Acting Prime Minister Grant Robertson has announced a further three projects have been approved under the Government's provisions to fast-track some projects through the Resource Management Act process.
A 315-housing unit development near Queenstown has been approved. The Flint's Park West, Ladies Mile - Te Pūtahi project is a medium-density housing development in the Lake Hayes area and will create 617 jobs, he told media during a post-Cabinet news conference today.
The project is to subdivide an 18.4-hectare site and construct approximately 315 residential units (or approximately 180 residential units, a church/chapel and a state-integrated school), supporting infrastructure and public open space, on 8.6 hectares of the land.
Also announced was the New Zealand Wind Farms Te Rere Hau Wind Farm project, which expands the existing wind farm in the Tararua range southeast of Palmerston North. The project will involve removing 97 existing 2-blade, 47-metre-high turbines, installing 30 new 3-blade, 162-metre-high turbines and constructing associated infrastructure.
And new housing units in the Waimarie St residential development in the Auckland suburb of St Heliers are planned.
This residential development project will create approximately 58 residential lots accommodating approximately 58 residential units in (predominantly) terraced houses between 2 and 3 storeys high, and associated infrastructure including a pedestrian access way to Waimarie Street, vehicle access ways and parking areas, and infrastructure for three-waters services.
Robertson said the boom in house construction, combined with the apprenticeship boost initiative, is driving up the number of skilled New Zealanders available to work on these projects.
It brings to 50 the number of projects that have been consented about 15 months more quickly than usual under the provisions to fast-track some projects.
Robertson said re-opening to the world is critical for the economic rebuild, so Prime Minister Jacinda Ardern's week-long trip to Singapore and Japan is important, as is the re-opening of the borders.
"Growing our economy and creating more jobs while controlling debt are key components to rebuild the economy."
Robertson took the reins in a post-Cabinet news conference and chaired the Government's weekly meeting today.
He said the big drivers of cost of living pressures were offshore, including Covid-19 supply disruptions and the war in Ukraine, rather than government spending.
While the Government had to keep an eye on its spending and ensure it was value for money, cuts to services would be detrimental, he said.
Health reforms would include a one-off cost, but the operational budget was critical.
"Government spending on the health system is important. If we cut that, it will not have an effect on the cost of food or petrol."
He said the moves to cut fuel excise for three months and road user charges would have an impact on inflation and he expected the CPI statistics later this week to reflect that.
New data out this week is expected to show annual inflation heading to 7 per cent or higher.
The Government would set new fiscal rules for itself, after abandoning the earlier set due to Covid-19. Those rules in the past have covered issues such as debt reduction targets.
"We will continue to keep a lid on debt, We were well served by having relatively low debt when we came in [to Covid-19} but I also have to address an infrastructure deficit."
He said the wide-spread support during Covid-19 was no longer draining the books and instead more targeted cost of living cost was under way.
He said there were areas of investment which had be to be carried on with, such as state housing, "but every decision we make at the Budget is based on whether we get value for money" and whether it was needed.
Govt acknowledges housing crisis
Robertson said the Government acknowledged there was a housing crisis, and the Reserve Bank's job was to keep an eye on inflation, but the Government had to meet the needs of New Zealanders.
He believed it would take some time for measures to increase competitiveness in the supermarket industry to take effect - possibly a year or more.
In the interim, the Government was trying to ease pressure on low to middle income families. While inflation was predicted to keep rising into the second quarter of the year, it was forecast to drop back past that, he said.
He would not hint whether next month's Budget would include further relief for those struggling with inflation, but said the Government was always looking for ways to make life easier for people.
On the ability for people to pay their mortgages as interest rates rose, Robertson said there was no doubt that some would experience mortgage stress.
"How that plays out depends on individual circumstances."
For some that would mean cutting their discretionary spending - at the worst end, some could be forced to sell their homes.
He said it was part of the cycle, and the Government had tilted the market toward first-home buyers more, but people had to be able to pay their mortgages.
The Government's role in feeding these inflationary pressures is a hotly contested political issue, with National arguing the Government's massive economic stimulus has overcooked the economy.
Reserve Bank Governor Adrian Orr, whose job is to keep inflation stable, this morning said that central banks would not be able to achieve their mandates around inflation and maximum sustainable employment on their own.
"We are going to need support," he said.
That would require clear communication with "fiscal authorities" and "how they could assist around more targeted effective fiscal policies".
Those remarks promoted National finance spokeswoman Nicola Willis to call for more fiscal restraint from the Government.
"The Finance Minister must heed this warning," she said.
Robertson should take the comments seriously and "rein in extravagant spending plans", Willis said.
Robertson told RNZ this morning the inflation rate would likely rise before falling. He acknowledged it was likely to get higher before falling, as this had been the forecast of many global commentators.
"I expect that it will be rising as it is right around the world," Robertson said. "The amount that it rises by is obviously what everyone is debating."
In the United States and United Kingdom the inflation rate has now topped 8 per cent.
Tourism
On cruise ships returning to New Zealand, Robertson said a decision was likely in the next couple of weeks. There appeared to be no intention for cruise ships to return until at least October and a decision would be made before then.
The Government was awaiting further advice from the Ministry of Health before making a decision to allow them in - given difficulties on cruise ships at the start of the Covid pandemic.
He was keen to see the ships return as a valuable source of tourism.
- NZ Herald and RNZ
