Opinion: Government should be held to its 100,000 KiwiBuild promise

6:59 pm on 4 September 2019

By Dr Bryce Edwards*

Opinion - The KiwiBuild "reset" won't satisfy New Zealanders desperate to see housing made affordable. The changes announced today are an attempt to lower the public's expectations, and voters should insist on something better.

14 Burke Street, Wanaka.

Photo: RNZ / Tess Brunton

Many voters will be feeling "ripped off" after today's KiwiBuild reset.

It turns out it was more about resetting public expectations than getting the government's housing affordability project "back on track" and actually delivering.

The problem is, fixing the housing affordability was one of the promises that got this Labour-led government elected.

Back in 2017, people were angry that the previous government had allowed housing to become so unaffordable, and they were therefore willing to give the top jobs to politicians who were promising to fix this and other social problems.

Labour, in particular, won votes on their specific promise to build 100,000 affordable homes.

It's now officially a broken promise.

Housing Minister Megan Woods

Megan Woods Photo: RNZ / Ana Tovey

Housing Minister Megan Woods announced today that the promised 100,000 house figure will be scrapped, and no new target will replace it.

It's the kind of cynical "solution" that leads voters to lose faith in politics and have a low opinion of politicians.

In abandoning the promise of 100,000 affordable houses, it seems the minister wants us to believe that it was the existence of this target that was the problem, not the government's failure to deliver. So, she has gone with the option of cancelling the target rather than redoubling efforts to meet it.

Ms Woods now says that the government will simply deliver "more houses" as part of their programme. But voters shouldn't allow such a lack of accountability and should insist that the electoral contract be fulfilled. The media, too, should continue to tally the number of houses against the promise of 100,000.

A target has been put forward in terms of the "progressive homeownership" initiative: as part of the KiwiBuild reset, 4000 households could be brought into homeownership through a shared equity or rent-to-buy scheme. Of course, this number too needs to be contextualised. With 604,000 households currently renting, according to Stats NZ, it's a drop in the ocean. And we might expect more lottery-style gimmicks to help allocate those resources to the lucky few.

A lost opportunity like the CGT backdown

The overall problem that continues to plague this government's housing initiatives is a lack of ambition or boldness.

Unless 100,000 affordable houses are no longer needed for some reason, the government should have risen to the occasion and found a way to embark on a full-scale housing infrastructure project that actually meets society's needs.

That would have cost more money. But at the moment there's a developing consensus amongst economists about the need for this government to start spending much more on all sorts of social goods - housing, education, transport, health - in order to fix problems and stimulate the economy.

Not only are Treasury, the Reserve Bank, and much of the private sector open to much more spending, even National has been coming around on the need for greater infrastructure investment.

Housing could have been the recipient of that economic stimulus. It could have involved billions of dollars of investment, helping fix a huge accommodation problem. Instead, today's announcement is a lost opportunity.

Labour possibly thinks it's being smart in being so conservative on housing and in scaling back its ambitions. But there's a strategic danger for them in their caution. For many government supporters, today's "reset" will be seen as an embarrassing capitulation.

And much like the CGT backdown - the government's other key policy to deal with the housing crisis - it will shake the confidence of supporters who are wanting to see the transformational change promised. The Year of Delivery becomes an empty slogan for those depending on real change.

When it comes to next year's election, the governing parties might find their lack of courage leads to fewer of their supporters being mobilised to vote. And hopefully, on the election campaign hustings, politicians will be reminded of that broken promise of 100,000 affordable houses.

Having won power in 2017 on the basis of promises like KiwiBuild, it would be apt if the Labour-led government lost that power in 2020 because of their failure to deliver.

* Bryce Edwards is a Victoria University of Wellington academic whose main research areas are in political parties, elections and Parliament.

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