"...Auckland Council's proposed urban limit policy, the policies underlying a compact city and the political economy of urban policy..."
I suggest you read Cooper's piece for his comments about urban limit and compact city policies. This is what he says about political economy:
"...the political economy plays a defining role in Auckland's urban policy. Housing choice was cut back significantly following community consultation. Improving housing affordability and creating greater housing choice require radically new models of planning. Reduced regulations could be exchanged for greater local amenity, improved levels of service, financial compensation or some combination..."
This is the first time I've seen these ideas discussed by Council staff at this level. In public anyway. I agree with Cooper. But I think he - and council - need to develop this thinking and provide implementation policies and tools that can embody this "radically new model of planning" - which, by the way, is the norm for urban development planning policy in OECD countries that have not been totally taken over by free-market rules.
I penned an OpEd piece for the NZ Business Herald engaging with Cooper's ideas. It hasn't found favour by the editors. Here it is:
Radical Changes Needed in Unitary Plan Political Economy
Auckland Council’s Chief Economist, Geoff Cooper, calls for “radically new models of planning” to improve housing choice and affordability in Auckland, and argues that housing choice was “cut back significantly following community consultation” over the draft Unitary Plan. Significantly, Cooper states that “the political economy plays a defining role in Auckland’s urban policy”.
I agree with him. But does he mean what I think he means with these words?
In the western world political economy is typically concerned with interactions between capital and politics and policy making. Urban political economy focuses on the relationship between local government and capital, both local and global.
A practical understanding of what these interactions and relationships might be in Auckland is assisted by asking a couple of questions: Who governs, and whose interests are being advanced?
More concrete questions include: Do the interests of capital dominate council thinking and exert undue influence in agenda setting and policy making. Are elected councillors and senior officers pawns of capital, or is the relationship more nuanced? For example, do the public’s desires for particular patterns of residential development, work locations, and entertainment preferences set the agenda for capital in a democratic, “invisible-hand” manner?
Cooper – correctly in my view – summarises the three matters that need to be weighed in analyzing the effectiveness of the Proposed Auckland Unitary Plan (Auckland’s urban development policy) that is now out for submissions: its urban limit policy; its compact city policy; and its political economy policy.
Taking these one at a time, I agree that the proposed plan “vastly extends the urban limit”, but the associated political economy settings make it the most attractive or most economically rational choice for developers. At least three market failures are promoted by Auckland Council’ existing policy settings that will incentivise sprawl:
- The first arises from a failure to take into account the social value of open space when land is converted to urban use.
- The second arises from a failure on the part of individual commuters to recognize the social costs of congestion created by their use of the road network, which leads to excessive commuting times for everybody.
- The third market failure arises from the failure of real estate developers to take into account all of the public infrastructure costs generated by their projects.
Additional to the second market failure is the social cost associated with having to travel large distances (compared with compact mixed use development) for life's basic needs including education, shopping, employment and entertainment. Thus, development appears artificially cheap from the developer’s point of view, encouraging excessive urban growth.
Auckland Council’s current compact city policy settings need a radical overhaul. Simplification and removal of regulatory red-tape loomed large on Auckland Council’s list of political objectives that have been delivered in its four unitary plan residential zones. Many economic efficiencies can be claimed from a compact city approach including more efficient use of existing infrastructure, and closer proximity for residents to amenities and employment. It’s a good plan. It’s been successful in other Western world cities. And it can be successful in Auckland. But only if its political economy is recognised and respected.
The Auckland public easily spotted that Auckland Council's combined policy of Special Housing Areas and upzoned urban neighbourhoods was primarily designed to make redevelopment of existing residential properties attractive to developers. Objections have come from existing residents concerned over impacts of taller buildings on their houses, worries about the capacity of existing infrastructure (roads and schools for example), and fears that the value of their homes might drop because of the perceived impact of intensification. All of these fears are well grounded and would have been foreseen had Auckland Council bothered to investigate the political economy of its compact city policies from the public’s point of view.
Council’s compact city policies need to include active community and area planning and investment to compensate for public concerns. Council stands back having created opportunity for the development market who will benefit from the set of market failures that will inevitably ensue:
- The first arises from a failure to take into account the loss in value of the existing sense of community and neighbourhood amenity when urban land is converted from detached residential to intensive use.
- The second arises from a failure on the part of the first-off-the-block developments to pay for (compensate for) the loss of amenity their intensive project is responsible for, while benefiting from the premium of being first.
- The third market failure arises from the failure of real estate developers to take into account all of the public infrastructure costs generated by their projects.
These market failures must inevitably lead to conflict between existing residents and would-be developers. At present Council appears reluctant to recognise this problem, or to do anything about it. Other OECD countries have plenty of examples. These always include explicit public development agency intervention in neighbourhood redevelopment, to get the planning right for the new pattern of land uses, and to build needed infrastructure. Such public actions are either funded by the new development and by a contribution from uplift in property values, or from levies that are charged on greenfield development.
Policy shifts in these directions will begin to correct for current failures in Auckland’s urban political economy.
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