Bill capping development charges passed

Last updated 11:32 30/07/2014

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A bill aimed at bringing down construction costs by limiting fees imposed on developers has passed its final hurdle.

However, a glitch in the Local Government Act Amendment Bill nearly led to it being shelved until after the election.

The bill passed its third and final reading in Parliament last night by 94 votes to 24, with the Greens, NZ First, the Maori Party and Mana opposing it.

The bill restricts the amount councils can charge developers building new subdivisions and limits where those levies can be spent.

The Government says it "paves the way for improved housing affordability and more effective local government".

Critics say it restricts the amount of money councils can raise to pay for community infrastructure and that ratepayers will be left footing the bill.

Associate Local Government Minister Peseta Sam Lotu-liga said the bill was the latest in a range of government measures aimed at bringing down the cost of building.

"The bill includes improvements to the development contributions regime, making them fairer and more transparent," Lotu-liga said.

"This will help keep the costs of building new homes down."

Local authorities would now need to "carefully manage community infrastructure", he said.

The bill also allows councils to limit the amount of community consultations they do.

"This will enable a better balance between cost-effective decision-making and constructive community consultation on the things that are important to the ratepayers of New Zealand," Lotu-liga said.

The bill was almost parked till after the election after Prime Minister John Key said the Government did not have the numbers to pass it.

His remark prompted Labour to say it had not been asked about supporting the bill and that it would vote to pass it.

Labour's housing spokesman Phil Twyford had described the bill as flawed, but said his party would support it because it was "better than nothing".

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