2. Housing—Brightline Test and Advice on Government PoliciesHon MICHAEL WOODHOUSE (National) to the Minister of FinanceHousing—Brightline Test and Advice on Government Policies2. Hon MICHAEL WOODHOUSE (National) to the Minister of Finance: Does he have confidence in the policy advice he receives?Hon Dr DAVID CLARK (Acting Minister of Finance): I do have confidence in the advice provided by officials although it will not surprise the member that I do not always agree with that advice.Hon Michael Woodhouse: Does he stand by his answer to a supplementary question to question 3 yesterday when he said The irony of that member raising it—because it's the same advice that was provided to that party opposite when they introduced the two-year brightline test."? Hon Dr DAVID CLARK: Extension of the previous Government's brightline test was an election commitment and was not the result of policy advice since the Government was formed. I would note that Treasury did provide advice that the longer the period that the brightline test applies the easier it will be for the Inland Revenue Department to collect revenue from property speculators. The longer the brightline test also means that it is easier for taxpayers to know whether a particular residential property sale is taxable. I would finally also note and to the member's point that in 2010 Treasury provided advice on a brightline test for residential property with a minimum of a five-year period as a base-broadening option for Budget 2010.Hon Michael Woodhouse: I raise a point of order Mr Speaker. A fascinating answer but it didn't address the question. My question was simply this: did he stand by his answer to yesterday's question?SPEAKER: I certainly got that impression from the answer.Hon Michael Woodhouse: Was he aware that that advice expressly stated a three- to five-year brightline option had the greatest risk of capturing sales that were acquired without an intention of resale and was emphatically not officials' preferred option; and if so isn't that the greater irony?Hon Dr DAVID CLARK: Treasury provided advice suggesting that a minimum of a five-year period was the best response.Hon Michael Woodhouse: Is he concerned that all the advice provided to him from officials—SPEAKER: Order! Can I ask Ms Genter and Mr Bishop to stop their private conversation and let Mr Woodhouse ask the question.Hon Michael Woodhouse: Is he concerned that all the advice provided to him from officials indicates that KiwiBuild may simply substitute the effort from the existing construction pipeline at high fiscal cost to the Crown but only of marginal benefit to housing supply?Hon Dr DAVID CLARK: We have outlined a policy to cope with the constraints on ramping up home building that we inherited from the previous Government. I'm confident that we can deliver on our promises. As to when the capital will be drawn down when and how it's going to be drawn down I'd refer the member to the Minister of Housing and Urban Development if he wants that detail.Hon Michael Woodhouse: Why have both Treasury and the Inland Revenue Department advised the Government that policies such as the five-year brightline test the healthy homes legislation and proposed negative gearing will make life more expensive for renters at the very time when house prices particularly in Auckland are stable or declining?Hon Dr DAVID CLARK: I don't think the member characterised that advice correctly but I'll state again that I do have confidence that officials strive to provide the best policy advice they can given constraints such as time and the quality of data available and that policy advice can evolve over time as new and better information comes to light. However I will not necessarily always agree with that advice.Hon Michael Woodhouse: Is he concerned about the negative advice piling up against the Government's policies: the Inland Revenue Department saying a five-year brightline test is too long; the Reserve Bank saying KiwiBuild will add only a quarter of the houses promised; residential construction slowing; and Government policies leading to higher rents—or does he know better than his officials?Hon Dr DAVID CLARK: I disagree fundamentally with the member's characterisation of the advice we're receiving."