If there was any doubt the Liberal Party has nothing but disdain for social and affordable housing, it was removed in the fine print of Peter Dutton’s Tuesday promise of tax cuts for the better paid. Michael Pascoe reports.
How does Peter Dutton propose to pay for tax cuts for his “aspirational” voters? In part, it’s by scrapping the only major effort to increase the stock of social and affordable housing since the GFC. And this with the nation suffering a desperate shortage of shelter for people priced out of the private rental market.
It’s no secret that the Federal Liberal Party doesn’t like social housing or, it seems, the people who live in it. Odds are they don’t vote Liberal. Cue the dumped member for Mackellar, Jason Falinski, with his on-the-record dissing of “housos” and dedication to leaving the provision of housing to developers.
Now, Peter Dutton is making it part of his election platform to scrap Labor’s Housing Australia Future Fund (HAFF), the $10B program tasked with building 30,000 social and affordable dwellings over the next five years.
HAFF to be gone
I have reservations about the HAFF. I’d prefer the money – and much more money – to be spent directly by government building social housing, as was done very successfully as part of a less-remembered GFC stimulus initiative.
Instead, the Albanese Government’s housing centrepiece provides an ongoing annual $500m subsidy for community housing bodies to build and operate the new homes, a mix of social, affordable and emergency dwellings.
Dutton wants none of it. In gifting the Australian Financial Review’s Phillip Coorey an early look ($) at the Liberal’s alleged election economic policy, Dutton signalled the end of the HAFF.
Reports Coorey: “The Coalition will fund its promised tax cuts for ‘aspirational’ voters using a war chest amassed from scrapping a raft of Labor policies, ranging from production tax credits to interest payments on almost $50B in off-budget funds, to Fringe Benefits Tax exemptions on electric cars.”
That sounds like the standard Coalition political mantra of promising tax cuts and smaller government. The Mandy Rice-Davies rule applies, “he would say that”.
The quality of the policy is demonstrated by money for promised tax cuts being delivered by magic: “The plans also includes (sic) saving billions by lowering inflation and consequently the rate by which pensions and welfare payments are automatically indexed,” reports the AFR with the print equivalent of a straight face.
Yes, folks, Peter Dutton thinks he has the magic power to set the level of inflation. The Reserve Bank will be delighted.
(You can make up stuff like that while in opposition and rely on most media letting it go by.)
From Main Street to Wall Street: is the HAFF housing scheme a gift to the money men?
Budget funding
A less fanciful source of funds was faithfully reported as: “Should it win the election, the Coalition will fund its tax cuts using money dedicated to Labor policies its (sic) opposes. These include, but are not limited to, the production tax credits for green hydrogen and critical minerals which will cost a collective $13.7 billion over the next decade and then another $14.1 billion to 2041 when they expire.
“They have also earmarked the FBT exemption on electric cars and the billions in debt interest payments that will accrue from such funds as the $10 billion Housing Australia Future Fund, the $20 billion Rewiring the Nation Fund, and the $15 billion National Reconstruction Fund.”
(No mention of the $20B Medical Research Future Fund the others were modelled on, but that was an Abbott Government initiative.)
It is euphemistic reporting to say the money will come from saved interest payments on the borrowed funds that established the funds. What it means is scrapping the funds.
No HAFF, no 30,000 social, affordable and emergency homes.
This should not be a surprise. The Federal Liberal Party’s interest in housing is limited to more of the same disastrous policies that have landed us in the unsustainable mess we’re in – relying on skewed tax policies and “the market” to provide shelter at a profit for those who can afford to own and too bad about the rest beyond their role in providing profit for landlords.
Anti-housing “coalition”
The opportunistic coalition the Liberals have formed with the Greens in the Senate has opposed every housing initiative attempted by Labor. The Greens have done so for political advantage in attempting (with some success) to extort more money for social and community housing. The Coalition has done it because it despises housos and wants to continue to increase the inequality that comes from our failed housing market.
The LNP has no policy to increase supply, only to increase demand by allowing the fortunate few with a spare $50,000 in their superannuation fund to use that to bid more for a first home. It’s the same policy folly as the various First Home Owner grants regularly dished out ahead of elections.
Policies to increase buying power are bad overall unless they are more than matched by policies to increase supply. Otherwise, they just further inflate inflated prices.
I’ve argued elsewhere that Labor’s housing policies are not enough to solve our crisis, only to preserve the status quo.
A worsening housing crisis
The LNP’s plans will worsen the crisis, further shrinking the proportion of social housing in our national stock, making it even less available for those in need, continuing to effectively subsidise private landlords through burgeoning Commonwealth Rent Assistance, ensuring the most vulnerable and desperate Australians are left to battle the uncertainties and inadequacies of the bottom end of the private rental market – a place I wouldn’t want my dog to be if he was still alive.
More than 60 per cent of public housing tenants – the ones lucky enough to actually score proper shelter are women. I guess the LNP doesn’t care much about them and even less about the hundreds of thousands on waiting lists.
Developers Rule: affordable housing turns out to be unaffordable.
Michael Pascoe is an independent journalist and commentator with five decades of experience here and abroad in print, broadcast and online journalism. His book, The Summertime of Our Dreams, is published by Ultimo Press.