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Affordable Housing
from The Jobs Letter No.85 / 27 August 1998
The Hikoi of Hope calls on the government and community to urgently identify options
to improve housing for low-income New Zealanders. Affordable housing is a cornerstone of
any programme to reduce poverty. Without secure, stable and safe housing, children's health
and learning is hindered and opportunities for social and economic participation are seriously
compromised.
- The 1991 Budget signalled a historic change to the way the government provides
housing assistance to low-income New Zealanders. The most significant changes were --
-- the introduction of market rents for state owned houses (instead of rent being set as a
percentage - usually 25% - of a tenant's income); and
-- the introduction of an asset and income tested cash benefit, the Accommodation
Supplement, as the only form of direct assistance for low-income tenants and homeowners in either public
or private housing.
At the time, it was argued that these changes would make the housing market more efficient
and fair and address the problem that tenants in state houses received more assistance than
people with similar needs who rented privately.
Housing policy was not perfect before 1991 and change to address real problems
was needed. However there is a great deal of evidence to suggest that the changes that were
made have not improved access to affordable, safe housing for low-income New Zealanders. In fact
the housing situation for many low-income people seems to have got significantly worse.
-- The N Z Council of Christian Social Services survey of foodbank clients found that
between 1994 and 1996, the number of state house tenants spending half or more of their income on
their housing costs increased from 37.5% to 58.8%, and private tenants spending half or more of
their income on rent increased from 58.9% to 62.7%.
-- In 1994, according to The Real Estate Institute, higher state rents led to an increase in all rents.
-- Rental costs have increased by an average of 60% in the last decade while in the same
period the overall Consumers' Price Index increased by only 25% according to the recently
released National Health Committee Report.
-- The number of households with two or more families increased by 96% between 1986
and 1996 with most of this increase occurring between 1991 and 1996.
--There has been an increase in hospital admissions from childhood diseases that are known to
be associated with overcrowding, including meningococcal disease and respiratory infections.
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"The link between housing and poverty means that New Zealand
can not be a socially just nation without seriously addressing the issues and problems outlined ... "
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- Contrary to expectations, since the disappearance of the Housing Corporation's
subsidised rents, private landlords have not increased their provision of housing at low rentals. Because
this type of rental accommodation gives very low returns, it is not considered an attractive investment.
-- There is a continuing and increasing prevalence of serious housing need - up from
17,500 households in 1988 to 48,800 households in 1993, according to one study.
-- The Ministry of Housing assessed the number of households in 1994 in serious housing need
at between 20,000 and 30,000.
A recent Christchurch study identified accommodation costs as "...probably the issue
having the biggest direct and indirect impact on the ability of limited income people to meet their
basic needs" (Jamieson 1998). This is in line with results from the New Zealand Poverty
Measurement Project, which showed that in 1993 housing costs were the single largest contributor to the
"poverty gap".
- Community and social service agencies are seeing the real impact of increased
accommodation costs on poverty:
-- Rent was the single most frequently mentioned reason for seeking help from 45.5% of
foodbank clients surveyed in 1996.
-- Until 1990 there were very few foodbanks in New Zealand by February 1998 there were
over 365.
-- The WIN on Poverty Campaign was declined a copy of the 1996 Colmar Brunton report on
the Department of Social Welfare/Ministry of Housing survey "because of the extensive errors
it contained". However the Ministry's own amended results (obtained under the Official
Information Act) using March 1997 data showed that 32% of Accommodation Supplement recipients
had $100 or less to cover all their living expenses after paying accommodation costs. 49% had
$150 or less. These survey results were not made publicly available.
- This evidence suggests that current housing policy is far from meeting the real needs
of low-income New Zealanders. The link between housing and poverty means that New Zealand
can not be a socially just nation without seriously addressing the issues and problems outlined above.
There is an urgent need for change. We can start by:
-- acknowledging the link between housing costs and poverty;
-- acknowledging the existence of significant and serious housing problems in New Zealand; and
-- in genuine consultation with community sector organisations, developing policies to
address these problems.
Sources -- Housing The Hungry: The Third Report, NZCCSS, 1996; Real Estate Institute 1995; The Social, Cultural
And Economic Determinants Of Health In New Zealand: Action To Improve Health, A Report From The National Advisory
Committee On Health And Disability, 1998; Serious Housing Need, Ministry of Housing, 1994; The Extent of Serious Housing
Need, Waldegrave and Sawrey, 1994; National Health Committee Report as above, quoting Jamieson, 1998; Measuring Poverty
in New Zealand, R Stephens, C Waldegrave and P Frater, Social Policy Journal, December 1995: Housing the Hungry: the
third report, NZCCSS, 1996; Foodbank Use in New Zealand, NZCCSS, 1998; WIN on Poverty Report, Women's
Information Network, 1998;
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