Wednesday, 1 November 2017

The ingenious Phil Twyford

The new minister for housing and transport has found a way to pay the unaffordable bill for Auckland's new public transport infrastructure, and that's to help make Auckland housing even more unaffordable.

What could be more ingenious!

He'd already signalled that Labour's faithful promise to voters neither to raise taxes nor to introduce a capital gains tax was going to constrain him -- he'd already announced plans to get around that simply by raising the 'bright line' period for paying National's own tax lie (the 'capital-tax-in-drag' introduced just because lying governments can) from two years out to five. Because there's no politician like a money-hungry politician, is there.

And with Auckland's council having already borrowed way beyond what it can reasonably repay (in political-speak this is known as the Council being "up against its debt limits," as the new minister is quick to acknowledge) and the new Government having no spare cash to throw around after funding all of their promises plus those of Winston and James, Twyford now has the job of filling the $6 billion black hole in Auckland's transport bill that Len Brown and Phil Goff have helped dig.

But he has "big plans" to do that, he tells faithful recorder Bernard Hickey. "Big plans" to fill the black hole. "Big plans to change the way Auckland's multi-billion dollar light rail projects will be paid for," he says. Which means: big plans about who he is going to soak to pay for all the monuments, of which "light rail" is only the most ill-defined. And the answer in four words, dear reader, is: "motorists and property developers."

Now that smokers have slunk away quietly, motorists are the new lepers. Hitting them with new fuel taxes is only the starting point. He has an endless stream of new ideas about how to soak anyone who drives a car. Lock up your wallet now, while you can.

He also plans to sock property developers, hinting he will hit them with a new super-rates bill on developments. This appears to be in addition to "targeted rates" to repay infrastructure bonds (and in addition to the almost already crippling rates rises that Mayors Len and Phil have been exacting to pay for their grandomania and Rodney Hide's super-sized stuff-up.).

At this stage these are only just hints about his big plans. But any added tax burden on the developers who build Auckland's houses will only make it even more difficult for developers to make a margin on building those houses, making it more likely rather than less that lots more affordable housing for would-be first-home buyers will ever easily be built. (Every single change from every single housing minister has made this hope less likely rather than more, so he does at least follow in a grand tradition.)

But motorists, vendors, and property developers and their erstwhile first home-customers will not be left to suffer alone. Mum and dad and several kids already happily home-owning anywhere near any part of Auckland's expensive upcoming light rail- and rapid transit-building orgy will also be hit with something special too, in the shape of extra special "targeted rates" -- Mr Twyford's favourite new phrase, it seems -- all the better for him "to capture the value uplift in property prices" mum and dad might otherwise enjoy.

What he may miss out on with his 5-year capital gains levy on mum and dad if they don't sell their house within that time frame, he'll claw back from them anyway with his "targeted rates" if they stay put.

And if they don't enjoy any value uplift at all? Fear not. They and everyone else will still receive their share of the disingenuous Mr Twyford's $6 billion bill anyway.




  1. The one good thing that Labour campaigned on was the removal of the metropolitan urban limit. It is the one thing that Twyford has gone silent on since getting the keys to the Beehive.


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