Contract_house
  • Home
  • Analysis
  • News
  • Productivity Commission releases extensive review of the National Housing and Homelessness Agreement (NHHA)
BACK TO news
Share
news

Productivity Commission releases extensive review of the National Housing and Homelessness Agreement (NHHA)

07 Oct 2022

The Productivity Commission’s newly released review on the National Housing and Homelessness Agreement (NHHA) has found the Agreement to be ‘ineffective’ and that there should be focus on ‘improving the affordability of the private rental market and the targeting of housing assistance’. As such, the Commission considers that the NHHA ‘should be expanded to include all government-provided housing assistance including Commonwealth Rent Assistance and first home buyer assistance.’ This finding, together with many of the recommendations in the report, is consistent with AHURI’s submission and advice to the review. 

The review has used its wide-ranging terms of reference to question many aspects of Australia’s housing system, particularly in light of the potential for developing a far-reaching National Housing and Homelessness Plan. 

The Productivity Commission is supporting the creation of such a Plan with the remit to cover the particulars of housing for people on lower incomes in Australia: from homelessness to social housing, to private rental and to home ownership, and also include aspects of the housing supply/construction industry.

The Productivity Commission also identifies that a lack of evaluation of projects and targets attached to the NHHA is both restricting the most effective use of government resources and preventing knowledge of what’s working best being communicated to other jurisdictions.

The NHHA review makes over 35 recommendations, many of which are important for the NHHA going forward. In particular, AHURI notes a number of key recommendations including:

  • The next NHHA should include (Recommendation 5.1) a better-defined objective, with key terms defined and trade-offs articulated; a broader scope; and clarify all roles and responsibilities. Outcomes should be focused on improving outcomes for people across all tenure types, with a performance monitoring and reporting framework with annual reporting.
  • The NHHA should cover all government-provided housing assistance, (Recommendation 5.3) including: Commonwealth Rent Assistance; Australian, State and Territory Government home buyer assistance; State and Territory Government private rental assistance; Australian Government homelessness services; subsidies for affordable rental housing, including key worker housing; and the announced Housing Australia Future Fund.
  • Australian Government funding should be allocated across jurisdictions according to need and the cost of providing services, with a new model for determining the distribution of funds across jurisdictions. (Recommendation 5.5)
  • The Australian, State and Territory Governments should develop a new performance monitoring and reporting framework (Recommendation 5.6) for the NHHA and the National Plan, including having an independent body responsible for monitoring and reporting progress.
  • A council made up of housing and homelessness ministers from each jurisdiction should oversee the NHHA and the National Plan. (Recommendation 5.7)
  • State and Territory Governments should commit to reforming contract arrangements for specialist homelessness services (Recommendation 6.4) and trial flexible funding that allows services to provide a range of supports to meet people’s needs, for however long they are needed.
  • The Australian, State and Territory Governments should trial portable rental assistance based on need (Recommendation 7.1). This will involve extending Commonwealth Rent Assistance to public housing tenants, removing income-based rent settings in social housing and designing a high-needs based housing subsidy to ensure housing is affordable and tenancies can be sustained. 
  • Commonwealth Rent Assistance should be within the scope of the NHHA (Recommendation 9.3) and be reviewed (Recommendation 9.2) to assess all aspects of the payment.
  • Governments should phase out assistance to first home buyers through grants and stamp duty concessions, unless measures are tightly targeted to support people experiencing marginalisation in the market and who would otherwise be locked out of home ownership (Recommendation 10.1). State and Territory Governments should use the phasing out of stamp duty concessions as a stepping stone to replace stamp duties on residential properties with a broadbased land tax.
  • State, Territory and local governments should revise their planning regulations to promote greater housing density and diversity (Recommendation 13.2).
  • The NHHA should acknowledge the importance of housing supply as a long-term solution to housing affordability and include a requirement for States and Territories to commit to transparent housing targets and regularly reporting on progress (Recommendation 13.4).

AHURI is very pleased the review has identified many aspects of the NHHA that can be significantly improved and made good recommendations to that effect. There are, however, a number of issues where the review is less effective, such as, for example, strongly promoting the portability of housing assistance which assumes that adequate private rental market housing is available for those who have special needs, such as housing appropriate for people with a physical or mental disability or for people on very low incomes. As there are increasing numbers of people with these characteristics (through population increase) this means there will continue to be an ongoing reliance on the increased supply of state funded, supported social housing dwellings that are independent of the private rental market.

AHURI’s submission (number 52) to the Productivity Commission’s review is available online.