Labor has guaranteed a minimum of $500m will be paid out of the Housing Australia Future Fund every year in a last-ditch bid to win Greens support for the bill to help build social and affordable housing.
The housing minister, Julie Collins, wrote to the crossbench on Monday offering a “guaranteed fixed disbursement” of $500m from 2024-25, with a new power for the treasurer and finance minister to increase the amount by regulation, making it a floor not a ceiling.
But the offer, made before the Greens party room meeting on Tuesday, still falls short of the minor party’s calls for up to $2.5bn of direct spending on housing and extra funds to incentivise the states to freeze rents.
The Greens housing spokesperson, Max Chandler-Mather, immediately poured cold water on Labor’s offer, saying it had “done nothing more than partly close a loophole that could have seen no money spent on housing at all”.
“What Labor is offering is a housing plan that won’t spend money until 2024-25 then locks real-term cuts for six years and does nothing for renters,” he said. “What we need is billions of dollars of investment in public and affordable housing immediately and an emergency freeze on rent increases.”
After voting with the Coalition to prevent the bill coming to a final vote in May, the Greens now have a final parliamentary sitting fortnight to decide whether to back the bill before the future fund’s intended start date of 1 July.
Labor has won support from state and territory housing ministers, the Jacqui Lambie Network and senator David Pocock for the bill, despite Pocock, the construction union and some housing groups backing calls for it to lift its ambition.
In her letter, seen by Guardian Australia, Collins said the Albanese government had provided “long overdue national leadership on renters’ rights” by putting it on the agenda at national cabinet.
She added that the budget had increased the maximum rate of commonwealth rent assistance by 15%, set to help about 1.1 million people.
Collins implicitly rejected claims the Greens have made publicly that the government has not invested directly in new housing, saying $575m would be allocated from the national housing infrastructure facility for social and affordable homes, as would $350m through the national housing accord for 10,000 new affordable rental homes.
Collins cited other concessions to the crossbench including: indexation of payouts from the Housing Australia Future Fund from 2029; a review to be completed by December 2026; energy efficiency standards in new homes; and $200m from the fund for the repair, maintenance and improvement of housing in remote Indigenous communities.
Collins said Housing Australia “has already begun preparatory work” meaning work can begin “immediately” as soon as the fund is established, with contracts to be signed in the 2023-24 financial year.
“However, recognising the reality that homes take time to build, any further delay will mean people in need will wait longer for the homes the Housing Australia Future Fund will provide, including women and children fleeing domestic and family violence and older women at risk of homelessness.”
Earlier in June the Greens scaled back their demands but have still been pushing for interim direct spending on housing rather than waiting for returns from the future fund, which Chandler-Mather argues could mean no houses are built before 2025.
“The Greens want to negotiate, but Labor is refusing to shift on the two key demands we’ve made clear for the last eight months, more guaranteed money for public housing and a nationally coordinated freeze on rent increases,” he said.
