Diversifying the social housing sector – new details released

The Government yesterday released further information regarding its controversial new social housing plans. In a new, more diverse approach, the social housing functions that are currently provided by Housing New Zealand (HNZ) will be separated out. HNZ Zealand and Community Housing Providers (CHPs) will simply provide houses, with the Ministry of Social Development (MSD) purchasing places within these.

According to the MSD, this signifies a shift of focus from government ownership of houses, to facilitating places for tenants within these. The Government aims to increase the number of income related rent subsidies from 62,000 to 65,000 by 2017.

At the same time, Government ownership of social housing is to be shared with CHPs, with thousands of HNZ houses to be sold. HNZ will remain the main provider, and is to hold at least 60,000 of its current 68,000 in 2017.

The MSD’s Social Housing Purchasing Intentions sets out the Government’s intentions for social housing, with the aim to provide CHPs certainty; an action that is certainly needed in the wake of the Salvation Army and the Methodist Mission Aotearoa declining to partake. It provides data about the type and location of tenants, the likely rental price, and the type of houses that the MSD will be looking to purchase places in (see the news report here).

It will be interesting to see whether this new information will be sufficient to bring potential CHPs on board. The MSD will look to tailor tenant to placement and encourage ‘niche and specialist providers who can meet the needs of different tenants’ at the same time as utilising ‘providers who can achieve greater economies of scale and improve the overall contestability and responsiveness of the social housing market.’

Yet, the Salvation Army earlier declined to participate claiming a lack of ‘expertise, infrastructure and resources to successfully manage any social housing transfer of size’ (see here). Whether the information regarding MSD’s purchasing intentions gives sufficient support to the non-profit organisations that the Government seeks to engage with is yet to be seen. The first indication may be in May 2015, when Requests for Proposals will be issued to make another 300 tenancies available in Auckland from CHPs.

One thought on “Diversifying the social housing sector – new details released

  1. Pingback: Social housing changes to begin in Tauranga and Invercargill | CONSTRUCTION LAW BLOG

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