Heather Du Plessis-Allen speaks with Deputy Prime Minister Grant Robertson on Newstalk ZB on Monday 13 December at 6pm. The BFD Transcript starts 7:25 minutes in.
Heather:
The whole country except Northland has found out today that they will be in the orange traffic light setting from Friday 31st December, that’s New Year’s Eve, Northland will stay in red for the foreseeable and the next full light review is not planned until mid-January. Deputy prime minister Grant Robertson is with us. Hi prime min…deputy prime minister.
Grant:
Good evening, Heather.
Heather:
Just promoted you, apologies for that.
Grant:
(Giggles). No, we will keep that between ourselves – that is not going to be happening.
Heather:
(Laughs). Okay, we’ll take that as confirmation of that then.
Now, why is Auckland staying in red until New Year’s Eve?
Grant:
Yeah, so in Auckland it’s particularly around the status of their outbreak and so we’ve seen really good progress, you know we’re starting to see those daily case numbers trend down but there is still, you know, thousands of active cases to be managed in Auckland and we just want to give a full two ‘two-week cycles’ from when the traffic light framework came in and that takes you to the 30th…31st December. Ahh…and it’s simply, you know, a continuation of our relatively cautious approach here but it is a date that we believe we can meet and that Aucklanders can plan for…that it just makes sure that the full impact of the move to the traffic light framework and the overall outbreak is taken into account.
Heather:
What are you wanting to take into account? What specifically?
Grant:
Just to make sure that we…you know…we continue with the trend that we’ve got with cases reducing, ahh that we don’t see them, you know, spike up, or anything like that.
Heather:
What happens if they spike?
Grant:
Well, it’s highly unlikely that that would happen and so we just want to make sure that we go through the full two cycles of transmission so we are really comfortable that we are in the right position but we have no advice to indicate that will be a problem. Umm…this was the advice of the Director-General; we took it and umm I think it’s the responsible thing to do.
Heather:
So, if the case numbers in Auckland were to increase between now and New Year’s Eve, would you keep Auckland in red?
Grant:
No, not necessarily, umm it would have to be a very dramatic change in direction from where we are now and that is not forecast by anybody. Umm…umm all the epidemiologists are looking at the numbers and can see the downward trend, but we just want to make sure that given there are so many active cases still…and even, you know, even where we were today, 97 cases is still a decent number of cases in Auckland, so we just want to see that come down and that trend continue to come down.
Heather:
Do you agree with the prime minister that you want house prices to drop?
Grant:
Umm… I certainly agree with the prime minister that the growth in house prices that we are seeing now is unsustainable and we…our whole policy platform has been designed around housing to bring those house prices to more sustainable levels so we can’t keep seeing these level[s] of increases.
We’ve got umm most economists still predicting that we are likely to see house price inflation be, you know, in single digits over the course of the next year. That, I know, is hard for people to believe when they’ve seen 27 odd per cent annual increases, but that remains the forecasts of most economists and that’s why we are doing what we are doing with things like interest deductibility, ahh making sure that we extend the bright line test for supply increases that we are putting in place, so that’s why we are doing what we are doing. They are unsustainable and we can’t continue to see them to rise like that.
Heather:
Do you agree with the prime minister that if you saw the house prices come away, you’d be bringing them back to levels that they were a year or two ago?
Grant:
Well, obviously that’s the trajectory that we would be on and how quickly we get there is not something the government controls completely. There are many variables and obviously…
Heather:
What…are you saying that they’re going to come back to prices that they were a year or two ago?
Grant:
Well, they may well, what I’m saying is I am not predicting…
Heather:
When?
Grant:
Well…I am not predicting a number on it but house price inflation that we’ve seen umm…
Heather:
Well, you are predicting a number minister, to be fair. I am going to stop you there because you are predicting a number, because we know full well what house prices were a year or two ago, so when are they going to hit that?
Grant:
Well, if we look at what economists are telling us we are going to be back down to single digits in terms of…in terms of house price inflation over the course of the next year but I’m…you know the government is only one player in this. Ahh…what the reserve bank does matters, other economic conditions matter as well.
And so, we’ve got an agenda to make house prices more affordable. That’s why we’ve made the changes that we’ve made but I am never going to put a specific number on it, forecasters do that and you can obviously look and see where they’re heading.
Heather:
When are house values going to come back to where they were a year or two ago?
Grant:
As I say, I am not going to be able to put a prediction on that. I can tell you that most forecasters say…
Heather:
But you are predicting, I just want to be clear about this. You are predicting that they will go back to that?
Grant:
Eventually. I believe in the trajectory we are on, they will and that’s what most forecasters do as well but I can’t put a specific number on…
Heather:
Do they? Do they?
Grant:
…that without projecting…(unintelligible)
Heather:
You are talking…what you are talking about is catastrophic! We are talking about house values dropping by 30%.
Grant:
No, it’s not.
Heather:
Yes…
Grant:
This is the problem that you…that I said at the very beginning when I agreed with the prime minister that house price inflation needs to come down…
Heather:
No. Min…come on minister!
Grant:
(Unintelligible) Do you want me to read out her exact words from the…
Heather:
Go on then.
Grant:
Ahh…ahh
Heather:
Go on then.
Grant:
The question is: would you like to see house prices come back? Yes, we cannot see the growth in prices that we are seeing now. So, I would like to see a housing market that doesn’t have runaway increases in house price growth, yes. (Unintelligible).
Heather:
The question she was asked was “Would you like to see house prices come back?” and the answer was “Yes”.
Grant:
I don’t think that…
Heather:
Not house price growth, house prices.
Grant:
(Laughing) I don’t think that’s entirely fair because…
Heather:
That’s exactly what it says!
Grant:
No, no, no, no, no, no. no! No, you…you…you can’t…you cannot do that. The sentence says “Yes. We cannot see the growth in prices that we are seeing now.” “So, would I like to see a housing market that doesn’t have runaway increases in house price growth?” Yes.
Heather:
Do you know this is…can you understand…can you understand why the prime minister has reducing credibility in this area – because the mincing and the dodging of words and all this kind of stuff – we look at this and we go “We don’t actually care what she says about stuff anymore because it’s just nonsense.” Does that not worry you?
Grant:
Well, I don’t accept it, Heather, at all. I just think…I disagree with you entirely about that statement. The prime minister has been consistent over a long period of time that the rate of house price growth is unsustainable. That’s the reason why we’ve taken the actions we have, we believe also that the impact of things like LVR changes and the res…what the reserve’s banks trajectory is around the OCR, will have an impact and will bring those back.
That has been a consistent thing that we’ve said.
Heather:
That’s absolutely fine, if that’s how you guys want to play that thing.
The Gisborne checkpoints – do you support them?
Grant:
No, just a minute – I’m not going to stop there. You cannot argue that that answer that I read out is not…
Heather:
Minister, yeah okay. You wanna go down this track further? That’s how…I am happy to, because you’ve opened this up, okay?
The full transcript is: “You would like to see house prices come back?” “Yes”.
Interviewer’s second question: “You want them to fall?”
Answer: “We cannot see the growth continue that we see right now.” There was a full stop after that yes.
Grant:
(Chuckles) The second answer is still pretty material, isn’t it? It’s a follow up question to the same question and it very much relates to the question of house price growth.
Heather:
Grant, that’s fine. If you…I mean we can debate this stuff…we don’t need to debate this stuff. You guys just dig yourselves deeper into a hole – nobody’s even listening to this anymore, that’s the trouble, right?
I want to move onto the checkpoints…
Grant:
No, I don’t agree…
Heather:
Do you support…do you support the Gisborne checkpoints in the same way that you support the Northland checkpoints?
Grant:
What I support are checkpoints that the police run. The police make those decisions when they are working with local people as they have in Northland. I am not aware of any proposal for them to do that in Gisborne.
Heather:
Are you okay if the police start pulling members of the organised crime unit out of their duties and stick them on borders?
Grant:
Well, the decisions that the police make about who goes where are theirs. I am not aware of any proposal to do that.
Heather:
Would you be okay with it if they taking them off the front line dealing with gangs and stuff like that, and chucking them on checkpoints?
Grant:
That’s completely hypothetical. I haven’t heard any…umm…proposal of that nature whatsoever.
Heather:
Well, I can confirm to you the police have confirmed to us that they are doing that. Are you comfortable with that?
Grant:
As I say, police make their operational decisions about how they do things at particular times with the resources they’ve got, and I am not aware of that proposal.
Heather:
All right, thank you very much. I really appreciate it. Deputy prime minister Grant Robertson.
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