Shorten’s subsidy plan to boost affordable housing



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Labor would work with community housing providers, the residential construction sector and institutional investors.
Flickr, CC BY

Michelle Grattan, University of Canberra

Institutional investors would receive long-term subsidies to build new dwellings – on condition they rented them out below market rates – under an affordable housing program Bill Shorten is announcing on the first day of Labor’s national conference in Adelaide.

A Labor government would offer 15-year subsidies – $8,500 a year – for investors building new homes provided they charged rent at 20% under the market rate.

The program would cost A$102 million over the forward estimates to 2021-22 and A$6.6 billion over the decade to 2028-29. The costing was done by the Parliamentary Budget Office.

In his Sunday announcement, Shorten says that the ALP’s ten-year plan to build 250,000 houses and units would be Australia’s “biggest ever investment in affordable housing”. The plan includes 20,000 dwellings in the first term of a Labor government.

“This is a cost-of-living plan, a jobs plan and a housing plan. It will give working families a fair go to put a roof over their head now – and save for their own home in the future.”

He says these dwellings would be available to renters on “low and moderate incomes”. A family paying the average national rent of $462 a week could save $92 a week.

Labor would work with community housing providers, the residential construction sector and institutional investors.

“Labor’s plan will provide investors with certainty to build – knowing that they will have long-term government support and guarantees beyond the decade.”

Shorten says access to housing is one of the biggest challenges to dealing with intergenerational inequality, as an increasing “wealth gap” locks people out of the housing market.

“Increasing the supply of affordable housing is critical to addressing pressures on disposable income and, in turn, addressing inequality.

“Labor’s plan will deliver affordable, environmentally sustainable housing that helps to reduce energy consumption and cost-of-living pressures on Australian families.”

Shorten says the existing rental scheme – the National Rental Affordability Scheme – has attracted private investment of about A$12.9 billion, delivering 37,000 dwellings in a decade.

“Despite this success, the Liberals have abandoned affordable housing and axed the subsidies that encourage affordable housing. There is a severe shortage of affordable rental housing in Australia and many families are struggling to find and keep a roof over their heads. The number of Australians experiencing rental and mortgage stress is at record levels.”

The Australian Housing and Urban Research Institute estimates a shortfall of more than 525,000 affordable rental properties, Shorten says.

Overseas students, temporary foreign workers and other non-residents would not be eligible to rent under the Labor scheme.

Shorten says the plan would support the ALP’s reforms to negative gearing, “which direct concessions to newly built premises and encourage housing construction”.

Labor hopes that the three-day conference will end the year on a high note for the opposition, after its strong two-party performance in polling during 2018. Maximum effort has been made to ensure that internal policy differences are managed to avoid damaging public divisions.

Shorten told a press conference on Saturday that he hoped to see “energetic, enthusiastic debate” at the conference.

He said “perhaps the most valuable proposition that Labor presents the Australian people at the federal election within the next five months – it’s a united team, it’s energetic and it’s a team with vision”.

Shorten defended his undertaking that Newstart would be reviewed ahead of an ALP government considering an increase.

“I think Newstart is too low. I don’t think anyone who says that it needs to increase is wrong.

“But what we’ll need to do from government is review the level and understand the implications of increasing Newstart, along with the impact on all of our other taxes and payment systems.

“We have to look at what we can afford as a nation. But we’re not reviewing Newstart to decrease it.”

On the sensitive issue of asylum-seeker policy, Shorten told his press conference a Labor government would put whatever resources were needed into stopping boats.

It would also support regional and offshore processing. It would take refugees into Australia – “properly, not via people smugglers”.

“We want to be a good international citizen – we also recognise, however, that we’ve got to make sure that whatever policy we adopt we can afford, and that it meets our combined goals of not keeping people in indefinite detention on Manus and Nauru but also keeping our borders strong, so we never again see the people-smuggling trade start up.”The Conversation

Michelle Grattan, Professorial Fellow, University of Canberra

This article is republished from The Conversation under a Creative Commons license. Read the original article.

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Households to get $2000 subsidy for batteries under Shorten energy policy


Michelle Grattan, University of Canberra

A Labor government would subsidise households to install batteries as part of the ALP’s energy policy to be unveiled by Bill Shorten on Thursday.

If Labor wins next year’s election, it would provide from 2020 a A$2000 rebate for 100,000 households, with annual incomes of less than $180,000, to buy and install battery systems. It would also provide low cost loans.

The ALP puts its emphasis on boosting the use of renewables, in a policy that keeps the National Energy Guarantee – abandoned by the government in the leadership meltdown – as an option on the table. The opposition indicates it is prepared to implement the NEG but its policy is providing for the future if agreement on it cannot be reached.

The ALP estimates the battery subsidy would triple the number of battery systems in Australian households. The policy sets a national target of one million household battery installations by 2025.

“The massive boost will also help manufacturers scale up production and reduce their costs”, Shorten and energy spokesman Mark Butler said in a statement.

They said the ALP policy would “help Australians slash their power bills.”

“The Smart Energy Council estimates that new household solar and batteries would allow most homes to save more than 60 per cent off their power bills”, Shorten and Butler said.

“Australians love renewable energy because they know it saves them money and it’s good for the environment”, they said, pointing out that household solar installation had rising from 7000 homes in 2007 to 1.8 million today.

“Supporting the installation of more household battery systems is the next big step in helping families keep their energy bills lower. When the sun goes down, or when electricity usage is at its peak, consumers can draw on their own stored energy”, Shorten and Butler said.

They said this was good for both consumers and the environment. People gained more control over their power bills, and cheaper and cleaner energy would help Australia achieve 50% of power from renewables by 2030.

A Labor government would also invest $100 million in a Neighbourhood Renewables Program, so renters and people in social housing could benefit from cheaper and cleaner energy.

The cost of the battery subsidy and the neighbourhood scheme is estimated at $215.9 million over the current forward estimates. The costing has been done by the independent Parliamentary Budget Office.

Shorten and Butler said Labor would “establish community power hubs to support the development of renewables projects in local communities – such as solar gardens on apartment rooftops, community wind farms, energy efficiency upgrades for social housing and grants for community groups to pilot new projects.”

They said the new initiatives built on Labor’s commitments to crack down on price gouging by power companies.

Labor’s policy on energy would create thousands of jobs in the renewable industry, they said.

In a speech to be delivered on Thursday, Shorten stresses a Labor government would seek bipartisanship on the NEG.

“We want a meaningful NEG that actually lowers prices, reduces pollution, and boosts renewables” he says in an extract released ahead of delivery.

“If I am elected as prime minister, I will sit down with the new opposition leader and the crossbench to talk about a way we can move forward with this framework,”

“But let’s be clear: we will work with the Coalition – but we will not wait for them. Our willingness to cooperate on a market mechanism doesn’t mean everything else gets put on hold,” Shorten says.

He says a Labor government would be prepared to directly underwrite and invest in cleaner cheaper power.

“We will prioritise renewables and support firming technology power like storage and gas. Labor will invest in new generation, in better transmission and distribution – because we realize this vital nation-building work cannot be left up to the big power companies.” Labor’s plan would deliver affordability, reliability and sustainability, Shorten says.

Labor’s battery subsidy program would be reviewed after two years, in light of projected falls in battery costs and to assess progress towards the one million new battery installations by 2025 target.The Conversation

Michelle Grattan, Professorial Fellow, University of Canberra

This article is republished from The Conversation under a Creative Commons license. Read the original article.