Community housing provider concerned at government announcement

Habitat for Humanity New Zealand is concerned that an announcement to establish a new tax exemption category for potentially deregistered housing charities misses the mark.

Reliant on a misreading of the relevant case law, the government’s announcement is being described as “problematic” and “concerning” by the charity.

Habitat chief executive officer Claire Szabo said since the recent deregistration of a Queenstown-based housing trust, semi-autonomous government agency Charities Services had been looking to review the charitable status of other housing entities, including Habitat for Humanity.

“Of particular interest is whether programmes that assist people into home ownership comply with a definition of charity, such as the alleviation of poverty.”

Ms Szabo said although the Queenstown charity was ultimately deregistered, the judgment noted that “assisting the poor to buy housing… can be charitable”.

“Now joint Ministers Bennett and McClay have put out a statement saying that the judgement found ‘assisting people into home ownership is not charitable’.”

“This is clearly incorrect. We are disappointed that the Ministers have decided to express this view on charitable status, particularly pending decisions of Charities Services about the future of the sector that deserve a fair hearing,” Szabo said.

“It appears to display a critical misunderstanding of the issues of social housing and charitable status. In the context of the wider social housing reform programme, this is deeply concerning,” Szabo said.

“We trust that the Ministers’ expressed views will not impact on our charitable status, and that the facts and nuances of the landmark judgment will been taken into full account,” she said.

The government announcement provided for tax exemptions and donee status for deregistered housing providers that fulfil certain criteria, and introduced an income threshold for the recipients of services of home ownership programmes

“For entities or charities which provide a range of services, like Habitat, the practical implications would require us to make constitutional changes, set up new entities and alter our infrastructure in ways which would be practically unworkable.”

“There are numerous problems with the deregistration of charities which are alleviating poverty through assisted home ownership schemes. And the new categories being proposed for such groups won’t work,” Craig McFarlane, Habitat for Humanity New Zealand Chairman said.

“The government needs to ensure that charities legislation does its job, rather than creating problematic alternatives and work-arounds,” McFarlane said.

ENDS

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