New Zealand needs more housing for the poor, and less fat on the hips of the average Kiwi, according to a report from the OECD.

The country should also look at road tolls in the form of "congestion charging" to help fix traffic jams in the big cities, as reported by Stuff's James Weir.

An OECD report suggests New Zealand should raise the supply of social housing for low income households. Photo: File.

The Organisation for Economic Co-operation and Development is made up of about 30 countries and the international group aims to promote economic growth, prosperity and development.

In its latest report on New Zealand, the OECD's key recommendations included raising the supply of social housing for low income households.

The government should also increase targeted housing subsidies for the poor not in local or central government provided housing.

The government was taking steps to ease shortages of affordable and social housing but needed to go further to make significant headway in rolling back the large burden of housing costs on poor households in recent decades, the report says.

House prices had risen sharply in recent years and were high compared with rents and incomes, the report says. The biggest increases were in Auckland where prices were up more than 16 per cent in the past year according to QV figures out on Tuesday.

The OECD also says New Zealand needs a "comprehensive" approach to reducing obesity, including personal actions, and factors that encourage exercise.

"Obesity, cigarette smoking and poor access to health care have contributed to bad health outcomes for some groups," the report says.

The high levels of obesity and smoking were key risks for higher death rates among Maori, Pacific Islanders and the poor.

To discourage smoking, tobacco taxes have been increased 70 per cent since 2010, taking it to the highest tax rate in the OECD with a further 10 per cent tax rise due next year.

Each 10 per cent tax rise sees the number of smokers fall 5 per cent or more, according to some economists' estimates.

Overall, the OECD report gives New Zealand a tick, with economic growth faster here than most OECD countries in recent years, while inflation remains low.

Employment is "high" with a flexible job market and "ample immigration". Business investment was robust and households and businesses are optimistic.

While "well being is high" there was still a "considerable" income gap with the top half of the OECD.

But bottlenecks in housing, city roads and other infrastructure, inequalities in living standards and rising environmental pressures all posed risks for sustaining growth, the report says.

The report says traffic jams cost the Auckland region about $1.2 billion a year.

"Local and national roads could make greater use of (road) tolls," the report says.

A TomTom traffic index report earlier this year suggested Auckland and Wellington were considered to be the second and third most congested cities in Australia and New Zealand combined, just behind Sydney, comparing the difference between peak and off-peak travel times.

High living standards

New Zealand has one of the highest living standards in the OECD, ranking number seven for quality of life.

Norway is top of the list, just ahead of Australia, while New Zealand ranks between Canada and Finland, with Mexico at the bottom of the table.

All but one of the factors in the "Better Life Index" for New Zealand are above the OECD average. The only blot on the index was for incomes, which were below the average for the developed world economies.

But New Zealand stands out on health, social connections, as well as how much we are engaged with government.

Up till the mid-1970s GDP per capita was relatively high among OECD countries, but it dropped back in the 1980s and 1990s, and remains below average.