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Kāinga Ora - Homes and Communities Bill signals powerful new Crown agency

May 31, 2019

Contacts

Partners Matt Conway, Gerald Lanning, Bill Loutit, Padraig McNamara, Jonathan Salter, Sarah Scott, James Winchester
Senior Associates Kate Stubbing

Government reform and public policy Māori business Urban development Infrastructure (inc funding)

The introduction of the Kāinga Ora-Homes and Communities Bill on Wednesday signals the creation of a powerful new Crown agency that will be responsible for implementing much of the Government’s housing and urban development agenda.

Stage 1: the Kāinga Ora - Homes and Communities Bill

The Kāinga Ora - Homes and Communities Bill disestablishes the Housing New Zealand Corporation (Housing New Zealand) and HLC (2017) Limited (HLC) and assigns their roles to a new agency, Kāinga Ora - Homes and Communities (Kāinga Ora). The KiwiBuild Unit, which is currently part of the Ministry for Housing and Urban Development, will also become a part of Kāinga Ora. The Bill intends for the new Crown entity to be up and running by 1 October 2019.

Housing and Urban Development Minister Phil Twyford has said that bringing the three organisations together will end duplication and the splitting of key roles, fragmented decision-making and limited coordination between agencies that has been occurring up until this point. In turn, the Government hopes this will help achieve its goals relating to improving the supply of housing.

As the landlord for the Government’s state housing portfolio, Kāinga Ora will become an immensely important agency for many people. The housing functions of Kāinga Ora (clause 13 of the Bill) are similar to those of Housing New Zealand (s 18 Housing Corporation Act 1974). However, the urban development functions are broader than Housing New Zealand’s, reflecting some of the Government’s future ambitions in the urban development sphere beyond simply the provision of housing.

The new Bill is also more specific in terms of the Government’s expectations of Kāinga Ora, which are expressed numerous operating principles, compared to its expectations of Housing New Zealand as set out in the Housing Corporation Act 1974. Specifically, in performing its functions the Bill requires Kāinga Ora to provide good quality rental housing, to support tenants to be connected to their communities, to support tenants to live independent lives, and to be a fair and reasonable landlord.

The Bill also requires Ministers to issue a Government Policy Statement (GPS) before 1 October 2020 and then requires Ministers to review that GPS every three years. The GPS must set out the Government’s directions and priorities as to housing and urban development, and how the Government expects Kāinga Ora to manage its functions and operations in relation to those directions and priorities.

The Bill also has a specific focus on Māori interests. Kāinga Ora cannot make use of Housing New Zealand’s exemptions to override Māori rights of first refusal, and it must:

  • uphold the Treaty of Waitangi;
  • understand, support, and enable Māori interests in relation to housing; and
  • engage meaningfully with Māori.

Stage 2: a powerful new Crown agency

A second Kāinga Ora Bill, which will be introduced later in 2019, will make Kāinga Ora responsible for delivering urban development of all sizes. This encompasses housing, transport links, commercial and industrial buildings, new infrastructure, parks and open spaces and supporting facilities (such as schools, libraries and swimming pools). Unlike in previous attempts to increase housing supply (for example the Housing Accords and Special Housing Areas Act 2013), Kāinga Ora will take responsibility for building houses, rather than expecting the market to do this by taking advantage of a more favourable consenting regime.

Most controversially, the second Bill will allow Kāinga Ora to access a range of significant statutory powers to fast track urban development for large-scale and complex projects, called “specified development projects”.

The process to establish a specified development project includes two stages of public consultation, Ministerial oversight, and review of submissions by an Independent Hearings Panel. There are no indicative timeframes for this process however it is intended to streamline the current process. Once a specified development project is established, Kāinga Ora will have wide reaching planning and consenting powers in order to achieve pace and scale. Cabinet papers released by the Ministry of Housing and Urban Development suggest that Kāinga Ora’s powers will include the ability to:

  1. produce a development plan for each specified development project that outlines how the development will be undertaken and set out resource management planning rules;
  2. override, add to, or suspend land use rules in the district plan, regional plan and regional policy statements;
  3. issue resource consents, and undertake compliance and monitoring of consents;
  4. remove, change or replace, or put in place designations for infrastructure; and
  5. act as a heritage protection authority.

Those Cabinet papers also suggest that Kāinga Ora will have the power to:

  1. access funding for infrastructure and development activities;
  2. reconfigure reserves (certain types, with approval of the Minister of Conservation);
  3. acquire private land under the Public Works Act 1981; and
  4. suspend, make or amend bylaws.

These details will be included in the second Bill later this year.

Conclusion

Perhaps unhelpfully, the Government has chosen to use two Bills to establish Kāinga Ora. Interest from across the public, private and not for profit sectors is likely in relation to the powers conferred under the second Bill, whereas interest in the first Bill may be more limited. Nevertheless, the first Bill has important provisions about Kāinga Ora’s purposes that could be influenced by making a submission. In particular, those who deal with the entities that are disestablished by the Bill may also want to make a submission on this first Bill. This could also be a way of signalling what you think should be included in the second Bill. Please get in touch with any of our contacts for assistance with preparing a submission.

Contributors chris.ryan@simpsongrierson.com