Norman Russel: Questions for Oral Answer — Questions to Ministers 
Text is incorporated into the Bound Volume 
Norman Russel: Questions for Oral Answer — Questions to Ministers 
[Sitting date: 18 July 2012. Volume:681;Page:3617. Text is incorporated into the Bound Volume.] 
1. 
Dr RUSSEL NORMAN (Co-Leader—Green) 
 to the  
Prime Minister 
: Does he stand by his statement of 19 March this year that the housing market is “going to take off”? 
Rt Hon JOHN KEY (Prime Minister) 
: 
 Yes in the context in which it was made. The housing market had been pretty flat for some time and I was expressing my opinion that things would pick up. In fact we are already starting to see that. Quotable Value reports that sales activity has been significantly higher in the last few months than had been the case for several years especially in Auckland. For the member’s benefit I was not talking about a housing boom of the sort of price bubble that we saw in the mid-2000s though. 
Dr Russel Norman 
: Given that we have a situation where house prices are rising at four times the rate of inflation and twice as fast as wages according to official data are we facing a situation of market failure that is seeing homeownership become impossible for more and more Kiwi families? 
Rt Hon JOHN KEY 
: No. I mean one thing I think we can rejoice in is that interest rates are at a 50-year low and that is one of the big factors that assist people in terms of their homeownership. But there are recommendations from the Productivity Commission in relation to its most recent report on housing that I think would be worthy of Government attention. 
Dr Russel Norman 
: Is it not the case that house prices are out of reach for typical New Zealand families on typical New Zealand wages and that this is a major factor that is driving people overseas and forcing a generation of New Zealanders to watch their grandchildren grow up on Skype? 
Rt Hon JOHN KEY 
: No and if the member wants to visit Sydney or Melbourne he will come to realise that house prices are significantly cheaper in most parts of New Zealand than in Australia. 
Dr Russel Norman 
: Why is the Government not taking measures to increase the supply of new affordable well-insulated housing—[ 
Interruption 
] 
Mr SPEAKER 
: Order! I want to hear the member’s question. The member may start again. 
Dr Russel Norman 
: Why is the Government not taking measures to increase the supply of new affordable well-insulated housing to address the market failure to provide enough housing that ordinary Kiwi families can afford to buy? 
Rt Hon JOHN KEY 
: There is absolutely no market failure when it comes to insulating housing and I am surprised the member raised that because we happened to work together as political parties to see more homes insulated in the last 3 or 4 years of a National-led Government than had been seen for decades virtually I would suggest under previous Governments. In terms of making houses more affordable and attainable to New Zealanders one way not to do that would be to put a capital gains tax on them as the member wants to do. But if the member wants to support us in reform of the Resource Management Act so that we can— 
Mr SPEAKER 
: Order! I think the Prime Minister has gone on sufficiently there. 
Dr Russel Norman 
: Did the Prime Minister hear the remarks from Fran O’Sullivan at the Local Government New Zealand conference where Ms O’Sullivan particularly referred to the market failure around housing supply being a major intergenerational issue whereby older New Zealanders have seen their house prices go up very considerably but a younger generation of New Zealanders are struggling to be able to afford to buy their first home? 
Rt Hon JOHN KEY 
: I think if you went and spoke to any generation of New Zealanders they would say that it is always quite difficult to purchase one’s first home. That is the case for most New Zealanders. They struggle and they save. But fortunately this generation of New Zealanders has the economic leadership of a National Government that is ensuring that interest rates are at their lows that there has been reform of the Resource Management Act and that there is Maurice Williamson’s great work around licensed building practitioners etc. etc.—all making the Kiwi dream of buying a home possible. [ 
Interruption 
]  
Mr SPEAKER 
: Order! I say to the Labour front benches I want to hear Dr Russel Norman. 
Dr Russel Norman 
: Does the Prime Minister honestly believe that housing affordability has not changed over the last 10 to 15 years and that it is not much harder for younger New Zealand families to get on to the housing ownership ladder than it was 10 to 15 years ago? The Government has a responsibility to address that problem. 
Rt Hon JOHN KEY 
: No I think it got a lot worse under Labour. That is because it just did not know how to do anything else other than spend taxpayers’ money force up inflation and drive up interest rates. It failed to respond by adjusting the bits of the economy that would make housing more affordable outside of interest rates like the Resource Management Act. And that member every time this Government wants to reform the Resource Management Act and make it— 
Hon Trevor Mallard 
: Who passed the RMA? 
Rt Hon JOHN KEY 
: You passed it and it was a complete and utter mess Trevor. 
Dr Russel Norman 
: When will the Prime Minister stop blaming the last Government and accept that we have a housing affordability crisis right now in this country that young people are struggling to buy their first house and are leaving the country to get better opportunities somewhere else and that his Government has a responsibility to do something about it rather than just blame the Labour Party? 
Rt Hon JOHN KEY 
: If that member really thinks we have a housing bubble at the moment in the way that we had one under the previous Labour Government then firstly he is deluded and secondly he might want to ask the then Labour Government why it bothered to commission a whole report on housing affordability of which it followed very little. 
Rt Hon Winston Peters 
: Can the Prime Minister tell us which party brought in the Resource Management Act about which he is always complaining? 
Rt Hon JOHN KEY 
: Well we brought in the legislation drafted by the previous Labour Government. [ 
Interruption 
] 
Mr SPEAKER 
: Order! Members will be silent. I do not want anyone to have an early shower today.