Property editor of the NZ Herald

Money collected by councils rising

Labour says reforms to rein in amount have failed.
Labour housing spokesman Phil Twyford says the changes are a flop. Photo / NZME
Labour housing spokesman Phil Twyford says the changes are a flop. Photo / NZME

A $23 million annual increase in development contributions collected by councils means the Government's reforms have failed, an opposition MP claims.

Phil Twyford, Labour's housing spokesman, said councils got an extra $23 million, or 9 per cent more, from developers in the last year.

That meant attempts to control councils and rein in the amount they collected had failed dismally, he said.

"The changes are a flop," Twyford said.

Nick Smith, Building and Housing Minster, disputed Twyford's claims. Building activity had picked up substantially, he said, yet the increase in contributions was below that pickup level.

Contributions had historically gone up and down with the building cycle.

"Increases are small given the degree to which the building sector in places like Christchurch and Auckland is booming," Smith said.

A spokesman for Smith said amendments to the Local Government Act had restricted what councils could charge, brought more transparency and accountability to the sector and reforms were extensive.

The system had been overhauled so developers who believed they were being charged incorrectly could challenge that, with the outcome determined by an independent commissioner, the spokesman said.

Twyford said he had made inquiries into the issue via the Parliamentary Library to see what had happened after the law changed.

That inquiry resulted in him discovering the top five councils whose contributions had risen the fastest.

Top of the list was Christchurch City Council, whose contributions were up from $24 million to $33.2 million, followed by the Waikato District Council, up from $6.4 million to $14.4 million, and Auckland Council, up from $102 million to $107 million.

"The data from annual reports is from the Library and the calculations are done by our Labour research staff. It appears so far one case has been taken under the new legal framework for reviewing development contributions and the council won it," Twyford said.

Smith last month claimed victory from Government reforms when rising building consent data was issued.

"The Government is keeping its foot on the accelerator to ensure this positive momentum continues.

"The Government is continuing to free up more land faster through the Auckland Housing Accord, together with the council," he said.

The Government had put in place initiatives to constrain building materials costs, rein in development contributions, cut compliance costs and invest in improved sector productivity, Smith said after Statistics NZ data showed 27,745 residential consents were issued in the year to February, up from 24,766 the previous year.

Top five increases

• Christchurch City Council up from $24m to $33.2m
• Waikato District Council up from $6.4m to $14.4m
• Auckland Council up from $102m to $107m
• Tauranga City Council up from $14.7m to $19.1m
• Queenstown Lakes District Council up from $5.5m to $7.9m

- NZ Herald

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