Prime Minister Jacinda Ardern challenged over ‘tempting’ rent increases and ‘skyrocketing cost of living’

“What we have now is not something New Zealand experiences alone. It is an international phenomenon of countries with high rates of inflation. We join the likes of the UK and the US. We also join them for similar reasons – each identifying issues around, for example, construction and housing and in particular the rising cost of fuel prices.

“It’s not something people plan to put up with, but we absolutely accept that it will have an impact on consumers.”

The opposition blamed the rise in inflation on the government’s big spending related to COVID-19. About $60 billion has been borrowed to pay for the response, and Finance Minister Grant Robertson is planning another $6 billion in new spending for the 2022 budget.

Economists agree that stimulus-spurred consumer purchases are a reason for inflation. But it is not that simple. COVID-19 has disrupted supply chains around the world, and when too much money is available to buy too few goods and services, demand outstrips supply, driving up prices.

Ardern said: “The Australian Bureau of Statistics noted that there were high levels of building construction activity and higher global oil prices. The UK Office for National Statistics – this came from housing and fuels The US Bureau of Statistics again pointed out that inflation was caused by gasoline prices, which rose 49.6%.

“I reflect on what we’re seeing around the world. We’re seeing the same trends overseas that we’re seeing here in New Zealand.”

“Cost of Living Crisis”

But that doesn’t change the fact that Kiwis are grappling with the rising cost of living and Greens say it’s time to get rents under control.

Associate Housing Minister Poto Williams gave them hope when she recently said Breakfast it was under study. But Ardern shut it down on Tuesday, telling AM the government was “not planning to control rents”.

Green MP Chlöe Swarbrick asked Ardern in Parliament how she could ‘reconcile her comments that the government is ‘pulling all the levers’ on housing affordability with her statements yesterday that ‘we are not considering control rents “”.

“Because we pull those levers,” Ardern said.

She highlighted the government’s suite of policies in March 2020 aimed at helping first-time home buyers in the market, including the controversial decision to end interest expense tax deductions for rental properties, as Investors accounted for the largest share of buyers in the market and house prices had risen 20% in one year.

He is expected to pocket the government $800 million from the owners.

The government has further cracked down on property investors by increasing the clear line test – the property investment tax – from five to 10 years, but it will be kept at five years for new investment properties to encourage investment property. offer.

The government has also changed the income limits for government deposit assistance, although it does not keep up with inflation.