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$100M Hidden Cost Of Housing Policy Revealed

$100 Million Hidden Cost Of Government Housing Policy Revealed

The hidden cost of the Government’s income related rent policy for state housing tenants has today been put at between $80 and $100 million each year, a cost that will be borne by taxpayers.

In answer to questions from ACT Housing Spokesman Dr Muriel Newman, Housing New Zealand Chairman, Mike Cashin today told a Parliamentary Select Committee that as well as affecting Housing New Zealand’s credit rating and financial position, Housing New Zealand will need to be compensated for the loss of income from removing market rents.

“The cost of that compensation, using section 7 of the State Owned Enterprises Act, is being put at between $80 and $100 million each year. That money will come out of the pockets of hardworking taxpayers. The Government won’t even know the exact figure that taxpayers will have to fork out until its policy is signed off by Cabinet.

“Labour has concealed this massive burden from New Zealanders, just as they have concealed the unfairness of the whole policy. The income related rent policy makes those low income families lucky enough to live in state houses the winners, and those low income families who cannot get into a state house, the losers.

“In the 1980’s income related rents saw thousands of low income families on waiting lists for state houses. Housing New Zealand today agreed that they were expecting the same problems to arise again once Labour’s policy is in place.

“Why are Labour intent on disadvantaging the majority of low income families while giving special treatment to those in state houses?

“Low income families deserve a fair policy that treats everyone equally whether in private or public housing and gives them support on that basis,” said Muriel Newman.

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