Page 4300 - Week 14 - Wednesday, 27 November 2013
MR BARR: I point Ms Lawder to the difference between an individual’s income, which was the basis for the original scheme, and household income, which is the basis for the revision. What was happening under the original scheme was that, as long as one member of the household had an income below the threshold, they were eligible. We have now put in place a scheme that is consistent with access to other ACT government concessions in the housing arena where we are looking at the totality of household income—so looking at income earned by other members of the household. That difference is important in terms of the eligibility for the different rates of land rent.
But the principle behind the change that was put forward in the amendment bill was to ensure that the scheme was targeted to those on low to middle incomes and that it was not being accessed by builders in particular seeking to utilise the scheme to minimise their holding costs.
MADAM SPEAKER: A supplementary question, Ms Lawder.
MS LAWDER: Treasurer, thank you for clarifying that. Could you explain the fairness, for the benefit of someone who may have signed a lease prior to 1 October and who may feel unfairly treated compared to someone who may have more recently signed under the land rent scheme?
MR BARR: If you accessed the scheme prior to the change, you are grandfathered or grandmothered into those arrangements. So you can move from the concessional rate of two per cent to the four per cent rate if your circumstances change. If you are on the four per cent rate that you have entered into, you are above the original threshold for access to the concessional rate. The changes now incorporate household income. They will ensure that the total financial situation of the household is recorded.
The circumstances of the scheme have changed, reflecting changes in the housing market, availability of affordable housing and the significant increase in supply of housing at the affordable end in the territory as the various phases of our affordable housing action plans have been implemented. What has happened over the last six years is that there has been a considerable boost in the supply of housing at our affordable housing thresholds and as we have increased supply, there have been changes in the demand mix for land rent.
We still believe it is an important part of an overall response to improving housing affordability, but what we are seeing in the housing market as a result of the increases in supply and other factors impacting on demand is an easing of house prices and an easing of rents across the city. That is a result of a number of supply and demand factors.
MADAM SPEAKER: A supplementary question, Mr Smyth.
MR SMYTH: Given that you did not answer it, minister, how many individuals on the four per cent rate pre the changes would technically qualify for the two per cent rate under the new scheme?