Across the Ditch: Housing Bubble Sees People Living Rough + Planet Key May Play Again

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In this week’s Across the Ditch bulletin Australian radio’s Josh Sampson and’s Selwyn Manning discuss how the soaring costs of housing in New Zealand has driven prices beyond the reach of most Kiwis, and rents well beyond what is affordable for thousands of people. PLUS: The song that was released a month before the 2014 New Zealand election, and then immediately banned by the Electoral Commission, has had its creators back in court, this time the Government’s Electoral Commission has sought to justify it banning the song in the 2014 General Election – this after the High Court decided the song did not fall foul of New Zealand’s electoral law. ITEM ONE: The soaring costs of housing in New Zealand has driven prices beyond the reach of most Kiwis and rents well beyond what is affordable for thousands of people. The problem is at its worst in the cities, particularly Auckland where the average home sale price is almost $1million. The demand for rental accommodation has seen landlords renting out tin garages for around $400 per week, and a 28 square metre chicken-coop apartment will cost you $330.00 per week. Last year, we reported on FiveAA’s breakfast programme that the imbalance in the New Zealand economy, led by a hot property market in Auckland, had worsened and had been in evidence for over a year. We also reported that the Reserve Bank had warned in 2015 that the housing market had ballooned out and posed a significant risk to the entire New Zealand economy. This year, on May 11, the New Zealand Reserve Bank issued another warning, suggesting that if the housing bubble bursts, the impact on the New Zealand economy will be dire: “The Bank remains concerned that a future sharp slowdown could challenge financial stability given the large exposure of the banking system to the Auckland housing market. Further efforts to reduce the imbalance between housing demand and supply in Auckland remain essential.” (ref. Beyond the wider domestic economy, the impact on every day life for thousands of Kiwis is already dire. For weeks now the news has been filled with real life examples of people living beneath the breadline. The state broadcaster, Radio New Zealand, has been leading almost continuously with reports about families living in cars, in tents, in garages, shacks, caravans, sleeping rough. Many of these people are women with children, and many have jobs but simply cannot afford a roof over their heads and have been squeezed out. (ref. Early this week the Prime Minister John Key said people who are sleeping in their cars should contact Work and Income New Zealand – the state social provider that is tasked with assisting families in dire economic circumstances and getting people back into work. But the Minister in charge of Social Housing, Paula Bennett, admitted on Radio New Zealand this week that in Auckland there simply is not enough accommodation available to house those who have nowhere to sleep. She did say her department would be able to put people into motels as a short term fix. However, this week it was revealed, every person placed into a motel by WINZ is then charged at the market motel rate per night. The people who cannot afford rent, are placed into this form of the government’s temporary accommodation find themselves thousands of dollars in debt to the Government. Debt the Government charges interest on. (ref. ITEM TWO: Meanwhile, a song that was released a month before the 2014 New Zealand election, and then immediately banned by the Electoral Commission has had its creators back in court. The song is a parody of the Prime Minister’s comments, a vision of his ideal New Zealand. John Key said: “I do not know so much about Planet Key, but my expectations are that it would be a lovely place to live, it would be beautifully governed. Golf courses would be plentiful, people would have plenty of holidays to enjoy their time. And what a wonderful place it would be.” Kiwi musician Darren Watson and video maker Jeremy Jones released their song in the early stages of the 2014 General Election. Immediately, there was an outcry by those passionate who were that John Key should not be the subject of satire during an election campaign. Then the Electoral Commission moved swiftly to ban the song and initiate legal proceedings against Darren Watson and Jeremy Jones. The two creators decided to take the song off the internet rather than risk facing a $40,000.00 fine. Since then, in the High Court, they have defended their right to create and release such a song, even should it be satire, should it focus on the Prime Minister, and even if the song should be released during a political campaign. The Electoral Commission argued before the High Court that it considered, under New Zealand law, that the song was an election advert (even though no politician or party paid for it to be created or released). But the High Court judge ruled that the song was ok, and did not come under New Zealand’s electoral act, and as such, should not have been banned. While the Government’s Electoral Commission is fighting that judgement in the Court of Appeal, it has conceded that it now does not want to hold the two creators of the song to account, but just wants the courts to clarify the law before the 2017 election year begins. The Court of Appeal will now consider the two arguments. In the meantime, Kiwis can enjoy the parody of John Key’s vision for New Zealand.