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No Progress With Fair Rents Frustrates Tenant Group

The lack of progress with the introduction of income-related rents for all Council tenants is frustrating the tenant-led IRRS4ALL Campaign seeking the Government IRRS subsidy for Wellington Council's loss-making social housing unit.

At the moment, only Kianga Ora and registered Community Housing Providers CHPs) attract the IRRS subsidy, which is not available to local councils.

The Council's plan to turn their loss-making housing unit into a Community Housing Provider (CHP) doesn't solve the serious inequity built into the system. While newly acquired CHP tenants will attract the IRRS and pay only 25% of income in rent, thousands of existing tenants will have to continue to pay a rent of 70% of market rate.

“We have met with the Minister of Housing, have the support of some Labour and Green MPs, and Councilors are supportive because it would solve the problems of their housing unit”, said Campaign spokesperson Warwick Taylor. “Housing is a human right, and it is intolerable that the Government doesn't move accordingly to extend the IRRS to all local council social housing.”

There were suggestions and hints that there might be “something” in the recent budget. “All that came out of the Budget was a maximum of $9.8 million for IRRS eligible new tenants of the proposed new CHP. Existing tenants get nothing!”

References to “eligible tenants” getting the IRRS may have misled some tenants into supporting the CHP option during the Council's recent Consultations on what to do with City Housing, as required under the Local Government Act.

Figures obtained by the Campaign under the Local Government Official Information and Meetings Act do not appear to support the Council's claim that City Housing will be insolvent by next July. The figures appear to show that City Housing is actually making a cash surplus, and that the “loss” comes from a book entry for depreciation.

The recent Consultation documents give financial estimates for both rates funding/ borrowing to support City Housing, and for the setting-up costs of the preferred CHP option. A detailed look at these suggests that the overall costs of each in the short term are not significantly different. The proposed long-term benefits do not solve the problem of the thousands of existing tenants who will continue to pay an inequitable rent.

The IRRS4ALL Campaign calls on the Government to stop discrimination against tenants of Councils, and provide an income-related rent subsidy for all eligible Council tenants. We also urge Council to give further thought to the current proposals to set up a CHP before coming to a final decision.

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