Internal Affairs Minister Brooke Van Velden announced a new review of the insurance-based levy for funding Fire and Emergency New Zealand (FENZ). Property Council warmly welcomes this news. It is something we have been requesting from Ministers since the conclusion of the previous FENZ funding review in 2021.Â
From Property Council’s perspective, the limited-scope 2021 review was a missed opportunity to shift the FENZ funding model to a more balanced, user-pays approach. It culminated in new levy annual rates which will take effect on 1 July 2026. We wrote about issues with the new levies in our March news story, including heavy impacts on insurance bills for some commercial building owners.
The new funding review comes as the Select Committee inquiry into FENZ’s fleet management reveals patterns of financial mismanagement and systemic operational failures. In addition, the New Zealand Professional Firefighters Union has been taking strike action since 2024 to protest FENZ’s ongoing underinvestment in staff and equipment. FENZ collects approximately $800 million a year, with 95% of this sourced from insurance-based levies.
Property Council is concerned about who is funding FENZ.
What does it mean for the property sector?
Under the current FENZ funding model, commercial property owners are paying more than their fair share towards the costs of our emergency services. As much as 65% of FENZ funding comes from levies on insurance policies for commercial buildings which protect against the risk of fire. This is disproportionate to the 5.5% of emergency callouts that involve commercial premises. Because of the mismatch, Property Council has long advocated for a model that aligns FENZ funding more closely with actual emergency service use and ensures all beneficiaries contribute fairly.
This review re-opens the dialogue between Property Council and Government about the fairness of FENZ’s funding model. It is a chance to achieve a genuine shift to a more equitable funding model that allocates costs efficiently across everyone that relies on our emergency services.
Ultimately, the cost of insuring commercial buildings should reduce.
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