I’m not one to bother looking at corporate websites with their carefully photoshopped pictures and expansive, self-congratulatory language.
But this week I looked up the investors who want to buy 2,500 state houses in Christchurch.
Amy Adams, our most propertied MP and ironically the “Minister for Social Housing”, announced last week that three consortia had been selected to bid for the homes built by our parents and grandparents.
– Community Futures Christchurch (made up of Trust House Ltd, Whitehelm Capital Pty Ltd, and Broadspectrum (NZ) Ltd);
– Otautahi Community Housing Consortium (comprising Otautahi Community Housing Trust and Morrison & Co PPP GP2 Ltd);
– A consortium comprising Compass Housing Services Co (NZ) Ltd, AMP Capital Investors Ltd, and Brookfield Financial Australia Securities Ltd.
Each bidder is fronted by a “registered social housing provider” but behind them pulling the strings are the corporate money men.
Reading their websites is enough to bring up your breakfast.
If the “We believe…” and “Our values…” statements aren’t sickening enough then looking behind their PR descriptions should be. Here’s a short example from Whitehelm:
- Whitehelm is a long-term specialist investment manager that partners with clients to invest in assets that protect the real value of the investment whilst providing predictable cash returns.
- We achieve this through investing in assets that have clear and measurable cash flows and by paying a price that is below our fundamental assessment of long-term value.
- We seek to identify investment opportunities across the capital structure and transact opportunistically to take advantage of asset mispricing.
Translation: “We love government guaranteed cash (income related rental scheme subsidies) from Christchurch state house tenants and we’ll make sure we rip-off New Zealand taxpayers in the process of getting them. We’ll lie and tell the government they are “mispriced” and we’ll make a lowball offer like the other bidders”
Whitehelm have crawled out of Australia along with another bidder – Broadspectrum – a company even lower on capitalism’s evolutionary scale.
Radio New Zealand revealed last week that Broadspectrum’s parent company in Australia was running the infamous Manus Island detention centre and alongside the Australian government agreed to pay $73 million in an out-of-court settlement for horrendous mistreatment of detainees.
Presumably Amy Adams sees this Manus Island experience as an advantage for Broadspectrum in its bid for Christchurch state houses. Mistreating vulnerable people and putting the boot into beneficiaries is a National government speciality.
And what about the other consortium fronted by the Christchurch City Council’s Otautahi Community Housing Trust? Who are the moneymen behind this? It’s New Zealand’s Morrison and Co who manage infrastructure investor Infratil.
They are no different to the Australian companies in their rapacious behaviour. They made their money from the privatisation of New Zealand state assets over the past 30 years and they aim to continue their role as one of the biggest parasites on the New Zealand taxpayer.
It’s important to understand the huge sums to be made from this deal. As well as the government guaranteed income from rental subsidies there is huge money in the redevelopment of areas of state housing as is occurring in Tamaki now.
A block of say six state houses can be demolished and replaced by 18 units with only six needing to remain as state houses. The rest will be sold for private profit.
In reality, this sale is a massive corporate landgrab in the heart of Christchurch. For example, the entire suburb of Bryndwr, which is surrounded by much flasher suburbs, will be stripped completely of state houses in favour of housing for the wealthy. Land values in Bryndwr will skyrocket as replacement state houses are built in lower-income suburbs where land values are much lower.
No wonder the money men are having wet dreams at the prospect. The tragedy is that we have a government and local city council aiding this private theft of the commons.
It is the biggest step yet in the government’s plans for the largest privatisation in New Zealand history – our $18 billion state house network.
If you think this stinks then help us fight it.
You can donate to Housing Action Canterbury which is working hard to make this the biggest election issue in Christchurch this year. We have a $10,000 fighting fund set up and have used it in part to pay for a wraparound on the Star newspaper into 92,000 Christchurch homes.
We have a whole lot more to do. If you can help please send a donation to:
Account Name: Housing Action Canterbury
Account Number: 38-9017-0034814-01
You can be assured you will get a good bang for your buck.