01-05-2012

The announcement that the Department of Building and Housing (DBH) was to be moved into the new “Super” Ministry came as a shock to the industry last month. 

 

DBH had already been restructured for “efficiencies” and the general perception from all industry participants was that the service level had fallen dramatically. 

 

To provide some history, the Department evolved from being Tenancy Services and the Tenancy Bond Centre in 1986, when it operated under the Housing Corporation (now Housing New Zealand). In 1992, Tenancy Services and the Bond Centre split from the Housing Corporation and became the Ministry of Housing, which also provided policy advice to Government.

 

The Ministry of Housing changed to the Department of Building and Housing in 2005, starting to take on additional tasks such as building standards, tradesman certification and Weathertightness Issues. DBH has since become a very large department of which the Tenancy Service Divisions are now relatively small.

 

To confirm the general industry belief that service levels had fallen, the NZPIF undertook a survey of our members to identify if this was true or not.

 

We are continuing to get responses to this survey, however we analysed results so that we could take these to meetings we had organised with members of Parliament and appropriate Government officials.

 

Compared to a similar survey undertaken in 2009, we found that the time taken to get a Tenancy Tribunal hearing had extended from just over three weeks to just over five. The average loss for rental property owners over and above any bond money they received as compensation was $2,246.

 

Sixteen percent of respondents believed that the timeframe between making their application and attending the Tenancy Tribunal was acceptable, 31% were not happy with the timeframe and 51% said that it was not an acceptable timeframe.

 

Thirty three percent of respondents had their application returned to them because it was incorrect. 65% of the errors were not considered significant or were simple errors and 22% were a DBH error rather than the applicant’s error.

 

Based on these findings, the NZPIF advised the MPs that diluting Tenancy Services has resulted in severe problems for rental property owners getting tenancy problems sorted out and presumably tenants as well. The cost to rental property owners of not getting better access to justice was significant.

 

We recommended that Tenancy Services and the Tenancy Bond Centre divisions should not be incorporated into the new Super Ministry with the other DBH functions, but instead operated with Housing New Zealand under the previous Ministry of Housing. This would also help to ensure that the funds from holding bonds would not be diluted into a larger department but could be applied to improving the service level for the rental property industry. We believe that to make any significant improvement to the system, funds need to be directed to Tenancy Mediation Services and extra Tenancy Tribunal court time. Without this occurring we do not see the significant losses that rental property owners are currently experiencing being reduced to acceptable levels.

 

The Members of Parliament we spoke to acknowledge the problems our industry is facing and agreed that something had to be done to improve the situation. Whether that means that Tenancy Services will be kept separate from the new super ministry we will have to wait and see. Whatever happens, it is obvious that we must keep striving for better service and faster access to justice to stop the losses we are currently enduring.