News Worthy
15 February 2008 - No.237
8 key questions in the Year of the Rat
On 7 February 2008 the Lunar Year of the Rat commenced.
It is said that rats are leaders, pioneers and conquerors. They are charming, passionate, charismatic, practical and
hardworking.
Rat people are endowed with great leadership skills and are the most highly organized, meticulous, and systematic of the
twelve signs. Intelligent and cunning at the same time, rats are highly ambitious and strong-willed people who are keen
and unapologetic promoters of their own agendas, which often include money and power.
Here are eight key questions for the year:
- Why, after eight years of Labour, are we paying the second-highest interest rates in the developed world?
- Why, under Labour, is the gap between our wages, and wages in Australia and other parts of the world, getting bigger
and bigger?
- Why, under Labour, do we get a tax cut only in election year, when we really needed it years ago?
- Why can’t our children afford to buy their own home?
- Why do one in five children leave school with grossly inadequate literacy and numeracy skills?
- Why, when Labour claim they aspire to be carbon-neutral, do our greenhouse gas emissions continue to rise at an
alarming rate?
- Why hasn’t the health system improved when billions of extra dollars have been poured into it?
- Why is violent crime against innocent New Zealanders continuing to soar and why is Labour unable to do anything about
it?
The resumption of Parliament
The pundits speculate when the election will be held this year. The Parliamentary schedule of sittings runs up until 23
September.
There are rafts of competing views as to when the elections might be – it is possible to argue that the Government will
seek to cling to power for as long as possible hoping for change in the political climate.
A contrary argument is that a September election is quite possible because the minor parties who play a dominant role in
the MMP regime and support the present minority government will become more difficult to manage as they seek to
strengthen their respective brands.
The affordability of Housing
In the Prime Minister’s opening statement to Parliament the issue of housing affordability was said to be a “high
priority”.
New Zealand has historically celebrated high home ownership rates, yet today we are among the least affordable places in
the world to buy a home. The rapid deterioration in home affordability is a product of government policies of
restrictive planning driving up section prices, high interest rates, low net incomes and increased building compliance
costs.
The 2006 Census showed the largest drop ever in home ownership in New Zealand history.
Year / Average Section Price ($) / Average House Price ($) / Average Income ($) / Affordability ratio (years) / First Mortgage Interest Rate
1999 / 75083 / 166075 / 34340 / 4.8 / 7.24%
2007 / 163627 / 320458 / 45147 / 7.1 / 10.55%
Percentage / +118% / +93% / +31% / _-48% / +46%
According to the just-published, 4th Annual Demographia International Housing Affordability Survey, New Zealand now has
the highest-cost housing among the surveyed nations in relation to incomes as well as the highest interest rates.
Internationally, New Zealand is now among the least affordable places in the world to buy a home. Rents have also begun
to rise, placing many renting families under increasing financial pressure.
It is widely accepted that Government changes to the Resource Management and Building Act have had a significant
negative impact on housing costs. Development levies have trebled.
The Master Builders Federation has identified $30,000 per home in unnecessary compliance costs and Councils have noted a
trebling in compliance documentation. A comprehensive study of relative building costs between New Zealand and Australia
showed the greatest difference was the very high local and central government costs in New Zealand.
Political Quote of the Week
"Faced with the choice between changing one's mind and proving that there is no need to do so, almost everyone gets busy
on the proof." Galbraith's Law - John Kenneth Galbraith - Canadian-American economist (1908-2006)
Dr Richard Worth
National Party MP
ENDS