The Federal Government has spared the National Rental Affordability Scheme (NRAS) from drastic cuts following negotiations with the Green Party.
The Government had proposed to wind back the NRAS scheme from 50,000 homes to 35,000 in order to free up $264m to pay for flood relief efforts.
But during the course of negotiations with the Green Party over supporting the new flood levy, the Government agreed to stick to its original 50,000 home target, instead opting to defer spending the final $264m until 2015 as proposed by industry groups.
“In negotiating support for the flood levy, the Greens have secured an agreement from the Government to reaffirm its commitment to NRAS, retain a target of at least 50,000 new residences and extend the program to allow orderly progress of the project delivery. We believe reinstating this program would be a great outcome for the many Australians who are in dire need of more affordable rental housing,” said Housing Industry Association chief executive Graham Wolfe.
The Real Estate Institute of Australia (REIA) was also quick to praise the restoration of NRAS targets, pointing out that – even before the floods – the demand-supply gap was forecasted by the Housing Supply Council to increase by more than 50% between 2010 and 2014, rising from just over 200,000 dwellings to more than 300,000.
“The industry was aware that the Government needed to cut expenditure to assist in the re-building effort so as not to place pressure on interest rates, however REIA made it clear that the choice of programs targeted was questionable – the NRAS is an essential part of the solution to relieving the affordable housing crisis in Australia,” said Real Estate Institute of Australia (REIA) President David Airey.
“One of the greatest needs following the floods will be affordable housing - the longer-term goals of the NRAS may now have the opportunity to be realised.”
