Advocacy in a Nutshell | December 2019

Welcome to the December edition of Advocacy in a Nutshell; the latest update from our advocacy team, featuring all of the projects, policy and issues that matter to you.

This month we're talking about:

  • Introduction of the Urban Development Bill
  • Productivity Commission releases final report on Local Government Funding and Financing

Introduction of the Urban Development Bill 

Last week, the Government released the Urban Development Bill, providing Kāinga Ora – Homes and Communities with enabling powers to facilitate large scale urban development. 
Property Council has long advocated for an urban development authority and we applaud the Government for introducing the Urban Development Bill. 
The Bill will enable Kāinga Ora to undertake Special Development Projects (SDPs), which are large-scale, complex urban developments designed to drive real change and urban renewal that will shape cities and create communities. 
Property Council chief executive Leonie Freeman says, "empowering Kāinga Ora with ability to acquire and transfer land for the purpose of urban development will ease the way for quality, sustainable development that will better serve New Zealand’s growing population”. 
“By accelerating the availability of build-ready land, and building quality urban developments, we have an opportunity as an industry – and a nation – to connect homes with jobs, transport, open spaces and infrastructure. It’s all about building communities where people can live, work, play and shop.” 
“While Property Council supports the Bill in principle and believe that it could have a positive impact on our cities, we need to work through the detail of the legislation to ensure it delivers on the objectives the Government has set for it”, says Freeman. “In the first instance, we note that the process to establish an SDP is lengthy and want assurances that every attempt will be made to streamline it. We also suggest that private developers be consulted during the initial assessment stage to ensure industry buy-in and input is considered”.
“We look forward to working with the Government and opposition during the passing of this Bill, providing a collective property industry perspective during the consultation process.” 

The Select Committee consultation on the Urban Development Bill is likely to be open until early next year.

> Read more about the Bill

Productivity Commission releases final report on Local Government Funding and Financing

Property Council welcomes some recommendations in the Productivity Commission’s final report on Local Government Funding and Financing however is disappointed that it removed the recommendation to abolish differential rating for business.  

Property is the backbone of the New Zealand economy. Good, sustainable development has the potential to shape cities and enable communities to thrive. While some of the Productivity Commission’s recommendations will bring welcome change, our members believe more can be done to address system-wide failings that prevent critical investment in New Zealand’s infrastructure.

We are pleased that the report provides some useful recommendations for expanding Special Purpose Vehicles (SPVs) to pay for much needed infrastructure. In recognising that growth is not paying for itself we support Government attempts to look at alternative funding mechanisms which spread debt over generations. The Government’s introduction of legislation in the coming weeks which expands the use of Special Purpose Vehicles to finance investment in growth infrastructure is encouraging. 

While we welcome the Commission’s recommendation that Councils should assess business rates in proportion to the cost of the council services that benefit them, we are disappointed the Commission didn’t go further in recommending their abolition. Councils should not continue to burden commercial properties with higher rates to raise revenue without reflecting benefits.

We are encouraged by the recommendations to standardise the structure and format of councils’ development contribution (DC) policies and will work closely with Government, Local Government New Zealand and the New Zealand Society of Local Government Managers to develop these templates.  

A holistic approach is needed when considering how central government plays its part. We are pleased that the Commission is recommending consideration of a new funding stream from central government highlighting growth not paying for itself.   

There is a heavy reliance on developers paying the lion’s share towards new infrastructure. We implore Government to pay development contributions on all projects it undertakes in line with local authority policies to help support the local government funding deficit.

We hope the report encourages both local and central government to follow through with many of the recommendations from report rather than shelve them like previous local government funding inquiries.   

> Read the full report

Author | James Kennelly

As Property Council's Head of Advocacy, James leads our advocacy team with sound judgement, a natural flair for communicating the complex and an easy-going manner that makes him approachable yet reliable. Based in Wellington but frequently found in all corners of the country, James has his finger on the pulse of central and local government, providing valuable insights for our membership and acting as the conduit between our members and the country's movers, shakers and policy makers.

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