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Scepticism on ‘reckless’ state house sale plan

Media Release 29 January 2015

Northland community housing body sceptical about ‘reckless’ state house sale plan

Northland Housing Forum today voiced their strong concern about PM Key’s announcement of a state house sell-off to the Maori and community housing sector.

“The government’s new policy to sell off thousands of state houses does not in any way create new houses, definitely not new houses for the vulnerable. It has a reckless tone to it,” said Northland Housing Forum convenor Tim Howard.

The Northland Housing Forum, active since its pre-establishment phase in 2004 and its launch at Otiria Marae in March 2005, is a network of Maori and community housing providers throughout Te Taitokerau. The not-for-profit heart of the Forum is supported by whanau and families, by various Maori ropu and representatives of hapu, by community groups, health, local government and statutory bodies. The Forum has actively progressed housing issues for whanau, families and communities, for instance in reducing obstacles for Maori land being used for housing, and facilitated central and local government support for not-for-profit housing providers.

“For a range of reasons, this reckless proposal seems to us to be unsustainable, and maybe even set up to fail; then it would provide a window for a substantial sell-off of state houses to the private sector,” Tim Howard said. “The success of this plan is unlikely. The financial model the proposal operates under, the evident lack of readiness of government departments to administer its complexity, the lack of capacity of the not-for-profit Maori and community housing sector, the increased withdrawal of government from support for the sector over recent years – all point to the likely failure to meet the goal of 2000 state houses to be bought by the sector this year, and 8000 by the end of next year.

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“Driving this rushed sell-off are the government’s deeper beliefs – two in particular. That governments should pull back from state housing provision. And that the market will provide. In other words, privatisation is the underlying agenda. Contrary to promises in the election period, this is heading towards the next great state asset sale.”

Northland Housing Forum sees National as having long had a major state housing sell off in their sights. They refer to the stock transfers in the 1970s, but of the two large sell-offs of state housing to communities one was a failure, and the houses had to be returned to the state. In the 1990s they tried to sell off some 20,000 state houses. They note that in 2013 the Minister wrote to the CEO of Housing NZ stating that the numbers of houses would soon be ‘significantly lower.’

“Selling off state houses and privatisation – they are the real agenda. Not meeting families’ needs,” said Northland Housing’s spokesperson.

The Forum points to the range of reasons for numbers of vacant state houses. They identify a set of government practices that have created these vacancies, rather than reduced numbers of needy families. “The numbers of vulnerable and homeless families are still around,” said Tim Howard; “just invisibilised.” These practices include tighter eligibility criteria for people to get on to waiting lists. Shorter waiting lists. The practice of ‘reviewable tenancies,’ with 5000 families now to be removed from state houses. No HNZ social support from HNZ for their tenants – which in our mind means that HNZ is no longer a social housing provider. All these practices just mean these families no longer count, not that their housing needs are being properly met.

The Forum also indicates a crucial problem with this policy is that the Maori and community housing provider sector (particularly here in the North) currently lacks the capacity to buy and administer a significant number of state houses. “Few organisations, even in Auckland but especially in Northland, are ready to buy and manage these numbers of new houses,” said Tim Howard. “There are no substantial contributions to support the running of such housing providers. No direct subsidies to help buy the houses been announced. Key just tells these groups to talk to the banks, while ignoring the tight balancing of budgets they already have to do to survive.”

“We will be listening to the sector this year,” said Paula Bennett on Morning Report today, after having just announced a major policy to dump houses on the sector without consultation. And “we will be growing the sector slowly,” while at the same time promising the rushed sale of 2000 houses within 11 months.

John Key was looking to Australia as a leader in the community housing area. However Carol Croce, CEO of the Community Housing Federation of Australia, is sceptical whether the NZ Government’s proposed model for selling off state houses will work. The financial constraints on the community housing provider would be too great, she said, with rental income having to be used to pay off mortgage rather than ensure viable community housing operations.

Northland Housing Forum pointed to the many problematic factors in this broad brush plan. That the proposal creates no new houses. That the Maori and community housing sector already has plenty of obstacles to survive without extending to buying up state houses, for which it is not ready. That the sector would be forced into competition with their fellow providers and tender the lowest prices. That there will be no effective government financial and practical support for the sector. That the government bodies themselves are not even ready to administer this complex scheme. The Forum also believes that the longer term goal behind this policy is to seriously reduce the government’s provision of housing, and to open that space to the private sector.

“The Australians are sceptical about the viability of this New Zealand government scheme for Maori and community housing providers over this side of the Ditch,” said Tim Howard. “And so are we. Northland and New Zealand whanau and families deserve better.”


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