End of a (state housing) era

Housing Minister Nick Smith has just announced a new “entity” within Treasury to transfer some of our 69,000 state houses to private organisations (coincidentally, on the same day as retrospective legislation on how housing trusts are taxed has had to be introduced).

This is something we knew was coming since the Government eagerly greeted the Housing Shareholders Advisory Group (HSAG) report’s conclusions on how the community sector houses people better, since the Social Housing Reform Bill provided a framework for a multiprovider environment, and since Budget 2014 provided the funding to make stock transfer happen.

The Minister’s said:

“[C]ommunity housing providers…are able provide wraparound social services alongside housing support, they have a better record than the state in consistently managing the quality of housing, and we believe they can achieve better value for money across more houses.”

As far as I know, we don’t yet have the evidence that community housing providers can achieve better value for money than the state. Certainly, the Housing Shareholders Advisory Group report provided little evidence for its conclusions. 

We have certainly heard a lot more about the housing quality problems in Housing NZ stock than in community housing stock – but it’s also likely that we would, as Housing NZ has responsibility for a far greater number of houses.

Perhaps the Minister is referring to the track record of community housing organisation versus government housing providers overseas. However, such organisations (for example in the UK)  have stock numbering in the tens of thousands, so it’s quite difficult to compare them to the small – though set to expand – organisations in New Zealand.

It’s definitely true that many community housing providers are presently doing a great job providing secure and quality homes for many New Zealanders. I hope this policy sees more people housed, and some of the issues I worry about in these pages addressed.

But for now, if the Minister won’t celebrate Housing NZ now, in its last days as we know it, I will.  While it’s true that some state houses are crowded and damp, we also know that the state has done a better job than the alternative of renting privately: the health of people living in state housing improves the longer they’re there.  We also know that a Housing NZ survey showed that 85% of tenants feel more in control of their lives since entering state housing. The words of one state tenant, recorded in a Housing NZ report are worth recalling:

We now live in healthy, warm and sustainable homes, which is great for our kids. Our children now walk 10 feet tall.

When Housing NZ invested in houses and communities, we saw good results, for many decades.

Here is a film for your lunch hour, in which we see the distress that renters are under when they cannot afford to buy houses, when they crowd into poor quality private rentals, and for whom state housing provides shelter and community. The film was produced in 1946….


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