The Greens and Labor are not getting on. “What’s new?” you may ask. Animus between the two is nothing novel. But relations have sunk to new lows recently.
At issue is housing policy, especially the Greens’ decision to block Labor’s $10 billion housing policy centrepiece. Matters came to a head in the final week of Parliament before the winter recess, with Housing Minister Julie Collins, backed by Labor backbenchers, launching attacks on the Greens for delaying the vote in the Senate.
Prime Minister Anthony Albanese and Greens housing spokesman Max Chandler-Mather exchanged words on the floor of the house. The government even made veiled threats about a double dissolution.
Why is the government so grumpy? The relatively noble aims of its policy help explain some of its anger at what it sees as Greens’ grandstanding. The policy’s $10 billion fund is meant to stimulate affordable housing, even if it is in a few years. While the Greens point to market failure, the policy is planned to deliver social housing through not-for-profits such as housing associations. It will also support emergency housing for victims of family violence, and housing repair and maintenance for remote First Nations communities.
Chandler-Mather also seems to get under Labor’s skin. He has an undoubted talent for publicity. Something about his fresh face and glib media presentation — scarcely unusual traits for an up-and-coming politician — make him a particular target for Labor criticism.
Labor is broadly correct to argue that blocking the housing fund policy will crimp future social housing supply, compared with the status quo. The government is also right to point out that the Greens’ policy of capping rents won’t increase housing supply (and could even hurt it).
But many of Labor’s attacks are overblown. Collins, for instance, has been running the line that every day the Greens don’t pass the bill is a delay in increasing housing supply.
“Every day of delay is more than $1.3 million that does not go to housing for people that need it”, she said in June. This doesn’t make a lot of sense, because it will not dribble funding out daily. In any case, even if billions were delivered tomorrow, housing construction would take some time to begin.
In policy terms, the Greens are surely right to point to the manifest flaws in the funding model. At the heart of their criticism is the overly complex structure of the fund, which will channel public funds into an investment vehicle that will then generate returns for housing investment. The Greens very reasonably have asked why the government, sitting on a large and growing surplus, can’t simply fund housing out of the budget.
Labor has never had a satisfactory answer to this, probably because, as economist John Quiggin argues, there isn’t one. As he wrote on his blog in 2021:
To the extent that the hypothecation is genuine, it means that the money available for social housing depends on the performance of the sharemarket. And this dependence is the wrong way around. The case for public spending on social housing is strongest, both in terms of need and the availability of resources, when the economy and the share market are doing badly.
Indeed, the government appears to tacitly acknowledge this, because it has announced an extra $2 billion for social housing, to be spent immediately across the states and territories.
There might be another reason the government is finding Chandler-Mather so irritating. He’s winning. In his short time in Parliament, he has almost single-handedly dragged the housing debate in Australia well to the left. He’s done it by championing the interests of one of the fastest-growing, but least influential, segments of the Australian electorate: renters.
The Greens have noticed something important about Australian politics. A new and increasingly important voting demographic is rising: middle-class renters. Thirty-somethings with kids used to be the sort of voters that a former PM, John Howard, called “aspirational”. In the 1990s, the Coalition won big with policies that favoured homeowners and those keen to buy homes.
A generation of asset price inflation has radically changed the electoral landscape. The rapid inflation in housing prices since then has put homeownership out of reach, even for double-income couples in white-collar professions. Many now rent. According to the authoritative Australian Election Study, just 26% of renters voted for the Coalition in 2022.
While Labor will be loathed to admit it, Chandler-Mather’s full-throated defence of renters has cut through. In part, this is because of the depth of the housing and homelessness crisis. But it is also because he is prepared to sharpen class rhetoric against landlords, a class of Australians that is widely seen to be profiting from the misery of tenants.
The grinding injustice of renting is the underlying social condition that gives the housing debate its teeth. As I’ve argued before, renting in Australia is hell. Despite some modest reforms to tenancy laws in some states and territories, most tenants are still treated more or less like lineal inheritors of medieval serfdom. With the average private tenancy lasting just 12 months, renters enjoy little security and possess few rights to enforce even basic maintenance or repairs.
As Paul Karp noted perceptively in Guardian Australia last week, the stoush on housing has played well for the smaller party: “With three times as many renters as Greens voters in Australia the rental class conflict is all upside for them, and all downside for Labor.” As the housing crisis deepens, the terrain moves further in the Greens’ favour.
The much-ballyhooed “Overton window” is an insider phrase often misused in political commentary. In a technical sense, it simply means the acceptable spectrum of political debate. But the Greens have moved the Overton window on housing policy, much to the discomfort of the government.
As Chandler-Mather claimed in February in the socialist masthead Jacobin — much to Albanese’s displeasure — “by refusing to pass Labor’s housing plan without even a debate, the Greens forced a national discussion about large-scale investment in public housing and a rent freeze”.
For a generation, housing policy in Australia has been about showering tax concessions on property owners, while politicians mumbled incoherently about affordability. In little more than a year since the federal election, the Greens have moved the terms of the housing debate from mealy-mouthed platitudes about housing supply to a sharp-edged debate about rent controls.
Have the Greens oversimplified the housing debate? Or is Max Chandler-Mather on the right track? Let us know by writing to letters@crikey.com.au. Please include your full name to be considered for publication. We reserve the right to edit for length and clarity.
If Future Funds are so good, let’s funded defence through one. Let’s fund hospitals and policing. Let’s fund border security via such a fund. What? That’s not feasible, we need defence now, same with hospitals, police and a secure border? Well, we also need houses for the people who generate the wealth that fund all those other things. Defence is a nice to have, quite frankly, and of little interest to someone living on the streets.
A homeless person who is already living with deprivation and fear for their safety may ask precisely what is worth defending.
The Australian Sovereign Wealth fund, the Next Generation Technology Fund are Future Funds that fund the military. Every hospital is paid for by a market backed fund. The hospitals put their government payments into interest earning funds, backed by the market. The Eastern Health Foundation, Alfred Foundation, The Royal Melbourne Hospital Foundation, and there’s hundreds more. Future Funds are a good way to park money while and before it’s spent. Simply because it earns interest. Most charities never spend the money they receive in donations, they just spend the interest earned on donations. So Future Funds are that good.
Spoken like an economist. Future funds living off the future of the renters themselves. Simply an iron in the fire of the pyramid system.
Government is not a business. It has no need to “park money” or “earn interest”. It creates the money it has to spend when it needs to be spent.
Worse still – the HAFF is costing $400m a year in interest expense. So it needs to make $900m in order to leave $500m for housing.
That’s inaccurate because Golden boy Max is trying to mislead with his scare campaign. The $300 million in fees is on the entire Future Fund which is already running and invests about $150 billion all told and returns on average nearly 8% over its life. $300 million is something like 0.2 % charges in fees on $150 billion which when you are 8% return is pretty cheap. I mean how could HAFF cost $300 million because it hasn’t been passed yet and doesn’t exist. Charging $300 million on something that doesn’t exist would be an excellent rort.
Max’s scare campaign has all the same hallmarks as the ‘No” campaign for the Voice.
It’s a classic scare campaign and every LWNJ on here has fallen for it. Every one of those points is simply demonstrably false.
Pro tip. Many of us “LWNJs” (ie: Actual left-wingers, rather than the neoliberal centrists who can’t wait to make the Government look even more like a business) recognised how sh*t the HAFF was from the minute it was proposed, before Max had anything to say about it.
RWNJ’s and LWNJ’s are pretty much the same. Driven by emotion, grievance, paranoia and misinformation and vulnerable to the good old fashioned scare campaign. It’s pretty bad when your own side are playing you for fools though. Mathers is on the make purely for himself. He clearly has no interest in actually delivering social housing.
Whether Mathers goes completely wrong is that he, and the Greens refuse to discuss population growth and the ability to accommodate it.
Well covered. This backs up what I’ve always said, that as a Greens voter you can influence public policy without the party necessarily winning government. There are plenty of other examples of Labor being dragged to a better policy position in reaction to the Greens gaining ground in a particular area. The improved rights of tenants in Victoria, for one, is basically down to the Greens being competitive with Labor in inner-city Melbourne seats.
Certainly any attempt to drag the ALP back to the Left from inside the party would be shouted down by the power brokers, or just ignored.
Any attempt? Certainly any attempt imaginable by the half-imaginary milquetoast vapours passing for the Left in Labor.
Chandler-Mather is guilty of being personable, intelligent, articulate and of explaining the Greens’ position in clear language. Labor has no-one to match him let alone anyone capable of selling their own inadequate housing policy.
I’d buy a ticket to watch him debate whichever spokesbot ‘Labor’ puts up – it would cruel & unnecessary punishment to wheel on the putative Housing Minister Collins.
Totally agree! He has also tapped a growing sector of voters with no allegiance to either major party.
Zut, I think you know I am a lifelong Labor voter, but have occasionally voted Greens. On this I agree totally. The States have basically privatised social housing aided and abetted by the Federal Government. And what a cluster f… we now have. Lucky me owns a lovely home and is just dandy. No investment properties. But I do care where our country is heading.
It’s not only the cost of rent which affects low income earners, its the one sided power (im)balance which is held by the landlords and their unscrupulous agents. The renters’ outlook for permanent or long term housing is dire. The standard lease term is one year and in the current market tenants are often faced with unrealistic terms for renewal. We need to adopt long term rental as a reality with appropriate rules to suit. Balance needs to be restored between landlords & tenants to ensure that the property is considered to be a home at least as much as it is an investment commodity.
The primary reason most Continental nations opt for rent control was not out of altruism but the demonstrable need for social peace in place of true equity.
Never mind that it took centuries and several devastating, city levelling wars for the obvious fact to dawn on the ruling classes that nothing promotes more social stability than security of tenure. (In employment also)
Perhaps we could try that here?
Though high rents and mortgages do, to a certain point, help with labour discipline. Nothing like having people only four or so pay packets from disaster to keep them focussed and compliant.
Well put, Punter. You have to rent to see how bad the power imbalance is. Complain about unfairness? You will almost certainly go on a list of troublemakers with some agencies. Expect across the board rules? Expect again. Have a pet? Good luck finding a place that will take it and expect to pay about 20% more rent if you do. Advocacy groups? Not in many cities, and most are overwhelmed by demand. Feel like campaigning about the unfairness of it all? Better keep your face covered.
There are some good landlords and rental agents out there. But that’s not the point. No one should have to have their lives rely on the goodwill of those collecting your money.
“ No one should have to have their lives rely on the goodwill of those collecting your money.“
That’s gold, Frank, and sums up the position all of us who rent find themselves in.
Nice article Ben. Unfortunately most media outlets don’t recognise the fact that the housing crisis and the cost of living crisis both revolve around interest rates. I’m from a generation where 13% or 17% interest on your home loan was normal. The difference is the sum of money on which it is being charged. 6% is a fair price for borrowing money, it’s just the amount of money you have to borrow that’s disgusting.
Housings is affordable when the median house price is 3x the median income. Unnafordable at 5x median income. Above that is market failure. Australia’s median income is $52,338 while the median house price is $723,006. That’s 13.8x. That’s complete and utter market failure. There is no owner/occupiers buying, unless they are so wealthy they don’t care about social policies anyway. That’s why the discussion is all about renting affordability. The new paradigm is all but a few being life long renters.
It’s not a housing crisis. There are plenty of houses being airbnb’d, holiday homes, left empty, under utilized and over sized. It’s in fact simply an inequality crisis.