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State Development, Construction and Housing – Delivery of New Housing

Cassy O'Connor MP

Cassy O'Connor MP  -  Tuesday, 7 June 2022

Tags: Housing

Ms O'CONNOR - Thank you, Chair. Minister, as we have outlined, according to the Productivity Commission's Report on Government Services, there have only been 578 new social and affordable houses built over the last seven years. Do you agree that despite the promises to initially build 941 new homes, then 1500 new homes, that is a massive underperformance? And will you commit to doing significantly better than every one of your predecessors and all of them put together?

Ms HADDAD - We want you to succeed, we want you to say yes.

Mr BARNETT - Thanks very much. As I said earlier, I think what unites us is greater than what divides us. I think we are all in this together and I appreciate the good will around the table to help make a difference in this space, because that is really important, and I acknowledge that and I thank you for it.

In terms of our agenda going forward, it is very ambitious, and we have a plan to implement that. I am committed to doing so. And that is the 10 000 homes by 2032. It is a very big agenda. I will ask the deputy secretary to respond to the details about the first part of your question.

Mr WHITE - Thanks Minister. In terms of new homes constructed, we have delivered under the program since 2015. From the Dashboard released on 30 April, we have been involved in and completed 2111 additional new-home-lots of land in new places; that includes:1225 social housing dwellings; 133 units of supported accommodation; 69 units of homeless accommodation; 283 new homes under home-ownership program HomeShare; and 401 lots of land. They are the numbers that have been delivered since 2015. The ROGS data you are referring to captures social housing at a point in time. However, over the year we have sales of properties, we have demolitions when we are looking to redevelop and increase densification in certain areas. Those numbers obviously come off those portfolios each year.

In the case of homes that are sold to the market, there is still housing that is made available for housing for Tasmanians, and we make a number of those available for our Streets Ahead and HomeShare programs as well.

Ms O'CONNOR - Thank you, Mr White. Can we have some precise projection of how many social and affordable homes will be built in this term of parliament? Or within the forward Estimates' time frame; noting that only $35 million of the promised new money is contained in the Budget.

Mr BARNETT -I disagree with the last comment, because there's $204 million in the budget papers for capital investment; $538 million over the forward Estimates is in the budget papers. I'm happy to drill down and discuss that in greater detail if required.

I want to make it clear that the 20-year Housing Strategy is underway, in terms of its preparation. I will be seeking, or my department will be seeking, feedback from the community sector; building and construction sector and the community more generally. This was one of the PESRAC recommendations, that:

The State Government should develop a comprehensive Tasmanian Housing Strategy to drive practical actions to deliver more sustainable housing market outcomes across Tasmania for all Tasmanians.

It has come out of PESRAC, and we have $2 million to progress that. In terms of that strategy, I would expect that to get to a landing-point in and around next year, 2023. I do not have the exact time, but it is early 2023, I can advise you. That strategy will outline the mix that we are looking for in terms of not just affordable and social housing, but also the geography and a whole range of areas such as gender, family, age, the whole mix across the board in terms of where we want to go, based on what I would call an environmental scan, looking at what the needs are, responding to those needs, in the short term, medium term and into the longer term. I hope to make that available once we have all that together. There is a lot of work going on in that regard. In respect to the other part of the question, I will pass to the deputy secretary.

Mr WHITE - Thank you minister. The dashboard, which again, as at 30 April, is available on the web, outlines the pipeline of projects we have that are effectively under way. That includes 1137 social housing dwellings.

Ms O'CONNOR - In what time frame?

Mr WHITE - These would be over the next 12 months or thereabouts. Obviously it is very hard to put a final date on some of these projects. These projects are either under construction, in the planning process, or about to start construction. I would expect that over the next 13 months most of these, if not all of these, would be completed, and certainly within the next 18 months all of these in the pipeline would be done. So 1137 social, then there are 103 homeless accommodation units and 198 supported accommodation units in the pipeline, which represents a total of 1438 units that are under way as we speak.

Mr BARNETT - I think you asked about the forward Estimates. The Budget notes that 3500 homes over the forward Estimates. I just thought I would clarify for the record in case that was not clear.

Ms O'CONNOR - Thank you, Chair. Minister, of the projected houses built over the forward Estimates, which you told the committee would be about 3500, how many of them will be owned by the state? How many will be owned by Housing Tasmania, which means they are in the permanent rental pool?

Mr BARNETT - We don't have a definite number on that but I will ask the deputy secretary to answer that.

Mr WHITE - The 3500 includes part of the 1500 being delivered now, and also the 2000 social housing dwellings that are due to be delivered between 2023-2027. They'll be either owned by the Director or the registered committee housing providers. Where we have the land available is the Director will make that available alongside capital grants, providing that under a long term lease. The properties are owned by the Director of Housing and leased for up to 40 years by the community housing providers as social housing. Where those providers can bring land to the table, then we provide capital grants for them to construct those dwellings on land they own. For example, Centrecare Evolve Housing has been able to bring land to the table from the Catholic Church or by private purchase. Until we go through the program and allocate that funding, we can't provide a split. But what I can guarantee is that all of those properties will be social housing taken and focusing on priority applicants off the housing register and certainly will be available for a minimum of 30 years, which is the minimum for projects where the community has providers bring their land to the table.

Mr BARNETT - Just to add to that it will be guided to some extent by the Housing Strategy, which is a long-term strategy and will land in the first half of next year.

Ms O'CONNOR - Thanks, Minister. I'm a bit surprised that we don't even have a percentage figure for what the policy goal is, in terms of how much is owned by the Director of Housing and how much is owned by community housing providers; given that we are talking about public funds. In the budget papers, there's a forecast for how much of the housing portfolio will be owned and/or managed by the community sector, and it jumps from 41 per cent in 2019-2020 to 56 per cent in this next financial year. There's clearly either a significant further transfer of existing Housing Tasmania stock, or taxpayers will be giving money to community housing providers to build homes which in 30-40 years time won't belong to the state.

Mr BARNETT - I think as the deputy secretary has indicated, it really depends on who owns the land and the circumstances in which we find ourselves following the environmental scan as I called it earlier in the preparation of our housing strategy, but all will be revealed. There's a lot of work going on behind the scenes to collate that data, do the analysis, and make sure we get the balance right.

Ms O'CONNOR - Minister, are you to give some guidance to the committee on what the Government's policy is in terms of maintaining and building the properties that are owned and managed by the state? That is, Housing Tasmania. Or, is the policy goal here to direct the vast bulk of the funds, whether it be new money or Commonwealth state housing debt waiver money, to the community housing sector? Which to us, would be, it's a significant transfer of public wealth for homes which in 30 or 40 years time, and most of us won't be here then, that won't necessarily be available for social and affordable? What's the policy goal here? In terms of state ownership.

Ms O'CONNOR - We've sort of outlined our policy goals in terms of capital investment, supporting affordable and social housing through to 2032. We've got goals through to 30 June next year and then goals over the forward Estimates. I'm not sure that I can give you any more specific particular details to respond to the question, and I will ask the deputy secretary, if you wanted to add to that.

Ms O'CONNOR - For clarity, the model Better Housing Futures, as I understand it well, was designed so that community housing providers could leverage off their rental income to invest in more stock, and we're talking about a significant shift here where money that's previously been dedicated to Housing Tasmania to build more stock, is now going to community providers. We're actually talking about giving community housing providers money to build homes that in 30 or 40 years time they will own, and not the state. So they'll own it, they won't pay for it. They'll own it, they'll get the rental income for it. You see how that's a significant policy shift in terms of the state's responsibility to supply social housing?

Mr BARNETT - There's been a significant policy shift in past years in terms of building a partnership with the community service sector, and I think it's been a very valuable partnership. It's one I certainly appreciate, and I thank them for being in partnership with the Government to support our vulnerable Tasmanians. I've said, and I'll just make it clear, I'm going to put a lot of emphasis on the importance of doing that environmental to work out our needs and then to address the gaps and to fulfil the opportunities that we're going to have.

Ms O'CONNOR - But some clarity on the policy in terms of who owns the homes.

Mr BARNETT - We're getting there. We're getting to that position. We're going to have a lot more clarity, and when that strategy lands in the first quarter or first half of next year, you will see a long-term strategy with a great amount of clarity, and I hope that will assist.

Ms O'CONNOR - Just the last question. Will all of the new homes that are built be owned by the Director of Housing, whether they're managed by the community housing providers or not?

Mr WHITE - Again, I can't give you a straight answer to that because we've yet to run the processes, but based on the experience we've had, I would say that at least half or more of the homes would be continued to be owned by the Director of Housing. We have land acquisition we're doing. And where we're purchasing land for development of social housing, those properties will be retained and owned by the director and provided under long-term lease to the community housing providers. The community housing providers have been very important for us in order to obtain that leverage, as you mentioned before. Essentially up to now, we've almost been getting close to double the supply of new social housing through the leverage they can achieve through both debt and using their cash flows and balance sheets to do that.

If some providers come with land on the table from a church or whatever it is, we would welcome that, because it's adding to that new supply, and it obviously means we don't have to purchase the land ourselves. It's also worth noting too that the housing providers we're working with are all nationally registered under the national regulatory system, and that requires them to use those assets not just beyond 30, 40 years under the agreements we have, but as long as they are existing, and obviously like we do, there are asset management challenges and things you have, but they've got to use those assets for provision of social and affordable housing in perpetuity.