Idea of an urban development authority, touted by experts for at least a decade, may again fall on deaf ears.

Once again, the Productivity Commission is pushing for an urban development authority (UDA), to acquire, plan and build - with private enterprise help - large-scale housing developments. Commission chairman Murray Sherwin says an aggressive approach is needed to meet the demand for housing.

It's not the first time government advisers have recommended this approach to Auckland's ongoing housing shortage. In its April 2012 report on housing affordability, the commission itself flirted with it, recommending Auckland Council "look to collaborative models for the process of identifying, assembling and releasing large tracts of land".

Several months later, Finance Minister Bill English agreed, noting supportively that Auckland Council had committed "to investigate increased use of special-purpose agencies, such as urban development authorities to undertake planning and implementation of housing developments".

In 2009, the Government's Urban Taskforce proposed a UDA be established "to accelerate both the quantity and quality of urban developments," noting it was "a tried and tested approach to complex urban development ... commonly used to bring all the parts of an important development package together in a consistent and integrated manner."


Earlier, in 2006, and 2008, reports from the Ministry for the Environment and the inter-agency Sustainable Urban Development Unit said the same. All to deaf ears.

As Auckland's housing crisis grew, neither the Clark Labour Government nor the Key National Government got the message.

The closest they got was the Hobsonville Land Company, a Housing New Zealand subsidiary set-up by Labour to mastermind a 3000-house development on the old Hobsonville airbase. National's main interest in this project on taking office in late 2008 was to honour the campaign pledge of local MP John Key - now prime minister - that if elected, the 500 state rental component proposed by Labour would not darken the development.

The land company was upset at my reference in a recent column to their "glacial pace" of building since then, but what else can you call just 400 houses occupied (their latest figure) after more than 16 years in business. Last week Housing Minister Nick Smith proudly announced the "fast-tracking" of the next 1000 at the site, saying these would now be available from 2017, not 2019. The last of the Hobsonville homes would finally be released by 2023.

As a solution to Auckland's shortage, with prices now escalating at up to 20 per cent a year, "fast-tracking" is the last word I would use.

The Productivity Commission would agree. "Auckland has an existing shortfall of as many as 32,000 dwellings and requires a further 13,000 dwellings a year to accommodate new growth. This is the equivalent of 11 more Hobsonvilles immediately, and a further four completed each year."

It says, "The market alone will not address these challenges; a greater degree of public leadership and equity participation in development is likely to be required."

It dismisses the Government's Special Housing Areas as being too small and scattered to attract developers able to deliver on a scale required to ameliorate the housing shortage in Auckland.


As for the existing residential construction sector, it "is essentially a fragmented 'cottage industry' dominated by very small independent builders" making "efficiencies in the use of land, or construction itself, difficult to realise".

It highlights the need for a Government UDA, "operating on a commercial basis", noting how they play "an important role in urban regeneration and residential growth strategies in Australia, the United Kingdom, Hong Kong and parts of the United States".

They typically lead the development of specified areas, sometimes with compulsory acquisition or planning powers allowing them to amalgamate smaller landholdings and rezone the combined site.

Bravely, the commission also discusses ways the community could recover part of development costs by clawing back windfall profits made by private land-bankers as a result of public action such as rezoning or the provision of new infrastructure. A land tax, for instance, or a one-off betterment levy are suggested.

It revisits all the other suspects raised in their housing affordability report, such as easier planning regulations and the like, but returns to supply, or the lack of it. "The scale of the current housing shortage," it concludes, "justifies more interventionist approaches that will unlock land for large-scale developments ...

"A UDA could play an important role at the nexus of a number of barriers to land supply..."

For at least 10 years, the experts have been telling governments this. How many zeros will be added to the value of Mr Key's Parnell mansion before he accepts?