Skip to content

The KiwiBuild Fiasco: How KiwiBuild fell down, and whether anything can be saved from the wreckage – #3 – An idea becomes an Aspiration without any contact with Reality

04/07/2019

Henry Cooke at Stuff – How KiwiBuild fell down, and whether anything can be saved from the wreckage– A detailed look at the fiasco from a journalist.

This is an excellent article, it allows readers to draw their own conclusions and nothing wrong with that.

This and other posts will explore the article and it’s ramifications

This is the third in a series – the first is here, and the second is here

This post looks at how the policy was conceived or perhaps more accurately misconceived.

THE BACKSEAT BRAINSTORM: 2012-2017

2012 was a tough year for the Labour Party. After nine years in Government and a sound defeat in 2011, the party was polling in the low 30s and had a serious discipline problem as backers of David Cunliffe attacked then-leader David Shearer from the Left. In such deep doldrums, nostalgia for earlier days ran high – not just for the Clark government but for the huge achievements of men like Michael Joseph Savage and Norman Kirk.

So Labour was desperate for something that sounded good and that grab the media spotlight and shore up David Shearer. So it was a case of ‘Never mind the quality, feel the width’.

So as we shall see – that led directly to the mess we see today.

At the conference in 2012, a big new policy would be ideal. Something to snatch the headlines away from leadership ructions, to put John Key on the backfoot. Senior MP and shadow housing minister Annette King had just the ticket.

King, who declined to comment for this story, had been in a car on the way to an event with Salvation Army head Campbell Roberts and Housing Foundation head Brian Donnelly in the months before the conference, chatting about the emerging problems in housing. Donnelly’s agency had a scheme where affordable homes were built and sold, and the capital immediately recycled to build more. King liked the idea.

So the policy was based on a casual conversation in a car.

“We said there was a supply problem, and there was a need for there to be an increase of supply of affordable entry-level housing. But the emphasis was on the affordable,” Roberts told Stuff.

“To tell you the truth, I was a bit concerned with the speed at which they grabbed it. I don’t think there was pretty much more than our conversation – which was in the car going to something – it was a not a sitdown meeting, and the next thing they were introducing it,” Roberts said.

Note Roberts comment. It makes clear what has become all too apparent, desperation does not lead to good policy.

As an idea good on King for taking hold of it, but it would seem that she took a concept, made it policy, but as far as I can see no analysis as to what was required was undertaken at that time. That as we shall see has been a key problem with this policy since inception. It was just taken as ‘The Big Idea’ to sell to the party and the electorate. In fact an unkind person might say that it exemplified the application of Goebbels concepts

Shearer introduced the policy to rapturous applause at the conference, but it didn’t stop most of the attention focusing on the ructions within the party.

So the policy did not even achieve in immediate political terms the saving of Shearer, but led to the catastrophe we see today.

King told a recent biography the original policy had been for 50,000 homes, but after taking a look at the huge amount of homes built in the 1970s it was decided it could be “cranked up” to 100,000  instead – in fact they even considered going higher. When the party was finally elected five years later, it would be happy it hadn’t.

Again, it seems that little if any concrete analysis was done. It was a political calculation.

This is reinforced by the following comment, quoting Roberts again:

Roberts said the 100,000 number immediately raised warning signs and he told Labour about it.

“Those numbers were just not sustainable. There wasn’t 100,000 people needing housing if you didn’t do anything about making them affordable.”

Oh dear

He wasn’t the only one raising his eyebrows. New Zealand Initiative economist Luke Malpass wrote a piece for Interest.co.nz wondering exactly how a construction sector where the top three companies had managed just 535 Auckland homes the year before could rev itself up to building 10,000.

So way back in 2012/2013 warning flags were being raised, but where were similar pieces in Stuff or NZ Herald. I assume that if there were some on Stuff, Henry Cooke would have referenced them as well.

It seems the spin worked. Goebbels again.

King soon handed over the housing portfolio to ambitious Aucklander Twyford, who took the policy and ran very hard with it.

Indeed, Twyford trumpeted the policy at every opportunity. as we see here, when he said

Workshops were held in 2013 to refine the policy so it would be “ready to roll when Labour takes office”.

Well that did not happen by any stretch of the imagination, except in the ego that is Twyford.

As the linked to press release says, Twyford stated

“We want KiwiBuild to be ready to roll when Labour takes office. We are grateful for the support from industry and their willingness to be part of a plan to make the dream of home ownership a reality for Kiwis.

and

Industry experts have today agreed to take part in three separate working groups to progress Labour’s KiwiBuild plan to help 100,000 families into affordable homes, says Labour’s Housing spokesperson Phil Twyford.

Well as we know now that did not happen.

Nor it seems did the involvement of industry experts lead to anything remotely like implementable policy. Again this smells like spin.

Then Henry Cooke recounts

Later in the year Cunliffe relaunched the policy at another party conference with the very 2013 angle that it would provide 10,000 homes in Christchurch over its first four years, and a lot of talk about how it would boost employment. This foresaw the ability for a big monster policy like KiwiBuild to become a “catch-all” for any problem in the housing sector or elsewhere.

Cunliffe was ever the opportunist and very prone to ignoring reality, much like Twyford.

National’s attacks on the policy never really changed. As he voted down a one-page member’s bill that sought to implement the policy in 2016, National MP Jono Naylor exclaimed “you cannot magically make houses happen”. But in 2017, as the election neared, National seemed to be feeling some heat, and announced that it would build 34,000 houses in Auckland.

National were not guilt free, but this point is not properly explored. Arguably there is much more to lay at National’s door.

Following the 2014 election, KiwiBuild survived the Andrew Little-led policy cleanup. It was recosted at $2b, the price of the houses boosted, and half of the houses would now be in Auckland, which was feeling the worst of the housing crisis. The private sector would be involved, and the house building would gradually “ramp up” over three years, with 15,000 being built over that period. But the policy’s core promise – 100,000 affordable homes in 10 years – remained rock solid right into the 2017 election, and right the way into Government.

Here however is the problem. Faulty analysis if there ever was any, plus as we see today an addiction to slogans and headlines rather than substance.

 

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: