Bishop ChrisHon CHRIS BISHOP (Associate Minister of Finance): I'm just responding to the Minister of Finance's invitation to talk a little bit more about infrastructure and in doing so I want to touch on housing because the Opposition finance spokesperson at least for the moment was making much of the Government's plans around—or lack of plans in her mind—productivity. The simple reality is she's right in her diagnosis of the problem which is that we have a big productivity challenge in New Zealand. This is not something that can be wholly blamed on the previous Government. If we're honest about it it goes back many many years. And the Government is ambitious to address that.One of the things we must do is get much better at the way in which we deliver infrastructure in this country and that will be a key driver—Hon Shane Jones: Fast track.Hon CHRIS BISHOP: —of productivity. I am told—well I'll come to fast track. I am told that we do a very bad job as a country of turning our infrastructure delivery ambitions into reality. So for example we rank in the bottom 10 percent of high-income countries for the quality and efficiency of our infrastructure investments—bottom 10 percent. I've got to tell you on asset management it's even worse. On asset management governance and expertise we are dead last in the OECD. We're the bottom and we're the fourth last on asset management altogether. So we've got a big job to do as a country when it comes to asset management.This Government is going to outline a 30-year infrastructure national plan and we hope that that will achieve some degree of bipartisan consensus. That will be very important. We are going to use every tool in the toolbox available to us to drive better value for money from our Crown infrastructure spending. That means being open to private capital and that will be a bit challenging for the other side of the Parliament because under the last Labour Government there was just a hard no to private sector finance or even philanthropic capital for that matter when it came to things like hospitals and schools and roads and all the other things that the Crown has to procure and fund. Well we're very open to that. We're developing new tools around value capture around the reform of the Infrastructure Funding and Financing Act. We're open to public-private partnerships. So there's a whole lot of different tools on the table. It's going to take us a bit of time as a Government to build up the expertise inside the system to make that a reality but we're absolutely determined to do it.While I'm talking about productivity I do want to talk briefly about housing because the committee will be aware that we have a housing crisis in this country. We've seen over the last 20 years the fastest house price growth in the Western world. And you stand back and you say Well how can that be? We are only 5 million people. We have a land mass the size of the United Kingdom." Something has gone terribly wrong in our system where average house prices in New Zealand are seven eight nine 10 in the case of Queenstown 12 times average household incomes in Queenstown. And you say it does not have to be that way and that is of course true. One of the points that I am constantly reiterating around the country is that one of the single best ways we can get productivity going in this country is to fix our housing market because cities that grow and expand and are allowed to grow up and out are engines of prosperity. The evidence is really clear that the bigger a city is the more people you have living close to each other; connected by good quality high quality public transport; and able to get all of their agglomeration benefits of a bigger city—the evidence is really clear: that is a key driver of productivity. So that is the Government's ambition for our housing market—bigger and better cities. That involves a lot of complicated work around land supply both at the urban fringe of our cities to make sure that there's a safety valve at the fringe so that cities can keep growing out but also sensible density growing up as well. It involves fixing the infrastructure settings that mean that we have a housing crisis for example. And it also involves partnering with local government to make sure that councils are incentivised to go for housing growth. Because we are determined to change the political economy of our communities and our councils that sees at best ambivalence towards housing and at worst outright hostility from some councils around the country to the idea that our cities should grow. Well we're determined to change that.One way to do that is a big stick. We can use that. Another way is a bit of a carrot and we'll do the incentives as well. And we'll find our way through the middle. Probably both will be effective but we are determined to let our cities grow to address the productivity problems that the member opposite talks about."