Page 776 - Week 04 - Tuesday, 1 May 2007
Next page . . . . Previous page . . . . Speeches . . . . Contents . . . . Debates(HTML) . . . . PDF . . . .
The greatest disappointment of the debate on public housing in the ACT is that it has allowed the policies of the Australian government, particularly since 1996, when the coalition gained power, to be skated over. At the start of 2006, ACTCOSS and Shelter together published The wealth of home—a call to action on affordable housing, intended to inform the minister’s housing summit. The minister has treated that report with contempt. This could simply be because it did not offer the advice that he wanted. The wealth of home includes a brief but clear analysis of the impact of commonwealth programs of the past few years. It argues:
The Commonwealth Government has a significant impact on the housing market, both through its spending programs, most notably the Commonwealth-State Housing Agreement, Rent Assistance, and the First Home Owner’s grant, and through its taxation treatment of housing assets.
It points out that the federal government’s provision of finance for public housing has declined in real terms in the last decade while commonwealth rent assistance has increased, and argues:
The continuing rise in housing stress despite the provision of CRA, as well as its possible effects in expanding demand and placing additional pressure on rental prices, has led some commentators to criticise CRA as ineffective.
The key impact of commonwealth policy, however, lies in the revenue forgone from the taxation treatment of housing assets. The report continues:
The Commonwealth Government exempts owner-occupiers from the capital gains tax, and gives a discounted rate on investment properties held for more than a year. There are significant tax advantages created by opportunities for negative gearing of investment properties. In addition, the imputed rent from owner-occupied housing is not taxed, despite its inclusion as income in the national accounts.
A study by AHURI found that the non-taxation of capital gains for homeowners resulted in up to $13 billion of forgone revenue for the Federal Government and a further net $8 billion from the non-taxation of imputed rent.
Perhaps most tellingly, the study found that the beneficiaries of these tax benefits were high-income, high asset groups rather than those on low incomes.
Despite its contribution to social housing and rent assistance, the net effect of Commonwealth policy settings gives the greatest benefits to those at the higher end of the income scale.
Professor Pat Troy was recently on ABC Radio’s Australia-wide Sunday night talkback program arguing that the commonwealth’s move away from its post-war public housing commitment to the provision of public housing is imposing a significant social and economic cost on our society. In summarising his position, he has since said:
The Commonwealth’s decline in support for public housing and the conditions it forced on the States and Territories led them to convert their housing stock to
Next page . . . . Previous page . . . . Speeches . . . . Contents . . . . Debates(HTML) . . . . PDF . . . .