New Zealand Property Investors' Federation

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Govt plans cuts to accommodation supplement

Labour says a reduction in the accommodation supplement handed out by Work and Income may lower the amount landlords are able to charge in rent.

By Susan Edmunds

But Housing spokeswoman Annette King said the Government was being deliberately vague about what changes were on the way.

In announcing this year's Budget, Finance Minister Bill English said the Government would be looking at ways it could make the $15 billion spent on social housing and the distribution of $2 billion in annual subsidies - like the accommodation supplement  - more efficient.

King said she had filed an Official Information Act request to find out exactly what that meant.

"How are they going to do that? Are they going to cut the amount that they give out?"

 She said each supplement was decided individually.

King said there were problems with the system. "The problem was highlighted years ago when the Salvation Army said they didn't believe an accommodation supplement would do anything other than increase the cost of housing."

She said it was likely that landlords factored in the supplement when deciding what to charge for rent.

But a Ministry of Social Development spokesman said the changes would primarily relate to students who would no longer be eligible for accommodation benefits. "Students who are no longer eligible for student allowance (and the associated accommodation benefit will be able t access living costs through the student loan."

Tags: annette king - bill english