Latest news with #governmentintervention
Yahoo
a day ago
- Business
- Yahoo
Failed New Zealand scheme is cautionary tale for Carney's homebuilding agency: report
OTTAWA — Researchers with the Montreal Economic Institute say Canada's new federal homebuilding agency is likely to overpromise and underdeliver, drawing a cautionary tale from down under. The free-market think tank argues in a new study that New Zealand's now-defunct homebuilding scheme KiwiBuild, a signature policy of Jacinda Ardern's Labour government, shows why government bureaucrats shouldn't try to play real estate developer. 'New Zealand's experience highlights the limits of government intervention in the real estate market, especially in terms of resource allocation,' write co-authors Gabriel Giguère, Yassine Benabid and Renaud Brossard. Brossard told the National Post he was struck by the similarities between KiwiBuild and the Liberal government's Build Canada Homes. 'If you look at government programs that have been done throughout the world, this is probably the closest thing to what (Prime Minister) Mark Carney's pitching,' said Brossard. KiwiBuild launched in 2018 with the lofty goal of building 100,000 affordable housing units in a decade. It would never come anywhere near meeting this target, completing just 2,389 units by the end of its last full year of activity in 2024. The program was slammed by both politicians and pundits as a 'complete disaster', contributing to Ardern's fall from global progressive darling to her abrupt resignation in early 2023. By one estimate, KiwiBuild would have taken 436 years to hit the original target of 100,000 homes. Brossard said that one critical mistake that KiwiBuild administrators made was relying too heavily on prefabricated homes. 'In some of the areas where they were hoping to build homes for (KiwiBuild), they found that shipping in a prefab home was actually more expensive than just building one in situ,' said Brossard. Carney has promised billions in subsidies to prefabricated and modular home builders, as part of his plan to double the rate of housing construction and build 500,000 new homes a year within a decade. Brossard and his co-authors report that KiwiBuild's prefab homes were often inferior to other housing options available to low and moderate-income families. Some banks were even hesitant to approve mortgages for the prefab homes, given the 'flight risk' involved where delinquents could theoretically load the units onto a truck bed and skip town. Brossard says that the big lesson from KiwiBuild is that civil servants should leave the nuts and bolts of real estate development to the professionals. 'This is what tends to happen with top-down government programs that push one-size-fits-all solutions,' said Brossard. The study recommends that Carney scrap Build Canada Homes and instead focus on creating a friendlier regulatory environment for private real estate developers. Brossard also said that policymakers can stimulate homebuilders by harmonizing professional qualifications for workers in the building trades across provinces and territories. The office of federal Housing Minister Gregor Robertson didn't respond when asked about KiwiBuild by the National Post. National Post Gary Berman: Common-sense solutions to address the housing shortage Developer makes his pitch: Renting our way out of the Canadian housing crisis Our website is the place for the latest breaking news, exclusive scoops, longreads and provocative commentary. Please bookmark and sign up for our politics newsletter, First Reading, here.
National Post
2 days ago
- Business
- National Post
Failed New Zealand scheme is cautionary tale for Carney's homebuilding agency: report
OTTAWA — Researchers with the Montreal Economic Institute (MEI) say Canada's new federal homebuilding agency is likely to overpromise and underdeliver, drawing a cautionary tale from down under. Article content The free-market think tank argues in a new study that New Zealand's now-defunct homebuilding scheme KiwiBuild, a signature policy of Jacinda Ardern's Labour government, shows why government bureaucrats shouldn't try to play real estate developer. Article content Article content Article content 'New Zealand's experience highlights the limits of government intervention in the real estate market, especially in terms of resource allocation,' write co-authors Gabriel Giguère, Yassine Benabid and Renaud Brossard. Article content Article content Brossard told the National Post he was struck by the similarities between KiwiBuild and the Liberal government's Build Canada Homes. Article content 'If you look at government programs that have been done through out the world, this is probably the closest thing to what (Prime Minister) Mark Carney's pitching,' said Brossard. Article content KiwiBuild launched in 2018 with the lofty goal of building 100,000 affordable housing units in a decade. It would never come anywhere near meeting this target, completing just 2,389 units by the end of its last full year of activity in 2024. Article content The program was slammed by both politicians and pundits as a 'complete disaster', contributing to Ardern's fall from global progressive darling to her abrupt resignation in early 2023. Article content Article content By one estimate, KiwiBuild would have taken 436 years to hit the original target of 100,000 homes. Article content Brossard said that one critical mistake that KiwiBuild administrators made was relying too heavily on prefabricated homes. Article content 'In some of the areas where they were hoping to build homes for (KiwiBuild), they found that shipping in a prefab home was actually more expensive than just building one in situ,' said Brossard. Article content Carney has promised billions in subsidies to prefabricated and modular home builders, as part of his plan to double the rate of housing construction and build 500,000 new homes a year within a decade. Article content Brossard and his co-authors report that KiwiBuild's prefab homes were often inferior to other housing options available to low and moderate-income families.
Yahoo
19-06-2025
- Business
- Yahoo
Environment Secretary steps up plans to nationalise Thames Water
The Environment Secretary has said the Government is stepping up plans to temporarily nationalise Thames Water after a US rescue bid collapsed. Steve Reed confirmed to Parliament on Thursday that ministers were ready to save the struggling utility giant if necessary. A rescue would be in the form of a taxpayer-backed special administration scheme. He said: 'The company remains financially stable, but we've stepped up our preparations and stand ready for all eventualities, as I've said before, including a special administration regime if that were to become necessary.' A government intervention appears increasingly likely after US private equity giant KKR abandoned a bid for the company. Thames's creditors have proposed an alternative £17bn rescue plan but it is contingent on regulators agreeing to waive historical fines. They have been pushing for ministers to intervene on the matter. Mr Reed signalled this would not happen, casting doubt over hopes of a private sector-led solution. He said: 'Thames Water must meet its statutory and regulatory obligations to their customers and to the environment. It is only right that the company is subject to the same consequences as any other water company.' Taking control of Thames would pile further strain on the Government's stretched finances. A previous report estimated that a state bailout would cost the taxpayer up to £4.1bn. Thames, which has 16m customers across London and the South East, has been pushed to the brink of collapse as it struggles under the weight of £16bn in debts. Creditors have said that a 'regulatory reset' is needed to ensure the company is financially viable. A source close to the lenders said they were urging regulators 'not to reach back into history' and instead focus on Thames Water's turnaround efforts moving forward. A senior figure involved in the talks told The Telegraph last week: 'I think what it takes is the Government and the regulator coming together – it needs the Environment Department, the Treasury, and even No 10 to say, 'What's the least worst outcome here?'' Thames Water was handed a record fine of £123m in May and the company could be on the hook for more than £1bn in pollution and environmental failing penalties in future, according to creditors. The £17bn support package proposed by creditors includes writing off several billion pounds of debt and an immediate £3bn cash injection. If their deal falls apart, special administration is the most likely outcome for Thames. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
The Guardian
12-06-2025
- Business
- The Guardian
Government to intervene in Croydon council as report warns of ‘financial crisis'
Government commissioners are being sent in to run Croydon council after a report found its finances were 'deteriorating rapidly' and it was heading for effective bankruptcy for the fourth time in recent years. Jim McMahon, the minister for local government, said he would be sending commissioners to run the council until July 2027, describing the local authority as 'one of the most financially distressed councils in the country'. 'The scale of the financial difficulties facing Croydon, the failure of the council to adequately respond to these difficulties and the assurance required moving forward means that a short and sharp reset, with fast action, is required to shift the dial on the council's recovery,' he said in a ministerial statement on Thursday. The council has hit back at the intervention, with the executive mayor, Jason Perry, saying the government, and the external panel which has been monitoring the council since 2020, had not previously told him the council should be taking more action. 'Surely that means we are doing everything possible, and they agree with our actions? We have already made very difficult decisions and in my view the residents of Croydon have felt enough pain,' he said. 'Despite all the improvements that have been delivered by the council and its staff, it appears the government wants to centralise control into the hands of commissioners.' McMahon said the latest report by the panel on the state of the council had found its 'deteriorating financial position, which is not being gripped and tackled adequately by the council, is reaching a financial crisis'. The council was increasingly relying on government support to balance its budget, its operating costs continued to be 'unreasonably high' and its debts were expected to rise to more than £1.9bn by 2029, McMahon said. The council's current debts sit at £1.4bn, and it has received about £553m in exceptional financial support from the government since 2021. Perry said the council had made savings of £167m over the past four years, and had sold off £130m worth of assets, with plans to sell a further £68m this year. Croydon council has declared effective bankruptcy three times since 2020, most recently in 2022 when the situation was blamed on 'unprecedented financial mismanagement, toxic bad debt and a lack of governance and transparency'. It raised council tax by 15% shortly afterwards. Croydon, London's largest borough with nearly 400,000 residents, was second only to Birmingham in the amount of exceptional financial support it got this year – £136m, up from £38m granted to the council in 2024-25. The latest announcement suggests Croydon could follow Birmingham with a series of brutal budget cuts and council tax hikes. Perry said he would not support cuts that would 'decimate local services' or any further council tax increases above the cap of 5% a year. Council leaders have criticised the government for failing to address the hole in local authority finances in Wednesday's spending review. Tim Oliver, the chair of the County Councils Network, said the sums announced 'fall well short of filling the projected £2.2bn funding gap faced by county and unitary councils next year, and consequently further service cuts will be hard to avoid'. Louise Gittins, the chair of the Local Government Association, said many authorities would have to increase 'council tax bills to try to protect services but still need to make further cutbacks'.
CTV News
28-05-2025
- Business
- CTV News
Sask. hotel strike passes 600 day mark
WATCH: Former premier Lorne Calvert is calling for the government to intervene in a hotel strike affecting Moose Jaw and Saskatoon hotels. Wayne Mantyka explains.
