Not Ministerial language but . . .

August 16, 2016

Immigration Minister Michael Woodhouse posted on Facebook:

Plenty of Q&A from attendees at the annual NZ Association of Migration and Investment conference today.

Michael Woodhouse MP's photo.

He got several responses, one of which was:

Mark Lambert Here’s a question n answer in one, when are we going to get tough n say no more immigrants? And if yr answer is why then you need to go to specsavers, then remove yr self from my page ….

To which he replied:

Michael Woodhouse MP I think you’ll find you’re on my page you redneck.

Several others responded, most of whom had realised what the first commenter hadn’t – he’s in the UK and the Minister is a New Zealand MP.

The commenter’s last comment included several expletives and the hope he’d meet the Minister one day to which he got this response:  unlikely, NZ has a strict no dickheads rule.

It isn’t Ministerial language but sometimes giving in to the temptation to respond in that way is understandable.


The story but not the whole story

April 1, 2016

RNZ asks is the minimum wage increase helpful or hopeless?

. . .  a cleaner who does night shifts at Auckland Council said the rise was still not enough to make it easier to support her family.

Before today, Lupe Funua’s wage was $15.10. That rate would be pushed up 15 cents to match the new minimum wage.

With a three-year-old son at home, a baby due in a few months, and a husband who was also a cleaner on minimum wage, she said every week she worried she was not earning enough. . . 

That’s the story but not the whole story which should include the family’s entitlement to Working for Families and they might also be eligible for housing assistance.

. . . Once the bills were paid, she said she had nothing to send home to her parents in Tonga, which devastated her. . . 

Wanting to help her parents is commendable but an employer can’t take that, or any other wishes however noble they might be, into consideration when determining what wage rates are affordable for the business.

Workplace Relations and Safety Minister Michael Woodhouse said the government first considered a 25-cent rise, but decided to be more generous.

He said lifting the rate any higher would mean some people losing their jobs.

That is a very important part of the story. Increasing the minimum wage can cost jobs and drives the move to more mechanisation. It also has a flow-on affect for people who are paid more the legal minimum.

Federated Farmers dairy chairman Andrew Hoggard said any rise would affect the struggling dairy industry.

“I think the concern for farm employers might be around farmers employed in the roles above those on the minimum wage – farm assistants – who would also get a boost,” he said.

“That’s going to be the discussion that farm employers will have with the employees and for many it’s not going to be an option.” . . 

I don’t know anyone who pays farm workers the minimum wage and most farm staff have non-cash rewards like a rent-free house which takes their annual effective pay well above the minimum.

 

 

 


Rural round-up

January 13, 2016

Alliance moves to deepen cooperative culture as Silver Fern sells stake – Tina Morrison:

Alliance Group, New Zealand’s second-largest meat processor, plans to entrench its cooperative status, encouraging farmers to ‘share up’ at a time larger rival Silver Fern Farms is watering down its cooperative by tapping a Chinese investor for capital to repay debt, upgrade plants and invest for growth.

Farmer groups failed last year to force a mega-merger on the country’s two large South Island-based meat cooperatives. Both changed chief executives last financial year and Dunedin-based Silver Fern is now awaiting regulatory approval for the $261 million sale of half its business to Shanghai Maling Aquarius, while Invercargill-based Alliance is moving its business model further towards a cooperative system. . . 

Milking sheep has potential to earn billions of dollars for NZ –  Jill Galloway:

Isobel Lees did a veterinary degree at Massey University and is now in Grenoble, France, doing a post graduate study in sheep milking.

She says her research investigating if New Zealand can establish an internationally competitive sheep dairy industry might shed light about how farmers might set up the industry.

“This research focused on the lessons learnt from France, a world leader in sheep dairy.”

Her studies indicate there is vast potential for New Zealand to establish a sheep dairy industry and for it to be a billion dollar contributor to the economy.

“New Zealand has a competitive advantage and superior performance. It has pasture-based agricultural production systems, leading innovations from the dedicated agricultural research community and market leading standards for sustainability, animal welfare and food safety.” . . .

Turangi Maori land trust brings in Chinese partners for sheep milk expansion – Paul McBeth:

(BusinessDesk) – Waituhi Kuratau Trust, the Turangi-based Maori land trust, has teamed up with Chinese interests to develop its sheep-milking interests as part of a plan to sell into the world’s most-populous nation.

The trust sold a leasehold interest in 490 hectares of land in Kuratau to Maui Milk for $1.2 million, which has been slated for development into a sheep dairy farm, according to the Overseas Investment Office summary approving the transaction. The trust owns 40 percent of Maui Milk, with the remainder held by four Chinese nationals. . . 

Govt happy with farm conditions monitoring:

The Government is ruling out an an inquiry into the pay and conditions of farm workers in New Zealand, saying standards are already in place.

Former Council of Trade Unions head Helen Kelly made the call, saying many farm workers were working up to 70 hours a week for low pay, and that was leading to high staff turnover. 

She said fatigue was a major cause of workplace accidents, and an official inquiry was needed to introduce regulations.

But Workplace Relations Minister Michael Woodhouse said the Labour Inspectorate already monitored non-compliance with minimum employment standards in the dairy sector. . . 

Right attitude key to $70k jobs – Tamsyn Parker:

A farm worker with the right attitude could take fewer than five years to get to a $70k-plus salary, says an industry leader.

Andrew Hoggard, a farmer who is on the board of farming body Federated Farmers, said Seek data showing a 14 per cent rise in the average salary for the sector was probably a little high as it was based only on jobs advertised through that business. . . 

Federated Farmers mourns the loss of life member Gordon Stephenson:

Federated Farmers expresses their deepest sympathies to the family of farmer and environmentalist Gordon Stephenson who died on Boxing Day.

A stalwart of Federated Farmers, Mr. Stephenson served as national chairman of the dairy section from 1973 to 1977 and instigated the Farm Environment Awards in 1991.

“Gordon was instrumental in the formation of QEII National Trust and the legacy he’s left behind can be seen all around the country in the land and native forests now voluntarily protected by farmers through the Trust,” says Federated Farmers National President Dr. William Rolleston. . . 

Farm Environment Awards Founder Leaves Lasting Legacy:

The passing of Farm Environment Awards founder Gordon Stephenson is a huge loss for New Zealand agriculture, Simon Saunders, chairman of the New Zealand Farm Environment Trust (NZFET), says.

“Gordon was a farsighted and inspirational leader. As a passionate advocate for conservation he was steadfast in his belief that good farming and good environmental management go hand in hand. This message is still very much at the heart of the Ballance Farm Environment Awards (BFEA) today.”

Mr Saunders says the establishment of NZFET and the success of the BFEA programme are legacies of Gordon Stephenson’s drive and vision. . . 

Federated Farmers grieves loss of former Chief Executive:

Federated Farmers is saddened by the death of former Chief Executive Tony St Clair.

Mr. St Clair served as Chief Executive between 1997 and 2005 following several years as Executive Director of the Victorian Farmers Federation.

“Tony was an inspirational and passionate advocate for agriculture and farming and he had an intimate and detailed knowledge and understanding of Federated Farmers,” says Federated Farmers National President Dr. William Rolleston. . . .

 

Fonterra Announces Record Export Volumes in December:

Fonterra Co-operative Group Limited today announced it has exported record volumes for the month of December 2015.

Export data for the Co-operative in December confirms the new record for a single month’s volume, with more than 300,000 MT shipped to its global markets.

December’s volume was approximately 10 per cent higher than Fonterra’s previous record month in December 2014. . . 

NZ honey exports double in November on manuka demand – Tina Morrison::

(BusinessDesk) – New Zealand honey exports doubled in November as the country benefited from demand for high-value manuka honey.

The value of honey exports jumped to $27.4 million in November from $13.6 million the same month a year earlier, according to the latest Statistics New Zealand data. That helped boost the annual value of honey exports in the 12 months through November by 45 percent to $281 million, the figures showed.

New Zealand is the world’s third-largest exporter of honey by value, behind China and Argentina. However it is only the 16th biggest global supplier on a volume basis, reflecting the premium price garnered for manuka honey, which accounts for as much as 80 percent of New Zealand exports and is prized for its health benefits. . .

Final report into killer swedes released:

The group investigating the fatal poisoning of hundreds of animals by swedes in Southland has issued one last warning to farmers not to feed herbicide tolerant swedes to cows in the spring.

The Southland Swedes working group today released its final report into the incident which left hundreds – if not thousands – of sheep and cows dead across the region.

In 2014 farmers across Southland reported sick, dead and dying livestock – after they’d been fed on swedes – mostly a new herbicide tolerant variety developed and sold by PGG Wrightson Seeds.

Farmers were subsequently warned by industry experts not to feed the HT Swede variety to cows when they were heavily pregnant or with calves – because the chemically mutated HT swedes were producing unnaturally high levels of glucosinolates that are toxic to livestock. . . 

 Recreational fishing parks proposed in Hauraki Gulf and Marlborough Sounds as part of Marine Protected Area reform:

The Government has today launched a consultation document on a new Marine Protected Areas Act to replace the Marine Reserves Act 1971 that includes proposals for recreational fishing parks in the inner Hauraki Gulf and Marlborough Sounds.

“We are proposing a new system of marine protection that will include marine reserves, species-specific sanctuaries, seabed reserves, and recreational fishing parks. This more sophisticated approach with four different types of marine protection is similar to the graduated approach we take to reserves on land that vary from strict nature reserves to those for a specific or recreational purpose,” says Environment Minister Dr Nick Smith.

“We want to improve community and iwi involvement in marine protection and develop a comprehensive network of areas that better protects marine life and which enhances New Zealanders’ enjoyment of our marine environment.” . . 

Seafood industry supports sustainable fisheries:

The seafood sector supports effective marine conservation, its Chief Executive Tim Pankhurst said today.

He was commenting on today’s release of a consultation document on a new Marine Protected Areas Act to replace the Marine Reserves Act 1971 that includes proposals for recreational fishing parks in the inner Hauraki Gulf and Marlborough Sounds.

The proposals would cut commercial fishing in the proposed areas. . . 

Easing NZ Dollar Helps Lift Local Wool Market:

New Zealand Wool Services International Limited’s C.E.O, Mr John Dawson reports that the first sale after the Christmas break of approximately 13,700 bales from the North Island saw a generally firmer market in local terms with 98.5 percent selling.

The weighted indicator for the main trading currencies eased 1.3 percent compared to the last sale on 17th December, however compared to the US dollar the New Zealand was back 1.9 percent. This weakening NZ dollar underpinned the market for most types. . . 

Grow Food, Not Lawns's photo.


Rural round-up

November 28, 2015

Trade agreement opens door for agricultural exporters:

The Trans-Pacific Partnership has dominated media recently, but a Lincoln University expert says an equally significant trade-related development has gone largely unnoticed.

Agribusiness and Commerce lecturer Eldrede Kahiya said the Global Procurement Agreement (GPA) – which New Zealand became part of in August – opened up a $2.65 trillion-dollar market for New Zealand exporters.

Dr Kahiya said the GPA came within the framework of the World Trade Organization, and was designed to make it easier to compete for foreign government contracts. . . 

Livestock antibiotics to be replaced with vaccines by 2030:

Antibiotics for livestock are likely to be replaced with various vaccines by about 2030, and the value of New Zealand meat exports will grow because of the switch.

That growth was among the findings in a new report by the Veterinary Association, which shows the antibiotic era was coming to an end because of a growing resistance to them.

A consultant for the Association, Eric Hillerton, said antibiotics would still exist but they would not be a first choice in animal health. . . 

Slight drop in production keeps focus on high value products:

Westland Milk Products says its 2.5 percent drop in peak milk processing has meant more capacity available for the co-operative and its shareholders, enabling more focus on added-value product.

Chief Executive Rod Quin today confirmed that Westland hit peak mid November. In total, Westland processed 3,843,250 litres of milk by peak flow, compared with 3,931,022 the season prior.

“This slight drop, combined with our new dryer seven coming into commercial production meant we had greater capacity to put more of the peak milk flow into higher value products,” Quin said. “In previous years peak milk has all been channelled into bulk milk powders to maintain throughput, which give a lower return compared to products such as infant formula. . . 

Peter Tate makes the case for the broker and auction based system to sell New Zealand’s wool – Peter Tate:

New Zealand agriculture efficiently produces large volumes of commodities and while it would be great to have a stake in all the added value from the front end of the commodity chain, the large amounts of capital both intellectual and financial required, makes it difficult to achieve.

There are some companies that seek publicity about sales contracts they have made. That’s fine but often the fanfare is over a very small volume of product. This distorts the view growers have of marketing to the point that they think these companies are the only ones doing anything to market the NZ wool clip.

The real exporters, those with the long track records, continue to stay out of the limelight. This is due to what is called commercial sensitivity, it is an extremely competitive business. More cut throat than meat marketing, hence the old Yorkshire phrase “meaner than a mill boss”. So the firms who are selling and shipping  90% of the NZ clip remain tight lipped about their daily deals. . . 

RSE employers praise seasonal worker scheme:

Immigration Minister Michael Woodhouse says two recent reports show the huge benefits of the Recognised Seasonal Employer (RSE) scheme to employers, workers and the Pacific region.

A report into a pilot project involving 640 Tongan and Samoan RSE workers has found that they sent home more than 40 per cent of their take-home income between November 2014 and June 2015 –an average of between $4,600 and $5,500.

“Remittances have been playing an increasingly important role in reducing the scale and severity of poverty in the developing world,” says Mr Woodhouse. . . 

Praise for seasonal employment scheme:

Experience confirms two recent reports showing huge benefits from the scheme to employers and workers, the Rural Contractors Association says.

Immigration Minister Michael Woodhouse released the reports in which employers continued to praise the scheme, with an annual survey showing 95 percent believed the benefits of participating in the scheme outweighed the costs.

Rural Contractors President Steve Levet said it had made great inroads into being able to bring in seasonal machine operators to alleviate a shortage of labour in that area. . . 

Sound science point of difference for Waipara winemakers:

More than two decades of soil science work in the Waipara area has been brought together in a document launched at a Vineyard Soils Day at Black Estate Vineyard this week.

The document was received with enthusiasm as an invaluable resource by local wine growers, who acknowledged the potential for far greater collaboration in research initiatives between wine growers and Lincoln University.  

Former Lincoln University soil scientist Dr Philip Tonkin, Associate Professor Peter Almond, current Head of the Soil and Physical Sciences Department, Trevor Webb from Landcare Research, and other scientists, have spent the best part of the last two years drawing together available information on the geology and soils of the region gathered in the last 20 years, along with the records of former Soil Bureau surveys. . . 


Quote of the day

August 24, 2015

. . . But I’m also sure that we can write all the rules and regulations we like. What is going to make the step change in our workplaces is different attitudes and different behaviours. And that’s going to involve all of us, not just the health and safety rep with the high-vis vest. Every single person in the workplace has got to contribute to that. Michael Woodhouse

 


NZ open for business and people

July 27, 2015

Prime Minister John Key today used his speech to the National Party conference yesterday to reiterate his Government’s commitment to an open economy which embraces free trade and immigration.

. . . Earlier generations could never have imagined the global opportunities opening up for New Zealand.
I want to lead a country that embraces those opportunities.
An open and confident country that backs itself on the world stage.
As I’ve said many times, we won’t get rich selling things to 4.5 million New Zealanders.
But we could by selling to 4.5 billion people overseas.
Our Party supports strong international connections.
We value the benefits that free trade agreements deliver and the opportunities they offer.
I back our farmers, our manufacturers, our ICT companies and in fact all our export industries to succeed.
If we can get an equal crack at world markets, we’re up there with the best in the world.
That opportunity is what free trade is about for New Zealand.
When the previous Government, with the full support of National, signed a free trade agreement with China in 2008, our annual exports to that country totalled $2.5 billion.
Since then, they’ve quadrupled and China is now our biggest trading partner.
That FTA has had huge benefits for New Zealand.
Just a few months ago, I was in Seoul to witness Tim Groser signing another free trade agreement – this time with Korea.
When that agreement comes into force, half our exports to Korea will immediately be tariff-free, and almost all the rest will follow.
I can tell you that the kiwifruit growers of Te Puke are going to be delighted when the 45 per cent tariffs they currently face are finally removed.
We’re also in the final stages of negotiating the Trans-Pacific Partnership Agreement.
TPP has been a big focus for our Government.
A successful conclusion will mean a trade agreement with a number of countries, including the giant economies of the United States and Japan.
This is something that successive governments in New Zealand, of both stripes, have been actively pursuing for many years.
That’s because it will mean better deals for Kiwi producers and exporters, better access to world markets, and better prospects for growing those markets in the future.
It will help diversify the economy through a broader range of trade and investment relationships.
And it will flow through to higher incomes and more jobs for New Zealanders.

The ability to export freely and earn the returns from exports unhampered by tariffs and other protective measures is one part of our international connectedness.

Immigration is the other.

New Zealand’s connectedness with the world is also about people coming to New Zealand to live and work.

Immigration benefits New Zealand because people coming here provide more of the labour, skills, capital and business links we need to grow.
A lot of people coming to New Zealand settle here in Auckland.
But as I go around other parts of New Zealand, mayors and employers often tell me they can’t get enough workers of the type local businesses need.
Southland, for example, is always crying out for workers in the dairy sector.
Across the whole South Island, in fact, the unemployment rate is a very low 3.6 per cent.
I can assure people that New Zealanders will always be first in line for jobs. That will not change.
And Auckland, as our largest city, will continue to grow.
But I believe we can do a better job of matching the needs of regions with available migrants and investors.
So today I’m announcing some changes to our immigration settings.
The first is aimed at encouraging people who come to New Zealand as skilled migrants to take up jobs in in the regions.
Around 10,000 skilled migrants get residence each year, together with their family members, and almost half of them come to Auckland.
We want to balance that out a bit, by attracting more people into other parts of the country to help grow local economies.
Currently, skilled migrants with a job offer get 10 extra points if that job is outside Auckland, and those points count towards the 100 they require.
From 1 November, we will treble that, and give them 30 extra points.
In return, they’ll have to commit to a region for at least 12 months – up from the current requirement of three months.
New Zealand also needs entrepreneurs to start new businesses, expand existing firms and create jobs.
So the second change we’ll make is to encourage entrepreneurs wanting to come to New Zealand to look for business opportunities in the regions.
Last year we launched an Entrepreneur Work Visa, targeting migrants who offer high-level business experience, capital and international connections.
Currently, people applying for this visa get 20 extra points if they set up a business outside Auckland, and that counts towards the 120 they require.
From 1 November, we will double that to 40 extra points.
Immigration New Zealand expects to approve up to 200 people next year under this visa.
With the changes we’re making, we expect to see most of these entrepreneurs setting up or growing businesses outside Auckland and creating new jobs across the country.
The third change I’m announcing will help employers find out faster whether New Zealanders are available to fill a particular vacancy, before they lodge a visa application with Immigration New Zealand.
From 1 November, they’ll be able to contact Work and Income directly to check availability.
This is a small measure, but it’s been really appreciated by employers in Queenstown and we’re extending it across the country.
The fourth announcement I want to make today is that the Government intends to provide a pathway to residence for a limited number of long-term migrants on temporary work visas in the South Island.
These people and their families have been in New Zealand for a number of years.
Their children are at schools. Their families are valuable members of their communities. And they are conscientious workers paying their taxes.
Their employers want to hold onto them because there aren’t enough New Zealanders available.
Around 600 overseas workers in lower-skilled occupations in the South Island have been rolling over short-term work visas for more than five years.
We envisage offering residency to people in this sort of situation, who commit to the South Island regions where they’ve put down roots.
We’ll set out the details of this pathway early next year.
Finally, the Government will consider a new global impact visa.
This would be targeted at young, highly-talented and successful technology entrepreneurs and start-up teams, who want to be based in New Zealand, employ talented Kiwis and reach across the globe.
There’s been quite a bit of interest in this idea and we’re going to look at it carefully over the next few months.
Ladies and Gentlemen.
Taken together, the changes I’ve announced today will contribute to a better balance in our immigration settings.
They will help spread the benefits of migration across the country, particularly in those regions crying out for workers, skills and investment.
As I said earlier, we need to be more connected with the world, because that’s where our opportunities come from.
This is just one small part of that approach.
We’ll also continue to press on with free trade agreements, build stronger investment links, and embrace the openness and connectedness that characterises successful countries in the 21st Century. . .

Immigration Minister Michael Woodhouse said:

. . . “Thousands of people from all over the world are moving to New Zealand because it is a good place to live, work and raise a family,” Mr Woodhouse says.

“Those people make a significant contribution to New Zealand’s economic growth by providing skills, labour and capital we need, along with valuable cultural and business links.

“New Zealanders will always be first in line for jobs and that won’t change,” Mr Woodhouse says.

“Currently, many new migrants settle in Auckland, which faces infrastructure challenges as it transforms into a truly international city. At the same time, business owners in other parts of New Zealand often struggle to find enough skilled workers to meet their demands.

“While there are already incentives to encourage migrants to move to areas outside of Auckland, we can do a better job of matching the needs of regions with available migrants and investors,” Mr Woodhouse says.

New measures to take effect from 1 November include:

  • Boosting the bonus points for Skilled Migrants applying for residence with a job offer outside Auckland from 10 to 30 points.
  • Doubling the points for entrepreneurs planning to set up businesses in the regions under the Entrepreneur Work Visa from 20 to 40 points.
  • Streamlining the labour market test to provide employers with more certainty, earlier in the visa application process.

In addition, from mid-2016 a pathway to residence will be provided for a limited number of long-term migrants on temporary work visas in the South Island.

“Unemployment across the Mainland is nearly half that of the North Island, and labour is in short supply,” Mr Woodhouse says.

“Most workers in lower skilled jobs must apply to renew their work visas every year. Some of these people have worked hard and paid tax to New Zealand for many years. They are valued at work and in their community, but have no avenue to settle here permanently.

“We’re looking at offering residence to some migrants, who have applied at least five times for their annual work visa. In return, we will require them to commit to the South Island regions where they’ve put down roots.”

These are very welcome changes which will make it easier for immigrants to settle in the regions and for employers in the regions to attract and retain staff.

I know a family who will benefit from the new policy to allow people on temporary visas who’ve been here for at least five years to settle.

They’ve been here for a decade, working, paying tax and contributing to the community.

They’ve spent 10s of thousands on immigration consultants but don’t have enough points to gain residency.

They are good people who would make good citizens and now they will be able to stay in the place they call home.

That’s good for them and the small town where they live.

Mr Woodhouse says the Government is also considering a new Global Impact Visa to attract high-impact entrepreneurs, investors and start-up teams to launch global ventures from New Zealand.

“I will announce further details later this year, but we envisage this visa would be offered to a limited number of younger, highly talented, successful and well-connected entrepreneurs from places like Silicon Valley,” Mr Woodhouse says.

This announcement shows National is open to business and people, a policy from which we’ll all benefit.


Bank, govt aim at demand, what about supply?

May 18, 2015

The Reserve Bank and the government are both trying to take the heat out of the Auckland housing market.

The Bank announced proposed changes to the loan-to-value ratio (LVR) policy to take effect from 1 Octobere:

They will:

  • Require residential property investors in the Auckland Council area using bank loans to have a deposit of at least 30 percent.
  • Increase the existing speed limit for high LVR borrowing outside of Auckland from 10 to 15 percent, to reflect the more subdued housing market conditions outside of Auckland.
  • Retain the existing 10 percent speed limit for loans to owner-occupiers in Auckland at LVRs of greater than 80 percent.

The government is  taking extra steps to bolster the tax rules on property transaction.

FInance Minister Bill English and Revenue Minister Todd McLay say the Government is taking extra steps to bolster the tax rules on property transactions – including those by overseas buyers – and to help Inland Revenue enforce them.

The tax measures are also expected to take some of the heat out of Auckland’s housing market and sit alongside the Reserve Bank’s latest moves to address associated financial stability issues, Mr English says.

“Taken together, they will help Inland Revenue enforce existing tax rules, provide it with extra resources and ensure that property investors pay their fair share of tax – whether they’re from New Zealand or overseas.”

The Budget this week will confirm that, from 1 October this year, the following will be required when any property is bought or sold:

  • All non-residents and New Zealanders buying and selling any property other than their main home must provide a New Zealand IRD number as part of the usual land transfer process with Land Information New Zealand.
  • In addition, all non-resident buyers and sellers must provide their tax identification number from their home country, along with current identification requirements such as a passport.
  • And to ensure that our full anti-money laundering rules apply to non-residents before they buy a property, non-residents must have a New Zealand bank account before they can get a New Zealand IRD number.
  • In addition, a new “bright line” test will be introduced for non-residents and New Zealanders buying residential property, to supplement Inland Revenue’s current “intentions” test. Under this new test, gains from residential property sold within two years of purchase will be taxed, unless the property is the seller’s main home, inherited from a deceased estate or transferred as part of a relationship property settlement.

“Tax rules are complex and affect people in different ways, so we will consult on these measures before they take effect on 1 October,” Mr English says.

The “bright line” test will then apply to properties bought on or after 1 October.

To further ensure overseas property buyers meet both existing tax requirements and those of the new test, the Government will investigate introducing a withholding tax for non-residents selling residential property.

Officials will consult on these details with a view to this withholding tax being introduced around the middle of 2016.

Mr English reiterated owner-occupiers of residential property will not be affected by the new measures when they sell their main home, or if property is inherited from a deceased estate or transferred as part of a relationship property settlement.

“It’s important to reiterate that these changes will not apply to New Zealanders’ main home, although existing tax rules will still apply in  addition to these new measures,” Mr English says.

“It’s equally important that people buying residential property for gains meet their tax obligations, whether they are from New Zealand or overseas.

“The combination of collecting IRD numbers and introducing this new bright-line test will help ensure that non-residents pay their fair share of tax in New Zealand.” . . .

New Zealand National Party's photo.

These measures should go someway to dampening the demand side of the pressure on Auckland property prices.

More needs to be done to increase the supply of houses.

This could be done by building more houses and by people moving from Auckland to other areas.

Immigration Minister Michael Woodhouse is considering incetivising immigrants to settle in the regions:

The Government is set to give skilled migrants, investors and those planning to bring businesses to New Zealand extra points if they settle outside of Auckland.

Skilled migrants and those applying to live in New Zealand under entrepreneur visas already gain 10 points in the immigration points system if they say they intend to settle outside of Auckland. That could soon get a boost.

“Those entrepreneurs, those innovators who could make a contribution to regional development, it is possible for us to bump up the points settings to incentivise that,” says Mr Woodhouse. . .

 It’s not just immigrants who could make a contribution to regional development.

If some of those bemoaning property prices in their home city opened their eyes to opportunities outside Auckland they could move out of Auckland.

They would get a house for much less than they could hope to pay in the city, find how much easier life is when there are fewer people clogging the roads and in improving their lives would free up houses in Auckland for those who can’t or won’t move.


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