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On whose account? Government spending on housing
Every year billions of dollars are dispensed through the Federal Budget on direct support to households and housing service providers, including Commonwealth Rent Assistance (CRA), social (public and community) housing construction and maintenance, homelessness services, help-to-buy schemes such as first home buyers’ grants and shared equity programs, Indigenous housing services and defence housing.
On the tax side of the federal budget, billions of dollars in revenue are forgone by the provision of tax concessions to property owners. The Tax Expenditures and Insights Statements published by the Department of Treasury and Finance detail various property tax concessions, but the costs and benefits are not evaluated in relation to direct government expenditure on housing programs nationally.
The lack of a Department of Housing, or of a consolidated housing policy and portfolio budget statement, means that there is no way for the public, or even for policy-makers, to understand whether our tax and transfer system is operating effectively in the housing system.
This paper attempts to build a coherent picture of Australia’s real federal housing budget, and to determine how government intervention in the housing market affects housing affordability and security. It looks at the history of government housing programs and asks whether the tens of billions of dollars the public gives to support the housing needs and choices of Australians is money well spent in the pursuit of a fairer, more inclusive and more sustainable society.
The paper is composed of three parts:
- Firstly, it provides an account of actual federal government expenditure on housing, and posits that the current method for accounting for housing expenditure is opaque and inconsistent;
- Secondly, it draws together historical data on spending from different federal housing-related programs in order to highlight how federal housing expenditure has changed over time; and
- Thirdly, assesses how these changes have altered the distribution of the federal housing spending between different income quintiles, providing a lens through which to consider whether the public money injected into the housing market is creating a more or less unequal country.
