Landmark BCA report calls for urgent policy action to fix housing supply crisis
21 October 2024
The Business Council has today released a new landmark report calling for significant policy changes to address Australia’s chronic housing supply crisis.
In its milestone report — It’s time to say yes to housing — the Business Council says significant changes are needed to build the 1.2 million homes required over the next five years.
The BCA has outlined 29 recommendations, including a call for a new national reform fund, to help meet the national Housing Accord target, which is currently running behind by 64,000 new homes a year.
The report recommends:
- A Federal Government established national reform fund be created to incentivise states and territories to fix housing regulation, planning and approval processes.
- Rezoning land to legalise housing in areas in demand and creating more flexible and consistent zoning rules that respond to need.
- Building more infrastructure to support new housing.
- Faster and more efficient approval process to accelerate critical developments.
- Performance management of council approval processes and giving state governments new intervention and approval powers.
- Addressing labour and materials shortages and training more workers in the skills needed to build housing.
- New approaches to community consultation and heritage management.
- Ensuring taxes and charges do not impact investment for new housing supply.
- Tackling criminal behaviour on building sites.
Business Council of Australia Chief Executive Bran Black said Australia is at a critical juncture to deliver on the homes the nation needs.
“Australia has a housing supply crisis and we need urgent action from all levels of government to fix it,” Mr Black said.
“Our prosperity is being held back because many Australians can’t buy a home or are paying too much rent, and fixing this issue means putting hard but important policy changes on the table.
“We want the Federal Government to create a new national reform fund, like the one created in the 1990s, that incentivises states to fix regulation and planning bottle necks that hold back homes being built.
“Governments at all levels have recognised the importance of supply as the real solution to our housing challenge. We back many of the measures that are already being rolled out, but the scale of the task before us remains immense, and so we need every good reform on the table if we’re to hit our targets.”
There are a range of ways to tackle this challenge and one of the report’s key focus areas is apprentices.
“We urgently need to address Australia’s skills shortage crisis, because we can’t build homes if we don’t have enough trades to build them,” Mr Black said.
“We need strong incentive structures in place to boost numbers and opportunities for young Australians in the construction trades.
“We also need skilled migration visa settings that attract the trained workers we require and better systems to recognise existing qualifications.”
The report calls for harmonising trade licencing and accreditation across jurisdictions in Australia to the highest standard, boosting apprenticeship numbers in construction trades and incentivising skilled migration where domestic labour supply can’t meet demand.
“There’s no sensible reason why a highly qualified tradie in one Australian state shouldn’t be recognised as a highly qualified tradie in a different Australian state, if they choose to move”, Mr Black said.
“This rigid approach limits economic opportunity and mobility for workers, shrinks the talent pool for employers, and is a handbrake on getting more homes built.”
This report notes there are a range of levers, at all levels of government, that can be pulled to boost supply and allow more Australians to find a home.
The BCA believes a Federal Government established national reform fund is needed to incentivise states and territories to move on housing reforms, like fixing approvals processes, that unlock productivity growth and meet the growing demand for more supply.
“Stamp duty is a horrible tax that stops Australians getting into a home,” Mr Black said.
“Stamp duty represents a massive upfront cost for people who want to move, whether to downsize and free up a family home or to move closer to a new job, and we’d like to see the Federal Government establish a reform fund to incentivise states to phase stamp duty out and replace it with a land-tax.”
Mr Black said a number of states and territories are already making headway in delivering the reforms needed to drive additional supply, but more is needed to make sure housing targets are achieved in every jurisdiction.
“States and territories are already making good headway, though we know more is needed, and so sharing ideas and solutions to ensure every part of the country benefits from lived experience in seeking to achieve housing supply targets is key,” Mr Black said.
The BCA is also calling for better laws to stamp out corruption in the construction sector, which is making building sites unsafe and unproductive. Construction sector productivity has declined in the last decade.
“We need to ensure building sites are lawful and safe places to work,” Mr Black said.
“Stamping out criminal conduct, unlawful behaviour and stand-over tactics is key to fixing the productivity problem on building sites across the country.”