Housing New Zealand chief executive Andrew McKenzie. Photo: RNZ / Matthew Hutching
Kāinga Ora chief executive Andrew McKenzie is stepping down because an overhaul of the organisation is not what he signed up for.
Simon Moutter, who chairs the government's social housing agency, said McKenzie would leave at the end of October, after doing an "excellent job" over the last eight years.
The government had made a number of changes and signalled more would be on the way, in response to an Independent Review published last month, Moutter said.
- Read more: The Detail - A Crisis at Kāinga Ora
Led by former prime minister Sir Bill English, the review found the social housing system was not financially sustainable or delivering the homes needed.
"These changes are material to the chief executive role, reducing its scale and accountabilities significantly, and that was not what Mr McKenzie signed up for when he agreed with the board to extend his employment contract last year. As a result, Mr McKenzie and I have agreed that he will leave the organisation at the end of October this year."
The departure would be treated as a redundancy in line with the terms of his employment agreement, given the material reduction in the accountabilities of his role, Moutter said, confirming it would include a six-month salary payout, as compensation for notice and redundancy.
McKenzie's annual remuneration for the 2023/24 year was $731,000, according to Public Service Commission data, indicating the redundancy would result in a payout in the vicinity of $365,500.
"I have asked Mr McKenzie to stay on until October to complete some important current change processes as chief executive and then move across to assist me and the board with preparing the new plan that must be delivered to the government in November."
Moutter praised McKenzie's work as chief executive, first of Housing New Zealand and then Kāinga Ora.
"During that time he established the new Kāinga Ora organisation, lead it through Covid-19, improved tenant outcomes, built New Zealand's largest housing construction programme and delivered land that will see tens of thousands of new homes built over the next decade."
The independent review made seven recommendations, four of which the coalition government moved to implement immediately. Cabinet agreed to refresh the Kāinga Ora board, and to issue simplified direction to the agency. As part of the changes, the new board were to develop a robust plan to improve financial performance.
In May, Housing Minister Chris Bishop said the panel's "serious concerns about Kāinga Ora were valid", and there were also concerns about the agency's governance.
"Kāinga Ora is underperforming and not financially viable without significant savings, as well as funding and financing changes.
"Secondly, the wider social housing system is not delivering the results New Zealand needs.
"It's lacking in transparency and accountability, coupled with a poor understanding of tenant outcomes."
Speaking at his post-Cabinet media briefing, Prime Minister Christopher Luxon said McKenzie's resignation was a matter for McKenzie and the board.
However, the organisation had been "chronically underperforming" and as a result they were changing the chairperson and refreshing the board, Luxon said.
He disputed a former board member's claim the government's review of Kāinga Ora was an overreaction, saying given the amount of debt that was likely to be racked up, and the "huge amount of assets that are sitting there and how they are managed" that they had good reasons to order the review.
