Twyford berates Treasury on Kiwibuild
AUCKLAND: Housing Minister Phil Twyford has called Treasury officials kids ‘‘fresh out of university’’ who have got their figures wrong on the impact of Kiwibuild on residential investment.
Treasury’s half year update had forecast about $5.4 billion of additional investment in the period to 2023 associated with the Government’s housebuilding programme.
In Thursday’s Budget Economic and Fiscal Update 2018, Treasury had halved the figure over the same period to $2.5 billion.
While it said the investment activity was not lost, it believed it would take longer.
‘‘This activity is not lost, but instead a greater proportion is assumed to occur outside the forecast period.’’
Asked how Treasury could have got it wrong, Mr Twyford told reporters: ‘‘I just think some of these kids in Treasury are fresh out of university and they’re completely disconnected from reality.’’
‘‘I don’t agree with Treasury’s numbers. They’ve made some very questionable assumptions,’’ he told reporters yesterday.
‘‘Unfortunately, the bean counters in Treasury are somewhat disconnected from reality. The officials in MBIE, who are much closer to the industry and are actually involved with mak ing Kiwibuild happen, they actually estimate that the impact on investment could be as much as $11 billion for the same period,’’ he said.
Finance Minister Grant Robertson backed Mr Twyford, saying he hadn’t heard Mr Twyford make the comments.
Steven Joyce, finance minister in the previous National government tweeted that Mr Twyford’s comments were ‘‘reasonably high on the arrogance scale’’.
It is not the first time Mr Twyford has clashed with offici als over Kiwibuild.
Last November, he said Treasury had provided incorrect advice to the Reserve Bank which led the bank to say only 5000 houses could be built a year because private activity would decrease as the programme ramped up.
To reach the Government’s total of 100,000 houses in a decade, 10,000 a year need to be built.
National’s housing spokeswoman, Judith Collins, said Treasury was the third govern ment ministry to tell Mr Twyford he was wrong on Kiwibuild.
‘‘Mr Twyford has now been told by the Reserve Bank that the impact of Kiwibuild on residential construction will be offset by a halving of private sector capacity, by MBIE that he won’t deliver the Kiwibuild houses for the $2 billion he claimed and now by Treasury that Kiwibuild is falling apart.
‘‘But he’s arrogantly said all those experts are wrong and he’s right,’’ Ms Collins said in a statement.