Abstract
Increasingly, planning for housing development involves political conflict between local government planning practices, based on urban sustainability and housing intensification, and central government housing policies, centred on land supply and housing affordability. This paper examines a key historical moment in the politics of housing supply and planning in New Zealand. Drawing upon a discourse analysis of a range of housing policy documents and urban plans, this paper traces the dynamic of local and central government negotiations and conflict arising from the development of Auckland’s spatial plan, the development of the Auckland Housing Accord (a central and local government agreement to fast-track planning permission for new housing) and the implementation of the Housing Accords and Special Housing Areas Act. The paper focuses on the manner in which certain policy knowledge is prioritised and applied in the construction of affordable housing policies and how this process, which is presented as objective evidence-based policy formation, is inherently political. It is argued that the legislation supporting housing accords alters central/local government power relations and represents a challenge to the existing planning system.
Introduction
Increasingly, housing affordability represents a problem for both central and local government. In recent years the twin problems of ‘asset bubbles’ and housing affordability have exercised the minds of central government policy-makers around the world (Bramley, 2013). While mortgage deregulation facilitated a significant boost in consumer demand for housing, policy-makers have also recognised the role of housing supply and the planning system (Ball, 2011; Ball et al., 2009; Barker, 2004) on house prices. In the UK context, the Barker Report, on the supply of housing and housing affordability issues, argued that ‘central to achieving change is the recommendation to allocate more land for development’ (Barker, 2004: 6). Significantly, as some have emphasised land supply (Bramley, 2013), there has been increased attention given to the role of planning in providing affordable housing (Austin et al., 2014). In this context, the differentiated roles of central and local government policies, in shaping residential land supply, have assumed increased significance.
This paper examines the nature of policy development and the evolving political dynamics around housing supply issues in Auckland, New Zealand’s largest and most expensive housing market. In the context of rapidly rising house prices, and the creation of a spatial plan designed to guide Auckland’s urban development for the next 30 years, political differences between central and local government have emerged in shaping the appropriate policy responses to housing affordability issues. Whereas central government has emphasised the need to release more land for residential development, especially on the urban periphery, the Auckland Council has promoted urban intensification as a means to create the ‘world’s most liveable city’ (Auckland Council, 2012: 2). This paper traces the emerging political construction of land supply practices within Auckland through an analysis of local and central government policy documents centred on the creation of the Auckland ‘Housing Accord’ and the introduction of the Housing Accords and Special Housing Areas Act (2013) (HASHAA). The Housing Accord is an agreement between the government and the Auckland Council that provides for the ‘fast-tracking’ of planning permission for new residential development. While at one level the Accord represents a joint commitment to increasing housing supply, it also highlights an emerging division in central/local government approaches to the release of land and the response to housing affordability issues. This emerging divergence is evident in the legislation that gives force to the accord. The HASHAA provides the Minister of Housing the power to override local government planning regulations and to directly grant planning permission for residential developments and thus represents a challenge to the nature of local planning.
This paper specifically addresses the nature of political conflict (see Jacobs and Manzi, 2013, 2014) in housing policy formation in New Zealand. Within neoliberal governance regimes that advocate evidence-based policy (EBP), appealing to an appropriate evidence base seems one way to resolve the inherent conflict between calls for urban intensification on the one hand, and greenfield development on the other. However, in this paper I argue that the actual policy processes involved are necessarily political and involve the privileging of certain knowledge and practices. I am particularly interested in examining the rationale and dynamic of central government policy formation and how it has positioned land use planning practice in Auckland as the primary cause of housing unaffordability. Focusing on a particular historical moment, centred on the creation of a Housing Accord between the government and the Auckland Council, affords a lens through which it is possible to examine the nature of conflict underpinning policy formation (see Jacobs and Manzi, 2013, 2014).
The remainder of the paper is in five parts. First, I review the emerging literature on ‘mobile policy’ processes and the politics of housing policy formation. This literature uncovers the dynamics of policy transfer under neoliberalism and challenges the perceived political neutrality of EBP practices. In order to explore the nature of policy creation relevant to housing affordability, I provide a brief review of different literatures on urban planning, housing affordability and land supply. In this review I am not concerned with the relative merits of ‘urban intensification policies’, ‘inclusionary housing’ or ‘land supply’ models per se, rather I am interested in the ways that these ideas are incorporated into policy and have the potential to generate political conflict. Second, I discuss the methods employed in the study and identify the range and nature of texts (both formative and final policy documents) that were analysed. Third, I provide contextual data on the Auckland housing market and the nature of urban planning in the region. Fourth, drawing on a discourse analysis of policy texts (official advice, reports, debates, submissions and legislation) I provide an extended analysis of emerging local and central government conflict and political negotiation around land supply and housing issues in Auckland. In this section I chart emerging differences in central and local government responses to housing affordability issues. Significantly, these different responses draw upon discrete academic literatures or evidence. In the final section I offer some conclusions on the Auckland Housing Accord and how it contains the potential for ongoing power struggles between the Auckland Council and central government. I also reflect on how the rising significance of policy-making around housing affordability within central government in New Zealand represents a significant challenge to existing planning practices.
The politics of evidence-based policy
Urban and housing policy formation under neoliberalism has placed considerable emphasis on EBP (Jacobs and Manzi, 2013), the identification of best practice and the adoption of appropriate metrics or governance technologies (McCann and Ward, 2011; Murphy, 2014; Prince, 2012). While urban and housing policies are subject to elements of path dependencies (see Malpass, 2011), increasingly international policy transfers are shaping the manner in which both central and local governments policies are being formulated and implemented (Gurran et al., 2014). Borrowing policy from elsewhere is, from one perspective, a rational way to promote efficiencies but there are dangers involved in importing policies that have evolved within a specific territorial and institutional context, and transplanting these (unmodified) into new territorial contexts. This de-territorialisation and reterritorialisation of policy is taking place within new circuits of ‘fast policy flows’ mediated by international consultancies and policy think-tanks (Prince, 2012). Focusing on policy transfer under neoliberalism, Prince (2012: 191) argues: … the increasingly transnational character of policy-making processes … is achieved through the construction of ‘fast policy’ circuits in which various crises in different places are latched onto, exaggerated or invented by actors associated with particular think-tanks, consultancies and international institutions: crises for which their answer is always some variant of neoliberal policy.
Faced with a crisis (such as housing affordability), policy-makers draw on different policy evidence or knowledge to inform their decision making. In contexts where EBP is emphasised, one would expect policy-makers to rely on peer-reviewed research. However, recent research on the use, or non-use, of academic research in housing policy highlights the existence of a ‘knowledge hierarchy’ (Parsell et al., 2014). Parsell et al. (2014: 84) found that ‘intuition and direct personal experience were afforded more credibility – viewed as more “trustworthy”– by relevant stakeholders than peer-reviewed research’. Moreover, Pawson and Hulse (2011: 129–130) found that notwithstanding ‘… policymakers’ stated adherence to the principles of “evidence-based” decision making, other factors remain important’. Clearly policy development and policy transfer involves a complex appropriation of peer-reviewed evidence and more intuitive processes. Moreover, even when policy is based on peer-reviewed research there is a potential for conflicting positions to arise.
Jacobs and Manzi (2013) have recently called for a reorientation of housing policy research to address issues of policy development that have remained hitherto unexamined. They argue that the shift to EBP practices in housing policy in the UK appeals to the notion of technical rationality and is presented as politically neutral and free of special interest group influences. However, they maintain that these claims of neutrality hide the underlying ideologies at work in policy development. They state that ‘whilst housing policy makers continue to promote EBP to justify decision making, the choices they pursue are best explained by factors largely unrelated to “evidence”’ (Jacobs and Manzi, 2013: 1). They advocate for research that investigates the conflicts within policy settings and that explicitly addresses ‘the capacity of interest groupings and agents to define policy-making in ways that concord with their interests’ (2013: 10). Arguably these agents can, and do, include particular political parties that have distinct understandings and interpretations of economic and social processes. Moreover, policy-makers at both central and local government levels are key stakeholders in policy formation.
Jacobs and Manzi’s (2013, 2014) call to investigate conflict in policy formation is particularly pertinent in relation to housing affordability and land supply issues. Adams (2011) maintains that planning for housing development is an inherently ‘wicked’ problem and he argues ‘that the inherent controversy around housing land supply is not essentially a clash of techniques but rather of values and interests’ (2011: 953). While policy-makers might wish to reduce housing affordability problems to a single cause, Adams argues that it is unclear ‘whether the problem is really about land shortages, low rates of production or house price inflation, or some combination of these three’ (Adams, 2011: 958).
In advocating and justifying policy initiatives that address housing affordability, both central and local governments draw on discrete and often competing research frameworks. Since the 1970s local government policy-makers, focusing on ideas of urban sustainability and urban intensification (Rydin, 2010, 2011) have tended to view increased housing mix and inclusionary housing as appropriate measures for addressing housing affordability. In contrast, employing certain readings of mainstream economics (Cheshire, 2008), central government policy-makers are increasingly positioning land supply at the centre of housing affordability debates. Significantly, there has been an international trend for governments to construct planning constraints on housing supply as the major contributor to housing affordability issues (Gurran et al., 2014).
In order to frame the analysis of housing policy conflicts in New Zealand it is appropriate to sketch some key elements of these different perspectives on housing affordability. Taking cognisance of traditional planning concerns around planning for future demographic change (Bramley, 2013) and aligning this with a broader desire to pursue a more sustainable urban form (Rydin, 2010, 2011), planners in England, the USA and New Zealand have increasingly addressed housing affordability issues through the promotion of increased housing mix, urban regeneration (Adams et al., 2001) and inclusionary planning/housing policies (Mallach and Calavita, 2010; Monk, 2010).
Inclusionary housing is one planning response to housing affordability and involves a regulatory or legal process ‘that requires or provides incentives to, private developers to incorporate affordable or social housing as part of market driven developments’ (Calavita and Mallach, 2010: 1). While inclusionary housing policies have been implemented in a number of countries, the specific nature of these schemes reflect the wider planning, economic and political contexts in which they are embedded. For example, the history of inclusionary zoning in the USA is characterised by a variety of different, locally based, schemes (see Calavita and Mallach, 2010). In contrast, the inclusionary housing system in England has developed within a national regulatory system in which development rights have been nationalised. Significantly, inclusionary housing has become the major contributor to affordable housing provision in England (Monk, 2010). Importantly, notwithstanding the highly differentiated planning contexts and the historical specificities that have shaped inclusionary housing policies at national/local levels, the adoption of inclusionary housing policies clearly positions urban planning as having a potential role to play in addressing housing affordability issues. Moreover, it is this literature, on the benefits of planning and the role of inclusionary housing, that circulates within local government policy circuits at an international level (cf. McCann, 2011; Prince, 2012). Indeed, Austin et al. (2014) show that, despite major differences in national planning regimes, ideas around inclusionary housing have migrated internationally.
In contrast to the inclusionary housing literature, Gibb (2013: 63–64) argues that policy prescriptions drawn from mainstream economic analysis maintain that ‘the results of the planning system … are higher house and land prices, cramming, unaffordability and other problems associated with market distortions’. In England the limited supply response to rapid house price inflation in the early 2000s crystallised attention on the role of planning (Bramley, 2013). Reflecting on the Barker Report, Cheshire (2008) offers a pessimistic analysis of the impact of planning restrictions on land supply and housing affordability. He argues that a planning system that constricts land supply will mean that ‘average real house prices will continue to trend upwards’ (Cheshire, 2008: 57).
From an EBP perspective (Jacobs and Manzi, 2013) the clash between the ‘urban sustainability/intensification/inclusionary housing’ literatures and the ‘land supply/house prices’ literatures is problematic. In negotiating and reconciling these competing claims, policy-makers are likely to resort to traditional practices or advance singular ‘quick-fix’ solutions. In this paper I examine the manner in which central and local government policies aimed at addressing Auckland’s housing affordability problems are evolving and have incorporated different perspectives and approaches into the policy-making process.
I am particularly interested in examining the rationale and dynamic of central government policy formation and how it has positioned land use planning practice as the primary cause of housing unaffordability. Consequently, this paper focuses on the various policy logics and practices that were mobilised at the time that the Housing Accord was announced and the HASHAA was introduced. While the legislative reforms discussed in this paper will have significant material impacts on Auckland’s future urban form, the focus of this paper is not the success or failure of specific housing developments but rather the nature of conflict surrounding policy development and urban planning (Jacobs and Manzi, 2013).
Methodology
In order to examine policy conflict, this paper employs a qualitative interpretative discourse analysis (Gurran and Phibbs, 2013) of key policy and planning documents. Discourse analysis is a well-established methodology that has long been employed in housing, policy and urban studies (Gurran and Phibbs, 2013; Hastings, 2000; Jacobs, 2004, 2006; Lees, 2004; McCann, 2011; Urban Studies, 1999). Drawing on different theoretical positions (see Jacobs, 2006; Lees, 2004) discourse analysis has been used as a ‘methodology to understand the urban policy implementation process’ (Jacobs, 2006: 39) and the nature of policy conflict. Within housing research considerable attention has been placed on the critical examination of legislation and housing outcomes. In this study I extend the traditional concern for analysing legislation and policy documents (see Hastings, 2000; Jacobs, 2006) by including an analysis of a wider set of formative documents. To examine the logic propelling central government policy formation, a variety of texts including published cabinet papers and minutes, policy advice from the Ministry of Business, Innovation and Employment (MBIE), draft legislation and parliamentary debates were analysed. I also examine public statements made by senior government members and reported in the media. To address local government perspectives, key Council planning documents (including the Spatial Plan and the Draft and Proposed Unitary plans) were analysed paying particular attention to provisions relating to the release of residential land supply and proposals relating to inclusionary housing. The analysis focused on discursive practices, and considered the ‘context in which policy statements are made … [and]… their links to other debates and literatures’ (Lees, 2004: 104).
The full range of documents analysed in this study is set out in Table 1 and in total amounted to over 7000 pages of text. At a broad level these texts are categorised as formative and final documents. This categorisation was a simple logical device to distinguish the final key policy documents (the HASHAA and the Auckland Accord) from a range of formative documents that informed central and local government policy-making. It should be noted that the Auckland Plan and Unitary Plans are, at one level, final complete policy documents but, given that they were subject to public consultation, they are also formative. Moreover, these documents informed the Council’s response to the legislation and the Auckland Accord.
Formative and final policy texts analysed.
In line with Jacobs and Manzi’s (2013) call for attention to be focused on conflict in policy formation, the textual analysis focused on the manner in which central and local government agendas were presented and supported by reference to key ideas, practices, evidence or literatures. The analysis offered insights into the underlying rationales of key actors driving the accord process and the nature of conflict between central and local government perspectives on the causes of, and solutions to, housing affordability problems. In order to explore how policies have emerged it is first necessary to place Auckland’s housing situation in context.
House prices, home ownership and the Auckland metropolitan urban limit (MUL)
House prices in New Zealand increased by 80% in real terms between 2002 and 2008 (House Prices Unit, 2008; Murphy, 2011). In the wake of the global financial crisis (GFC), nominal house prices declined by 10% in 2008 but have since trended upwards, especially in Auckland. In the year to September 2014, nominal house prices rose by 6.4% nationally and 10.3% in Auckland (QV.co.nz, 2014a). Fuelling a new ‘housing boom’ discourse, nominal house prices in Auckland in October 2014 were 33.8% above the 2007 pre-GFC peak (14.6% in real terms) (QV.co.nz, 2014a) and the average house price in Auckland was NZ$731,302, or 51% above the national average house price of NZ$481,497 (QV.co.nz, 2014b). Significantly, in terms of two key measures of housing affordability relied upon by government agencies (see Murphy, 2014) Auckland remained the least affordable housing market in the country. Consistently ranked as ‘severely unaffordable’ in the Annual Demographia International Housing Affordability Survey, Auckland’s median house price to median household income ratio rose from 6.9 in 2007 to 8.0 in 2013 and Auckland was ranked less affordable than London (median multiple 7.3) (Demographia, 2014). Notwithstanding the limitations of this measure (Murphy, 2014), the New Zealand government follows Demographia’s methodology and defines housing markets with a median multiple in excess of 5.1 as severely unaffordable. In addition, the Roost Home Loan Affordability series, which measures the capacity of a standard household to service a mortgage, also deteriorated. In August 2014, this series indicated that it took 95.9% of a medium income to pay the mortgage on a median priced house in Auckland. While this figure was less than the market peak of 2007 (the index was 107.3), the burden of servicing a home loan has increased significantly from 2008, when the index was 78.9 (Interest. co.nz, 2014).
New Zealand has a centralised unitary system of government in which the central government has given local authorities certain regulatory authority but the activities of local government are ultimately controlled by government legislation. Under the Resource Management Act 1991 (RMA), local councils are responsible, through their district plans, for regulating land use activities. New Zealand planning is based on a zoning system but under the RMA emphasis shifted to controlling the environmental effects of development while preserving private property rights. This ‘effects based system’ (Gleeson, 1995) allows development to proceed where negative environmental impacts can be mitigated. Concerns over the perceived bureaucratic and inefficient nature of the RMA process emerged in the early 2000s. The election of a new government in 2008 was the catalyst for a set of reforms. These included the Resource Management (Simplifying and Streamlining) Amendment Act 2009 and the Resource Management Amendment Act 2013 (Gurran et al., 2014). These amendments were designed to simplify and speed up the planning process, with the ultimate goal of promoting economic growth and positive employment outcomes. Underpinning these reforms was a strong rhetoric, that drew heavily from the post-Barker English reform process (see Gurran et al., 2014), that positioned planning as inefficient, time consuming and a significant contributor to housing affordability problems. Gurran et al. (2014) argue that these planning reforms have witnessed an increasing concentration of central government power over local planning. The political impetus undermining these reforms has come from the election of governments dominated by the centre-right National Party that has long been associated with neoliberal and pro-market policies. The National Party’s construction of the planning system as problematic has had significant implications for the political framing of the housing reforms centred on the HASHAA.
Auckland has long had a metropolitan urban limit (MUL) (Hill, 2008). However, it was not until the late 1990s, when the then multiple local authorities operating within the Auckland region, as part of the Regional Growth Forum (RGF), developed a strong interventionist agenda designed to promote urban intensification. The RGF process explicitly recognised the potential negative impacts of growth containment on housing affordability. However, it also affirmed the benefits of controlling peripheral development and ‘minimising loss of desirable features of the rural and coastal environment’ (Regional Growth Forum (RGF), 1999: 51).
The RGF provided the guiding policy framework for urban development in Auckland until the establishment of a single territorial authority, the Auckland Council, in 2010. The new Council was formed from the amalgamation of the existing four cities, three District Councils and the overarching Auckland Regional Council (ARC) into a single governance unit. As part of the amalgamation process the new governance regime required that the Mayor develop a spatial plan. The Auckland Plan, which constitutes a 30-year roadmap for the city’s development, was published in March 2012 and this was followed by the publication of the Draft Unitary Plan (the Council’s principal land use planning document) in March 2013. Following public consultation, the Proposed Unitary Plan was released in September 2013. These documents set out the council’s planning policies and goals for the future development of Auckland. Under the Local Government (Auckland Transitional Provisions) Act 2010, a government-appointed ‘Unitary Plan Independent Hearings Panel’ reviews submissions on the plan, and the revised plan is scheduled to take effect in 2016.
The Auckland Plan’s vision is to create the ‘world’s most liveable city’ (Auckland Council, 2012: 2). As part of this process the plan envisages moving to a quality compact city which is justified on the basis that: ‘denser cities have greater productivity and economic growth’; ‘it makes greater use of existing infrastructure’; ‘improved public transport is more viable’; ‘negative environmental effects can be reduced’; and ‘it creates greater social and cultural vitality’ (Auckland Council, 2012: 42). Significantly, the Auckland Plan sets out the trajectory of housing supply and envisages that 60–70% of new housing will be developed with the existing MUL and that 30–40% of new development will take place within a new Rural Urban Boundary (RUB) that replaces the MUL.
The release of the Auckland Plan coincided with a period of considerable media and political debate concerning the causes of housing affordability in New Zealand. An important focus of this debate centred on the release of the findings of the New Zealand Productivity Commission’s (2012a) inquiry into housing affordability. This government-initiated inquiry addressed a number of demand and supply issues affecting house price dynamics in New Zealand. Significantly, drawing on an econometric analysis of differences in land values within and beyond the MUL, the report’s conclusions stressed the role of land supply constraint as a major factor in house price appreciation. In a summary provided with the final report the Productivity Commission stated: Urban containment policies have an adverse impact on housing affordability. There is an urgent need to increase land availability, to ease supply constraints and price pressure, particularly in Auckland. (New Zealand Productivity Commission, 2012b: 1)
The Commission’s emphasis on land supply constraints provided an important political context for local/central government debate. The Commission’s conclusions represented a significant challenge to Auckland Council’s ongoing desire to promote a compact city vision. From a central government perspective, the Commission’s findings accorded well with the National-led government’s neoliberal ideology (Murphy, 2009) and long held critique of the planning system (Murphy, 2014). The findings also aligned well with mainstream economic critiques of planning circulating internationally (Gurran et al., 2014). The remainder of the paper charts the evolving political positions that have emerged paying particular attention to the manner in which the Auckland Council has dealt with housing issues in its Unitary Plan, and how central government has pursued legislative change designed to ensure the release of land supply.
Auckland’s spatial plan and the Housing Accord
For the purpose of analysis the political dynamic around planning and housing affordability issues in Auckland will be examined in three distinct phases. The first phase encompassed the release of the Auckland Plan and the draft Unitary Plan by the Auckland Council, followed by the government’s response to the Productivity Commission’s report. In this phase central government initiated a Housing Accord with Auckland Council. The second phase involved the drafting and passing of the HASHAA. The third phase covers the release of the Proposed Unitary Plan and the initial implementation of the Housing Accord. Throughout these distinct phases a set of political conflicts and compromises emerged that reflected ongoing tensions concerning local government planning autonomy and central government housing policy.
Phase 1: The Auckland Plan
The Auckland Plan (2012) confirmed the Council’s commitment to a compact city and the provision of affordable housing. Noticeably, given the Productivity Commission’s criticism of Auckland’s MUL, the plan developed the concept of a RUB to replace the MUL. This RUB defines the ‘maximum extent of urban development to 2040 in the form of a permanent rural–urban interface’ (Auckland Council, 2012: 49) and allows development beyond the 2010 MUL. While focusing on urban intensification in the Plan, the RUB offered the potential to provide up to ‘40 per cent of new dwellings outside of the baseline 2010 MUL’ (Auckland Council, 2012: 50). The plan identified two anticipated ‘dwelling growth’ scenarios for 2012–2040. Under both scenarios it is anticipated that 400,000 dwellings will be added to the housing stock by 2040 and while the majority of this development will involve development within the 2010 MUL (from 240,000 to 280,000 units), 120,000 to 160,000 units will be built outside of the MUL. Moreover, the release of new greenfield land is predicated on the provision of appropriate infrastructure services, rather than a wholesale rezoning of rural areas.
The Draft Unitary Plan contains the planning rules that give effect to the spatial plan. In terms of housing affordability issues, an addendum to the draft plan set out ‘additional tools for enabling affordable neighbourhoods’ (Auckland Council, 2013a: 1). In particular, the Council proposed the adoption of an inclusionary housing scheme that required ‘… developments of ten or more dwellings to provide a set percentage of the homes (e.g. 10% to 20%) at an affordable price’ (Auckland Council, 2013a: 23). The proposed regime distinguished between greenfield areas, where inclusionary housing would be mandatory, and brownfield areas, where inclusionary housing would be voluntary and would be incentivised through the use of height and/or coverage bonuses.
The broad parameters of the Auckland Plan and the details of the Draft Unitary Plan accord well with planning practice and models developed in Australia and England, and reflect the increasing international mobility of planning models (Austin et al., 2014; McCann and Ward, 2011). In effect, these policies were embedded within a particular conceptualisation of planning practice and land supply dynamics that emphasises demographic ‘trend based quantity planning’ rather than ‘housing output’ targets focused on addressing housing affordability (see Bramley, 2013). Moreover, the various plans and policies (e.g. inclusionary housing) are clearly located in established institutional practices and accepted norms of ‘best practice’ urban planning.
For central government, increasing housing affordability problems constituted a significant political problem. The National government, long associated with neoliberal and market-led policies (Murphy, 2009), argued that its prudent economic policies had resulted in historically low mortgage interest rates and that this was a key element in supporting housing affordability. However, as the public demand for government action on housing affordability issues mounted, the government faced the prospect of being labelled inactive. The Productivity Commission’s conclusions regarding the negative impact of planning regulation on house prices offered an important opportunity for the government to challenge the local planning regime. In line with the National government’s desire to reduce the perceived overly regulatory nature of the planning system (MBIE, 2013), and its programme of planning reforms begun in 2008 (Ministry for the Environment, 2015), it announced a Housing Accord with Auckland Council in May 2013 that facilitated the ‘fast-tracking’ of planning permission for up to 39,000 residential dwellings in three years (Auckland Housing Accord, 2013). In effect, the Accord short-circuited the regulatory review process surrounding the adoption of the Auckland Unitary Plan and facilitated immediate land release beyond the existing MUL.
In deciding to adopt Special Housing Areas the Minister of Housing took advice from MBIE who provided a review of policy options as part of a Regulatory Impact Statement (RIS). A key assumption of the RIS was that ‘land supply for residential development is artificially constrained by current regional and district plans’ (MBIE, 2013: 1). This assumption was supported by MBIE’s own analysis of land supply within Auckland’s MUL where it was argued that this supply was ‘insufficient to meet future expected demand’ (2013b: 8). Of the options reviewed by MBIE (2013), Special Housing Areas were deemed to be most effective and cost efficient. MBIE envisioned Special Housing Areas as areas in which Councils would be ‘legally empowered to take permissive approaches to consenting developments’ (p. 15). It argued that within special housing areas the reduction in the right of review and appeal would reduce risks for developers and would encourage housing production. Moreover it was argued that the creation of Special Housing Areas would increase uncertainty for landowners who were considering not selling (holding land for a possible future development) and that: This uncertainty will change the balance of commercial incentives on land owners in favour of more short term sale of land and less long term holding of land. This will ease pressure on land supply over the short term that should slow the rate of land price appreciation and contribute to improved housing affordability. (MBIE, 2013: 15)
The Auckland Accord required the identification of Special Housing Areas that were subject to fast-track planning permission, included a commitment to a target of 39,000 housing units in three years and involved an ongoing partnership between the Council and the Minister of Housing to identify additional Special Housing Areas. From the Council’s perspective, the Accord offered a strategic benefit as it brought forward the release of land supply in the RUB in advance of the Unitary Plan becoming operative in 2016. In addition, the Accord included a section on affordable housing that stated: All Qualifying Developments are therefore required to give consideration in the provision of affordable housing and/or first home buyer purchase. Conditions of consent may include requirements for a proportion of the development to include affordable housing and/or the provision for first home buyer purchase. (Auckland Housing Accord, 2013: 4)
From the central government perspective, the term accord could be viewed as a misnomer since the government’s public position at the time was particularly critical of the negative impact of planning on land supply. Reflective of the general level of antagonism toward the Council’s policy of urban containment, the Deputy Prime Minister and Minister for Finance, Bill English, commenting on the Accord stated: What’s stacked against first home buyers are planning laws that are explicitly designed to drive up housing values … They’re explicitly designed to ensure that house prices go up so that they can afford the intensification and the very high-value, high-cost urban design that goes with that. (National Business Review, 2013)
English’s pronouncement offered a significant contribution to the public debate on housing affordability. Moving beyond a technical critique of MULs he identified planning laws as the prime driver of housing affordability problems. His argument aligned with an emerging international policy critique of planning’s impact on house prices (Gurran et al., 2014) but, more importantly from the local political context, it aligned with the National Party’s long held commitment to planning reforms (Austin et al., 2014) and the promotion of market-based solutions.
Phase 2: The Housing Accords and Special Housing Areas Act
To give effect to the Auckland Accord the HASHA Bill (2013) was introduced in May 2013. The evolving nature of the proposed legislation exposed considerable political differences between the government and the Council.
The purpose of the legislation was ‘to enhance housing affordability by facilitating an increase in land and housing supply in certain regions … identified as having housing supply and affordability issues’ (HASHA Bill Section 4: 4). The underlying logic propelling this legislation was that housing affordability could be addressed by increasing land supply. The Bill proposed that the government, in consultation with local authorities, identify regions where Special Housing Areas can be created and seek to enter into an accord with the relevant local council. Within the Bill the government reserved the right to assume the power to consent developments. The Deputy Prime Minister, reflecting on this power stated: … here is legislation that allows us to give the councils the tools that they need and makes it clear that … if that doesn’t work well, then the government has the ability as a reserve power to issue consents itself. (National Business Review, 2013)
Auckland Council’s submission to the Social Services Select Committee identified a number of problems with the Bill. Most importantly, the Council argued that the Bill provided the government with the power to override local government planning and consenting functions, and that ‘these clauses do not respect the principles of local democracy or those that underlie the establishment of accord agreements’ (Auckland Council, 2013b: 10).
The Council’s submission highlighted the potential for ongoing conflict between local government planning processes and the Minister of Housing’s powers to consent housing permissions. The adversarial nature of the relationship was evident in the pronouncements of the Minister of Housing, Dr Nick Smith. In introducing the Third Reading of the Bill he stated: We have got a constipated planning system bogging new residential construction, and this bill is a laxative to get new houses flowing … It overrides Auckland’s metropolitan urban limit, freeing up thousands of hectares of land for housing. It fast tracks the consents process … It makes plain that the Government’s strong preference is to get this work done in partnership with councils, through housing accords, but it also provides that the Government can get on with the job if councils stand in the way of delivering an increased supply of affordable housing. (New Zealand Parliament Debates, 2013)
The Bill and the Minister’s statement seemed to be at odds with the spirit and intent of the Auckland Accord, especially as viewed from the Council’s perspective. For Auckland Council the Accord offered the opportunity to bring forward development envisioned in the Unitary Plan, while still adhering to the procedures of the planning process. For the National government, the Accord, as read through the lens of the legislation, provided a mechanism to release land for development through either negotiation with local authorities or through direct powers.
The HASHAA came into effect in September 2013. With respect to the provision of affordable housing, Section 15 of the Act states ‘one of the criteria that may be prescribed is the percentage of dwellings that must be affordable dwellings’. The affordability criteria ‘may include, without limitation, criteria defined by reference to median house prices, median household income, individual income, the median multiple … or any other matter relevant to affordability as it applies to the district in which the special housing area falls’ (HASHAA Section 15). As stated, the legislation provides no criteria for ensuring that the housing that is built within Special Housing Areas (SHAs) is affordable to low income households or that any affordable housing is retained.
Phase 3: Auckland’s SHAs
As central government introduced the HASHAA, Auckland Council responded to public submissions on its Draft Unitary Plan, released its Proposed Unitary Plan, and ratified the Auckland Accord. While the Council’s intensification plans were challenged, particularly in terms of proposed new building heights in urban and town centres, the council’s overall goal of compact growth and the idea of a RUB were preserved. Significantly, the Proposed Unitary Plan adopted an explicit policy on inclusionary housing. The plan states: ‘Where a new development within the RUB contains more than 15 dwellings or involves the creation of more than 15 vacant sites, at least 10 per cent of the total number of dwellings or vacant sites within the development must be retained affordable housing’ (Auckland Council, 2013c: H299).
The Proposed Unitary Plan is subject to review, therefore it remains to be seen whether this policy will be implemented. However, what is significant about the Council’s move to adopt inclusionary zoning, and particularly ‘retained affordable housing’, is that it represents a direct challenge to central government’s focus on land supply as the primary mechanism for addressing housing affordability. Moreover, it is arguable that these inclusionary housing provisions represent the type of regulatory hurdle that is anathema to the rhetoric of the Minister of Housing and is a direct challenge to the National government.
Between October 2013 and September 2014, four tranches of SHAs (totalling 80 development sites) were announced in Auckland. These were expected to generate 11,000 homes or sections 1 within three years and ultimately 43,000 dwellings when fully completed (MBIE, 2014). Under the legislation SHAs are required to make a contribution to housing affordability. In practice developers of 15 dwellings or more have been required to provide either 10% of units at a price set below 75% of the median regional house price or 5% of units at a price that will result in a monthly mortgage of less than 30% of the gross income of a household on the Auckland median income (Housing Accords and Special Housing Areas (Auckland) Order, 2013). These criteria fall short of the inclusionary housing provisions of the Proposed Unitary Plan. Indeed, providing dwellings at 75% of the median regional house price offers no guarantee that the units will be affordable and there is no mechanism for ensuring that any affordable dwellings remain affordable. From the developer’s perspective these criteria could be met by simply including an appropriate product mix (one to five bedroom units). In effect, these criteria offer few challenges to developers who are prepared to provide a mixed product development and as such sit well with the government’s desire to minimise the regulatory burden on developers.
Official reviews of the progress of the SHAs have emphasised the speed of the consenting process and the volume of consents issued (MBIE, 2014) and little attention has been given to the volume of affordable housing generated. This emphasis on overall housing output accords well with the National government’s policy agenda that emphasises housing supply as central to dealing with the issue of housing affordability. Notwithstanding the administrative cooperation between the Council and MBIE in the creation of SHAs, it would seem that central government’s housing agenda is dominant.
Discussion
In the Auckland Plan the Council has opted for a compact city form that allows for up to 40% of new housing to be developed on greenfield sites. Significantly, the Unitary Plan positions the Council as an active agent in procuring retained affordable housing. Cognisant of the criticisms of the New Zealand Productivity Commission (2012a), but mindful of planning models developed elsewhere (Austin et al., 2014; Gurran and Whitehead, 2010; Mallach and Calavita, 2010) the Council has moved to adopt a mandatory inclusionary housing policy. It remains to be seen if this policy will be implemented but the evolving policy-making trajectory clearly demonstrates the Council’s strong desire to negotiate with developers around affordability issues in the consenting process, rather than simply relying on market forces to provide affordable houses. In developing its plans the Council has built upon existing planning practice and incorporated planning ideas from overseas. The various plans are embedded in rationales and logics that have considerable international currency and draw upon demographic modelling and international best practice.
In contrast to the Council’s compact city model, the National-led government (and central government policy-makers at MBIE) has pursued a policy that prioritises land supply. In this context the government is drawing upon international debates that have highlighted the negative impacts of planning regimes that restrict housing supply (see Bramley, 2013). Indeed, the government’s emphasis on addressing housing supply constraints is in line with policy trajectories in Australia and England (Gurran et al., 2014). Significantly, the government has argued that the planning system, and in particular the drive to promote compact urban growth, is at the heart of the affordability crisis in Auckland. Within the specificities of the New Zealand housing system, the government has reduced the drivers of house price change to a single variable (planning constraint) and set aside demand factors (e.g. liberalised mortgage markets, tax system, user cost of capital – see New Zealand Productivity Commission, 2012a). In this context, it is arguable that the government’s drive to facilitate the release of land for development aligns with a longer-held political commitment to reform the planning system in New Zealand (MfE, 2015).
The Auckland Housing Accord and the HASHAA represent key elements of the central government’s response to Auckland’s housing affordability issues. At one level the Auckland Accord can be interpreted as a pragmatic and successful form of local–central government cooperation. However, the HASHAA enables central government to take a more direct role in the consenting of residential developments and offers the potential for central government to override the local planning process if required. In this context, the HASHAA can be viewed as a significant political intervention that repositions central government as a key actor in the local planning process and, in the view of the Auckland Council, challenges the ‘nature of local democracy’ (Auckland Council, 2013b: 10). At the very least, it provides a legislative ‘stick’ for central government in its negotiations with local government over SHAs.
In terms of EBP processes, the power dynamics around housing accords and the HASHAA point to an ongoing political struggle rather than an emerging consensus. Drawing on different and conflicting peer-reviewed research frameworks, local government continues to position planning as having a role in promoting affordable housing provision, whereas central government promotes market forces and increased housing supply as the appropriate response to housing affordability issues. These distinct policy positions are embedded in different knowledge frameworks and empirical evidence, and represent a significant challenge for policy-makers seeking to construct a ‘single’ policy response to housing affordability issues (cf. Adams, 2011). In contexts such as these, focusing on the politics of policy construction (Jacobs and Manzi, 2013) provides insights into the evolving power relations at work.
Conclusions
Issues surrounding housing affordability, land supply and the nature of urban planning have assumed increased significance internationally (Adams, 2011; Austin et al., 2014; Ball, 2011; Ball et al., 2009; Cheshire, 2008). In developing new urban/housing legislation and polices, policy-making practice is clearly embedded in nationally constituted and temporally specific policy contexts (Malpass, 2011; Murphy, 2009). However, it is increasingly argued that policy-makers are linked to dynamic knowledge/policy networks that facilitate policy mobility (McCann, 2011; McCann and Ward, 2011; Prince, 2012) and various forms of (often partial or nominal) policy transfer (Austin et al., 2014; Gurran et al., 2014; Parsell et al., 2014; Pawson and Hulse, 2011). Moreover, both central and local government polic-makers legitimate their agendas by recourse to EBP practices (Jacobs and Manzi, 2013) that place emphasis on international models, best practice and academic evidence (McCann, 2011). Jacobs and Manzi (2013) highlight the ideological import of this shift to EBP and argue that policy-making is an inherently political project. Developing upon Jacobs and Manzi’s (2013) call for attention to be given to the politics of policy development, and picking up on Adams’ (2011) argument that planning for housing development is an inherently ‘wicked’ problem not amenable to a single technical solution, this paper examines a significant historical moment in the politics of land supply and planning in New Zealand. In particular the paper traces local/central government conflicts arising during the development of Auckland’s spatial plan, the announcement of an Auckland Housing Accord and the introduction of the HASHAA.
Employing an interpretative discourse analysis of a significant range of formative and final policy documents, I trace how the policy ideas/models/research that have informed the development of the Auckland Plan clash with the ‘affordability/land supply’ analysis employed by central government and MBIE. This clash reflects differences in political ‘values and interests’ (Adams, 2011). Resolving differences in these policy models and frameworks involves a set of political decisions that reflect the different constituencies and the political concerns of populations and vested interests at different spatial scales. In this paper I have argued that policy-makers at both central and local government levels are key agents, or vested interests, actively creating and re-creating policy practice within an unfolding power dynamic. In New Zealand, these power struggles are being played out in the context of legislative reforms and practices that are altering central and local government power relations.
Reflecting on the nature of planning for housing development Adams (2011: 958) argues that: ‘… although no government may ever be able to solve the problem of planning for housing development, each will be likely to re-frame that problem to serve the particular interests then in the ascendancy’. This re-framing process, as illustrated by the Auckland case study, has the potential to refashion central and local government power relations with respect to land supply and planning practices. Significantly, the HASHAA marks an important legislative intervention that provides planning powers for the Minister of Housing that challenge long-established local planning powers. The Auckland case study illustrates how emerging global and local pressures to address housing affordability issues have the potential to fundamentally alter central and local government power dynamics around urban land and housing supply issues.
Footnotes
Acknowledgements
This paper was substantially revised while I was the Helen Cam Visiting Fellow at Girton College Cambridge. I would like to thank the Mistress, Professor Susan Smith and Fellows of Girton College for their support and encouragement. The paper has benefited from the insightful comments of the Editor and anonymous referees.
Funding
This research received no specific grant from any funding agency in the public, commercial, or not-for-profit sectors.
