Election 2017 – Māori Housing Policy Round-up

Housing is a hot-button issue this election year, with various parties contributing their own targeted solutions.  Do the policies stack up, and what do they mean for Māori? Te Matapihi cuts through the spin.

Most election year party policies consist of an ideological centre wrapped in a middle-ground solution – avoiding the sort of detail that could see their claims called into account. Some policies are evidence-based, some are rhetoric, most are a mixture of both and it can be difficult to separate the two. Not all parties have Māori-specific housing policy, and where they do levels of detail vary, making comparison difficult. A ‘good idea’ may be socially beneficial but unworkable without major structural change, or a party may be unable or ill-equipped to deliver, even if elected into government. So, how to make sense of a complex and pressing issue this election year, particularly for Māori?

A basic overview of market theory (bear with me) is useful to understand our current housing issues – and potential solutions. Housing markets are a balancing act between supply and demand. The supply side includes building industry responsiveness, availability of land, and consenting requirements. The demand side includes net immigration, low interest rates and easier credit standards. The markets to build, own and rent houses are interrelated, but slightly different. This largely relates to financial benefit and risk, and who is exposed to capital gains, or losses. In New Zealand, demand has outstripped supply over the past few decades or so, resulting in increased house prices relative to rents, incomes and construction costs.

Many politicians, economists and commentators have deemed our current housing situation – including issues of housing availability, affordability, quality and security – a demonstration of market failure. Certainly, few would argue that our market is operating as effectively or efficiently as it should be. Depending on political ideology, however, there are differing views as to the degree to which government should intervene in markets.

An open market is free to operate in accordance with economic forces, whereas a closed market is regulated to restrict free market activity or behaviours (though in reality few markets exist without some degree of government intervention). Just how much the government of the day intervenes is what determines whether a market is ‘open’ (unrestricted) or ‘closed’ (restricted). There is no hard and fast distinction between open or closed markets – these definitions operate on a sort of sliding scale.

Government has the ability to intervene through a number of measures, such as taxation, regulation, price controls, subsidies, better information, and direct provision. The reasons for intervention vary but are generally in response to macro-economic factors (the behaviour of the economy as a whole, including ‘natural’ economic events such as the global financial crisis) or socio-economic factors (such as rising economic inequality, or a dip in trade). These interventions, along with direct provision (arguably also a form of market intervention) form the basis of all government policy.

Public assets, which we as a society agree are for the good of everyone, sit outside of the market and are managed by the government on behalf of everybody. In New Zealand, this includes state housing administered by Housing New Zealand Corporation (HNZC), and housing owned and managed by local authorities (Council flats – generally for older people). The social housing reforms initiated by the New Zealand government in 2011 began the process of building a closed market for social housing. The Community Housing Regulatory Authority (CHRA) was established, and dedicated revenue sources for registered Community Housing Providers through the Income Related Rent Subsidy (IRRS). A stock transfer programme was also initiated. It's important to note that although New Zealand has adopted a closed market model, non-market non-government provision of social housing is also possible.

So – why should Māori be specifically considered in the development of housing policy? First, Māori constitute a minority population in Aotearoa New Zealand (with poorer socio-economic outcomes overall), and have generally been ill-served by open markets. Second, Māori housing is a Treaty issue. Te Tiriti o Waitangi constitutionally enshrines equality of outcome and opportunity between Māori and non-Māori. Clearly, the expectations set out in our Treaty agreement are not being met, with Māori worse off than non-Māori overall, across practically every measure. Additionally, the Treaty guarantees rights to self-determination, and iwi, hapū and pan-tribal organisations are all demonstrating their interest and growing capacity to deliver.

So how will whoever forms the next government enable and support – rather than thwart – the rights and aspirations of Māori in relation to housing? And in the lead up to this election, how do the various political parties’ policies demonstrate their understanding of, and commitment to, improving Māori housing outcomes? Next week we’ll be taking a closer look at Labour’s Māori housing policy – stay tuned for the next instalment, out Friday 11 August.

This is the first article in Te Matapihi’s Māori housing election year series. Each of the subsequent articles will tackle a political party’s housing policies, focusing on availability, affordability, quality and security, with emphasis on what these all mean for Māori. The series will conclude with a ‘scorecard’ comparison of what works, what doesn’t, and what’s likely to make a difference for Māori.