Robertson Grant: Oral Questions — Questions to MinistersText is incorporated into the Bound VolumeRobertson Grant: Oral Questions — Questions to Ministers[Sitting date: 10 September 2015. Volume:708;Page:6529. Text is incorporated into the Bound Volume.]5.GRANT ROBERTSON (Labour—Wellington Central) to the Minister of Finance: Does he stand by all his statements?Hon STEVEN JOYCE (Associate Minister of Finance) on behalf of theMinister of Finance: Yes in the context in which they were made.Grant Robertson: Does he stand by his statement that the Government has “left nothing ‘undone’ to tackle skyrocketing house prices in Auckland” given the Reserve Bank Governor’s call today for more to be done to address the lack of supply in the Auckland housing market?Hon STEVEN JOYCE: If the member has been paying attention the Government is working very hard on the Auckland housing market in areas such as combating speculators who are not meeting their tax requirements with bills which I think are currently before the House at the moment. There is also the work that is being done very much on lifting housing supply with special housing areas. In fact housing supply more generally is at its highest level in just over a decade.Phil Twyford: Where are those houses?Hon STEVEN JOYCE: A lot of work going—as I just said the highest level of construction in just over a decade. Also we have very significant investments going on in the social housing area. I think we are seeing a very significant housing response and I note that the Reserve Bank Governor also notes very high levels of construction activity in Auckland currently.Grant Robertson: In light of that answer was the Reserve Bank Governor wrong when he told the Finance and Expenditure Committee less than an hour ago that the Auckland housing market is in dangerous territory?Hon STEVEN JOYCE: Not necessarily at all and I think that it is important for people to understand that if they are buying houses you actually can pay too much for a house and there are risks because although interest rates are very low at the moment they do not stay low forever and people generally stay paying off their houses for a very long time. So I think it is appropriate for the Reserve Bank Governor to make comments about housing prices in Auckland because people do not want to make the decisions to pay too much. But in terms of the Government’s supply response it is the highest level of construction—Phil Twyford: Since the GFC.Hon STEVEN JOYCE: —since 2004 Mr Twyford.Grant Robertson: Is the Auckland housing market in dangerous territory?Hon STEVEN JOYCE: I am not going to paraphrase the Reserve Bank Governor’s comments.Grant Robertson: No I’m asking you.Hon STEVEN JOYCE: My response to that on behalf of the Minister of Finance is that there is a very significant supply response in Auckland but people do need to be careful about paying too much for houses in Auckland and therefore they should be concerned.Grant Robertson: I raise a point of order Mr Speaker. That was an extremely direct question which the Minister did not address—Hon Gerry Brownlee: He said: “I’m not going to”.Grant Robertson: No he said he is not going to—Mr SPEAKER: Order! [Interruption] Order! Can I just ask the member to have a look at Speakers’ Rulings particularly 187(4). It might assist him before raising such a point of order. Further supplementary questions? Supplementary question Grant Robertson—[Interruption] Order! Order on my right-hand side.Grant Robertson: Laurel and Hardy are a bit upset.Mr SPEAKER: Order! That is the sort of interjection that is totally unnecessary and I invite the member to stand and withdraw that remark.Grant Robertson: I withdraw. [Interruption] Ha ha! Is he concerned about the level of debt being carried by New Zealand dairy farmers given that it has increased from $12 billion in 2003 to $35 billion today and that dairy debt now accounts for 10 percent of our trading banks’ assets?Hon STEVEN JOYCE: I am not sure that I would look to relate the 2003 levels to today’s levels because actually there has been a very significant increase in the size of the industry over that period and a very significant increase in production. I note that the general consensus is that those levels are not of concern but obviously in their approach to increasing further debt at this point I think all farmers will be very responsible about that.Grant Robertson: Does he agree with the Reserve Bank Governor that a continuation of the downturn in China and having El Niño stretch further into the summer would lead New Zealand into recession particularly noting NIWA’s view that there is a 80 percent likelihood of El Niño carrying on into the summer?Hon STEVEN JOYCE: I do not think that the Reserve Bank Governor actually couched it in those terms. He was asked about things that could potentially cause a recession and there are things that could cause concerns. One of those could be a prolonged El Niño and there is another one that could be China but I do not think that he was talking about them in particular as leading to those things. The good news is that the New Zealand economy is very resilient and we have the capacity to adapt and respond and that is what we are actually seeing right now in combination with both the changes to the exchange rate and the changes to the interest rates and of course the Government has the continued opportunity to provide a fiscal response given that our books are in balance.Grant Robertson: How concerned is he then that the statement in his Budget in May that unemployment would drop below 5 percent has turned out to be completely wrong with the Reserve Bank joining Treasury today in predicting that unemployment will go over 6 percent and stay there for some time?Hon STEVEN JOYCE: I did not read it as saying that it would go over 6 percent and stay there for some time. Actually it said that it would reach 6 percent which is not necessarily a surprise given that we are currently at 5.9 percent. Obviously we are all keen for that to continue to come down. The way to do that is to encourage more investment in the New Zealand economy and in a range of industries and that is what this Government is doing.