Our Wellington

News | 3 June 2021

Council seeks talks on social housing

Wellington City Council’s Pūroro Rangaranga Social, Cultural and Economic Committee met this week to confirm the Council’s commitment to social housing and agree a pathway forward to resolving the financial challenges relating to social-housing provision.

Kotuku Apartments

The committee agreed to seek direct access to the Government’s Income Related Rent Subsidy (IRRS) and request formal negotiations between Mayor Andy Foster and Hon Dr Megan Woods, the Minister of Housing.

Mayor Andy Foster says Wellington City Council is one of New Zealand’s largest landlords, supporting some of our city’s most vulnerable people. “Without access to IRRS, both the quality of these people’s homes and their financial security are deeply affected. Without access our social housing portfolio is financially unsustainable, and we cannot allow this situation to continue to deteriorate.”

Councillor Jill Day, Chair of Pūroro Rangaranga, adds: ‘Without direct access to the subsidy, tenants are facing increasingly unaffordable rents.”

Councillor Fleur Fitzsimons says: “We are disappointed the Council cannot access the IRRS directly and are seeking formal negotiations with the Government to review this legislation.”

The City Council remains committed to better outcomes for City Housing tenants. If the Council and its tenants cannot gain direct access to IRRS, establishing a Community Housing Provider entity will have to be considered.

The committee yesterday also instructed officers to commence work in parallel with the direct approach to investigating establishing a Community Housing Provider entity, and a special-purpose vehicle for funding the second half of the housing upgrade programme.

This will require the negotiating of the Council’s Deed of Grant with the Crown. In 2007 the Council signed the Deed to deliver a $400 million upgrade of its social-housing stock. The Crown contributed $220 million to upgrade the first half of the housing portfolio and the Council committed to contributing $180 million to fund the second half of the housing upgrade.

Council officers are working proactively with the Ministry of Housing and Urban Development on these negotiations. It could take up to 18 months for detailed design and consultation on a Community Housing Provider entity and a further 19 months to become fully operational.

An option for the structure will be presented to Councillors in September 2021. Funding for City Housing and the upgrade programme has been budgeted for in the 2021-31 10-Year Plan through this transition time.