National’s housing plan economically reckless

National’s plan to sell state houses and provide income-related rent subsidies to private landlords will drive up rents and house prices for everyone and is economically reckless, the Green Party said today.

“Shifting the responsibility for housing from the Government to the private sector looks like a cynical attempt to enrich landlords while palming off responsibility for housing the vulnerable,” Green Party housing spokesperson Kevin Hague said.

“National’s plan swaps our state homes for massive state subsidies to private landlords.

“The Government paid out $1.2 billion via the accommodation supplement in the year to June 2014, a policy that is already credited with driving up rents.

“The provision of state houses by the Government delivers a supply of affordable accommodation. A good supply of rentals at a reasonable rate helps contain rents for everyone, not just those in the state house.

“That function no longer applies when our stock of state houses are sold.

“Rents will be driven higher, and while families with rent subsidies may be assisted short-term, the Government will be on a treadmill to pay ever higher subsidies as house price-related rents increase.

“At that point, the Government will say the cost of providing income related subsides is too high and it will make cuts.

“More than half - 53 percent - of the 265,000 children in poverty live in private rental accommodation, much of it sub-standard, according to a 2012 Ministry of Social Development report.

“That position is going to get worse with National’s new policy.

“Bill English claims it is cheaper to provide subsidies than build state houses. But he ignores both the role that building state houses play in boosting the supply of affordable houses and the fact that the Government will own a valuable asset at the end.

“Rather than selling state houses, we should be increasing the stock  of modern, affordable houses,” Mr Hague said.

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