, and toll the use of our rail and roads. Lets see if we can recover some of the costs of this governments reckless migration policies.

25 comments on “National again subsidises their land banking contributors from taxpayer funds. ”

  1. Bearded Git 1

    “Lets see if we can recover some of the costs of this government’s reckless migration policies.” would better read “reckless migration and city sprawl policies”.

    Agreed the policy is an election-bribe for mates joke. Given the fact that the Unitary Plan now permits massive intensification of housing in Auckland, this is the direction the government should be pushing, not sprawl.

    (BTW LPrent the heading should read “subsidises”)

    • lprent 1.1

      Fixed the title… That is the problem when you dash off a post in the 20 minutes between coffee and commuting

  2. Keith 2

    Great analysis.

    What really made me laugh in irony this morning was hearing the lie trotted out from National that by taking the infrastructure costs away from their developers, this would make housing cheaper. Yeah right Steveo!

    I clearly recall this very same lie back in the 90’s, developers promising that if the industry were deregulated and wonderful things like untreated “kiln dried timber” be used in housing construction, then the savings would be passed on to the consumer.

    That never happened, it only fattened the profit margins for industry players and saw the rest of us picking up the tab for what seemsblike a never ending stream of rotting leaky houses.

    This so called $600 million fund is a mirage intended as a pool of taxpayer money for Nationals property developer donor mates to maximise return on investment to shareholders. Fuck off you bludging scum!

    • Brigid 2.1

      But using kiln dried timber for interior framing never was the problem. Interior framing timber has only ever been treated to prevent borer infestation. Before radiata was used for framing, untreated native wood was.
      The rotting of leaky homes was a result of inappropriately fixed exterior cladding and stupid Mediterranean designs not fit for this climate. Plus the fact that some cladding was not fit to clad a chook house.
      But yes, all driven by the neo liberal philosophy.

      • Tamati Tautuhi 2.1.1

        The Building Supply Companies put the pressure on the Government and the Local Councils to change the Building Codes and that is a fact.

      • lprent 2.1.2

        The rotting of leaky homes was a result of inappropriately fixed exterior cladding

        All structures will leak given time. A layered defense just makes sure that the damage is minimized over the lifetime of the structure. So when the cladding failed the trick was to make sure that the damage didn’t cause too much more damage.

        So you don’t have interior structures that allow pooling of water. Usually interior cavity and proper drainage.

        If you don’t then wood, steel and even concrete will rot. If it was treated timber, untreated timber, stainless steel or whatever don’t do anything except change the time period.

  3. Ad 3

    +100 LP

    And in this case, here’s the tie in between the roading supplies builder Stevenson’s Drury quarry, and the developer, to tie the ends in nice and tight:

    “Kiwi Property plans new town centre next to Stevenson’s Drury development

    on Friday 7 April 2017 in Drury,

    Kiwi Property Group Ltd has bought some of 51.3ha at Drury, with agreements to secure the balance, to create a new town centre next to Stevenson Group Ltd’s mostly industrial 360ha development site.

    The 3 greenfield sites are next to the junction of the Southern Motorway, Great South Rd and the North Island main trunk railway line, 35km south of Auckland’s city centre.

    Kiwi chief executive Chris Gudgeon said in a release today the company had acquired some of the land, and had secured agreements to acquire more, as a strategic long-term holding to capitalise on Auckland’s continuing population growth.

    “Our vision is to develop a town centre to complement the existing Drury town centre, which would be staged over the next 20 years to coincide with predicted population growth, household formation & employment growth in South Auckland.

    “We will work with Auckland Council & infrastructure providers to secure a town centre zoning providing for commercial & retail uses integrated with high, medium & low density housing – all within walking distance of an integrated public transport node.”

    I’m sure someone can point to the integrated public transport node nearby.
    Or any other facility.

    And meanwhile, to support transport in the area, rather than National extend rail line electrification through Budget 2017, Auckland Council now has to buy unique trains with really large batteries to go from the nearest electrified line (Papakura) to Pukekohe.

    • lprent 3.1

      And meanwhile, to support transport in the area, rather than National extend rail line electrification through Budget 2017, Auckland Council now has to buy unique trains with really large batteries to go from the nearest electrified line (Papakura) to Pukekohe.

      That is a no-brainer. If the central government wants it, then it should damn well pay for it.

      Offhand, apart from a paltry number of houses – none as far as I can see affordable houses – that might get built, there is no reason for the drury development apart from enriching developers.

      It is too far out, there are other sites already attached to the existing transport networks that should be used, it appears to just be useless spawl, and by the sounds of it it is just some kind of Joyce wankfest.

      Ratepayers shouldn’t pay for anything involved in it and should instead charge at full ‘market’ rates for anything that involves city resources. All charges to be paid for before they get provided.

      • dukeofurl 3.1.1

        The ‘unique trains’ that have batteries are just the same trains we have now with batteries added and they can operate over the existing electrified network where the batteries will be recharged.


        • Molly

          Public transport options out this way are abysmal at the moment, and expensive.

          Quite a few commuters catching the train in the morning, including a lot of students both at secondary and tertiary level.

          • dukeofurl

            Thats because you are a long way out, around 20km from Papakura alone and 53 km by train to Britomart.

            Are you expecting to pay the same fare to the CBD as those from Glen Innes ?

            The tradeoff is cheaper housing as you go further out for higher transport costs

            • Molly

              No. I’m expecting the funds contributed by Franklin and Manukau residents in the past and at present, to result in a better public transport system that reduces or eliminates the need for private transport options. The fare system not only charges more, but delivers a less reliable timetable.

              I support public transport subsidies, because I don’t believe that we should continue our current planning methods that produce communities with the same problems in the outskirts just because they are on the periphery of Auckland. Not to mention avoid further spending on roading now and in the future.

              • dukeofurl

                So you do want to pay the same as Glen Innes. They are improving the service to allow for the future growth but I cant see you getting it cheaper

                • Molly

                  I never mentioned Glen Innes. That is your measure, not mine.

                  There is a failure in the lauded zone fares, where the fare gets charged if you tag off and on in a 30 minute period. If the bus is late and you miss your connection to the train, the hour wait between services mean that not only do you have a delay and longer travel time, you are charged for each stage separately.

                  The focus on inner city and north shore travelling is noticeable. With the large population in South Auckland that have been poorly served for years, it is due some consideration. And to respond that the benefit of good service is only to be delivered to central Auckland misses the fact that the planning of Auckland city has created satellite communities that also require suitable transport planning.

                  I am a supporter of lean, subsided fares not because I live on the outskirts of Auckland, but because I believe that the benefits of a larger community using public transport are social, environmental and financial in the long term.

        • Kevin

          They are not that unique.

          Bombardier and CAF (two off the top of my head) makes these units and are common in Europe.

          The UK is looking at using these now since the Tories got cold get on electric trains in Wales and other areas that were due to be expanded.

        • Keith

          They will cost between $40 and $70+ million over the cost of the number of equvilant normal electric multiple units and the batteries which are most of this extra cost will need disposing of and renewing in 7 to 8 years

          It is bat shit crazy but then with National in government it is the way councils have to think. Spend big in the short term to save some money on the day that will cost far more in the long term.

          It makes NO economic sense!

          • dukeofurl

            To get new trains to cover the existing service would only need 2 or 3, allow for growth and maintenance say 5 or 6. yet the proposal is for 17.
            Thats because they will spend most of their time the rest of the rail network adding capacity.

            What does 5 or 6 IPEMU cost ? say $25 mill

        • lprent

          The point is that it is an added expense on our commuter network. Batteries are frigging expensive and wear out with recharge cycles. Depending on the type they will either be horrendously expensive or merely expensive and requiring frequent replacement.

          This is explictly being done for central goverment project. They should pay the whole upfront and extra running costs directly.

          The ratepayers shouldn’t put a cent into these projects.

      • Molly 3.1.2

        Re: Drury. From a perspective of being involved with community planning, there seems to be a remainder of old boys network influence over planning decisions out this way.

        A good example of that is the decision to build the Karaka Sports Park (now in hiatus) effectively sucking up all the then available sports facilities budget by building a centre in the middle of rural land, which is then used to justify residential development alongside. There is a Karaka development lobby group that is influential in this area of Auckland, that continues to promote the Clendon – Karaka motorway bridge and has resulted in a large areas of residential housing.

        The recent granting of a non-notifiable resource consent to Craddocks (overturned by the Environment Court) allowed local residents to see the disregard for process that can take place by our own council staff. Unfortunately, redressing this takes a lot of money, time and causes considerable stress. Local planners told residents that there was nothing they could do, the resource consent was issued on the basis that the effects would be no more than minor – a 300,000 caged facility withing walking distance of a growing residential community. (To put this in context, the Poultry industry themselves submitted only a maximum number of 180,000 to the Unitary Plan.)

        I can understand how those who have experienced the process for many years return to the same players again and again, knowing that they will deliver. But the issues facing planners and communities at this time require change in thinking and solutions, and this kind of reliance on old networks does get in the way of considered planning.

    • dukeofurl 3.2

      Arent motorway interchanges a central government responsibility anyway, no matter the local streets that connect to them.
      Business gets a particular piece of roading infrastructure for free, while if a train station is added, they by crikey the ratepayers have to pay for that

      • Ad 3.2.1

        Same people paying.

      • lprent 3.2.2

        But if they get on to the motorways and commute elsewhere in the city, then they get off on to the cities roads again.

        There are two congestion problems in Auckland right now. One is on the NZTA network of state highways. The other is on the local main roads. Arguably the latter is far more of a problem because it tends to get far more congested with parking.

        Personally I am of the opinion that the key to solving both problems is to

        1. Remove all street parking on all main roads, effectively in most areas freeing up and extra two lanes.

        2. Make ALL parking chargeable. It carries a considerable cost to the city and effectively is a massive subsidy for cars. If people want cheaper parking then they need to provide it themselves, ie offstreet parking at home and work.

        The effects of the cheap costs of parking are pretty apparent through much of Auckland. Just trying to find a park in most areas even the most suburban is now massively difficult because damn near everyone over 18 has a car.

        That would remove the need for congestion charging because it’d increase the costs of operating a car and stop people who don’t use one having to pay for those who do.

        It’d also change the picture completely for public transport. Apart from anything else, it’d give NZTA a massive pause in their motorway construction and time to discover that they have a public transport obligation as well.

    • Kiwi Property Group Ltd has bought some of 51.3ha at Drury, with agreements to secure the balance, to create a new town centre next to Stevenson Group Ltd’s mostly industrial 360ha development site.

      The 3 greenfield sites are next to the junction of the Southern Motorway, Great South Rd and the North Island main trunk railway line, 35km south of Auckland’s city centre.

      Ah, they’ve been playing SimCity.

      Kiwi chief executive Chris Gudgeon said in a release today the company had acquired some of the land, and had secured agreements to acquire more, as a strategic long-term holding to capitalise on Auckland’s continuing population growth.

      They’re even admitting to the land-banking. This is why serious land rates need to apply.

  4. dukeofurl 4

    Auckland Transport board isnt mostly appointed by the Government- that was the case at the very beginning- but by the mayor and council
    Only one is appointed by NZTA or the Minister.

    • lprent 4.1

      Only by the Mayor apparently. I can’t see the old boards in a quick sweep. But looking at the current composition, I’d say that probably half have been there since 2010.

      There is currently NO council or public representation on its board at all. It appears to operate as a company with a board of directors with neither shareholders nor owners who have any particular say.


      It appears that the minutes of the board are spotty. The reports published from my brief glance through them are either redacted or confidential at the time to the point of providing little to no information within reasonable time frames to the public that owns it. In other words, it looks to me like the executive and/or the board make decisions and then usually tell everyone afterwards.

      From what I have seen about its decisions, it spends far too much time kowtowing to NZTA and the ministry of transport and insufficient time trying to solve Auckland’s rapidly escalating transport issues.

      In short, it’d be a disaster as a responsible private company for its lack of accountability and is a complete abortion in the public space.

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