NZ:Building Costs Plan Lacks Guts

Thursday, November 7th, 2013
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A raft of New Zealand government proposals aimed at slashing home construction costs miss the real issue of an uncompetitive suppliers’ market, Labour says.

In an options paper, released for public discussion on Wednesday, the government suggests simplifying compliance, changes to anti-dumping duties, and tariff concessions.

One issue considered in-depth is designers’ and builders’ specification that they must use certain brands to build.

The government says that promotes a lack of transparency for consumers about why those products are being used, and reinforces the position of incumbents in the industry, shutting out alternative brands.

The paper also considers cutting high import duties on building materials and inefficient and inconsistent behaviour by consenting authorities.

Housing Minister Nick Smith says building materials costs are too high, and can be as much as 30 per cent more than in Australia.

The options paper shows total residential construction costs increased by 30 per cent in real terms between 2002 and 2011, although the rise has been modest since 2008.

However, Labour’s housing spokesman Phil Twyford says it doesn’t go far enough to address a lack of competition.

“The government loves scapegoating councils and blaming them for the housing crisis. The question is, do they have the guts to confront the vested interests in the building supplies market?

“It’s taken them five years to produce a discussion document that’s a laundry list of concerns and focuses most of its energy, not on a lack of competition, but on a host of other things.”

He would not name those “vested interests”, saying only they are the “major players”.


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