Taxpayer Update: Kainga Ora's Failures 🏠🔥 | Auckland Tramway Scrapped 🚆✖️ | Our Own Misinformation Project 🇦🇷🤥

January 20, 2024 Connor Molloy

As you'll see that while many politicians (and just about all the Wellington bureaucrats!) are enjoying long holidays, our team are back at work exposing waste, fighting for more more taxpayer victories, and promoting sensible improvements for how your money is spent.

Thousands of Brand New State Houses Sitting Empty 🏠🔥

Despite the state housing waitlist being more than 30,000 people long, thousands of brand new state houses have been sitting empty, some for months at a time. Taxpayers spent millions on building and purchasing these properties, so they should be filled rather than left to collect dust.

Of course, the wider issue is the state of bureaucratic regulation in the housing sector that effectively makes it illegal to build a cheap house. The chaotic mess of red tape creates unworkable, unnecessary and ineffective restrictions on building and renting homes. This drives up the costs of housing and forces people onto that waitlist.

It is clear that big and centralised government is not good at getting people into affordable housing. It is a scandal that for a country with a small population, and plenty of land, housing is among the most expensive in the world.

The new government has talked a good talk on cutting red tape and simplifying our planning laws such as the Resource Management Act. This year, one of our major focuses will be on ensuring they follow through. New Zealand cannot afford another generation without access to affordable housing, both for renters, and those who want to build or buy.

In terms of social housing, rather than trying, yet again, to fix Kāinga Ora and its centralised model, we say the Government should be focused at enabling (including funding) local community groups to provide both high quality housing and social services as they are likely to deliver far better value for the taxpayer long term.

Because empty houses is not the only failure happening at Kāinga Ora...

Kāinga Ora's $2 Million Cost Blowout on Ridiculous Housing Project 🚧🧱

You would think that, to the extent to which central government should be responsible for building houses, they would actually build them in areas where they are most needed and have appropriate social services nearby. Think again...

On Thursday, we called out a cost blowout on a state housing development that shows everything wrong with Kāinga Ora. The development which would create 44 residential houses in Ohakune was originally intended to cost $5.2 million but has since blown out by 44% to $7.5 million. This supposedly post-COVID lockdown 'shovel-ready' project has been in the pipeline since 2020 yet four years later we are yet to see a single shovel hit dirt!

The cost blowout comes as no surprise given the Auditor-General slammed the 'shovel ready' slush fund for its poor decision making and continuous wastage of taxpayer money.

There are countless reasons why this project should never have been approved in the first place. For a start, approving a 44-house development in a small town where there are only 11 families in Ohakune on the housing waitlist, is questionable when thousands of people remain in taxpayer funded hotels temporary housing across the country. Surely a development of this scale should go where it is most needed?

To make things worse, Ohakune has virtually no social services and no local GP so the wrap-around services that will be needed for some of these families will simply not be available.

The funding for this project was originally tuned down twice due to its unviability with one of the early due diligence reports deeming it a "no go". But when COVID came along, the bureaucrats hit 'go' anyway.

It is clear that things are seriously bad at Kāinga Ora. We understand that the new Minister, Chris Bishop, has written to them outlining his expectations but if things don't turn around soon, the Board will be sacked. Good.

The Taxpayer-friendly "Disinformation Project": Stop Bureaucrats from Describing Taxpayer-Funded Services as 'Free' 🇦🇷🤥

Too often Government agencies mislead the public and disrespect taxpayers by claiming that many public services are ‘free’, when they are in fact taxpayer-funded.

Whether it is 'free' prescriptions, 'free' first year university, or 'free' healthcare, the truth of it is that the money needs to come from somewhere – you the taxpayer.

While there are strong arguments for the taxpayer to cover the costs of some services up front, to dishonestly label those services as free is disrespectful to the hardworking Kiwis footing the bill. It is political disinformation, and it's time it stopped.

So, hot on the heels of a similar proposal from new Argentinian President Javier Milei, the Taxpayers' Union this week launched a petition calling on the Government to ban public servants from using the word 'free' when referring to taxpayer-funded institutions.

Words matter. Every election we see politicians trying to bribe voters with promises of "free this", or "free that" but, at the end of the day, there is no such thing as a free lunch. We suspect that if they said taxpayer-funded instead, we would see a lot more people looking at these policies with a critical eye.

Of course, political parties can campaign however they like (that's why we work so hard to counter the political spin-doctors during the election campaign) but once a party is in Government, they must communicate truthfully and transparently with taxpayers. If we can't trust the government to be honest, public trust in our democratic institutions is eroded.

Join the call for honesty by signing the petition here.

Auckland Dominion Road Trams Scrapped – Saving $15,000 per Household 🚆✖️

This week we also celebrated the Government finally pulling the plug on Auckland Tramway, sorry, "Light Rail", which saw hundreds of millions of dollars of taxpayer money wasted with absolutely nothing to show for it.

Since its inception, the tramway has racked up a near quarter of a billion-dollar bill in consultant fees and building purchases, yet in all that time we still didn't see a single metre of track being laid!

In the midst of a cost-of-living crisis, there was simply no justification for the Government to continue reaching deeper into Kiwis pockets, especially when the budget was only continuing to skyrocket. Advice to the Minister showed costs could reach as high as $29.2 billion, or $15,000 for every household in the country!

This is a necessary first step from the Government in what we hope will be further moves to tighten its belt and cut back on wasteful pipe-dream projects. But if the new coalition is really serious about slashing waste, it needs to address another glaring problem, which is how these non-roading initiatives continue to raid the National Land Transport Fund (NLTF).

We’ve long called for the NLTF, which is funded by fuel taxes and road user charges, to go back to funding exclusively what it is actually meant for: roading infrastructure. We're calling on the Government to properly ring-fence the fund, and ensures it does not continue to be pillaged for projects irrelevant to the purposes of our roading network, such as rail and cycleways. More to come on this in the coming months...

Farewell to our Australian Intern, Rhys Budge 👋🇦🇺

Last year, Rhys Budge jumped across the ditch from Australia to join us for a couple of months on an internship thanks to a bursary from our friends at the Mannkal Economic Education Foundation, a freemarket organisation in Perth.

Rhys has been a fantastic addition to the team who has been involved in a wide range of research and investigations tasks during his time here. Rhys was responsible for research and producing our Nanny State Approved Christmas Feast report and has written another soon to be released reports on MP pay and the eye-watering costs of government branding and website 'refreshes'.

Rhys heads back to Australia to finish his studies in economics and finance and we know he will go on to do great things. We wish him the best of luck!

Rhys has written a blog post about his time at the Taxpayers' Union which you can read here.

Support the Next Generation of Fiscally Prudent Political Leaders 🧒🧠

As someone who started at the Taxpayers' Union as an intern, I know the value of being able to learn about and apply 'radical' ideas such as democratic accountability, transparency, and limited government.

Being a student in a city like Wellington, the Taxpayers' Union internship allowed me to escape the echo-chamber of thought that plagues universities and is an opportunity for free discussion, lively debate, and being part of a great team.

Unlike the political parties (we're looking at you Labour!), we pay our interns. And, as you will see in the coming weeks from some of Rhys' work, they produce great research that holds the government to account and exposes government waste.

If you would like to support the Taxpayers' Union internship programme, you can chip in to help fund an intern here.

Other News in Brief ⏰

We welcomed the news that road user charges will finally be added to electric vehicles, making the system fairer and ensuring that those who use the roads pay for the damage they cause. Those driving fuel-powered vehicles should not be forced to subsidise (often more affluent) EV road users – especially when (contrary to what you'd see in the media!) electric cars don't actually reduce New Zealand's overall emissions (see my explainer video here).
The Independent Electoral Review released their report on how to improve the electoral system which included recommending that the voting age be lowered to 16, it be made legal to bribe voters with refreshments and entertainment and that political parties be given even more taxpayer funding. We slammed the review and pointed out that taxpayer funding for political parties erodes democracy, favours incumbents and is morally unjustifiable.

Callum is back from seeing his family Scotland this weekend, so it'll be my turn to take some summer leave. I've enjoyed leading the campaign team over the holidays and can't wait for more policy wins this year.

Thanks for your support,