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A Horowhenua iwi is upset it is being denied a chance to acquire state houses in its rohe.
The Government was looking at transferring almost 250 Housing New Zealand properties in the region to a community housing provider working with iwi.
Last week it said a deal was off, because the two iwi involved are yet to settle their Treaty of Waitangi claims.
The Minister responsible for Housing New Zealand, Bill English, said a transfer would throw up too much uncertainty.
Muaupoko spokesperson Matt Sword denied iwi involvement would cause uncertainty for tenants, many of whom are iwi members.
He blames Treasury officials for the change in policy, and says one reason claims are unsettled in the region is because treaty negotiations Minister Christopher Finlayson paused negotiations so he could focus on what he considers more pressing areas.
Mr Sword says Muaupoko will keep talking to Horowhenua District Council about taking over its social housing portfolio of 115 pensioner units in Foxton, Levin and Shannon.
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