City Futures Blog

News and research in housing and urban policy, from Australia’s leading urban policy research centre.

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Why City Futures backs social housing stimulus plan

Posted by on May 5th, 2020 · Economy, Government, Housing supply, Pandemic

By Bill Randolph, Director, City Futures Research Centre

With Australia’s economy taking a record-breaking pandemic hit, governments now face the huge challenge of reviving employment as the health crisis subsides. It’s widely agreed that a stimulus spending program should be a central plank of the recovery plan.  

Construction is an obvious stimulus target, since, in normal times it employs 10% of Australian workers. Not only that, but only today comes the news that seasonally adjusted measures of building industry activity, employment and new orders have fallen to all-time lows.

Ramping up infrastructure spend could also help make inroads into Australia’s long-term investment deficit in this area. But it’s vital that this extends beyond ‘more roads fixed and bridges built’ as recently advocated by the Prime Minister.

The stimulus program must also include social housing. For one thing, housing construction can be ramped up a lot more quickly than most large transport and other projects. For another, this presents us with a chance of beginning to redress the decades of disinvestment in this vital sector, a history that has seen social housing provision effectively contracting by a third since the 1990s. And much of what remains is sorely in need of upgrading.  

Data from Productivity Commission Report on Government Services (various editions) plus ABS Cat 3101.0.

City Futures research has helped to quantify both the scale of Australia’s social housing shortfall and the cost of a remedial program. We’ve also highlighted the economic productivity case for affordable rental housing investment. In itself, the construction of 30,000 social homes as part of a pandemic recovery stimulus package won’t provide a total fix for our ailing housing system, but it will help to put us on a healthier track. That’s why we back the industry plan published today.

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