A High Court judgement made on Friday 24 June has cast a cloud over the Government’s intention for third sector housing providers to grow the pool of affordable housing in New Zealand.
The reserved judgement by Justice A. D. MacKenzie dismissed an appeal by the Queenstown Lakes Community Housing Trust (QLCHT) filed nine months ago for retention of its registration with the Charities Commission as a charitable entity, and may yet be subject to further appeal.
“Aspects of this case clearly fly in the face of what has been a leading example of a successful local housing trust based on an identified community need backed by both local government and by central government,” says David McCartney, Executive Officer of Community Housing Aotearoa.
“A point that seems to have been missed is that QLCHT has been filling a housing gap unique to its locality and that would not otherwise be filled. That was recognised again as recently as last month when QLCHT received a $700,000 government subsidy towards a $1.75 million project under the last funding in the Housing Innovation Fund for not-for-profit housing organisations.
“QLCHT is not a huge corporate entity. It has operated legally in addressing a new category of need as it arose, with trust and confidence in a commitment made by the Charities Commission that charity laws in New Zealand must be flexible and adaptable and able to evolve to meet modern conditions. This now leaves our sector with many more questions than answers, for instance:
- What gain is there in potentially quashing QLCHT’s innovative approach and ignoring new initiatives such as its Rent Saver programme (endorsed by Housing New Zealand)?
- This judgement states outright that home ownership is neither a need nor a right. Will this lead to a situation where all assistance towards a traditional culture of home ownership is considered non-charitable? What implications does this have for the government’s view of the charitable sector’s key role in promoting a continuum of housing?
- An area QLCHT appears to have been found fault with is in the provision of housing to people who earn above the NZ median income as well as those who earn below the NZ median income as a de-facto measure of poverty. Does this mean that variations in median income based on location mean nothing?
- Because the Charities Commission doesn’t operate a formal hearing process the only resort for QLCHT has been the High Court. Is that fair?
- If charities that deliver a public or community benefit were deregistered on the basis that they achieve that benefit by means of assisting individuals or individual households, how many charities of any kind would we have left?
“Overall we believe the legal technicalities of this case and a mixed bag of case law is obscuring the nature of housing dynamics related to the changing context of social and affordable housing at a time that couldn’t be less helpful,” says David McCartney.
“On the other hand this judgement has confirmed at a higher level that the provision of affordable housing falls fairly and squarely within charitable purposes, especially where a particular community gains social cohesion and betterment as a result. There is also a firm indication of the acceptance that urban and rural regeneration in areas of social deprivation be regarded as charitable.
“Those aspects of this latest judgement at least give our sector valid confidence that not-for-profit housing organisations have definitely not been placed outside the Charities umbrella and will not be subject to a damaging domino effect”.
“Looking ahead constructively, with community housing providers starting to play a more prominent role in meeting New Zealand’s social and affordable housing needs, what we really need from the whole of government is a legislative environment that provides incentives for investment in our sector”.