Monday 07 November 2016 05:11 PM
Budget 2017: Govt finds $300 mln for emergency housing
By Pattrick Smellie
Nov. 7 (BusinessDesk) - The government has announced $300 million in emergency housing, $120 million of which will be available to buy motels, build short term modular housing, and allow construction of temporary housing on Crown land earmarked for roads and schools in the more distant future.
The decision is the government's latest salvo in the politically charged area of housing policy, in which both unaffordability and short supply are combining to squeeze low income and first home buyers out of the market.
Prime Minister John Key and Social Housing Minister Paula Bennett announced the package after the Cabinet met and approved it today, making it the first announcement of new funding agreed in the context of the 2017 government budget, not due for publication before May next year.
It comes after last week's announcement of a larger than expected budget surplus for the first three months of the current fiscal year, amid growing talk of the government being able to promise tax cuts as voting bait ahead of the general election due late next year.
The package comprises a $100 million loan to Housing New Zealand, to be repaid within 10 years, along with a $20 million flexible facility also available for capital outlays.
A further $71 million per year is available for annual rental subsidies, while another $102 million is set aside for community providers of social and emergency housing to "support, stabilise, and help tenants into longer-term housing". The community provider funds are not available for purchasing or building houses, as the sector received a $120 million new capital funding package earlier in the year.
A further $10.4 million will fund Ministry for Social Development frontline staff "to work with people who need emergency housing or are on the social housing register".