By Mike Bain-The Daily Examiner.
New Zealand’s public housing agency Kāinga Ora, is aiming to help more tenants stay on top of their rent by taking a balanced approach to managing rental debt.
As a result the housing agency looks to write off $8.3 million dollars as it accepts the likelihood of collecting the debt was already low. It had arisen in part because of Kāinga Ora’s previous approach.
During the pandemic the steps taken to respond to government policy meant Kainga Ora didn’t chase debt in the way it normally would, and as such it’s management felt a measure of responsibility.
On Tuesday the agency announced a tougher stance on tenants who repeatedly fail to pay rent without any attempt to catch up, stating that it will end tenancies for those who persistently skip rent.
However, in a move to support long-term, consistently paying tenants, Kāinga Ora also plans to forgive and reduce the debts of customers who owe more than 12 weeks’ rent but have otherwise been reliable in their payments. This new strategy is intended to make the daunting task of tackling significant debt more manageable for tenants.
Chief Executive Matt Crockett speaking on Newstalk ZB on Tuesday emphasized the importance of early intervention in debt management, saying,
“We are going to manage it more closely, earlier, so that we never have customers that have more than 12 weeks. This is about cleaning up the situation we’ve got at the moment and resetting to move forward with a more pragmatic approach.”
This dual approach aims to ensure that tenants who are making genuine efforts to pay their rent are supported, while also holding accountable those who do not make any attempts to fulfill their rental obligations.
About 3% of Kāinga Ora tenants had more than 12 weeks’ worth of rent debt, he said. The tenant with the largest debt had more than $40,000 owing.
As part of the change in approach, those who were making repayments on their debt and paying their rent on time would have their outstanding amounts reduced to a more realistic level, said Crockett.
That was likely to mean $8.3m of the $16.17m owing would be forgiven.
