It was disappointing when Paula Bennett was moved from MSD to Housing. But below partially explains why. Housing reform is critical to the success of welfare reform. As critical as the availability of jobs.
The following information appears in an Aide Memoire: Meeting with Hon Bennett and Hon Heatley regarding financial support for Housing, 9 May, 2012
The relative generosity of HNZC housing can act as a disincentive for people to move into the private rental market – on average non-HNZC tenants receive around $100 less in housing subsidy than HNZC tenants. Around half of HNZC tenants have been in their house for more than 5 years.It's much cheaper to live in a state house. A good part of the waiting list is probably made up of private renters who want to save money. Of course people stay in them.
But the problem doesn't end with state houses.
Financial assistance for housing may reduce geographic mobility and ability to take advantage of job opportunities - equivalent state housing in the high demand areas like Auckland may not be available and private rents may be unaffordable. In addition, housing affordability outcomes for non-HNZC tenants are better in remote rural areas, whilst those living in fast growing areas and cities are worse off.
Non-HNZC tenants are those receiving accommodation supplement to rent in the private sector (or board). MSD used to annually release data on who receive AS but ceased when the Statistical Report stopped. Here's the 2012 breakdown:
Most AS recipients also receive a benefit.
Getting a job often involves facing extremely high EMTRS due to losing AS, and,
Affordable housing isn't where the jobs are.
While this reality remains many beneficiaries, particularly single parents, will continue to live in areas where there are few employment opportunities and their children grow up thinking living on a benefit is the norm. Exactly the mindset welfare reform seeks to break.