Twyford Phil: Questions for Oral Answer — Questions to MinistersText is incorporated into the Bound VolumeTwyford Phil: Questions for Oral Answer — Questions to Ministers[Sitting date: 24 October 2013. Volume:694;Page:14268. Text is incorporated into the Bound Volume.]4.PHIL TWYFORD (Labour—TeAtatū) to theMinister of Finance: What reports if any has the Reserve Bank had from trading banks on the effect of loan-to-value ratio lending limits on housing construction?Hon STEVEN JOYCE (Associate Minister of Finance) on behalf of theMinister of Finance: The Reserve Bank advises that it has not received reports from trading banks on the effect of loan-to-value ratio restrictions on housing construction. I would not expect to see such reports given the Reserve Bank’s independence on macro-prudential policy.Phil Twyford: What impact does he expect loan-to-value ratios to have on the Government’s housing policy which claims to be focused on trying to increase supply if as Warwick Quinn of the Registered Master Builders Federation predicts they result in 3000 fewer new homes being built each year?Hon STEVEN JOYCE: That is a difficult statement to reconcile with a statement made by the Registered Master Builders Federation to the Minister’s colleague the Minister for Tertiary Education Skills and Employment at around the same time when it said it was worried there would not be enough apprentices and enough people with skills to actually build all the houses. So I think we need to rationalise where we are at here: either there are not enough people around to build all the houses or there are not enough houses going to be built. I am sure we will resolve that situation.Phil Twyford: Can he explain why the Prime Minister said “I can’t for the life of me see how it will affect home building.” at the same time as the Reserve Bank is currently researching the impact on new builds of loan-to-value ratios or should we give this statement the same credibility as the Prime Minister’s earlier promise to protect first-home buyers from the effects of loan-to-value ratios?Hon STEVEN JOYCE: If housing prices are rising that generally leads to increased supply over time. The issue is whether that supply is happening fast enough. Given that prices have been rising it is entirely reasonable to say that more construction will occur. If the member is saying that will not happen then he really does need to go back to Economics 101 and have a chat to the economics lecturers at the time.Phil Twyford: Is he concerned that Treasury rubbished the Government’s changes to KiwiSaver and the Welcome Home Loan scheme saying they were questionable spending and would undermine housing affordability and will he now concede the changes were a desperate attempt to distract attention from the damage that his housing policy is doing to first-home buyers?Hon STEVEN JOYCE: No and it is interesting to note that the member himself said the policies were not big enough. So on the one hand he is citing Treasury criticism and on the other hand he is saying we should do more which actually is not inconsistent with his previous statements which have been both in favour and against loan-to-value ratios. The answer to this problem is to have a larger supply of housing. That is why the Minister has done the special housing areas and announced 6000 more houses to be built in Auckland which of course the Opposition opposes.Phil Twyford: Will he admit that the Government’s housing policy is in tatters with Treasury criticising recent policy announcements as ineffective and questionable and recommending that the Government consider policies like a capital gains tax and excluding offshore speculators—policies that he refuses to consider?Hon STEVEN JOYCE: The member might want to read Treasury’s recommendations on capital gains taxes because Treasury is keen to have it on all houses. The trouble with having it on all houses of course is that that affects everybody’s family home. But that is what Treasury is seeking. If the member wants to line up with that policy I would welcome his announcement in that regard and I think everybody on this side of the House would.Phil Twyford: Everybody else is wrong!Hon STEVEN JOYCE: But in terms of capital gains taxes Mr Twyford the situation in Australia is that they already have one like the Labour Party policy and their prices are going up even faster.