The Gillard-government have made their first policy announcement. A re-elected ALP government will build 15,000 houses in regional cities at a total cost of $200 million. A couple of points to make. First the ALP policy does not identify any matching spending cuts. Gillard had promised that her election spend would not add a single cent to the budget bottom-line, so we already have one broken promise.
Second it looks like they have over-promised.
The Gillard Labor Government will invest $200 million to help build up to 15,000 more affordable homes in regional cities over three years and relieve pressure on our major capital cities, so that Australia can grow sustainably.
This program will give participating councils new funding to invest in local infrastructure projects that support new housing developments, such as connecting roads, extensions to drains and sewerage pipes, and community infrastructure such as parks and community centres.
But Ms Gillard as education minister has a track record in building projects. Her BER has been a massive waste of money. 15,000 houses for a total cost of $200 million works out at about $13,333 per house. How much house can you get for about $13,333 when a covered outdoor learning area costs $954,000? But it’s not just houses at that price, infrastructure too.
Update: Jacques points to the Strategic Indigenous Housing and Infrastructure Program.
SIHIP is due to deliver 750 houses and 2500 refurbishments in 73 remote Northern Territory communities by 2013. Eleven houses have so far been completed and 81 are under construction.
Update II: Milton von Smith reckons the policy is underfunded.
If 15 regional cities will get $15 million each that works out to $225 million not $200 million.
… and in the red corner, SIHIP.
Jacques Chester
18 Jul 10 at 2:25 pm
Good spot.
Sinclair Davidson
18 Jul 10 at 2:40 pm
Don’t be so ingenuous Sinc – read the fine print!
Note particularly, the word ‘help’ ie assist.
Not much assistance but not “overpromising”!
ennui
18 Jul 10 at 2:41 pm
From memory the Victorian government wanted to charge a $15,000 infrastructure charge for new houses in new areas. I can’t remember what happened to that policy. This new policy wouldn’t even cover that.
Sinclair Davidson
18 Jul 10 at 2:47 pm
A re-elected ALP government will build 15,000 houses…
Mother of mercy, no.
What’s the body count going to be for this one?
C.L.
18 Jul 10 at 2:54 pm
Please…. What ever happens, NO insulation.
JC
18 Jul 10 at 3:06 pm
yea… that’s what I worked out a few times. Applying the same construction costs they used for the BER, they’d be lucky to get a door handle for 13G.
Who is she kidding.
JC
18 Jul 10 at 3:08 pm
Construction Watch will be set up, nothing to worry about
tal
18 Jul 10 at 3:10 pm
First the ALP policy does not identify any matching spending cuts. Gillard had promised that her election spend would not add a single cent to the budget bottom-line, so we already have one broken promise.
.
They’ll have to. If they haven’t costed this, it’s another brain fart.
Adrien
18 Jul 10 at 4:53 pm
Please…. What ever happens, NO insulation.
.
Actually you’ll like the policy. It’s a plan to get rid of long term welfare dependency. They’re getting Lurch to build the houses.
Adrien
18 Jul 10 at 4:54 pm
“The Gillard Labor Government will invest $200 million to help build up to 15,000 more affordable homes in regional cities over three years and relieve pressure on our major capital cities, so that Australia can grow sustainably. This program will give participating councils new funding to invest in local infrastructure projects that support new housing developments, such as connecting roads, extensions to drains and sewerage pipes, and community infrastructure such as parks and community centres.”
In other words, it’s nothing to do with building houses at all. It’s about building roads and things in housing developments.
So why do they mention building housing at all? It’s about laying sewerage pipes and that sort of thing.
I guess the headline of “Julia to spend $200m to help Westies get rid of their shit” doesn’t roll off the tongue that nicely.
boy on a bike
18 Jul 10 at 4:54 pm
[...] Files has a damning assessment of Gillard’s first election promise to pump $200 million into regional housing. In short, it [...]
Right Pulse » Blog Archive » Another Gillard Building Con
18 Jul 10 at 5:25 pm
More money down the drain then
Entropy
18 Jul 10 at 6:37 pm
$13k per house?
Try $672 million for ZERO houses built!
http://bovination.com/readArticle.jsp?articleID=1661838
.
18 Jul 10 at 6:37 pm
Given each SIHIP house has cost about $1 million. And that’s humpies in the desert! Just imagine how much the government would have to spend to build 15,000 houses in urban areas!?
Peter Patton
18 Jul 10 at 9:23 pm
As boy on a bike observed, this is not about houses, although violate seems to have given that impression, but utilities (excluding the NBN I presume). $13,000 per house for sewerage is a bit ripe though.
Entropy
18 Jul 10 at 9:41 pm
Now look at that: Mrs entropy’s iPhone auto corrected gillard to violate. Then it tried filleted for gillrudd.
Entropy
18 Jul 10 at 9:43 pm
In SEQ the infrastructure charges for a residential block are already quite a bit higher than $15k per block, but obviously that would help.
The roads, sewer and water to my house were paid for with Council loans repaid through rates. I think people in new suburbs get a raw deal with infrastructure taxation (as do the poor saps who need a toll road for decent transport), so I think there is an argument for more of this type of policy.
pedro
18 Jul 10 at 9:52 pm
The risk is that it just ends up in the developers’ pockets. If a person was serious about regional population growth, it avoid rent seeking behavior you would not introduce subsidies like this, especially ones that only apply to new developments. A more effective option would be zonal tax breaks. Permanent incentives. Or probably more appealing to social democrats, tax penalties for living in urban areas. In fact mix the two as linked ‘reforms’ and it would be a sneaky way of raising revenue
Entropy
18 Jul 10 at 10:07 pm
[...] Catallaxy, Sinclair Davidson points out that $200 million for 15,000 houses seems like an absolute bargain: “Her BER has been a [...]
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