Auckland Council loses final say on freeing up land for housing

There is "a fair bit" of land banking in Auckland, Prime Minister John Key says - and the council will soon lose the final say on freeing up land.

Mr Key said land supply issues had been largely solved in Christchurch using the power of the Canterbury Earthquake Recovery Authority and commissioners.

The Government was not considering commissioners in Auckland, but Mr Key told Radio New Zealand the decision to free up land would no longer end with the council.

That was because the Government would soon release a national policy statement (NPS), possibly as soon as this week. It will require some councils to relax restrictions on where houses can be built.

"[A decision on land] will be one held by conditions set by the national policy statement" Mr Key said. "That's where the power of national policy statements come in."

The statement will include specific thresholds for growth, which will trigger a requirement to allocate more land for residential development.

Finance Minister Bill English had previously suggested that councils could be forced to act if the median house reached 10 times the median income.

Asked if the national policy statement would contain a house price to income ratio, Mr Key said it would, but he would not reveal more detail.

"Fundamentally, yes, there is a link. You'll have to see all those details, and there is a number of factors in there," he told Radio New Zealand.

There was a "fair bit" of land banking around Auckland, the Prime Minister said, and the special housing areas were only a temporary response.

He felt the debate would soon turn to who would pay for infrastructure to allow developments to go ahead -- one of the major obstacles to housing supply in Auckland.

The NPS will not require a law change.

The Government has previously tried to include urban development in the main principles of the Resource Management Act.

But it was repeatedly unable to get the support of its support partners, who were concerned that it would undermine environmental bottom lines.

That has prompted the Government to take an alternative route with an NPS, which does not require a Parliamentary majority to introduce.

The Labour Party recently said it would support the abolition of urban limits in Auckland.

Leader Andrew Little said the criticism levelled at Auckland Council in the past week from Mr Key and Mr English came after a Budget that delivered little in the way of solutions for the housing crisis.

"I think it is typical blame shifting and not taking responsibility for the problem that has appeared on their watch.

"They have clearly attempted to do things about the out-of-control housing market, but nothing has worked. They can't, having failed in various attempts to do something, then say it's all Auckland Council's fault."