31 Jan 2013

Green Party accuses Reserve Bank of sacrificing jobs

6:25 am on 31 January 2013

The Green Party has accused the Reserve Bank of sacrificing jobs by not introducing new tools to control house price inflation.

A paper obtained by the party shows the Reserve Bank believes introducing loan to value ratios would have a positive effect on the housing market and the economy.

Loan to value ratios effectively clamp down on how much banks can lend.

Green Party co-leader Russel Norman says the bank has been sitting on the paper since last May.

Dr Norman says suppressing the housing sector would allow the Reserve Bank to cut interest rates and take pressure off the value of the dollar.

He says other central banks are following such policies, but New Zealand has one of the most rightwing central banks in the world which is prepared to sacrifice jobs in the pursuit of a neo-liberal purist ideology.