02 November 2012

Key Notes: The Prime Minister's newsletter

In this issue:

Improving housing affordability
Investing in infrastructure
Rebuilding Christchurch
A more productive economy

Improving Housing Affordability
On Monday I announced measures the Government will take to improve housing affordability over the long-term.

There is growing concern that getting on the first rung of the home ownership ladder is a large stretch for too many New Zealanders. The cost of home ownership is too high, partly because there isn't enough land available for residential purposes.

We'll be making changes to reduce costs and complexities that act as a barrier to home ownership. We'll also work with local government to increase land supply. While there is no quick fix, we expect our broad work programme will restrain housing prices over time.

Find out more here.
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Building a more productive economy
One of our priorities for this term in office is to build a stronger economy based on savings, and investment in productive assets.

Because of the high cost of home ownership, most Kiwis need to borrow large amounts to buy a home. This has implications for our economy. It means money invested in housing debt cannot be invested in more productive assets such as businesses, or other assets in our economy.

Our changes to help increase housing affordability will allow more Kiwis to climb onto the property ladder. Less investment in housing and more in other assets will help restore balance to our economy and is part of our plan to build a brighter future.

Our opponents promise a capital gains tax. They say this would help curb the increase in housing prices. Their argument is flawed. Adding a new tax to our economy would do more harm than good and would be very complex to administer. A capital gains tax would apply to every productive business hurting the economy, growth, and jobs.

Investing in Infrastructure
Yesterday, a number of senior Ministers were in Christchurch to release the Government's fourth Business Growth Agenda progress report. Our Business Growth Agenda is a programme of initiatives to help Kiwi businesses grow, hire more staff, invest in their future, and compete on the world stage.

Providing business with access to critical infrastructure - like roads, rail, and ultra-fast broadband - is one of the most important things the Government can do to help build a more productive and competitive economy. Our infrastructure progress report shows we are making progress in 67 areas to help grow the economy, and deliver more jobs, higher wages, and better living standards for all New Zealanders.

In brief

Rebuilding Christchurch
This week, the Government completed the residential zoning process for Cantabrians. This is a significant milestone in the recovery, and will help give homeowners in wider Christchurch some certainty about their future.

Read more about our progress in Christchurch here.

Did you miss these important stories?

You can now apply for a passport online, and we've reduced the cost of doing this.

Construction on the National War Memorial park has begun.

From my diary
Today I'm enjoying a two-day visit to Dunedin. I've taken time to visit the redevelopment of the new Speight's brewery, as well as handing out this year's Class Act awards to young leaders.

Next week I'll be in Wellington for another week in Parliament.

Regards,

John Key
Prime Minister
ends

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