2. Housing Supply—Productivity Commission Report and Government Initiatives to AddressANDREW BAYLY (National—Hunua) to the Minister of FinanceHousing Supply—Productivity Commission Report and Government Initiatives to Address2. ANDREW BAYLY (National—Hunua) to the Minister of Finance: What Productivity Commission reports has he received on New Zealand's urban planning system?Hon BILL ENGLISH (Minister of Finance): Last week the Productivity Commission released its draft report Better urban planning in response to the Government's request for a first-principles analysis of land use allocation because land use is critical to the health and success of the New Zealand economy. The commission finds that planning can contribute positively; however planning legislation lacks clarity and focus there has been planning overreach in urban areas and the planning system is not responsive to changes in cities. Infrastructure funding tools do not recover costs or account for the risk placed on councils. The Productivity Commission also suggested that central government and local government should make more effort to understand the issues each other is dealing with. David Seymour: Is the Minister concerned or does he share the concerns of the report for example that the level of complexity in land use planning laws is increasing—for example the Resource Management Act (RMA) was 382 pages when introduced in 1991 790 pages in the 2011 revision and 827 pages in a 2013 revision—and does the Government have any plans to introduce RMA reforms that might reduce the length of the Act?Mr SPEAKER: Before I call the Minister can I just remind the member that he raised a point of order last week about questions being in line with the Standing Orders particularly Standing Order 380. I would be grateful if he could assist me as well. Hon BILL ENGLISH: We believe that the RMA amendment that has been proposed in this House will achieve some of those things but I do agree with his general point that the complexity of planning has increased. The Auckland Unitary Plan—where the general thrust of it is correct I think—is around 7000 pages and it is possible that our councillors are getting a bit too involved at very low levels of detail not just in how our cities develop but in how our own houses and households operate.Andrew Bayly: What does the commission say are some of the consequences of excessive planning?Hon BILL ENGLISH: The commission takes a fairly even-handed view of the function of planning itself saying that it is important in achieving some aspects of the development of our cities. However it does say that housing is unaffordable where land is unaffordable. The report highlights an eightfold increase in the price of land in Auckland between 1996 and 2014. In 1996 a hectare of land in Auckland was valued at around a million dollars; today it is valued at around $8 million. Research has previously associated that increase with Auckland's urban limits.Andrew Bayly: What steps is the Government already taking as part of its comprehensive housing plan that were recommended by the Productivity Commission in its most recent report?Hon BILL ENGLISH: A lot of steps because actually the very first report of the Productivity Commission back in 2012 was on the regulation of land use and the Government took some advice from that. The commission says that notification and appeals should be limited to those more directly affected by development—that is part of the current RMA amendments. It says that planning should prioritise responding to growth and providing land use flexibility—that is the goal of the current RMA reforms and the national policy statement. The commission says the Government should be able to override local plans in limited circumstances where there are wider effects on the rest of the country—that is also part of the current amendments.David Seymour: Which of those steps does the Minister think will be first to have an effect?Hon BILL ENGLISH: They will all have an effect at the same time when the RMA bill is passed. In the meantime though the prospects for improvement are pretty positive because the Auckland Council has passed the Auckland Unitary Plan which now enables twice as much housing supply as the original plans did and that is good news particularly for low and middle income households that want to in the long run own houses in Auckland.David Seymour: Did the Minister intend to imply that none of the steps in the Government's comprehensive housing plan have had an effect yet and will not have an effect until the RMA reform is passed?Hon BILL ENGLISH: No because a whole lot of other steps are in place ranging from demand-side measures implemented under the macro-prudential policy through to the special housing areas and the cranking up of the Government's production of new houses on its own estate particularly in Auckland.Andrew Bayly: What steps is the Government taking to get more social and emergency housing where it is needed most as part of the Government's comprehensive housing plan?Hon BILL ENGLISH: It is a bit of a challenge because 50 years of poor social housing policy has meant that about a third of Housing New Zealand's portfolio is in the wrong place or is the wrong type. The Government is making significant change to the social housing system at the same time that prices have been rising fast and that does make the changes challenging. Sales to social housing tenants and where appropriate to first-home buyers have generated revenue that has been reinvested. Housing New Zealand is planning to build around 2000 houses over the next 2 years on top of the 7500 houses that are expected to be delivered by the Tāmaki Redevelopment Company and community providers around the country.