Here is that long promised fiasco...

Minister of Housing Nick Smith. Photo / Jason Oxenham

With the Opposition's relentless description of the Government's housing policy as "a fiasco", there was a chance they would be right one day.

This week they were right.

While housing spokesman Phil Twyford has been doing a masterful job of lifting his profile and keeping the housing issue top of the political agenda, his fiasco mantra had been starting to grate.

But there was a tipping point in March, when the annual Auckland housing price rise was 17 per cent.

That was about the time the Government realised the house inflation problem was worsening, about the time the Government accepted IRD's advice that many foreign investors were using the Auckland housing market to avoid tax in their home country, and probably about the time National's pollsters told them that comfort in growing equity had turned to worry about a bubble.

A new policy was needed. A policy is overstating it. It was more an idea.

Essentially it was to replicate the successful Hobsonville and Weymouth models in smaller patches of surplus land around Auckland - a combination of private developers and government land.

Housing Minister Nick Smith is a heart and soul politician and he has been pouring all of his into converting the idea into workable policy. The policy was rushed and he has been rushing to fill the detail. One or two mistakes about the ownership of a property or a parcel of land being next to a cemetery have been comical but were hardly a federal case.

But the issue of whether iwi should have been issued the right of first refusal is a more serious matter. It goes to the Government's understanding of its own legislation and to good faith. It is nothing but a fiasco when the Government says Ngati Whatua don't have a right of first refusal, when through a legal instrument of a limited partnership, they do.

Some iwi and their lawyers believe that when the Government is privatising land, as it plans to do here, that the courts may not be persuaded by the statutory exemption the Government is relying upon.

Even if they are wrong, it is a case worth testing.

Now is the time for less haste.