What should New Zealand do to seize the crisis and build back better?

The COVID-19 lockdown in March 2020 marked the beginning of what could be described as a new era for New Zealand. Our shared experience and strong collective response to the virus has changed how we see ourselves as New Zealanders: we are now the ‘team of 5 million’. And by staying at home, New Zealanders saved many lives. But the lockdown situation also highlighted the critical ways that our homes and neighbourhoods impact our wellbeing. It brought renewed focus to our systemic housing issues: from crowding and affordability stresses, to the lack of healthy, secure and fit-for-purpose housing. With a new policy agenda and fiscal means for urban development, New Zealand has a timely opportunity to address these challenges, and to solidify the legacy of the ‘team of 5 million’ and the wellbeing of current and future generations. This essay argues that to build back better, the urban development sector must value housing as infrastructure. With this stance, we can deliver transformative, integrated infrastructure programmes and quality, secure, affordable homes for all New Zealanders.

Housing is essential infrastructure.

Infrastructure is defined as ‘the system of public works of a country, state, or region (1)’ or ‘the basic systems and services... that a country or organization uses in order to work effectively (2)’. Traditionally, this understanding includes network systems such as telecommunications, roading and rail, energy, education and healthcare facilities, but excludes housing. Secure, quality, affordable and fit-for-purpose housing is arguably fundamental to people’s health and wellbeing, and the effective social and economic functioning of a country, region or city. Great housing also delivers benefits beyond their own walls, from improved educational achievement and public health to strengthened employment and social outcomes. But, at present, the New Zealand housing system is not supporting these wellbeing outcomes for many households, especially low to middle income households, key essential workers, people with disabilities, Māori, Pasifika and other minority cultural groups (3). Also, many renters in New Zealand (4) live in poor quality homes that are cold, damp, mouldy or crowded with serious impacts on their health and wellbeing, regardless of pandemic restrictions (5). On this basis, with a similarly serious housing crisis, research (6) from Australia, has built up interest in ‘reconceptualising social housing as a form of essential infrastructure ... to attract additional investment, especially from private sector sources (7)’ . In this post-COVID-19 era, New Zealand would benefit from a similar reconceptualisation of housing as essential social and physical infrastructure, and infrastructure that can be built back better.

Public works programmes that value housing as critical national infrastructure have not been seen in New Zealand since the decades following the Great Depression and World War II. This era turned an economic crisis into an opportunity to develop New Zealand. The welfare state was developed, including a significant government housing programme which gave many New Zealand families the opportunity to affordably build (or buy) their own homes, or rent secure state housing. The scale of public works programmes across infrastructure sectors in this period have had an enduring impact on our homes and communities, from the physical form of neighbourhoods, cities and regions, to our lifestyles, ideals, identity and overall wellbeing as New Zealanders. For example, housing and family ideals from this era have persisted in our housing system (8).

Despite this strong legacy, New Zealand society has changed and become significantly more diverse, such that past housing ideals are no longer serving all New Zealanders well (9). In 2020, we are a multicultural nation with a growing population demanding a range of housing options to meet diverse needs across different life stages, lifestyles and income levels. Housing situations directly impact our health and wellbeing, but these situations are firmly influenced by the available housing choices. Intensified lived experiences of housing during the COVID-19 lockdowns highlighted how, for many, our housing choices don’t necessarily reflect our ideal housing option or meet our housing needs. Housing choices are ultimately constrained by what is provided by the market. Poorer wellbeing outcomes from unsuitable or lacking housing choices are a symptom of our shamefully insecure, inequitable and unaffordable housing system (10). This system values housing primarily as a commodity, rather than a public good. For example, despite a post-pandemic recession, property market prices continue to grow, outpacing income growth, increasing housing costs and widening inequality between homeowners and renters. In this current market-based system, our housing infrastructure is not being valued adequately as essential social and physical infrastructure, most evident because it is failing to support the basic needs and wellbeing of all New Zealanders. So, how do we build back better? We need to value housing as critical infrastructure and act on this by delivering a national public housing programme akin to the post-war housing build - in scale, quality and social and economic impact. We could even bring back the Ministry of Public Works (11) to oversee the delivery of all public infrastructure, to create thousands of jobs for New Zealanders, to boost our economy, and to build better homes for current and future generations.

The infrastructure system must include housing.

The infrastructure sector in New Zealand is currently focused on physical infrastructure like transport, energy, water, telecommunications and social infrastructure (12). But to truly deliver for wellbeing in urban development, we must consider infrastructure as a system that is connected to and inclusive of housing. This is challenging at present, with the disconnect between how urban development programmes (e.g. urban regeneration by Kāinga Ora), and major public infrastructure is nationally funded and delivered, whereas local civil infrastructure is funded and delivered by local government. The delivery of integrated and transformative infrastructure investment in this post-COVID era, would benefit from a change to the infrastructure funding and delivery systems in New Zealand. We need to align local and central government infrastructure funding mechanisms or create a system where the ‘risky’ precedent of central government funding local infrastructure for housing, for example, isn’t a risk but instead an efficient public service mechanism. A 21st century Ministry of Public Works could help to resolve these tensions.

Furthemore, our communities will benefit from an infrastructure investment agenda and urban development legislation, which collectively value the critical role of housing in well-functioning urban environments. Recent reconfigurations and reforms to the government’s housing and urban development agenda, structures and legislation will improve infrastructure and urban development outcomes for wellbeing. These include a new Housing and Urban Development Ministry (HUD) which was established in 2018 to “help the Government build New Zealand out of the national housing crisis and restore the basic right to healthy, affordable housing for all New Zealanders (13)” . In 2019, the urban development authority Kāinga Ora - Homes and Communities was formed with the objective “to contribute to sustainable, inclusive, and thriving communities”, including providing New Zealanders with “quality affordable housing choices that meet diverse needs (14)” . Combined with the wellbeing mandate from the Treasury, the new National Policy Statement on Urban Development (15) and growing political support for reform of the Resource Management Act, the coming decades will see significant change and improvement in how urban development and infrastructure investment will support the wellbeing of New Zealanders.

While these changes to the urban development agenda and governing legislation are not insignificant, they are not adequate to fundamentally address our housing crisis or to make the most of the post-COVID opportunity to build back better. The current fiscal plan to support households, communities and businesses through the effects of the COVID-19 pandemic, the 2020 Rebuilding Together Budget, is significant and unprecedented (16). But as a once-in-a-generation investment in the wellbeing of New Zealanders, bolder measures are required. As already proposed, New Zealand needs to re-establish the Ministry of Public Works to administer an integrated public infrastructure programme. This should include a major public housing programme administered by the state to deliver housing independent of the market, to meet our diverse housing needs. Recent recommendations from the Welfare Advisory Group support this suggestion for a housing programme not too dissimilar from post-war recovery programmes in New Zealand, highlighting the importance of spending on social infrastructure (17).

The WAG found that major housing developments can provide a similar scale of employment and support to the economy as more conventional large economic infrastructure developments and thus are appropriate economic stimulus in this situation (18). Indeed, our nation reaped the benefits of large-scale public housing development post-war, but we’ve fallen behind. New Zealand desperately needs a shift-change in the infrastructure and urban development sectors to address the pre-existing housing crisis and to meet the economic challenges (and opportunities) of the post-COVID era. This strategy to deliver housing as essential infrastructure will offer wide ranging wellbeing outcomes for decades to come.

In conclusion, the post-COVID era presents a once-in-a-generation opportunity to build back better and to invest in the wellbeing of New Zealanders, current and future. A case for valuing housing as essential infrastructure, and as part of an integrated system of infrastructure has been presented. The renewed housing and urban development policy agenda is considered an improved position, but New Zealand requires a bolder agenda, and new mechanisms and means to make the best of this significant post-COVID opportunity. On this basis, New Zealand should deliver a major public housing programme, using an instrument like the past Ministry of Public Works to deliver integrated public infrastructure, to create jobs, better homes and a better country for our people. Wellbeing, health, productivity and resilience all start from home, but we are already behind amidst a severe housing crisis. Thus, at this time, major investment in housing as infrastructure is crucial, strategic and wise. Generations of New Zealanders will benefit from a post-COVID response that uses this crisis to solve another crisis. Let’s make the most of the major Rebuilding Together investment and build better homes for New Zealand in the process.

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References

(1) Merriam-Webster Dictionary

(2) Cambridge Dictionary

(3) Johnson, A., Howden-Chapman, P., & Eaqub, S. (2018). A stocktake of New Zealand's housing. Ministry of Business, Innovation & Employment; Allen, N., Dale, M., and O’Donnell, G. (2019) Diversifying the Housing Ecosystem: A Case for Change. Kāinga Ora - Homes and Communities [unpublished]; Kake, J. (2020) Māori Housing Issues in Election 2020. The Dig. Retrieved from: https://thedig.nz/transitional-livelihoods/maori-housing-issues-in-election-2020/

(4) Renter households, and those on lower to middle incomes disproportionately experience housing affordability stress (Mitchell, 2019) and poor housing quality (White et al., 2015). Māori and Pacific households are over-represented in housing deprivation statistics such as declining home ownership, increasing renting, increasing homelessness and public housing tenure (Tanielu, 2019; Amore, 2016; Johnson, Howden-Chapman & Equab, 2018). Disabled people are also particularly disadvantaged in securing affordable, fit-for-purpose housing.

(5) Early evidence suggests that lockdown and inadequate housing situations intensified some housing-related health issues. Comprehensive data on health impacts is not yet available, however this article from NZ Doctor highlights a significant increase in Rheumatic fever, a disease caused by household overcrowding. Refer also: https://www.nzdoctor.co.nz/article/undoctored/spike-rheumatic-fever-coincides-launch-unprecedented-research-funding

(6) Flanagan, K., Martin, C., Jacobs, K. and Lawson, J. (2019) A conceptual analysis of social housing as infrastructure, AHURI Final Report No. 309, Australian Housing and Urban Research Institute Limited, Melbourne, http://www.ahuri.edu.au/research/final-reports/309, doi: 10.18408/ahuri-4114101.

(7) Ibid. p. 1

(8) Also, the western nuclear family-unit household who owns their own home is no longer an accurate or appropriate assumption for the ideal housing situation.

(9) Home ownership rates have fallen to their lowest levels since the 1960s: now, just over half of New Zealand adults own their own home (Johnson, Howden-Chapman and Eaqub, 2018). Equally, the long-held kiwi dream of a standalone home on a quarter acre section is often inappropriate, unattainable and unaffordable for many households.

(10) Johnson, Howden-Chapman & Eaqub (2018); Allen, Dale & O’Donnell (2019)

(11) The New Zealand Ministry of Works (various names across history) was disestablished in 1988 after more than 100 years serving New Zealanders.

(12) Refer https://infrastructure.org.nz/

(13) https://www.beehive.govt.nz/release/new-ministry-brings-leadership-and-focus-housing-and-urban-development

(14) Kāinga Ora - Homes and Communities Act 2019, s12(1) http://www.legislation.govt.nz/act/public/2019/0050/latest/LMS191164.html

(15) Intensification is especially enabled in locations close to rapid transport services and from the removal of parking minimums.

(16) The $60b+ ‘Rebuilding Together’ 2020 Budget, seeks to “grow jobs and support New Zealanders and the economy through the effects of COVID-19 and the global recession”. This budget includes $3 billion worth of ‘shovel ready’ infrastructure projects that would provide or retain 20,000 jobs, $464m for housing and urban development including a target to deliver 8,000 additional public and transitional houses, and provision for the horizontal and vertical infrastructure required for housing.

(17) https://www.stuff.co.nz/national/health/coronavirus/121423308/coronavirus-welfare-advisory-group-calls-for-postwar-style-house-building-programme

(18) Ibid.