In politics, optics are everything.
It’s why when the Victorian government unveiled its housing statement – an ambitious policy that it says will reshape the state by delivering 800,0000 homes over the next decade – it did so alongside the building and property sectors.
Joining premier Daniel Andrews and five of his ministers at Wednesday’s announcement were representatives from the Housing Industry Association, Master Builders, the Property Council and the Urban Development Institute of Australia. Then they all posed for photos as they signed a novelty-sized copy of an “affordability partnership”.
The industry support for the government was a complete 180 degree turn. About 18 months ago the same groups were able to kibosh a plan to introduce a levy on developers to pay for social housing in record speed.
So, what changed?
Critics say the government has scrapped the rulebook for developers. Under the housing statement, it will be easier for developers to bypass opposition from local government and community groups, and build taller and denser apartments and renovate homes. Why wouldn’t those groups support that?
Others would argue the deal is actually better than the 1.75% social housing levy proposed last year.
Instead of taking in all developments with three or more dwellings or lot subdivisions – affecting first home buyers and those buying new builds in outer suburbs (ie: plenty of Labor voters) – the new plan affects developments worth more than $50m in Melbourne ($15m in regional Victoria).
In exchange for faster planning approvals on these projects, developers must allocate at least 10% of units to affordable housing. If they don’t want to, they must give at least 3% of their build’s total value to the government agency Homes Victoria and it will then be spent on social housing.
Revenue from a 7.5% levy on short-stay accommodation such as Airbnb will also be funnelled into Homes Victoria.
Both initiatives provide a boost to social housing that is desperately needed as the state’s waitlist continues to grow. Not to mention few Victorians have sympathy for the developers and holiday-home owners affected. Other governments are aware of this and are considering following suit.
Many young people may also be thrilled about the possibility of more affordable places to live, close to train stations and work. Maybe – as more supply slowly enters the market – buying their own home could be back within reach.
But in making a deal with developers, the government has made it harder on itself to strike another in parliament to ensure all parts of the housing statement become a reality.
The Greens hold the balance of power in the upper house. They are also outraged by a component of the housing statement that will see Melbourne’s 44 public housing towers demolished and rebuilt.
Andrews described the plan as the biggest urban renewal project Australia has ever seen, saying the towers were “out-of-date” and “crumbling”, with the new developments set to increase the number of dwellings across the publicly owned sites from 10,000 to 30,000.
But of the 30,000 proposed new dwellings, only 11,000 will be available to public housing tenants. The remaining 19,000 will be “a mixture of social and market housing”. That mix remains unclear.
In a letter to the premier from a group of Greens politicians – including the party’s state leader, Samantha Ratnam, and its federal leader, Melbourne MP Adam Bandt – they described this as “the biggest privatisation agenda since Jeff Kennett”.
Their final line of the letter was clear – tell us what the redevelopment will look like or we won’t support it.
“Some of the government’s housing agenda requires legislation, in which the Victorian Greens may be in the balance of power,” they wrote.
Andrews has preempted a battle with the Greens – having a crack at the minor party in the lead up to the statement’s release and in the days since. In response to their letter, he accused the party of a “shameful and dishonest misinformation campaign - scaring residents as a political stunt”.
On Thursday, he questioned how the minor party would fund a rebuild of the towers without support from the private sector.
“In the magic money world that they live in, like what does it cost to redevelop those precincts? It costs an enormous amount of money,” Andrews told reporters. “And if you don’t have a partnership with the private sector, where will that money come from?
“We can get a mix of housing, a mix of different families living together side by side, in wonderful neighbourhoods. Isn’t that what we want?”
It’s an aspiration that could become a key part of Andrews’ legacy if it can be pulled off. But the process must be undertaken with great care.
Six academics from RMIT’s Centre for Urban Research on Thursday night released a joint paper detailing the harmful effects of the displacement of the buildings’ current residents on health, wellbeing, social connection and life opportunity.
“Displacement of low-income communities is known internationally to cause serious harm and death,” they wrote.
Many of the residents who will be displaced during the redevelopments were also forced into a sudden Covid-19 lockdown in 2020, which the Victorian ombudsman found breached their human rights. The government has repeatedly refused to apologise to the residents, but earlier this year settled a class action with a collective $5m payout.
It appears to have learned its lesson this time, with department staff and translators beginning their work to inform residents of the redevelopments on Wednesday. This must continue.
But in any event it is hard to see how the Greens and Labor will resolve their differences on the issue, which could be an opportunity for the Coalition to leverage a rare political win.
Unsurprisingly, the opposition also aren’t fans of aspects of the housing statement – including stripping councils of their planning powers – but unlike the Greens, they tend to prefer to keep the property industry on side.
