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Budget sticks a bigger band aid over NZ's housing crisis

26 May 2016

Budget sticks a bigger band aid over New Zealand’s social and affordable housing crisis

The community housing sector says the Government’s budget only partially delivers a meaningful solution to helping New Zealanders in dire need of affordable and social housing.

Community Housing Aotearoa Chief Executive Scott Figenshow says there is some good news in the budget but the Government has not gone far enough to deliver coordinated solutions that work.

“We welcome the allocation Government has made in Budget 2016 towards emergency housing, 750 extra IRRS places, the Maori Housing Network and the 940 units through the crown land programme, $100M capital fund for expanding the crown land programme, and continuation of the Warm Up NZ and Healthy Homes initiatives.

And together with the national policy statement on urban developpment, these will go some way to address housing need in communities - but it won’t go far enough.

“New supply alone doesn’t help our lowest income families – we want to see the previous commitment honored to deliver at least 40% social and affordable housing on the crown land. It’s unclear whether the $100M just lets one arm of the crown pay the other for the land, or whether this will provide capital to get the affordable home built.

“It’s great there’s a commitment of a further $200 million for around 750 more IRRS spaces and increased rents. We would argue that a matching amount of capital to accompany the rent subsidy would enable New Zealand’s not for profit community housing sector to leverage private investment and retain affordability for future generations. We would make those 750 homes into 1,500 homes.

“It would form part of an action plan that we call “Our Place”, to deliver 15,000 more warm, safe, affordable homes for New Zealanders over the next five years.

“This investment will allow people to move out of emergency housing, housing them in a secure, affordable home first. We see this as an endoresemnt of the Housing First approach that the sector has been calling for”.

Scott Figenshow says the current government has produced better results in the past, with the Social Housing Fund of $140M of capital which generated 890 community housing units between 2009 to 2012.

“A further capital investment would work well alongside the current rent subsidy approach.”

The community housing sector currently provides over 5,000 social and affordable homes across New Zealand. It has benefited from prior investment through the Housing Innovation Fund, the Māori Development Programme and the Social Housing Fund to deliver approximately 1700 new homes and refurbish 900 more between 2003 and 2015.

Scott Figenshow says if the Government was serious about social investment and reducing inequality it would find an alternative social procurement approach that would grow our sector. He says the cost of competing for the funding is too expensive, meaning less money spent on delivering homes.

“We have a sector with the ability to deliver high quality homes to meet very real need in communities around New Zealand. The sector is ready, willing and able to put this into action – we’re just waiting for the investment on terms that deliver true affordability.”

“Too much of our sector capacity is being chewed up by an extremely expensive Government procurement approach that isn’t focused on meeting peoples’ needs. It has led to significant increase in costs to compete for funding rather than deliver housing. Greater uncertainty, higher cost, and less funding – no wonder we’re not generating as much housing as we could be,” he says.

“When Minister Smith announced in 2013 the goal that 20% of NZ’s social and affordable housing should be delivered by Community Housing groups using crown land investment, we expected it to be in place by now. We still have a long way to go.

ENDS

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