State housing
Encyclopedia
Public housing
Public housing is a form of housing tenure in which the property is owned by a government authority, which may be central or local. Social housing is an umbrella term referring to rental housing which may be owned and managed by the state, by non-profit organizations, or by a combination of the...
offered to New Zealand
New Zealand
New Zealand is an island country in the south-western Pacific Ocean comprising two main landmasses and numerous smaller islands. The country is situated some east of Australia across the Tasman Sea, and roughly south of the Pacific island nations of New Caledonia, Fiji, and Tonga...
residents on low to moderate incomes. Some 66,000 houses are managed by Housing New Zealand Corporation
Housing New Zealand Corporation
Housing New Zealand Corporation is a Crown agent that provides housing services for New Zealanders in need. It is also the New Zealand Government's principal advisor on housing. Housing New Zealand is a statutory corporation set up under the Housing Corporation Act 1974, as amended by the Housing...
, most of which are owned by the government.
The Liberal Government
Urban working-class housing in New Zealand in the 19th century was of poor quality, with overcrowding, flimsy construction, little public space, often-polluted water, and lack of facilities for disposal of rubbish or effluent. Local bodies were not interested in enforcing existing regulations, such as minimum street widths, which might have improved housing, or in prosecuting slum landlords.The Liberal Government
First Liberal Government of New Zealand
The First Liberal Government of New Zealand was the first responsible government in New Zealand politics organised along party lines. The Government formed following the founding of the Liberal Party and took office on the 24 January 1891, and governed New Zealand for over 21 years until 10 July...
, first elected in 1890, believed that the slums would cease to be a problem as workers moved to the country to become farmers or small town merchants. Instead, the cities continued to grow. A parallel idea of making Government-owned land on the outskirts of cities available for workers to create smallholdings failed to gain traction because the cheap commuter trains which might have transported them to their workplaces were not established, and the Government did not provide loans for building or allow the purchase of freehold land in the areas.
Prime Minister Richard Seddon
Richard Seddon
Richard John Seddon , sometimes known as King Dick, is to date the longest serving Prime Minister of New Zealand. He is regarded by some, including historian Keith Sinclair, as one of New Zealand's greatest political leaders....
introduced the Workers' Dwellings Act in 1905 to provide well-built suburban houses for workers who earned less than £156 per annum. He argued that these houses would prevent the decline of living standards in New Zealand and increase the money available to workers without increasing the costs to employers. By breaking private landlords' control over rental housing, housing costs for everyone would decline. The bill passed by 64 votes to 2, despite criticism over the cost of the scheme, the distance the houses would be from workplaces, particularly ports, and the lack of provision for Māori. Seddon estimated that 5,000 houses would be built under the scheme.
The Act allowed for workers to rent weekly, lease for 50 years with a right of renewal, or lease with the right to buy over a period ranging between 25 and 41 years. In practice, the Government did not initially advertise the weekly rental, but emphasised the lease with the right to buy. The Act specified that workers could be male or female, but women were discouraged from applying for the houses because the Government was concerned that "houses of ill-repute" might be established.
The standard of materials and construction was high, because the Government was determined that the houses would not become slums. The Act specified that the rent was to be 5% per annum of the capital cost of the house and land, together with insurance and rates. The initial specification was that houses should cost no more than £300, but this was raised to £350-400, depending on construction materials, by the 1905 Amendment Act. This resulted in weekly rents ranging between 10s 6d and 12s 7d. All the houses had five rooms—a living room, a kitchen/dining room, and three bedrooms—as well as a bathroom. This allowed boys and girls to be given separate bedrooms from each other. Some houses were built of wood, some of concrete, and some of brick.
Twenty-five houses were built at Petone
Petone
Petone is a major suburb of the city of Lower Hutt in New Zealand. It is located at the southern end of the narrow triangular plain of the Hutt River, on the northern shore of Wellington Harbour...
in 1905. Only four applications were received to lease them. Workers could reach Wellington with a 20 minute walk followed by a 30-minute train ride, but the train cost another two shillings a week. This left a family no better off than continuing to rent in Wellington. The Government was forced to allow weekly tenancies and to raise the maximum income level to attract families to the houses. Other settlements such as the one in Belleknowes, Dunedin also had trouble finding renters. Houses built in central suburbs, such as the eight in Newtown
Newtown, New Zealand
The suburb of Newtown lies in the southern part of Wellington in New Zealand. The population at the last census was recorded as 8,409.The suburb lies east of Vogeltown, between Mount Cook and Berhampore...
and twelve in Sydenham, New Zealand
Sydenham, New Zealand
Sydenham is an inner suburb of Christchurch, New Zealand, located two kilometres south of the city centre, on and around the city’s main street, Colombo Street...
, attracted tenants much more readily.
After Seddon's death in 1906, the Government Advances to Workers Act allowed urban landowners to borrow up to £450 from the Government at low interest rates to build their own houses. This proved much more popular than the state housing system. A total of only 126 houses were built under the Workers' Dwellings Act by 1910. A replacement Workers' Dwelling Act in that year allowed landless urban workers to build a house on a deposit of just £10. While it still allowed for workers to rent or lease their homes from the Government, applicants who were willing to buy were favoured. The state houses were sold by the Reform Government
Reform Government of New Zealand
The Reform Government of New Zealand was the government of New Zealand from 1912 to 1928. It is perhaps best remembered for its anti-trade union stance in the Waihi miners' strike of 1912 and a dockworkers' strike the following year...
from 1912 onwards.
The First Labour Government
At the time it was elected in 1935, the First Labour GovernmentFirst Labour Government of New Zealand
The First Labour Government of New Zealand was the government of New Zealand from 1935 to 1949. It set the tone of New Zealand's economic and welfare policies until the 1980s, establishing a welfare state, a system of Keynesian economic management, and high levels of state intervention...
had no plans to introduce state housing. It nationalised the Mortgage Corporation set up in 1935 by the Coalition Government
Liberal-Reform coalition Government of New Zealand
The Liberal-Reform coalition government of New Zealand was the government of New Zealand from 1931 to 1935. It was a coalition between two of the three major parties of the time, the Liberals and Reform, formed to deal with the Great Depression which began in 1929...
to provide low interest housing loans.
Following a campaign against slums by the newspaper New Zealand Truth
New Zealand Truth
The New Zealand Truth is a tabloid newspaper published weekly in New Zealand. It started as the Auckland Truth in 1887.Described as "scandal mongering" and "scurrilious", it has employed well-known New Zealand authors, e.g. Robin Hyde in 1928....
, and the realisation that lending for mortgages was not effective to provide housing to replace them, the Finance Minister Walter Nash
Walter Nash
Sir Walter Nash, GCMG, CH served as the 27th Prime Minister of New Zealand in the Second Labour Government from 1957 to 1960, and was also highly influential in his role as Minister of Finance...
announced in the 1936 Budget that 5000 state houses would be built. The houses would be provided by private enterprise, with a Department of Housing Construction set up to oversee the building and the State Advances Corporation to manage the houses. The government intended not only to provide housing, but to stimulate jobs and manufacturing with the construction of the houses, which were to be built from New Zealand materials as far as possible.
The houses were built in the suburbs, not in the inner cities where the slums were. This was in part because the cost of building in the inner cities was higher, and in part because the government believed that children were better raised in suburban sections rather than on the streets. The urban poor also were largely unable to afford the rents for the new state houses. The government favoured married couples with at least one child as tenants to encourage an increase in the birth rate. Māori were excluded, in part because they could not afford the rentals, but also because the government believed the races should be kept apart.
Almost all of the state houses built by the Labour Government were detached, with some land on which vegetables could be grown and perhaps a few animals kept. A few were semi-detached, with two or four houses sharing a section. Only about 1.5% of the 30,000 houses constructed by 31 March 1949 were in blocks of flats, all of them in Auckland or the greater Wellington area. The first to be built were the low rise family flats flats in Berhampore
Berhampore
Berhampore may refer to one of several places:*Baharampur, in West Bengal, India, formerly known as Berhampore *Berhampore, New Zealand, a suburb of WellingtonSee also:*Brahmapur, a City in Orissa, India...
and the largest block was the 10 story Dixon Street Flats
Dixon Street Flats
Dixon Street Flats is a historic building in Wellington, New Zealand.The Dixon Street Flats in central Wellington were completed in 1944 as part of the first Labour Government's state housing programme. They are considered to be the archetype of Modernist apartment blocks in New Zealand...
in central Wellington
Wellington
Wellington is the capital city and third most populous urban area of New Zealand, although it is likely to have surpassed Christchurch due to the exodus following the Canterbury Earthquake. It is at the southwestern tip of the North Island, between Cook Strait and the Rimutaka Range...
containing 115 one bedroomed flats for couples and single people.
The first of the new state houses was completed at 12 Fife Lane
12 Fife Lane
12 Fife Lane, Miramar, Wellington was the first state house under the First Labour Government of New Zealand and was completed in 1937...
in Miramar
Miramar, New Zealand
Miramar is a suburb of Wellington, New Zealand, south-east of the city centre. It is on the Miramar Peninsula, directly east of the isthmus of Rongotai, the site of Wellington International Airport.-History:...
, Wellington
Wellington
Wellington is the capital city and third most populous urban area of New Zealand, although it is likely to have surpassed Christchurch due to the exodus following the Canterbury Earthquake. It is at the southwestern tip of the North Island, between Cook Strait and the Rimutaka Range...
, in 1937. The Prime Minister Michael Joseph Savage
Michael Joseph Savage
Michael Joseph Savage was the first Labour Prime Minister of New Zealand.- Early life :Born in Tatong, Victoria, Australia, Savage first became involved in politics while working in that state. He emigrated to New Zealand in 1907. There he worked in a variety of jobs, as a miner, flax-cutter and...
and several cabinet ministers carried furniture into the house and handed the keys to the tenants. For the opening of the first state house in each major city, a group of cabinet ministers repeated this ceremony. The tenants paid about one-third of their weekly income as rent for 12 Fife Lane.
The state houses were constructed using over 400 designs, so that no two houses in a given area were identical. There was a common theme to their design, with the public zones of living room, kitchen and dining area on one side of the house, with the living room to the north to catch the afternoon sun and the kitchen arranged for the morning sun, and the private zones of bedrooms, bathroom and laundy on the other side separated by a central hallway. Although the original plans included space for a garage, this was not included in the houses that were built, but a tool shed was provided to encourage tenants to grow a vegetable garden. The houses had wooden frames and timber or brick cladding.
The waiting list for state houses was 10,000 in February 1939. House building could not keep up with the demand, and almost stopped in 1942 as resources were reallocated to meet the needs of the war effort. Although construction resumed in 1944, by the time the war ended in August 1945 the waiting list had grown to 30,000. The government set up transit camps to provide interim accommodation for families waiting for state houses. Priority went to returned soldiers.
In 1944, the Department of Native Affairs produced a report on the poor housing conditions of Māori in the Auckland suburb of Panmure
Panmure, New Zealand
Panmure is a south-eastern suburb of Auckland City, in the North Island of New Zealand. It is located 11 kilometres southeast of the city centre, close to the western banks of the Tamaki River and the northern shore of the Panmure Basin...
. This and similar reports caused a change of policy; the government would now build state houses for Māori, to be jointly managed by the State Advances Corporation and the Department of Maori Affairs, which had been renamed in the interim. The new policy was to intersperse Māori and Pakeha households, so that Māori could "adjust themselves ... to the pakeha way of living". A rare exception to the interspersal policy was in Waiwhetu
Waiwhetu
Waiwhetū is a suburb of Lower Hutt, Wellington situated at the bottom of the North Island of New Zealand.Waiwhetū is largely built on land that set aside as a native reserve for the Te Āti Awa tribe in the 1840s. In the 1930s the land was compulsorily acquired by the government, with new homes...
in Lower Hutt
Lower Hutt
Lower Hutt is a city in the Wellington region of New Zealand. Its council has adopted the name Hutt City Council, but neither the New Zealand Geographic Board nor the Local Government Act recognise the name Hutt City. This alternative name can lead to confusion, as there are two cities in the...
, where state houses were built around a central marae
Marae
A marae malae , malae , is a communal or sacred place which serves religious and social purposes in Polynesian societies...
.
Although the National Party
New Zealand National Party
The New Zealand National Party is the largest party in the New Zealand House of Representatives and in November 2008 formed a minority government with support from three minor parties.-Policies:...
had opposed state housing in the 1938 election campaign
New Zealand general election, 1938
The 1938 New Zealand general election was a nationwide vote to determine the shape of the New Zealand Parliament's 26th term. It resulted in the governing Labour Party being re-elected, although the newly-founded National Party gained a certain amount of ground.-Background:The Labour Party had won...
, suggesting that it was a step towards the nationalisation of private property, in 1949
New Zealand general election, 1949
The 1949 New Zealand general election was a nationwide vote to determine the shape of the New Zealand Parliament's 29th term. It saw the governing Labour Party defeated by the opposition National Party...
it promised to continue building state houses but also to allow tenants to buy them. Most people wanted to own their own homes, and this policy helped National win the election.
1950-1990
In 1950, the waiting list for state houses was 45,000, and a total of 30,000 houses had been built. The National GovernmentFirst National Government of New Zealand
The First National Government of New Zealand was the government of New Zealand from 1949 to 1957. It was a conservative government best remembered for its role in the 1951 waterfront dispute. It also began the repositioning of New Zealand in the cold war environment...
increased rents for new tenants to make state housing less desirable compared with private renting, and an income limit of £520 per annum was set to ensure that only those on fairly modest incomes could rent a state house. A points system was introduced to decide which applicants for houses had the greatest need. This system was refined in 1973 and continued until 1992. The Government also introduced the sale of state houses to their occupants in August 1950. They offered 40-year mortgages on a 5% deposit at 4% interest, or 3% if the tenant agreed to continuously own and occupy the property. Many tenants were content to continue to rent with their guaranteed tenancies. By 1957, about 30% of the available houses had sold, which was considerably less than the government hoped.
The Labour Government
Second Labour Government of New Zealand
The Second Labour Government of New Zealand was the government of New Zealand from 1957 to 1960. It was most notable for raising taxes on alcohol, cigarettes and petrol, a move which was probably responsible for the government lasting for only one term....
elected in 1957 stopped promotion of state house sales, but the subsequent National Government
Second National Government of New Zealand
The Second National Government of New Zealand was the government of New Zealand from 1960 to 1972. It was a conservative government which sought mainly to preserve the economic prosperity and general stability of the early 1960s...
of 1960 restored it.
The policy of interspersing Māori and pakeha tenants ceased in the 1970s. Māori became concentrated in the larger state housing suburbs.
In 1974, under the Third Labour Government
Third Labour Government of New Zealand
The Third Labour Government of New Zealand was the government of New Zealand from 1972 to 1975. During its time in office, it carried out a wide range of reforms in areas such as overseas trade, farming, public works, energy generation, local government, health, the arts, sport and recreation,...
, the State Advances Corporation, responsible for administration, and the Housing Division of the Ministry of Works, responsible for construction of state houses, merged to form the Housing Corporation of New Zealand.
State house rental rates were fixed by the "fair rent" provisions of the 1955 Tenancy Act to reflect the capital cost of the house and the outgoings on it. While rents increased over the years, the rental was rebated according to the family's income and size. In 1974, the rents were fixed at the lower of the "fair rent" value or one-sixth of the household income. By the mid 1980s, the "fair rent" was about half the rental for an equivalent private property. The Third National Government
Third National Government of New Zealand
The Third National Government of New Zealand was the government of New Zealand from 1975 to 1984. It was an economically and socially conservative government, which aimed to preserve the Keynesian economic system established by the First Labour government while also being socially conservative...
of Robert Muldoon
Robert Muldoon
Sir Robert David "Rob" Muldoon, GCMG, CH served as the 31st Prime Minister of New Zealand from 1975 to 1984, as leader of the governing National Party. Muldoon had been a prominent member of the National party and MP for the Tamaki electorate for some years prior to becoming leader of the party...
set a time limit for new tenants. After six years was up, they had a year to agree to buy the house or move out. The following Labour Government abandoned this system, but set rentals to a quarter of the household income.
The Papakainga scheme was introduced by the Fourth Labour Government
Fourth Labour Government of New Zealand
The Fourth Labour Government of New Zealand was the government of New Zealand from 26 July 1984 to 2 November 1990. It enacted major social and economic reforms, including reformation of the tax system. The economic reforms were known as Rogernomics after Finance Minister Roger Douglas...
in the late 1980s to assist rural Māori to build their own houses on their own iwi
Iwi
In New Zealand society, iwi form the largest everyday social units in Māori culture. The word iwi means "'peoples' or 'nations'. In "the work of European writers which treat iwi and hapū as parts of a hierarchical structure", it has been used to mean "tribe" , or confederation of tribes,...
-owned land.
Market rentals
A peak of 70,000 state rental houses was reached in the early 1990s.In 1991 the fourth National government
Fourth National Government of New Zealand
The Fourth National Government of New Zealand was the government of New Zealand from 2 November 1990 to 27 November 1999. Following in the footsteps of the previous Labour government, the fourth National government embarked on an extensive programme of spending cuts...
raised state house rentals to "market levels" amid much controversy. The Housing Corporation was now expected to make a profit. At the same time, welfare payments were reduced. For those who could not afford the rent, the Department of Social Welfare would pay an accommodation supplement of 65 percent of the difference between the new rent and one quarter of the household income. The intention was to encourage able-bodied people to look for jobs, to remove the advantage of living in a state house over living in private rental accommodation, and to force people living in houses larger than they needed to move to smaller ones.
For many state house tenants, the new policies reduced their standards of living. Foodbanks increased in number in state housing areas, and overcrowding became a problem as some families shared houses. Mounting opposition included a partial rent strike
Rent strike
A rent strike is a method of protest commonly employed against large landlords. In a rent strike, a group of tenants come together and agree to refuse to pay their rent en masse until a specific list of demands is met by the landlord...
, organised by the State Housing Action Coalition (SHAC), during which tenants refused to pay more than 25% of their income in rent. In response, in 1996 the government increased the accommodation supplement to 70 percent, and restored the idea of "social objectives" rather than profit for the Housing Corporation.
A Home Buy scheme was introduced from 1996–99, which allowed tenants to buy their state home with a five percent deposit, an 85 percent loan from the government, and a ten percent suspensory loan. 1800 houses were sold under this scheme, and 10,000 more sold in this period.. However protests continued, culminating in the high profile eviction of a SHAC rent striker during the 1999 election campaign.
Current situation
The Fifth Labour GovernmentFifth Labour Government of New Zealand
The Fifth Labour Government of New Zealand was the government of New Zealand between 10 December 1999 and 19 November 2008.-Overview:The fourth National government, in power since 1990, was widely unpopular by 1999, with much of the public antagonised by a series of free-market economic reforms,...
, elected in 1999, placed a moratorium on state house sales and re-established the income-related rents. In 2001, Housing New Zealand, the Housing Corporation, and part of the Ministry of Social Policy were combined into the Housing New Zealand Corporation, so that policy and administration for state housing are controlled by a single agency.
A program to modernise state houses was introduced after 1999. Existing houses are insulated, the layout is improved, and in many cases the kitchen and bathroom are replaced. A "Community Renewal" program, started in 2001, attempts to build supportive networks amongst residents of state housing areas, reduce crime and increase safety, and improve community services.
Rents are now limited to 25% of household income for tenants on low incomes.