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Where did KiwiBuild go wrong?

Newshub logoNewshub 4/09/2019 Zane Small
a sign on the side of a building: Watch: Housing Minister Megan Woods announces the KiwiBuild reset. © Image - Getty; Video - Newshub Watch: Housing Minister Megan Woods announces the KiwiBuild reset.

KiwiBuild has been officially recalibrated, with the Government's remaining promise of 100,000 houses in 10 years axed - so where did it all go wrong? 

KiwiBuild was one of Labour's flagship policies launched in 2012 by then-party leader David Shearer at Labour's annual conference. It was activated after Jacinda Ardern was elected Prime Minister in 2017. 

The plan was to build 1000 homes in the first year, 5000 in the second, and 10,000 the year after. The promise was to have 100,000 houses built within the decade. 

The reality has been way off, with just 258 houses built so far. More than 10,000 have been contracted, but there are only 169 KiwiBuild homeowners to date. 

Labour was criticised from the start over broken promises. KiwiBuild income caps for buyers were confirmed last year, despite a promise there would be none. 

The affordability of the houses was also questioned

Then there were signs the houses were failing to attract buyers. Limited interest in homes in the Queenstown Lakes District sparked calls in November last year for the policy to be scrapped

Newshub revealed in February that no one entered the ballot to buy any of the homes in a Waikato KiwiBuild development. 

The Government has announced that homes in Te Kauwhata, Canterbury and Wanaka that haven't sold will be released to the open market. 

Finance Minister Grant Robertson has since admitted that KiwiBuild houses were built in "places that perhaps there wasn't the demand".

a person standing in front of a building © Provided by MediaWorks NZ Limited

In January, then-head of KiwiBuild Stephen Barclay resigned six months into the role, following a string of complaints against him from employees, contractors and stakeholders.

The interim targets for KiwiBuild were dropped that month by the Prime Minister. She said the flagship housing programme would be "recalibrated". 

It followed then-Housing Minister Phil Twyford admitting that he wouldn't be able to deliver on his promise of 1000 KiwiBuild homes by the middle of this year. 

The KiwiBuild reset was supposed to be launched in April, but it was delayed. It was then supposed to be announced in June, but it was delayed again. 

The original goal of 100,000 houses in 10 years remained at the time. But the Prime Minister refused to stand by it in May. It's now confirmed that promise has been axed. 

In announcing the KiwiBuild reset on Wednesday, Housing Minister Megan Woods said the 100,000 homes goal was "overly ambitious"

Megan Woods et al. in a room © Provided by MediaWorks NZ Limited

In the months that followed the reset announcement January, National's housing spokesperson Judith Collins regularly grilled Phil Twyford in Parliament about the policy. 

She took aim at the Crown underwrite for developers of KiwiBuild projects, a policy that was signed off by Cabinet in August last year. 

It meant the Government paid for any losses incurred by private developers over KiwiBuild houses that didn't sell - a scheme Collins labelled "welfare for developers". 

Newshub revealed on Tuesday that more than $8 million has been spent so far buying back homes no one wanted from developers, and there are 40 homes which have been on the market for more than six months.

Collins recently sparked an investigation into KiwiBuild by the Auditor-General, who will investigate what Collins said was a "suspicious-looking deal" to underwrite houses already under construction in Canterbury and Auckland. 

Collins has repeatedly pointed to the lack of reform in the Resource Management Act (RMA) and planning rules coming from that, as the reason why KiwiBuild isn't working. 

The Government announced plans in July to "overhaul" the RMA to remove "unnecessary complexity" and ensure faster and more responsive land use planning.

As the KiwiBuild policy continued to draw negative attention, Phil Twyford lost his housing portfolio in June in the Prime Minister's Cabinet reshuffle. 

The title was given to Megan Woods, who also holds the portfolios of Energy and Resources, Science and Innovation, and Greater Christchurch Regeneration.  

It is now up to Woods to breathe new life into KiwiBuild in time for the 2020 general election. 

The latest blow to KiwiBuild was the resignation of the programme's head of delivery, Helen O'Sullivan, who is moving to a new chief executive role in Auckland.

KiwiBuild will now include shared ownership schemes, such as rent-to-own, which is part of the Green Party's confidence and supply agreement with Labour. 

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