More houses or not more houses, that is the question that's starting to create real tension inside the National Party as one of the government's key economic policies comes under pressure from its own

Internal tension. It's not something National has had to worry about much during the Key years. But that makes the Auckland Council's u-turn on its plans for housing intensification all the more fascinating; because it pits the National Party against some of its core voters.

The Auckland Council this past week bailed out of plans that had been rushed through since late last year, to scale up the intensifications for the city. Critics of the council's latest plan say it was handled with next to no consultation, and it's hard to say otherwise. But they also insist that the 2013 plan the council now reverts to by default leaves plenty of scope for more intense housing, and that's harder to buy.

The council's own figures project that the city will need 280,000 more houses by 2040 and the 2013 plan delivers just 80,000. Hence the panicked rush late last year to add these "out of scope" plans.

Whether the 2013 plan delivers 80,000 or more, it's hard to see how it will deliver anything less than significantly fewer houses than needed (even if you think the population modelling that leads to the 280,000 houses is flawed). It's just not enough houses.

That seemed to be at the heart of the complaints by Generation Zero and others, that this protest and the council's subsequent back down is shutting young Aucklanders out of the property market. That many of the protesters responded to the concerns expressed by those representing young Aucklanders with mocking shouts of "poor you" was a disgrace. It was a 21st century version of 'let them eat cake'.

I don't know enough to know whether the 2013 plan can be upscaled sufficiently to add enough houses or whether it'll now simply be up to the Independent Hearings Panel to come up with strong recommendations that push the council to do more. But Finance Minister Bill English is clearly banking on the panel to pull his party out of a property pickle.

Because what's clear is that the council u-turn means fewer houses, and for that the government cannot stand. Rapidly increasing Auckland housing supply is central to its economic plans, and therefore its political fortunes.

English has made it clear before that without lots more houses, we'll see higher interest rates, slower growth and, of course, ever higher house prices. This morning on The Nation, he warned of a "price spiral" if Auckland doesn't act.

"We’ve just made it pretty clear that we’d expect the plan will deliver enough room for the houses that are needed in Auckland. Because if it doesn’t, we’ll end up going back into a price spiral, and we’ve talked about the risks of that for the last couple of years... if the plan is seen not to deliver the supply that’s required, you’re likely to see upward pressure on the prices. Now, by historical standards, Auckland house prices are already pretty high"

That would be disastrous for New Zealand. And National. So why isn't English kicking into those trying to slow down the intensification? Housing Minister Nick Smith has in the past talked enthusiastically about "staring down" the NIMBYs. So why is English playing it cute, saying this is "a legitimate community discussion" when the implications are, by his own prognosis, dire?

It's because those eastern suburb protesters (Smith's NIMBYs) are loyal National Party voters. Indeed, one of the key figures in the revolt is Orakei local board chair Desley Simpson, the wife of National Party chair Peter Goodfellow.

So, in bald terms, leading Nats are working hard against one of National's key economic policies. It's what you might call... awkward.

English today pretended not to know who was leading the charge against what they see as excessive intensification and the risk of bad urban design. But that's nonsense. He's simply trying to get to avoid civil war. If this was a Labour councillor, Sue Bradford or just about anyone else leading this charge, it would 'NIMBY this' and 'economic sabotage that'.

Despite his commitment to maximise housing growth in Auckland, he wouldn't even back Phil Goff's proposal to sell Remuera golf course for more houses(it's worth "scrutiny", Goff says). That's a real cat amongst the pigeons suggestion by Goff and his advisers, trying to rupture  what's left of the right-wing consensus in Auckland. English again pretended to know nothing about it, even though economist Shamubeel Eaqub spent much of last year banging the drum for the idea.

Instead, English suggested -- against everything else National says about the urgency of more houses in Auckland -- that the wealthy eastern suburbs could get a free pass.

“The government has made it clear. It needs to see a plan ultimately that enables enough houses. And if that means more in the south and the west out on the edge of the city, well, that’s where they’ll go”.
 
Which suggests that the rich, white people of Orakei could win the political battle, forcing more intensification on the poorer and browner south and west of the city. what's more, growth could be more "out" on the city's edge than "up" in the city's central suburbs.

But the cost of infrastructure that would require would have to be a real concern to... the Finance Minister. In other words, English needs to be careful what he wishes for.

Already National is starting to get tangled. English and co will hope that the hearings panel come along and push the Council in the right direction without having to get their hands dirty. But their own members will still fight that, so it's hard to see how some sort of serious internal tension can be avoided.

It could be one of the greatest tests yet for Key's famous discipline. 

 

Comments (14)

by Andre Terzaghi on February 27, 2016
Andre Terzaghi

A cluster of high-rise apartments on part of the Remuera golf course, and the rest of it turned into open-access park. It seems such an obvious solution to partly alleviate the problem...

by Luke on February 28, 2016
Luke

Worth also keeping in mind that National aligned figures in south, west and rural north were at the forefront of the battle against the backdown. So splits within Auckland National party, not just between govt and local party. 

by Peggy Klimenko on February 28, 2016
Peggy Klimenko

"Critics of the council's latest plan say it was handled with next to no consultation, and it's hard to say otherwise."

This is at the core of the problem, from what I've heard and read. The residents of the wealthy white suburbs have as much right to be consulted, and not to have last-minute changes of this sort foisted on them, as anyone else. Indeed, I'd expect owners of expensive real estate to be vigorous in pursuit of protecting their property values.

Auckland Council's actions won't be unfamiliar to Wellingtonians: Wellington City Council has attempted a similar strategy in the inner-city suburbs. In Johnsonville, Council has pushed through new rules over the objections of residents. It's now trying the same tactic with Khandallah, Karori and Island Bay.

The residents of Khandallah have forced Council into more extensive consultation than it had intended; we are very sceptical about what's being proposed. Council cannot tell us what it envisages for intensification, its rationale - providing smaller houses and apartments for older residents who want to sell down - is challengeable on so many levels. Moreover, Council intends that such housing intensification projects would be non-notifiable. Most of Khandallah is built on the hills; sunlight and views are precious and fiercely protected. It's highly likely that some of us could discover that a 3 - 4-storey apartment block is to be constructed on our north boundary, and we'd have no means to object to it. I'm guessing that a similar rule would have applied in Auckland.

Andre Terzaghi: "A cluster of high-rise apartments on part of the Remuera golf course...."

We used to live quite close to the Remuera golf course. As far as I know, it's still being used. So what are you suggesting? That the members are turfed out summarily?

There is quite a lot of housing bordering the course: would you envisage said high-rise apartments being sited right on existing residents' north boundaries? I'll bet they'll just love that. Especially if such a development ended up looking anything like Stonefields....

The causes of the housing crisis in Auckland are multifactorial and the problem cannot be solved just by filling up every empty - or forcibly emptied in the case of the Remuera golf course - space with high-density housing. Government needs to get a grip on the other issues, but it will not, being mired in an ideology that prevents it doing so.

by Tim Watkin on February 29, 2016
Tim Watkin

Peggy, yes the suggestion – started by Shamubeel Eaqub and picked up by Phil Goff – is to turf out the golfers. Although since the idea has been mooted they've cunningly extended their lease. But, apart from the urgent need for new houses near existing infrastructure, here's one of the rationales, as presented by Bernard Hickey last year:

Did you know that 1400 members of the Remuera Golf Club receive the exclusive benefit of a piece of Auckland Council-owned land valued at up to $517 million?

The club pays rates of $130,000 a year. If up to 70 per cent of that land was broken up and sold for housing and the rest left in parks, it would produce revenues of $16.5 million a year.

That's an annual subsidy of $16.37 million, or $11,700 a member. That includes Prime Minister John Key, who is an honorary member.

Even if each member played 50 rounds a year, that would be a subsidy of $233 per round or $13 a hole.

by Tim Watkin on February 29, 2016
Tim Watkin

And Peggy, yes the lack of consultation was a problem. The council muffed the process. But, as far as I understand, it was out of desperation not cynicism. The council agreed to an intensification plan in 2013, which was watered down late in the day by this anti brigade. Then in, I think, September last year, the numbers came through and the council realised that plan would get them only around 80,000 new homes by 2040. They need 280,000. Panic ensued and the council tried to find some "out of scope" ways of adding to the number of homes, without consultation.

That's the way several sources have explained it to me. So bad process, but to carry on and aim for just 80,000 (or even double that), would be an utter failure of council, a block to the next generation and a risk to the NZ economy.

by Fentex on February 29, 2016
Fentex

the exclusive benefit of a piece of Auckland Council-owned land valued at up to $517 million

People keep using language about exclusion regarding Remuera Golf Course obviously trying to invoke anger at privilege but I find with a minutes attention to the web site exactly the same welcoming attitude to the green fee paying public as every other golf course In New Zealand (like the country course at Waikouaiti I stopped by to play a game on driving to Dunedin this weekend).

And it annoys me that people try to use a wedge of their dislike of a game and personal concept of it being exclusive in New Zealand where my whole life people from everywhere have mixed playing different sports and pursuing different past times together.

It really irritates my egalitarian instincts to read people try and push class politics into the pleasant past times that makes New Zealand a nice place to live.

As it happens the Remuera Golf Course is land I believe was gifted for the express purpose of recreation or a reserve. I am under the impression it isn't available to be used for housing, private or otherwise.

by Andre Terzaghi on February 29, 2016
Andre Terzaghi

Tim, thank you for covering that better than I would have.

Peggy, thoughtfully choosing which areas to leave as park would go a long way to mitigating the impact on existing residents. Sadly, that "thoughtfully" part seems to missing in local developments, which adds to legitimate local fears and resistance.

Fentex, perhaps the Remuera golf course is indeed welcoming to walk-up players with greens fees in hand. But I bet it's not welcoming to picnickers, families with kids that want a run-around etc etc. It's not golf I find offensive, it's the way golf clubs reserve large amounts of land for the exclusive low-density use of a select few. In a very eco-unfriendly way.

by Fentex on February 29, 2016
Fentex

It's not golf I find offensive, it's the way golf clubs reserve large amounts of land for the exclusive low-density use of a select few. In a very eco-unfriendly way.

If, as reported, the land the Remuera Golf Course is on was gifted for use as a golf course or public reserve then I think an argument could be made, especially if Auckland intensifies it's housing, that the land would be better used for a reserve and park for people living with less room for their own homes.

However I don't believe your protestation about not disliking golf (or golfers) when you use language about "a select few",  and I'm curious - what is eco-unfriendly about a golf course?

by Andre Terzaghi on February 29, 2016
Andre Terzaghi

Golf courses on average tend to use huge amounts of agri-chemicals, which are toxic to the smaller end of food chains, and run-off readily. And if the base of the food chain is missing, so is the rest of the ecosystem. I'm not sure I can find it, but I have a strong recollection of an American study of several golf courses set in regenerating forest that suppressed (inadvertantly to be sure) the local ecosystem for quite a wide zone around the courses.

"Select few" refers to the fact that regular golf players are a very small proportion of the population, and that non-golfers are excluded from using golf-course public lands. It's not a socio-economic sneer in the New Zealand context, although it certainly would in most of the US.

by KJT on February 29, 2016
KJT

The solution that worked in the past was State housing.

Now being vandalised along with most of our societal infrastructure.

Regional development and encouraging businesses to base themselves outside Auckland have also proven to be effective.

by Tim Watkin on February 29, 2016
Tim Watkin

Fentex, where have you seen it said that it's not available for housing? Interesting.

by Fentex on February 29, 2016
Fentex

The subject came up a couple of months ago on blogs and several people argued over who actually owned the land ad what rights the council had to it. The golf course is built in Waiatarua Reserve which was gifted to Auckland in 1918 for recreation purposes.

I don't know exactly how much that may tie the councils hands, I have yet to see anyone report on a detailed investigation of the gift and it's terms but I imagine it complicates the assumption they can just decide to do it.

by Peggy Klimenko on March 01, 2016
Peggy Klimenko

Tim: "...here's one of the rationales, as presented by Bernard Hickey..."

Yes, I remember seeing that last year. I didn't find it convincing then, either. I'm not a golfer, so this isn't special pleading. But the nature of golf is that it requires a considerable amount of space; it isn't clear to me why people should think it unexceptionable to turn an urban golf course into a housing estate, yet they wouldn't dream of suggesting the same thing for Eden Park. When we lived in that area, I remember the golf course as offering considerable amenity value to local residents.

I take the point about the need for housing to be sited where there is existing infrastructure. However, people need to remember that a large population increase will put possibly insupportable strain on said infrastructure. Anyone who doubts this should walk down Victoria St in the CBD - as we've been doing recently - and sniff the pong of the drains and sewers. That's infrastructure under serious population pressure, I suggest.

"They need 280,000. Panic ensued and the council tried to find some "out of scope" ways of adding to the number of homes, without consultation."

Two things about that. Firstly, it's instructive to note that, when the chips are down, consultation is ignored. This tells us the ratepayers a great deal that's not particularly complimentary about the shallowness of Councils' commitment to democracy. We've had the same issue here; at our public meeting, many of us reminded Councillors that they are elected to represent us, and Council officers' job is to serve our interests, not the other way about.

Secondly, 280,000 houses by 2040 sounds like a wildly implausible proposition for Auckland. Which is of course why the government ought to be dealing with the other issues contributing to the housing shortfall.

Andre Terzaghi: "..thoughtfully choosing which areas to leave as park would go a long way to mitigating the impact on existing residents."

Perhaps so. So might thoughtfulness, as applied to the design of intensive housing. I'm guessing that this element was missing when Stonefields was developed?

In general, the housing imbroglio in Auckland appears to be morphing into an intergenerational stoush, with rich white boomers being blamed for Generation whatever-it-is being unable to get into housing. According to the narrative, boomers got the free education and healthcare, and the cheap houses, then pulled up the drawbridge on the next generation by implementing Rogernomics.

Of course that's nonsense. In the first place, the architects of Rogernomics weren't boomers. Secondly, many boomers were seriously screwed over by Rogernomics' effects on the economy, to the point that a significant number never recovered economically. Thirdly, many of the rich white (or not) people of the rich eastern suburbs aren't boomers at all: they're much younger - and in some cases,much older. Really, it's just facile to blame boomers for a housing crisis, the causes of which are complex and deep-rooted.

by Charlie on March 06, 2016
Charlie

I don't see this as a National Party problem. It is a political party of central government and has kept well out of the local stuff. It has no candidate in this election and has offered no support to anyone.

What we have here is a dysfunctional and incompetent council. As an example their latest IT fiasco is going to cost us more than the South Canterbury Finance meltdown!

On to the solutions:

Auckland needs to both grow horizontally and vertically. There is ample land outside the existing (arbitrary) borders and a stroke of the pen will sort that out. If that doesn't happen people will build (they are already) in satellite towns. (Huntly - buy whilst prices are low! :-)   )

There is also ample land within Auckland to add apartments. It's just plain stupid to plonk apartments along the east coast bays where there is already good quality housing stock and there is no proximity to transport. With a modicum of creativity and a decent consultation plan, more suitable locations can be found. Near shopping centres and offices. Near rail stations or close to the CBD. For example drive along K road and New North road and you'll see a string of car yards and low rise workshops. Does London have car yards near St James Park? Look around and you'll find lots of opportunities.  Take a look at the area around Lynn mall and the train station - more low rise light industrial that could go. Waterview and Te Atatu wil soon both have excellent motorway access. Those areas could easily accommodate a few apartment blocks if the council made it worthwhile for the owners to develop....

...because that's the other thing. The council has burdened developers with such unreasonable levies that growth has been killed off.

Sheet the problem back to the owners - the council.

 

 

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