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The rich get richer, the poor get poorer: The CGT failure is a story of modern NZ

Emily Writes was disappointed by yesterday’s capital gains tax news – but after years of government inaction on housing inequality, she wasn’t surprised.

I found out that Jacinda Ardern had chucked plans to impose a capital gains tax through my group chat. Each day, my girlfriends and I chat throughout the day about various things ranging from TV recommendations to what to wear to a wedding, a bit of gossip, and always Antoni from Queer Eye‘s latest thirst trap.

Of the eight of us, three own houses. One bought the family home from their parents. One is mortgage free. One received parental support for their deposit. Of those who rent, two of us live with our parents or in a house owned by a parent. One is actively looking for a house. One is providing financial support to their own parent. None own more than one home – the home they live in.

All of us are aged in our thirties and forties and all of us support a capital gains tax.

The news of the dumping of plans for a CGT didn’t capture our attention for long.

To me, it just felt like … nothing.

The rich getting richer and the poor getting poorer is just what New Zealand is. It’s hardly news.

I gave up hope at the last election. We’re not a fair country and, in my life at least, I’ve never considered us to be fair. And while I was thrilled that Jacinda Ardern became prime minister, simply because I liked the idea of not being embarrassed by our prime minister, I’ve never thought anything would change for my friends and I. I just hoped things wouldn’t become worse.

My family and I are lucky. We rent from family so our housing is stable. We will not be kicked out. This is the ideal scenario for us, because owning a house is so impossible we didn’t even consider it. As long as I want to keep being a writer, and my husband wants to study, we will never be able to afford to buy. That’s just how it is. We have long since accepted that the work we do isn’t considered to be of much financial value. As a teacher aide, my husband is not valued by the Ministry of Education, but he is valued by the students he works with every day. As a contractor to various charities and a sometimes speaker and writer, I’m thrilled that I earn enough to have food on the table every night.

We don’t expect to have more than that. But we consider ourselves immensely lucky simply because we have stable housing.

We have lived in rentals that were so cold we had to sleep in one room with all of our coats piled on top of the bed, a privilege we paid $300 a week for. We were eventually kicked out so our landlord could renovate for his son to live in the flat – because he would never have his son live in such a dump. Only people like us could live there.

We have watched our friends with kids face evictions because the landlord wants to renovate after seven years of having their shitty, mouldy, damp hovel inhabited at $450 a week. We have watched our friends with children in hospital with ours return to a “home” that has windows that don’t close properly in the Wellington winter. Black mould on the backs of curtains that they replace through the Curtain Bank because the landlord doesn’t think it’s a problem. We have seen friends face six-monthly rent increases simply because the government is talking about capital gains tax and that’s enough for a landlord to get a bit more money. Other landlords suggest everyone gets pay rises annually so it makes sense to increase rent annually.

That at least gave us a laugh – imagine getting a pay rise.

They increase their rent in small amounts, secure in the knowledge that it’s “not much”. Because to them it isn’t much. It’s money they won’t even notice week to week, but it’s money that will be the difference between my friend eating as well as her daughter.

I’m lucky because I have family support. In that respect life is easy for me. Simply removing the stress of having stable housing is huge. It’s massive. If we can’t afford rent, we can just tell our family member. So I have privilege in having muted outrage. I’m not outraged, I’m just resigned.

This is what I expect from government – any government.

We are obsessed with looking at the harm of things like “screen time” for children but won’t have a public conversation about how some children have lived in ten different homes before they’re five years old. How some kids live in cars because, with 42 days’ notice and landlords openly saying they won’t rent to families, their parents have no other options.

The waiting list for getting an assessment for early intervention for children in my city is 178 days. If you have a child with a disability, and you move out of the catchment area, you’ll start at square one. You miss just one letter about your child’s appointments, you’re lost in the system. If you’re living in a damp house (you’ve got a great chance of this if you rent in Wellington) you face regular hospital visits for respiratory health issues for your children. We have always known the link between poor quality housing and child health – it just seems we don’t care that much. Or at least, the feelings of landlords and people who hoard houses matter more.

SOURCE: CHILD POVERTY MONITOR / CHILDPOVERTY.CO.NZ

Parents are moving to whatever area they can rent in. A friend moved from from the North Island to the South Island after applying for hundreds of homes for herself and her child. Some parents are turning to house sitting because they cant afford to rent, living in 17 homes in a year.

A Whangarei mother pays $250 a week to live in a friend’s garage with her daughter. She has been there for a year and two months. In a piece for The Spinoff’s Rent Week, a solo mum talked about how she and her child were in their seventh shared house. “We’ve been here for two and a half years and in that time I’ve signed three fixed leases and had four rent increases. My lease is due for renewal in a few weeks and I’m sure the rent will increase again. I’m just glad they haven’t given notice for us to move out. I have no choice but to keep paying more; the rental situation in Wellington is terrifying.”

Another talked about behavioural changes in her child: “My son got really aggro after we kept moving him every six months. Because he was always the new kid and being rejected, he started being really in-your-face to other kids and stuff. Or the places were just terrible, with no choice for kindy, so he’d end up constantly with nits, infected eyes; one place he would come home with bite marks and bruises all the time… it’s just awful.”

In the same article, social policy researcher Dr Jessica Berentson-Shaw talked about public housing providing security – but her comments relate to tenure in any housing situation for families. “Due to the security of tenure there is less mobility in those [public housing] households, so the kids aren’t moving from school to school to school and it’s increasing their social cohesion and security. Public housing means kids get to stay in one place which is really good for their education and really good for their sense of security and social cohesion.”

“There are also community benefits which then rolls on to have benefits in their adult lives. There has actually been data from the Growing Up in NZ study which found that regularly moving house for kids in New Zealand, which is much more common in the rental private market than in public housing, leads to problems accessing social services, education, benefits and healthcare, and it has a really big effect on family support networks and friendships. All of that stuff impacts on a kid’s physical and intellectual development, which of course has roll-on effects as an adult.”

We of course know this. It’s obvious. Is it healthy for a child to have to live in multiple homes, never feeling settled, never feeling like they’re part of a community – or if they are, that community is snatched from them because their parents can’t afford to pay another rent increase on minimum wage?

We know that’s damaging.

We just…are not too fussed about it as a country.

So kids suffer. So what? Making landlords pay for the profit they earn from their “work” is unfair. End of story.

This is New Zealand. There isn’t any incentive to make it better. There’s no “mandate”.


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