Auditor-General slams MSD on emergency housing

The Auditor-General’s inquiry into the Government’s funding of emergency housing reveals a shocking waste of taxpayer funds, and raises serious questions about the financial control being exercised by the big-spending Ministry of Social Development (MSD), National’s Housing spokesperson Nicola Willis says. 

The Auditor-General inquiry reported on today was initiated following a complaint from National MP Simon O’Connor about the way MSD had used taxpayer funds to procure emergency housing accommodation.

The inquiry concludes that MSD paid exorbitant sums of $2000-$3000 per week for private rental properties for use as emergency accommodation, when the median rent that would typically have been paid for those properties was between $450 and $560 a week. The report concludes that “the Ministry could not demonstrate that it received value for money” and that the high rates MSD was paying for emergency accommodation “will have distorted the rental market”.

“The Minister for Social Development must explain who will be held accountable for this shocking mismanagement. She must assure taxpayers of what has changed at MSD to strengthen the systems, processes and oversight controlling the use of taxpayer funds,” Ms Willis says. 

“The Minister must make it clear that the wasteful, sloppy approach revealed in this report is completely unacceptable from a government agency. There must be consequences for failures of this magnitude.

“Taxpayers need confidence that these mistakes will never be repeated. Sadly, there is ongoing reason for concern. 

“Emergency housing has exploded under Labour. Today, the Government continues to spend around $1 million a day on emergency accommodation for more than 8,000 New Zealanders. How can taxpayers have any confidence this represents good value for money when it’s being overseen by the same agency that created the mess revealed in this inquiry? 

“What plans does the Government have in place to ensure the mistakes revealed in this report aren’t repeated when New Zealand reconnects with the world and motels once again fill up?

“The Government must ensure value for its use of taxpayer money. This inquiry shows it has fallen very short of that standard. The Minster must now step up and ensure this can never happen again.”