Budget 2021: Coalition scoffs at Labor’s ‘unrealistic’ housing plan

Morrison government slams Labor’s $10bn housing plan, saying future fund requires a 20 per cent return.

Housing Minister Michael Sukkar. Picture: David Geraghty

The Morrison government has hit back at Anthony Albanese’s $10bn future fund aimed at delivering affordable homes, saying it unrealistic and requires the fund to generate a 20 per cent return.

Housing Minister Michael Sukkar took aim at the proposal, unveiled in the Opposition Leader’s budget reply address, saying Labor would “need to more than triple the current benchmark return for the Future Fund of 6.1 per cent to be able to deliver his (Mr Albanese’s) 20,000 dwellings”.

But Nicholas Proud, chief executive of PowerHousing Australia, the peak body for social and affordable housing, said Mr Albanese’s future fund was a “landmark proposal”.

“This future fund proposal will shore up jobs (and) boost the economy whilst safeguarding ­social and affordable housing rental outcomes for generations,” he said.

“We know there is pent-up demand for social housing and there was an affordability crisis prior to COVID that low wages growth and double-digit house price increases has only exacerbated.

“This type of proposal would support dwelling investment and jobs at a time of significant decline which, as estimated in Tuesday’s federal budget, will start later in 2021 with further declines in housing in 2022.”

Kate Colvin, spokeswoman for Everybody’s Home, which runs a national campaign against homelessness, said booming house and rent prices were “driving many Australians to desperation, especially in regional communities.

“Expanding social and affordable housing means greater choice and relieves pressure,” she said. “It is noteworthy that federal Labor recognises the important role for the commonwealth in social and affordable housing. The states simply cannot solve the rising problem of housing stress and homelessness without the commonwealth’s financial firepower.

“(Labor’s) commitment to devote one-fifth of these homes to women and children ­escaping ­violence also deserves ­recognition.

“Demand for such housing is simply not being met.”

Under Labor’s plan, the Nat­ional Housing ­Finance and Investment Corporation would oversee construction of 30,000 social housing and ­affordable homes funded by a new Housing ­Australia Future Fund to be managed by the Future Fund Board of Guardians.

It would deliver investment returns to NHFIC to pay for social and ­affordable housing projects.