BUDGET 2013: Government to over-rule councils on housing

New legislation announced in today’s Budget will allow the government to over-ride councils and issue its own consents for housing developments.

The legislation extends a recent housing accord announced for Auckland and will enable fast-tracking of housing projects in areas with serious housing affordability issues.

“Council decisions can affect the entire economy by increasing house prices, driving up rents, and putting increased pressure on family budgets,” Housing Minister Nick Smith says.

“Housing supply constraints are causing widespread concern about financial stability, with potentially negative impacts on interest rates and the exchange rate.

“The government’s first preference is to partner with councils to improve housing affordability.”

The legislation will apply for three years and allows special housing areas to be designated under accords between the government and councils.

“The developments need to be predominantly residential, in greenfields or brownfields areas adequately supported by infrastructure, limited to low-rise construction, and in areas of high housing demand,” Dr Smith says.

“If an accord cannot be reached in an area of severe housing unaffordability, the government can intervene by establishing special housing areas and issuing consents for developments.”

Budget 2013 includes $7.2 million over four years to help the Ministry of Business, Innovation and Employment fund the initiative.

The legislation will go through its first reading as part of Budget 2013 before being sent to a select committee for a shortened six-week timetable for urgent consideration and progress.

Pleasantly surprised

Property Council chief executive Connal Townsend says he is pleasantly surprised by the government’s announcement on housing.

“This is a government that’s determined to tackle housing affordability head-on.”

New Zealand Initiative research fellow Luke Malpass also welcomes the policy, saying it will provide more certainty for developers.

“You’ll know it’s going in and going to come out after six months with no appeals and you know if you can go for it or you can’t.”

However, Auckland mayor Len Brown says there are clauses in the bill that appear to be inconsistent with the Auckland Housing Accord.

“My expectation is that the Select Committee process will provide an opportunity to clear up these inconsistencies.

“Clearly, in relation to the accord, the point of the legislation is to give effect to the agreements we reached.

“The accord still needs to be considered and agreed by the Auckland Council’s governing body. Before we can do this we need to be certain that the legislation is consistent with the agreements in the accord.”

Mr Brown says he will be writing to Dr Smith to raise questions about the consistency of the accord and the current bill.
 
The streamlined consenting process outlined in the accord can only take effect once the council’s draft unitary plan is adopted for notification – expected to be September this year.

nkloeten@nbr.co.nz