Law change ends lifetime right to state house

Last updated 05:00 21/11/2013

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A cornerstone of New Zealand's welfare system, the state house for life, has passed into history.

A law change has turned the state house system on its head by introducing reviewable tenancies and giving tenants in social housing provided by non-government organisations access to the same rent subsidy as Housing New Zealand.

The subsidy applies to low-income earners and means they pay no more than 25 per cent of their income on rent. Previously, people had to be in a state house to qualify.

Housing Minister Nick Smith said that, and the promise of a state house for life, had created inequities.

"It is poor policy that Housing New Zealand has 4000 tenants whose incomes are sufficiently high to pay a market rent, but who are legally entitled to occupy that house forever, while we have an equivalent number of high-needs families on a waiting list unable to be housed."

He cited the case of a Nelson fishing boat captain who had remained in the same state house even after his income rose to more than $100,000 a year.

"A person living in a state house earning over $100,000 a year has . . . a legal right to stay in that house forever."

The Government will spend $46.8 million over the next two years implementing the law change as it moves 3000 people out of state houses.

Labour's housing spokesman, Phil Twyford, accused Dr Smith of hypocrisy and said he had remained in his ministerial home for six weeks after being sacked as a minister because it would disrupt his children's schooling.

"That is an outrageous double standard."

Forcibly evicting people disrupted stable communities and neighbourhoods, Mr Twyford said.

The first state houses were built in the early 1900s for inner-city workers under a programme that folded in 1919. In 1935 the first Labour government announced a plan to provide homes for people left jobless after the Depression. The 5000th state house was built in 1939 and the programme was stepped up after World War II, when 10,000 homes a year were being built.

In the 1990s National scrapped income-related rents, but they were reinstated when Labour was voted back into power in 1999.

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- Fairfax Media

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