Gordon Campbell | Parliament TV | Parliament Today | Video | Questions Of the Day | Search

 


Council development charges reined in to assist housing

Hon Dr Nick Smith
Minister of Housing

Hon Chris Tremain
Minister of Local Government

15 August 2013

Council development charges reined in to assist housing affordability

The Government has decided on changes to the Local Government Act to rein in council development contributions to improve housing affordability.

“We are going to narrow the charges councils can put on new sections, provide an independent objections process and encourage direct provision of necessary infrastructure to get costs down,” Housing Minister Dr Nick Smith and Local Government Minister Chris Tremain say.

“Development contributions have trebled nationally over the past decade and have gone up more than any other component cost of a new house. This huge increase can be attributed to the local government law change in 2002 that gave councils carte blanche to charge whatever they liked and removed any check or appeal on these charges. These charges now average $14,000 per section but can be as high as $64,000 per section,” Dr Smith says.

“There is no magic bullet to improving housing affordability and we need action on many fronts to get costs down. This initiative restricting development contributions is part of a package of measures the Government is taking including substantive reforms to the Resource Management Act, the Housing Accords legislation, the inquiry into building materials costs, changes to the Building Act to reduce compliance costs, and the expansion of the Welcome Home Loans and KiwiSaver First Home Deposit Subsidy,” he says.

“Development contributions need to be set in a way that fairly balances the costs that should rightly rest with a new development and those of community benefit that should be paid by general ratepayers. There will always be pressure on councils over rates and we need a check on development contributions to ensure the new home owner is not over-charged,” Mr Tremain says.

“These changes will also restrict what councils can charge in respect of commercial and industrial developments. These charges, if applied beyond the costs of providing the necessary infrastructure, end up as a tax and discouragement on new investment and jobs. The changes mean that councils will only be able to charge for new infrastructure and not recreational facilities or reserves for developments that do not involve residential housing.

“Councils will still be able to charge for infrastructure and resources directly associated with a new subdivision. These changes are about improving transparency, encouraging councils and developers to work innovatively on minimising costs through development agreements and ensuring funds collected for infrastructure in an area are spent as intended.”

Changes to development contributions was recommended by the Productivity Commission’s 2012 report into housing affordability and are included in the Government’s Better Local Government reform programme. A discussion paper was released in February and final decision on the policy changes made by Cabinet on Monday. The law change will be included in a Local Government Reform Bill to be introduced to Parliament later this year.

The Cabinet Paper can be found at www.dia.govt.nz/Better-Local-Government#development-contributions

ENDS

© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

Gordon Campbell:
On The National Leadership “Contest”

Key’s endorsement of English has turned this “contest” into a race for second place.

This succession was well planned. Lets not forget that English was told by Key in September of his intention to resign, and English was the only member of Cabinet entrusted with that information before it was sprung on everyone else on Monday morning. More>>

Latest: Judith Collins and Jonathan Coleman have withdrawn from the leadership race, leaving Bill English the only candidate to replace John Key as Prime Minister.

 

Education: Charter Schools Misleading Pass Rates

Labour: NCEA results for charter schools have been massively overstated... In one case a school reported a 93.3 per cent pass rate when the facts show only 6.7 per cent of leavers achieved NCEA level two. More>>

ALSO:

Rebstock Report Resolution: SSC Apologises To Derek Leask And Nigel Fyfe

Following a complaint by Mr Leask, the Ombudsman found that the State Services Commission acted unreasonably in relation to Mr Leask and identified numerous deficiencies in the investigation process and in the publication of the final report and in the criticisms it contained of Mr Leask... More>>

ALSO:

International Rankings: Student Results 'Show More Resourcing Needed'

NZEI: New Zealand had only held relatively steady in international rankings in some areas because the average achievement for several other OECD countries had lowered the OECD average -- not because our student achievement has improved. More>>

ALSO:

Earlier:

Salvation Army Report: Beyond The Prison Gate Report

A new Salvation Army report says changes must be made to how prisoners re-enter society for New Zealanders to feel safe and secure in their homes and communities. More>>

ALSO:

Surprise Exit: Gordon Campbell On The Key Resignation

The resignation of John Key is one thing. The way that Key and his deputy Bill English have screwed the scrum on the leadership succession vote (due on December 12) is something else again. It remains to be seen whether the party caucus – ie, the ambitious likes of Steven Joyce, Judith Collins, Paula Bennett, and Amy Adams – will simply roll over... More>>

ALSO:

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
Parliament
Search Scoop  
 
 
Powered by Vodafone
NZ independent news