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Finance Minister defends Labour's efforts to tackle housing crisis in combative interview with John Campbell

Finance Minister Grant Robertson defended Labour’s record on addressing the housing crisis, and denied making it the Reserve Bank’s problem, in a combative Breakfast interview with John Campbell today.

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The Finance Minister said the issues with the housing crisis were long-standing. Source: Breakfast

Robertson said it was possible for the Government to make the housing market more accessible while also protecting the value of the homes that people already own.

“There are speculators in our market and we need to crack down further on them, for most New Zealanders, the house they own is not just as asset, it’s the security in their lives, it’s actually really important to build the kind of communities that we want in New Zealand, that people have security and can put down roots,” Robertson said.

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“Encouraging and supporting people to buy a home is absolutely critical, equally for the people that are in those homes, that is their security as well.”

The Finance Minister was asked if Labour were terrified that homeowners would never vote for the party again if it oversaw a dip in house prices. The exchange played out as follows.

Campbell: Is that your political balancing act?

Robertson: I wouldn’t put it in those terms, for most New Zealanders, if they do own an asset, the asset they own is their house

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Campbell: Okay, so what you’re saying is you’re protecting the value of the asset, can you do that at the same time while getting more people into the market?

Robertson: You can, as long as we don’t have unsustainable house price rises like we’ve seen in the last few months.

“I’m not defending house prices, particularly of what we saw in the later part of last year, that’s why we’re moving on this, but I wouldn’t put it in terms you’ve put it in of a political judgement, it is actually a judgement on how New Zealanders get security in their lives, I want more people to have,” Robertson said.

Campbell asked Robertson if the criticisms he had levelled at the National Government early in 2017 over their housing policies were still applicable to this Government.

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The exchange played out as follows:

Robertson: Look, we’ve made huge efforts over the last three years to increase the amount of housing supply.

Campbell: Have you? What are the huge efforts? Sorry minister, what are the huge efforts? Huge is a big word.

Robertson: I’m just trying to answer that John, the bit that the Government controls, which is the building of state houses, public houses, we’ve actually seen more of that than any Government since the 1970s, we’re on track with the extra money we’ve put into build around 18,000 state houses over the next few years.

John Campbell interviews Grant Robertson. Source: Breakfast

Campbell: To build from scratch? When you say to build 18,000 some of this is existing stock, so it’s not increasing stock that you’re inferring.

Robertson said there were two things the Government was trying to do in the area of public housing.

“One of those is obviously add to the stock, the other is the recognition that, you could equally have me or [Housing] Minister [Megan] Woods on, and we could talk about the state house waiting list where we’ve said we actually want to know who needs housing, or better housing than they’ve got,” he said.

“We do have to get a balance there of bringing more properties to state housing stock

Yesterday, Robertson announced that the Reserve Bank is now required to consider the impact on housing when making monetary and financial policy decisions.

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The Finance Minister said it was possible for the Reserve Bank to help tackle the housing crisis with its policy, as well complete its primary objectives of controlling inflation and keeping Kiwis in jobs.

“Yes, those first two objectives are their primary objectives, in working towards those, they have to take into account things like the exchange rate and the overall stability of the economy, now we’re saying well do this for house prices as well,” Robertson said.

“We’ve been very clear that all parts of governments have responsibility here, we’ve obviously had a range of initiatives that we’ve rolled out over the last term, significant ones coming in how we increase the supply of houses but also how we shift demand so that first home buyers and renters are getting a fairer go.”

“This is just about making sure the Reserve Bank is very clear that taking house prices into consideration when they’re making their decisions, they’re just one part of the apparatus but it’s good to get clear what their role is.”