Simon Collins is the Herald’s education reporter.

Budget 2012: Non-govt social housing sidelined

Housing Minister Phil Heatley. Photo / Chris Rudsdale
Housing Minister Phil Heatley. Photo / Chris Rudsdale

Ambitious plans to boost non-government social housing appear to have been deferred in the drive to achieve a "zero Budget".

Grants to non-government housing bodies have been cut from $37.4 million last year to $34 million in the coming year and an average of $35 million a year over the following two years.

An extra $37.6 million has been allocated for increased rental subsidies for state house tenants, reflecting a widening gap between market rents and Housing NZ rents, fixed at 25 per cent of tenants' income.

But there is no sign of any rental subsidies for non-government agencies, despite an expectation that they will pick up a growing share of social housing for low-income tenants.

Read all of's Budget coverage here.

An advisory group led by current Housing NZ chairman Alan Jackson recommended two years ago that the Government should transfer state houses or capital to non-government agencies to help them provide 20 per cent of all social housing within five years, supporting them with rental subsidies for high-need tenants.

Housing Minister Phil Heatley said last year that he wanted a "radical increase in housing stock" with "a diversity of housing providers".

Yesterday's Budget suggests that goal has become more tentative, describing the Social Housing Unit's task for 2012-13 as: "Process developed for allocating the social housing fund and possible stock transfers that meet Government and probity requirements."

Funding for the Welcome Home loan scheme, which underwrites loans up to $350,000 to borrowers on household incomes below $85,000 a year, drops from $7.8 million to $4.3 million as rising house prices and incomes reduce the number of potential borrowers.

New capital for Housing NZ to buy, build and modernise state houses drops from $12.6 million to $10 million.

But administrative costs for leaky home claims go up from $18.7 million to $35.7 million, and subsidies for first-home buyers putting their KiwiSaver funds into a house go up from $10.6 million to $13 million.

- NZ Herald

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