Scott Morrison’s massive Covid housing fail – not boosting social housing

As affordability concerns grow, the federal government has missed a big opportunity to make a crucial and long-lasting change to the housing market.

The big missed opportunity of the cash splash in the federal government’s pandemic stimulus was boosting social housing.

Given the now heightened affordability issues, it was high time to recognise that adequate housing is an important infrastructural investment that needs intervention by federal government to bring about better solutions through public, private and not-for-profit sector partnerships.

Done well it won’t come cheaply with estimates that increasing the housing stock by 100,000 dwellings – broadly sufficient to return the total social housing stock back to its historical share of the total housing stock – will cost $30 billion, with the average cost of building a social housing home at $300,000.

Instead of ramping up social housing delivery, the federal government spent big on putting the middle class into better homes with its HomeBuilder program, accompanied by the somewhat reckless JobKeeper program.

Protests greeted the announcement that Sydney’s famous Sirius Building, built as social housing in the 1970s would be sold off to private enterprise.

The current housing affordability inquiry being conducted by the federal government has been told that social housing substantially reduces tenants’ risk of homelessness. It has been noted just seven per cent of social housing residents become homeless, lower compared to similarly placed renters in the private market.

“Social housing can make a big difference to the lives of the worst off,” Brendan Coates at the Grattan Institute says, noting while lots of landlords rent to low-income households, many others leave their property vacant rather than lease to someone facing issues such as domestic violence, poor mental health, and drug and alcohol misuse.

The stock of Australian social housing – currently about 400,000 dwellings – has barely grown in 20 years.

Compass Housing Services has noted that following World War II all governments saw social housing as an safety net for low-income working families, building 670,000 homes

But the program gradually gave way to policies directed at promoting home ownership.

There was a brief interlude with the $6 billion Social Housing Initiative by the Rudd-Gillard governments which built 20,000 social homes during the Global Financial Crisis.

It is estimated that increasing the housing stock by 100,000 dwellings will cost $30 billion. Picture: NCA NewsWire/Bianca De Marchi

The Morrison government has certainly directed aid at helping the needy with its low deposit schemes for the likes of single parents.

But they are limited in scope and still experimental.

However non-government housing provider Compass says the federal government’s default position leaves state governments struggling and “creates a social and community crisis.”

The Grattan Institute has raised the prospect of a Social Housing Future Fund, making capital grants to state governments and community housing providers. It suggests borrowing at ultra-low interest rates that the government could issue $20 billion in bonds, and invest it into the fund.

That seems eminently sensible.

And perhaps something smart can still come out of the post-pandemic era – I’m thinking governments could take the opportunity to buy and convert emptied offices across Sydney into apartments for social housing.