Insurers are paying out 50 claims a month for costly P clean-ups – even though some may be unnecessary – while the Government continues to delay setting regulations to fix that and looks likely to keep people waiting for another year.
Sources tell Fair Go that officials at the Housing and Urban Development Ministry have given this no priority for two years, blaming Covid and a lack of staff; the Ministry told Fair Go they are now working on it.
"Officials expect to consult with the rental sector, scientific community and methamphetamine decontamination industry early next year,” says Associate Housing Minister Poto Williams.
Currently companies, government agencies and the courts use one of two different levels of P residue to determine if a home is contaminated – and neither is binding in law.
“It's costing millions of dollars, creating confusion, not just for the landlord, but for the tenants as well,” says Sarah Knox from the Insurance Council.
“There’s a housing crisis. it's now been two years and there's still no action, so we really want the Government to hurry up and get those regulations written.”
The real estate industry says it has been pushing too.
“The property profession is caught between a rock and a hard place without firm guidelines,” says Jen Baird, REINZ chief executive.
“With two sets of guidelines to follow, it is difficult to get a fair outcome.”
That’s highlighted in a case Fair Go has featured where a landlord has been hit with a huge bill her insurance won’t pay for and the courts won’t uphold.
“The whole amount of the claim was $14,000,” says Claudia Schoushkoff.
Schoushkoff has had to pay $9500 of that for cleaning and extra testing and lost rent after her tenant admitted a friend had used P in the Taumarunui home he’d rented from her.
After he moved out, she spent $3500 on detailed testing, but it showed residue was below the level where her insurance company Vero pays for cleaning up.
“Because it was 5.9 it wasn't high enough for them to actually come to the party," says Schoushkoff.
She took it to the Tenancy Tribunal which agreed with Vero – the tenant lost their bond and had to pay a total of $3800 towards the testing but was off the hook for twice as much more spent cleaning up and covering lost rent.
“They told me we can't ask him to pay for that because you've gone overboard with your cleaning. I couldn't understand that. I was just following the guideline of making sure we can re-rent the property,” Schoushkoff says.
Harcourts was managing the rental and one of its property managers had mistakenly told Schoushkoff she had no choice but to clean up to the NZ Standard for decontamination of methamphetamine or P, which is 1.5 microgrammes per 100cm2 of wall and if she didn’t she faced a fine of up to $4000 if she let the contaminated property.
But as Harcourts and the rest of the industry knows, those regulations aren’t in force yet and there would be no such fine until they are.
Harcourts general manager Bryan Thomson says the manager was doing their best with available information and argues a clean-up was necessary, otherwise “this would make the property difficult to rent at best, and difficult to maximise rental returns".
Because there are no regulations, the tribunal and Vero apply the findings of the most recent evidence – a report from 2018 by the Prime Minister’s chief science adviser Sir Peter Gluckman.
Sir Peter found any residue under 15 microgrammes of P or methamphetamine (on 100cm2 of surface) was not worth bothering about or cleaning.
He said at the time there is, “absolutely no evidence in the medical literature anywhere in the world of anybody being harmed by passive exposure to methamphetamine".
That was a jolt for the clean-up industry which is also working to the New Zealand Standard that it helped set a year before - remember that is 10 times lower at 1.5 microgrammes per 100cm2 of surface if it’s a well-used area of a home.
That was the guideline Claudia’s testing company, Betta, had used but the Tenancy Tribunal gave it a serve for making no mention of the Gluckman guideline, especially since the tribunal has been using it for three years and the District Court has been backing that up for two.
Betta Group chief executive Matt Mason says the Government needs to set those rules and until it does, his testers will keep working to the NZ standard.
“We believe that until we receive that clarification, adopting a conservative approach is the best way for us to help protect everyday Kiwi families.”
Claudia Schoushkoff doubts any of this protects anyone, apart from the people saying it’s not their fault the clean-up cost her nearly $10,000.
What can you do to protect your home until the Government acts?
Here's how insurance companies cover P clean-ups
Always check the specific policy as it may have terms and conditions like one claim per property.
Check what other coverage you need as P clean-up is only one risk for landlords.
Excesses will also vary.
Source: Insurance Council NZ
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