Out of touch’: Labor slams government for ignoring surging cost of rents

New Daily.
Nov 28 2021

Renters have seen the cost of keeping a roof over their heads skyrocket over the past year, making it harder to get ahead when wages have flatlined.

Labor’s housing spokesman Jason Clare says this is the biggest bill that millions of Australians pay every week and many are struggling to keep up.

“The fact that Scott Morrison says this isn’t a problem shows just how out of touch he is,” Mr Clare said in a statement on Sunday.

“He needs to get out of The Lodge and into the real world.”

He said while rent has skyrocketed across most of the country, in regional Australia it is through the roof.

Steep increases 
For example, in Kensington, Western Australia, median priced rents have gone up 27.9 per cent, a $6240 increase over the year.

Likewise, in Byron Bay NSW, rents have increased 26.7 per cent for a median priced rent, to be up $10,400 on the year, while in Darwin they are up 25.3 per cent or $6500 annually.

“From childcare and petrol to out of pocket health costs and rent, families know that it’s harder to get ahead under the Morrison government,” Mr Clare said.   

Labor has pledged to establish a Housing Australia Future Fund in government which will build 30,000 social and affordable homes across the country over five years.

This includes 20,000 new social housing properties, 4000 of them for women and children fleeing domestic and family violence and older women on low incomes at risk of homelessness.

There are also 10,000 affordable homes for the “heroes of the pandemic” – frontline workers like police, nurses and cleaners who have kept Australia safe during the COVID pandemic.

Everything is more expensive under this Liberal government.

Let's see now . . . thats rents, price eggs, petrol, antagonising our friends in China and France, Global Warming, blah, blah, blah. Super Albo will save the day!

issuevoter wrote on Nov 29^th, 2021 at 9:12am:

Let's see now . . . thats rents, price eggs, petrol, antagonising our friends in China and France, Global Warming, blah, blah, blah. Super Albo will save the day!

Glad you've seen the light

whiteknight wrote on Nov 29^th, 2021 at 5:22am:

For example, in Kensington, Western Australia, median priced rents have gone up 27.9 per cent, a $6240 increase over the year.

could you imagine the hysteria from this govt. if the workers of Kensington asked for a 27.9% increase in their pay  :D :D :D

‘Australia has a housing crisis’: Govt urged to set up social housing future fund
Nov 28 2021 New Daily.
The federal government is being urged to set up a national investment fund to generate the money needed to build an extra 3000 units of social housing every year.

The plan, put forward by independent think tank the Grattan Institute, would see the federal government issue $20 billion in bonds and invest the money into a new fund called the Social Housing Future Fund.

Managed by the Future Fund Board of Guardians chaired by former treasurer Peter Costello, the fund would invest the $20 billion in financial markets and use any above-inflation returns to provide grants to state governments and community housing providers to build social housing.

Social housing typically caps rents at 25 per cent of tenants’ income and has been shown to reduce the risk of homelessness.

The Grattan Institute estimates an initial endowment of $20 billion could deliver an extra 3000 social housing units a year in perpetuity – or 6000 units a year if state governments were required to match federal contributions – provided the future fund achieves an average annual return of 4 to 5 per cent.


Under Grattan’s plan, the government could build 54,000 extra social homes by 2040 at a cost of $400 million a year.
Assuming the government would have to pay investors interest of 2 per cent a year on its bonds, building an extra 3000 social homes a year would cost the federal government $400 million a year in debt-servicing costs – the equivalent of less than 0.1 per cent of annual federal government spending.

But that cost could be reduced to zero, if the federal government used some of the returns from the Social Housing Future Fund to cover the cost of the interest owed on its bonds.

“If you use some of the returns to cover the debt servicing costs, then you can build 1700 homes a year for no hit to the underlying cash balance (federal budget),” said Brendan Coates, director of the Economic Policy Program at the Grattan Institute.

An extra 6000 units a year are needed to give people the same opportunity to access social housing in the future as they had in the past.

In recent years, state governments have built 2000-3000 units per year.

‘Australia has a housing crisis’
In his analysis paper released on Sunday, Mr Coates said there was a need for greater investment in social housing as the number of social housing units in Australia had barely changed over the past 20 years, despite the national population increasing by 33 per cent in that time.

Mr Coates said “Australia has a housing crisis” and “poorer people are feeling the pinch most”.   

“Many low-income renters are living in poverty, and many more are suffering financial stress,” he said.

“Inequality is increasing, and more Australians are becoming homeless.”


Social housing units account for less than 4 per cent of Australian dwellings.
Mr Coates told The New Daily the Grattan Institute pitched its idea for a Social Housing Future Fund to Labor and the Coalition before the federal budget in May.

Labor leader Anthony Albanese then announced a similar policy in his budget reply speech.

The policy called for an off-budget ‘Housing Australia Future Fund’ to be managed by the Future Fund board of guardians.

But Labor committed $10 billion rather than $20 billion, and said it would deliver 4000 social housing units a year over the first five compared to the Grattan Institute’s promise of 3000 a year.

That Labor promised more units over the first five years despite having a smaller endowment suggests it would use a slightly different funding arrangement that would allow it to bring forward construction.



Economists back social housing
Grattan’s analysis paper comes after the nation’s top economists called for greater investment in social housing to support the economic recovery from COVID-19.

In September 2020, 55 per cent of Australia’s 49 leading economists told The Conversation that social housing would provide the biggest bang for the taxpayer’s buck when it came to boosting the economy over the following two years.

But the federal government offered no direct support for social housing in either of its past two budgets.

Angela Jackson, lead economist at Equity Economics, told The New Daily there was “no doubt we need more social and affordable housing in Australia – and that is going to involve greater investment”.

“How government funds that – and whether it uses a mechanism of a future fund, or funds it directly off the budget, or it looks at some joint initiatives with the private sector – they’re all things that need to be explored,” Dr Jackson said.

“Fresh ideas are good. But it doesn’t get away from the fact that what we need is government to see that it has a critical role in providing stable housing to those Australians who are struggling.”

Sorry, whiteknight, but when it comes to social housing these days all you're likely to see is all talk and no action. Been that way for years.

The Federal Coalition has already ignored suggestions a few months back to fund more social housing as a way of boosting jobs and the economy after the downturn caused by Covid.

And, under the 'doctrine' of Neoliberalism practised by all governments here in Australia for the past 40 years or so social (public) housing has been 'transformed' from an affordable and acceptable means of having a roof over peoples' heads (especially for migrants arriving here after WW2 who needed to be able to settle into a new home and set themselves up in jobs, etc.) to a 'last resort' means of housing for people on welfare or low incomes with the 'stigma' that's attached to it today.

The social housing stock Australia wide has been (and continues to be) sold off by State governments especially the ones that have been neglected maintenance wise - which is the majority of them - for decades with no or very few replacements being built.

Voting Labor or Liberal in Federal and State elections also won't change anything because both parties have been doing the same thing with social housing for decades and will no doubt continue to do so since they don't want to spend money on buying or building new housing or on maintenance and they get millions from selling off the current stock.

Carl D wrote on Nov 30^th, 2021 at 7:28am:

Sorry, whiteknight, but when it comes to social housing these days all you're likely to see is all talk and no action. Been that way for years.

Past performance is no guarantee of future performance. In this case, a change of federal government may be enough to put the construction of additional social housing on the political agenda.

The idea of a future fund to cover the cost of building social housing has been an idea I have seen a couple of times lately, most recently as a policy of the Labor party.

Housing Australia Future Fund - alp.org.au

My only quibble with this policy is that it has an endowment of $10 billion. I think it needs to be more, perhaps $20 billion.

Kensington is an inner city suburb adjacent to South Perth - Rich area and Vic park - Nouveau riche area.

But maybe we should get developers to build more rental stock. Claim tax deductions on the rent. Nah labor don't like that either. ;)

John Smith wrote on Nov 29^th, 2021 at 6:02pm:

whiteknight wrote on Nov 29th, 2021 at 5:22am: For example, in Kensington, Western Australia, median priced rents have gone up 27.9 per cent, a $6240 increase over the year. could you imagine the hysteria from this govt. if the workers of Kensington asked for a 27.9% increase in their pay  :D :D :D

20 to 30 percent rise  is about right all over WA. And Kensington is not a regional area, I dont know which idiot wrote that article, my other point would be that rents were pretty low in Perth to start with so a lot of these rises are just catch up. You can still rent a 4 x2 in a decent area  within 20 mins of the city over here for   500 to 600 a week , thats nothing compared to Sydney or Melbourne.