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Leaky home scheme a failure: critics

Just 12 home owners have been fully paid out by the government's assistance package for leaky homes and the scheme - to address an $11-billion problem - is a failure, say home owner representatives.

Despite 1232 victims having applied for the package by September, the Ministry of Business, Innovation and Enterprise had finalised claims with 186 homeowners.

Thirty-five claims were proceeding, of which 31 had received one or more contribution payments.

But only 12 had received their final payments and Home Owners and Buyers Association president John Gray told the New Zealand Herald the scheme had failed.

The scheme, which became available in July 2011, sees the government pays 25 per cent of the repair costs of a leaky home, local government 25 per cent, and the homeowner 50 per cent. It also meant owners could not sue.

Lax building regulations in the 1990s mean that up to 89,000 homes could be leaky and prone to rotting resulting in health problems.

The estimated cost of fixing 42,000 homes has been estimated to cost $11b.

Tim Rainey of Rainey Law, who represents leaky home owners, says the take up is disappointing, and he blames excessive bureaucracy, long delays and difficulty getting jobs approved.

The repair scheme was based on the lowest possible cost, "so it's a cheap scheme. It doesn't give good outcomes," he said.

Last month leaky home lawyer Paul Grimshaw questioned why anyone would choose the scheme when they could get 100 per cent of remediation and other costs through the courts.