It also committed to a two-year “top-up” contribution so tenants reliant solely on superannuation would be “no worse off financially”.
The transition has since become contentious, with some residents continuing to campaign against the changes.
In March, Rāwhiti pensioner housing resident Mary Smith successfully challenged proposed rent increases, and seven other cases are awaiting a Tenancy Tribunal hearing.
Councillors Don Paterson and Trevor Maxwell both say they supported the move to partner with Emerge because they believed it would protect elderly tenants while creating a more sustainable model for ratepayers.
But both now say the outcome has not met expectations.
“I think it’s a portfolio we haven’t handled very well at council,” Maxwell said.
“I’m disappointed and we must keep trying. They’re human beings. They’re our vulnerable and elderly.”
Maxwell said early assurances had not been maintained.
“Right from the beginning, we were assured the tenants were the most important thing and that their rents wouldn’t be more than what they’d been paying, that kind of rhetoric,” he said.
“But that’s not been the case.”
Rotorua councillor Trevor Maxwell. Photo / Andrew Warner
Paterson was one of two councillors who voted against a review of the pensioner housing portfolio in July 2023.
He later supported the partnership with Emerge after accepting the existing model was becoming increasingly difficult to sustain for both residents and ratepayers.
Paterson said that decision was based on information that later proved inaccurate.
“We were told this gave us the opportunity to do both things: look after our older people and make it affordable for ratepayers,” he said.
“A win-win for everyone, so we were told.”
In April, the council acknowledged that assurances around financial assistance for tenants had been made without consultation with the Ministry of Social Development.
The ministry later advised that those financial assistance options were not available in Rotorua as the council had anticipated.
“The information wasn’t correct and had we known that it wasn’t applicable, this outcome would have been a lot different,” Paterson said.
A vacant unit at the Kahikatea St pensioner housing block. Photo / Mathew Nash
Paterson said he did not blame council officers, saying staff had “worked wonders” to find a solution to a complex problem.
“There were so many roadblocks with what we were trying to achieve because of legislation and legalities,” he said.
“Really, we were caught between a rock and a hard place.”
Paterson said the wellbeing of tenants remained one of his biggest concerns as a councillor.
“People say, ‘What keeps you awake at night?’ This is one of them,” he said.
“It does bother me that our elderly have been neglected.”
Paterson said the stress created by uncertainty was particularly concerning for older residents.
Rotorua councillor Don Paterson. Photo / Mathew Nash
“Our elderly, our older people need to be looked after,” he said.
“They’ve done their bit for the community, they’ve paid their taxes, they’ve paid their rates, they’ve made their contributions and they need to be given some reverence.”
He stopped short of blaming the council alone, saying the issue reflected a wider societal problem.
In April, council infrastructure and assets manager Stavros Michael said the move to market rents was necessary because the heavily subsidised portfolio had become financially unsustainable, creating a significant annual cost for ratepayers.
He said the council was continuing to work with Emerge Aotearoa and the Ministry of Social Development to maximise tenants’ entitlements within the limits of existing Government policy.
Many residents have now received a subsidised rent rate to minimise the financial impact.
He said the council “is committed to better and more sustainable housing and support outcomes” for tenants and ratepayers but that the tenants are the council’s “first priority”.
The future of the city’s largest pensioner housing complex, Lucas Place, is now at the forefront of the council’s pensioner portfolio changes.
The council is considering redevelopment, with many units considered beyond repair. The possibility has also attracted opposition from some residents, who are concerned about what it means for their future.
Paterson said he hoped any redevelopment would deliver for pensioners with minimal stress or impact on their lives.
“I hope we can have something that we can be proud of and that can house the people who need it most.”
Mathew Nash is a Local Democracy Reporting journalist based at the Rotorua Daily Post. He has previously written for SunLive, has been a regular contributor to RNZ and was a football reporter in the UK for eight years.
– LDR is local body journalism co-funded by RNZ and NZ On Air.