Greens seek $5bn boost to back Labor’s house fund

Modelling by the independent budget watchdog has found a $5bn annual investment in housing would fund the construction of more than 100,000 public and affordable homes over the next five years.

Greens housing spokesman Max Chandler-Mather says it was time for Labor to ‘admit their plan will make the crisis worse’. Picture: NCA NewsWire / Gary Ramage

Modelling by the independent budget watchdog has found an annual federal investment of $5bn in housing, to be matched by state governments, would fund the construction of more than 200,000 public and affordable homes over the next decade.

The forecasts by the Parliamentary Budget Office were commissioned by the Greens, who say Labor’s $10bn Housing Australia Future Fund will see a shortage of housing worsen.

They are calling for the government to increase its proposed housing investment by $4.5bn in order to secure its vote in the Senate.

Labor is locked in negoti­ations with the minor party over its centrepiece housing policy, with the off-budget fund designed to build 30,000 new social and affordable housing, including 4000 homes for women and children impacted by family and domestic violence.

The Greens are negotiating the balance of power in the upper house after the Coalition formally opposed the fund, along with opposing Labor’s $15bn National Reconstruction Fund and safeguard mechanism overhaul.

The Greens promised to build one million new, publicly-owned homes over 20 years in the lead-up to last year’s election.

The new costings found the $5bn federal annual investment into social housing - to be matched with $5bn from state and territory governments - would fund 225,000 homes and enable the government to earn an estimated $13bn in rental returns over the next decade.

Greens housing spokesman Max Chandler-Mather said it was time for Labor to “admit their plan will make the crisis worse”.

He said his party would support the policy only if the ALP invested directly in housing.

“You don’t tackle the housing crisis by gambling money on the stockmarket, you solve it by investing directly in building public and affordable housing, like governments used to,” Mr Chandler-Mather said.

The Greens policy would decrease the fiscal balance by around $904m and the underlying cash balance by around $824m, which reflects the debt interest on the investment.