Nine things the federal government needs to do to fix affordability: UDIA

Nine things the federal government needs to do to fix affordability: UDIA
Jennifer DukeDecember 7, 2020

Australia’s housing affordability and supply problems are on the radar of the Urban Development Institute of Australia, whose new National Policy Agenda identifies four key areas for reform, and a number of things that the federal government can do.

Looking at the areas of taxation, red tape, infrastructure and planning, UDIA national president Cameron Shephard said that governments can address housing affordability but also need to counter the issue of supply, a fundamental cause of the issue.

“A chronic shortage of housing in many major cities has resulted in rapidly escalating prices and rents, which has led to worsening housing affordability, and put home ownership increasingly out of reach for many ordinary Australians,” said Shephard.

“Fundamentally, the solution to this problem lies in reducing and removing the barriers to new housing supply, such as high taxes and charges on new housing, poor planning, delays caused by red tape, and inadequate urban infrastructure."

A number of their recommendations were also to state and local governments, including the first three of the nine points below. They also recommended that state governments reduce their reliance on upfront developer charges by investigating alternatives, create long-term plans, reduce reliance on stamp duty and similar taxes, and look to planning system reform.

Here are their nine suggestions for the federal government:

  1. Identify population growth trends through the use of regular growth forecasts.

  2. Actively use population growth forecasts to underpin comprehensive strategic plans for increasing urban infrastructure investment, and improve land-use planning and land supply.

  3. Ensure that sufficient resources are available across different levels of government to implement strategic land use and infrastructure plans over the short, medium and long term.

  4. Ensure that infrastructure investment decisions are subject to rigorous and comprehensive cost benefit analysis, to ensure the greatest value for money on new projects.

  5. Further investigate non-traditional methods of funding infrastructure, to increase the level of funding available for investment at both a federal and state level.

  6. Ensure that all levels of government cooperate and coordinate their regulatory activities to identify best practice, standardise regulations where possible, and avoid conflicting legislation, to create certainty.

  7. Work to reduce duplication with state and local government processes, including continuing to streamline federal and state environmental assessment and approval systems. 

  8. Assist state governments with phasing out stamp duty by broadening the base of the GST. 

  9. Include state and local government levies in GST cost base calculations to improve the integrity of the tax system and reduce the incidence of double taxation.

Source: UDIA

Jennifer Duke

Jennifer Duke was a property writer at Property Observer

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