‘Buy a house’: is Scott Morrison living in the same country as the rest of us?

Treasurer Josh Frydenberg pitched his election budget as one tackling the rising cost of living. But he proposed no policies to address one major driver of our inflation uptick — the rising cost of rent.

The price of renting a home in Australia increased last year by the highest annual amount in more than a decade. This included regional areas, where the working-from-home revolution has increased demand and prompted rent rises of up to 25% in some areas.

When Today host Allison Langdon asked the prime minister about this on Wednesday, Scott Morrison replied: “[The] best way to support people who are renting a house is to help them buy a house.” This was widely ridiculed as a Joe “get a good job” Hockey-esque betrayal of elite aloofness and class prejudice.

But Morrison’s comments, and his government’s lack of rental relief policies, illustrate a specific prejudice shared by many federal politicians: they look down upon renters. They routinely treat renting as a brief waystation on the road to home ownership, instead of a long-term way of life for millions of Aussies that ought to be improved. This is despite an increasing proportion (more than a third) of Australians renting their homes, for longer periods, due to skyrocketing house prices.

I think I'm just frustrated because it's not just climate activists – it's NGOs, senior public servants, politicians, Ministers. They've all got Homeowner Brain, blind to how a third of the population live.

— grug stan (@grugstan) January 30, 2022

This might be easier to swallow if government efforts to support more renters to buy homes weren’t so limited and ineffective. The First Home Loan Deposit Scheme, which Morrison touted in his Today interview, is likely to provide a marginal benefit to the 45,000 successful applicants, but will further push up house prices and rent costs for the rest of us.

Both major parties have regrettably walked away from more effective policies for bringing house prices within reach of prospective first homebuyers — negative gearing and capital gains tax reform — effectively ensuring that a growing proportion of the population rents their homes.

Yet in nearly every budget, the government announces lukewarm policies pitched at prospective homebuyers, fig leaves used to explain away doing nothing substantive on house prices and even less to improve the cost and conditions of renting. Renters rarely even show up as “winners” or “losers” on the media’s budget scorecards, for we’re hardly discussed.

There is much the federal government could do to help renters with rising costs if they wanted to — particularly those who are most at risk of rental stress (when rent costs more than 30% of household income) are those on the lowest incomes, particularly welfare recipients.

To address this, a rental assistance supplement was added to various dole payments. The Morrison government recently raised this supplement, but by a minuscule $3 a fortnight to $145.80 for singles and $171.50 for families. This covers less than a third of the average single person’s rent and a quarter of the average couple’s.

Even on the progressive side of politics, the importance of rent assistance is often overlooked. The Greens once supported raising it by 30%, but failed to mention it in their recent, otherwise commendable welfare package, and Labor has focused on social housing.

The Grattan Institute has proposed increasing the supplement by 40%, and indexing the payment to “changes in rents typically paid by people receiving income support, so that its value is maintained”. The Australian Housing and Urban Research Institute has also suggested changing eligibility criteria, as out of 1.4 million low-income private renters, only 933,000 receive financial help.

This change would be particularly useful for young people and elderly renters. About 40% of young people say they struggle with housing costs, compared with 23% of baby boomers. But for those elderly Australians who don’t own their home, the Retirement Income Review found they “achieve poor outcomes in terms of financial distress and income poverty”. Many of our welfare and superannuation policies presume that older people will own their homes, disadvantaging those who don’t.

In the absence of federal action, some state governments have begun helping renters improve their day-to-day lives. The Victorian government, for instance, introduced a renters’ rights package last year, which prevented landlords from unreasonably preventing basic property modifications, owning pets and more.

Meanwhile, after comedian Tom Cashman’s story went viral of having his successful rental application revoked for asking for a “landlord reference”, ACT Labor MLA Michael Pettersson (a renter himself) is presenting a motion to require landlords to provide a reference from a previous tenant if requested.

“The federal government must lead a coordinated national housing strategy involving all layers of government and addressing all aspects of housing tenure,” said Farah Farouque, director of community engagement at Tenants Victoria. “Short-term fixes won’t do. We need significant Commonwealth interventions and leadership.”

Maintenance request to Scott Morrison: please renovate our nation’s renter support system. You might still be distracted by the “Australian dream”, but those of us living in the new Australian reality would appreciate more than weak gestures and false hope.