Local government has historically been New Zealand’s second biggest provider of social housing. Councils in New Zealand have been providing social housing - that is, housing at less than market rents - for almost a century, and from the 1940s to 1991 were involved in a highly successful housing partnership with central government. Yet despite this track record, councils have largely been ignored as a viable option for addressing the current social housing crisis. Councils are unable to become community housing providers (CHPs) (and therefore offer tenants income related rent subsidies (IRRs)) even though eligibility to receive the subsidy exists for both for-profit and not-for-profit organisations, and even international firms. Given the urgency of New Zealand’s social housing crisis it is difficult to understand why local government is not being enabled to play a bigger role.

This paper has been prepared in response to a remit put forward at the 2019 LGNZ AGM, and in light of the current Review into the Future for Local Government. It examines the reasons why local authorities have been excluded from being supported to be social housing providers, and why they have found it so hard to argue their case. In doing so, the paper considers the historical context, particularly the withdrawal of central government support for council social housing in 1991, and the decision in 2013 to exclude councils from applying to become CHPs. Of particular interest are the reasons why this exclusion continues, given that the current government campaigned to remove it while in opposition.