For six glorious, halcyon days in late February this year, the community housing sector in Victoria was in a suspended state of disbelief that there would be $800 million a year directed to social housing – the biggest reform since the 1960s. Then came the intimidation ahead of an upcoming election.
Australia is in the midst of an affordable housing and rental crisis. A perfect storm of high demand, limited supply, and low interest rates has been allowed to gather over the past two decades.
Despite sustained efforts since the start of the pandemic, homelessness is predicted to rise. Like rising waters against the banks of a levy, without prudent measures from governments, this issue will continue to overwhelm already overstretched service providers and further compound social inequity across the country.
The recent catastrophic floods in Queensland and New South Wales—and their impact on vulnerable people—have been devastating to watch unfold. Only after the water levels have receded can the true cost be established. An estimated 5000 new homes will be needed.
The federal government’s lacklustre approach to addressing the affordability crisis has focused on encouraging home ownership. A key program, released in the heady days of pandemic, was the $2.1 billion HomeBuilder scheme. As was raised by many at the time, it was likely to be funnelled to people not in need, who had already made the decision to renovate their homes. The policy has not only done this, but exacerbated skills shortages and heightened supply chain issues by stimulating significant demand.
For six glorious, halcyon days in late February this year, the community housing sector in Victoria was in a suspended state of disbelief. The announcement that the Victorian government would seek to create a Social and Affordable Housing Contribution levy to raise $800 million a year from approved property developments was lauded as the largest reform to social housing since the 1960s.
The Victorian government was prepared to lure the property industry with the opportunity of super profits through accelerated planning approvals. It was courageous and breathtaking public policy. And it succumbed soon after to the strong arm of the development industry, through intimidation ahead of an upcoming election.
The contribution would create a supply of 1700 units for people most in need, in perpetuity. The historic announcement was paired with freeing the community housing sector from the burden of local council rates, bringing it in line with the creation of other social infrastructure, such as public schools and hospitals.
To make it happen, the Victorian government was prepared to lure the property industry with the opportunity of super profits through accelerated planning approvals. It was courageous and breathtaking public policy. And it succumbed soon after to the strong arm of the development industry, through intimidation ahead of an upcoming election.
For our operation, a registered community housing provider and charity with DGR1 status, relief from council rates would have allowed us to employ two new housing workers on an ongoing basis.
Housing is a human right. For too many, it has become an investment vehicle.
The Productivity Commission tells us without the provision of Commonwealth Rent Assistance, 72.5 per cent of low income households would have experienced rental stress in June 2021. Rental stress is described as the payment of more than 30 per cent of income on housing.
This year, alarmingly, 45.7 per cent of CRA recipients are considered to be experiencing housing stress. And these figures likely undercount the already worsening situation and rising levels of homelessness.
So what is to be done? Let’s keep it simple.
1. Governments can take shared responsibility for the problem and develop a national housing plan. We’ve not had one in Australia since the end of the Second World War. The plan should develop clear boundaries around private wealth generation from property, roles and responsibilities of various tiers of government, as well as the provision of public goods.
2. Build more social housing. The current stock of social housing, currently around 430,000 units, has remained stagnant over the past 20 years. Meanwhile, Australia’s population has grown by 33 per cent. Much more housing is needed for those most in need.
3. Boost the JobSeeker rate and Commonwealth Rent Assistance. Individuals reliant on income support are at higher risk of becoming homeless. While the Age Pension, Parenting Payment, Carer Payment, and Disability Support Pension are indexed to wages, the JobSeeker payment is indexed to inflation. Until last year, the amount had not increased in real terms in more than 20 years.
4. Review and address distortionary and unfair tax breaks, such as negative gearing and capital gains, that allow people to use housing as an investment vehicle while demand for affordable housing is through the roof.
Only when governments start to take serious measures to calm the storm currently raging in our housing system will the threatening clouds of inequity start to dissipate.
Charlie Beckley is the CEO of South Port Community Housing Group.