With regret, the Labor Members of the Committee do not support this report. We had hoped that this inquiry would begin to address the structural issues in the housing market and begin the path to more affordable housing for the many. Unfortunately, it falls well short and with few exceptions, largely recommends business as usual.
The Labor Members note that the report does not set the big picture or attempt to define what success in housing policy might look like or answer the basic questions of ‘affordability for whom’, or whether the market is delivering the range of housing that people want, or even define the extent of the crisis. Several witnesses attempted to define reasonable outcomes – for example, that a person on the median wage should be able to afford the median priced home, others reflected on whether the range of housing options was broad enough to meet latent demand.
The report fails to set the frame through which the Committee measured desired overall outcomes.
In part, the report fails because the Chair’s focus was, and remains on supply – a pre-conceived view that prevailed. There was little acknowledgement of the complexities in the market, well documented by many submissions and largely ignored or openly rejected in ‘Committee Comment’.
While evidence was presented that challenged the assumption that increasing supply would solve all, most evidence was ignored or rejected. Evidence was presented that covered: the lag in supply relative to demand; the supply chain and labour shortage issues that risk increasing costs as supply increases; how natural disasters in one location increase costs elsewhere; and that the building of social housing can compete for labour or supplies with commercial builds. The report does not address the impact of changing climate on existing housing and how that will impact both supply and demand.
One of the reasons for the narrow focus of this report was the timeframes for the inquiry. For an issue this complex and important, it was unreasonably short. Time pressures for the Secretariat and the Committee meant that the Chair made decisions that important issues – like affordable housing, social housing, homelessness, mortgage stress and rental stress were largely sidelined as was shocking evidence on the growing proportion of the population that could not afford commercial rent.
The Committee Chair decided that the report would focus primarily on ‘market housing’ with ‘non-market’ housing for the growing number of ‘individuals and families who are unable to fully afford market prices’ relegated to a single chapter. That chapter was strongly influenced by the blanket statement that ‘the Government should avoid being one’s landlord’.
The short timeframe meant that many important views were not considered. State Governments were largely absent from the witness list – with only Queensland appearing.
Given that the historical approach to regulation, planning, funding etc. has led to a spaghetti bowl of costs, taxes, rental subsidies, regulatory delays, and planning failure, shared across three levels of Government in a system which is arguably not fit for purpose now, that is a major flaw.
Most recommendations are for tweaking the status quo. Those that do recommend something new are poorly thought through and badly explained.
Yet we have a housing crisis in Australia. It’s harder to buy than ever before, it’s harder to rent than ever before and there are more Australians experiencing homelessness than ever before.
The National Housing Finance and Investment Corporation’s (NHFIC) recently released State of the Nation 2021-22 Report has revealed that “affordability for renters and first home buyers deteriorated across most cities and regions in 2021”.
The State of the Nation Report also revealed that the housing crisis is hitting regional Australia the hardest. Regional dwelling prices grew an average of 26 per cent, significantly more than capital cities which grew 21 per cent.
There is no simple or single solution to address housing affordability. But it does require leadership from the Federal Government.
This includes the development and implementation of a National Housing and Homelessness Plan – with real, hard engagement with States and Councils. Housing industry experts have been calling for this for years, but the Government has refused to act, repeating, as this report does, that this is the responsibility of state and territory governments.
In March 2021, at the Australian Labor Party Special Platform Conference, Labor committed to working with the state and territory governments, local government and experts in the housing sector to develop and implement a National Housing and Homelessness Plan in government.
Improvements in land use planning and land supply are important and have the potential to improve housing affordability and provide a boost to national productivity and economic growth.
To support these improvements, Labor acknowledges the need for closer collaboration between federal, state and territory governments and the need to improve the quality and consistency of housing data. The NHFIC State of the Nation Report highlights that consistently measured, detailed and publicly available data on land supply is extremely limited and new initiatives should improve this situation.
Labor Members note that many of the recommendations of this report are ill-conceived, disorganised and largely driven by the opinions of the Committee Chair rather than considering the evidence provided by expert witnesses.
Labor notes that Recommendation 4 recommends that the Morrison Government adopt the recommendations of the House of Representatives Standing Committee on Social Policy and Legal Affairs’ Final Report – Inquiry into homelessness, which included a recommendation that the Federal Government develop and implement a ten-year national strategy on homelessness.
On 17 February 2022 the Morrison Government tabled its response to the Inquiry into Homelessness in Australia concluding that it would not support this, or the majority of the 35 recommendations made by the Committee in August 2021.
Labor Members further note that the Committee also received evidence about the need to increase investment in social and affordable housing and concerns that the availability of social and affordable housing has not kept up with demand.
The Morrison Government refuses to show leadership and take responsibility for increasing investment in social and affordable housing.
In contrast, during the Opposition Leader’s Budget-in-Reply speech in May 2021, Labor announced that a future Albanese Labor Government will create a $10 billion off-budget Housing Australia Future Fund to build social and affordable housing.
Over the first 5 years the investment returns will build around 20,000 social housing properties. Four thousand of the 20,000 social housing properties will be allocated for women and children fleeing family and domestic violence and older women on low incomes who are at risk of homelessness.
Over the first 5 years 10,000 affordable housing properties will also be for frontline workers.
In addition to this, a portion of the investment returns will be available to fund acute housing needs in perpetuity. This funding will be used for additional crisis, transitional and long-term social housing in parts of the country with the greatest need.
In the first 5 years these investment returns will:
invest $200 million for the repair, maintenance, and improvement of housing in remote Indigenous communities.
invest $100 million for crisis and transitional housing options for women and children fleeing family and domestic violence and older women on low incomes who are at risk of homelessness.
invest $30 million to build more housing and fund specialist services for veterans who are experiencing homelessness or at-risk homelessness.
Finally, Labor members note that the standards that usually apply to Reports of Parliamentary Committees have not been met. The report includes statement of opinion in sections that traditionally present evidence. The separation between evidence and Committee Comment is not clear. There are statements that refer to practices overseas that are not referenced. There are recommendations that do not draw on any of the evidence taken. There are some extraordinary statements that reject outright the evidence submitted by experienced and reputable practitioners. There are recommendations drafted by the Chair that are so badly worded as to have more than one meaning to an ordinary reader.
The standards in report writing are important, in that they ensure that readers will have a common understanding of the intent of the Committee in pursuing an agenda. In the world of governance, that matters, as people consider future options and make decisions based on the words of Parliamentary Committees.
Ms Julie Owens MPMs Ged Kearney MP
Deputy ChairMember
Hon Matt Thistlethwaite MP
Member