6. Question No. 6—FinanceANDREW BAYLY (National—Port Waikato) to the Minister of FinanceQuestion No. 6—Finance6. ANDREW BAYLY (National—Port Waikato) to the Minister of Finance: What specific measures if any has the Minister taken since January 2020 to respond to warnings from the Reserve Bank that unconventional monetary policy could lead to house price inflation?Hon GRANT ROBERTSON (Minister of Finance): At the time of the January 2020 report the member is basing his question on the Reserve Bank's position was that there was not a case for using unconventional monetary policy in New Zealand in the near future. So the premise of the member's question is actually based on a hypothetical scenario. Obviously COVID-19 changed that. The global pandemic created the largest economic shock in a hundred years and the Reserve Bank of New Zealand followed other central banks around the world by rolling out a series of measures to support the economy including unconventional monetary policy. They also changed their views on what that would mean for house prices. In any event the Government has continued to take a number of specific measures to address the housing market. These include the largest public house building programme since the 1970s increasing investment in infrastructure to allow for greater housing supply starting work on reforming the Resource Management Act (RMA) releasing the National Policy Statement on Urban Development and continuing to work with the Reserve Bank on the interactions between monetary policy and financial policy.Andrew Bayly: Why has the Minister still not formally responded to the Reserve Bank's letter of 9 December 2020 on measures to amend monetary policy such as capital adequacy ratios or debt-to-income restrictions?Hon GRANT ROBERTSON: We are taking our time to respond to the very serious issues that have been raised in the debate about the housing market. It is important that we get these right—they are significant decisions. Cabinet is working its way through them and we'll be making announcements shortly.Andrew Bayly: Does the Minister agree with the Reserve Bank Governor that measures to increase supply such as increasing land availability or removing regulatory barriers are the significant determinant in reducing house price inflation?Hon GRANT ROBERTSON: I agree with the fact that supply issues are important as demand issues are important. It's one of the reasons why we're undertaking a programme to reform the RMA. It's the reason why we released the National Policy Statement on Urban Development and it's the reason why we understand that this is not a situation where there is a silver bullet; it will require sustained action across demand and supply and that is what we'll do.Andrew Bayly: Why has he taken over a year since he first received the warning from the Reserve Bank to address house price inflation during which time first-home buyers in New Zealand have seen the median house price increase by approximately $121000?Hon GRANT ROBERTSON: Between January 2020 and now an event occurred—it was COVID-19—and in May the Reserve Bank itself forecast that house prices would fall by 9 percent. That was the consensus of economists. It didn't turn out; the opposite has happened. The Government is moving to address that now.Andrew Bayly: Does he believe that it's fair for first-home buyers who've seen the median house price increase by about $11000 per month and who are now seeing their dream of homeownership out of their reach?Hon GRANT ROBERTSON: What I don't think is fair is a Government that had nine years to actually get on with building affordable homes with actually supporting New Zealanders into homeownership and failed to do it.