Emergency Housing Costs Six Times More Than Private Rent Subsidies

Lindsay Mitchell has been researching and commenting on welfare since 2001. Many of her articles have been published in mainstream media and she has appeared on radio,tv and before select committees discussing issues relating to welfare. Lindsay is also an artist who works under commission and exhibits at Wellington, New Zealand, galleries.

A reader kindly sent me a response she received yesterday from MSD. She’d asked if any cost benefit analysis has been made of Temporary Emergency Accommodation versus paying market rental. The answer was ‘no’. Hardly surprising. 

But MSD did supply a document containing some data from March 2020 quarter. Under a heading ‘Analysis’  the following observation appears: 

“The spend on Emergency Housing does not represent value for money.”

That’s the understatement of the year.

I’ve charted the three main spends:

Subsidising renters in the private market costs just a third of subsidising them in public housing, and a sixth of what’s being paid for motels, hotels and the like. 

Any cost/benefit analysis will show that government should get out of housing and confine itself to subsidising low-income private renters.

I understand why people complain loudly about the state subsidising private landlords but as matters stand, it’s still the most efficient way to house low-income people.

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