Remote Housing Policy Challenges

By Michael Dillon

A key issue for decades has been the poor state of housing in the bush, linked to a complex set of structural forces which appear to have placed solutions beyond the capacity of governments to find or develop.

In no particular order, there are at least four structural forces at play which make management of the remote housing asset base challenging.

The environment in remote Australia places extraordinary demands on physical infrastructure, which inevitably leads to shorter asset lifespans.

The demographic explosion among remote Indigenous community residents has placed enormous pressure on housing and community stability generally. A substantial proportion of remote community residents are under 25 years of age. The resultant chronic overcrowding has placed enormous pressure on asset lifespans, as have short sighted policy responses from successive governments in terms of investing in regular maintenance.

There has been chronic underinvestment over many years in remote community housing.

The Commonwealth has been the major source of capital investment in remote Indigenous housing for at least the last two decades.

The current Commonwealth budget ‘crisis’ and the focus on achieving balanced budgets hints a major Commonwealth withdrawal from investment in remote housing in the future.

Land tenure arrangements have not been well aligned with the requirements for optimal management of the social housing asset portfolio and have not encouraged private sector investment in remote communities by residents nor Indigenous owned businesses.

The continuing scepticism from Aboriginal interests regarding the motivations behind tenure reform efforts by government suggests that the likelihood of tenure changes within communities over the coming decade is quite low, and will be largely incremental in nature. Having said that, the ability of Aboriginal traditional owners to grant leases under the current legislation means that private sector investment is not entirely ruled out.

The National Partnership Agreement on Remote Indigenous Housing (NPARIH) was extremely contentious, because it required communities to provide state and territory governments with long term leases or other forms of secure tenure to ensure that state government housing authorities would have legal rights and responsibilities in relation to the assets built and the tenancies involved.

NPARIH also bore the brunt of sustained criticism because of what appeared to be a slow start with high administration costs, when this was in fact the necessary implication of implementing a major construction project, involving immense logistical and technical challenges.

Nevertheless, it was always recognised that the funds allocated to NPARIH would only meet about one half of the outstanding social housing need in remote Australia (though governments have unsurprisingly not articulated this reality).

Moreover, while NPARIH incorporated strengthened Property and Tenancy Management (PTM) requirements, these were always vulnerable to financial cuts at both state and federal levels, and indeed this has been what has largely occurred with substantial cuts from NPARIH PTM made to expand funding for the Governments new Community Development Program.

The importance of PTM for remote housing stock is that it is a very cost effective means of extending the lifespan of the existing housing asset base, albeit one which does not have any tangible visibility in a political sense.

The media, to its credit, has to a limited extent filled the gap. The ABC has run stories on the continuing need for housing in remote regions, for example:

http://www.abc.net.au/pm/content/2016/s4497269.htm?site=indigenous&topic=latest 

http://www.abc.net.au/news/2018-01-31/indigenous-housing-scheme-under-threat-funding-runs-out/9376358?pfmredir=sm

In relation to the ownership of the remote housing asset base, the ABC reported in the first story mentioned above that the Chief Minister was proposing to eventually hand back control of all remote Indigenous housing to Aboriginal organisations.

"We believe in self-determination. We believe that Aboriginal people should continue to have the opportunity to provide the governance over their own affairs," he said.

So what are we to make of the current state of play? I will limit myself to a number of high level and necessarily provisional observations.

Governments have failed to understand the leap made by the transition to NPARIH, that is, from a micro-program delivering a total of thirty or forty new houses each year in ten or fifteen different locations using ten or fifteen contractors to a major project, with a billion dollar price tag, delivering hundreds of new houses in a limited number of locations over multi year periods. This is the equivalent of building a major dam or port, but disguised by the fact that we are accustomed to thinking about the components rather than the whole. While the reality has shifted, the mindsets of the media and politicians – and consequently many stakeholders too – has failed to shift.

The result was (and remains) a focus on numbers of houses and numbers of upgrades, whereas NPARIH’s progress and achievements is in reality based on an overall reduction in overcrowding across the remote social housing sector, delivered largely through tailored investment in locations which included the construction of a series of new, serviced and turn-key ready subdivisions, investment in asset upgrades where cost effective, and new houses where necessary. In other words, this was a systemically driven investment program, not a component based or rhetoric driven micro-program.

As a consequence, very few stakeholders understood that NPARIH represented a major step change in housing infrastructure provision in remote Australia, and needed to be project managed as a major infrastructure project, with all the associated planning, logistics, and project management strategies one would expect in a major infrastructure project.

It appears however that Governments while being prepared to pocket the gains delivered by NPARIH (for example the substantial step up in Indigenous employment outcomes over previous models derived from the scale and multiyear nature of the investment) have failed to realise that they must manage the next phase as a major infrastructure project. Given the scale of the outstanding housing need, and the outcomes both parties are promising, it is clear that the next phase cannot be managed as a micro-program and deliver the outcomes sought.

Finally, if Indigenous interests wish to take greater control of social housing provision in remote Australia, they should concentrate on establishing community housing organisations to own, manage and rent social housing assets. The required capital could be raised from a number of sources: mining royalties, the Aboriginal Benefits Account, private sector borrowings, philanthropists or, the new National Housing Finance and Investment Corporation (NHFIC) which is designed to operate an affordable housing bond aggregator to enable greater private and institutional investment and provide cheaper and longer-term finance to registered providers of affordable housing. Mainstream community housing organisations in other states would be prepared to assist, and even partner with them.

But whether or not Indigenous interests pursue such a course should not absolve government of its responsibility to provide a viable and effective social housing sector for remote communities. It is a tragedy that the current Federal Government appears to be preparing to walk away from what is in fact a core responsibility of Government.

The Government should also revisit the mindset which currently underpins their thinking on housing provision; the task ahead is equivalent to a major infrastructure project with a large number of moving parts. It will need overarching management, coordination and resourcing to deliver the outcomes that are required on the ground.

A failure to address both these issues will quickly escalate into a deeper crisis in remote housing sector as raised expectations in the bush turn to disenchantment.

Given the structural importance of adequate and non-crowded housing to addressing Indigenous disadvantage, there is a strengthening case not just for increased investment, but for systemic reform of the oversight arrangements which ensure that key investment programs such as NPARIH stay on course.

It is increasingly clear that existing oversight mechanisms - parliaments, audit offices, ombudsman offices, and the media - are not fit for purpose in monitoring complex and major government programs in the Indigenous policy domain, remote housing being just one case in point. The identification of problems often emerges, but sustained analytic proactive attention to effective program delivery and implementation is non-existent, and that gap is one that no-one, least of all our latter day princes, seem keen to close.

Used with permission

* Michael Dillon was most recently the CEO of the Indigenous Land Corporation, and veteran of Indigenous policy in government. Previously, Michael has been a deputy secretary for FaHCSIA as well as senior roles for Aboriginal organisations in East Kimberley and Central Australia, the Northern Territory Government, AusAID and the Department of the Prime Minister and Cabinet.

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