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Posts Tagged ‘State Housing’

Steven Joyce rails against low mortgage interest rates; claims higher interest rates “beneficial”

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National is increasingly on the back-foot with New Zealand’s ever-worsening housing crisis. Ministers from the Prime minister down are desperately trying to spin a narrative that the National-led administration “is getting on top of the problem“.

Despite ministerial ‘reassurances’, both Middle and Lower Working  classes are feeling the dead-weight of a housing shortage; ballooning house prices,  and rising rents.

Recently-appointed Finance Minister, Steven Joyce,  has found a new unlikely scapegoat, blaming the housing bubble and worsening housing affordability  on current low interest rates.  On 11 May, on Radio NZ’s Morning Report, he said;

“We have very, very low interest rates historically, and as a result that’s directly linked to how much house prices are being bid up around the world. It’s not the sole reason for why we have high asset prices around the world, it’s not just houses, it’s shares and everything else. But it is certainly one of the dominant reasons for that. And unfortunately it’s going to be a little bit of time yet before that changes, although there’s indications that this period of ultra-low interest rates that the world has seen is coming to an end. And so I think that, that, will improve affordability over time.”

Radio NZ’s Guyon Espiner reacted with predictable incredulity that Joyce was relying on interest rates rising to “improve affordability over time“.

Joyce’s finger-pointing and blaming “very, very low interest rates historically” is at variance with a speech that former Dear Leader, John Key, gave in January 2008 where he specifically indentified higher interest rates as a barrier to home ownership;

* Why, after eight years of Labour, are we paying the second-highest interest rates in the developed world?

[…]

* Why can’t our hardworking kids afford to buy their own house?

Good questions, Mr Key

Got any answers, Mr Joyce?

Because according to Statistics NZ, home ownership rates have worsened since John Key gave his highly-critical speech, nine years ago;

Home ownership continues to fall

  • In 2013, 64.8 percent of households owned their home or held it in a family trust, down from 66.9 percent in 2006.

  • The percentage of households who owned their home dropped to 49.9 percent in 2013 from 54.5 percent in 2006.

Home ownership reached a peak of 73.8% by 1991. Since then, with  the advent of neo-liberal “reforms” in the late ’80s and early ’90s, home ownership has steadily declined.

Those who have benefitted have tended to be investors/speculators. In 2016, 46% of mortgages were issued to property investors/speculators in the Auckland region. Despite a watered-down, pseudo-capital gains tax,  referred to as the “bright line” test implemented in October 2015, investors/speculators still accounted for 43% of house purchasers by March of this year.

The same report revealed the dismal fact that first home buyers constituted only 19% of sales.

John Key’s gloomy plea, “Why can’t our hardworking kids afford to buy their own house?” rings truer than ever.

Poorer families are fairing no better.

National’s abysmal policy to sell off state housing has left a legacy of families living in over-crowded homes; garages, and cars. This scandal has reached the attention of the international media.

From the Guardian;

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From Al Jazeera;

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As with our fouled waterways, we have developed another unwelcomed reputation – this time for the increasing scourge of  homelessness.

But it is not just the sons and daughters of the Middle Classes that are finding housing increasingly out of their financial reach. The poorest families in our society have resorted to living in over-crowded homes or in garages and in cars.

National has spent millions of taxpayer’s dollars housing families in make-shift shelters in motels. At the behest on National ministers, WINZ have made it official policy to recoup money  “loaned” to beneficiaries to pay for emergency accommodation;

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National’s track record on this growing community cancer has been one of ineptitude.

In 2015, Dear Leader Key made  protestations that  no problem exists in our country;

“No, I don’t think you can call it a crisis. What you can say though is that Auckland house prices have been rising, and rising too quickly actually.”

He kept denying it – until he didn’t;

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Unfortunately, former-and current State beneficiary, and now Social Housing Minister, Paula Bennett, apparently ‘did not get the memo’. She still denies any housing crisis in this country;

“I certainly wouldn’t call it a crisis. I think that we’ve always had people in need. So the other night on TV I heard the homeless story was second in and then the seventh story was a man who’d been 30 years living on the streets.”

Despite  being in full denial, in May last year Bennett announced that National would be committing $41.1 million over the next four years  for emergency housing and grants.

By April this year  it was revealed that National had already spent $16.5 million on emergency accomodation. It had barely been a year since Bennett issued her Beehive statement lauding the $41.1 million expenditure, and already nearly a third of that amount has been spent.

This is clear evidence as to how far out-of-touch National is on social issues.

The stress and pressure on Ministers and state sector bureaucrats has become apparent, with threats of  retribution flying.  This month alone, a MSD manager and associate minister of social housing, Alfred Ngaro, were revealed to have warned critics of the government not to talk to the media;

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Bennett went on to make this extraordinary statement;

“I spend the bulk of my time on social housing issues and driving my department into seriously thinking about different ways of tackling this.”

Her comment was followed on 20 May, on TV3’s The Nation, when current Dear Leader, Bill English tried to spin a positive message in  National’s ‘fight against homelessness’;

“Our task has been to, as we set out three or four years ago, to rebuild the state housing stock. And that’s what we are setting out to do.”

English and Bennett’s claims would be admirable – if they were not self-serving hypocrisy.

In 2008, Housing NZ’s stock comprised of  69,000 rental properties.

By 2016, that number had fallen to 61,600 (plus a further 2,700 leased).

In eight years, National has managed to sell-off 7,400 properties.

No wonder English admitted “we set out three or four years ago, to rebuild the state housing stock“. His administration was responsible for selling  off over ten percent of much-needed state housing.

No wonder families are forced into over-crowding; into garages and sheds; and into cars and vans.

Confronted by social problems, National ministers duck for cover. Especially when those same social problems are a direct consequence of their own ideologically-driven and ill-considered policies.

National ministers English, Bennett, Joyce, Nick Smith, et al are responsible for our current homelessness.

Parting thought

Left-wing parties and movement are generally proactive in identifying and resolving critical social problems and inequalities. It is the raison d’etre of the Left.

The Right seem only able to belatedly react to social problem and inequalities.

Especially when they caused it.

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References

Interest.co.nz: PM says no housing crisis in Auckland

NZ Herald: Housing shortage growing by 40 homes a day

Fairfax media: House prices rise at an ‘eye-popping’ rate for 6 NZ regions – Trade Me

Interest.co.nz: Median rents up $50 a week over last 12 months in parts of Auckland

Radio NZ: Lessons for NZ in Australia’s Budget

NZ Herald: John Key – State of the Nation speech

Statistics NZ: 2013 Census QuickStats about national highlights

Statistics NZ: Owner-Occupied Households

Radio NZ: Homeless family faces $100k WINZ debt

Interest.co.nz: New official Reserve Bank figures definitively show that investors accounted for nearly 46% of all Auckland mortgages

Simpson Grierson: New “bright-line” test for sales of residential land

Property Club: First buyers still missing out in Auckland’s most affordable properties

The Guardian: New Zealand housing crisis forces hundreds to live in tents and garages

Al Jazeera: New Zealand’s homeless – Living in cars and garages

NZ Herald: No house, not even a motel, for homeless family

Radio NZ: Key denies Auckland housing crisis

Radio NZ: No housing crisis in NZ – Paula Bennett

Beehive: Budget 2016 – 3000 emergency housing places funded

Mediaworks: Homeless crisis costing Govt $100,000 a day for motels

Radio NZ: Emergency housing providers instructed not to talk to media

Radio NZ: Ngaro apologises for govt criticism

TV3: The Nation – Patrick Gower interviews Bill English

Housing NZ: Annual Report 2008/09

Housing NZ: Annual Report 2015/16

Previous related blogposts

Can we do it? Bloody oath we can!

Budget 2013: State Housing and the War on Poor

Budget 2013: State Housing and the War on Poor

National recycles Housing Policy and produces good manure!

Our growing housing problem

National Housing propaganda – McGehan Close Revisited

Housing; broken promises, families in cars, and ideological idiocy (Part Tahi)

Housing Minister Paula Bennett continues National’s spin on rundown State Houses

Another ‘Claytons’ Solution to our Housing Problem? When will NZers ever learn?

Government Minister sees history repeat – responsible for death

Housing Minister Paula Bennett continues National’s spin on rundown State Houses

Letter to the Editor – How many more children must die, Mr Key?!

National under attack – defaults to Deflection #1

National’s blatant lies on Housing NZ dividends – The truth uncovered!

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Problem…

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Solution.

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This blogpost was first published on The Daily Blog on 21 May 2017.

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The Mendacities of Mr English – Social Services under National’s tender mercies

12 February 2017 2 comments

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On 25 January, as Radio NZ returned to it’s normal broadcasting schedule (and putting away it’s dumbed-down “summer programming” until next December/January), John Campbell had his first interview with John Key’s replacement, Bill English.

Campbell raised several issues with English; the US withdrawal from the TPPA; the Pike River mine disaster; and the housing crisis. At this point, English made this staggering claim;

@ 5.58

“We’ve got a government actually with a good record on addressing, in fact, some of the toughest social issues. There may be disagreement over means by which we’re doing it, ah, but our direction is pretty clear. And you know over, certainly heading into election year we think that the approach the government’s developed around social investment, around increasing incomes is the right kind of mix – “

English’s bland assertion that “government actually with a good record on addressing, in fact, some of the toughest social issues” is at variance with actual, real, mounting socio-economic problems in this country.

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Key indicator #1: Unemployment

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The latest HLFS unemployment stats show an increase from 4.9% to 5.2% in the December 2016 Quarter. However, in all likelihood, the unemployment numbers are actually much, much, higher since Statistics NZ arbitrarily altered the way it  calculated what constituted  unemployment.

On 29 June 2016, Statistics NZ announced that it would be changing the manner in which it defined a jobseeker;

Change: Looking at job advertisements on the internet is correctly classified as not actively seeking work. This change brings the classification in line with international standards and will make international comparability possible.

Improvement: Fewer people will be classified as actively seeking work, therefore the counts of people unemployed will be more accurate.

The statement went on to explain;

Change in key labour market estimates:

  • Decreases in the number of people unemployed and the unemployment rate

  • Changes to the seasonally adjusted unemployment rate range from 0.1 to 0.6 percentage points. In the most recent published quarter (March 2016), the unemployment rate is revised down from 5.7 percent to 5.2 percent 

  • Increases in the number of people not in the labour force 

  • Decreases in the size of the labour force and the labour force participation rate

The result of this change? At the stroke of a pen, unemployment fell from 5.7% to 5.2% for the March 2016 Quarter (and subsequent Quarters).

If the “current unemployment figures” from Stats NZ are reported as “5.2%’, they may well be back to the original March 2016 figure of 5.7%, before the government statistician re-jigged definitions.

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Key indicator #2: Housing

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– Home Ownership

According to the 1984 NZ  Yearbook, in 1981 the number of rental dwellings numbered 25.4% of housing. 71.2% were owner-occupied. Nearly three quarters of New Zealanders  owned their homes.

Home ownership reached it’s maximum height in 1991, when it stood at 73.8%. Since then, it has steadily declined.

By 2013 (the most recent census survey), the numbers of rental dwellings had increased to 35.2% (up 33.1% in 2006). Home ownership had decreased to  49.9%  (down from  from 54.5% in 2006). If you include housing held in Family Trusts, the figure rises to 64.8% of households owning their home in 2013, down from 66.9% in 2006.

Whether you include housing held in Family Trusts (which may or may not be owner-occupied or rented out), home ownership has fallen steady since the early 1980s.

Renting has increased from 25.4% to 35.2%.

More and more New Zealanders are losing out on the dream of home ownership. Conversely, more and more of us are becoming tenants in our own country.

As Bernard Hickey from Interest.co.nz said in December last year;

Nearly two thirds of the 430,000 households formed since 1991 are tenants.

Think about that for a moment. It is a stunning revelation of how the young and the poor have been hit the hardest by the changes in New Zealand since the mid-1980s, and on an enormous scale.

It means two thirds of the kids born in those families grew up in rental accommodation, and more than 80% of those are private rentals (although the Housing NZ homes are often no better). That means they often grew up in mouldy, damp, cold and insecure housing. It’s true that some homes occupied by their owners are also below par, but it’s a much lower proportion and owners have the option to improve their homes through insulation and ventilation.

The NZ$696 billion increase in the value of New Zealand’s houses to NZ$821 billion between 1991 and 2015 means the 64% of owners in live-in houses have also had plenty of financial flexibility to improve those houses. Renters have had no access to that wealth creation and are not allowed to put a pin in the wall, let alone put in a ventilation system or some batts in the ceiling. The take-up for the Government’s home insulation and heating subsidies were vastly higher among home-owners than they were for landlords.

Those 284,000 renting households formed since 1991 have also often been forced to move schools and communities and all the roots that build families because New Zealand’s rental market is so transient.

[…]

It illustrates the scale of the fallout from that collapse in home ownership from 1991. Not only has it handicapped the education, health and productivity of a entire generation of New Zealanders, but it is set to magnify the likely growth in pension and healthcare costs of our ageing population. And that’s before the wealth and income inequality effects.

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– Affordability

In 2016, the 13th Annual International Demographia International Housing Affordability survey rated New Zealand as one of the most unaffordable housing markets in the world;

The most affordable major housing markets in 2015 are in the United States, with a moderately unaffordable Median Multiple of 3.9, followed by Japan (4.1), the United Kingdom (4.5), Canada (4.7), Ireland (4.7) and Singapore (4.8). Overall, the major housing markets of Australia (6.6), New Zealand (10.0) and China (18.1) are severely unaffordable. (p2)

[…]

In New Zealand, as in Australia, housing had been rated as affordable until approximately a quarter century ago. (p24)

A 2014 report by the NZ Institute for Economic Research stated  the “the average house price rose from the long-run benchmark of three times the average annual household income to six times“;

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The NZIER report refers to several reasons for increasing housing prices; slow supply of land; demographic demand (from ‘Baby Boomers’); and investor demand caused by lack of a capital gains tax. Interestingly, the Report also refers to an “over-supply of finance”;

The loosening of financial standards and rising household debt relative to income has happened over a long period of time. The increase in indebtedness has coincided with rising house prices relative to incomes. This suggests that increased household indebtedness has at least partly contributed to the increasing price of homes. (p14)

Prior to Roger Douglas de-regulating the banking/finance sector, New Zealand banks could only lend depositor’s funds as mortgages.

As a result, mortgage money was “tight”, and scarcity helped keep house prices down. Vendor’s expectations were kept “in check” by scarcity of bank funds. Prior to the mid 1980s, Vendor’s Finance (by way of a Second Mortgage) were commonly-used financial tools to assist house-owners to sell and buyers to complete a purchase.

Once the banking sector was opened up, and monetary policy relaxed, cheap money flooded in from overseas for banks to on-lend to house-purchasers. As property investor, Ollie Newland vividly explained in the 1996 TV documentary, Revolution;

“I got a phone  call from my bank manager to say some bigwigs were coming up from Wellington to have a chat with me. I thought it was just one public relations things they do. I had a very small office, it wasn’t much bigger than a toilet cubicle, and those five big fellows  crowded in with their briefcases and books and they sat on the floor and the arms of the chairs – I only had one chair in the place – and stood against the walls. Their first words to me were, we’re here to lend you money. As much as you want. For somebody like me, and I’m sure it’s the same for everybody else, to suddenly be told by the bank manager that you could have as much money as you want, help yourself, that was a revelation. We thought we had died and gone to heaven.”

Unfortunately, the side affect of this was to increase vendor’s expectations to gain higher and higher prices for their properties. Combined with recent high immigration, and a lack of a comprehensive capital gains tax, and the results have been troubling for this country;

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As well as increasingly unaffordable housing, we – as a nation – are sitting on a trillion-dollar fiscal bomb.

Think about that for a moment.

Little wonder that in September last year, the Reserve Bank issued the sternest warning yet that we were headed for impending economic mayhem;

A sharp correction in house prices represents a key risk to the financial system, and one that is increasing the longer the current boom in house prices persists. A severe downturn in house prices could have major implications for the banking system, with over 55 percent of bank loans secured against residential property. Moreover, elevated household debt levels and a growing exposure of the banking system to investor loans could reinforce a housing downturn and extend reductions in economic activity, as highly indebted households are forced to reduce consumption and sell property.

As with many other individuals, institutions, organisations, business leaders, left-wing commentators, media, political pundits, political parties, the NZIER was (and still is) calling for a comprehensive capital gains tax to be implemented.

Even then, this blogger suspects we may be too late. National (and it’s predecessor, to be fair) have left it far to late and the economic horse has well and truly bolted.

Even a Capital Gains Tax at 28% – New Zealand’s current corporate tax rate – may be insufficient to dampen speculative demand for properties.

Meanwhile, the dream of Kiwis owning their own homes continues to slip away.

Depressingly, New Zealanders themselves have permitted this to happen.

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– State Housing

If the Middle Classes and their Millenial Offspring are finding it hard to buy their first home, think of the poorest  families and individuals in our communities. For them, social housing consists of packing multiple families into a single house; living in an uninsulated, drafty,  garage; or in cars.

Last year, the story of mass homelessness exploded onto our media and our “radar” as New Zealanders woke up to the reality of persistent poverty in our cities;

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Although on occassion, the mainstream media found them themselves  in embarrassingly ‘schizophrenic’ situations as they attempted to reconcile reporting on our growing housing crisis – whilst raising advertising revenue by  promoting “reality” TV programmes that were far, far removed from many people’s own disturbing reality;

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According to UNICEF;

295,000 New Zealand kids are living beneath the poverty line, which means they are living in households where income is less than 60% of the median household income after housing costs are taken into consideration.

One way to alleviate poverty is to provide state housing, at minimal rental, to families suffering deprivation. Not only does this make housing affordable, but also strengthens a sense of community and reduces transience.

Transience can have deletarious effects on families – especially on children – who then struggle with the stresses of losing friends; adjusting to new neighbourhoods, and new schools.

A government report states that transience for children can have extreme, negative impact on  their learning;

Nearly 3,700 students were recognised as transient during the 2014 year. Māori students were more likely to be transient than students in other ethnic groups.

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Students need stability in their schooling in order to experience continuity, belonging and support so that they stay interested and engaged in learning.

All schools face the constant challenge of ensuring that students feel they belong and are encouraged to participate at school. When students arrive at a school part-way through a term or school year, having been at another school with different routines, this challenge may become greater.

Students have better outcomes if they do not move school regularly. There is good evidence that student transience has a negative impact on student outcomes, both in New Zealand and overseas. Research suggests that students who move home or school frequently are more likely to underachieve in formal education when compared with students that have a more stable school life. A recent study found that school movement had an even stronger effect on educational success than residential movement.

There is also evidence that transience can have negative effects on student behaviour, and on short term social and health experience

Writing for The Dominion Post, in April 2014, Elinor Chisholm and  Philippa Howden-Chapman pointed out the blindingly obvious;

Continuity of education and supportive relationships with teachers are critical for children’s educational performance.

“Churn” is not good for educational performance or enrolment in primary health care, where staff can ensure children are properly immunised and chronic health problems can be followed up.

It was for this reason that, in our submission on the Social Housing Reform Bill late last year, we strongly recommended that families with school- age children should be excluded from tenancy review.

Secure tenure and stability at one school would allow children the best chance of flourishing. In high- performing countries such as the Netherlands, children are explicitly discouraged from changing schools in the middle of the school year.

The bill had announced the extension of reviewable tenancies to all state tenants (new state tenants had been subject to tenancy review since mid- 2011). However, the housing minister, as well as the Ministry of Business, Innovation and Employment, had made clear that the disabled and the elderly were to be excluded from tenancy reviews.

In our submission, we acknowledged the Government for recognising the importance of secure tenure.

People who are compelled to move house involuntarily can experience stress, loss, grief and poorer mental health. Housing insecurity is also associated with poorer physical health.

National’s policy of ending a state “house for life”;  increased tenancy reviews for state house tenants, coupled with the sale of state houses, is inimical to the stabilisation of vulnerable families; the well-being of children in those families; and to communities.

In 2008, Housing NZ owned 69,000 rental properties.

By 2016, that number had dropped significantly to 61,600 (plus a further 2,700 leased).  National had disposed of some 7,400 properties.

Between 2014 and 2016, at least 600 state house tenants lost their homes after “reviews”.

This, despite our growing population.

This, despite John Key’s own family having been provided with the security of a state house, and Key enjoying a near-free University education.

This, despite John Key, ex-currency trader,  and multi-millionaire, admitting in 2011 that New Zealand’s under-class was growing.

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Key indicator #3: Incomes & Inequality

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In June 2014, Oxfam reported on New Zealand’s growing dire child poverty crisis;

The richest ten per cent of New Zealanders are wealthier than the rest of the population combined as the gap between rich and poor continues to widen.

Oxfam New Zealand’s Executive Director Rachael Le Mesurier said the numbers are a staggering illustration that the wealth gap in New Zealand is stark and mirrors a global trend that needs to be addressed by governments in New Zealand, and around the world, in order to win the fight against poverty.

“Extreme wealth inequality is deeply worrying. Our nation is becoming more divided, with an elite who are seeing their bank balances go up, whilst hundreds of thousands of New Zealanders struggle to make ends meet,” said Le Mesurier.

Figures for the top one per cent are even more striking. According to the most recent data, taken from the 2013 Credit Suisse Global Wealth Databook, 44,000 Kiwis – who could comfortably fit into Eden Park with thousands of empty seats to spare – hold more wealth than three million New Zealanders. Put differently, this lists the share of wealth owned by the top one per cent of Kiwis as 25.1 per cent, meaning they control more than the bottom 70 per cent of the population.

Oxfam New Zealand’s Executive Director, Rachael Le Mesurier, was blunt in her condemnation;

“Extreme inequality is a sign of economic failure. New Zealand can and must do better. It’s time for our leaders to move past the rhetoric. By concentrating wealth and power in the hands of the few, inequality robs the poorest people of the support they need to improve their lives, and means that their voices go unheard. If the global community fails to curb widening inequality, we can expect more economic and social problems.”

A 2014 OECD report placed New Zealand as one of the worst for growing inequality;

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Not only was inequality a social blight, but according to the report it impacted negatively on economic growth;

Rising inequality is estimated to have knocked more than 4 percentage points off growth in half of the countries over two decades. On the other hand, greater equality prior to the crisis helped increase GDP per capita in a few countries, notably Spain.

According to the OECD assessment,  income inequality had impacted the most on New Zealand, with only Mexico a close second;

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The OECD Report went further, making this “radical” observation;

The most direct policy tool to reduce inequality is redistribution through taxes and benefits. The analysis shows that redistribution per se does not lower economic growth.

The statement went on to “qualify”  any suggestion of socialism with a caveat. But the declaration that “analysis shows that redistribution per se does not lower economic growth” remained, constituting a direct contradiction and challenge to current neo-liberal othodoxy.

In August 2015, former City Voice editor, and now NZ Herald social issues reporter, Simon Collins revealed the growing level of child poverty in this country;

The Ministry of Social Development’s annual household incomes report shows that the numbers below a European standard measure of absolute hardship, based on measures such as not having a warm home or two pairs of shoes, fell from 165,000 in 2013 to 145,000 (14 per cent of all children) last year, the lowest number since 2007.

Children in benefit-dependent families also dwindled from a recent peak of 235,000 (22 per cent) in 2011, and 202,000 (19 per cent) in 2013, to just 180,000 (17 per cent) last year – the lowest proportion of children living on benefits since the late 1980s.

But inequality worsened because average incomes for working families increased much faster at high and middle-income levels than for lower-paid workers.

The net result was that the number of children living in households earning below 60 per cent of the median income after housing costs jumped from a five-year low of 260,000 in 2013 to 305,000 last year, the highest since a peak of 315,000 at the worst point of the global financial crisis in 2010.

In percentage terms, 29 per cent of Kiwi children are now in relative poverty, up from 24 per cent in 2013 and only a fraction below the 2010 peak of 30 per cent.

In September 2016, Statistics NZ confirmed the widening of  income inequality from 1988 to 2015,  between households with high  and  low incomes;

  • In 2015, the disposable income of a high-income household was over two-and-a-half times larger than that of a low-income household.
  • Between 1988 and 2015, the income inequality ratio increased from 2.24 to 2.61.  

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The neo-liberal “revolution” took place from the mid-to-late 1980s. Hardly surprisingly, the rise in income inequality takes place at the same time.

Income inequality dipped from 2004 when Labour’s “Working for Families” was introduced.

However, income inequality worsened after 2009 and 2010, when National cut taxes for the rich; increased GST (which impacts most harshly on low-income families and individuals); and increased user-charges on essential services such as prescription fees, ACC levies, court fees, etc. Increasingly complicated WINZ requirements for annual re-applications for benefits and complex paperwork may also have worsened the plight of the country’s poorest.

Despite all the promises made by the Lange government; the Bolger government; and every government since, our neo-liberal “reforms” have not been kind to those on low and middle incomes.

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Key indicator #4: Child poverty

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According to Otago University’s Child Poverty Monitor in 2014;

Child poverty has not always been this bad – the child poverty rate in the New Zealand many of us grew up in 30 years ago was 14%, compared to current levels of 24%.

Thirty years prior to 2014 was the year 1984. David Lange’s Labour Party had been elected to power.

Roger Douglas was appointed Minister of Finance. The Member for Selwyn, Ruth Richardson, was also in Parliament, taking notes.

The term “trickle down” entered our consciousness and vocabulary. It promised that, with tax cuts; privatisation; winding back state services; and economic de-regulation, wealth would trickle down to those at the bottom of the socio-economic ladder.

How is that working out for us so far?

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So much for  the “aspirational dream” offered to us by “trickle down” economics.

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Key indicator #5: The Real Beneficiaries

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In June last year, Radio NZ reported  the  latest survey of household wealth by Statistics NZ. It found;

“…the country’s richest individuals – those in the top 10 percent – held 60 percent of all wealth by the end of July 2015. Between 2003 and 2010, those individuals had held 55 percent. The richest 10 percent of households held half of New Zealand’s wealth, while the poorest 40 percent held just 3 percent of total wealth.”

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Following hard on the heels of the Stats NZ report,  Oxfam NZ made a disturbing revelation;

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Three years after her previous public warning,  Oxfam New Zealand’s, Rachael Le Mesurier, was no less scathing. Her exasperation was clear;

“The gap between the extremely wealthy and the rest of us is greater than we thought, both in New Zealand and around the world. It is trapping huge numbers of people in poverty and fracturing our societies, as seen in New Zealand in the changing profile of home ownership.”

National minister, Steven Joyce responded. He was his usual mealy-mouthed self when interviewed on Radio NZ about the Oxfam report;

“There’s always inequality but again you have got to look at those reports carefully because in that report a young medical graduate who has just come out of university would be listed as somebody who is in the poorest 20 per cent because they have a student loan.They’ll pay that student loan off in about four years and they’ll be earning incomes of over $100,000 very quickly.

So although they’re in those figures today, they won’t be in those figures in five years’ time.”

Which appears to sum up the National government’s head-in-sand attitude on child poverty and income inequality.

Economist, Shamubeel Eaqub, though, had a different “take” on the issue and warned;

“Every time we see a new statistic on inequality, whether it’s in terms of income, opportunities or wealth, it shows very clearly that New Zealand is being ripped apart by our class system.”

When economists begin to issue dire social warnings, you know that matters have taken a turn for the worse.

So where does that leave our New Dear Leader Bill English  with his insistence  that “we’ve got a government actually with a good record on addressing, in fact, some of the toughest social issues”?

English’s assertion to John Campbell on Radio NZ, on 25 January, (outlined at the beginning of this story) makes sense only if it it is re-phrased;

“We’ve got a government actually with a good record on addressing, in fact, some of the toughest wealth-accumulation issues. There may be disagreement over means by which we’re doing it, ah, but our direction is pretty clear. And you know over, certainly heading into election year we think that the approach the government’s developed around private investment, around increasing incomes for the wealthiest ten percent is the right kind of mix – “

Not a very palatable message – but vastly more truthful as income inequality continues to wreak appalling consequences throughout our communities and economy.

Otherwise, English appears to reside not so much in the Land of the Long White Cloud, but in the Realm of Wishful Thinking.

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References

Radio NZ: Checkpoint – Bill English on the challenges of his first month as PM

Scoop media: Unemployment rate rises to 5.2 percent as labour force grows

Statistics NZ: Household Labour Force Survey – Revisions to labour market estimates

NZ 1984 Yearbook: 3A – General SummaryCensus of population and dwellings 1981 (see “Tenure of Dwelling”)

Statistics NZ: Owner-Occupied Households

Statistics NZ: 2013 Census QuickStats about national highlights – Home Ownership

Interest.co.nz: Bernard Hickey says the collapse in home-ownership rates among families formed since 1991 is an unfolding disaster for NZ’s economy, our society and the Government’s finances

International Demographia: 13th Annual  International Housing Affordability

NZ Institute for Economic Research: The home affordability challenge

Monetary Meg: What is vendor finance?

Radio NZ: NZ immigration returns to record level

NZ On Screen: Revolution

NZ Herald: New Zealand residential property hits $1 trillion mark

Reserve Bank: Regulatory Impact Assessment of revised LVR restriction proposals September 2016 – Adequacy Statement

The Guardian: New Zealand housing crisis forces hundreds to live in tents and garages

Fairfax media: One in 100 Kiwis homeless, new study shows numbers quickly rising

Al Jazeera: New Zealand’s homeless: Living in cars and garages

NZ Herald: Homelessness rising in New Zealand

Radio NZ: Homeless family faces $100k WINZ debt

TV3 News: The hidden homeless – Families forced to live in cars

TV1 News: Housing crisis hits Tauranga, forcing families into garages and cars

UNICEF: Let’s Talk about child poverty

Education Counts: Transient students

Dominion Post: Housing policy will destabilise life for children

NZ Herald: State housing shake-up – Lease up on idea of ‘house for life’

Radio NZ: Thousands of state houses up for sale

Housing NZ: Annual Report 2008/09

Housing NZ: Annual Report 2015/16

Fairfax media: Nearly 600 state house tenants removed after end of ‘house for life’ policy

NZ Herald: Key admits underclass still growing

Oxfam: Richest 10% of Kiwis control more wealth than remaining 90%

NZ Herald: 300,000+ Kiwi kids now in relative poverty

Statistics NZ: Income inequality

Law Society: Civil court fee changes commence

Fairfax media: Prescription price rise hits vulnerable

Salaries.co.nz: ACC levies to increase in April 2010

Radio NZ: Thousands losing benefits due to paperwork

Scoop media: Health Issues Highlighted in Child Poverty Monitor

NZ Herald: Hungry kids foraging in pig scraps ‘like the slums of Brazil’

Fairfax media: Damp state house played part in toddler’s death

NZ Herald: More living in cars as rents go through roof

NZ Doctor: Tackle poverty to fight rheumatic fever

Radio NZ: 10% richest Kiwis own 60% of NZ’s wealth

Fairfax media: Wealth inequality in NZ worse than Australia

Radio NZ: Steven Joyce responds to Oxfam wealth inequality report

Additional

Dominion Post: Kids dragged from school to school

Other Blogs

The Standard: John Key used to be ambitious about dealing with poverty in New Zealand

Previous related blogposts

Lies, Damned lies and Statistical Lies

Lies, Damned lies and Statistical Lies – ** UPDATE **

National exploits fudged Statistics NZ unemployment figures

2016 – Ongoing jobless tally and why unemployment statistics will no longer be used

CYF – The Hollowing Out of a State Agency

The Mendacities of Mr Key # 18: “No question – NZ is better off!”

Foot in mouth award – Bill English, for his recent “Flat Earth” comment in Parliament

The Mendacities of Mr English – Fibbing from Finance Minister confirmed

Rebuilding the Country we grew up in – Little’s Big Task ahead

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This blogpost was first published on The Daily Blog on 7 February 2017.

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Letter to the editor – more silliness from former Nat President, Michelle Boag

20 July 2016 1 comment

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Frank Macskasy - letters to the editor - Frankly Speaking

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from: Frank Macskasy <fmacskasy@gmail.com>
to: Dominion Post <letters@dompost.co.nz>
date: Sun, Jul 17, 2016
subject: Letter to the editor

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The editor
Dominion Post

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On 17 July, on TVNZ’s Q+A, former National Party president. Michelle Boag, parroted the now oft-repeated cliche that “government don’t build houses”. This was in response to our worsening housing crisis.

Former Labour Party President, Mike Williams, duly corrected Boag by reminding her that successive Labour governments have built over 68,000 state houses to provide homes for the poorest and most vulnerable families. These homes give a roof over family’s heads and stability for children so that they may attend school on a regular basis.

Even our current esteemed Prime Minister once lived in a state house.

It seems to be a misguided notion by many on the Right of politics that governments “cannot do things”.

The power stations, transmission grid, roads, railways, schools, hospitals, airports, telecommunications system, state housing, and many other aspects to our modern lives are based on what successive governments and previous generations have built.

The $1.5 billion fibre-optic cable up-grade throughout the country is the latest investment by the State, for the benefit of all.

I suggest a refresher course in New Zealand history for Boag and her right-wing colleagues might be in order.

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-Frank Macskasy

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[address and phone number supplied]

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References

TVNZ Q+A: Housing Affordability -Panel

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housing - labour - national - michael savage

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Upper Hutt residents mobilise to fight State House sell-off

10 June 2016 6 comments

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Upper Hutt, NZ, 4 June – Residents in a State housing community in Upper Hutt are continuing to mobilise to strengthen opposition to planned sell-off of Housing NZ vacant land, and planned further demolition of so-called “un-safe, earthquake-prone” State houses.

Following from previous meetings organised by local community worker and activist, Teresa Homan (pictured on right);

.housing nz - state house sell off - upper hutt (4)

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– read out a petition to Bill English that has been launched calling on the withdraw of public-owned land in Trentham, Upper Hutt, from sale to private developers.

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petition to bill english

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[A full copy of the petition form can be downloaded here]

Ms Homan said she had already been gathering signatures and was “pleasantly surprised” that only a few people had refused to sign it.

Ms Homan represents the St Joseph Parish Justice, Peace, and Development Group. She said that the vacant land they were standing on had recently been filled with State housing that were homes to several families. She said some of families may have been relocated to other State houses further away in Timberlea, or private rentals elsewhere, up-rooting children from their local schools and disrupting their established education and local connections to the community.

Transience is a well-recognised problem for low-income families, as they do not have guaranteed security-of-tenure. A 2010 Ministry of Justice “working document” referred to hardship for vulnerable families, including transience;

Barriers to engagement in services by “hard-to-reach” groups include service level or structural barriers (e.g. location, hours of operation, cost, lack of awareness about availability, lack of cultural responsiveness, and poor coordination between services), and barriers specific to families and their situations (e.g. transience, low literacy, physical or mental health issues, domestic violence, lack of transport, low income, negative perceptions of services, and generally chaotic lives).

There is good evidence about how policy-makers and service providers can address these barriers and improve engagement by those who are hard-to-reach.

Ms Homan said the buildings had been torn down, ostensibly because they were “earthquake prone”. She added that that bulldozers and other wrecking machinary had had difficulty in tearing down the structures.

The land was now for sale to private developers. There is no guarantee that social housing will be built on the site. Ms Homan said she was fearful that Housing NZ would be moving fast to sell the land. She said,

“This is about this local community, but it’s also about land that we own as the public of New Zealand. So, once it’s [public land] sold, it’s gone. And it’s not about not allowing people to have private ownership of land, but this land’s owned by the New Zealand public.

…I think we need to hold onto the land we have for those families that can’t afford private [rental] homes.”

Ms Homan said she had been in contact with Housing NZ and when asked if they had claimed the demolished houses were the “wrong size, wrong place”, she agreed that statement had been used. She said she had lodged an Official Information Act (OIA) request  seeking an explanation why the houses had been deemed “wrong size, wrong place”.

[See related story: State houses – “wrong place, wrong size”?]

One State house tenant, Wayne (pictured below,  in wheelchair) has been waiting for a new state house for four and a half years that is better suited to his disability and use of a wheelchair;

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housing nz - state house sell off - upper hutt (8)

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Wayne said that whilst he had ramped access to his home, and a wet-area in the bathroom, that the rooms in his house and doorways  were too small to accomodate his frame and wheelchair. He said he was waiting for an appointment with Upper Hutt mayor, Wayne Guppy, to discuss his case.

About twenty people from the local  community turned up for the petition launch;

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housing nz - state house sell off - upper hutt (2)

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Their signs publicised the concerns they felt at how Housing NZ and the National government were impacting on their lives;

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housing nz - state house sell off - upper hutt (5)

 

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housing nz - state house sell off - upper hutt (6)

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housing nz - state house sell off - upper hutt (7)

 

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housing nz - state house sell off - upper hutt (9)

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One particular sign, bearing three simple words,  was hammered into the ground – a symbolic statement from the community to the National government and Housing NZ;

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housing nz - state house sell off - upper hutt (3)

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The size of the now-vacant land is considerable;

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housing nz - state house sell off - upper hutt (10)

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– especially when seen in conjunction with near-by properties;

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housing nz - state house sell off - upper hutt (11)

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Contrasting National Minister Paula Bennett’s recent announcement offering State house tenants $5,000 to leave Auckland, with the steady decline of state houses in the Hutt Valley, Rimutaka’s Labour MP, Chris Hipkins voiced his exasperation,

“So while the number of state houses in the Hutt Valley is shrinking, and people are being bumped off waiting lists because there aren’t enough houses available, the government have a genius idea to increase demand even further. This is just nuts.”

At a time of rising homelessness and on-going sell-off of Housing NZ homes and land, there is no indication that the National government is changing it’s policy-course. This is despite a recent public opinion poll which condemned National’s inaction of the worsening housing crisis;

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tv3-news-housing-poll

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Upper Hutt is just another community enjoying  National’s “Brighter Future”.

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References

Fairfax media: Answer to school transience needed

Ministry of Justice: Who is vulnerable or hard-to-reach in the provision of maternity, Well Child, and early parenting support services?

Radio NZ: $5000 moving grant ‘laughable’ without work

Upper Hutt Leader: HNZ land sell-off resisted

TV3 News: Government gets thumbs down on housing

Websites

Facebook: Upper Hutt State Houses 4 U

Facebook: Housing NZ Tenants Forum

Previous related blogposts

Government Minister sees history repeat – responsible for death

Housing Minister Paula Bennett continues National’s spin on rundown State Houses

Letter to the Editor – How many more children must die, Mr Key?!

National under attack – defaults to Deflection #1

Another ‘Claytons’ Solution to our Housing Problem? When will NZers ever learn?

National’s blatant lies on Housing NZ dividends – The truth uncovered!

National recycles Housing Policy and produces good manure!

Our growing housing problem

National Housing propaganda – McGehan Close Revisited

Housing; broken promises, families in cars, and ideological idiocy (Part Tahi)

Housing; broken promises, families in cars, and ideological idiocy (Part Rua)

Housing; broken promises, families in cars, and ideological idiocy (Part Toru)

National’s Food In Schools programme reveals depth of child poverty in New Zealand

Letter to Radio NZ – Homelessness, Poverty, and the Final Solution

State houses – “wrong place, wrong size”?

State house sell-off in Tauranga unravelling?

Other blogs

TangataWhenua.com: Veteran Activist hospitalised during removal of state houses (2012)

Copyright (c) Notice

All images stamped ‘fmacskasy.wordpress.com’ are freely available to be used, with following provisos,

» Use must be for non-commercial purposes.
» Where purpose of use is commercial, a donation to Child Poverty Action Group is requested.
» At all times, images must be used only in context, and not to denigrate individuals or groups.
» Acknowledgement of source is requested.

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This blogpost was first published on The Daily Blog on 5 June 2016.

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Budget 2016 – Who wins; who loses; who pays?

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Budget-2016

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The point is if we’re going to have a tax programme [of tax cuts] – we’re not ruling that out in for 2017 or campaigning on it for a fourth term. But having probably a bigger one, to be blunt.” – John Key, 16 May 2016

Philosophically we believe in lower taxes and smaller government, and government’s definitely getting smaller.”- John Key, 16 May 2016

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Paula Bennett denies there is a housing crisis in New Zealand;

I certainly wouldn’t call it a crisis. I think that we’ve always had people in need.” – Paula Bennett, 20 May 2016

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Paula Bennett announces plan to offer $5,000 to homeless and state house tenants to leave Auckland and go live in provinces;

I would say to those that are homeless that there is a chance that they could get a house in days if they were willing to look outside of Auckland.” – Paula Bennett, 25 May 2016

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Very quietly, a cut here and a decrease there, a failure to keep up with inflation in one place, and ignoring increasing population in another place, the Government is walking away from New Zealand’s longstanding social compact.

In his Budget speech, Bill English proudly says that government expenditure is down to less than 30 per cent of GDP, and that’s the way that it’s going to stay.

But how is this retreat from the economy achieved?

It happens by spending less on health and less on education, and not spending enough on housing for the least well off New Zealanders.–  Deborah Russell, 26 May 2016

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While it’s true the overall numbers of Housing NZ homes haven’t risen dramatically, the mix is changing and there are more in Auckland and less in places that we don’t need them.” – John Key, 27 May 2016

 

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Sadly, it seems once again that the Budget is a missed opportunity for children, while the military and Government spy agencies do extremely well. I don’t recall seeing any public opinion polls or evidence indicating the need for more investment in either of these areas, especially when there is such desperate need among families with children.

The Government has achieved its objective of appearing fiscally responsible and not much else. But through a lack of planning and an apparent lack of caring children are living in garages or cars, and do not have the nutrition or warm clothing that they need. Kiwi kids have a right to better lives than that.” – Vivien Maidaborn, New Zealand Executive Director, Unicef, 29 May 2016

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We would like to see some tax reductions, particularly for those middle income taxpayers who find themselves getting into higher tax brackets.” – Finance Minister Bill English, 27 May 2016

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There is absolutely zero doubt in my mind that the 2016 Budget is geared 100% toward building up a surplus for tax cuts to be announced next year. Just in time for the 2017 Election. John Key and Bill English have strongly indicated as much with their “kite-flying” with hints of cuts-to-come.

Funding for various state services have either barely increased – or drastically cut. The result has been a $700 million surplus – which appears to have been achieved at the expense of cutting funding for social NGOs and state services for the most vulnerable people in our society.

Some of the winners and losers from this year’s Budget…

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Winner

GCSB and SIS;

Funding for spy agencies (GCSB and SIS) will increase over the next four years by $178.7 million.

Loser

Department of Conservation;

For 2015/16 Budget, allocated $471,932,000

For 2016/17 Budget, allocated $430,190,000

Budget: Cut $41,742,000

Who Pays?

Endangered species throughout New Zealand and future generations of New Zealanders.

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Winner

Prime Minister’s Department;

For 2015/16 Budget, allocated $65,710,000

For 2016/17 Budget, allocated $77,442,000

Budget: Increase $11,732,000

Loser

Radio NZ;

For 2015/16 Budget, allocated $31,816,000

For 2016/17 Budget, allocated $31,816,000 (Based on zero change to NZ on Air funding; $128,726,000.)

Budget: frozen – nil increase since 2008/09.

Note, based on the Reserve Bank Inflation Calculator, Radio NZ’s funding should be around $36,570,000 and it’s funding freeze by National constitutes a 14.9% under-funding;

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reserve bank inflation calculator - radio nz funding

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Who Pays?

We all do.

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Winner

Education – Charter Schools;

Funding for up to seven new charter schools will be provided in the 2016 Budget, the Government has announced. – NZ Herald

$328.9m of capital funding and $20.2m of operating funding would go towards public private partnerships (PPPs) for seven new schools and three rebuilds. – Fairfax media

Loser

Public schools operation grants – frozen;

School operational funding has been frozen in this year’s Budget in favour of targeted funding for [under-achieving, at-risk] 150,000 kids.

[…]

$43.2 million over four years will be provided to those schools with under-achieving students, and it’s expected the money will be used to raise achievement, there’s no accountability attached to the funding.

[…]

The targeted funding works out at about $1.79 per student, per school week – schools won’t even know which students are being targeted as the policy’s designed not to identify them. – Fairfax media

Early Childhood Education subsidy-funding – frozen;

Early childhood education providers got no increase to their government subsidies for the second consecutive year.Radio NZ

Who Pays?

Our children.

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Winner

NZ military –

The Defence Force receives new operating funding of $300.9 million over four years as part of Budget 2016 to support the work it does, Defence Minister Gerry Brownlee says. – Gerry Brownlee, Minister of Defence

Loser

Home Insulation Programme –

National has cut home insulation funding to its lowest ever level in Budget 2016…

[…]

Budget 2016 allocates just $12 million this year for the Warm Up New Zealand programme this year and $4.5 million for the Healthy Homes programme, compared to $23.9 million for Home Insulation last year. – Scoop media/Green Party

Who Pays?

 

  • “low-income tenants, particularly those with high health needs.
  • …young children (newborns to 5-year olds) who are living in cold, damp and unhealthy homes.” – Jonathan Coleman, Simon Bridges

 

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There are three significant stand-outs for this Budget…

1 – This Surplus was achieved at the expense of the poor.

With school operational funding frozen; no increase for early childhood education funding;  a dire crisis of homelessness; State houses being sold of by National; and a critical shortage of housing – it does not take much wit to understand that Bill English’s $700 million Budget surplus was achieved by under-spending in key social areas.

Worse still, National continues to doggedly pursue it’s policy to sell up to eight thousand state houses  by 2017.

Compounding National’s mis-management of the country’s scandalous housing crisis is National’s unrelenting and inhumane demand for dividends from Housing NZ.

This far, National has extracted over half a billion dollars from Housing New Zealand by way of dividends.

Housing NZ dividends under National

HNZ Annual Report 2009-10 – $132 million   (p86)

HNZ Annual Report 2010-11 – $71 million   (p66)

HNZ Annual Report 2011-12 – $68 million   (p57)

HNZ Annual Report 2012-13 – $77 million   (p47)

HNZ Annual Report 2013-14 – $90 million –  (p37)

HNZ Annual Report 2014-15 – $108 million –  (p33)

HNZ Statement of Performance Expectations 2015/16 – $118 million – (p12)

Total: $664 million (over seven years)

The above figures do not include taxes paid by Housing NZ to the National government.

Imagine how many state house could have been built by Housing NZ in the last seven years.

Imagine that every low-income family that needed a warm, dry, home – could have had one by now.

Imagine that instead, National will be demanding another dividend this year from Housing NZ – and will be effectively giving it away by means of tax-cuts to affluent New Zealanders.

2 – Many so-call “increases” are illusory.

When taken over a four year period many of English’s Budget “increases” are actually a cut in expenditure. Just two examples from many;

School  funding for 150,000 under-achieving, at-risk school children, was budgeted at  $43.2 million This sounds good. But that figure is spread not over the 2016/17 period – but  over four years.

Same with the Warm Up New Zealand and Healthy Homes Initiative, touted by Ministers Coleman and  Bridges as;

“…to insulate rental houses occupied by low-income tenants, particularly those with high health needs” and “to reduce preventable illnesses among young children (newborns to 5-year olds) who are living in cold, damp and unhealthy homes”

The media release touted;

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$36m for warmer, healthier homes

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But look further into the detail;

The investment includes:

  • $18 million of operating funding over two years to extend the Warm Up New Zealand programme to insulate rental houses occupied by low-income tenants, particularly those with high health needs.

  • $18 million over four years to expand the Healthy Homes Initiative to reduce preventable illnesses among young children (newborns to 5-year olds) who are living in cold, damp and unhealthy homes.

This is how English created his Budget “surplus” – with cleverly concealed cuts to social programmes that impact on the poorest; most powerless; most desperate people in our society.

And we wonder why entire families are living in garages, cars, and tents?

And we wonder how it came to be that children are dying from mould in damp houses?

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Damp state house played part in toddler's death

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3 – This is an Ideological Budget

Make no mistake – this was an ideological budget with “Neo-Liberal Approved” stamped in big, red letters all over it. It was cold-blooded and remorseless in it’s pursuit of specific objectives;

  • reducing government spending on the poor, by freezing/cutting expenditure on social services
  • increased government spending on security agencies (spy, defence, police), in case the 1981 up-rising is repeated
  • satisfying demands from National’s business, conservative, and anti-welfare constituents
  • to give Bill English a second surplus
  • set the stage for tax cuts to be announced in next years’ budget
  • and offer an electoral bribe to voters in time for the 2017 general election

As is almost always the case, those at the bottom of the socio-economic heap are the ones who pay for National’s ideologically-inspired budget. Sometimes they pay with their lives.

Expect more of the same next year.

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Addendum

Spotted at a Z Service Station in the Hutt Valley; this Charity “voting” box, where customers vote for the charity of their choice. The charity gaining  most tokens wins a $4,000 donation from Z. Of the four, Fostering Kids NZ is ‘miles’ ahead with tokens;

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Manpreet, standinmg beside Coin-Vote Box, at Z Service Station in Hutt Valley

Z staffer, Manpreet, standing beside Coin-Vote Box, at a Service Station in the Hutt Valley

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Note the level of support for Fostering Kids NZ;

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Fostering kids - charity - homelessness - budget 2016 (2)

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It is refreshing to see indications that  New Zealanders are still compassionate to children  from vulnerable, less well-off families. There is still hope for our society, even if people like Key, English, Bennett, Tolley, et al have turned their heads to look the other way.

Acknowledgement: Many thanks to Deborah L for her sharp eye, spotting, photographing, and sending me the above images along with relevant info.

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References

Fairfax media: Prime Minister John Key hints at $3billion tax cuts for next election

Fairfax media: John Key is beating the tax cuts drum for 2017 with bigger surpluses ahead

Radio NZ: No housing crisis in NZ – Paula Bennett

Interest.co.nz: Paula Bennett announces plan to offer $5,000 to homeless Aucklanders and state house tenants to leave Auckland

NZ Herald: Dr Deborah Russell – Budget 2016 – How do we look after all New Zealanders?

Radio NZ: Checkpoint – PM puts onus on Auckland Council to create land supply

Fairfax media: Budget 2016 – A bare-minimum budget for children

Radio NZ: Tax cuts may be on cards – English

NZ Herald: Budget 2016 – $700m surplus this year

Radio NZ: Budget 2016 – SIS and GCSB get extra $178.7 million over four years

Budget 2016: Vote Conservation

Treasury: Budget 2016 – Vote Prime Minister & Cabinet

Budget 2016: Vote Arts, Culture and Heritage

NZ on Air: Radio NZ Funding Decisions 1993-2016

Reserve Bank: Inflation Calculator

Budget 2016: Vote Education

NZ Herald: New charter school funding announced

Fairfax media: Budget 2016 – School property and early childhood the big winners

Radio NZ: Budget promises funding for nine new schools

Treasury: Summary of Initiatives in Budget 2016

Budget 2016: Defence Force receives $301m new funding

Scoop media: Government cuts Warm-Up programme that saves lives

Beehive.co.nz: $36m for warmer, healthier homes

Radio NZ: Thousands of state houses up for sale

Fairfax media: Damp state house played part in toddler’s death

Interest.co.nz: Govt sees NZ$0.7 bln OBEGAL surplus in 2016/17

TV3 The Nation: Interview with Bill English

Additional

NZ Herald: Shamubeel Eaqub – House crisis puts Auckland’s future at risk

Other bloggers

The Daily Blog: Budget 2016 – What Bill English Didn’t Say In His Speech

The Daily Blog: The rules for the old too good for children?

The Standard: The Mother Budget

The Standard: Key’s powerful speech on the urgent housing crisis

The Standard: John Key used to be ambitious about dealing with poverty in New Zealand

The Standard:  Budget 2016 – F for Fail

Previous related blogposts

Tax cuts & school children

Tax cuts and jobs – how are they working out so far, my fellow New Zealanders?

The Mendacities of Mr Key #3: tax cuts

Letter to the Editor – tax cuts bribes? Are we smarter than that?

National spins BS to undermine Labour’s Capital Gains Tax

John Key’s government – death by two cuts

A Message to Radio NZ – English continues fiscal irresponsibility with tax-cut hints

The consequences of tax-cuts – worker exploitation?

The slow starvation of Radio NZ – the final nail in the coffin of the Fourth Estate?

National’s blatant lies on Housing NZ dividends – The truth uncovered

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give the rich tax cuts

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This blogpost was first published on The Daily Blog on 2 June 2016.

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State house sell-off in Tauranga unravelling?

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State Houses – “Wrong place/wrong size”?

Last year (2015), National confirmed it’s intention to sell-off thousands of state houses to “community groups”;

Hundreds of state houses in Tauranga and Invercargill could be sold to independent providers in the first phase of the Government’s plans.

In January Prime Minister John Key announced that state house reforms would see up to 2000 state homes sold to “community housing providers” this year, as it cuts the number of state houses it owns by 8000 over three years.

Although the Government was marketing the process as “transfer” the houses would be sold to community groups, generally charity based providers. Because the houses would have to be kept as social housing rather than private sales, the houses were expected to be sold at a discount to the market value.

After nationwide consultation, Housing New Zealand Minister Bill English and Social Housing Minister Paula Bennett said that the first sales were likely to take place in Invercargill and Tauranga.

In a blogpost in November last year, I pointed out the oft-repeated phrase used by our esteemed dear Leader and various Ministers;

Various ministers, including our esteemed Dear Leader,  have indicated that up to “a third” of state houses are “in the wrong place or wrong size (or ‘type’).

The “wrong size/wrong place” claim is the argument used by National to advance a major sell-off of Housing NZ properties.

On 1 November, 2014, Social Housing Minister Paula Bennett said on TV3’s ‘The Nation’,

“It’s about being smart in what we’re doing. So you just look at us having the wrong houses, in the wrong place, of the wrong size..”

On 2 December, 2014, the Minister responsible for Housing NZ, Bill English expressed his agreement with the proposition of one third of Housing NZ homes being in the “wrong size/wrong place” ;

“Yes. As recently as just last month Housing New Zealand issued a press release that said: ‘around one third of our housing stock is in the wrong place, wrong configuration or is mismatched with future demand’.

[…]

… in fact, a third of them are the wrong size, in the wrong place, and in poor condition.”

On 28 January this year, John Key announced in his “state of the nation” speech;

 “Around a third of Housing New Zealand properties are in the wrong place, or are the wrong type to meet existing and future demand.”

After lodging an OIA request with relevant Ministers late last year information released under the  Act suggests that National’s oft-repeated claim that around “one third” ( or 22,000)  of  state houses are in the “wrong place and wrong size” was not wholly supported by Housing NZ’s own figures. As I reported last November;

Housing NZ currently  “manages 67,245 homes” (as at 30 June 2015). When Key, and other National ministers refer to “around a third of Housing NZ properties”, simple arithmetic translates that fraction into 22,190 homes being the “wrong size/wrong place” .

[…]

In a response eventually received on  29 October 2015,  information in the form of a  chart -“Stock reconciliation taking into account impaired properties as at 31 January 2013” – was attached;

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minister english oia response 29 october 2015 - HNZ housing stock - wrong place wrong size

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In two columns headed “Right Place, wrong home” and “Wrong Place“, the respective figures add up to 13,560. This constitutes a little over half of the “22,000” that is being bandied about by National.

Like much of National’s “facts”,  the numbers did not stack up.

Which led to the last question I put to the Minister; “If HNZ houses that are in the “wrong place” are sold/given away to community organisations – what will make those houses suddenly become in the “right place”?

Because if it’s in the “wrong place” when owned by Housing NZ – why would it suddenly be in the “right place” owned by someone else?

The Minister’s response was baffling. In his 29 October 2015 letter to me he said;

“The Government has no plans to offer Housing New Zealand properties that have been
identified as being in the ‘wrong place’ to community housing providers. In Tauranga and
Invercargill for example, the areas identified for initial potential transfers of social
housing properties from Housing New Zealand to community housing providers, MSD’s purchasing
intentions anticipate stable demand. Following a transfer, any new provider would receive
both the properties and a contract with MSD to continue to provide social housing.”

[See full text of letter here]

English’s response seemed to cast a distinction between State housing “in the wrong place/size” and properties to be sold/transferred to community organisations.

Yet, his statement above would appear to contradict a statement issued by English and Bennett earlier on 6 May last year, which is explained further below under the heading, “The Great Invercargill and Tauranga Sell-Off”.

See: State houses – “wrong place, wrong size”?

State Houses, “Wrong place/wrong size”? – Up-date

English’s responses to my questions were vague and offered little in the way of specific detail. In a follow-up letter to the Minister, I repeated two of my questions;

I refer you to two questions which you have not answered in my OIA request;

4. Where are they situated that are considered the “wrong place”?

5. How many areas have been designated “wrong places”?

His response arrived too late to be included in my November 2015 blogpost, but is still highly relevant to the growing housing crisis in this country. On 9 December 2015, English said;

“The analysis produced by Housing New Zealand  in 2013 and provided to you with my previous response [see table here – FM] identifies  the number of houses as being in the wrong place on a regional basis. No specific locations have been designated ‘wrong places’ and, based on this analysis, each region has some properties assessed as being in the wrong place. These will generally be in provincial  areas away from the main centres.”

[See full text of letter here]

In none of the Minister’s correspondence was he able to provide specifics as to where State houses were in the “wrong place”. The ‘best’ he could do was list five regions; Auckland East & South; Auckland North West & Central; South Island, Central North Island, and Lower North Island.

Surprisingly, Auckland was deemed to have  8,180 houses  that are supposedly “Right Place, wrong home”  and a further 420 that are in the “Wrong Place” – 8,600 in total.

However, the Minister’s data was contradicted by the 2014/15 Housing NZ Annual Report which confirmed the on-going high demand for housing in Auckland;

“Across the country we also have too many three-
bedroom properties, while demand has grown for smaller
one- or two-bedroom homes or for much bigger homes.
Demand for homes in the Auckland region is high and
more Housing New Zealand homes are needed.” (p22)

English did, however, point out that “these will generally be in provincial  areas away from the main centres“.

Even that has proven to be a mis-leading assertion from the Minister. Tauranga is certainly a “main centre” by most definitions, and the choice of that city would  prove to be embarrassing to National, as the next chapter below showed.

The Great Invercargill and Tauranga Sell-Off

As National began to roll  out it’s sale of State houses, Bill English specifically referred to State houses being sold in  Tauranga and Invercargill. On 6 May last year, Bennett and English released this statement;

“This is another important step to creating a more effective and efficient social housing sector with more housing providers supporting tenants and their needs.” – Housing New Zealand Minister Bill English.

As announced by the Prime Minister in January, the Government’s Social Housing Reform Programme includes plans to transfer 1000 – 2000 HNZC houses to registered CHPs over the next year.

“We’ve gone through a robust process to identify the first areas for potential transactions. Tauranga and Invercargill have been chosen because they have stable demand for social housing, and active community housing providers keen to consider the next steps. Providers in other regions are also interested.” – Social Housing Minister Paula Bennett

The same media statement referenced;

The Social Housing Reform Programme (SHRP) is designed to get more people in need into quality social housing – either through Housing New Zealand Corporation (HNZC) or registered Community Housing Providers (CHPs). The objectives of the Social Housing Reform Programme are to:

  • […]

  • Ensure social housing is the right design and size and is in the right places for people who need it.

English and Bennett continued to exploit the “wrong size/wrong place” spin that National was using to disguise the privatisation of State housing.

Bear in mind English’s statement in his 29 October 2015 letter to me, where he said;

“The Government has no plans to offer Housing New Zealand properties that have been
identified as being in the ‘wrong place’ to community housing providers. In Tauranga and
Invercargill for example, the areas identified for initial potential transfers of social
housing properties from Housing New Zealand to community housing providers, MSD’s purchasing
intentions anticipate stable demand. Following a transfer, any new provider would receive
both the properties and a contract with MSD to continue to provide social housing.”

Obviously the Ministers find it difficult to keep their “story” straight.

In March this year, potential buyers for State houses in Tauranga and Invercargill had been lined up;

Four potential buyers have made the final shortlist to buy over 1400 state houses being sold in Tauranga and Invercargill.

[…]

In Tauranga, Accessible Properties, Hapori Connect Tauranga, and Kaiana Community Housing Partners made the shortlist to take over 1124 properties or tenancies.

However, even as National’s English and Bennett were prepping State houses for sale, the country’s housing crisis began to be reported elsewhere throughout New Zealand.

Tauranga was one of them;

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Housing situation critical - Tauranga principal - radio nz

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Tauranga gripped by housing crisis - sunlive

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Housing crisis hits Tauranga, forcing families into garages and cars - TVNZ TV1 News

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Community leaders, social agencies call for urgency on 'housing crisis' - bay of plenty times

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People living in caravan parks while waiting for a rental - bay of plenty times

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Campsites for emergency housing debate - bay of plenty times

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People resorting to living in camping sites and caravan parks?

Is that what this country has come to after thirty years of neo-liberal “reforms”? To become a South Pacific version of America’s trailer-park “communities”?

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trailer park community USA

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If, by shuffling ownership of State houses from Housing NZ to “community groups”, National believes it will solve our housing crisis and growing homelessness – they are far more out of touch than I ever thought possible.

This is not just a stubborn pursuit of a free market dogma that has failed to meet basic social needs – this is pseudo-religious self-delusional behaviour from our elected representatives. English, Key, Bennett, Smith, et al, appear to be paralysed into inaction, like possums caught in the headlights of an approaching truck.

Nowhere is this better illustrated than Social Housing Minister Paula Bennett floundering around like a beached cetacean. She first denied that a housing crisis existed in New  Zealand on 20 May;

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No housing crisis in NZ - Paula Bennett - radio nz

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Five days later, she was willing to bribe homeless and State housing tenants up to $5,000 to quit Auckland, making  a sudden announcement that caught Finance Minister Bill English off-guard;

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Paula Bennett announces plan to offer $5,000 to homeless Aucklanders and state house tenants to leave Auckland

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I have said it before and will repeat my conclusions that National is incapable of resolving this crisis. Considerable State intervention is required, and that is anathema to a political party whose very DNA is based on the free market; reducing State involvement in commercial and social activities; and promoting private good over community benefit.

It will take a collective anger from New Zealanders to take notice of what is happening in their own society. At the moment, so many New Zealanders seem insulated from the  growing social problems that are worsening with each passing day.

As Shamubeel Eaqub said on Radio NZ’s Checkpoint, on 26 May, there is an absence of empathy amongst many New Zealanders – a moral-disconnect with the poor; the homeless; those who have been left behind after thirty years of failed neo-liberal theory.

Remarkably, Eaqub invoked the name of Michael Savage, when New Zealanders were capable of building and solving social ills. For an economist,  Eaqub has deep insight where we have arrived in the year 2016;

The only thing that’s missing now is aspiration and leadership,” he said.

Perhaps our economist friend has nailed the problem perfectly; 21st century New Zealand is not just suffering from economic poverty. There is a poverty much, much worse.

A poverty of spirit.

And that affects us all, regardless of wealth and income.

 

 

 

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References

Fairfax media: Invercargill and Tauranga chosen for first state house sales

TV3: The Nation – Social Housing Minister Paula Bennett

Parliament: 6. State Housing—Suitability of Housing Stock

Fairfax media: John Key Speech – Next steps in social housing

Letter from Bill English, 9 December 2015

Housing NZ: 2014/15 Annual Report

Beehive.govt.nz: Next steps in social housing reform announced

Fairfax media: Invercargill state houses may survive sell-off as Government reveals short-list

Radio NZ: Housing situation critical – Tauranga principal

Sunlive: Tauranga gripped by housing crisis

TVNZ News: Housing crisis hits Tauranga, forcing families into garages and cars

Bay of Plenty Times: Community leaders, social agencies call for urgency on ‘housing crisis’

Bay of Plenty Times: People living in caravan parks while waiting for a rental

Bay of Plenty Times: Campsites for emergency housing debate

Radio NZ: No housing crisis in NZ – Paula Bennett

Interest.co.nz: Paula Bennett announces plan to offer $5,000 to homeless Aucklanders

Radio NZ: Airport CEO, health leader & economist look at the Budget

Additional

Dominion Post: Housing MPs cost taxpayers more

Treasury: Social Housing Transactions

Other bloggers

The Daily Blog: Paula Bennett blindsides her own Finance Minister in desperate scramble to respond to housing crisis

The Standard: Newshub poll – Key’s government has failed on housing

The Standard: Bennett’s housing “announcement” is a re-announcement and a lie

Previous related blogposts

Can we do it? Bloody oath we can!

State houses – “wrong place, wrong size”?

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emmerson - homeless - National govt housing

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This blogpost was first published on The Daily Blog on 27 May 2016.

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The Mendacities of Mr Key #8: A roof over your head, and boots on the ground

15 February 2015 4 comments

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boots and homes

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Recent Timeline of Events: Iraq

18 June 2014

Prime Minister John Key has ruled out sending special forces soldiers to Iraq as the United States mulls options in response to the unfolding crisis there.

Speaking in New York, Key said the New Zealand Government was looking at what humanitarian aid it might provide as tens of thousands of Iraqis have been displaced by a violent takeover of parts of the country.

He said it was high unlikely New Zealand would put “boots on the ground” in Iraq in terms of combat troops.

“We’re not a country out there looking for a fight.” – Source

 

Prime Minister John Key has ruled out New Zealand military intervention in Iraq, barring an unlikely United Nations Security Council mission.

Mr Key, who is in the United States on a four-day tour, told media that New Zealand wouldn’t send SAS troops to Iraq in a training role, or troops in a non-combat role, as Sunni militants approach Iraq.

“I don’t see New Zealand overly getting tied up in that. That wouldn’t be something we’d want to do,” he said at a visit to the September 11 memorial site in New York.

[…]
“We said we would only respond to a UN Security Council mandate for any humanitarian assistance,” he said on Firstline this morning.

“We are a loyal and active member of the international and the UN. If there’s a UN operation and it’s non-combat down the track, then that is something we could consider.” Source

20 September 2014

National wins third term in government, with United Future, ACT, and Maori Party support.

30 September 2014

New Zealand’s elite Special Air Service (SAS) personnel are not yet on standby for deployment to combat Islamic State militants in Iraq or Syria, Prime Minister John Key says, but he won’t rule out sending them if asked “as a last resort”.

[…]

Asked whether he would send military personnel if requested, Mr Key said: “I can’t rule out that there won’t be because what you can see around the world is countries being asked to give support.”

As far as sending SAS personnel, Mr Key said: “I can’t rule that absolutely out, but what I can say is that I’ll get advice and we’ll see how that goes, but it would be my least preferred option.”Source

5 November 2014

Kiwi military personnel are on their way to Iraq as New Zealand swings in behind the fight against the Islamic State group.

Defence Minister Gerry Brownlee confirmed three unarmed military personnel left for Iraq this week to assess how New Zealand could help the fight against the Islamic State group…  Source

 20 January 2015

The Government will make a decision in the next month or so about whether to send training forces to Iraq, Prime Minister John Key says.

[…]

The prime minister said…

“We are going through that process of doing the [reconnaissance] to see whether it’s logical for New Zealand to take the next step, whether we should do that with Australia, whether we can find a location that fits the criteria that I set in my national security speech late last year.

“My guess is that by the middle of February or late February we’ll be in a better position to assess whether we are actually going to put people into Iraq to train Iraqi forces.” Source

 

Recent Timeline of Events: Housing

24 February 2014

Prime Minister John Key is ruling out any further sales of state assets, once Genesis Energy is partially sold.

[…]

However, he said there are no more state-owned companies that would make sense to partially sell, with New Zealand Post facing declining business and Transpower operating as a monopoly.

“The truth is that there aren’t a lot of other assets that would fit in the category where they would be either appealing to take to the market or of a size that would warrant a further programme. Or they sit in the category where they are very large, like Transpower, but are a monopoly asset and so aren’t suited I think.” Source

20 September 2014

National wins third term in government, with United Future, ACT, and Maori Party support.

28 January 2015

Prime Minister John Key today confirmed the Government planned to sell 1000 to 2000 state houses in the next year to community-housing providers, with with more sales possible in coming years. – Source

 

“It’s definitely not [an asset sale],” says Mr Key. “The overall focus here is to accommodate more New Zealanders in social housing.” – Source

On 9 February, on Radio NZ, Labour’s Phil Twyford outlined how state houses passed into ownership of community organisations could inevitably fall into the ownership of banks, and then on-sold.
Key claimed on Radio NZ’s Morning Report;

“There will be a contract formed between the Government and the community housing providers that buy the houses. The community housing provider won’t be able to on-sell the house unless they have the permission of the Government. To get the permission of the government, the government would have to consider why the community housing provider wanted to do that.”

Considering that Key has a solid reputation for saying one thing, and then months later back-tracking, there is no reason to believe him or take him at his word. His recent one-eighty degree u-turns on New Zealand involvement in Iraq and selling state assets (housing stock) has sent Key’s credibility plummeting.

The thing that people look to for Key now is not rock-solid committments – but what excuses/technique he will use to break his promises.

Prior to last year’s election, Key unequivocally promised

(a) Not to send combat troops to Iraq,

(b) not to sell any further state assets after Genesis.

It seems that we can now expect;

(a) New Zealand combat troops in Iraq, under the cover of “training” Iraqi soldiers,

(b) State houses being sold to various groups, which will eventually end up in private ownership.

The man simply cannot be trusted.

If his public popularity was not so unfeasibly high, there would be unrelenting, growing  pressure calling for  his resignation.

John Key has obviously learned the trick how a politician can break promises; tell lies; and yet maintain the public’s confidence and his own popularity. He is either an expert manipulator – or the public have become increasingly dumber/dumbed-down in the last decade.

Considering the state of public television, one could be tempted to opt for the latter.

Interestingly, not one journo seems to have asked Key three simple questions regarding NZ troops in Iraq or the sale of state housing to community organisations and others;

(a) “Will NZ troops  in Iraq – supposedly on ‘training missions’ – be given indemnity from prosecution by the Iraqi government? If so – why?

(b) “How will the transfer of ownership of a house from the State, to another entity, increase the number of houses in the country? And by how many?”

(c) How many people on the Housing NZ waiting-list  will actually be moved into community housing?

The first journo to ask Key those questions will open a can of worms that, for the first time, may attract public attention and scrutiny to Key’s mendacities and National’s barely concealed activities.

The public may not like what they see when they begin to pay attention to the government they elected.

Especially when the Housing NZ waiting list continues to rise.

And the first body bags return to New Zealand.

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References

Fairfax media: No New Zealand forces to Iraq, says Key

TV3: Key rules out sending troops to Iraq

NZ Herald: Key – SAS could join Isis fight on ground

Fairfax media: NZ military personnel headed for Iraq

Radio NZ: Iraq troop decision weeks away

Radio NZ: PM rules out more asset sales

Fairfax media: Government to sell 1000 – 2000 state houses – John Key

Radio NZ: State houses sale ‘financial risk’

Radio NZ: PM surprised by turn of events in Australia

Additional

Fairfax media: Andrea Vance – Think twice before joining new Iraq war

Previous related blogposts

Letter to the editor – Key paints a dirty, great, big bullseye on our country!

Housing; broken promises, families in cars, and ideological idiocy (Part Tahi)

Housing; broken promises, families in cars, and ideological idiocy (Part Rua)

Housing; broken promises, families in cars, and ideological idiocy (Part Toru)

The Mendacities of Mr Key #7: What is Dear Leader actually saying here?


 

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housing endangered

Above image acknowledgment: Francis Owen/Lurch Left Memes

This blogpost was first published on The Daily Blog on 10 February 2015.

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