It’s highly unlikely the first KiwiBuild target will be met – but this doesn’t mean it has been abandoned

Some people were listening closely to Housing Minister Phil Twyford on RNZ’s Morning Report, when he said he couldn’t guarantee his signature KiwiBuild policy will meet its first deadline – 1000 homes built by July 1.

Twyford’s reluctance to guarantee the target represents a significant backdown for the Minister on the policy to build 100,000 affordable homes over 10 years.

And right there a good interviewer had material for robust follow-up questioning.

But RNZ’s Guyon Espiner, the Morning Report co-host, turned a failure to guarantee the target would be met into an assertion the target had been abandoned – an assertion he repeated even when the hapless Twyford insisted he hadn’t abandoned it.

This was a distortion of the sort that  spawns fake news.

As Stuff reported, the 1000-home target was set as the first step of a massive ramp up in the construction of affordable homes, to be followed by 5000 homes in the following year and 10,000 the year after that.

But with less than six months to go, just 33 homes have been completed and another 77 are under construction. Over 4000 are contracted out to be built.

Stuff explained that KiwiBuild aims to fill a hole in the market where just 5% of new builds are priced in the lower quartile of homes. Prices are capped at $650,000 in Auckland and Queenstown and $500,000 everywhere else.

Espiner began his interview by noting what has been achieved so far.

Twyford:   We absolutely accept that there is a housing crisis and we are committed now and in the long term to working through on a range of policies to tackle both the immediate unmet need for affordable housing –  decent housing – while also tackling the underlying structural problems that we’ve got  us into this mess.

We’ve found, Guyon, that in the first six months of the KiwiBuild project it’s been tougher than we expected to get the early numbers up …

Espiner:  Why is that?

Twyford:  Well, in the early couple of years of the KiwiBuild programme the intention was that what we call “the building-off-the plans initiative”, which is where we are partnering with private developers helping derisk those projects –  to incentivise them to build that affordable modest starter homes that the market basically hasn’t been delivering – for first home buyers – that’s been just a little bit tougher than we expected to get the early pickup.

Espiner:  Why? Why?

Twyford:  It’s a matter of incentivising developers to move off the existing business model that they have which is to get them maximum return on capital by building fewer more expensive homes and we are trying to get them to change that business model and build a greater volume of affordable homes – you know, the market is currently producing fewer than 5% of the new builds are in that bottom 25% of the price range.

That’s where first home buyers traditionally buy …

But Espiner was fixated with the target and relishing the prospect of the government failing to hit it.

Espiner: Okay. We’ll move on to affordability.  I just want to get this target, because you seem to be perhaps softening us for the fact that it might not hit the targets – you’ve got 1000 built by July this year.  That is the target, right? We are agreed on that?

Twyford:  That is our declared and published target, yeah.

Espiner:  And are you going to meet it, can you guarantee this morning that you will meet that target?

Twyford:  No, I can’t guarantee that.  I mean, I think it’s going to be tough to meet that target, and we are really focused at the moment on doing everything we can to refine and improve what we’re doing – the way that we’re working …

Espiner:  Hang on, though, hang on … so you are saying this morning you can’t guarantee you are going to meet the target?

Twyford:  No, it’s a target.  We’ve always aimed to meet that target and we are working flat out to do that.

Espiner:  So what do you think it’s going to be, Minister, by July?

Twyford:  I’m not going to give you a prediction right now – we are working on that right now. We’ve got several hundred…

Espiner:  Well what’s your new target – let’s put it that way? I mean, you’re talking targets, what’s your new target?

Actually, it’s Espiner who is talking targets.  Twyford – we are sure – would much rather talk about something else.

But he did answer the question.

Twyford:  We are not setting a new target – but look… we’ve got several hundred KiwiBuild homes under construction , we’ve got 4000 KiwiBuild homes under contract and another 10,000 that we are committing to  and the large-scale [unclear] projects  that we always intended would be the source of most of the KiwiBuild homes over years three, four and five and that’s why we are moving to set up an urban development agency – to  lead those large-scale  projects.  They will deliver much of the volume of KiwiBuild over the next   years…

We think we heard a sigh as Espiner interjected …

Espiner:  Okay, so you’ve abandoned the target for 1000 houses by July. ,,

Twyford:  No, we’re not, Guyon, we’re not…

Espiner:  Well, you have.  You’ve just abandoned it this morning. 

Twyford:  I’ve said it’s going to be  – we’re six months into this first year. It’s going to be tough  to meet that, but we are working as hard as we can …

The strong likelihood is that the target will be missed as comprehensively as …

Well, the Key government set a goal in 2012 of reducing reoffending by 25% by June 2017.  By May 2017 it had achieved a 4.5% reduction and  announced it would dump the target.

Justice Minister Amy Adams said the new aim was to reduce the number of serious crime victims by 10,000 by 2021, or about 2000 a year.

The previous goal aimed at 7500 fewer violent crimes a year.

She said 10,000 was a much more tangible number for people to understand, and it was not an admission the old target was unobtainable.

In that case – clearly – the original target was abandoned.

Twyford is sticking to his target while acknowledging the difficulty (some would say impossibility) of reaching it.

In July we will be able to judge how he has performed.  And if he misses by a huge margin, well, then the government’s critics will have cause to bray for his sacking.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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