Twyford’s big announcement

Written By: - Date published: 12:46 pm, November 24th, 2018 - 71 comments
Categories: Economy, housing, labour, phil twyford, Politics - Tags:

The government has just announced the creation of the most massive and powerful housing and land development agency that we have ever seen.

The Housing and Urban Development Authority will have cut-through powers to build quality state and affordable homes and create thriving master-planned communities.

The new authority will be responsible for leading the Government’s large-scale urban development projects and for being a world class state housing landlord. It will bring together three existing agencies that build homes – Housing New Zealand, its subsidiary HLC, and the KiwiBuild Unit.

Now, I had worried back in 2017 that the state’s actual capacity to roll out its housing programmes needed real musculature, and that it was lacking the strength to really achieve it.

It doesn’t get stronger than this one.

The Minister noted this morning:

The authority will transform the way New Zealanders live, work and play by building communities with a mix of public, affordable, and market housing, as well as the jobs, transport links, open spaces and facilities people need – it will do this at scale and pace so we can build our way out of the national housing crisis.

The authority will lead a range of large and small urban development projects throughout the country in partnership with local government, iwi and the private sector. For some large-scale complex development projects, it will have access to a range of statutory powers including:

• shortened planning and consenting processes;

• building and changing infrastructure;

• funding infrastructure and development;

• bringing together parcels of land; and

• reconfiguring reserves.

Over the coming months, we will continue to communicate the progress we’re making on our KiwiBuild and state home build programmes and further detail on how the urban development authority will operate.

It will take years of course before such an agency has the same confidence and rollout capacity as NZTA, the transport agency. The transport agency itself is growing in power and is likely to take on more and more of the arterial roads, and public transport, not just motorways. But that is what New Zealand society needs: transport should serve housing and communities, and it needs an agency with the strength to match that of transport.

This new spatial agency will be big enough to transform whole suburbs. There will not be too many local government agencies that will have the capacity to engage well with it – even Panuku does not appear to have much traction within Wellington, for example. But the Cannons Creek and Mt Roskill examples are signals of the ambition of this government to truly impact whole localities and to rebuild communities.

I would expect Housing New Zealand tenants may feel nervous. The Minister comments that:

There will be no change for Housing NZ tenants. Being a world-class public landlord will be a key priority for the new agency. It will have a strong social focus on the wellbeing of both its current and future tenants.

We believe public and affordable housing should be at the heart of our developments. This move puts public housing at the heart of our ambitious plan to build master-planned communities,” Phil Twyford said.

New legislation to establish the Housing and Urban Development Authority will be introduced to Parliament in 2019, with the first projects expected to be up and running in early 2020.

We should expect a fair bit of thrashing of the proposed legislation as it goes through its stages in the House. In particular: when you accrete a lot of power who regulates it on behalf of the defence of the citizen? Comparisons to Mortal Engine will I am sure be made:

(Same of course applies to transport. It is now clear to the Minister that NZTA itself doesn’t regulate well and on Friday afternoon has launched an investigation by MOT to regulate NZTA. Results out in late March.)

I can imagine that this is the kind of entity that would partner with NZTA to build much of Mangere through the light rail project. That’s got shades of the process by which rail was funded through the Hutt Valley a century or so ago: an entity that buys the land, subdivides and sells it, and uses the proceeds to build the rail one. Who knows what the actual instruments will be or how they will combine, but it’s clearly more powerful than any agency we’ve seen – stronger in its powers than even the development entities in Victoria.

Where this appears to be going is a strong aggregation of powers and assets across New Zealand to achieve housing targets that are bold and involve risk. The real estate agencies on record funding the National Party will choke on their zinfandel, but the Minister is generating powers to tilt housing real estate itself, and seems heading toward aggregating all of the state’s land assets in time into one umbrella.

So long as the citizen is defended, to me it feels an appropriate response to the scale of market failure and the distorted weighting towards massive motorway projects at the expense of communities, that has damaged our society for too long.

71 comments on “Twyford’s big announcement ”

  1. Ad 1

    “… on record funding the National aParty…”
    Correction.

    [Fixed – MS]

  2. ScottGN 2

    Interesting to see that Judith Collins’ didn’t come out and bag it first off, rather she used the announcement to try and promote her own ideas around so-called reform of the RMA Act.
    Maybe it’s finally filtering through to National that infrastructure (or lack thereof) is going to be big in elections to come.
    Daniel Andrews in Victoria has been campaigning on about Labor spending about 50 billion dollars worth of infrastructure In that state and even had the guts to say he would borrow for some of it. Polls have shown him stretching his lead over Guy as the campaign has gone on.

    • Collins is starting to practice what Shane Reti is doing in Whangarei. He picks up on whatever the coalition govt is doing well, and turns it into something he can agree on and will “then work hard to make sure it happens” : this is a trend he has started in his weekly columns in the local papers.

  3. Sacha 3

    “the process by which rail was funded through the Hutt Valley a century or so ago: an entity that buys the land, subdivides and sells it, and uses the proceeds to build the rail”

    The idea is to use big borrowing to build the transport and other infrastructure first, and retain ownership long enough to draw on the increased local property values from that to repay the loans.

    For this to work, mendacious dimwits like Madame Collins must be kept away from stopping that cycle from completing. We’ve seen how her type look at long-term funds like ACC or EQC as something to be stripped for short-term political gain.

    • patricia bremner 3.1

      Perhaps a portion of ASS’s money could legitimately be used in planning and providing safe and productive residential environments thus minimizing the cause of accidents.

      ‘Planning and building communities with green and open spaces with work homes and transport links’ (so less car accidents, a more harmonious society?)

      The ACC money could provide “Development and Infrastructure Bonds”, a superannuation product, which could assist with the enormous problem of work accommodation recreation and transport infrastructure.

      Perhaps that is Parker’s thinking. He has brought up using some of this huge fund for long term projects.

  4. Now do the same with NZ Post and Kiwibank. Both are state owned entities.

    • patricia bremner 4.1

      I agree peter peterson, and this would return assets to the commons in a modern frame.

      Especially important to control our money supply and communications.

      Imagine 4.5 billion more to work with. Huge.

  5. cleangreen 5

    Phil Twyford MP for Te Atatū must be gearing up to run for Mayor of Auckland as that is all we hear from him now is; – Auckland – Auckland – Auckland!!!!!!!

    Another typical jaffa as they all think nothing else is important to think about that goes on south of the Bombay hills.

    Sickening to us all.

    • Ad 5.1

      Have you checked out the Cannons Creek development near Wellington?

    • Draco T Bastard 5.2

      What a load of bollocks.

      Auckland has been subsidising the rest of NZ for decades now. Don’t you think that maybe it’s time we got some of it back?

      • Tricledrown 5.2.1

        Yep otherwise Auckland costs will be to high and productivity will decline affecting all of New Zealand.

    • OnceWasTim 5.3

      Don’t feel too dejected @CG. With Chippie’s PS reform (for some reason I keep thinking of him as ‘Skippie’) chugging away in the background, it won’t happen overnight, but it will happen as Rache used to say.
      Amongst various reforms, I was hoping for something like a Munstry of Transport, Communications and Infrastructure – this comes near enough to it.
      I was also hoping for the Munstry of Everything to be dismantled but instead the onion layers that comprise it are gradually being peeled away – even though they haven’t begun with the bleeding non-performing obvious.
      Chippie has publicly spoken about the various ‘non-joined-up’ services involved when having an ankle biter across agencies.

      Btw, I discovered this little gem the other day – Joyce and Coleman’s cabinet paper justifying their creation of that ‘Ministry for Everything’ and pointing out some ‘perceived’ conflicts of OBJECTIVES ffs (we now know what the objectives were of course):
      “If real or perceived conflicts of objective within the Ministry’s role (for example, social versus economic objectives; employer versus worker objectives; producer versus consumer interests) are not managed, there is a risk that the new Ministry will not be sustainable over time. This risk will be managed through organisational design and diligent management”
      How did that design and diligent management turn out do you reckon?.
      And all that sounds like the sort of neo-liberal shit-speak I’d have once had to write in a past life as a public servant post 1987.

      Good to see though the various layers of that stinky onion either being forcibly peeled off, or rotting away

    • patricia bremner 5.4

      Cleangreen, this may be a way for them to speed things up. Don’t give up just yet.

  6. Dennis Frank 6

    Think big, eh? I like it. I like the ambition, and the enterprise, the evocative stuff. Is it really a re-invention of socialism? If so, I’ll reserve judgment because it will probably need a tweak or three as it proceeds from design to implementation.

    A conceptual challenge for the Nats here. Given that they have supported state enterprise to some extent in the distant past, will they support this when it is established? Doing so can be framed as a pragmatic return to traditional nationalism. They could even call it national socialism. Contagious meme? May catch on… 😎

  7. Chris T 7

    This will end badly, like KiwiBuy

    • patricia bremner 7.1

      Kiwi build is just beginning.

    • Red Blooded One 7.2

      How’s that half-empty glass you’re drinking from? The tainted blue Kool-Aid not tasting so sweet?

      • patricia bremner 7.2.1

        “Blue Kool- Aid” feck that’s funny. Red Blooded One.

        Probably feeling the loss of money from their real estate and chinese supporters, it must be causing that ‘half empty glass’. LOL LOL.

        May be that’s why Simon is canvassing Winston’s goldcard group with his emails, asking for opinions and cash to fight the election in 2020..

        • Red Blooded One 7.2.1.1

          Hi patricia bremner, cheers. It just amazes me how relentlessly negative our friends here from the right are, this “won’t work, end badly, isn’t fair” wah wah wah. definitely glass half empty types. One can only wish them well and hope they find some positivity beyond their despair.

  8. “public and affordable housing”…its funny, thats two fairly small and distinct groups.

    To get onto ‘Public Housing’ waiting lists you need to be more than desperate for a house, you need to be incredibly lucky, its the equivalent of winning lotto. Meantime to buy an ‘Affordable’ house you need to be, well, lets just say, not struggling.

    So we will end up with very unusual communities really, taken from two quite different socio economic groups, significantly, both heading in opposite directions because no one is daring to suggest ‘Affordable’ housing could/should be anything other than a leg up into the Glorious Housing Market..

    But more importantly, it will exclude the majority of renters, young and old, who have no chance of a State House or a massive mortgage.

    It will, if nothing else, be an interesting social experiment, and I look forward to see the trickle down of actual affordable housing for the masses.

    I wonder how long it will be till ‘Affordable’ houses turn up on the rental market? Requiring rental subsidies no doubt.

  9. Phil 9

    Whilst I don’t want to see anyone homeless, this policy scares me. New Zealand already has the largest fraction of endangered species of any country on Earth.

    Unless this policy is accompanied by policies to stablise the population; to protect native ecosystem; and to increase and restore natural habitats close to urban centres; then things (such as the likelyhood of the collapse of our civilisation; and the extiction of our species) will ony continue to get worse.

    • DJ Ward 9.1

      Immigration used as economic stimulus, support for the finance sector, transpher of taxpayers money in subsidies to support landlords as shortages arise from immigration is a big (intellectually corrupt) mistake.

      It would be better to address the issues causing families to have only 1.8 children when we should be aiming for 2.0 to 2.1 births per woman. Immigration should be for genuine skill shortages, not the basis of artificial GDP growth, and wealth transfer from the taxpayer to the rich.

      • Tricledrown 9.1.1

        Your talking about the previous govts immigration policy.
        The cost of housing is the reason for lower birth rates families can’t afford a single income while paying high rents and mortgage.

        • DJ Ward 9.1.1.1

          Labour under Clarke used immigration as well.
          Yes high rents is a big factor as well as females delaying childbirth and males rejecting parenting.

          • lprent 9.1.1.1.1

            The primary reason for parents to delay or not have children through much of my working life if you are looking at people doing it from their own resources is:-

            A: because you can have an education, a career and buy housing and have kids late after paying down the student loans

            OR

            B: if you are lucky to both get trade skills and work very hard you can buy a house and have children while relatively young and continue to scratch
            OR

            C: you can be working poor with children and spend most of your income on rent.

            Every other combination requires that you have parents or relatives giving you or leaving you substantial money to get a deposit while helping with any training costs. This includes every aspirational story I have read so far from the Herald about property ‘hard work’ stories. They are basically fairy stories put out on behalf of their property advertisers.

            Personally when I look at the level of financial effort and tradeoff required for parents to have children, I can’t see any particularly good reasons to bother doing it. In my case (and that of my current partner) we could always sèe things to do that looked a whole lot more fufilling. Instead we became close support uncle and aunt.

            But a substantial number of both my generation and the ones immesiately following didn’t have kids was because of sky high interest rates and rents (80s-90s) followed by diminished incomes to housing costs (90s-00s).

            A lot of them only started having kids when Working For Families came in because it allowed them to balance paying for a mortgage or rent while one of the parents was off or on diminished work raising under 5yo kids.

            It has absolutely nothing to do with “..females delaying childbirth and males rejecting parenting.”

            It is largely simple economics without the pathetic moral compass you seem to be deluded on.

            • RedLogix 9.1.1.1.1.1

              It has absolutely nothing to do with “..females delaying childbirth and males rejecting parenting.”

              This is an observable phenomenon across much of the developed, especially the Western world. While the economic factors you outline play their part, it’s not at all clear they are the dominant factor as you imply. Indeed the wealthier a society is, the lower the birth-rate for reasons that seem to have little to do with income.

              My sense is that females are delaying childbirth, putting it off as long as their biological clock will permit, for two reasons; one because they have ‘better things to do” as you say and secondly because it maximises their opportunity to select the highest value mate they can attract. Males similarly have plenty of distractions, but increasingly see marriage and fatherhood as a role that has not much social respect and a high chance of ending badly for them.

              Another poorly understood factor is falling testosterone and male fertility levels across all developed nations. At current trends a significant fraction of Western males will be sterile sometime around mid-century.

              https://www.theguardian.com/science/2017/jul/29/infertility-crisis-sperm-counts-halved

              Even more intriguing is that young people seem to have simply lost interest in having sex in the first place:

              https://www.vice.com/en_au/article/qvqbmv/young-people-tell-us-why-theyre-having-less-sex

              Combine all of these negative factors together and the data is clear, we’re seeing marriage rates continue to fall across the West, and childbirth rates in Italy, Japan and a number of countries at well below replacement.

    • Ad 9.2

      It’s in urban areas.

      • Tricledrown 9.2.1

        It’s also the regions now because Auckland is so dear. People are moving to the regions.

    • A 9.3

      Yeah that was my reaction too.

    • patricia bremner 9.4

      Phil that is happening now, but better infrastructure will help keep our water clean. our energy sources environment to cause less carbon, not to mention providing transport links to take cars off the roads.

      Conservation areas built in and funded as necessary lungs, and wild life refuges along with Community gardens would be good for mental and physical health.
      We need to do this. The urban ad hock growth days are numbered worldwide. imo.

  10. Herodotus 10

    Not a mention of this ??
    “The HUDA will also have the power of forced acquisition, where private land owners can be can be forced to sell to make way for a development, though the minister says the powers are just “in the back pocket”.
    Whilst the govt can force a land owner to sell under the “Public Works Act”
    https://www.linz.govt.nz/crown-property/acquisition-and-disposal-land/land-involved-public-works/landowners-rights-when-crown
    “I don’t think it’s likely at all that someone’s private property or their house will be acquired for one of these projects, – Then why is this draconian clause included ??? If you cannot justify it openly then reading between the lines there must be a reason that this was included, a reason that Phil Twyford will not say.

    https://www.newshub.co.nz/home/shows/2018/11/phil-twyford-unveils-new-housing-and-urban-development-authority.html

    • Ad 10.1

      Await the legislation being introduced.

      PWA has its uses, including building a lot of public houses over decades already.

      Powers aren’t always used. AMETI properties were largely bought on the open market. As he says’ it’s “back pocket.”

      Similarly HLC Mt Roskill and Hobsonville used existing public land.

      • Anon 10.1.1

        So basically a threat, to force people into low-ball “private sales”.

        • Ad 10.1.1.1

          Not so far.

          Was no threat generating Hobsonville.

          Nor Te Atatu peninsula from Waitakere.

          Nor Cannons Creek.

          It’s time.

        • McFlock 10.1.1.2

          Not sure about “low-ball” offers.

          The flipside was ISTR with Dunedin Stadium there was a hold-out landowner who made a pretty penny after everything else had been bought.

          Not that you should be able to use PWA to build a stadium, but nevermind.

        • Gabby 10.1.1.3

          Or a threat, to discourage speculators from buying up ahead of development and holding the government to ransom nonny.

    • A 10.2

      Typical Labour. Swing the pendulum right over the edge of sanity.

      Its offensive to think there is any power whatsoever to do this – public works act bad enough and is the cause of much strife.

      • Ad 10.2.1

        You know it was National that brought in the Public Works Act in the first place?

        Do you recall the National Development Act?

        The strife is in falling home ownership and too little rental housing.

  11. Dean Reynolds 11

    Re NZTA, as well as public transport & motorways, NZTA now has railway development as part of its remit – joined up thinking!

    • Ad 11.1

      The next NLTP will see better integration of Kiwirail, so that NZTA can operate a “one system” approach.

  12. One Two 12

    ‘Being a World Class Public Landlord’

    What utter drivel!

  13. Graeme 13

    Well from a Queenstown perspective this is going to be rather interesting. A large site that was the High School has just been transferred to HNZ. https://www.odt.co.nz/regions/queenstown/school-site-now-set-state-housing

    There’s lots of brown fields (the Gorge Road abandoned / superseded industrial area) around it and reserve. All walking distance to CBD. Local providers in place http://www.qlcht.org.nz and Iwi appear interested and acutely aware of housing issues having multiple businesses in town.

    Interesting times.

    But the blowback from Realestate interests will be intense. Remember the dancing cossacks during the 1976 election, that was about the fear that Labour’s superannuation scheme was going to turn new Zealand into a communist state by buying out capitalism. https://en.wikipedia.org/wiki/Dancing_Cossacks_advertisement

    Yes, we knew Muldoon was deluded, there’s a slight logical flaw in that premise, but expect his philosophical children in the property game to be just as apoplectic with this policy.

    • Ad 13.1

      I agree the real estate companies who actively fund the National Party will no doubt be as creative again.

      But here’s a difference.

      On RNZ this morning Kim Campbell the head of the Employers and Manufacturers Association – not normally a hotbed of Labour support – gave his fulsome backing to the proposal.

      He said that it was well past time government had the power to clear away the planning rules that had evolved since the 1940s.

      Also the real estate developer community appear in part to be supportive. Standing side by side with Minister Twyford yesterday at a housing symposium in Henderson was the head of Ockham Developments.

      Also notable is that because National proposed a very similar UDA legislation in its last term, the attack lines in Parliament for next year are now very, very narrow. Hence Collin’s quite muted and oblique criticism.

      This Minister appears to have his ducks lined up.

      • Graeme 13.1.1

        Yeah, good work by the Minister, and his staff, for getting this together. A much needed capacity that should never have been removed in the first place, and should have been put in place before the demands of immigration came to bear.

        The ongoing challenge will be structuring the resulting developments so they don’t become an asset that can be sold off by future generations or governments, without replacement capacity being in place before sale.

        I felt the only reason National got dragged screaming and kicking to the UDA table was that they had run out of things to sell, so needed to create some ‘assets”, otherwise they were reduced to selling their seats, well Jamie’s seat…

      • The Chairman 13.1.2

        “Also the real estate developer community appear in part to be supportive.”

        With conservation land, council parks, scenic and historic reserves up for grabs coupled with broad powers, including the power of forced acquisition, the ability to ignore existing council designations, amend or write its own by-laws, override, add to or suspend provisions in the Resource Management Act and grant its own resource consent, of course property developers appear to be supportive. The removal of red tape is something they have long been pining for.

        However, what some see and define as the removal of red tape, others see it as the removal of safeguards.

        • Ad 13.1.2.1

          All reserves and conservation areas are subject to different acts. To sell those you would have to go through Reserves Act procedures even before you got to the Public Works Act procedures.

          As the Ruataniwha Dam case proved, even the state trying to divest a weeny bit for another public (local) good means you get your ass kicked all over the paddock in the Supreme Court.

          Different if you are living next to Remuera Golf Course though.
          That puppy can get carved up no problemo. Not a reserve.

        • mike 13.1.2.2

          i think you will find its things like golf courses ,avondale racing club single level houses down dominion road

  14. patricia bremner 14

    The trolls have to ‘chew this one over’ A stunning shift of power.

    The effect and strength of ‘joined up thinking’.

    This is a step change.

    Well done the Coalition.

  15. Timeforacupoftea 15

    Seen this all before !

    Just going back to the 1950’s.

    It was about bloody time these political clowns got on with the of housing the poor, the homeless, the injured etc.

    We still need to educate people to have one or two kids – not heaps of them while on welfare though.

    They need jobs, and this is starting to look better these days.

    Next up coming your way, minimum hourly rate of $25

    • patricia bremner 15.1

      This politician isn’t a clown. Twyford is gaining credibility.

      Great Post Topic this.

  16. Craig H 16

    In the title: Announcement, not ‘anouncement’.

    [Oops thanks. Now corrected – MS]

  17. Antoine 17

    We shall see how it goes

    A.

    • Antoine 17.1

      Readers should consider this. The combination of several different agencies (with different objectives) into a single super-agency is not, in and of itself, a cause for celebration. If you didn’t cheer the creation of the Auckland Super City, MBIE or MPI, then you shouldn’t cheer this.

      In saying that, it may do well and I hope it does.

      A.

  18. Antoine 18

    (Why can’t everyone get some of those ‘shortened planning and consenting processes’?)

    A.

    • Ad 18.1

      95% of consents sail through fine.

      Really big private ones get both extra scrutiny and extra Council resource applied, as you would expect given their effects.

      But these developments will be signed off by Cabinet before proceeding. That means they are government policy. They are getting special powers because they are executing government policy to deliver faster and better than the market can deliver or than Councils can regulate.

      That reflects the government view of the scale of market and regulatory failure in this policy area, hence the scale of market and regulatory correction required.

      • Antoine 18.1.1

        I am having trouble reconciling your statement that “95% of consents sail through fine” with your conclusion that there is large scale regulatory failure.

        Seems like a desire to ‘have your cake (allow the Govt to bypass regulation) and eat it too (continue to subject the private sector to the same regulation)’.

        In short, if there is regulatory failure, then developers other than the Govt should not remain subject to the failed regulation.

        A.

        • mickysavage 18.1.1.1

          95% of consents sail through fine means that consent is granted without any difficulty. This does not mean that the system is working for the benefit of us, only that it is working as designed.

          Blame the last government for “streamlining and simplifying” the system so that public oversight of consents was muted.

          • Antoine 18.1.1.1.1

            But this is even more confusing.

            You are saying that it is too easy to get consents. So, the Government is awarding itself more powers, to make it… even easier to get consents?

            A.

            • Sacha 18.1.1.1.1.1

              In exchange for allowing govt’s new dedicated development agency to oversee planning of bigger developments, council and private partners get faster signoff.

              This will not affect smaller developments which will remain with Council as the oversight agency.

              • Antoine

                Thanks, I understand better how the process will work now.

                My original question remains – why not extend the same benefit to all parties seeking consent.

                A.

  19. Mr Marshy 19

    Another day, another pipe dream from the man who knows about everything, Twitford. Wonder if he has costed it better than Kiwifail?

    • Sacha 19.1

      You ought to take prose that sparkling to kiwibog right away. Excelsior!

      • Antoine 19.1.1

        There is a point hidden in the marsh however, which is that rolling several agencies together into one super-agency has often been found to increase the total cost rather than reducing it (via increased economy of scale) as one would hope.

        A.

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  • State of the Nation
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