Nick Champion (Wakefield, Australian Labor Party) Share this | Hansard source

I rise to support the National Rental Affordability Scheme Bill 2008 and the National Rental Affordability Scheme (Consequential Amendments) Bill 2008, and I note that housing is such a critical issue because homes are important. They are centres of life for many Australian families and if you do not have a home you are in pretty dire circumstances. That is why in the Rudd government there is the Minister for Housing, who should be commended for the work she is doing. That is why we made housing affordability a key issue in last year’s election and a key plank of our platform. That is why housing has always been one of the top things on Labor’s agenda. That is why this legislation is before the House today. We desperately want to deliver on our election promise to increase the supply of affordable rental housing.

The National Rental Affordability Scheme is a key part of our overall $2.2 billion affordable housing package. The package in total will increase the supply of affordable rental housing, help people save for their first home, lower housing infrastructure costs and also build new homes for the homeless. On the matter of the homeless, Adelaide is one of the few capital cities to reduce its level of homelessness over the last few years and the state government in particular is to be commended for that.

The Rudd government’s economic stimulus package includes initiatives to support homeownership and to keep our property market healthy and active. I especially support the increase in the first home buyers grant for the construction of a new home to $21,000. There are many new suburbs in my electorate; it is a destination for new homeowners. Places like Blakeview, Hewett and Andrews Farm are going to have significant growth over the next couple of years, and I think that in the next 10 years there is going to be phenomenal growth both in the northern suburbs of Adelaide and also around the regional centre—it is not really a town anymore—of Gawler. I think that we are right at ground zero in terms of the provision of new housing.

This legislation focuses on the rental market. There is an extraordinary amount of housing stress out there. It is particularly true in Wakefield, where some 41 per cent of people renting in the private market are suffering from stress. Most of those people are on very modest incomes and have to cut back on essentials and luxuries just to keep a roof over their head. I have been to many places where old Housing Trust places have been sold off to private owners and now the rents on those houses have risen extraordinarily. We have seen areas where there has been traditional public ownership and moderate rents catering for low-income earners, age pensioners and disability pensioners, and we have seen a shift to the private rental market and an increase in rents. Obviously they have increased faster often than people’s incomes have increased. They have risen faster and higher than the costs of living and they are increasing because there is a lack of supply of housing, particularly affordable housing. The Rudd government is tackling that issue head-on.

The National Rental Affordability Scheme demonstrates the benefits of cooperation between the Commonwealth and the states in this area and encourages large-scale investment in affordable rental housing by offering incentives to the providers of new dwellings on the condition that they are rented to low- and moderate-income households at 20 per cent below market rates. The incentive comprises a Commonwealth contribution of $6,000 per dwelling per year and a state or territory contribution in the form of either direct financial support or an in-kind contribution of $2,000 per dwelling per year. Obviously, this legislation provides for the Commonwealth incentives only.

The objective of these incentives is to create 50,000 more rental properties across Australia over the next four years specifically catering for those on low and moderate incomes. Looking to the future, if market demand remains strong the Rudd government can commit to making a further 50,000 incentives available from July 2012 to help build more affordable rental properties, and we hope that we are around to honour that commitment. These incentives could potentially leverage up to $13 billion in private investment and they represent an excellent opportunity for government, businesses, financial institutions and community housing to work together to really solve this problem. In my discussions with people in community housing, I find they have the expertise to provide housing; they often just do not have the capital, and I think that that is one of the big issues.

Another point that should be taken into account is that these families do pay their rent on time. Perhaps because they are so close to the margins of poverty they do value having a home, so generally they pay their rent on time every week. They know that they walk a tightrope.

Rental stress more often affects low-income families, pensioners and young people, and as rents rise fewer young families are able to make the transition from renting to saving up a deposit to buy a house in the great Australian tradition. People increasingly cannot afford to own a house and that is putting more and more stress on the rental market. To support these families and to ensure that the support is going to those who need it, we will have an eligibility test in place.

In Wakefield up to 7,000 families could be eligible under the current draft of the regulations and based on the income thresholds. Of course, many of those families already own their own homes or rent private dwellings and may not apply. For those that do, the regulations reflect good common sense. For families that come in under the income thresholds—currently proposed at $55,991 for couples with no dependent children and $69,423 for couples or sole parents with two children—there are provisions to allow for an increase in income by up to 25 per cent before families will be given a year to find other accommodation. This ensures that rental supply is being made available to those who need it but it gives some security of tenure to those people who do get it and whose circumstances change.

The scheme is governed by regulation rather than by specific provisions in a bill, because it is vital that the government be able to be responsive to movements in the property and rental market and flexible regarding the specific rules related to this scheme to make sure it has maximum impact. An example of this flexibility is the important fact that the legislation and the regulations will allow for eligibility under the scheme to be recognised retrospectively from 1 July 2008. This means that incentives will be in place immediately and, hopefully, we can get the ball rolling.

This scheme represents real leadership by the Rudd government on the issues that have been hurting working Australians for a long time. For too long the previous government did nothing—nothing was done to address the problem of spiralling rents and the lack of supply of low-income housing in particular. You could see this crisis coming a long way off. I remember when I was looking for a rental property in the northern suburbs about three or four years ago—I now own a place; I was renting at the time. I was on a good income but I had real trouble finding a decent rental property. That was a bit of a warning sign even then. You would see the same families going from inspection to inspection of rental properties. It was really quite extraordinary. That was a bit of a signal even four or five years ago. You could see this crisis coming. Unfortunately, the previous government did not act. It did not have a housing minister and really left it to the private market to provide these rental properties. Of course, what we have found is that the private market has not effectively catered for them.

We now have direct and effective action from the government, incorporating the private sector. This plan will provide the incentives for 50,000 new, affordable rental properties for low-income earners. This legislation means that young families will be able to find safe, secure and affordable rental accommodation. This means more young people and students will be able to make the transition to living away from home. This means more pensioners and working people—cleaners, nurses and retail workers—will be able to get out of rent stress and will be able to start saving, investing or spending some of their budgets on other necessities, just getting by. With this legislation we deliver yet another piece of ambitious reform, in this case to the rental market. We deliver on our commitment to the Australian people to address this issue and the rent stress crisis. I commend these bills to the House.

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