National: Reserve Bank not happy with Government’s motive on Housing Crisis

The Reserve Bank of New Zealand is not happy with the Government's motive on the recent Housing Crisis, which has been a complete disaster according to National.

Confirmation in writing from the Reserve bank states that National has been saying for a while now that the Government lacks a clear direction when it comings to a housing emergency.

National's Shadow Treasurer Andrew Bayly says that it was clear from the letter that the Government just is not doing enough.

“It’s clear from the Reserve Bank’s letter that the Government is not doing enough in terms of its own responsibility to improve the housing supply,” says Mr Bayly.

“This includes a whole range of measures: amending the RMA quickly, ensuring an adequate supply of land, addressing the issue of increasing construction costs and making sure building regulations are fit for purpose.”

“In essence, the Reserve Bank is recommending a ‘Whole of Government’ approach by establishing a new agency to address these issues.”

Mr Bayly says that there needs to be a more vigorous response from the Government.

“The Reserve Bank also recommended the Finance Minister amend its financial policy remit by taking advantage of Section 68B of the Reserve Bank Act to provide direct guidance to the bank’s monetary policy committee. This is exactly the approach National recommended back in November,” says Mr Bayly.

“The Government should be leading our approach to addressing New Zealand’s housing emergency, but it isn’t.”

Trading banks have been encouraged to provide lending to more productive parts of the economy, such as businesses, agriculture, and property developments.

“The Reserve Bank has also confirmed the Government has far greater tools at its disposal for addressing house price inflation than it does but chooses not to use them,” concluded Mr Bayly.

Image: SUPPLIED/Shutterstock.com