Category Archives: Federal

News of national importance.

In support of the Treasury amendment

The Community Housing Industry Association has backed the objectives of the Treasury Laws Amendment (Making Sure Foreign Investors Pay Their Fair Share of Tax and Other Measures) Bill 2018.

In a submission supporting the amendment, CHIA contends that the main benefit of the housing-related measures in the Bill will be to facilitate institutional investment in long-term residential rental housing.

The bill will limit access to tax concessions for foreign investors, and provide incentives for investors to increase the supply of affordable housing, including by offering individuals the opportunity to invest in residential property via Managed Investment Trusts rather than by becoming a landlord.

You can download the submission here.

Happy new NHHA?

Four jurisdictions have now signed up to the new National Housing and Homelessness Agreement (NHHA) but, despite its early promise, there’s barely a mention of community housing in the four bilaterals so far finalised.

The six national housing priorities of the NHHA are social housing, community housing, affordable housing, tenancy reform, supporting home ownership and reform of the planning system.

Specific mention is made in the priorities of community housing strategies that improve the viability and encourage growth of the sector (may include redevelopment and stock transfers). However, there it stops; the four bilateral agreements released to date contain little to support the viability or growth of community housing.

Jurisdictions must produce a housing strategy that indicates the level of housing supply needed to respond to projected demand, outlines the reforms and initiatives that will contribute to meeting this need, includes planned or expected levels of social housing, and set out how the State will contribute to the housing priority policy areas. (Clause 17(a) of the NHHA). Most states and territories are reported to be working on new strategies, with varying levels of consultation.

Jurisdictions will report annually, with public reporting by 31 October of the following year.

While we encourage you to read the agreement in full, here’s what caught our eye:

South Australia
South Australia promises to have a new housing strategy and a new homelessness strategy in place and publicly available by July 1, 2019.
It aims for an adequate supply of land to meet long-term demand and a 30-year plan for Greater Adelaide to deliver a compact urban reform.

Improving the liveability of social housing stock is included, but only via a commitment that 75 per cent of new stock built by the SA Housing Trust will meet Universal Design criteria.

The development and efficiency of CHPs will be supported through finalising the transfer of 5,000 properties, with contractual requirements ‘that support the upgrade and renewal of CHP managed houses’.

Three reviews of current housing pathways/programs are mentioned, including:
• develop contemporary service responses for young people leaving care, with a new protocol between the Department for Child Protection and Housing SA to support young people into independent housing, in 2018.
• new supportive housing for people who have experienced chronic homelessness will be implemented by 2020
• the existing aged housing program (no timeframe).

The bilateral acknowledges the importance of community housing – over 40 per cent of social housing is managed by community housing providers in Tasmania. However, there are no measures in the bilateral targeted at community housing and only two measures specifically for social housing – a commitment to 15 new (hopefully extra) social housing dwellings a year, and $13.6m to upgrade 1,050 public housing dwellings.

The bilateral does provide for 10 rapid rehousing homes a year for people exiting institutions (from 30 June 2019), to avoid exits into homelessness.

The Tassie Government has an aim to keep home ownership at least 5 per cent above the national average, and will maintain its First Home owner grant program and review what government land could be re-purposed to housing.

The Tasmanian Government will continue to produce quarterly reports on progress against the state’s affordable housing action plan.

According to the bilateral agreement, the ACT has the most targeted public housing portfolio in Australia with housing allocated to those in greatest need. There are 22,000 people in public housing (it omits to mention the further 1,500 in community housing).

The bilateral promises a new ACT Housing Strategy in 2018. It will address legislative requirements and the requirements of clause 17 (a) of the primary housing
Agreement, covering ‘the full housing spectrum, from homelessness, through public
housing and affordable rental and home purchase opportunities’. Sadly, however, no mention of community housing.

The agreement does promise that the ACT will set and publish annual targets for public, community and affordable housing as part of the Indicative Land Release Program.

The existing ACT social housing model will be reviewed ‘to improve viability, identify and develop initiatives to achieve efficiencies and improve stock utilisation’. This is the closest the bilateral agreement comes to addressing community housing.

Like SA, the ACT undertakes to construct public housing dwellings that are built to national liveable design standards, but is silent about any retrofitting of existing social housing stock to meet the standards.

Northern Territory
The Northern Territory bilateral describes its ‘public housing portfolio’ as including community housing.

However the NT is to be congratulated for specifically including measures to develop and implement an urban Community Housing Strategy that identifies ways to support the growth of the NT CHP sector and inform the transfer of 750 urban public dwellings to the sector, as well as construct community housing dwellings in urban centres (by 2023).

The NT will have a new housing strategy in place and publicly available by September 30, 2019.

A review of rent setting models in urban and remote areas will be undertaken by December 2019.

The NT will also consult senior Territorians and those approaching retirement about aged care housing (to identify demand) and provide findings to the private sector to help identify potential opportunities for future private sector development of seniors-appropriate accommodation.

Planning reforms include allowing more scope for providing affordable housing products through
the incorporation of a flexible approach to zoning, including through the use of Specific Use Zones in the NT Planning Scheme, and facilitating land release in remote Aboriginal communities by extending the exemption under the Planning Act (Regulation 3A), which removes the need for subdivision approval for development associated with the $1.1 billion remote housing program.

Investment Mandate limit now $1b

In a new breakthrough, the Investment Mandate (IM) through which the Federal government will guide the activities of the National Housing Finance Investment Corporation (NHFIC) confirms that the NHFIC will be able to borrow up to $1 billion of Commonwealth funds to create a reserve pool from which it can lend to registered CHPs.

This ‘warehouse facility’ will provide bridging financing to CHPs until there are enough loans to warrant a bond issuance. While the final pricing of loans has not yet been revealed, this new development means that the NHFIC will be able to offer even cheaper finance than first thought, because it can source money through Commonwealth borrowing facilities, rather than just issuing bonds into the capital markets.

Accessing Commonwealth money up front also means that the NHFIC can process applications from CHPs for finance before it raises funds via a bond issuance. Over time, the NHFIC expects to be able to offer a range of different lending products as well. All of this is great news for CHPs and we look forward to seeing more details over the next few months.

There are a couple of other things worth noting. The Bond Aggregator has two aims – to provide cheaper finance to CHPs and to build institutional investor interest in a new asset class of affordable housing.

Over the longer term, the Bond Aggregator needs to be able to support itself. To meet all these objectives, the NHFIC will issue bonds to raise funds to repay the money that the Commonwealth initially tips into the NHFIC reserve pool and to raise more money for future CHP borrowing.

The IM is now published on the Federal Register of Legislation (search ‘investment mandate’).


New NHFIC Chair seeks shovel ready projects

Last week CHIA participated in an immersive day of briefing for the new National Housing Finance and Investment Corporation (NHFIC) Chair, Brendan Crotty.  In a wide-ranging conversation, Peta Winzar and Nicola Lemon (Powerhousing) filled the Chair in on the evolution of the community housing industry, its structure, property development record and its hopes for the NHFIC.

The basis for the discussion on industry capability was CHIA NSW’s insightful survey on the community housing industry’s property development record in that state, and its pipeline of planned developments over the next three years.

In response, Mr Crotty has asked for advice on what ‘shovel-ready projects might come before the NHFIC in the near future’.

Mr Crotty is also alive to the challenges of housing affordability outside our capital cities, and the challenges of construction costs in the north of Australia.

A significant part of the conversation revolved around the risks faced by community housing operators, and how these are managed.  Issues raised included the impact of uncertain/fluid government policy settings on the capacity of CHPs to plan for the future, and the difference a national housing strategy would make.

Establishing a solid pipeline of property development would enable CHPs to recruit – and keep – skilled staff and board members. While tight financial margins are a fact of life in the community housing industry, cash flows are high reliable and hedged against inflation. The extremely low levels of rental arrears are supported by Centrepay (which delivers over 90 per cent of CHPs rental income via direct deductions).

CHPs undertaking property development face similar risks to other developers but build-to-rent is a much lower risk prospect than build-to-sell products in the current housing market. It was pointed out that a number of CHPs are managing the financial risks around reliance on government contracts by diversifying into other business lines such as property management or body corporate services, or by operating across jurisdictions in different housing markets.

CHIA outlined some of its analysis of the board profiles of the 50 largest CHPs, which illustrate how CHPs have moved to recruit skills-based boards in response to the opportunities presented by NRAS and the Social housing Stimulus (over 40 per cent are graduates of the Australian Institute of Company Directors, for example).

One question that we were unable to answer is what the likely demand for Bond Aggregator loans will be from CHPs, since this depends so much on the price, the tenor and the conditions, applied. However, we do know that the 50 largest CHPs hold just under $1 billion in debt and assets of around $76 billion, which suggests that if the price is right then the demand to re-finance will be there!

You can search for the NHFIC Investment Mandate on the Federal Register of legislation.

The NHFIC website is up, but at the moment holds only press releases from the Treasurer and Minister Sukkar. We are promised a phone number soon.




CHIA congratulates new Chair of NHFIC

CHIA has welcomed the appointment of the National Housing Finance and Investment Corporation (NHFIC)’s inaugural chair.

The Treasurer, Scott Morrison, announced the three-year appointment of Brendan Crotty to the Chair’s role. A director of Brickworks Limited, General Property Trust and Dennis Family Holdings Pty Ltd, Mr Crotty will formally take up the role after Parliament passes the NHFIC’s enabling legislation.

CHIA Executive Director Peta Winzar says the appointment is an important step, with the community housing industry keen to see the NHFIC begin providing an affordable housing bond aggregator that will enable it to access cheaper and longer-term finance.

The NHFIC will also administer the $1 billion National Housing Infrastructure Facility which will invest in critical infrastructure with the aim of unlocking new housing supply.

Ms Winzar says she looks forward to further announcements on other NHFIC Board positions.

Community housing’s take on Budget 2018

The Commonwealth Government’s 2018 Budget has let the momentum slide on affordable housing.

While the 2017 Federal Budget laid the foundations for real improvements in affordable housing this year’s budget fails to follow through.

This budget focuses on tax reform, infrastructure investments, improving security, and the digital economy. The tax reforms are unlikely to impact on many community housing tenants but will provide some assistance to those in affordable housing: from 2018-19, an increase to the Low Income Tax Offset will deliver around $530 pa to 10 million low and moderate income earners. From July 2024, the 37 per cent tax scale will be abolished and only 6 per cent of the population with income over $200,000 will pay the highest marginal tax rate (45 per cent).

There is an additional $24.5 billion for infrastructure initiatives on top of the $75b announced in the last budget – no mention of housing, this is all roads, rail, ports and air infrastructure, and $1b to fix congestion in cities.

Major sector-specific measures:
The major measures focussed on the social and affordable housing sector in this year’s budget are:
• $550m over five years under a new Bilateral Agreement to improve Indigenous Housing in Northern Territory (already announced); and
• extra funding to improve the condition of public housing in the Northern Territory, including asbestos removal
• a related measure will provide $259.6m in 2017-18 to the NT government to offset GST reductions, so it can improve services in remote communities.

Minister Scullion’s Press Release advises that the government is in negotiations with the Queensland, South Australian and Western Australian governments ‘about future Commonwealth investment [in housing] in those jurisdictions’.

Minor sector-specific measures:
National Regulatory Scheme for Community Housing (NRSCH) will be funded $1.1m over 2017-18 and 2018-19 towards the evaluation of the NRSCH.
Australian Housing & Urban Research Institute (AHURI) will receive $5.5m/three years to continue the national housing research program.
The Australian Bureau of Statistics will receive $4.9m/four years to improve data collection of affordable housing stock estimates, planning and zoning activity, and dwelling construction cost. (This looks like the input to a National Housing Supply Council some time in the future.)
The Australian Institute of Health and Welfare (AIHW) will receive $0.2m in 2018-19 to improve its user interface for housing and homelessness data collections.

Broader housing-related measures:
The Australian Securities and Investments Commission (ASIC) will get an undisclosed amount to set up North Queensland Home Insurance Comparison website to help home owners compare premiums.

The Western Sydney City Deal will be funded $125m/five years to support infrastructure projects and liveability, including $15m for planning reforms to support housing supply in Western Sydney (this is redirected money from uncommitted funding, not new money).

Other matters:
Wage growth is expected to pick up in the broader economy to 3 per cent pa in 2019-20 (the increases under Social, Community, Home Care and Disability Services Award are phasing in until 2021). Inflation is projected to increase from 2.25 per cent in 2017-18 to 3.25 per cent in 2019-20. These movements may impact on Community Housing Providers operating costs.

There are some changes to income support arrangements that may have a minor impact on sector rental cash flows.

These include:
• the black economy taskforce response gets another $12.3m over four years – potentially impacting on some social housing tenants’ income declarations
• to encourage ‘lawful behaviour’ among income support recipients, the Commonwealth will be able to compulsorily deduct court-imposed fines and suspend/cancel welfare payments to people with outstanding warrants. How this will impact on tenants with Centrepay deductions is unknown. This may require renegotiation of rental payments for some tenants.
• pensioners will be able to earn up to $300pf (up from $250), without affecting their pension
• employment programs:
– jobs and skills for mature age Australians – $189.7m/five years
– transition to work – $80m/four years to support 40,000 young people aged 15-21 who are at risk of long-term unemployment
– the Community Development Program will ‘redirect $1.1b/five years to improve employment outcomes in remote areas’, including through 6,000 employment subsidies.

The following measures may impact on some CHPs:

Disability and Carers
• the National Disability Insurance Scheme (NDIS) is to be fully funded
• the NDIS Jobs and Market Fund – $64.3m/four years to help disability service providers take advantage of NDIS opportunities
• an additional $9.9m over two years will help Disability Employment Providers transition to the NDIS
• $92.1m/five years to ensure continuity of support for people who are not transitioning to the NDIS but are getting services under programs that are transitioning to the NDIS (programs not named)
• carer coordination – $113m/five years for Integrated Carer Support Services to help carers navigate the system through a new Carer gateway – an income test will be introduced for the Carer Allowance, with the carer and their partner required to have a combined income of less than $250,000 pa.

Older Australians
More Choices for a Longer Life – a package of measures for older Australians, including:
• 14,000 high-level care packages (on top of 6,000 already announced)
• 13,500 residential age care places
• $40m in capital grants for aged care facilities in regional and remote areas
• several measures focusing on quality of care, including an extra $8.8m to improve transparency of information on aged care provider quality
• more money for mental health services for older Australians
• $22.9m/two years to encourage older Australians to take part in physical activity.

Abstudy – $38.1m/five years will improve Abstudy payments, including providing boarding payments to kids under 16 getting Abstudy Living Allowance, more flexible travel arrangements and relaxed rules about which schools kids can attend.

Stronger Communities Round 4 – $25.9m/two years for small capital projects ($2,500-$25,000) that deliver benefits for local communities (redirected funds, not new money).

Building Better Regions Fund Round 3 – $206.5m/four years for investment in community infrastructure and capacity building projects in regional areas. [Note, some CHPs have accessed BBR funding from previous rounds to support mature age housing).

There are also some institutional reforms that may impact on how CHPs operate, for instance:

Australian Charities and Not for Profit Commission – $1m in 2018-19 to respond to ‘anticipated litigation’ as it pursues its role of regulating charities and charity registration
Consumer Data Rights – will allow people to share their data safely ‘with trusted and accredited service providers’.
The National Housing and Homelessness Agreement (NHHA) -Budget Paper No3 makes it clear that Commonwealth funding under the NHHA includes supplementation to the states and territories until 2021 to assist with wage cost increases under the Social, Community Services and Disability Industry Equal Remuneration order 2012. This was previously paid under a separate National Partnership Agreement for Housing and under the National Partnership Agreement on Homelessness for homelessness services. (There is no supplementation for CHPs unless states pass this on).
Rent Assistance – Rises from $4.4b to $4.53 mainly as a result of growth in age pensioner and carer pensioner populations.

What’s missing?
1. There is no National Housing Strategy in sight.
2. There are no measures to increase housing supply.
3. There is still no prospect of capital funding or additional subsidy to fill the gap between rental receipts and operating costs, to support the Bond Aggregator and Housing Infrastructure Funding announced in the last budget.
4. There is no reform of Capital Gains tax and negative gearing, which distort the housing market.
5. There is no reform of Commonwealth Rent Assistance (CRA) to alleviate housing stress among low income households.
6. The package of measures in this budget for older Australians, while welcome, is completely silent on housing stress among the 190,000 people over 70 who receive CRA.
7. There is no recognition that affordable, appropriate housing is essential to Closing the Gap for Aboriginal and Torres Strait Islanders, 79 per cent of whom live in non-remote areas.

In short, there is no National Housing Strategy.

Federal Budget silent on National Housing Strategy

This year’s Federal Budget shows exactly why Australia needs a National Housing Strategy, according to the Community Housing Industry Association (CHIA).

The $110m for five years to continue work on remote housing in the Northern Territory is very welcome, as is the added funding for the Australian Housing and Urban Research Institute and the Australian Bureau of Statistics to improve housing data. Spending on infrastructure to reduce urban congestion and improve transport networks to support our growing population is welcome. The $15m to encourage planning reforms in Western Sydney is a good start.

But this Budget is silent on one of the biggest pressures facing Australian households: housing affordability, says CHIA Executive Director Peta Winzar.

‘House prices at the top of the East coast capital city markets may be coming off the boil, but home ownership remains a challenge for many families on low and moderate incomes and more than 40 per cent of low income renters are in housing stress,’ Ms Winzar says.

‘Unless we have a National Housing Strategy and the programs to support it, housing will still be on the front pages of the paper in 12 months’ time, when tonight’s tax cuts promised tonight hit people’s bank accounts. And it will still be a problem in 2024 when the 37 per cent tax bracket is eliminated.’

In 2017, the Treasurer laid the groundwork for a coherent, sustained effort to improve housing affordability, raising the hopes of a growing number of Australians who are finding themselves it increasingly difficult to afford a secure, affordable and appropriate place to call home.

‘We now need a National Housing Strategy to follow through,’ Ms Winzar says.

‘We need a National Strategy that commits to more fundamental tax reform to remove the distortions in the housing market. A Strategy that includes reform of Commonwealth Rent Assistance to reduce rental stress for private renters.  A Strategy that sets housing as a core component of infrastructure investment. A Strategy that commits to delivering 200,000 social and affordable dwellings over the next decade.

‘We need a National Housing Strategy which guides a sustained effort of all levels of government to fix housing affordability, especially for those on low and moderate incomes. Because being able to afford somewhere to live is more important than a generic tax cut,’ Ms Winzar says.


Property tax reform the answer to housing affordability

Last financial year, the Commonwealth Government spent less than $6 billion on assisting low income renters and over $70 billion on providing housing assistance to property owners.

In a country that prides itself on giving everyone a fair go, the balance needs to change, according to a pre-budget submission to the Commonwealth Government by the Community Housing Industry Association (CHIA).

CHIA’s Executive Director, Peta Winzar, says owner occupiers received capital gains tax exemptions worth $61.5 billion last year, and property investors and trusts reaped a further $9.6 billion via capital gains tax concessions. [1] A total of $76 billion of tax breaks for property owners.

Meanwhile, the Commonwealth spent just $4.53 billion on Commonwealth Rent Assistance for low income renters, with 40 per cent of CRA recipients still being in rental stress after receiving the payment (defined as spending more than 30 per cent of household income on rent).

‘At the moment, the taxation system is heavily weighted in favour of those who own property against those who are unlikely to ever be in the position to buy their own home,’ Ms Winzar says.

‘Reforming Capital Gains Tax and negative gearing could deliver savings of up to $30 billion a year – more than enough to alleviate rental stress among one million low-income renters and to build 200,000 more social and affordable housing units which are desperately needed,’ she says.

‘We propose removing the Capital Gains Tax exemption from home-owners and progressively reducing the CGT discount on residential property from 50 per cent to 25 per cent.

‘The 50 per cent CGT discount rule is intended to adjust a capital gain by reference to inflation, but the current rules over-compensate sellers, particularly where properties are held for just a few years,’ Ms Winzar says.

‘To discourage unhealthy property speculation, we are also proposing that the CGT discount be reduced to 15 per cent where residential property is re-sold within five years of acquisition.’

‘And negative gearing could be better used to stimulate additional housing supply if it was restricted to new homes,’ Ms Winzar says.

Ms Winzar says it’s time for the Commonwealth to find a better balance between assisting home owners and renters.  These reforms of taxation policies can reduce the incentive for speculative investment that drives prices higher, ensure profits from selling into rising markets are shared more fairly between property owners and the wider community, and deliver more affordable rental housing.

The taxation reforms were just part of CHIA’s pre-budget submission to the Commonwealth. Click here to view the submission in its entirety.

[1] The Treasury. 2016 Tax Expenditures Statement. Table 1.1 p9. The value of exempting home owners from CGT ($34 billion), the value of the 50% CGT discount for home owners ($27.5 billion), CGT discount for individuals and trusts ($9.6m). Negative gearing is not reported as a tax expenditure, but is estimated at between $0 and $5 billion; See Dale, T. Budget impacts of negative gearing, in Parliamentary Library Flagpost Blog August 2015.


Strong economic argument for govt investment in housing

Economist Adam Smith’s ‘invisible hand’ is looking a bit arthritic when it comes to the housing market, according to Professor Duncan McLennan.

At a seminar in Sydney this week, Professor McLennan proposed a strong set of economic arguments for government investment in housing to support the traditional arguments of affordable housing as a merit good which makes a critical social contribution.

Professor McLennan observed that, across the western world, governments had stepped back from investing in affordable housing in the 1980s, following the idea that the market should prevail. It is now abundantly clear that Adam Smith’s theory of the invisible hand of the market would see the self-interested actions of individuals frequently benefiting society more than if actions that were intended to benefit society is not ensuring good outcomes for those on low incomes.

The broader housing market is made up of a mosaic of housing sub-markets that interact in complex ways with the wider economy. In cities like Sydney, the housing market has become so overinflated compared to the wider housing market that government cannot manage it using the usual monetary policy solutions without disrupting the wider economy.

It is surprising how little analysis there has been in Australia of the impact of housing on the economy, he said.  Yet housing represents 20 to 25 per cent of the household budget; it is the most significant asset and major debt of households.

When households spend more and more of their income on housing costs, they divert spending away from consumption of other goods and services and they save less. Productivity is lowered by the long commutes of key workers, congestion in our cities, and the mismatch of jobs and housing.

There is a strong intergenerational impact as well he said.  Children’s educational outcomes are impacted by poor housing and concentration of low income households in more affordable areas, away from job opportunities, compromises the school to work transitions of young people. A new narrative is needed, he argued, which deals with housing as part of a country’s essential infrastructure, not as separate or in opposition to investment in transport or energy, for example.

McLennan’s presentation was followed by a panel discussion involving Jennifer Westacott, CEO of the Business Council of Australia, Emeritus Professor Judith Yates, and Dr Marcus Spiller of SGS Economics.

Ms Westacott  flagged that the Business Council of Australia is keen to work with the sector on housing policy.  She identified that one of the reasons for our housing problem was the failure of planning systems to take a long-term, integrated view of transport housing and other infrastructure.

We need to encourage large scale private sector investment into affordable housing and reform the taxes and charges that distort the housing market. Westacott said it was time to look again at how housing subsidies were delivered into social housing, observing that the situation now might be very different if the Howard government’s 1996 proposals had succeeded (to replace the Commonwealth-state housing agreement funding to the states with  rent assistance).

Innovation in the monolithic public housing system was nigh impossible, Ms Westacott said.

Judith Yates urged the audience not to abandon the social justice narrative in the pursuit of stronger economic arguments for government investment in housing. There is plenty of evidence that growing inequality itself lowers a country’s productivity, she said, but we should not just be concerned about inequality because of its impact on productivity.

Yates asked if we succeed in changing the housing system to increase productivity, how will the benefits of that increase be shared across the community? Looking towards Australia in 2117, she challenged the audience to think more creatively about the housing challenge – should we be building more cities for instance?

Marcus Spiller of SGS Economics challenged the audience to consider why governments had become so deaf to the economic arguments for intervening in the housing market.  Since neither the Federal nor state governments appear able to deal with Australia’s housing challenge, he proposed that a better way to transact housing policies would be to devolve authority for matters such as planning and taxes to the regional level.  Regional, he hastened to add, means metro-wide planning approaches. Spiller also asked the question of who owns the development rights to land – while ownership of the land is clear, surely the development rights belong to all of us.


Submission rejects expansion of ACNC role

In a submission to the Treasury’s Review of the Australian Charities and Not For Profit Commission (ACNC), the Community Housing Industry Association (CHIA) has rejected a proposed expansion of the ACNC’s remit.

The ACNC had recommended that its Act be amended to include promoting the effective use of  resources of not-for-profits and accountability to donors, beneficiaries and the public.

CHIA Executive Director, Peta Winzar, says the recommendation is misguided.

‘First and foremost, the Board of a not-for-profit organisation is responsible for ensuring its resources are used effectively,’ Ms Winzar says.

‘Second, in the community housing sector the state-based regulators which operate under the National Regulatory Scheme for Community Housing, and its counterparts in Victoria and Western Australia, periodically review the effectiveness of both for profit and not-for-profit registered community housing organisations.

‘Third, the he National Regulatory System for Community Housing (NRSCH) publishes sector-wide data on the effectiveness of the registered sector. Sector-wide information about tenant and housing outcomes of community housing organisations is also published by the Productivity Commission in its annual Report on Government Services.

‘So we see no value in the ACNC shadowing the functions of a Board, or duplicating the existing arrangements for regulating and reporting on community housing organisations,’ Ms Winzar says.

However, CHIA did support the ACNC’s proposal to include a statutory definition of a ‘not-for-profit organisation’ to clarify how assets will be handled in the event of an organisation winding up.

‘CHIA would also welcome further work by the ACNC and the Australian Accounting Standards Board to improve the reporting framework for registered charities,’ Ms Winzar says.

‘We would, of course, expect that changes to the reporting framework will advance the existing objective of the Act to reduce unnecessary regulatory obligations on the Australian not-for-profit sector.’



Electoral funding reforms to impact CHOs

New Federal Government legislation which aims to prevent foreign donors from having undue influence in Australian politics will impact on charities including community housing organisations that spend $100,000 a year on political advocacy, CHIA’s Executive Director Peta Winzar has warned.

The Electoral Funding and Disclosure Reform Bill is designed to tighten laws on allowable donations to ‘registered political campaigners’ and to political entities (parties, candidates, and organisations associated with a party). Organisations, including charities, will have to register as ‘political campaigners’ if they spend more than $100,000 a year on political purposes.

‘They will also need to supply details of directors and senior staff, including their membership of registered political parties. Civil penalties can apply to someone who incurs political expenditure without being appropriately registered,’ Peta says.

Organisations will have to keep records to show whether donations of more than $250 were from ‘allowable donors’ (generally an Australian citizen or permanent resident).

The legislation’s key clause defines political purpose to mean any of the following purposes:

(a) the public expression by any means of views on a political party, a candidate in an election or a member of the House of Representatives or the Senate;

(b) the public expression by any means of views on an issue that is, or is likely to be, before electors in an election (whether or not a writ has been issued for the election);

(c) the communicating of any electoral matter;

(d) the broadcast of political matter (other than political broadcasts covered by the Broadcasting Services Act 1992); and

(e) the carrying out of an opinion poll, or other research, relating to an election or the voting intentions of electors.

If organisations spend more than $100,000 a years on advocacy, it will have to register as a ‘political campaigner’. The immediate impact of this will be extra record-keeping and a requirement to supply an annual return, within 16 weeks of the end of the financial year, which includes:

  • Details of directors and senior staff including membership of political parties;
  • Details of grants, contracts, payments and other benefits from the commonwealth, State or territory government which require discretionary decision-making
  • An auditor’s report, and
  • A signed statement that any foreign donations have not been used for domestic political purposes.

‘The government has also indicated that it wishes to remove charitable status from organisations whose sole focus is advocacy. If a community housing organisations lost its charity status, it could potentially face a significant increase in staff and other operating costs,’ Peta says.

The charity sector, led by ACOSS, has lobbied strongly against the Bill under the ‘Hands Off Our Charities’ banner and has called for all registered charities to be exempted from the Bill’s reporting and disclosure requirements.

‘However there is a strong public policy argument in favour of seeking to limit the influence of foreign actors on Australia’s democratic system,’ Peta says.

‘This is a complex area and CHIA has adopted a balanced response in its submission to the Joint Standing Committee on Electoral matters, arguing that the Bill needs further consideration, and that there is a strong case for exempting charities that receive no or small foreign donations.’

The committee will report to Parliament by 6 March and you can download CHIA’s letter to the committee here.

CHIA calls for national housing strategy

CHIA Chair Michael Lennon has told the Senate Economics References Committee inquiry into the National Housing and Homelessness Agreement (NHHA) that a national housing strategy is absolutely critical to fix Australia’s social housing shortfall

Michael told the Senate inquiry that halting and reversing the decline of social housing stock over the past 15 years would take a significant commitment from all levels of government and all political parties, over several decades and is unlikely to be achieved without national oversight

The inquiry is investigating the development of an agreement that will replace the existing National Affordable Housing Agreement between the states and the Commonwealth, which has failed to deliver an increase in social housing over the past decade.

The new agreement presents the perfect opportunity for the states and the Commonwealth to collaborate on a National Housing Strategy to guide investment over the longer term, Michael told the inquiry.

‘A National Housing Strategy is one of the missing pieces of the puzzle. If the NHHA legislation requires states and territories to have housing and homelessness strategies, it is entirely appropriate that the Commonwealth also has a National Strategy,’ Michael said.

‘In fact, it makes no sense to plan otherwise.’

Michael also detailed the core elements that needed to be included in state and territory housing strategies, such as specific targets and strategies to improve Indigenous housing outcomes, mechanisms to support the bond aggregator in providing long-term and low cost finance for social housing, and consistent national regulation and standards to be applied equally to community and public housing.

Michael also argued that the states and territories should transfer 50 per cent of public housing dwellings to the community housing sector.

‘Community housing is the only arm of social housing which is growing in size, capacity, and sophistication. Unlike public housing, community housing has a strong track record of leveraging assets to increase the number and quality of social housing dwellings.

‘Expanding the community housing sector also provides healthy competition and promotes choice for tenants.’

Download CHIA’s full submission to the inquiry.

CHIA has started work on what we want to see in the 2018 Federal Budget to improve housing affordability and we want your ideas. However, time is short, so you’ll need to get them to us fast!

In an unusually early start to the Budget process this year, the Treasurer has asked for Budget submissions to be lodged by mid-December.  This means we will need to get your policy proposals by December 1, 2017, so we can finalise our submission by the deadline.

If you have ideas to improve housing affordability for renters or for home buyers, ideas to increase housing supply, or ideas to help people who are homeless or at risk of homelessness, then we want to hear them.

We are particularly interested in your proposals for reforming taxes – not just the well-rehearsed suggestions like changes to negative gearing and the Capital Gains Tax, but ideas for the other quirky bits of the tax system that make it difficult to do business, create inconsistent outcomes, or could create big opportunities for change.  (For example: enabling developers to claim gift deductibility on their tax if they donate housing stock to charities could encourage developers to increase the amount of affordable housing in developments. Currently, donated stock can’t be regarded as a gift if it has been transferred as a condition of a planning permit that requires the provision of affordable housing.)

So send us your ideas – anything from a couple of sentences to a page is fine. Here are a few questions that will help us pull all the ideas together: What is the problem that needs to be fixed? What are good arguments in support of this proposal? Will it benefit any particular group (for example, older renters, people living in regional areas, Indigenous Australians, first home buyers)? Would it affect many people? How much is it likely to cost or save?  Is the wider community likely to support or oppose it?

Email your ideas through to [email protected]

CHIA Chair Michael Lennon has been asked to take part in an innovative community engagement initiative that aims to connect everyday Australians with decision-makers and experts and develop solutions to key issues.

The not-for-profit Australian Futures Project is running the #WTF (What’s the Future?) project over four weeks this month, covering four key issues facing Australians: the energy crisis; the future of work; housing affordability; and, thriving kids.

On Monday, October 23, Mr Lennon will be one of eight housing affordability experts fielding  questions from the public via various #WTF social media channels. The public will then be invited to contribute their solutions to the issues, which will be added to a report that brings together the facts and discussion and will be used to inform a roundtable debate by decision-makers.

Community organisations will then be funded to act on solutions.

CHIA members and stakeholders are encouraged to be part of the debate. Go to the #WTF website for details on how to take part.

Housing hub home for disabled dwellings

Housing Hub website homepage


The Housing Hub is a new way for Community Housing Providers to list their disability housing vacancies, and people with disability to find suitable housing.

The website:

  • lists housing vacancies for people with a disability, including NDIS housing, existing Specialist Disability Accommodation (SDA) properties, new SDA builds, non-SDA supported accommodation, private rental and properties for sale
  • enables eligible people to submit an Expression of Interest in NDIS Specialist Disability Accommodation housing
  • has a library of useful information about housing options and planning your move.

The Housing Hub will continue to grow and develop nationally, with more vacancies, features and information continually being added. Help make the site a success for people with disability by spreading the word and sharing the link 

Landscape shift for affordable housing

symposium powerpoint

Landscape shift for affordable housing

Attendees of an affordable housing symposium, held at Griffith University, heard CHIA CEO Peta Winzar speak about the Federal Government’s September release of key reports, draft legislation and a consultation paper, which collectively signal a major shift in government thinking in relation to financing social and affordable housing.

Ms Winzar told the symposium that these four measures, together with some complementary budget measures announced by some state governments this year, have the potential to significantly alter the financing landscape for affordable housing.

  1. The Affordable Housing Working Group,

The Affordable Housing Working Group, which was set up by state and federal treasurers to investigate innovative ways to finance affordable housing has released its report with three recommendations.

Its prescription for closing the funding gap between rents and operating costs contain no surprises – targets, planning mechanisms, tax reform, contributions from affordable housing providers, and so on.  This is a list which could have been written a decade ago.

While it acknowledges the need to increase direct subsidies for affordable housing, the working group’s report stops short of suggesting how this might be done.

The report does contain some good examples of how to increase housing supply at no cost or low cost to government, for example, redevelopment of public housing properties, with the government getting a return either in cash or in replacement dwellings, or government taking a share of the profit from development of government land, in partnership with a developer or a CHO, or cross-subsidisation through a mix of market sale, affordable sale, affordable and social rent in a development

It also makes some valuable recommendations about strengthening the regulatory framework for community housing, and overhauling the national industry development framework for community housing.

  1. Bond Aggregator 

The aim of the bond aggregator (BA) is to raise institutional finance at scale from the wholesale bond market and then lend the money to Community Housing Providers (CHPs) for longer terms and at a cheaper rate than those offered by banks. The CHPs would apply for loans, pay a small fee towards the administrative costs of the BA and their borrowings would then be aggregated.

The government’s proposal is for the Bond Aggregator to sit under the new National Housing Finance and Investment Corporation (NHFIC), but there are still some design issues to be sorted out, for example:

  • Exactly how long the term of the bond would be – probably up to 10 years. This would give CHPs certainty about financing costs and remove the need for them to renegotiate with their bank every three to five years
  • How much cheaper the BA would be – this would depend on the credit-worthiness of the community housing sector and whether the government guarantees the bond
  • the proposal that the borrowing be secured against the title of properties held by the CHP, which raises interesting questions about the conditions under which state governments would allow properties under long-term management by CHPs to be used as security for a loan.

Treasury is seeking feedback on these questions and others as part of its broader consultation on the structure and operation of the NHFIC.

  1. NHIF report

The Commonwealth Government is currently running a consultation on the National Housing Infrastructure Facility (NHIF) and the NHFIC. What’s innovative about this in a housing context is that it is a legislated vehicle at the Commonwealth level but it will be able to invest in City Deals at the state and territory level.

It will also be able to invest in projects at the government’s direction and the aim is for its investment returns to enable it to be self-sustaining over the medium term.

Note that it is intended to prioritise development projects with an affordable housing component.

The consultation paper on the NHFIC and the NHIF is on the Treasury website, consultation closes on 20 October 2017.

You can download Ms Winzar’s presentation here.