Housing fund proposal ‘modest’ but can be scaled up

Key Senate crossbenchers and independents are demanding more ambition from the Federal Government to tackle Australia’s housing crisis.

A battle looms in the chamber over Labor’s signature housing future fund.

The $10 billion proposal passed the lower house in February but faces a challenge in the Senate as the Greens and independents worry it doesn’t go far enough.

Speaking ahead of a parliamentary committee to examine plans for the fund’s implementation, independent senator David Pocock said the allocated money – which will finance 30,000 social and affordable homes in the first five years – is “not going to even touch the sides.”

The senator for the ACT said there were 3100 people on his jurisdiction’s social housing waiting list but the Housing Australia Future Fund, or HAFF, was on track to provide just 540 homes.

“It sounds like a lot of money but when you break that down into available payments to build and maintain social homes, that money runs out pretty quickly,” he said.

The Greens – whose vote the Government will require to pass the bill – are calling for a minimum $5 billion to be invested every year and the removal of a $500 million annual spending cap.

Senator Pocock and Greens senator Nick McKim joined other committee members to quiz experts about the proposed legislation on Wednesday.

Representatives from the community housing sector welcomed the package as a step towards a more reliable source of funding.

Community Housing Industry Association chief executive officer Wendy Hayhurst recommended some tweaks but suggested the fund could be easily upscaled.

“While the initial housing targets are modest, the HAFF can be scaled over time with regular top ups and this could become the source of ongoing dependable funding needed to make inroads into the shortfalls in social affordable rental housing,” she said.

In a submission to the committee, the National Aboriginal and Torres Strait Islander Housing Association called on the Government to clarify the rationale behind the $500 million annual limit.

It noted the first review of the annual spend won’t be until December 2028 and called for this to be brought forward along with additional reviews every three years.

Representatives from the property industry also called for more ambition to ease housing shortages, with the Property Council of Australia calling for the future fund to be doubled.

In its submission, the PCA also called for a commitment from all levels of government to redirect one per cent of development taxes and charges to social and affordable housing.

Cameron Murray, a research fellow in the Henry Halloran Trust at the University of Sydney, said the future fund would be better off investing directly into Australian housing instead of financial assets.

“This fund has been portrayed as a low-risk long term politically insulated funding source,” he said.

“It is exactly the opposite, it is a high-risk fund that defers tough housing spending decisions to future politicians who now have an excuse to limit housing funding to $500 million.”

– BY AAP