TRC and Veiled Privatisation
Stock transfers: what does it all mean?
For the last five years, since the beginning of the redevelopment of Glen Innes, the government has been flailing around with what to do with state housing. The social housing reform program, where state housing is to be transferred from state to private ownership is now the plan.
The action points of the program currently are:
- 2,800 state houses in Tāmaki (Glen Innes, Panmure, Mt Wellington) to be transferred to Tāmaki Redevelopment Company;
- 1,124 in Tauranga and 348 in Invercargill in the process of being transferred;
- Interested social housing providers are invited to contact the government but the number of state houses to be transferred is still unknown or secret.
This program is modelled on Margaret Thatchers 1980s housing reforms which moved nearly all of the U.K.s council and government housing into housing associations (also known as housing estates). These estates are not-for-profits and have to be registered as social housing associations.
In Aotearoa, too, the Community Housing Providers that state housing is to be transferred to, have to be admitted to the social housing register.
So what’s the problem?
Well if we look at the U.K. housing estates, while these are not-for-profits, they are run as businesses. Money they have from rents goes to expansion and buying more residences, not to maintaining the housing stock they currently have or to providing services to their tenants. It also costs more to maintain houses when they are run by private institutions.
The government has been conflating social housing and state housing, renaming state housing as social housing in their legislation, websites, on media etc. This is problematic because it makes it very difficult for the general public to identify that there is a real change happening.
This is a real and dramatic shift. State housing has been an important part of the economy and of society since the 1950s. State housing stabilises house prices and rents in an area. Aotearoa has a history of state housing that reflects a society that saw the government’s role as one that was responsible for alleviating poverty. State housing also represents promises the state made to returning servicemen.
This process of transferring houses is, as Alan Johnson (Child Poverty Action Group, Salvation Army) pointed out in his 2014 paper, The New Politics of Social Housing, “privatisation by stealth”.
Why is a company taking over state houses?
In March 2015 the Salvation Army released a report that rejected the government’s offers of transferred state housing stock. The government was left embarrassed and scrambling to find social housing providers that would take state houses. A month later, in late April 2015, the government announced Tāmaki Redevelopment Company would be taking the 2,800 state houses in Tāmaki.
While this is the first transfer of the program, we can already look at the work Tāmaki Redevelopment Company has been doing. This company was set up as a company owned jointly by the government and Auckland Council. It is the bright and cheerful face for a process of gentrification.
Gentrification is where low-income community members are displaced by middle- or higher-income people. In Glen Innes this is a state-led process where houses and land have been sold to property developers who are then able to make massive profits. Because of this, house prices in Glen Innes have more than doubled since 2011 when the redevelopment started.
Tāmaki Redevelopment Company was created to make the Tāmaki area more attractive to wealthier residents. For this company to take over these tenancies is ominous.