Government shares out $1 billion Housing Infrastructure Fund among five councils - mostly in the top half of the North Island

By David Hargreaves

The Government's announced how it will divide up the spoils from its $1 billion Housing Infrastructure Fund.

It's named five councils - mostly in the top half of the North Island, with the lion's share of the money going to Auckland, Waikato and Tauranga.

The Labour Party says the Government's just trying to "pull a fast one" and has accused it of offering up "a list of ghost houses".

"This is loans for water infrastructure and bridges; National cannot point to a single plot of land and guarantee a house will be built there as a result," Labour's housing spokesperson Phil Twyford said.

"Even if [Building and Construction Minister Nick] Smith’s promises come true for once, they amount to less than 20,000 houses in five years, and just 2,200 in Auckland."

The fund, announced in high-profile fashion at the National Party's annual conference last year by then Prime Minister John Key, is to pay for water and roading infrastructure in high growth areas to accelerate house building. (See here for more details on the Fund)

On Tuesday, Prime Minister Bill English said the allocation of the $1 billion fund was "another milestone in the Government’s plan to increase housing supply for a growing New Zealand".

"The infrastructure projects announced today will speed up the delivery of 60,000 houses across our fastest growing population centres over the next ten years."

Auckland Mayor Phil Goff said accelerating housing delivery in Auckland was a priority.

"...While $300 million in new infrastructure investment will help Auckland address housing shortages in the city, it will continue to need billions of dollars of extra investment to keep pace with the city’s unprecedented growth.

"Auckland has received most of what it sought from the HIF. In the coming weeks there will be a further important announcement from Government on new funding options for Auckland that take into account the balance sheet constraints the city faces. We have worked constructively with Government to find innovative solutions to meet Auckland’s needs.

"The HIF package will help significantly, but with ongoing growth and the pressing need for matching infrastructure, we will need to continue to work together to increase and bring forward investment to tackle Auckland’s housing shortage and growing congestion, Goff said.

Finance Minister Steven Joyce confirmed that Auckland had additional housing infrastructure projects it was seeking help with outside of the Housing Infrastructure Fund "as it doesn’t have further debt capacity on its balance sheet".

"Discussion on those options are continuing and the Government will have further to say on those matters in the weeks ahead."

The Government says the councils that were successful in getting infrastructure funding will now work through Detailed Business Cases for the projects alongside government agencies, with the first funding agreement from the Housing Infrastructure Fund expected to be signed in the coming months.

A document produced by the Government, outlined in detail where the money was going and the expected outcomes. Included in the document was this detailed breakdown:

This is the Government statement released on Tuesday:

Five of New Zealand’s fastest growing Councils will have infrastructure projects funded through the Government’s $1 billion Housing Infrastructure Fund, Finance Minister Steven Joyce and Building and Construction Minister Dr Nick Smith say.

“These funding decisions will help provide another big step forward in housing supply,” Minister Joyce says. “The funding will be used to provide network roading and water infrastructure for 60,000 houses across nine projects in these five fast-growing urban areas.”

“The funding of this infrastructure is bringing forward the ability to build these homes in some cases up to eight years earlier than otherwise,” Dr Smith says.

“Adding these big new subdivisions will help lift the supply of residential sections and bring greater consumer choice into the housing market.”

The successful proposals are in critical high growth areas including:

·       Auckland Council – $300 million – 10,500 houses

Greenfield development (North-west) at Whenuapai and Redhills.

·       Hamilton City Council – $272 million – 8,100 houses

Greenfield development (Peacockes) on southern edge of Hamilton.

·       Waikato District Council – $37 million – 2,600 houses

Te Kauwhata (new development on the shore of Lake Waikare).

·       Tauranga City Council – $230 million – 35,000 houses

Greenfield development at Te Tumu (eastern end of Papamoa) as well as a capacity upgrade to the Te Maunga Wastewater Treatment Plant and a new (Waiari) water treatment plant (at Te Puke).

·        Queenstown Lakes District Council – $50 million – 3,200 houses

Two new greenfield sites (Quail Rise South and Ladies Mile) on the Frankton Flats and an extension of the Kingston township.

Proposals were assessed by independent experts and an independent evaluation panel recommended the agreed package to Ministers.

“The infrastructure to be funded includes a new bridge over the Waikato River, a State Highway interchange, arterial roads, water and waste treatments plants, pump stations and reticulation and collection networks, and storm water drainage”, Mr Joyce says.

“This infrastructure initiative is the logical next step in our housing programme. We have freed up planning constraints on new subdivisions through Special Housing Areas and reforms to the Resource Management Act but the areas zoned for residences cannot be built on without infrastructure. We will be working closely with the Councils and developers to ensure these projects are progressed at pace,” Dr Smith says.

“The next step is for the Councils to complete with the Government the detailed funding agreements which we expect to be concluded in the next few months. There is also a huge amount of work required on resource consenting and construction of the works. The first earthworks will be under way this coming summer, the first homes consented early in 2018 and homes completed by late 2018.”

The Government expects to make statements on further new funding options and tools for housing infrastructure in the coming weeks. 

This is the statement released by Labour's housing spokesperson Phil Twyford:

The Government’s housing infrastructure announcement is another Nick Smith special – over-promising with no detail on delivery, says Labour’s Housing spokesperson Phil Twyford.

“Like the Special Housing Areas, this is a just a list of ghost houses from a Government that has made an art form out of promising houses but never building them.

“Bill English and Nick Smith are attempting to pull a fast one. They’re claiming specific numbers of houses will be built, but they’re not actually providing funding for a single house.

“This is loans for water infrastructure and bridges; National cannot point to a single plot of land and guarantee a house will be built there as a result. Even if Smith’s promises come true for once, they amount to less than 20,000 houses in five years, and just 2,200 in Auckland.

“Only Labour’s KiwiBuild policy will actually build houses that Kiwi families can afford to buy and sell them to first home buyers at cost.

“There’s no doubt a huge infrastructure deficit has built up in New Zealand after nine years of National. Labour will change the way infrastructure is financed, tapping international bond finance and packaging it for new developments, with the debt serviced through a targeted rate on the properties in a new development.

“It will be fairer, more cost efficient, and it will turn on the tap allowing investment to flow into the infrastructure our cities need for growth.

“National’s so-called Housing Infrastructure Fund is simply a line of credit for councils who are already up against their debt limits. This policy was dreamed up by political staff and rushed out without proper advice from departmental officials after National was criticised for not addressing housing and infrastructure in their 2016 Budget.

“National is good at promising its latest half-baked idea will solve the housing crisis but, after nine years, Kiwis are left with a lot of ghost houses and not a lot else,” says Phil Twyford. 

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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53 Comments

“The funding of this infrastructure is bringing forward the ability to build these homes in some cases up to eight years earlier than otherwise,” Dr Smith says.

NOOOOOO!!!!!
- property bulls, probably

Don't worry property bulls, this is money being spent to build houses North West of Kumeu. It makes sure the land supply restrictions in Auckland are still enforced.

Auckland City house costs will only get elevated by the building of this infrastructure type and (as it removes lots of the burden of Auckland Council wastefulness from ratepayers) the property bulls get a rates discount. This is really an indirect subsidy towards sustaining wanton inefficiency of Auckland.

Toronto House Prices Crash 192k in just 3 months.
https://www.youtube.com/watch?v=hGL0ysImPCo

Auckland Albany House Prices Dive 13.5%
https://www.stuff.co.nz/business/property/94154549/house-prices-dive-in-...

The Mainstream Media Keep this very Quiet.

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20

I predict that actual results achieved will be broadly in line with Nick Smith's prior record of "successes".

For someone with a PhD in engineering, ironically he really isn't very good at building things.

PhDs are often the result of three years intense attention to a very narrow topic.
Maybe it was something to do with housing - like cave dwelling, possibly.
That just shows how Nick must have got his.
;-)

gained a PhD with a thesis on New Zealand landslides

https://en.wikipedia.org/wiki/Nick_Smith_(New_Zealand_politician)

In fairness, sending him out to stare at the landslides in Kaikoura may well be the most effective use of his time National could make.

Not fair, Nick Smith is great at building some things - mostly big long expensive roads. They need to go a long way to find a man more committed to big long, expensive roads than Nick Smith; probably as far as Phil Goff.

And he has defused a housing crisis or 7. Nick Smith has worked hard with Len Brown and Phil Goff - successfully defused housing crisis after housing crisis. The Wellsford, Warkworth, Silverdale, Kumeu, Hellensville, Pukekohe and Clarks Beach have all been completely solved. There is hardly a bit of countryside around any of the small regional towns of Auckland that hasn't been committed the building of suburbs (and roads, so many roads).

Only a solution to the Auckland housing crisis has eluded Nick. He must struggle with it so much, it is a real dilemma. He knows the solution is to open up land to Auckland, but that would mean no more big roads and then what would he do.

More houses better supply helps demand, shame these sorts of things can't be ready to go when government decides to play so heavily with immigration and keep houses at a more affordable level, say in 2014, always to late after the damage is done, which they caused, we owell a fix is a fix, national or labour this sorts of things will get done

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I personally think National has been most honest when they've publicly said they "don't want to see house prices come down". Thus, meaningful action is avoided for as long as possible and designed to have as minimal real impact as possible.

National is conservative and will generally just maintain status quo. Don't look to them for action that has an impact, especially one that might benefit younger Kiwis and potentially reduce the portfolio wealth of their core, older voter bloc.

Correct need solution : Vote for Change.

Though even that may help or not but after 9 years national has to go.

Who do you suggest we vote for and why?

National honest ? Now there's a laugh

I meant "more honest" like "pretty legal", in fairness.

Like Bill English was "more honest" about Todd Barclay in his statements the second time round than the first, which featured low levels of honesty.

City infrastructure should be paid through land taxes. Instead our government is taking money from workers and gifting it to landholders through this infrastructure spend. This is more exacerbation of growing inequality, and our growing class system of landholders and renters.

Ocelot helping in any way the supply of houses helps to stop houses going up , so then rents to, most of nz benefits, long as immigration is balanced sense able which going by the chatter in government it's a election year biggie

Do not worry

Nick Smith will be a vague memory in the annals of history by the time any houses are built

The Fund outlined above is for the infrastructure only. It will still need the peons to feel confident enough to saving up a deposit, navigate the obstacle courses of Council consents, finding builders, negotiating with banks, enter into a mortgage commitment before any houses emerge

So this infrastructure fund...is effectively just a subsidy for private developers so they developers don't have to fork out for all the infrastructure in their new developments?

More National party subsidies to private business rather than constructive building?

It's an interest free loan, so the zero interest cost is the subsidy, which is eventually passed on to home purchasers. The loan is repaid by rate payers over 10 years. So my income tax pays an interest cost subsidy to private home purchasers and my rates will likely repay their loan.

Another quarter of a $billion wasted on Auckland. This spending that doesn't need to exist and under any sort of sane planning on the part of Auckland Transport wouldn't be getting spent.

The Clark and Key governments built SH18 (Upper Harbour Highway) opening land to the North and West of Auckland to development. Auckland then banned development on 80% of this land and moved most North West development much further away.

So it is that today SH18 is sitting there ready to go, but we "have to" spend this $1/4 billion and more building new big infrastructure to much further away. Because Auckland Council hate the environment and want to make sure everyone has a really long commute or something.

Yes it'll probably only help the next boom ,if we ever get booms ever again with this large wages barrier we seem to have finally hit after many years, Of course we could always sell the country again

Clever reporting on this by the main newspapers. In the headlines and first paragraph, there is not mention that this "fund" is a loan. I don't think the average person would pick that up on a quick read.

The problem is almost exclusively an Auckland problem, right? Yet Auckland didn't even receive its 'fair share' of the fund by population. So Aucklanders are now subsidising infrastructure outside Auckland when we can't even pay for our own?

Auckland got to many hard expensive problems, slowly move the up and coming population to other parts of nz, let Auckland slowly work threw it , places like tga are small and new

Good to see the spends on the more productive housing areas in Tauranga and Hamilton.

Put on your best Dr Evil face, cock your little finger and say one billion dollars!.

$1bn is a drop in the ocean. Our humble little district of 50,000 souls owns about $1.5bn of infrastructure assets (at depreciated values). Using that rough rule of thumb the Housing Infrastructure Fund could support some 35,000 people living in 15,000 houses.

I don't actually understand what the scheme is supposed to achieve. Councils are supposed to have a 30 year view of infrastructure requirements. The first ten years of projects are supposedly already funded through development contributions if they are for growth.

Will councils refund development contributions? Will they bring forward projects from the 10-20 year time frame and make DC's for those developments cheaper? Who will pocket the difference?

Someone will do well out of this fund. But it is unlikely to be housebuyers. Can't see this scheme bringing down house prices any time soon.

$171 Million will get you 70,000 houses in a bit over 2 years in Tauranga, but for Auckland it takes $300 million to get 10,000 houses in over 8 years. If you ever wanted proof that Auckland is dysfunctional and not an economic proposition, there it is. The city needs to be held to account for being so useless at getting anything done. Maybe it is time for a statuary manager because the nation is pouring money into this city and not seeing results that warrant the investment.

I split some sections once in Tauranga, about 5 years ago, 2023 m2 into 3, I need 2 more titles, power had to come from across the road and power , water , phone and sewage had to be taken all the way down a right away that I had to concrete with two new concrete driveways from the road because the old house needed a new one, $114000 in total , these sections at the time wouldn't be worth anywhere near Aucklands prices but $57000 per section, hate to think what Auckland would charge and the extras and drama

The common taters who rail about 'subsidies to private developers' need to consider the sort of infrastructure that this is designed to jump-start:

  • Bridges which can used by anyone with legs, bikes, scooters, cars, SUV's, horses, B-trains etc. None of which, even if they cross 'em only once, being Tourists, have any necessary connection with the land thus being serviced. 'Public Good' is the phrase to search for.
  • For water and sewer, the usual need is for either duplication or re-lay of complete trunk mains, because the current capacity has been exceeded. Again, every connection - present or future - gains a benefit, because such work typically reduces sewer spills to streams (with downstream environment plusses), augments water supply (e.g. the Waikato supply to Awkland) and raises water quality for all. If interceptors are involved (think London, 1859, Bazalgette) then old, unwholesome discharges direct to groundwater are - er - Intercepted and piped away for treatment. These are all quite wide, diffuse, positive results.

The point is that diffuse benefits are hard to allocate, both across TLA boundaries, and as between areas of land. That's why central funding is a pragmatic solution.

The problem is so much is Good for the Public that funding one sort will prevent the funding of another.

A developer has chosen* to buy a cheap parcel of land miles away from Auckland to the North West of Kumeu. Why should the taxpayer centrally fund the miles of roads and water pipe out to that remote location, when there is so much land available closer to Auckland? Why should public money be used to support the viability of this sort of remote location?

* Now in the case of Auckland, we have to acknowledge that Phil Goff** makes it illegal for the developer to use land close to Auckland and the developer really has no choice.

** If Phil Goff had been organising the water supply augmentation pipeline it would be from the Clutha, because the Waikato is much closer and more cost effective. And Phil Goff would now be complaining about the government underfunding the crucial infrastructure of Auckland.

Looks to me that the Nats intend to keep the immigration tap on full bore. Seeing as we still, in the main, rely on agriculture for the bulk of our earnings, I don't think adding more people to the mix is that smart a move, to be frank. This is just growth (growth meaning more people) for its own bloody sake

You're just happy to see all the immigrants kicked out of the country and the house prices crash in NZ. Is that what you really want?

Perhaps no more immigrants in terms of increasing population, at least for now, and ban foreigners buying houses, then prices will either settle or crash back down to where they NEED to be, so that future NZers can afford to buy them. The whole thing is a complete c.... up and has been allowed to get to the point it has, and it is not serving younger NZers well, so whether you "crash" the market and end up with more realistic prices or you continue to cut people out of the market, someone is going to shed some tears. I will go for the longer view and the right thing to do for the future, which is NOT to have house prices so completely out of whack with kiwi earnings. The whole world, which incidentally includes NZ, needs to get its head around no more growth, can't think of a better place to start than here, before NZ too becomes overpopulated.

Totally agree pocket aces. The other part of the immigration debate is productivity. Our export earnings have gone down not up. We now have more people to be supported by the countries productive sector. Taxi drivers, school teachers, chefs, nurses, police and beneficiaries all have to be supported by the productive sector. Population growth without increased productivity means less for everyone. Of coarse the less for everyone is not evenly distributed. It is mostly a dept that young NZ has to pay for with increased land and housing costs and huge govt dept to pay for infrastructure.

I wonder how much of the gaping hole in productivity is down to half the retail, hospitality and services industry businesses being non-earning fakes that only exist to launder money and facilitate immigration fraud?

PocketAces, you will never be able to achieve this for several reasons. Most Kiwis want to be global citizens, free to travel and live anywhere in the world and most other people in the world yearn to be free and live the life of ex-British Empire Boomers. Africans, Asians, Indians and Muslims all over want to have the freedom and lifestyles these Boomers have. It should be a fundamental human right and the demand for it is irresistible.

As well as this the world's corporations want the global network of very culturally similar super cities built upon the bedrock of Christian civilization. All the people of the world will be free to wear the same clothes, have the same furniture, watch the same entertainment, eat the same burgers, drive the same cars, fly the same planes and have the same overseas holidays. It is truly a glorious vision of the future. Everyone is being absorbed into a new British Cultural Empire affectionately known as Multi-Culturalism. An Empire without prejudice.
Just watch the last three minutes of this documentary. (Start at 46:06)

The British Empire in Colour Part 3

You can trip around the world as much and as many times as you like, nowhere have I suggested you can't.

Free to travel and live anywhere I wrote. Wouldn't it be nice to have the choice of buying a chalet in Portugal and retiring there for instance? Kiwis want to be able to live and work anywhere in the world. I just don't see how we can stop this trend. If it is inevitable we might as well build a global culture that has a fundamentally British value system. We don't mind being culturally appropriated - I say go for it!

Here you go again - can't help yourself can you

Go out to Mangere Bridge's Te Puea Memorial Marae one evening, take your podium plus a microphone with you, stand there and harangue your audience with your elitist BS nonsense - Try telling them they are free to go and travel and live anywhere (in the world) and tell them they have the choice of buying a chalet in Portugal and retiring there

Would you like to pre-book an ambulance now?

PS
Mangere Bridge's Te Puea Memorial Marae to reopen its doors to the homeless
https://www.stuff.co.nz/auckland/local-news/manukau-courier/94393919/man...

I really hope that same media witch hunt that took place last year doesn't happen again.
It utterly unforgivable.

I'd love to see ZS take his podium anywhere other than Mike Hosking's backyard.
It would be a rude awakening.

Two otherguys and nymad.

Interesting reaction. The power of the Zeitgeist has proven that your concerns about the reaction to my ideas from certain groups are most likely correct. Just the other day the hero of the French people, Macron, almost did exactly what you suggested.

Macron addressed African issues during the June 7-8 G20 summit in Hamburg, Germany. However, the video of his speech was released on social media only on Monday. It could have almost been ZS addressing the poor people:

The president said the African continent’s problems were not economic, ecological, or political, but demographic.

“When countries still have seven to eight children per woman, you can decide to spend billions of euros, but you will not stabilize anything,” he stated.

Hoo boy, he is in in a bit of hot water for telling the truth. African problems are the result of "poor life choices".

When I saw the anti-fa attacking the G20 meeting as well as attacking young Identitarians I experienced an epiphany. I suddenly realized, the G20 were my people.

Ponder upon this photo of the G20 leaders in relation to what I was saying about a global culture. Looks like they are wearing a uniform. The lounge suit developed by Beau Brummel, a quintessential English gentleman.

Poor life choices?? POOR LIFE CHOICES!!! What? They made the poor choice to be born into a culture where women don't get much of a say in how life goes for them. POOR BLOODY LIFE CHOICES? And you wonder why so many on here take pot shots at you. Good giref

PocketAces, a culture is a human artifact and thus a product of human choices. If their culture is oppressing them and making them do things against their will then someone is making those choices, presumably men, so I stand by my claim of "poor life choices".

I do wonder why people take pot shots at me actually. My assertion that people coming to NZ should strive to master English and buy into a value system based on British traditions is so thoroughly sensible. If it is sensible for us, and all the data supports my assertion, then it is also sensible to do this in their own countries. Your own comment highlights this as you acknowledge that other cultures don't give individuals "much of a say in how life goes for them". Why on earth would we want to change what we have now for something much worse? The English language and British tradition had laid the foundations for the greatest level of individual freedom that we have ever observed.

In a logical world where we overcome ego and superstitious nonsense all people would strive to build societies like we have now and robustly defend them. If we could convince the former British colonies in the Third World to revisit British values there is no doubt in my mind that their people would experience a huge lift in living standards and individual freedom. indeed we always assumed that this is what immigrants desired. The push to make it easier for immigrants to participate in industry, art, entertainment and the government is all about their desire to become essentially Western just like us.

PocketAces,

No point in getting upset by Zachary. I increasingly think that his posts are a spoof,they are so bizarre. He is a caricature of a staunch Victorian imperialist. Now he isat one with the G20,but in other posts,he has expressed his admiration for the Alt-Right,so I think someone is just taking the piss.

Linklater01, who were protesting the G20 meeting in Hamburg last week? Certainly not the Alt-Right. Marxists, the AntiFa and Anarchists. In the G20 we see Trump and Putin as well as China, Turkey and Japan who are nationalist countries so the connection is not as far fetched as you would first suppose.
My focus currently is on the general attack on Western values. I have noticed that people like yourself, Nymad and even DC are equating the defense of Western values with the extreme Right wing. If you want to robustly defend Western values then you must be a Fascist or something. Don't you know that all values are equal?
I believe people are waking up to this nonsense. No one wants this geriatric, group-hug, Kumbaya, Boomer stupidity anymore, it's just ridiculous. If we don't respect our own values then new immigrants certainly wont either and they will probably seek to replace them with something stronger like their own ones. We are seeing this happening in Europe already. It is a recipe for disaster.

Auckland is open for the citizens of the world, not just New Zealanders. We are a global city after all and should be fair to all global citizens.

Auckland and New Zealand are practically #1. A shining city on a hill for all the world's peoples. We have gone too far down the path to turn back now anyway.

Zachery, we are not global citizens. We can't go and live or purchase land where ever we want. Other countries protect their citizens from foreign buyers. Other countries protect their citizens ability to be able to afford to function economically in their country of birth.
It is easy for wealthy NZers to spout the virtues of globalization as they are the beneficiaries. Your wealth gained from NZ real estate is at the expense of other NZers.

Northland Hippy, I understand totally where you are coming from. I'm working on the inside of the Empire, trying to make the most of a bad situation. If invasion is inevitable then we must ensure that the invaders become the conquered. There are many historical precedents for this occurring although globalisation is something entirely new. I think the best systems will prevail.

Invasion is only inevitable because we are allowing it to happen. We can say no more. I'm probably voting Winstin. But I did email them and the Greens to ask what their policy is towards supporting the USA and their invasions and attacks. Neither party has responded so my vote still floats.
The Greens wanting to bring in more refugees when we are helping make the refugees seems like hypocrisy to me.

Toronto House Prices Crashing 192k in just 3 months.
https://www.youtube.com/watch?v=hGL0ysImPCo

Auckland Albany House Prices Dive 13.5%
https://www.stuff.co.nz/business/property/94154549/house-prices-dive-in-...

The Crash Is Coming.