"Construction helped to boost the Auckland economy by 2.6 per cent during the March year but unemployment is still high and wage growth remains stagnant."
What the headline disguises is that a growth rate of only 2.6% is only half the annual rate on which the Auckland Plan is based. Auckland has failed in similar fashion for the previous three years, let alone the last three months. The cumulative effect is the underlying reason the city is so badly in debt. Borrowing has been based on vastly over-optimistic growth forecasts for the last four years of 5%pa real growth (i.e. when inflation is excluded). Each year the growth rate underperforms expectations means a cumulative failure of mammoth proportions.
I’ve written about this before. I told the Mayor and Councillors face to face three years ago that the path they were taking Auckland down was suicidal. Mike Lee told me to it was better have a target at the high end of expectations so they could reach for the stars. Well Mike, the stars are falling on your head, your hair's in flames and there isn't a fire engine in sight.
Even worse, the focus on unproductive house building is at the expense of the productive industrial building sector that actually drives the economy.
Looming crisis for Mayor who doesn’t understand the economy
Shortage of Industrial land in UP will have effect of slowing economic growth
Cllr Brewer said: “The chickens are coming home to roost – all the warnings we got when we signed off the Auckland Plan 3 years ago, from the likes of Urbis, the Property Council & others, that we are in a crisis as far as business land goes.
“Not providing enough business land will be a legacy of this council. It should be our bread & butter but it’s not. What is becoming increasingly clear is that an extra ‘1000ha for industrial activities’ over the next 30 years will be nowhere near enough. That is only 33ha of new greenfields land for industrial sites each year. That’s not even the size of the Tank Farm on the waterfront. It’s nowhere near enough to satisfy the insatiable thirst for more land from the Bombay Hills to Wellsford.