Source: New Zealand Government
Good afternoon, everyone.
I’d like to thank Denise for the warm welcome and Leonie, and the rest of Property Council NZ for inviting me to speak.
It’s been about six months since I spoke to you at The Property Conference in Queenstown –
I’m disappointed to see there is no pool this time!
Since September last year, we have seen strong year-on-year growth for building consents in each month.
For instance, when it comes to residential buildings consents grew:
- 27% in the year to September 2025
- 24% in the year to October 2025
- 13% in the year to November 2025
- 26% in the year to December 2025
- 15% in the year to January 2026
Today I’ll run through where we are at on RMA reform, with a focus on housing and property, then touch on Development Levies.
I’m also very excited to give you all a sneak peek into initial findings from an economic analysis I commissioned into the cost of viewshafts in Auckland.
Then I’m happy to answer any question you guys have.
Context
But before I get into it, I want to briefly touch on the context we are operating in. Over the last month, global events and uncertainty have impacted New Zealand’s economic recovery.
The conflict in the Middle East, and its resulting fallout is hurting all kiwis, particularly with higher fuel prices at the pump.
This has exposed an uncomfortable reality for kiwis –
Not only do we face systemic, decades-in-the-making challenges like low productivity and an infrastructure deficit – we also face significant and more frequent shocks such as extreme weather events and offshore conflicts.
At the same time, Fitch recently put our AA+ credit rating on a negative outlook.
Currently, the interest bill on Government debt is $8.9 billion per annum and rising. In Wellington I’d say that’s six Transmission Gully’s a year on interest payments alone.
If New Zealand’s credit rating was downgraded and that led to higher bond yields, then our interest payments would go up even more.
Taken together, we effectively have triplet headwinds (1) long-standing systemic economic issues, (2) exposure to shocks, and (3) high debt.
While we don’t have the power to declare peace in the Middle East, we can and must control how we respond.
Support for hardworking families
To start, we have moved quickly to provide extra support for low-to-middle-income working families.
From 7 April, about 143,000 working families with children will get an extra $50 a week through a boost to the in-work tax credit. The boost will also expand eligibility to around 14,000 additional working families.
The increase will be temporary, lasting for one year or until the price of 91 octane petrol drops below $3 a litre for four consecutive weeks.
This boost will deliver support to working families who are under significant cost-of-living pressure, without making inflation worse or further driving up Government debt as this $373m initiative is being paid for out of Budget 2026 operating allowances.
The COVID-19 Inquiry stressed that spending in response to crises should be timely, targeted, and temporary.
That’s what we’re doing.
The previous Government responded to COVID-19 through profligate, irresponsible spending – racking up debt. It’s clear some people have not learned from this and have called for this Government to make the same mistakes. But we won’t.
Throwing the kitchen sink at every event that happens is a recipe for fiscal disaster.
While it may sound simple and appealing, simply borrowing more could lead to a self-reinforcing “vicious cycle” where debt servicing takes up a large (and growing) share of government revenue, forcing increased taxes and/or cuts to public services and infrastructure to pay for that debt, which in turn reduces long-term economic growth, which then puts downward pressure on Government revenue, making the debt even less manageable.
It is naive at best and economically-illiterate at worst to pretend that New Zealand can afford to run structural deficits.
The Coalition Government understands New Zealand’s fiscal reality, and we know we cannot live beyond our means in the long run.
We are committed to protecting people’s living standards, which depends on strong fiscal discipline. We also know that sometimes, extra, targeted support is needed.
We can do both.
Fuel plan
Right now, we know the conflict in the middle east is causing concerns across the country and across the world about supply of fuel.
As you know, the Government has been keeping New Zealanders informed about our fuel supply situation.
We have sufficient stocks for now, and we are working hard across diplomatic, commercial, and industry channels to ensure that remains the case.
But this situation is also a reminder of something we already knew – New Zealand is exposed to international fuel markets in ways that carry real risk.
Around half our fuel comes from South Korea and nearly a third from Singapore.
When global supply chains are disrupted, as they are now, that exposure becomes very tangible for families and businesses who feel the pain at the pump.
We know higher fuel prices are hitting families and businesses hard. That’s why we put in place the targeted cost-of-living relief for low- and middle-income families I mentioned before.
But maintaining fuel supply is the most important thing we can do to protect Kiwis from the worst-case scenarios.
Later this week, Nicola Willis – who is in charge of our response as a Government – will provide an update on the National Fuel Plan along with further detail around how we see some of the levels playing out in practice.
We all hope things improve quickly – but as the Prime Minister has said, hope is not a plan.
So, we’re doing the hard yards now to ensure New Zealand has a really solid fuel plan that gets us through whatever the international situation throws at us in the coming months.
Fixing the basics and building the future
A key part of becoming more resilient to shocks is having strong institutions, functional regulation, and a high-performing economy.
As Paul Krugman observed –
“Productivity isn’t everything, but in the long run it is almost everything.”
This Government is supporting growth through policies like Investment Boost and Fast-Track, getting on with building billions in infrastructure, and signing up to more free trade agreements.
We are also tackling long-standing systemic issues that have accumulated and festered for 20 to 30 years.
I’m thinking of things of things like RMA reform, infrastructure funding and financing reform, sorting the Holidays Act, reversing wealth destructive earthquake prone building legislation, opening up competition in building materials, and more.
I strongly believe that if we get these things right, maintain fiscal discipline, and keep momentum going, the 2030s will be New Zealand’s decade.
RMA reform
The single biggest thing this Government is doing to unlock New Zealand’s economy is RMA reform.
Our new planning system will make it significantly easier to build the homes New Zealand needs.
The Resource Management Act 1991 is the root cause of so many of our challenges.
It has been a handbrake on growth and opportunity. It is directly responsible for New Zealand’s housing crisis – despite us having a land mass comparable to the United Kingdom but just five million people.
And it’s also allowed council planners to delay the delivery of social housing because the “grass colour is too similar to the concrete colour”. Or because “the colour of pipes on the house is too contrasted to the colour of the house itself”. Or because council was concerned there was no signage so people could find their house.
These are all real examples from Kainga Ora.
I am sure you have a laundry list of your own examples. But these are example of the past!
Our new planning system will radically change how we approach development, while still protecting the environment.
A specific goal of the new Planning Bill is for the system to enable competitive urban land markets by making land available to meet current and expected demand for business and residential use and development.
National Direction will follow, including the establishment of housing growth targets, rules making it easier for cities to expand outwards, requirements to enable greater mixed-use zoning, and prohibitions on minimum floor area and balcony requirements.
My ambition is to deliver the most significant pro-housing reforms in a generation. In practice, this will mean:
Everyone will be able to do more without needing council consent. The new system won’t control for things like the layout of your house, balconies, or private outdoor space – giving people more freedom to use their land how they see fit.
Developers will be able to use the same designs anywhere in the country. Right now, New Zealand has more than 1,100 different zones, each with its own set of rules. Under the new system, we’ll reduce that complexity by using standardising zones nationwide and applying consistent rules for key things like building height, site coverage, and daylight access. No more juggling different rules for Upper Hutt versus Lower Hutt, or Christchurch versus Selwyn.
Getting a consent will be simpler. If you do need one, the process will be simpler and cheaper. Rules will be clear, in more cases only affected people can take part in the consent process, and a new planning tribunal will help resolve disputes at low cost.
Land will be released faster through a mechanism that removes the need for extra plan changes or long consultations where the land has been previously identified as suitable for development.
And developers will have greater certainty to invest. Long-term spatial plans will show where new housing and infrastructure will go, so developers can plan projects and invest with confidence.
All of these changes – along with others – will finally give New Zealand the planning settings it needs to grow.
Development Levies
But as all of you here know, liberalising land markets and removing red tape is – on its own – not enough.
We also need a flexible infrastructure funding and financing system to match our new flexible planning system.
We have heard from the sector, and from the Property Council in-particular that we must get infrastructure funding and financing right – I agree.
So, we are making a suite of changes to the toolkit including:
- Replacing Development Contributions (DCs) with a Development Levy system, where growth pays for growth
- Establishing independent regulatory oversight of these Levies to ensure charges are fair and appropriate
- Amending the IFF Act to make it easier to use and to broaden the providers that can use it
I want to go over where we are at on Development Levies.
Late last year, we released an exposure draft on development levies to get the sector’s feedback.
I’d like to thank Property Council for their submission. I’m told my officials and office had an initial workshop with Property Council on their submission, and I’ll be meeting with them next week to continue the conversation.
It’s clear the exposure draft doesn’t have everything right just yet, but that’s why we went out for consultation early – so we can take your feedback on board. For me, it’s vital that the sector has trust in the new system.
We have heard your calls for more transparency on how much councils collect from developers for growth infrastructure, and how they use those funds.
That is why we are getting the independent Commerce Commission to regulate Development Levies – with a focus on strong information disclosure requirements.
My intention is also for the Commerce Commission to set the standardised methodology for calculating development levies. I can promise both councils and the sector that there will be consultation on this methodology.
The Commission’s role will focus on ensuring levies are transparent, fair, and deliver value for communities, while safeguarding against anti-competitive behaviour.
I think we can all agree that the current regime is not working.
Our new Development Levies system, and our wider infrastructure funding and financing toolkit aims to do two things: be flexible to match our new flexible planning system, and strike a balance and be designed in a way where growth pays for growth in a fair and appropriate way.
I’m confident we can get there.
We will continue to work with developers, councils, and groups like the Property Council to make sure we do.
Once the legislation for development levies passes in 2027, councils will have time to establish their new levy policies.
We expect the first councils to begin charging development levies in 2028/2029 – about the same time the new planning system comes in.
Now, this alignment of “turning on” development levies and the new planning system at the same time is intentional and important – particularly when it comes to preparing new spatial plans and land-use plans.
We know this shift may increase charges for some developers, particularly those who’ve already bought land.
That’s why the exposure draft proposes a three‑year phase‑in for any price increases where councils move early.
We’re looking closely at feedback on these transition settings to make sure the shift is manageable.
There will also be further opportunities to provide feedback through the select committee process.
We are committed to getting this right – it’s a once in a generation change to ensure we fund growth properly.
I look forward to meeting with the Property Council on Development Levies next week.
Viewshafts and Auckland CBD
Now, to finish, I’ll briefly touch on the work Government is doing on Auckland City CBD and give you a sneak peek of some economic analysis I commissioned on viewshafts.
I don’t want to get into the whole PC120, PC78, MDRS, NPS-UD acronym soup speal so I will just say this:
The Government believes there is significant unrealised potential in the CBD. Existing provisions, such as setback requirements, tower dimension controls, and height limits, constrain development and should be revisited.
Enabling more growth in the city centre will unlock productivity and increase the benefits of CRL even further.
However, for largely unfathomable RMA legal reasons, the City Centre Zone is not included in PC120 work, and the Council does not have a simple mechanism to unlock this potential.
Therefore, Cabinet has agreed that I will start an investigation into these planning provisions that are holding back Auckland’s city centre, with a view to making regulations under the RMA – similar to what we have just announced for Eden Park.
This investigation will contribute to the Auckland we are trying to build which is an international, world-class city.
*Now, on viewshafts – I’m told the Auckland Unitary Plan designates over 80 protective viewshaft cones and 10 height sensitive areas that impose building height limits on affected properties.
While the cultural and amenity rationale for these protections is well established, the height restrictions also impose a substantial economic cost on Auckland which is less understood.
Work done by Geoff Cooper in 2018 found that the E10 viewshaft (which protects views of Mount Eden for southbound motorists approaching the Harbour Bridge around the Onewa onramp) was limiting development at a cost of $1.4 billion.
This is material, and I wanted to get a better and more up to date understanding of these costs. So, last year I commissioned a report on all 80 volcanic viewshafts.
The report is yet to be finalised, and numbers could still change, but I wanted to share a statistic which I though was compelling, and a good comparison to work already done by Geoff Cooper.
The draft report indicates that, based on current zoning patterns across Auckland, the harbour bridge viewshafts (E10 and E16) are limiting development in the central city at a cost of $4 billion.
In other words, there is $4 billion of value locked up in just these two viewshafts.
In addition to this, the draft analysis shows that viewshafts across the central isthmus are depressing disposable incomes in Auckland by an average of $2,500 per household per year due to transport and location-based inefficiencies.
I am looking forward to receiving the final report shortly and will publish it in the next month or two.
Conclusion
I’d like to thank the Property Council for inviting me to speak.
Changes to our planning and housing systems are fundamental to this Government’s ambition to create a more prosperous future for New Zealand.
Now it is up to all of us to do the hard work required to turn this ambition into reality.
Thank you. I look forward to your questions.