Paula Bennett and John Key announce $303.6 mln package of spending on emergency housing, including buying and leasing motels and building pre-fab homes; also $100 mln loan for Housing NZ; but deny crisis

By Bernard Hickey

Less than six months after announcing a NZ$42 million plan in the May Budget to provide emergency housing, the Government has announced another NZ$303.6 million of spending to provide up to an extra 1,400 places at any one time, including 600 in Auckland.

Social Housing Minister Paula Bennett and Prime Minister John Key announced the package in the Beehive Theatrette in Key's weekly post-cabinet news conference. Their announcement follows an Opposition-led Inquiry into homelessness and a call by Labour in July for extra funding for 1,400 new places.

"There are certainly challenges out there and our most vulnerable feel them," Bennett said when asked if this announcement was an admission of a housing crisis in Auckland.

Bennett said the Government had set up a cross-agency team to find or build new properties, including potentiallly buying or leasing motels, and building pre-fabricated homes on Government land.

The NZ$303.6 million package of spending over the next four and a half years includes:

1. NZ$120 million in capital funding to build, buy or lease properties suitable for emergency housing, including NZ$100 million in a loan to Housing NZ.

2. NZ$71 million in rental subsidies.

3. NZ$102 million for Community Housing Providers to support, stabilise and help tenants into longer-term housing.

4. NZ$10.4 million for more dedicated frontline Ministry of Social Development staff to work with people who need emergency housing or are on the social housing register.

Bennett said some of the housing would be provided on vacant Crown land, including more than 40 homes to be built by Housing NZ in Otahuhu Auckland on land leased from the Ministry of Education and ready by early 2017.

“We’ll also use vacant Crown-owned properties where they are available, purchase accommodation facilities and lease properties as needed in areas of high demand," Bennett said.

“These new places will be in addition to the more than 3,000 places per year and special needs grants for accommodation we have already funded to the tune of NZ$41.6 million in Budget 2016. In total, we’re aiming for more than 8,600 places per year, as well as continuing to provide access to alternative accommodation when contracted emergency places are not available,” she said.

Bennett said the Government was working on building modular housing on three sites across Auckland, while Housing New Zealand had bought a motel in Takanini.

'Auckland a big issue'

“Especially in Auckland, the strong market has made it hard to find new places, but with this funding we have made sure it’s not money that’s holding us back," Bennett said.

Bennett later said the NZ$100 million loan to Housing New Zealand would be fiscally neutral.

Bennett and Key said the NZ$303.6 million would come from the Budget 2017 allowance for new spending of over NZ$1 billion. The news follows Treasury's report on Friday that the Budget surplus was running over NZ$700 million higher than forecast in May because of stronger than expected economic growth increasing corporate income taxes and GST receipts.

The NZ$102 million of funding for Community Housing Providers would allow them to manage the tenancies of those in emergency housing, develop plans for more sustainable housing and then support people in their first three months of their new tenancy, Bennett said.

This would fund services to help up to 1,400 individuals and families at any one time, or 5,600 individuals and families per year.

The funds for extra staff would cover 41 additional staff to handle case management for those in emergency housing situations, including support to Marae and other community organisations.

Political reaction

Labour Housing Spokesman Phil Twyford said the Government had been shamed into action and he noted how the 1,400 places was the same as Labour's call for 1,400 places in July.

"Today’s announcements won’t solve National’s housing crisis. Every week, there’s a new announcement from National and all they show is how bad they’ve let things get.This announcement is an ambulance at the bottom of the cliff, but the real solution is to stop pushing people off the cliff in the first place," Twyford said.

“The heart of the housing crisis is a lack of affordable housing and state houses. There’s no substitute for building houses. That’s why Labour will build 100,000 affordable homes for first homebuyers to purchase as well as thousands more state houses, and lock speculators out of the market," he said.

“The Cross Party Inquiry on Homelessness found an extra 15-25,000 state houses are needed so 41,000 homeless Kiwis can all have proper housing. The massive increase in homelessness is a direct result of National’s negligent mismanagement of the housing crisis, including its sell-off of state houses.

New Zealand First Leader Winston Peters said Bennett had panicked because of pressure from political opinion polls.

"National has got the drift that middle New Zealand is feeling uncomfortable that thousands of innocent Kiwis are in hardship. And no wonder, this Minister is making an absolute mess of the social housing portfolio," Peters said.

"She’s flogging off state houses, and then wonders why the headlines are about people living in garages, on the streets, in cars and caravan parks," he said.

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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67 Comments

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23

They are playing desperate catch up. Denied there was a problem for years.
This govt are brilliant at reactionary policy, abysmal at front footed policy.

leadership from the rear

For a very generous definition of leadership.

up
17

yes spending more to catchup on infrastructure and services, still more to come yet
remind me again please how high immigration of low wage workers will take NZ forward

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10

we have such visionary leaders...

"Labour will build 100,000 affordable homes for first homebuyers" and Santa will come down the chimney on the 25th

Everyone knows Santa comes down the chimney on the 24th, so expect Labour to deliver a day early.

... the niggly-naggly snag in Labour's absolutely cool and groovy plan is that whilst the houses are going to be " affordable " , the land they sit atop is not ...

quote ... Today’s announcements won’t solve National’s housing crisis .....

It's only at the announcement stage ... any detail? .. starting when? .. where? .. when? .. by whom?

You watch ... it will be yesterdays news tomorrow ... forgotten next week

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16

Election year comming and national trying hard as need media byte to save themselves but still in denial...well that is their llegacy : Deny, Lie, Manipulate and if nothing works Blame one and all.

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15

The photo of the the minister must be when announcing to the media as seems so happy for a change and very pleased (relief) with themselves as heart to heart they too knows that they are working only for the elite and overseas friends and normally whenever they face media have to follow their legacy of denial and lie ( which shows on their face).

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14

Seriously she seems to be so happy and relieved.

Ministers why don't you come out more with what the country wants and than you will be smiling and people will also be smiling. Work for People of NZ and not Foreigners (it is sad that you remember average Kiwi only when at the time of election year).

Sad and Shame.

We should be so grateful that we have leaders like Paula Bennett and John Key who always go the extra mile to help those in need. I have a lot of respect for Paula as she is always smiling, friendly and approachable for those who need help, despite all the criticism. This announcement is a proof of her legacy as a Social Housing Minister. Good on ya Paula!

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12

You may be correct Double-GZ but how do you explain this to 400000 kiwi who will have to make way for foreigners and elite few :

http://m.nzherald.co.nz/property/news/article.cfm?c_id=8&objectid=11743683

It is universal truth that people deny and lie when have something to hide - If not than why is government not placing the correct non resident (overseas) buyer data in public domain without manipulation. To act or not to act is upto them being in government. My question is why manipulate and Lie and another truth is that no one like manipulation and lie (few who are benefiting by their lie will defintely be happy).

How correct Reena. Wonder what is so called experts view on your Question.

That sounds awfully sarcastic

Government making fun of FHB - is much worse.

We too are happy for her. Wish it continues ..........even if it is for election.

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12

Here comes the bribe ....
See hong kong slapping investors with a 15% vancouver tax

Time to target investors and foreign buyers (include students and temp visa)
Higher state housing costs are picked up by taxpayers while the government allows this housing crisis to continue

Wake up

http://www.channelnewsasia.com/news/business/hong-kong-property-stocks-h...

Uk australia canada Singapore hong kong all charge foreign buyers stamp duty

Nz doesnt

Why ?

Stamp duty hurts everybody. Paying 15% to the government on the purchase of a property is no different to a mafia boss asking for a shake down so you can run your pizzeria with both knee caps. Stamp duty is legalized robbery and should be avoided at all costs.

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10

Over $300 million of tax payer money being spent to try and remedy a problem of their own creation that they have been denying even existed. The mind boggles as to how this incompetent lot are still polling so well, its a true reflection of our society.

We're being run by an organised crime syndicate. Assuming this ever progresses beyond Paula Bennett grandstanding in ugly jackets, I'll bet a cross-ref of donors and owners of bought and leased motels would be revealing.

This is just nonsense. New Zealand has the highest ratings in the world for everything that is to do with good governance. It is the ideal place for those who want to work hard and make something of their lives. Almost all suffering is the result of poor personal life choices.

Troll harder.

I am not trolling. I have facts to back it up. NZ ranks highly in everything that is good. We don't want a government that is going to try and make everyone equal.

But we do absolutely want and need a government that will make us all less unequal. We do not call for us all to be completely equal, it is only people such as you that picks up and runs with the whole "make everyone equal" nonsense.

need a government that encourages work, not speculation

We have a government like that currently.

No we don't

Maybe that is the problem - that we don't treat or accept each other as equals. It is not about making everyone equal - we already are. The narrative that we are not is the false truth that keeps us divided, keeps us competing against each other, and results in the imbalance we see today.

Hey Zachary,

Please site the source of your facts next time, as an example NZ has been slipping down the Transparency International Index (A very well respected NGO) for a few years now. We used to be first equal but lately we've slipped to fourth. I'm betting with the fisheries drama unfolding we'll go lower this year.

So one way of looking at the "facts" is that under this government the country has become more corrupt.

http://www.transparency.org/cpi2015?gclid=CPvBg9ntl9ACFQQAvAod7-MGIQ

Come on man the difference between the top four is miniscule, that's being really picky. Fourth is a really good score and on average over the last four years we come second to Denmark.
I didn't say we are the top in everything, I said we scored highly.

Maybe in the past but standards are in free fall.

https://www.nbr.co.nz/article/nz-politics-daily-verdict-government-corru...

"Similarly, Hooton pronounces that the Government is guilty of bribery, saying that McCully “paid this $11.5m bribe"

.

There has always been a problem with housing the poor and homeless. This problem is not of the government's making, it is a failure of many to take personal responsibility for their own lives.

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11

"The problem is not government making" - If government in power since last 8 years is not responsible than who is LOL.

True National party supporter : Legacy of Denial.........

So everything that has gone wrong in your life in the last eight year's is the government's fault? Currently there are something like 2,500 empty state houses throughout the country.

No, only the things that the government is responsible for, that we pay them to do. The hint's in the article - "Social Housing Minister Paula Bennett". That's the giveaway that she's responsible for this, and is required to stop pissing around, fulfill her duties and do her damn job. Or are you suddenly less keen on personal and professional responsibility when it's an MP, rather than a cleaner?

Nice try Kakapo but the government is doing its job. A lot of money and effort goes into these things currently and always has but we do expect the government to spend wisely. We cannot 'reward' people's poor life choices.

So… nothing to do with the cost of housing going from 3* to 11* household income in a generation?
Blame the victims why don’t we.
No it is housing policy failure, with a large section of NZ society getting rich easy out of it.

Auckland is not the only place to live in New Zealand. Houses in good locations have never ever been 3* household income. Auckland as a good location has simply expanded. People are now realising that most of NZ is a good location.

And now people who lived and could afford to buy in the regions will no longer be able to afford to buy where they live and work.

They will have to adapt. What does not kill them will make them stronger.....okay I'm trolling now, lol.

Mid 1980's and prior Auckland was 3x medium household income, and that was when there was more single income families.

And following your logic, Hong Kong must be the best location in the world at 19x medium household income.

DGZ was 3x medium household income? I don't think so. Like I said the location has improved and yes Hong Kong is a good location.
*also mortgage interest rate was eye watering back in the eighties at over 15%.

... how the heck can Hon Kong be considered a good location ... there's no cows , no coal , and no sheep ...

I went there , and there's no gumboots and no # 8 wire to be seen anywhere ...

... how can they survive , without their Gummies ?

'You don't think so', or you know so? Which is obvious you don't? You stated 'has never ever been 3x household income. Wrong.

And at 19x house hold income, this by your logic would make Hong Kong not only a good location , but the best location in the world.

I'm suggesting premium locations were not 3X average household income to be clear.

I think it is systemic governmental failure to deal with the social issues we have in any meaningful way whatsoever.
The problem is not so much personal choice, but the colour of your skin, where and to who you were born, and the people and neighbourhood that brings you up and shapes your ideals.
Saying its a lack of personal responsibility is simplistic.

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10

Avoid gathering the data on the make-up of buyers
Avoid comprehensive CGT
Avoid Supply side as long as poss
Avoid Governing
Panic and spend $300 Mil

Am not surprised by few comments as their would always be people who are making money out of national policy of protecting and supporting speculators so definetly will be upset and not like to see change which is inevitable.

Most people are doing all right, more than all right actually, so National will win

Most of the rent subsidies and working for families money effectively inflates house prices and rents, so huge amounts of taxpayer money goes in, and no tax comes out....

For crying out loud, if they had a) Listened to developers in the first 8 years of their term (who have been telling them over and over again that they can't build - due to stupid idealogical council planning rules), b) Limited immigration and c) Put even the slightest curbs on foreign investment, we wouldn't be in this mess.

Now that election time isn't too far away, and the problem can't be ignored any longer, we're seeing these stupid, temporary and expensive faux solutions.

Well they have simply never taken the housing issue seriously. SHAs were for the most part a joke.
There's plenty of demand/supply measures they could have adopted if they were serious.
But they aren't. Because property investors etc are key constituents for them.
That is the sad reality.

Is there anywhere in the world where things are done better? Serious question.

Parnassus .

Not really. Because most elected governments are cynical/opportunistic, or look out for their 'mates' first and foremost.
But here's a start - Vancouver is doing it better than us on housing. The stamp duty is having a meaningful impact.

Do we not need all our motels for our sky rocketing tourism industry. ?

Surely cannot have it both ways.?

Simple. List all the semi-derelict state houses they're leaving to rot on AirBnB. Advertise it to tour parties as 'An authentic New Zealand run-down slum experience'.

Oh god, they'll probably try it.

There are 3 planks to National Party policy.

Must inflate bubble.
Must inflate bubble.
Must inflate bubble.

Danger Will Robinson! Danger! A lot of people already have few choices and what little they had are being systematically taken. They're being set up for failure. A neoliberal agenda to turn less fortunate people into an exploitable resource and designed to impose class on society. Privatising social services and publicly funding them.

I'm not surprised we're not educating them to fail too - oh hang on - Charter Schools. Private failure indoctrination centres to feed private social services and then off to private internment facilities.

Hey look! Steven Adams! Over there!

Must inflate productivity
Must inflate prosperity
Must deflate expectations

A politician thinks of the next election; a statesman thinks of the next generation. —James Freeman Clarke

What if you don't have any kids?

Should it make a difference? Thinking of the next generation means you don't want to screw it for the next person.
Remember that next generation will be in power some day, treat them bad, don't expect any favours...

Hey guys and gals (what's the collective now for people that sift round the comments section on interest.co.nz)

I read a great satirical article that I feel sums up some on this site perfectly.

http://www.betootaadvocate.com/uncategorized/ageing-baby-boomers-cant-wa...

"I never had it easy!" says James, who bought his first house on an apprentice wage