McCully Announces Stronger Social Mandate for HNZ

"A stronger social mandate for Housing New Zealand is the key theme of the company's 1997-98 Statement of Corporate Intent", released by Housing Minister Murray McCully today. He said the Statement of Corporate Intent was part of a package of housing measures he would release over the next few days.

In releasing the Statement of Corporate Intent the Minister highlighted initiatives which would be taken to implement Coalition Government policy. These included:

a stronger social mandate and process for social accountability;
new rent setting processes;
a dramatic re-configuration of the company's stock; and
maximum acceptable vacancy rates for each region.
The Statement of Corporate Intent has been the subject of negotiation with the Housing New Zealand Board "over some months," the Minister said, in order to set the scene for the implementation of Coalition Agreement initiatives.

He said NZ First Housing Spokesperson, Ron Mark, has been closely involved in developing the programme.

Mr McCully said the Coalition Government remained committed to the principles of delivering affordability assistance through the Accommodation Supplement, "to ensure fairness and equity."

"It is important to remember that the majority of the 290,000 New Zealanders who receive the Accommodation Supplement, do not live in Housing New Zealand properties."

"However, we believe that the changes announced today will better enable Housing New Zealand to deliver on the social goals which have caused the Government to remain an owner of rental properties."

He said the Coalition Agreement set a new foundation for public housing policy, requiring that the Government:

accept in principle the merger of the Housing Corporation, Community Housing Limited and Housing New Zealand under a single structure;
replace the profit focus of Housing New Zealand with a new brief to meet the Crown's social objectives in a businesslike manner;
review the current Right to Buy scheme;
recognise special pressure in Auckland by significantly increasing Housing New Zealand stock there; and
initiate special arrangements to manage high priority cases.
The Government sets its social policy objectives each year for Housing New Zealand in a Social Objectives Letter to the Crown agency, and which are subsequently formalised in a new Statement of Corporate Intent. Mr McCully said performance improvements could be achieved by refocussing and realigning Housing New Zealand's processes, incentives and attitudes.

The past few months have enabled shareholding Ministers and directors to work through programmes which will improve Housing New Zealand's social performance.

"We have agreed in principle that high priority cases must be identified and managed more effectively than in the past. I expect new procedures to be in place early in 1998."

"The Statement of Corporate Intent also stipulates for the first time maximum vacancy rates for each region. The shareholders letter to the company makes it clear that vacancy rates in some locations have been unacceptably high. The company's performance against maximum vacancy rates will be closely monitored."

"I am announcing separately that new rent setting processes have been put in place. These, in conjunction with current market trends, will ensure that many tenants receive no rent increase, or a decrease, in their next review."

"We have also agreed on a dramatic programme to re-configure the company's stock so that it better meets the needs of the late 1990's."

"I will separately announce a programme of new acquisitions in Auckland for the year ahead."

"However, it is important to note that there will be an equal emphasis on divesting those houses for which there is no significant social requirement for Government ownership."

"The Government remains committed to the Right to Buy programme. Internal changes being made as a result of the in-principle merger of Housing New Zealand and the Housing Corporation of New Zealand, will make Right to Buy purchases easier to achieve, with a greater range of Housing Corporation of New Zealand products to facilitate purchases."

"I will also announce separately a pilot programme to improve individual home ownership in some areas of high Housing New Zealand dominance, through a series of workshops and courses."

"After some months of work on the new Statement of Corporate Intent and new initiatives with Housing New Zealand directors, I am satisfied that today's announcement will preserve the gains we have made in terms of fairness, whilst more effectively delivering on the Government's social goals for housing through Housing New Zealand."