Mr Speaker Labor supports this bill.
The National Rental Affordability Scheme was set up by Labor in 2008.
Investors are provided with 10 year contracts through both state and federal funding and rent is provided at 20 per cent below market rate.
When the Abbott Government came to power they cut all new funding for the scheme and capped it at 38,000 dwellings.
They also didn’t replace this scheme with anything else.
NRAS is still helping a lot of people with the cost of housing but the number of people that benefit from the scheme is now reducing every year.
This year we have lost 1,141 homes.
Next year we will lose 1,368 homes.
By 2026 there won’t be anyone benefiting from the scheme.
Until then the scheme will keep operating and it’s important it operates as well as it can.
And this Bill makes a number of important changes to the operation of the scheme that we 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It ensures that any payments to investors are done in a timelier manner to ensure NRAS stock is not withdrawn from the scheme.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 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 the Government incorporated some of Labor’s recommendations into this Bill and also undertook to include the other recommendations in the new regulations when they are made.
We have consulted with a number of stakeholders including the National Affordable Housing Providers, the National Affordable Housing Consortium and Community Housing Industry Association and they support this legislation.
I hope that the Government consults with organisations like these when it drafts the new regulations that are going to be needed.
Mr Speaker we moved a number of amendments to this Bill in the Senate to ensure the Departmental Secretary retains the ability to make new allocations under NRAS.
This means that if this Government or a future government wants to extend NRAS funding they will be able to.
The Government has made it clear it is not planning to allocate any new funding to this scheme. That’s their decision. Nothing in this Bill or this amendment requires it to do that.
But it might change its mind or a future government might wish to use this Act to help build more affordable housing.
Therefore it makes sense to leave this power in the Act.
And I am glad to say the Government has accepted this argument and agreed to support our amendments.
But Mr Speaker there are bigger issues here than just what the Government is trying to tackle in this legislation.
Australia has a housing crisis.
Home ownership rates are now at the lowest rates in 50 years.
Rental stress is through the roof.
And more Australians are now homeless than ever before.
These are the big issues we need to confront, and the Government’s not doing it.
That’s why I move this Second Reading Amendment:
That all words after “That” be omitted with a view to substituting the following words:
“whilst not declining to give the bill a second reading, the House:
(1) notes that:
(a) this Liberal Government slashed the original cap of 50,000 dwellings in the National Rental Affordability Scheme (NRAS) to 38,000;
(2) As a result of the Government’s continuing inaction to meaningfully address housing affordability:
(a) the percentage of Australians who own their own home has dropped to its lowest level since Robert Menzies was Prime Minister back in the 1960s;
(b) the number of Australians behind in their mortgage today is at its greatest level since the global financial crisis;
(c) a report released last month by the Australian Institute of Health and Welfare showed that in 2017–18 over 1 million low-income households were in financial housing stress and that 43.1 per cent of low income households renting in Australia are suffering rental stress; and
(d) there are more homeless Australians than ever before”.
Mr Speaker, a report that came out this year from the Australian Institute of Health and Welfare shows that over the last 10 years we have lost more than 20,000 public homes.
Public housing construction hasn’t kept pace with population growth.
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 waiting longer than two years.
People in private rental are also really struggling.
Rental stress is through the roof – particularly in major cities like Sydney and Melbourne as well as Hobart where rent has increased by 9.8 per cent for houses and almost 13 per cent for units in the past year.
A recent report by the Australian Institute of Health and Welfare showed that more than 40 per cent of Australians on low incomes that rent are in rental stress: in other words, more than 30 per cent of their income goes just to pay the rent.
The shutting down of NRAS – and not replacing it with anything else is only going to make this situation worse.
In the next six years about 37,000 families are going to see their rent go up by about 20 per cent.
That’s because this scheme is shutting down.
On average that means around 160 families in every federal electorate that will see their rent go up massively.
The economy is really struggling at the moment.
You see that in the report from the IMF this week.
Economic growth is predicted to be less than it is in Greece.
Bills are going up, but wages aren’t.
Interest rates are at crisis levels.
During the GFC they were at about 3%.
They are now at less than 1%.
Consumer confidence is down.
Business confidence is down.
Housing construction is down.
And yet the Government keeps acting like nothing is wrong.
Like everything is hunky dory.
It’s not hunky dory.
There are a lot of people really struggling.
According to the Reserve Bank there are now more people behind in their mortgage than at any time since the GFC.
You know people are really struggling when they can’t pay their mortgage.
As I said a moment ago renters are struggling too.
The greatest pressure was in greater capital city areas where it was 47.8% of low income households whereas it was 35.6% of low income households in the rest of the states and territories.
There are also over 1 million low-income households in housing stress right now.
Homelessness is also on the rise – according to the last Census there are more homeless Australians than ever before.
This is leading to people seeking other assistance and a report released by FoodBank last week showed the number of people seeking food relief has increased by 22 per cent.
Housing construction is also going backwards.
Building approvals are in freefall – they are down almost 22 per cent on last year.
Construction job ads are also down 35 per cent from their peak in December 2017.
We’ve already lost about 50,000 construction jobs in the last 12 months and according to UBS up to 100,000 workers could be laid off in the future.
That’s on top of the issues we’ve seen with flammable cladding and shonky building inspectors.
This is all bad for the economy.
The Deputy Governor of the Reserve Bank talked about this today in Sydney.
He said there was a ‘sizeable downturn’ underway in the construction sector – and that it is a drag on the economy.
He said the RBA is expecting housing investment to drop by a further 7 per cent next year – and that it could be even larger – and that this would take at least 1 per cent off overall GDP growth.
This should be ringing warning bells in the Government.
But it doesn’t seem to have any plan to deal with any of this.
They have just got their head in the sand.
Saying everything is going to be ok.
Well that’s cold comfort to the Australians who are out there at the moment struggling to pay their bills, pay their mortgage, pay their rent or keep a roof over their head, or keep their job.
They need a government with a plan to tackle this housing crisis.
And they don’t have one at the moment.