Our public service is supposed to be politically neutral, but the
pressure from teh top can get fairly heavy - there needs to be active
work within departments that advice is seen to be neutral from a
political persecvtive.

First we had: http://www.radionz.co.nz/news/national/330488/nzers-face-financial-hardship-when-buying-a-house-analysis

Now in many respects that is hardly favourable to the government - it
showed that most New Zealanders would have problems with either
renting or trying to buy a house - and remember this was when they
were still denying there was any housing crisis at all.

But now we have this: http://www.radionz.co.nz/news/political/333326/mbie-ignored-warning-over-housing-affordability-measure

". . . . . .The ministry spent five years developing the housing
affordability measure and released it last month, saying it was the
end result of a "robust" process.

Its initial report assessed housing affordability between March 2003
to June 2015.

It showed two thirds of renters and 80 percent of potential first-home
buyers could not afford their housing costs.

But emails obtained by RNZ show that on 8 May, two days before the
ministry publicly released the measure, the Reserve Bank warned it
should be using a higher mortgage lending rate in its calculations.

The Reserve Bank said it was discontinuing its effective mortgage rate
series, which MBIE was using in the measure, and "this probably wasn't
the best measure to be using anyway".

It said the new customer mortgage rate was "more relevant for
assessing affordability" whereas the effective mortgage rate was "the
average rate on all outstanding mortgages".

Reserve Bank figures show the new customer mortgage rate sits about 1
percent higher than the effective mortgage rate.

In a statement to RNZ, MBIE said it would now change the mortgage rate
used in the measure.

"Bottom line - the interest rate measure is being changed, it's an
experimental statistic which is in development, and MBIE will be
working with the Reserve Bank to develop the new interest rate
measure," it said.

The ministry said it had originally chosen to use the effective
mortgage rate because it covered a longer time period.

The Reserve Bank declined to make anyone available for an interview,
saying it did not want to pick a fight with MBIE in the media.

Labour Party housing spokesperson Phil Twyford said it was
extraordinary the ministry went ahead and launched the measure knowing
it was based on a "fundamental error".

"If you assume there is a 1 percent difference between the rate they
should have used and the rate they actually used ... on a $500,000
mortgage over a 25-year term that would add $3500 in payments to the
bank every year.

"That would make it significantly less affordable and I think it shows
this measure is ham-fisted actually."

Government ministers have claimed the measure is proof housing is now
more affordable than when National came to power - despite house
prices surging over the last nine years."

___ _ _ _ _ _

And that last paragraph is the key issue - government ministers should
have been told about the advice from the Reserve Bank - if they were
then they have deliberately misled New Zealand, but if they weren;t
then MBIE need to answer as to why they shuold not be seen as acting
in a politically partisam way.

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