Government offers 25% on leaky buildings if you agree not to sue

The leaky homes rescue package announced by Building and Construction Minister Maurice Williamson today is expected to cost the government $1 billion over the next five years but will fix only some of the damaged homes.

The package will see local authorities and government each contribute 25% of the repair cost and a government guarantee will back loans from major banks for half the remaining cost of repairs.

But it's first dependent on a group of negotiating mayors agreeing with the offer. They declined the last offer at 10%. The mayors are seeking the government's assistance because of the impact the leaky building repair costs have had on their insurance bills. They have also argued that  had a former government not relaxed the Building Code, that the problem would never have arisen.

And homeowners who take up the offer will have to relinquish their rights to take legal action against local authorities and the government, which may leave a large number of people still fighting through the courts.

An even if the mayors agree, the scheme won't be launched until next year.

The minister likened the impact of leaky homes to that of a natural disaster of huge proportions.

“It is having a considerable impact on the wealth and health of many thousands of New Zealanders and their families,” Mr Williamson said.

It was estimated in a PricewaterhouseCoopers report issued in July that there could be up to 89,000 homes affected by weathertightness issues. Only 3500 have been fixed so far.

"If, as officials forecast, 70% of affected homeowners within the 10-year liability limit take up this package, the government is anticipating its share will be around $1 billion over the next five years," Mr Williamson said.

"Once the local authorities have responded, the government will begin working through the complex details of how it will work with the parties involved. We are aiming to have the new package up and running early next year.”

The mayors have until May 31 to respond to the government’s proposal.

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8 Comments & Questions

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I wonder will the handout be just on the material ,who decides the formula?Will labour be included ,will the suppliers of the crappy timber,get another bite of the cherry, or will they be held culpable,and replace the original free under the ten year guarentee,IF NOT?WHY NOT?


Agreed - yet again the suppliers, builders and developers have ridden off into the sunset with profits and no culpability. As a taxpayer I feel cheated by the issue. Sure, I'm not affected but I'm not stupid enough to have bought a leaky home. Why should I pay the cost through my rates and taxes? I'm already bailing out the naieve finance company investors. The people who bought these properties need to take some accountability. At the very least the Government will need to apply a solid credit process and conservative gearing levels to avoid abuse. The Government would better serve the NZ public by fixing the gaps that have created the problem and allowed it to continue.


Stupid enough to buy a leaky home...umm the council signed it off didnt they as a solid structure - even with an inspection many years ago you expect a concrete structure to last longer than 10years before severe leaks.. Even leaky building home owners are now paying rates to fix up this problem. Tis the Developers who have made high profits , took short cuts got away with the bare minimum for sign off. And where are they when it comes to fixing up..No-where


pity the government and ministers that created this fiasco ar not disqualified from holding office again . problem is we would need to find some new faces for todays parliment . makes one sick to the stomich . in china they would be doing hard labour now least building prisons would have a positive affect which is oppisite to the present time and place.


Something for leaky home owners, something for investors in risky financial institutions, did they leave anyone out? Of course plenty of people would like the government to make them whole or partly whole from their troubles from various sources.

It seems like this government has no overall agenda to reduce moral hazard or regulation or loss socialisation policies. Management is doing things right, but leadership is doing the right things, and this government seems good at managing competing interest groups while taking a pass on leadership.


Most of the leaky home scandal can be traced to Greenies who knew best that Kiln Dried Timber would be the bees knees and treated timber would be outlawed,What a mess their unproven theory EG in NZ has created. All they had to do was look to Vancouver where the same disaster had happened.The same crazy Greenies indirectly caused the deaths of hundreds in the Victorian bush-fires not so long ago .They lobbied hard to prevent fire breaks in the bush and clearing of dead matter.What a legacy the named crackpots have left us with.


Once again that endangered species the true innocent NZ tax & ratepayer is to be stung to bail out some unfortunates, while as already mentioned many parties have already profited yet not held accountable. Layer upon layer of fault. What protection is now put into the system of any rebuilds to ensure this never happens again and the incompetents never work or trade again?


According to this article, there is a leaky homes rescue plan introduced by Building and Construction Minister Maurice Williamson which would cost $1 billion. It will fix some of the damaged homes.


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