How ‘affordable’ is KiwiBuild
It was one of the all-time great photo opportunities. On September 18, 1937, then Prime Minister Michael Joseph Savage helped Wellington couple David and Mary McGregor into the first Labour Government state house on a small street in Miramar. A crowd gathered as the
65-year-old Savage carried a heavy dining table through the front door, and apparently dropped it soon after.
History records that David McGregor was a tram driver for the Wellington City Council. Politicians did not talk about ‘‘optics’’ back then unless they were being fitted for glasses, but the working-class McGregors seemed to have been the ideal face of the state housing scheme.
There was an inevitable contrast with last weekend’s KiwiBuild photo opportunity in Papakura, where the Government welcomed the lucky new owners into their four-bedroom home as Dave Dobbyn sang Welcome Home and Prime Minister Jacinda Ardern gave them a tree as a housewarming present.
The difference is instructive. KiwiBuild is not a state-housing scheme. Rather than giving a leg up to the working poor or sheltering the homeless, KiwiBuild could arguably be called middle-class welfare. The Papakura couple are a graduate doctor and an online marketing manager.
Labour promoted the KiwiBuild policy in 2017 by pointing out that the ‘‘Kiwi Dream of home ownership is slipping away’’, with only a quarter of adults under 40 owning their own home, compared with half in 1991. Labour promised to deliver
100,000 affordable houses over 10 years for firsthome buyers, and expected that increasing supply could stabilise prices. One year on, 18 homes have been built and another 447 are under construction. The first deadline is to have 1000 homes built by July 1, 2019.
The Government clearly needs to start thinking big. But whether demand can be met is only one of KiwiBuild’s problems. There is also the question of what constitutes an ‘‘affordable’’ home. As economist Shamubeel Eaqub explained, KiwiBuild is not aimed at strugglers but at first-home buyers, who have not been a priority for developers.
The average household income in New Zealand at June 2017 was $100,103, and the average personal income was $49,475. But KiwiBuild is open to twoincome households earning as much as $180,000. It is clear the working poor need not apply. A KiwiBuild couple with no children would have to repay at least $1616 per fortnight, according to bank calculations.
It is not surprising activist group Auckland Action Against Poverty protested at the weekend’s KiwiBuild media event in Papakura. That group and other critics would surely welcome a genuinely affordable scheme.
But while it may be fair to criticise KiwiBuild as middle-class welfare, attacks on the credibility and background of the lucky couple who legitimately won a ballot were uncalled for. Encouraged by Right-wing trolls, National MP Judith Collins shared a screenshot from the couple’s social media accounts and questioned whether a couple who can afford to travel should be assisted by the state. But again, the couple have done nothing wrong.
After the deeply unpleasant Jami-Lee Ross scandal, National leader Simon Bridges promised a review of his party’s culture. The sneaky and nasty politics this week from one of his most prominent MPs shows such a review is more timely than ever.
‘‘KiwiBuild is not a state-housing scheme. Rather than giving a leg up to the working poor or sheltering the homeless, KiwiBuild could arguably be called middle-class welfare.’’