2 June 2016

Less planning more choice needed

BusinessNZ has welcomed the Government’s National Policy Statement on Urban Development Capacity but says it may not address long-term issues around land supply.

BusinessNZ Chief Executive Kirk Hope says a gradual approach to dismantling metropolitan urban limits is not decisive enough to stem dramatic imbalances in land and house prices.

“This National Policy statement correctly calls into question the role of planning itself. Problems with undersupply of housing in Auckland stem from overly restrictive planning. Land value should be set by its highest value use and markets should be allowed to find that value.

“Planners and regulators cannot be expected to keep up with market changes as quickly as market participants can. We need a more market approach to housing provision, as this can be more responsive and flexible than a planning approach. This National Policy Statement still focuses too much on planning and not enough on allowing markets to work. Home-owners and businesses are best placed to make individual choices reflecting their needs and wants rather than having planners make decisions for them.

“As long as developers pay the economic and environmental costs of associated infrastructure, development should be allowed where business and homeowners choose to build.

“A more direct and urgent approach to removing urban limits is needed,” Mr Hope said.

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