Carol Brown (Tasmania, Australian Labor Party) Share this | Hansard source

I seek leave to incorporate my speech and speeches by Senators Sterle, Xenophon and Wortley.

Leave granted.

The incorporated speech read as follows—

I rise to speak on the National Rental Affordability Scheme Bill 2008. This bill gives legislative effect to the Government’s National Rental Affordability Scheme, announced as part of the Government’s $2.2 billion affordable housing package in this years May budget.

The Scheme represents a bold and innovative commitment by the Government to increase the availability of affordable housing around the country and reduce the number of Australians suffering from rental stress.

Indeed the measures contained in this bill, along with several others previously announced make good on the Government pre-election commitment to tackle housing affordability in Australia.

In recent times the Government has also launched the first expressions of interest round for the $512 million Housing Affordability Fund.

It has passed legislation giving effect to the $1.2 billion First Home Saver Account initiative- enabling banks to offer such accounts to aspiring first home buyers. On top of this the Government has also announced a boost to the first home owner’s grant- from $7.000 to $14,000 for existing dwellings and to $21,000 for newly built homes, as part of its $10.4 million economic stimulus package.

Finally it has also began the process of rolling out projects under its Place to Call Home initiative, including I am proud to say in my home state of Tasmania, delivering on its dual commitment to tackle homelessness.

These represent the actions of a Government committed to assisting all Australians find the housing solutions that they need -the actions of a government which has made housing a key element of its broader social and economic policy agenda.

Indeed the Government recognises that finding viable and affordable housing solutions is causing a problem for many Australians.

It also recognises that investing in affordable housing infrastructure will not only ease the burden on people seeking affordable housing options solutions, by increasing the number of affordable houses available, it also makes good economic sense, through stimulating greater infrastructure production and investment.

The bill provides the principle legislation for the establishment of the National Rental Affordability Scheme. The Scheme will be established by regulations. It is desirable for most of the administrative detail of the scheme to be in regulations rather than a bill, to ensure the flexibility to address, if need be, the changing circumstances and conditions in the rental market.

The object of the bill, as stated, is to increase the supply of affordable rental housing and to reduce rentals costs for low to middle income families. The scheme encourages large-scale investment in affordable rental housing by offering an incentive to investors providing of new housing, on the condition that they rent them to low and moderate income families at 20 per cent below the market rates.

The incentive comprises of a commonwealth contribution of $6,000 per house per year, and a state and territory contribution in the form of direct financial support or an in kind contribution to the value of $2,000 per dwelling per year.

The incentive can be in the form of either a refundable tax offset or payment.

The incentive will be provided each year for 10 years and will be indexed in line with the rental component of the Consumer Price Index.

Importantly, the scheme will be reviewed in its early years of implementation to ensure that it is adequately focused on and delivering for those Australians who would otherwise be in rental stress, and to make sure the scheme that it remains simple and its administrative costs are minimal.

As the Minister for Housing, pointed out in her second reading contribution, the scheme represents the first major housing intervention by Government in over a decade. If supported and passed, it will be the first time in a decade that the Australian Government has engaged in the housing market and sought to actively foster the development of affordable housing solutions for low to moderate income families, who have up until this point been faced with a crucial lack of supply.

The Scheme contained in this bill will see the establishment of an additional 50,000 affordable rental property by 2012. Further if the demand for affordable housing remains high the Government is committed to looking at extending the scheme to include a further 50,000 incentives over the following five years.

This I am sure will come as a welcome relief for low income families, pensioners, young people and many workers who are struggling to find affordable housing and keep up with the cost of rent, and who I might add, where offered little assistance by the previous Government.

Statistics proved by the Australian Bureau of Statistics show that nearly 30 per cent of Australian households rent. Further that between 1996 - 2006, the number of people renting in Australia increased.

While families may choose to rent for a variety of reasons, figures show that renters are more likely to be younger and have a lower income.

Indeed, research produced by the National Centre of Social and Economic Modelling (NATSEM) supports this. It found that as of December last year a staggering 1.1 million low to moderate income families where suffering from rental stress right across the country. Nearly 700,000 of these families are currently spending more than 30 per cent of their incomes just on paying rent.

For those 700,000 thousand, that leaves significantly less to budget for other essential household expenses such as groceries, petrol, and childcare and education fees.

On top of this the current undersupply of affordable housing has pushed vacancy rates to a critical low, and with increased demand inevitably comes an increase price that can be charged for rent.

The practical reality of the decline in availability and increase in cost of housing in Australia means that many people are being forced to move, to live in cramped and less than desirable conditions, go without essentials such as food, just to pay the rent.

An unacceptable number are even being forced into homelessness.

Indeed the practical reality associated with increased housing costs in Australia, is that it is having an enormous impact on families, pensioners, young people and lower paid workers. Many are going without food, heating, proper health care because when it comes to the crunch, they are being forced to spread themselves too thin.

The Rudd Government recognises that something needs to be done to ease the burden on Australian households by increasing the availability of affordable housing, and by coming up with adequate housing solutions for all Australians.

It recognised this way back in July last year when the Prime Minister Kevin Rudd, then in opposition put the issue squarely on the agenda by hosting a Housing Affordability Summit to discuss the issue and come up with viable, long term solutions.

Since then the Government has kept to its word by delivering 2.2 billion worth of housing initiatives as part of this years budget, hosting a national forum on homelessness, delivering a green paper on homelessness, Which Way Home? A new approach to homelessness.

The Government’s Budget housing package involves a $2.2 billion investment over the next four years on boosting rental stocks, helping people save for their first home, lowering housing construction costs and building new homes for the homeless.

Alongside the 622.6 million set aside to establish the National Rental Affordability Scheme over the next four years, the Government has already begun the process of rolling out its First Home Saver Housing Affordability Fund and Homelessness initiates.

On October 1 banks around the country began offering First Home Saver Accounts.

Under this initiative the Government is investing around 1.2 billion over four years to help young Australians realise their dream of owning their first home by giving first home savers, with accounts up to $850 dollars for every 5,000 they save each year.

On top of this, as a mentioned earlier in light of the current global economic conditions we have, as part of our Economic Security Strategy, the Government has also doubled the first home owners grant from 7,000 to 14,000 for people who purchase established homes and to 21,000 for people who purchase a newly constructed home.

With ABS figures showing that younger people on lower incomes are most likely to be stuck in the rental market, these incentives are design to support and encourage people to save for their first home.

As part of this years budget the Government also announced a $512 million Housing Affordability fund to assist in the construction of new homes, making more affordable dwellings for those who need them.

This $512 million investment over 5 years is designed to provide a partnership with Governments and others across Australia to bring down infrastructure and holding costs for a new house in a new housing development across the nation.

In my home state of Tasmania where affordable housing is such a critical issue the launch of the Housing Affordability Fund has been met with strong praise from, the then State Minister for Housing, the Hon Lara Giddings.

As I have mentioned previously, the Tasmanian State Government has already established a new Housing Innovations Unit to work with local councils and other stakeholders to investigate areas of Crown Land which may be available to utilise the Housing Affordability Fund, I am confident the State Governments Housing Innovation Unit and the Federal Governments Housing Affordability Fund will together be able to provide Tasmanians with more affordable housing.

Application guidelines for the Affordability Fund were recently announced by Minister Plibersek and the Prime Minster.

The first round expressions of interest in our $512 million Housing Affordability Fund closed on the 15 October, with successful applicants being notified in December. The HAF will assist in the construction costs of new homes, making more affordable dwellings available for those who need them.

Finally, in light of the Governments commitment to provide better, more affordable housing for all Australians, it has committed to investing $100 million over the next four years, and another $50 million in 2012/13 to build 600 new homes for the homeless.

The A Place to Call Home scheme is a down payment on the Rudd Labor Governments commitment to reduce homelessness.

I am pleased to say, one of the first announcements made as part of the Scheme took place in my home state of Tasmania, consisting of a $20 million joint announcement between the Commonwealth and State Governments to help build a new supported accommodation facility for Tasmania’s homeless.

When combined with the measures contained in this bill, all of these measures add up to a substantial commitment by the Government to do all it can to address housing affordability in this country.

Each of the initiatives have specific benefits and have been the subject of praise, and the National Rental Affordability Scheme is no exception.

When the Scheme was first announced, last year, it was welcomed by the Housing Industry Association director, Dr Ron Silberberg, who said that the scheme was and I quote “… a very positive step as it provides incentive for investment..” and that the design of the scheme ensured that investment would be targeted where it was most needed.

Indeed, an increasingly important point to make is that in economically turbulent times, the Scheme will provide a solid incentive and surety for investors to continue to build new affordable housing options.

Further in such circumstances the scheme will help facilitate new and creative partnerships to emerge between with state governments, local councils, not for profit organisations, investors, developers and community houses to adequately address the supply of affordable housing and target it directly to the areas that need it most.

This can only be viewed as a positive thing.

The Senate Select Committee Inquiry into Affordable Housing recently handed down its report. In relation to rental schemes the Committee found, and I quote:

“… That the current supply of rental housing is severely inadequate. Vacancy rates are at record lows. The committee acknowledges the federal governments National Rental Affordability Scheme and its national target of an extra 100,000 affordable housing dwellings with 50, 000 by 2012. The Scheme will provide annual tax incentives over 10 years to investors in affordable rental housing.”

The operation of the Scheme has also been recently considered by the Senate Community Affairs Committee. Indeed the Committee’s report was handed down ahead of schedule.

The Report notes that he National Rental Affordability Scheme attracted strong support from a wide variety of submitters. However that the major reason for the widespread support for the scheme was the significant undersupply of affordable rental housing options for those on low incomes.

Indeed the submission from the Department of Families, Housing, Community Services and Indigenous Affairs, concluded at the unmet demand in the construction of housing is currently running at around 30,000 dwellings per annum.

Further and most importantly the Committee noted in the report that it was left with little doubt that the parts of the housing sector that concern itself with low to moderate income earners considered the passing of this bill as a matter of public urgency.

The report noted that the primary concern regarding the scheme was that participation in the scheme may potentially impact on an organisations charitable status.

The Government has already sort to address this, with the Treasurer announcing on the 12 November an extension of the relevant act so as to circumvent this possible situation occurring.

Indeed the committee anticipated that this amendment would address the primary concerns raised by witnesses in relation to the potential loss of charitable status and would provide the necessary certainty for investment in the scheme to commence.

In response to these concerns the Treasurer also announced yesterday that the Government would introduce a transitional safety net for charities looking at participating in the scheme.

This has left no doubt that charity organisations will be able to participate in the scheme with the confidence that their charitable status will not be jeopardised in anyway.

The Committee concluded that while the Scheme was not likely to address in full the current shortfall of affordable rental housing for low to moderate income earners, and a medium to long term approach to the issue was needed, the scheme would serve the purpose of effectively and efficiently supplementing the supply of affordable housing stocks in Australia. Further that any concerns raised during the course of the inquiry could be adequately addressed in the post- implementation of the scheme and did not warrant the further delay of the introduction of the Scheme.

Therefore the Committee recommended that the Senate pass the bill.

Indeed in light of the plethora of evidence which demonstrates the harsh reality of the current significant undersupply of affordable rental housing in Australia is that an increasing number of Australian families are suffering from housing stress and in extreme cases left with no where to live, the measures contained in this bill are most timely and most welcome.

I commend the bill to the chamber and support its passage.