A policy that may prioritise crops over housing construction is getting attention from New Zealand’s peak local government body.

Local Government New Zealand is cautiously assessing implications of the proposed National Position Statement on Highly Productive Land (NPS-HPL), noting that it traverses a number of complex policy areas including housing affordability and property rights.

Released by the New Zealand Government in mid-August, the statement is intended to protect agricultural land from development by requiring councils to consider the productive capacity of land in their planning and consenting decisions.

LGNZ is the peak body representing New Zealand's 78 local, regional and unitary authorities. It supports the policy’s intent, particularly as it relates to future food security, but notes its potential to conflict with the Government’s urban growth agenda, which is encouraging fast-growing councils to expand home building to tackle the country’s housing affordability crisis.

“We need to carefully assess and balance the trade-offs between protecting highly productive land and enabling cities to grow, because at first glance these two policy frameworks appear to work against each other,” said LGNZ president Dave Cull.

“In places like Auckland and Hamilton, where New Zealand’s housing affordability crisis is most severe, the only place these cities can meaningfully expand greenfield development is in the areas that the NPS is looking to protect.”

“The Government is effectively pitting potatoes against houses, and at first blush we don’t think the discussion document has considered the implications of this sufficiently.”

A further concern is the implications that the NPS-HPL could have for property rights and regulatory takings.

“New Zealand is a democracy built upon property rights, which are one of the key pillars that underpin our open economy,” continued Cull.

“The detail that we’ll want to see is how central government compensates landowners for the loss of their property rights through an instrument such an NPS, or at least lays out a check and balance to ensure natural justice is served.”

“If there is no compensation for these regulatory takings, it could have severe implications for investment confidence around cities.”

“This is a highly complex area and any misstep could have long-lasting implications for ordinary New Zealanders for decades to come, which is why we’re urging the Government to proceed with extreme caution.”