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NRAS cut to fund flood response

By Yasmin Noone

Not-for profit providers have joined forces with consumers to tell Prime Minister Julia Gillard that they will not accept her recently announced floods response package, featuring a dramatic cut in the National Rental Affordability Scheme (NRAS).

The Older Persons Affordable Housing Alliance —a partnership between Aged and Community Services Australia (ACSA) and the Council on the Ageing (COTA) – have heavily criticized the government’s plan to cut 15,000 dwellings from the NRAS target of 50,000.

Chief executive of COTA Australia, Ian Yates, and acting CEO of ACSA, Pat Sparrow, said NRAS was implemented to provide affordable housing options for those with limited means, including older people.

“We acknowledge the rebuilding in states affected by natural disasters must be a priority but it should not exacerbate an already critical housing shortage,” they said.

Mr Yates expressed his shock at the announcement which would leave the already vulnerable, more so.

“We see NRAS as an important initiative and to cut it back is like cutting off your nose to spite your face,” Mr Yates said

“If you cut the program then there is nothing in forward estimates to say, bring them back.”

Ms Sparrow said: “Aged are providers have some low-priced accommodation to provide but… we are already in danger of loosing that stock so this decision just compounds the problem.

“This decision has not been thought through and the simple thing is to cut rather than solve the current crisis which we all acknowledge. Cutting back NRAS is not the only way to meet the challenge [of responding to the floods].”

Instead, the Alliance says that it supports a more “strategic approach” to defer the investment in the 15,000 outstanding dwellings until the budget is returned to surplus in 2013.

“These suggestions were made by the government as part of an overall package,” said Mr Yates. “It frankly shows a lack of imagination. We suggested a constructive approach to deal with a short-term problem and it amuses me that they didn’t think of it themselves.”

Both the PM and the federal housing minister will receive a letter in the mail from the Alliance, urging them to reconsider the decision.

The Australian Greens, the Australian Council of Social Service, National Shelter, the National Affordable Housing Summit, the Housing Industry Association, the Community Housing Federation of Australia, the Combined Pensioners and Superannuants Association and former ANZ chief economist Saul Eslake have also condemned the cut.

The NRAS was a $1 billion incentives program designed to stimulate the construction of up to 50,000 homes and apartments providing affordable private rental properties. The Scheme will now be reduced to $264 million and capped by the government at 35,000 incentive packages by 2013-14.

Greens housing spokesperson, Senator for Western Australia Scott Ludlam, said cutting funding to a housing relief program to finance flood relief “defies belief”.

“In order to save $264 million, the Government plans to cut 15,000 potential homes from the program,” said Senator Ludlam. “While $264 million only represents 4.7 per cent of the projected reconstruction costs in Queensland, it is 26.4 per cent of the entire NRAS budget.”

Senator Ludlam said the notion that a housing relief program should be among those slashed to fund flood aid and reconstruction made no sense whatsoever.

“Deferring the top end corporate tax cuts planned for July 1 2013, while keeping the tax cuts for small business, would net the government about $1.7 billion in the forward estimates – that is more than six times the amount to be cut from NRAS.”

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