Murray Watt (Queensland, Australian Labor Party, Shadow Minister for Northern Australia) Share this | Link to this | Hansard source

At the very outset, I'd like to say that Labor supports the National Rental Affordability Scheme Amendment Bill 2019. In fact, the National Rental Affordability Scheme, or NRAS, as it's commonly known, is another proud achievement of previous Labor governments in the social policy and, particularly, housing space, because NRAS was actually set up by federal Labor when we were in government in 2008. Under the scheme, investors were provided with 10-year contracts through both state and federal funding, and rent was provided at 20 per cent below market rate to vulnerable Australians. Unfortunately, when the Abbott government came to power, they cut all new funding for the scheme and capped the scheme at 38,000 dwellings. They also didn't replace this scheme with anything else.

But, of course, as we all know, the housing affordability problem has not gone away over that period of time. In fact, homeownership rates are now at the lowest level we've seen in 50 years in this country. More Australians are behind in their mortgages than at any time since the global financial crisis. Rental stress is through the roof. More Australians are now homeless than ever before. This is a crisis that this government seems to be largely ignoring.

A report that came out last week from the Australian Institute of Health and Welfare shows that, over the last 10 years, we've lost more than 20,000 public housing units. Social housing construction hasn't kept pace with the growth in households. A quarter of the new public housing tenants in 2017-18 who were classified as 'in greatest need' had been on the waiting list for more than 12 months, and 13 per cent had been waiting longer than two years.

This bill makes a number of improvements to the existing NRAS that we on the Labor side support. In particular, it improves protections for tenants and investors. It ensures that any payments to investors are done in a timelier manner to ensure NRAS stock is not withdrawn from the scheme. It also removes ambiguity in relation to the calculation of below-market rents in any one year, and it provides flexibility in the way maximum periods of vacancy are prescribed.

This bill was examined by a parliamentary inquiry in the last parliament, and we are grateful that the government incorporated some of the Labor members' recommendations into this bill and also undertook to include the other recommendations in the new regulations when they are made. Labor has consulted with a number of stakeholders, including the National Affordable Housing Providers, the National Affordable Housing Consortium and the Community Housing Industry Association, who are supportive of this legislation. I hope, as they do, that as the government drafts the accompanying regulations the government engages in consultation with those who will continue to use the scheme.

Labor has moved an amendment to this legislation to ensure that the departmental secretary retains the ability to make new allocations under NRAS. Labor members believe this is a necessary amendment to ensure that this or a future government could extend NRAS funding and for the secretary to make new allocations should they so wish. I note that the government has indicated it will support this amendment, and we're grateful they've done so.

The government has decided to not allocate new funding to this scheme. Nothing in this act requires it to do so. However, it might change its mind, or a future government might wish to use this act to help build more affordable housing. Let's certainly hope so. Therefore it makes sense to leave this power to the departmental secretary in the act.

Let me reiterate: Labor supports this bill, and we commend our amendment to the Senate.

Mehreen Faruqi (NSW, Australian Greens) Share this | Link to this | Hansard source

I rise to speak to the National Rental Affordability Scheme Amendment Bill 2019 on behalf of the Greens. While the Greens will be supporting this bill, I want to make it very clear that this bill does not address the real issues of rental affordability and housing stress that the community is facing more and more every single day. We know that our housing system is completely broken. There are no ifs and buts about that whatsoever. For many years now we have gone from one news headline to another about the housing crisis, only to be met with lukewarm policy responses by the government. They do not have an agenda to reduce homelessness, to pull struggling people out of housing stress and to make housing fairer for all. The government's response to the very serious and very real housing crisis in Australia has come to resemble busy work, to give the illusion of doing something. This bill that we are debating right here is an example of that busy work.

The National Rental Affordability Scheme Amendment Bill 2019 makes certain amendments to clarify and flesh out the legal authority for the scheme contained in the NRAS regulations, but only until the scheme ceases operation in 2026-27. What happens to the rental affordability scheme after that? That's what we should be debating here today. Through this bill, the government is trying to take away the ability of the secretary to allocate new housing to this scheme. I understand that Labor plan to move an amendment to change that, and the Greens will be supporting that amendment. Properties that came to the scheme when NRAS was first introduced in 2008 are starting to fall off now, with people and families, especially those on low incomes, facing eviction and potentially homelessness. The government has not put a replacement scheme on the table. Where's that plan? There is no plan, because this government sees homelessness as a public relations problem rather than the crisis that it is. It was only this month that the new Assistant Minister for Community Housing, Homelessness and Community Services, Mr Luke Howarth, said that he wanted to put a positive spin on homelessness and housing stress. This is a government that would rather homeless people disappear at the snap of its fingers.

The community does have a message for the assistant minister and this government: homelessness is not a PR problem, and housing stress may not look good on their glossy pamphlets, but no spin doctor can help them hide the growing waiting lists for public housing in every single state and territory and the increasing number of people sleeping on footpaths and in alleyways. If the housing problem in this country makes them feel so uneasy then do something about it!

The fact that the minister thinks that the housing crisis needs a so-called positive spin and that it only affects a small number of people is extremely concerning. What about the more than 118,000 people who are homeless? The 140,000 people on public housing waiting lists? Or the more than one million Australians in housing stress? The 2016 census found that there was a 14 per cent increase in homelessness in the previous five years, with a staggeringly high jump of 30 per cent in my home state of New South Wales.

Instead of trying to spin their way out of the homelessness problem, the federal government must show leadership in tackling the housing crisis. And they can do this by making an unprecedented investment in public and community housing, and by getting rid of the unfair tax breaks that have gone to investors buying their fifth property over people looking for their first home. The commodification of housing is a huge problem. First home buyers compete with wealthy investors who benefit from these unfair tax breaks, resulting in over a million households paying more than they can afford on housing. So let's end negative gearing and phase out capital gains tax so we can have a fairer system for all, because everyone has the right to a safe, secure and permanent home.

The lack of affordable housing and rental stress are not happening in a vacuum. Private markets are dictating housing outcomes for Australians as our publicly owned housing stock has dwindled over time, with much of it being sold off by state governments. Public housing stock has been replaced by bandaid measures, with successive governments fiddling at the edges. With more and more people renting, and many people on low incomes living with rental stress, real rental assistance is absolutely crucial. With almost a third of Australians now renting, it is long overdue that their rights are considered a national issue by political parties.

Many countries, like Germany, have strong rental laws that ensure that people who rent can be guaranteed an affordable place to call home over the long term. Public housing lists have blown out in every single state and territory, yet the federal government sits on its hands. Governments of both stripes, actually, have failed to offer any long-term solutions. We need a national housing strategy that includes massive investment in public housing. We desperately need leadership from the federal government. Right now, 45,800 people are classified as being in greatest need of housing because they are homeless, their safety is at risk, or they have very high and unsustainable rental costs which mean that they are constantly faced with imminent homelessness. These are the most vulnerable people, and more and more Australians are being added to this most vulnerable list every single year.

People are living in poverty; people don't have a place to call home or a roof over their heads. The government won't increase Newstart and won't take action to fix the broken housing system. So why are they here in government? Waiting times for people classified as being in greatest need are increasing. The most vulnerable in our society shouldn't be forced to wait over a year for the basic right to have a roof over their heads; a place to call home, a bed to sleep in at night and a permanent address—all those things that most of us have the privilege to take for granted. If this is happening to those in the greatest need we can only imagine the distress of the hundreds of thousands of people living in housing stress.

Does the government have a plan for these people? Does it have a plan for people experiencing homelessness? Does it have a plan for those who can barely pay their rent each month or put food on the table? No, it does not. Clearly, that's the answer. This is a national shame. The government and its ministers should hang their heads in shame.

Malcolm Roberts (Queensland, Pauline Hanson's One Nation Party) Share this | Link to this | Hansard source

As a servant to the people of Queensland and Australia, I rise to support the National Rental Affordability Scheme Amendment Bill 2019. This year under the National Rental Affordability Scheme more than 28,000 homeowners will receive $11,000 each from the government in tax-free cash and in tax credits. This is supposed to be used to encourage the construction of new homes to be let at reduced rents to Australians who cannot afford to pay full price. It sounds good, right? Here's the problem. So far this scheme has cost the taxpayer $3.5 billion. Those new homes are subsidised no matter their location around Australia and no matter the size of the property. So owners naturally took advantage. Why should someone subsidise the rent on a $600-a-week home at a cost of $8,000 a year and pocket $3,000 when they can subsidise student accommodation at cost of $3,000 and pocket the rest—$8,000? This is yet another example of Liberal and Labor economic mismanagement.

What about the people in regional Queensland who have lost their jobs, who are really suffering? What would they think of this? What would the farmers think when they've had their property rights stolen from them and can't manage their farms anymore? What about the farmers who are surrounded by farmers who have given in to so-called carbon farming? They now have increased costs for handling feral animals and noxious weeds—additional costs thanks to Liberal and Labor policies. What about energy prices that are rising? What about water prices that are high, if they can get water? What about these people who are really suffering? What would they think of this? Nobody is building new houses in depressed regional areas. These Australians cannot benefit from this boondoggle.

We are destroying the productive capacity of this country, a country we all love, and leaving those who have been disadvantaged to fend for themselves. Meanwhile, successive Liberal and Labor governments waste billions on supporting foreign students and blow-ins with low rent—at taxpayer expense. We support the tightening of this bill. Yet we ask: who thought this would be a good idea in the first place? One Nation will support this bill to take taxpayers off the hook, and we ask the government to join us in supporting a rekindling of productive capacity for this beautiful country.

Anne Ruston (SA, Liberal Party, Minister for Families and Social Services) Share this | Link to this | Hansard source

The National Rental Affordability Scheme Amendment Bill 2019 makes amendments to the National Rental Affordability Scheme Act 2008 to streamline and simplify the administration of the National Rental Affordability Scheme, known as NRAS, until it ceases operation in 2026.

The amendments to the NRAS Act contained in this bill were included in the Social Services Legislation Amendment (Housing Affordability) Bill 2017 introduced in the 2018 spring sittings. On 19 October 2017, the Senate referred the housing affordability bill to the Community Affairs Legislation Committee for inquiry and report. The committee made a number of recommendations, which the government considered in consultation with participating states and territories. The committee recommended that the bill be passed.

NRAS is established by the National Rental Affordability Scheme Regulations 2008. In 2016 the Australian National Audit Office reported that the NRAS legislative framework is complex and unclear. The report noted the regulations could be reviewed with the aim of simplifying and clarifying aspects of their operation. NRAS stakeholders are of the same view. In December 2016 the Department of Social Services consulted with NRAS stakeholders to identify ways to improve the administration of NRAS and reduce the regulatory burden on approved participants.

Over 30 submissions were received with suggestions on how the regulations could be streamlined to support the efficient and effective administration of NRAS going forward. In its submission to the NRAS consultation paper in December 2016, the Commonwealth Ombudsman noted the need to improve transparency for investors in NRAS. The Ombudsman's submission also made recommendations on measures to strengthen the integrity and compliance of NRAS.

In January 2017, the Department of Social Services commenced a review of NRAS to address the concerns raised by the ANAO, the Ombudsman and the NRAS stakeholders. On 15 July 2017, minor regulatory amendments came into effect to address areas of NRAS that imposed disproportionate penalties for compliance which led to outcomes that were inconsistent with the objectives of NRAS. Further regulatory amendments were made in November 2017 and November 2018 to permit NRAS investors to request the transfer of an allocation in certain circumstances, and to provide other protections to investors. In March 2019, additional amendments were made to the NRAS regulations, strengthening the investor protection mechanisms available under the NRAS regulations and introducing a new compliance framework to manage and address misconduct by approved participants of the scheme.

The amendments introduced in this bill clarify ambiguous provisions in the NRAS Act relating to the power to make regulations, and lay the foundation to strengthen and simplify the future operation and administration of NRAS. The NRAS Act requires the NRAS regulations to prescribe that the rent charged for an approved rental dwelling must be at least 20 per cent less than the market rent at all times during the year. The term 'at all times during the year' has been subject to conflicting interpretations over the years. The first amendment supports the correct interpretation of this provision, which is that each time rent is charged it is to be at least 20 per cent less than the market rent. Some people interpreted it to mean the total rent charged across the year rather than each time the rent is charged.

The NRAS Act requires the NRAS regulations to prescribe maximum vacancy periods for approved rental dwellings. The prescriptive nature of the current vacancy provisions have been amended to allow greater flexibility for the NRAS regulations to prescribe permitted vacancy periods. This flexibility will assist the future administration of NRAS should changes be required on how the maximum vacancy periods are to operate.

Two new provisions will be added to the NRAS Act to provide express legislative authority for the NRAS regulations to vary conditions of allocation and put it beyond doubt that conditions may be varied or imposed after an allocation has been made. These provisions will reduce the risk of the Commonwealth when varying or imposing new conditions on allocations. The final amendment provides express legislative authority to transfer an allocation from one approved rental dwelling to another. The ability to substitute dwellings is crucial to achieve the objects of NRAS—to increase the supply of affordable rental dwellings. If an investor decides to leave NRAS, the ability to substitute a like-for-like dwelling ensures the level of NRAS housing stock is maintained.

The government's amendments make several important changes to schedule 1 of the bill. The amendments put beyond doubt that NRAS can include protections for investors, including by requiring approved participants to pass on state and territory incentives to investors in certain circumstances. The amendments also confirm that NRAS can provide protections for NRAS investors and allow for the adjustment of incentives where an allocation has been transferred for cause at an investor's request. NRAS relies on a number of Commonwealth legislative powers, and the amendments set out in these powers give the NRAS Act separate operation within the scope of each of these power.

The evidence given to the Senate inquiry suggested that there may be circumstances where, through inadvertence or oversight, a particular charge for rent may exceed the maximum rent that can be charged, which is 80 per cent of the market rent. The government's amendments permit NRAS to include a power for the Secretary of the Department of Social Services to grant an approved participant dispensation from an inadvertent breech of the 80 per cent rule in certain circumstances where the tenant has been fully compensated for that mistake.

While most approved participants in NRAS behave appropriately towards investors, a small number of approved participants do not do the right thing and make life difficult for investors by not passing on incentives promptly and engaging in other undesirable conduct. The government's amendments will permit the Secretary of the Department of Social Services to accept an enforceable undertaking from an approved participant. Enforceable undertakings are a useful compliance tool currently used by a number of Australian government agencies. The inclusion of this tool as part of the NRAS Act will assist the Department of Social Services to take appropriate action to protect investors where necessary.

The government is committed to reducing rental costs for low- and moderate-income households. NRAS was a flagship Labor program to improve rental affordability by providing a financial incentive to approved participants who rent dwellings at at least 20 per cent below market rents to eligible low- to moderate-income households. As was the case with many other programs, the former Labor government failed to put in the work in the planning stages in order to see the successful implementation of the well-intentioned policies. From the beginning, the scheme was poorly designed with multiple flaws, ambiguous legal requirements and red tape. The government is now fixing this and undertaking a series of legislative reforms to streamline and simplify the operation and administration of the scheme. This bill lays the foundation for improving the NRAS legislative framework to support the efficient administration of NRAS until it ceases operation in 2026. I commend the bill to this chamber.

Question agreed to.

Bill read a second time.