Thursday, May 07, 2020

The obvious solution

The government wants to build things to kickstart the economy after the pandemic. Meanwhile, we have a housing bubble and a homelessness problem. Economists are now realising that we can use one problem to solve the other:

A huge programme of social housing development could help vulnerable New Zealanders into homes and support the construction industry, economics consultancy Infometrics says.

Chief forecaster Gareth Kiernan said the waiting list for state houses had more than quadrupled since mid-2015 but high levels of construction activity had made it difficult for the Government to respond with more housing.

Now, with private development likely to be largely on hold through the rest of this year and next, there was a chance to reverse that.

Its a call backed by the Welfare Advisory Group as well, who also want the government to raise wages and push people above the poverty line so that they can spend and keep the economy ticking over. But sadly, the government seems to have abandoned any moves in the latter direction, walking away from its plan for fair pay agreements and better workers rights. Which given the party's name - "labour" - makes you wonder what its MPs think its supposed to stand for.