For low-income New Zealanders, it’s a homeowner’s budget

The extent to which Labor has deserted renters and low-income families in this budget is best illustrated in housing.

When Labor came to power in 2017, there were 5,000 people on the State House waiting list. That number had soared to 25,500 by the end of last year and was accurately described as a housing ‘disaster’ by the Salvation Army.

So what does the 2022 budget deliver? Here is the RNZ Housing Budget Summary:

Lodging

• $221 million for the Affordable Housing Fund
• $1 billion to support public and transitional housing
• $355 million to overhaul the emergency housing system
• $75 million for homelessness action plan

The $221 million Affordable Housing Fund is intended to help middle-class children get their first home. The other three amounts are for public housing and social housing providers, and taken together ($1.43 billion) would only build 5,000 homes – in practice much less.

How does this solve the 25,500 – and growing – State House waiting list? It is not, and Labor is happy to keep it that way.

Essentially, by limiting the number of state houses, the government is increasing the incomes of middle-class New Zealanders who have rental properties. Keeping housing supply tight for low-income families forces these families to stay in private sector rentals and pay impossible rents. The government then subsidizes these incredibly high rents through the housing supplement rather than building state houses itself.

For low-income people, this is a homeowner’s budget.