AHURI NEWS

New AHURI report into competition and consumer choice in housing assistance

Increasing supply of affordable housing critical to enabling competition and consumer choice in housing assistance

31 August 2016

AHURI is pleased to release the report from its Inquiry, ‘Individualised forms of welfare provision and reform of Australia’s housing assistance system’.

The Inquiry found that, due to shortages of affordable accommodation, it is difficult for low-income households to exercise choice in the private rental market, and that competition and consumer choice in housing assistance depends on an increase in affordable housing supply.

The consumer choice model is being implemented in aged care and disability services, and the Government has asked the Productivity Commission to look at employing it across more human services. The model proposes that when welfare recipients are given ‘choices’ it leads to better outcomes as organisations compete to deliver greater choice and more responsive services while recipients develop self-reliance.

Professor Keith Jacobs, who led the Inquiry, said, ‘The supply of affordable housing could be increased by Government offering bonds to raise funds for community housing providers; shared equity schemes that encourage first-time buyers to buy a proportion of a property; and a new affordable finance institution (similar to the UK’s Housing Corporation) to lend funds to community housing providers for new building programs. In addition, the transfer of public housing dwellings to community housing providers can give households choice in that there is a diversity in providers and management styles.’

The Inquiry also proposes strategies to implement consumer choice through creating markets (or quasi markets) for welfare services. Such markets could enable private, not-for-profit and government organisations to compete in providing different types of housing assistance. Where appropriate, housing assistance clients could have a personal budget to access the ‘bundle of assistance’ they require, such as support for those who have ongoing and complex needs. However, the Inquiry does note there are significant risks associated with consumer choice strategies and that, as a consequence, Government will have to regulate the sector and monitor service standards into the future.

The AHURI Inquiry draws on the findings from researchers from University of Tasmania, Swinburne University of Technology and The University of New South Wales, and was informed by a panel of experts from housing policy and practice.

The final report from the Inquiry is available to download from the AHURI website at http://www.ahuri.edu.au/research/final-reports/269