Stop-Start Immigration Damaging The Economy

ACT New Zealand Deputy Leader and Immigration Spokesman Dr Muriel Newman today accused the Labour Government of largely causing a crisis of confidence in the New Zealand housing market.

“Immigration is a portfolio that needs to be carefully managed,” Dr Newman said.

“New Zealand needs consistent growth, so that the housing needs of a steady increase in population can be readily catered for.  But, under Labour’s watch, immigration policy has been pushed and pulled from one extreme to the other – with disastrous consequences.

“Latest figures show that, only a decade ago, New Zealand had an average net in-flow of 10,000 per year.  By 2003, however, that had skyrocketed to 40,400 – placing enormous pressure on the housing market, and resulting in a huge building programme to address the demand for affordable housing.

“But a political and public backlash over the escalation in the number of immigrants entering the country led to a knee-jerk reaction from Government: Labour hauled on the brakes.

“As a result, net migration has now halved, plummeting to 17,800 for the 2004 year.  It is projected to drop even further to 12,000 in the year to March 2005.

“It is this – along with rising interest rates, due in part to the Government’s spending of the $7 billion ‘windfall gain’ surplus – that is causing a developing crisis in the housing market.  After adjusting to meet the demand created by Labour’s immigration policy, property owners and investors are now being hung out to dry.

“Private property investors should be mindful that the Government is largely to blame for the current risk to their livelihoods.  By taking a stop-start approach to immigration – rather than a considered, consistent one – Labour is causing harm that the country and the economy could well do without,” Dr Newman said.

ENDS