When cost savings cost us all

What the government calls “right-sizing” on its provision of social housing will cost the country in social harm, writes Rebekah Graham.

 

The Minister of Housing, Chris Bishop, has halted hundreds of Kāinga Ora housing developments across Aotearoa New Zealand. Public housing projects already in planning and ready to go have been paused, reassessed, or cancelled. Land previously earmarked for state homes will be sold.

While Bishop frames this as “restoring financial discipline”, the reality is that dismantling public housing infrastructure is short-sighted and socially damaging. It also occurs within an environment where homelessness is rising faster than our population is growing.

As Bernard Hickey has reported, homelessness is up in our biggest cities by around 25 percent to 225 percent after motel clearances.

The evidence is laid out in the Housing and Urban Development Ministry’s (HUD) Homelessness Insights report for June, which was released last week. It shows that rough sleeping has risen between 25 and 225 percent — based on reports from local outreach services, councils, Corrections and Health NZ — since the government changed its policies to shut down emergency housing in motels and toughen the criteria for putting people into social housing.

HUD collated a variety of data more detailed and recent than from the 2023 Census, which found 4,965 people were sleeping rough or in cars, up from 3,624 in 2018, including that:

• Auckland Council said outreach services found 809 people were sleeping rough at the end of May, up 89 percent from September 2024.
• Tauranga Council said its call centre recorded reports of 619 homeless people in 2024, up 46 percent from 423 in 2023.
• PARS Taranaki estimated the number of rough sleepers in Taranaki more than tripled to 35 in December 2024 from 10 in June 2024.
• Porirua Council said its quarterly audits found the number of rough sleepers almost trebled to 18 by March 2025 from 7 in March 2024.
• Whangārei District Council said public reports of homelessness rose 56 percent to 1,066 in 2024 from 680 in 2023, and it forecast 1,200 for 2025.
• Wellington’s Downtown Community Ministry reported 328 homeless people in the March quarter of this year, up 5 percent from a year ago, while rough sleepers rose 24 percent to 141 in that period.
• Christchurch City Mission reported its outreach workers found 270 rough sleepers in the six months to March 2025, up 73 percent from 156 in the previous six months.
• Corrections reported that at least 350 people who had just left prison had no fixed abode.
• Hospital emergency departments reported 64 homeless people had presented at EDs in the month of November 2024, up 88 percent from 34 in November 2023.
• Health NZ reported homeless people had been forced to stay in hospital facilities for 954 total nights in the month of December 2024, up 42 percent from 669 in December 2023.

Cancelled social housing builds

Altogether, 371 developments (involving 1,576 planned homes) have been cancelled by the Minister for Housing.

Entire communities are affected, from Ruakākā in Northland to Port Chalmers in Otago. Auckland, Hamilton, Rotorua, and Dunedin, have all seen major housing developments placed on hold. Flagship sustainable housing projects, such as Ngā Kāinga Anamata in Glendowie, have been abandoned.

This is not a “turnaround plan”. It is a large-scale rollback of public housing investment — investment that is much needed and would go some way to addressing homelessness statistics.

A quick list of the affected projects, which will impact more than 1500 new house builds:

• Northland — 50-home development in Ruakākā halted, Kerikeri development shelved.
• Auckland — 185-home project in Onehunga reduced, flagship net-zero homes scrapped.
• Hamilton — 107 homes across two sites (including Endeavour Ave) on hold.
• Dunedin — 10 developments affected, including the Carroll Street redevelopment.
• Palmerston North, Wellington, Napier — multiple sites in limbo.
• Nationwide — 371 developments reassessed, affecting 1,576 homes.

You can see a full project list here.

Cancelling already consented projects is fiscally irresponsible

Cancelling housing developments already underway is a waste of so much work — planning, design, site consultation, and infrastructure development.

Halting these projects incurs sunk costs that will not be recovered. There are limited alternative sites available. Emergency and transitional accommodation are both more expensive to operate and less effective in meeting the needs of families.

The Minister for Housing describes cancelling these projects as “right-sizing” Kāinga Ora. Despite his careful spin, the reality is that this is a deliberate de-prioritisation of public housing. In the middle of a housing crisis and defunded emergency and transitional services, no less.

The impact on disabled people and families

More than a quarter of New Zealand households now rely on some form of housing support, from state homes to rent subsidies. One in four families cannot afford private market rents without government help.

The private market has failed to meet the accessibility needs of disabled people and their families. There is a major shortage of privately-owned homes in Aotearoa New Zealand that meet basic accessibility standards, such as step-free entrances, wider doorways, and accessible bathrooms, with even fewer that are fully accessible.

This has a flow-on impact for disabled people and their families, many of whom face systemic exclusion from the private housing market. Typically, in Aotearoa New Zealand, it is Kāinga Ora and associated community housing providers who incorporate universal design principles into new builds. Kāinga Ora had a 15 percent goal for new builds to be fully accessible. Social housing projects being cancelled disproportionately harms disabled people and their families, including those with long-term health conditions, who are more likely to be living in inadequate, damp, unhealthy, and inaccessible homes.

A lack of accessible housing forces many disabled people into unsafe, overcrowded, or institution-like settings. This is not by choice, but is a necessity, and further restricts autonomy, social participation, and employment. Accessible housing is a fundamental requirement for disabled people to live with dignity and independence in their communities.

A quick reminder of some existing quick stats around disability and housing:

• One in six New Zealanders has a disability.
• Over 50 percent of disabled people live in rental accommodation, and at least half of those are living in poor-quality rental homes.
• Less than 2 percent of all New Zealand homes are estimated to meet minimum accessibility standards.
• Disabled Māori and Pasifika are significantly more likely to experience overcrowding, dampness, and unaffordable rents.

Even though there is a high need for accessible social housing, the supply of purpose-built accessible homes remains critically low and is not projected to meet current needs anytime soon.

In praise of social housing

There is a robust body of New Zealand-based research that provides strong evidence of social housing being a high-return social investment with significant flow-on benefits for the whole population.

This is what it shows:

1. Stable social housing reduces crime.

Longitudinal research by the University of Otago found that youth offending dropped by over 10 percent among young people who moved into permanent social housing.

Three years after moving into public housing, alleged offences and court charges among young people reduced significantly — by 11.7 percent and 10.9 percent more than the general youth population. Rates of alleged offending and court charges also decreased among those receiving an accommodation supplement — 13 percent and 8.6 percent more than the general youth population.

The study’s authors emphasise that secure housing supports school attendance, community bonds, and parental engagement, which are all key factors in lowering justice system interactions.

Lead author Dr Chang Yu says stable housing plays a crucial role in promoting social cohesion and reducing risk factors associated with youth offending.

“The security provided by guaranteed housing enables young people to more consistently attend school and establish strong community bonds, resulting in them being more engaged at school and better supported socially.

“Studies have also shown that having a stable home may lead to parents having more time to spend with their children, resulting in stronger parent–child bonds, and better emotional and physical well-being for the child.”

Stable housing provides a foundation for employment, whānau (re)connection, and for accessing support services, all of which are core elements that support positive, non-criminal activities and engagement.

In addition, another study examined the outcomes of individuals released from prison. They found that those who were living in stable housing six months after release were 4.6 times less likely to be re-imprisoned than those with unstable housing (7 percent vs 34 percent).

The authors concluded:

“Our findings support addressing housing instability as an important factor in the cycle of reoffending and demonstrate an imperative to invest in comprehensive, long-term housing solutions for those leaving prison. Such housing solutions can be conducive to wider stability in life, the development of social capital and other factors associated with reduced recidivism and desistance from crime. Stable housing remains a fundamental pillar for sustainable and successful reintegration into society, and no person should leave prison with an unmet housing need.”

2. Decent housing saves money in health.

Comparative research tracking individuals who move from emergency housing into social housing shows significant improvements in their health and wellbeing.

Social housing residents benefit from improved environmental conditions (warm, dry, reduction in crowding), with flow-on positive impacts for mental and physical health.

An evaluation of the Healthy Homes Initiative revealed that every $1 spent on creating warm, dry homes delivered $5.07 in health savings.

Over a period of five years, living in warm, dry, stable housing resulted in lowered hospitalisations (a reduction of nearly 19 percent), fewer emergency admissions, and reduced school absenteeism by 5 percent. Living in a warm, dry, stable home resulted in 10,000 averted hospitalisations — a significant cost saving for health.

Another study tracking transitions from emergency housing to social housing found a decrease in annual hospitalisation rates and a decrease in the annual rates of mental health outpatient use after people entered social housing.

Poor housing conditions costs New Zealand taxpayers $141 million annually in avoidable healthcare costs and are linked to over 200 preventable deaths each year.

Moving families into secure, affordable, stable homes could save the government $11 million over 15 years per 1,000 households. This saving includes reductions in healthcare and associated welfare costs.

3. Social housing improves educational outcomes.

The Growing Up in New Zealand study shows housing instability significantly affects early cognitive development, school readiness, and continuity of education, particularly in the first five years of life. Frequent residential moves and unstable housing in the first five years of a child’s life correlate with poorer cognitive development, reduced school readiness, and higher school transience. Housing instability too often leads to disrupted schooling and diminished readiness for learning.

Similarly, evaluation research from the Housing Foundation and Tindall Foundation found that over 80 percent of residents who moved into stable, social housing reported improved wellbeing, with many parents noticing better school performance from their children.

The evidence is overwhelming. Stable, affordable housing is foundational to improved education, health, and employment outcomes for young people. It is a crucial component of reducing crime, which has flow-on benefits to all of society.

If the government is serious about addressing any of these issues, it must start by reversing their short-sighted cancellation of social housing builds and commit to building homes for social and public good.

What can be done?

We are not helpless in the face of callous decision-making. I do believe we have the power to make a difference.

Here are some quick ways to respond to the issues of homelessness and lack of social housing:

1. Write to your local MP.

Contact your local elected representative. Especially if you live in an area where housing projects have been cut. Share your views and ask them to publicly support the reinstatement of Kāinga Ora developments. You can find your MP and their contact details here.

2. Attend local council/community board meetings.

Local authorities can face pressure to rezone or sell public land, and often receive quite a few anti-social housing responses from NIMBYs. Let your local councillors know you support social housing. You can email them and also keep in touch with councillors to know when to attend local meetings and voice your support.

3. Raise awareness.

Sharing stories, your thoughts, and links to articles on social media can help shift attitudes and opinions. It can also help you feel less alone! A solid rant can do wonders for relieving the angst. Public support for social housing is much needed.

4. Sign up with Action Station.

Follow this link to sign up , and Action Station will be in contact with you to either link you up with an active campaign in your area or to help you start one. You don’t need to have any experience.

5. Vote in your local council and national government elections.

Ask candidates where they stand on social housing. Ask for a solid commitment to building social housing. Vote for those who advocate for evidence-based policy and investment in publicly owned social housing.

 

This article is reprinted with permission from Dr Bex on Social Issues in Aotearoa NZ, a reader-supported publication.

Dr Rebekah Graham (Pākehā) is a community psychologist and researcher based in Kirikiriroa/Hamilton. Her academic work focuses on the intersections and experiences of marginalised communities, with a strong focus on structural barriers and systems change.