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Stealth privatisation of state housing in budget

Written By: - Date published: 7:43 am, May 15th, 2013 - 35 comments
Categories: housing - Tags:

There’s more than one way to fleece the public of our assets. While attention is rightly on the big sell-offs of the energy companies, there’s also privatisation in the form of public organisations selling or giving away parts of their operations (eg Orcon), and opening public funding to for-profit companies (eg. charter schools). More seems on the cards for our state housing as National offers to give over control to private organisations.

I’m deeply suspicious of public funding being extended to unaccountable NGOs in this manner. It makes cost-control and quality-assurance harder. It’s an invitation to corruption – a whole new layer of checks usually has to be invented within the public funders to keep an eye on the NGO providers. And there’s often little proof that outcomes are actually better. Whanau Ora is the classic example of how out-sourcing a government service to private, semi-amateur groups results costs a lot and delivers little, and is blighted by corruption.

And will there actually be any more affordable housing as a result of National’s changes? Or will state houses just become privatised? That’s the test – if National’s not increasing the number of families getting good quality affordable housing in a cost-effective manner, then they’ve achieved nothing.

35 comments on “Stealth privatisation of state housing in budget ”

  1. freedom 1

    Am I being overly cynical or will the Government say they have increased social housing by incorporating whatever housing numbers the NGO’s already have on their books ?

    • geoff 1.1

      They’ll totally do something like that and David Shearer will nod along in agreement with them like he has with National’s housing policy.
      Prediction: One of National’s strategy going into election will be presenting policy that looks like it’s in the social good so that DS won’t know how to argue against it.

  2. fambo 2

    This government wants to privatise everything. Once one understands this, everything starts to fall into place

    • johnm 2.1

      100% right!

      • fambo 2.1.1

        Here’s how it would work for your local park.

        1/ Government introduces legislation prohibiting councils from running parks because they are outside their core responsibilities

        2/ Councils have to give contracts to private companies to maintain parks and introduce a user pay system to cover the cost of maintaining the park because councils are prohibited from running the park at a loss (under the guise of saving rate payers money). Users of park have to pay for using it.

        3/ Councils eventually forced to sell half or all of the value of the park to private sector, most logically the company already involved in running the park.

        4/ Business(es) who own half or all of the park flog of a good proportion of it for real estate subdivision so they can make a profit and also argue the money raised will help them run the park.

        5/ Community left with small park or no park at all, or a small park they have to pay to use.

    • Olwyn 2.2

      The idea of privatising absolutely everything would not be so bad, and I say this as a socialist myself, IF it was underpinned by the notion of forming a functional society upon this basis. But it is not. It is underpinned by a Thatcherite mentality; an outlook that is more committed to ensuring that the other side never again gain traction than it is even to its own abiding success. In short, by class warfare. Landlording is better than manufacturing within this framework, because manufacturing might ultimately give a little power back to the enemy. Eventually of course, partly due to a lack of manufacturing, the state will eventually run out of money to prop up the landlords, but meh…at least for now, the enemy is subjugated, and something might come up….oil perhaps…

      • geoff 2.2.1

        The thing is that even Thatcher didn’t have the gall to go as far or as fast Roger Douglas did here. Like Geoff Bertram said, in regards to comparing how Britain privatised compared with NZ, Thatcher flogged off the assets but she at least regulated them so they couldn’t increase the book value which causes the price gouging. Here in NZ it was a complete fucking free-for all, hence why we are so screwed.

  3. tc 3

    Yes Eddie there appears to be no focus on the trough for the MP that is whanau ora.

    Watch the NACT flog everything in sight off over the next year, they will not gamble on a third term IMO they will go for broke.

    With muppets like smith, bridges, parata in place whilst the dark lords in the shape of Blinglish, Bovver boy Joyce, Royall and Findlayson go about the required spadework to make it occur.

  4. jcuknz 4

    Orcon a public organisation? Surely not.
    Though I much prefer that the government provides housing rather than councils and NGOs …I suppose councils are NGOs? The record of recent past govcernments of all kinds is pretty dismal IMO..

    • Lightly 4.1

      until recently, Orcon was owned by SOE Kordia, which sold it.

      • tc 4.1.1

        And it’s rapidly gone to the dogs of commercialism even more than it was already with a phillipines call centre fronted by friendly yet unhelpful folk who talk complete shite as they’ve no clue about the services being supported, all about the bottom line folks and a quick buck on the sale.

      • Doug 4.1.2

        Orcon began as a private company. Kordia purchased it and now sold it.

  5. pollywog 5

    Let the slumlord privateers have the shitty, cold and obsolete state houses.

    So the state can use the money to build stuff like this…


    Whole neighbourhoods of them!

    • ghostrider888 5.1

      Discussion on local initiatives; Nine to Noon,
      (although, my personal experience of NGO’s in the health sector? Not good, overall; the delivery of service producing more pseudo-professionals, ticket clipping and weak accountability).

    • ghostwhowalksnz 5.2

      Its the land on them that the private interests want.

      The houses would be moved off pronto and probably sold back to the government for a fat profit

      • pollywog 5.2.1

        No one said nothing about land 🙂

        • ghostrider888

          “Easy Money”, “Free Money”, “Money money money…” “here they go now singing monie monie…”

  6. infused 6

    Orcon was a dog. If you had any idea of the inner workings, you wouldn’t even mention it.

    • NickS 6.1

      It actually used to be pretty damn good, decent prices decent speeds and fast tech support that would work things out quickly. And if it was telecom’s fault (i.e. work on an exchange/streetbox) they’d usually know and tell you so.

      Then something went wrong and they turned into a cheaper telecom clone, likely due to the management wanting “profitsssss” irrespective of the fact the ISP market was rather competitive and users talk. Leading to a flight to better ISP’s, despite of penalty fees.

      • Rich 6.1.1

        It’s a dumb business model. There are two (urban/suburban) networks in this country, Telecom/Chorus and Vodafone (ex Telstra). Everyone else is just reselling Telecom/Chorus and trying to carve a margin out of lower volume – obviously customer service has to give.

        We’d be better off with an NZ Power model where a fair price and SLA gets set and the suppliers just deliver to that. Cheaper, better and more transparent service. Less marketing make-work jobs and corporate profiteering.

  7. karol 7

    Very good and important post, Eddie. I think community housing organisations can make a valuable contribution to housing provisions, but they shouldn’t be used to replace state housing. State housing is a necessary under-pinning of the whole array of housing available in the country.

    Community housing without a strong state house provision, will become dominated by, and sucked into, the “market” logic.

  8. Lionel 8

    we have a far right government who are trying to bulldoze through everything that it is dear to them
    before their time is up National,s distain for the electorate is obvious by the contempt in which they have shown towards the recommendations by the electoral commision which made the referendum a waste if time and money and because they rely on ACT and doofus Dunne they were bound to ignore it they,ve got to go

    • Colonial Viper 8.1

      Everything you said is correct, except they are not a “far right government”, they are a moderate right government.

    • Arfamo 8.2

      Dunne’s not a doofus. He is simply a professional minister available to whichever party for the right price every three years.

    • jcuknz 8.3

      If you want to see a ‘far right’ party look at the Republicans …. National are further left than the Democrats.
      I joined and liked Hyper in its early Dunedin days but now I have gone to another smallish outfit and shot of Orcon thank goodness.

  9. vto 9

    There in only one solution…

    Vote Them Out

  10. Doug 10

    Orcon began a a private company and has now returned to private hands.

    • lprent 10.1

      Let me correct that for you…

      Orcon began as a competent private company and has now returned been flogged off to incompetent private hands.

      The original Orcon was pretty fantastic for anyone interested in good service. Their service before since they started getting packaged for sales was pretty adequate. However for the last year or two it has been deteriorating rapidly and can now only be described at complete crap. Basically seems on a par with slingshot or ina different but similar frame, with the disaster that is Chorus.

      Looking for anyone else who is more competent as soon as the fibre becomes available at home. Probably Voyager…

  11. Stephen 11

    As Phil Twyford pointed out in a speech at the Region 5 conference on the weekend, this offloads maintenance and other responsibilities from the government. It’s pretty cynical cost-cutting.

  12. Draco T Bastard 12

    It’s an invitation to corruption…

    Which is, as far as I can make out, why National do these things. It allows more ticket clipping by the ownership class.

  13. Binders full of viper- women 13

    “I’m deeply suspicious of public funding being extended to unaccountable NGOs in this manner.”
    I’m not .. the very good Greens housing policy (incl progressive ownership) encourages social housing from the likes of iwi/councils/salvation army etc. They are all quite often more in tune with the community than housing corp.

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