Parker DavidHon DAVID PARKER (Labour): I rise to speak in support of the proposed amendment in my name that adds new Part 6 to this bill. Can I make the point that this prolonged debate of all of these other necessary measures that would be important to solve the housing crisis—every one of which National is voting against—is being protracted only because the Government under urgency pushed through Part 2 of this bill which takes away without select committee consideration the property rights of people who have a residual interest in a property that was compulsorily acquired by the Crown. The Government having said that that is already the law is passing a law to take it away—obviously it is hard to believe that that is already the law if that is what it is doing. If it had not been for that the Government could be progressing with other business. If it wants to still refer that to select committee and put that through a decent process its members should come and talk to us.This part of the bill is a very important part of the Labour Party's policies to reduce the cost of new housing which as my colleague Phil Twyford points out flows through to the cost of all other housing. As we know markets clear at the marginal cost of the new. If there is a shortage if the marginal cost of the new is higher than it would otherwise be it not only lifts the cost of the new but flows through to all of the alternative purchases which are the cost of the old. So if you have excessive land costs and excessive capital infrastructure costs up front in a new subdivision then that flows to the cost of all housing in a place where you have got urban population growth—as we have in Auckland.Perhaps the thought leader on this in the world or one of them is Professor Ed Glaeser from Harvard University. He was brought out by the University of Auckland business school a couple of years ago to address New Zealand on what you need to do to have good cities that service the needs of the population particularly in growing cities. He is the author of a book called Triumph of the City. I went to his lecture in Auckland and he made three important points. Before I turn to that I would make the point that it is absurd that in a country that has as much land as New Zealand—and as few people—that we have amongst the most expensive land or land inflation in the world. It is a truism. We have got a land area that is the size of the United Kingdom about the size of Italy. We have got less than a tenth of their population and yet we are the ones that have got problems with house prices and land inflation. It is not because we are short of land; it is because the Government's settings are wrong including around the planning of the release of land. You hear defenders of urban growth limits say: Well there's a lot of land planned for release." In fact Auckland City in its own defence says that it is rezoning an area the size of Hamilton and therefore all of these problems will be cured. The problem is that actually it releases that extra land zoned in tiny little increments so as to drive from its point of view the efficient use of infrastructure. In the process those releases are always captured by land bankers because land bankers know where they are going next—the 10-year long-term council plan shows where the infrastructure is going in next. So around the margins of that growth the price of land is held high because the market is never fully supplied with land in the face of the shortage that we have had for some years.So Glaeser says two things—well actually he says three things that I think are really important in this debate. First of all he says that urban growth boundaries are inappropriate because they constrain supply in the face of population growth and drive up prices. Secondly he says that rules that limit the natural intensification that will occur within an existing city are even worse because they drive up prices and they stop people from doing what they naturally want to do—which is that as populations grow they actually want to live in reasonably compact cities. Thirdly he says that you have to be very very very careful that you do not transfer the cost of infrastructure inappropriately either to existing ratepayers as a future ratepayer to them or—also one of the other reasons you do not want to do that is that you distort the price signals across the whole of your country and you actually ruin the regional development of other places which should be gaining an advantage. If prices are on the rise in a city like Auckland you would expect that other cities and other regions would be developed as a substitute for some of that more expensive development in Auckland. You do not get that right if you do not get the pricing of infrastructure right.What this requires is that a national policy statement be drafted by the Minister for the Environment under the Resource Management Act (RMA) within 6 months of the proposed new section 46C coming into effect. That national policy statement would then go through the normal processes under the RMA and would effectively impose rules upon district and regional councils that stop these practices that at the moment are driving up land prices and therefore house prices.The Labour Party has been pointing out that this is necessary for about 3 years. Our response has become increasingly sophisticated in the last couple of years through Phil Twyford's efforts and other people's—and I hope I have made a contribution there. But it actually goes back to when Annette King was our housing spokesperson and David Shearer was our leader when we first said that we actually needed a national policy statement in respect of affordable housing under the RMA. As my colleague Phil Twyford has pointed out for years we have had National bleating on that the RMA is the cause of these problems. Actually in truth if used properly the RMA is the solution to these problems because national policy statements are provided for under the RMA and should be used when there is an issue of national importance—such as a housing shortage—that needs to be overcome through changes to planning rules which the Government has always had the ability to do through a national policy statement under the RMA.I want to deal with the point that Julie Anne Genter raised because it is a very important point. She makes the point that you have got to be careful that you do not drive inappropriate forms of urban form that increase pollution waste infrastructure cause people to sit in cars longer increase the cost of public transport because you have got to extend public transport networks or increase the operating costs of public transport because they are less efficiently used. That is the purpose of these paragraphs (c) (d) and (e) of proposed new section 46C(2) of the RMA under this amendment.It says that central government should list all of the infrastructure costs—that includes libraries and swimming pools the extensions to public transport the extensions to local roads and the inefficient use of central government motorways—all of these things should be properly measured. You will not recover the cost of all of them but you should be properly measuring the marginal cost of growth so that you can make a rational decision. Then you should have some standard rules that work across the country as to how you allocate those costs. That is how you get the right economic signal to drive appropriate urban form without allowing the land bankers to capture the land market and drive land prices to the ridiculous levels that we have in New Zealand where despite being a country that is so rich in terms of our land area we have this incredibly high land inflation.The Labour Party was on to this before National. We were on to it before the Productivity Commission started to think of it. We are in many ways more considered in our use of markets than is the Government. The Government claims that it knows how to work markets. These are rules-based markets. The rules are in district plans. If the market is not working you need to change the rules. It is that simple. But the National Government does not understand that in order to use and harness the private sector and the public sector to solve this housing crisis that we have in New Zealand we have to harness those markets through appropriate rules relating to the urban limit. That is what this tabled amendment in my name does. We have artificial land scarcity in New Zealand. We all know that we have got a lot of land; it is just that people are not allowed to build on it. Blaming the RMA has always been wrong; the RMA is where the solution lies."