2 Dec 2021

Wellington City Council social housing tenants may soon get help with rent

7:14 am on 2 December 2021

Wellington City Council is considering measures to alleviate financial stress for social housing tenants in hardship.

Wellington, New Zealand - city aerial view of marina and downtown skyscrapers.

Wellington City Council's social housing tenants may soon get help with their rents. Photo: 123RF

A report being considered today recommends expanding an existing temporary rent subsidy to all eligible tenants for 12 months.

The Affordable Rent Limit Subsidy allows a six-month reduction for tenants in financial hardship.

The report shows over 600 tenants meet the criteria but to date only 42 are receiving it.

The subsidy has been available for a decade, and during that time about 400 tenants have accessed it, some several times.

It has not been widely advertised due to there not being enough funding to go round.

The report recommends council looks at covering the costs for all eligible tenants to be subsidised for a 12-month period.

In October, Councillor Jill Day put forward a notice of motion to seek the solutions in today's report.

She said the recommendations buy time.

"Our notice of motion is really addressing the immediate issue and gives tenants breathing space while the council and government investigate options to solve that bigger financial sustainability challenge," she said.

Wellington City Councillor Jill Day

Councillor Jill Day (centre) said the short term measures help tenants while the council and government investigate options to sole the bigger financial challenge. Photo: RNZ / Samuel Rillstone

The subsidy is estimated to cost $822,000 annually.

It could be funded either by adding it to the existing council housing deficit, or through a 0.2 percent rates increase for the next financial year.

A rent freeze for all tenants next year will also be considered, which would equate to $1.4 million in lost revenue, or a 0.4 percent rates increase.

The report recommends the subsidy be expanded for all eligible tenants, but does not recommend ratepayers cover the cost or that the rent freeze be considered.

Some councillors want the short-term fixes to be rates-funded and this morning will put forward an amendment to agree, in principle, for both options to go ahead and be rate-funded.

Councillors Iona Pannett, Laurie Foon, Diane Calvert and Tamatha Paul also want a public endorsement of the tenant-led campaign for the government's Income Related Rent Subsidy, 'IRRL 4 All'

Councillor Paul said council needed to send a clear signal on what it wants to do for its housing issue.

"The affordable rent limit subsidy is a really good idea, the rent freeze is essential - but we believe that should be rates funded because if we borrow from the existing deficit we will plunge City Housing further into disarray," she said.

Tenants are happy to hear their rents may be more affordable soon.

Debbie Porter's rent takes up 60 percent of her income and the temporary subsidy would help her immensely.

"That means I'll have more money to do things, like go to the doctors if I need to, or saving up for that new mobility scooter I want... I can't look at stuff like that right now" she said.

Porter is one of the campaigners for IRRS 4 All, the tenant-led group lobbying the government to extend its social housing arm to council housing so she, and many others, can access the income related rent subsidy.

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Wellington mayor Andy Foster. Photo: RNZ / Samuel Rillstone

Mayor Andy Foster said the council's focus was still a the long-term fix for its housing problem.

"[The subsidy] is helpful in reducing the cost to some of our tenants, but it obviously exacerbates the problem for council's housing business unit, so it's a temporary measure," he said.

The subsidy would likely impact some tenants' accommodation supplements or temporary support provided by the Ministry of Social Development.

The council report said doing so "essentially results in Council both losing income and fulfilling the role of central government."

Foster said council officers were in almost daily contact with officials from the Ministry of Housing and Urban Development.

The government will provide an update on Wellington City Council's social housing issue before Christmas.