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Community cabinets: a vehicle to promote government policy

By Chris Lewis - posted Friday, 6 August 2010


With Opposition leader Tony Abbott’s promise to end community cabinet meetings and Prime Minsiter Julia Gillard defending them, this article argues that such forums in the past have had little impact on policy. Rather, as evident by policies and debate concerning housing affordability and disability services, community cabinet meetings provided an avenue for the Rudd government to sells its policy messages.

In terms of housing, the Rudd government often appeared more interested in promoting Australia’s GDP at community cabinet meetings rather than addressing public concerns. At the Launceston meeting (November 5, 2008), when one person called for “real leadership” in line with a recent CSIRO publication suggesting that Australia’s population should be 25-27 million people by 2050, Rudd stated “migrants means more housing needs … which helps create employment in the construction industry”.

At other meetings, Rudd contrasted Australia’s booming housing sector with poorly performing developing economies around the world (Ballajura, April 22, 2009 and Beenleigh, Queensland, June 30, 2009).

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Other meetings promoted policies intended to boost the supply of rental housing for poorer households by 50,000 homes, and the construction 20,000 new “social housing dwellings” (as part of its economic stimulus package).

At Ballajura, Western Australia (April 22, 2009), Rudd noted how the government had provided $62.5 million for 4,200 first home owners in Western Australia between October 2008 and February 2009. At Townsville (December 8, 2009), Rudd also highlighted the $84.9 million to create more affordable housing in North Queensland. At Hobart (October 13, 2009).

These policies did not deliver, despite widespread public concern about housing unaffordability.

Large institutional property investors benefited most with the National Rental Affordability Scheme giving them up to $6,000 a year per property for up to 10 years in refundable tax offsets and grants. They also received a further $2,000 per property which was provided by state governments.

As noted by the managing director of SQM Research Louis Christopher (and others) during September 2008, the scheme was contributing to higher house prices under $500,000, making home purchases more expensive. Home affordability was also not helped by cutbacks to superannuation benefits for high-income earners given the likelihood of a high yield with pressure on rents with vacancy rates at only 1 to 2 per cent.

ABS data reveals a large increase in average house prices in percentage terms from the March Quarter 2009 to March Quarter 2010: Sydney (21), Melbourne (27.7), Brisbane (12.1), Adelaide (10.8), Perth (15), Hobart (14.1), Darwin (17.5) and Canberra (20.6).

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In fact, most of the government’s housing policy aims failed. In February 2008, the government established a First Home Savings Accounts to assist first-home buyers to save a deposit. Yet, as of June 30, 2009, just 13,946 accounts had been opened instead of the 220,000 predicted in its first year.

And with 50,000 low-cost homes promised by Labor by 2012, just 2,416 social housing dwellings had been built by February 2010.

No wonder the Salvation Army stated in 2010 that homeless rates had not decreased in the past 18 months with a higher risk now because of the housing shortage.

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About the Author

Chris Lewis has an interest in all economic, social and environmental issues, but believes that the struggle for the ‘right’ policy mix remains an elusive goal in such a complex and competitive world.

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