Kāinga Ora more than halves builders as public building programme slows

Wednesday, 13 August 2025

Kāinga Ora has more than halved the number of building contractors it employs as its house building programme shrinks.

The Government’s role in a deep construction downturn has continued to be debated this week, as Cabinet ministers insist macro-economic conditions are responsible for liquidations and the loss of 18,000 jobs in the sector over 18 months.

However, the Labour Party has received data from Kāinga Ora, the Government’s state housing builder, showing how a decline in the building programme has shrunk the number of contractors employed by the Government.

“The lack of building is contributing to a huge slowdown in construction,” said Labour Party housing spokesperson Kieran McAnulty.

“Many people working in construction are now having to look overseas for work that should be available here.”

The data shows that in June 2023 there were 71 building companies constructing 3412 homes across the country. As of June 2025 this was 28 building companies constructing 488 homes.

Underneath each building company contracted for a Kāinga Ora build would be sub-contractors such as electricians, plumbers and joiners.

McAnulty said the Government was not only building fewer houses, but making it harder for people to obtain emergency housing -- forcing more people into the street.

Sector leaders have in recent weeks told The Post the state house building programme was an “anchor” for the construction sector.

Across the construction sector, the cancelling of Government projects and dialling down of building to cut costs has been blamed for the depth of the downturn.

Infrastructure Minister Chris Bishop last week insisted such criticism was “wrong”, though he acknowledged both the Kāinga Ora and school building programmes had been changed to drive down costs.

“We built more school classrooms last year than we did in 2023, so it's just factually wrong,” he said.

“In net terms Kāinga Ora built 2600 new state homes last year, and… there was [community] housing on top of that as well. It's just wrong.”

He said Kāinga Ora was 5% of the construction market, so any effect of this was “really on the margins”, and the major problem was residential construction consents were down due to high interest rates -- which were coming down.

Kāinga Ora, in publicly released material, said in the 2024/25 year it remained committed to building 3400 homes, while disposing of 1170 homes, meaning a net increase of 2230.

This net increase in houses would shrink in the 2025/26 year to 420 homes.

Despite the sentiment, the Government on Tuesday sought to promote its work to improve the sector’s fortunes.

Building and Construction Minister Chris Penk, responding to questions from a colleague in the House, pointed to a survey run by Kennards Hire showing optimism in the industry’s growth in the coming five years.

“The Government has $6 billion worth of infrastructure projects that are lined up to commence before Christmas, and plenty more beyond that,” Penk said.