A housing scheme devised by former prime minister Kevin Rudd provided developers with $1 billion of windfall gains and failed to help low-income renters, Grattan Institute research has claimed.
The National Rental Affordability Scheme (NRAS), which was established by Mr Rudd in 2008 and began winding down last year, aimed to increase the supply of affordable housing by paying developers and housing organisations to lease units for below-market rent.
But, according to Grattan, the scheme failed to boost supply and was little more than a developer handout.1
A more effective government strategy would be to “build more social, rather than affordable housing, and target it at people at serious risk of becoming homeless”.
“Because someone who is at a very serious risk of homelessness will typically need a much larger subsidy – the kind of subsidy that social housing is going to give them,” Grattan researcher Brendan Coates told The New Daily.
- 1. Initially set at $8000 a year, the subsidy developers received eventually rose to $11,000 a year, which is much greater than the 20 per cent rental discount offered to tenants. Grattan researchers said the discount should have only cost $3692 a year