With the Coalition leaving office with a trillion dollars of government debt and nothing to show for it hanging over our heads, no one can deny Australia is in a financial dilemma. There is an immediate pressing problem of affordable and social housing in this country. How best to deal with the housing problem? One effective method, that is sustainable and does not place an additional burden on taxpayers is a Government operated 'Future Fund' with the specific aim of providing affordable and social housing for those Australians locked out of the existing private markets for home ownership and rental accommodation. How does a Future Fund work, simply the government establishes a monetary fund, in our case through taking advantage of low interest rates due to our excellent international credit rating. Then that money can be invested at good returns, providing economic development within Australia, mining, manufacturing a limitless amount of opportunists exist. The net return after all costs have been met by the Future Fund is then used to provide affordable housing for eventually millions of Australians who are being denied that oppertunity at present. Talk of a $100 billion is not unreasonable. MR DUTTON WHAT IS YOUR PROBLEM?

Dear Paul,

What you suggest can be classified as gambling.

It may succeed - but it may crash, there may be initially some good returns, then comes a pandemic or a war, earthquake, floods or fires and bang, the capital is lost, but the extra debt remains (and interest rates are not anymore low, even with the best credit rating).

Houses are not created out of thin air by shuffling numbers, they need to be physically built.

Here is my suggestion:

By reducing regulations, people should be allowed to build their own homes, without the middleman in the form of banks and building companies.

First stop restricting where and what people can build, especially in rural land, so poor people can start building their own shacks there with their own hands, a room at a time, and as they save on rent they can gradually afford to build more rooms, bring in running water and electricity and eventually end up with a decent home completely their own.

Apart from that, if we can manage to reduce the overall population, then there won't even be a need for new buildings because as people die, their homes will become available for others.

Hi Yuyutsu,
"Apart from that, if we can manage to reduce the overall population, then there won't even be a need for new buildings because as people die, their homes will become available for others."

I can see a problem here with your line of thinking.
I think banks would buy up any spare houses and either put them on airbnb at a high rental rate or leave them empty just to ensure a shortage of available dwellings on the market and maintain high prices.

As for how to fix housing, I always said I believe the answer is huge big factories assembling relocatable homes on a production line.
Use ready-made ready-to-assemble cheap imported components, that can be assembled using people on a work for the dole program, and who get paid double dole for full time work.
These people can learn their tasks via an app / prove their skills via a digital resume and who confirm their shifts via the mygov app.

Cut all costs;
Cut component costs, training costs, employment hiring costs and wage costs.

Arrange them like caravan parks, in low density areas with a mini bus service (People can have food delivered these days) and sell the land off and move them further out of urban areas every 10 years or so, that way the government will get a return on the land, so that they can buy more land further out.

Finally, start cracking down on people in government housing who cause problems in their neighbourhoods and damage the houses they're given.
Ban them for 5 years, and after that allow them to reapply, but put them on the bottom of the list with no priority.

Dear Paul,

There's an interesting article from the Grattan Institute
agreeing with your take on this subject. The federal government
should establish a social housing future fund.

The article tells us that the previous Morrison government
made it clear that it regarded social housing as the
responsibility of state governments. Yet the history of
Australia's federation shows that large social programs
from Medicare to post-WW2 expansion of social housing will
only succeed with federal support. This reflects the
imbalance that for every 5 dollars in taxes levied each
year the federal government collects four dollars and the
states only one.

There's more at the following:

http://www.grattan.edu.au/news/a-plan-to-call-home-its-time-for-a-social-housing-future-fund/

Paul,

In Norway the government set up the Government Pension Fund Global (GPFG) so that the wealth benefits generated from they natural resources would provide benefits for both current and future generations.

The first money transfers to the fund took place in 1996.

In 2010, just 14 years later, Prime Minister Rudd proposed a "super profits" tax on the mining industry.

This was one of the major causes of his downfall.

In 2010 the GPFG had a market value of 3.077 billion kroner.

In 2022 the GPFD had a market value of 12.429 billion kroner.

Talk about lost opportunities.

Paul,

I used the European metric notation in those figures.

We would tend to write these figures as 3,077 billion and 12,429 billion.

Those who think it's a good idea should watch this episode of Utopia:
http://iview.abc.net.au/programs/utopia/CO1811V008S00

Dear Critic,

«I can see a problem here with your line of thinking.
I think banks would buy up any spare houses and either put them on airbnb at a high rental rate or leave them empty just to ensure a shortage of available dwellings on the market and maintain high prices.»

Buying houses and keeping them empty is a very expensive exercise, even for a bank. Apart from the cost of purchase itself they would have to pay land tax, maintenance and council rates, possibly even an extra tax for keeping the houses unoccupied. Further, house values will decline, both because the houses depreciate as they get older and because the overall population declines. Empty houses are also prone to invasion by pigeons, mice, possums and ants, which depreciate their value even faster.

Paul,

With Labor's $trillion debt growing every day, how on earth are they going to build a future fund when all they are building is future debt?

The only option they have is more taxes.

SM,

Who said anything about increasing taxes, other than you and Dud Dutton. A Future Fund operates by taking advantage of Australia's favourable credit status, some refer to a 'AAA' rating, to borrow at a lower cost, and invest for a higher return. All investments have a risk attached, and Future Funds are no different, but the benefits are worthwhile. Dutton was part of a government that had a pair of drunken sailors, ScumO' and Friedbrain go out and raid the vaults of world banks, and then splash billions around to their mates down at the big end of town, like Gerry Harvey, $12 million for Gerry, at better than Gerry's 5 years interest free, it was just free money for Gerry. That's just one small example of the nothing to show for it borrowing panic of the previous government. What Labor are proposing is modest and sustainable with a useful return.

As the ad says; 'Compare the Pair', same age, same starting balance, one borrowed billions and blew it on wine, women and song, that's ScumO', the other borrowed billions and invested in bricks and mortar, that's Albo. Today ScumO' wakes up in the gutter with an almighty headache getting ready for the drop kick from parliament, whilst Albo is now PM, leading Australia to a brighter better future.

Rex Connor all over again...
http://en.wikipedia.org/wiki/Loans_affair

The one thing we can say with certainty about the left is that no matter how often a hair-brained scheme fails, there'll always be some dunce campaigning to try it again.

Paul,

You greens are a complete joke financially. Your plan is to borrow a ton of cash to increase Labor's $trillion debt to $ 2 trillion and reinvest it.

The first thing that happens is that our AAA rating achieved by the coalition drops into the crapper and our cost of borrowing shoots up, next we have the pin economic pinhead Chalmers lose his shirt with crappy investments, next, we have airbus Albozo and Bum Bandit blowing the lot on idiot investments like the school halls debacle pushing inflation through the roof.

Letting left whingers look after a pile of money is like using a fox to guard chickens.

Hi Yuyutsu,
"Buying houses and keeping them empty is a very expensive exercise, even for a bank. Apart from the cost of purchase itself they would have to pay land tax, maintenance and council rates, possibly even an extra tax for keeping the houses unoccupied. Further, house values will decline, both because the houses depreciate as they get older and because the overall population declines. Empty houses are also prone to invasion by pigeons, mice, possums and ants, which depreciate their value even faster."

Yes granted keeping houses permanently empty is a loss with no return, including a rates and maintenence liability, but I disagree with you that house prices will decline given the current status quo.

Given our country no longer has a manufacturing base, the government relies on immigration which leads to housing demand, to create jobs.
So the government has a vested interest in immigration to keep people in existing jobs employed.

And my argument isn't without merit, if you put those empty houses on airbnb, because if you can't find a house to rent, or want to go on a holiday then the lack of a housing supply creates a higher demand for airbnb, and all you have to do is rent out an airbnb one or two days a week to cover your costs which makes it profitable enough for the banks to do so.
They could have 10,000 houses or units on their books which are only rented out on average one or two days a week, to still get a return while at the same time maintaining a housing shortage that would in turn create demand for more houses and loans for them.
While the government at the same time maintains immigration which also helps create a shortage and more demand for new homes and helps maintain employment.

Finally, the population isn't in decline, it's increasing.

Hey shadowminister,
"You greens are a complete joke financially. Your plan is to borrow a ton of cash to increase Labor's $trillion debt to $ 2 trillion and reinvest it."

That wouldn't be a bad idea if the government showed proficiency in financial and business management, but sadly we both know they don't.
Their proficiency is in wasting money at such a level that any real business would surely go broke.

If they could show proficiency in running businesses well, benefiting both workers and consumers and maintaining profitability, they wouldn't have resorted to privitisation and sold everything off.

And if they could show proficiency in their investments, then the country wouldn't be in a trillion dollars of debt.

If you run a business into a trillion dollars of debt, you've run it into the ground.
Comparing debt to GDP might be a valid way of financial management.
- But it's still based upon increasing debt, which means that the government spends more than it receives and creates inflation which is another form of tax.

Yes Yuyutsu, first we need to free up land subdivision to bring prices down, the restriction of development is forcing ridiculous prices. Yarrabilba little postage stamp size blocks have gone from under $100,000 to $288,000 currently in just a very few years.

The local council here is fighting viciously to prevent me splitting a single housing block off my 20 acres to give to a daughter. Unless she owns the block she can't raise the money to build.

They also resist granny flats. Some are exploiting vague laws about "mobile" units, while many are simply adding various units or sheds for family who can't afford to own their own. Currently council is doing nothing about the proliferation of illegal units. Perhaps councilors & bureaucrats understand they will be torn to shreds in the press & possibly in the street, if they start chucking the often single mothers living in these units out to homelessness.

When tastefully done no one is complaining. We all realise that but for the grace of god there go we.

In the 50s we were among about 100 families on a back road at Bathurst living in sheds while we built homes. The problem then was not only money, but building materials, which were just not available in an volume after the war. Councils were not so bad in those days. Our dirt floored shed was clad in flattened out 4 gallon kerosene tins, as were many others. We spent 2 very cold winters in it but we finally got that house.

prevent me splitting a single housing block off my 20 acres

Hasbeen,
Those Billy Goat Show Councils have mostly no common sense reason for such refusals.
They're simply too stupid & incompetent in their stuffing people around.
Like changing a Form 43 to a Form 16, for a reason no-one can provide an explanation.
Many competent Councils are under the incompetent thumb of Local Government. It's all about getting the snouts of bureaudroids into the troughs.

Dear Critic,

I was under the impression that your concern that the banks might abuse the situation and purchase houses deliberately to induce scarcity was in reply to my first post here.

If people are allowed to build their own shacks (my first suggestion) then there will be more housing altogether and if we manage to lower the population (my second suggestion) then there will be less demand for houses.

The banks can do what you suggested already (and government is likely to respond by heavily taxing them out of it), but I cannot see how my two suggestions can help them to exploit the market with your proposed sinister scheme further than they can already: can you please explain how you think it possible?

Surely the banks wouldn't like my proposals, but what can they possibly do other than roll over belly up?

Hi Yuyutsu,

"I was under the impression that your concern that the banks might abuse the situation and purchase houses deliberately to induce scarcity was in reply to my first post here."

Ah yeah, I can see the reason for the semi-miscommunication, when I said I didn't think the population will reduce.

I don't think your first idea is necessarily a bad idea.
But governments would carry on about building codes etc.
- My other suggestion would be to just put a slab down and put a double garage shed on it. It may not be perfect but it could still be liveable until people can afford something better.
This would be much better than a tent, a car or homeless in the street - with neither a tent or a car.

"The banks can do what you suggested already (and government is likely to respond by heavily taxing them out of it)"

I guess I could see the government cracking down on it if it went too far, but I'm not sure they could easily regulate what people charge for Airbnb

"I cannot see how my two suggestions can help them to exploit the market with your proposed sinister scheme further than they can already: can you please explain how you think it possible?"

I also can't see how the banks could exploit your ideas, but neither can see local councils giving the ok to what may effectively become shanty towns.
- But I'm not necessarily opposed to your idea.
Anything is better than a tent, a car or homeless in the street - with neither a tent or a car.

SM,

"You greens are a complete joke financially." The Greens are not the party that ran up a trillion dollars of debt! It was all the work of that pair of drunken sailors, ScumO' Morrison and his sidekick Friedbrain. Just this afternoon Matt Canavan LNP, who I normally consider a complete jerkoff, got it right when his said the Coalition panicked and ran up an unnecessary amount of debt while in office. For years you tried to blame Labor for their modest debt created, so take your medicine now!

A Future Fund is a great idea to bankroll affordable and social housing in this country. Dutton like Morrison before him, has no idea.

Hassy,

For you wearing your spats and straw hat, its still the 50's, the 1850's that is! I can't see why you should own 20 acres of once productive land that you have now turned into a 'Sahara sand hill' and still get a pension from us taxpayers, its outrageous. I think your land should be given over to a productive refugee family for goat farming! With a small dog box size granny flat for you to live in, down in the back corner. Great idea don't you think?

All my life I've tried for people to see that the only way for the elderly is a Govt run Pension fund into which everyone contributes.
Superannuation is for those who can afford to pay into without Govt or employer contribution.
That would do away with funds going awol via corruption or incompetence. Add to this Public service salary ceilings & there wouldn't be this insidious manipulation of inflation ! The whole nation would benefit !

The only reason that the Gangreens haven't incurred any of Labor's $1Trillion debt is that even the most idiotic voter wouldn't be stupid enough to give the morons such as Syph HY and bum bandit access to any real power.

The Gangreens are like yapping dogs whose only function is to annoy and crap on the rug.

Watching a program on Franklin Roosevelt, 1930's, he and later Eisenhower 1950's adopted their versions of future funds to build American infrastructure. Who should we take notice of, Roosevelt and Eisenhower, or that dopey Mr Potato Head masquerading as Opposition leader in Canberra. Its a no brainier

American infrastructure...
Have you heard about the Ohio train derailment?
Supposedly the biggest environmental disaster in US history?

Check this out - First lets identify the locomotive - 1603

The longest train on the ricketiest rail PREX 1603 on the ND&W Railroad
http://youtu.be/uOoDY6jHgNM
Description - PREX 1603 leads a ND&W train on the former Maumee and Western tracks in the area of Antwerp Ohio

Now look at this - same Locomotive 1603 - Unbelievable.
http://twitter.com/Kanthan2030/status/1626186916235481094

Quick - Send money to Ukraine!

Meanwhile...
China takes rail transport to a new level
- Freight trains running at 350 km/h
http://www.cargo-partner.com/trendletter/issue-25/highspeedrail-freight-in-china

350 km/h high-speed freight train launched in north China
http://youtu.be/MuHfczRFpFQ

America is not the greatest country in the world.
It's not building it's nation, it's leaders are focussed on warmongering.

" Franklin Roosevelt, 1930's, he and later Eisenhower 1950's adopted their versions of future funds to build American infrastructure. "

Rubbish. They certainly built infrastructure but not by using a 'future fund' model. They just built it. Roosevelt during a depression as a way to provide work. Eisenhower to just spend money when the US was proportionately the richest nation the world had ever seen and wanted to provide work to those at home and struggling allies.

"Who should we take notice of,"

I think we need to follow the unbelievably successful future fund model of Rex Connor.

AC,

The dictators love their show pieces. The trains are a technical marvel just a pity that they are losing vast amounts of money with some lines not even covering their running costs let alone the maintenance and capital costs.

The train speed technology available is not in synch with cost recovery ! Is there really such a need for that much speed ?
Just because it is technically possible is not enough reason to build it when the majority of people are struggling to house & feed themselves.
As great as much of technology is, there is more than enough evidence that a huge part of it is actually detrimental to society.

mehaze,

You say "rubbish" but as usual provide no evidence. Roosevelt's 'New Deal';

"At the center of Roosevelt's New Deal was the Reconstruction Finance Corporation (RFC), an independent agency within the federal government that set up lending systems to channel private capital into publicly desirable investments." Eisenhower's National Highways, was similar, private investment was channelled into publicly owned works, with government guarantees.

"The Eisenhower administration proposed financing the interstate highway system (Federal Highways Act) through a federal bond issue, and State and local input."

As I said both, Franklin Roosevelt, 1930's, he and later Eisenhower 1950's adopted their versions of future funds to build American infrastructure. "

But but ....they weren't FUTURE funds. They got the money and spent it.

The overriding feature of the FUTURE fund is to get the money, invest it and spend the profits LATER. They are very different ideas as compared to what Roosevelt did. The problem with the future fund notion is the expectation that there will be profits. Remember, we are talking about government here. Generating profits isn't their defining feature, to say the least.

mhaze,

Say what you like with your anti Labor bias, but the fair minded can see the benefits of borrowing and investing, using our AAA credit rating to our advantage, then investing the surplus profits into worthwhile social benefits. The fact is the incompetent Coalition left us with two problems, one a woefully inadequate housing situation, backed up by two, a trillion dollars of debt, with nothing to show for it. Labor is trying to tackle both without increasing Australia's debt situation. The key is unlike the Coalition debt this is not a burden on the taxpayer.

What do you suggest the government should do?

Paul,

Borrowing a shedload of money to build social housing will have the benefit of creating social housing. However, as social housing will not yield financial returns, this would be a crappy investment for any future fund.

The real downside would be that this would pour petrol on the inflation fire and push interest rates even higher. This could also cost Aus its AAA investment rating that the coalition got after years of effort.

In all this is yet another tax/borrow and spend stupid idea.

I'd be quite happy to support the government borrowing further if it creates an economically sensible plan to solve the problem.
But I won't support the government wasting billions of dollars on ill-thought out plans that ultimately achieves little to nothing.

As stated previously -

"As for how to fix housing, I always said I believe the answer is huge big factories assembling relocatable homes on a production lines.
Use ready-made ready-to-assemble cheap imported components, that can be assembled using people on a work for the dole program, and who get paid double dole for full time work.
These people can learn their tasks via an app / prove their skills via a digital resume and who confirm their shifts via the mygov app.

Cut all costs;
Cut component costs, training costs, employment hiring costs and wage costs.

Arrange them like caravan parks, in low density areas with a accessible bus service (People can have food delivered these days) and sell the land off and move them further out of urban areas every 10 years or so, that way the government will get a return on the land, so that they can continue to buy more land further out as urban areas grow."

Has anyone else got a better more cost effective and more realistic plan?

Hi AC,

Good suggestions, there is a danger of government simply throwing money at a problem, without a real plan to achieve the objective. They need smart people involved, and I don't mean bureaucrats, people from within the housing and fiance industries. If you go to Sydney and catch the train, as it passes through Wolli Creek, take one look at the urban disaster private developers have created there. Looks spoofy when new, but give it 20 or 30 years and it will look like the worst of the worst council estates in Britain in the 70's. WE DON'T WANT THAT FOR BRISBANE, but its coming our way.

BTW where's the caravan park out your way? Friends said they are staying there.

Whatever happened to young people getting an old house & doing it up or getting a block of land & build a small home instead getting into 50 year mortgages to move into a 700 Grand home ?
Is it any wonder that developers, builders & real estate agents were able to get on the best roll in history with young people like this last generation ?
To want it all up front literally translates into forfeit of future !

One tiny suggestion of self-control & responsibility & the thread is dead !