Private Finance for Social Housing in Australia

Abstract

One of the significant changes in the finance of social housing in the 1980s was an attempt to place increased responsibility for this funding on the private sector. This paper argues that governments need to continue their involvement in the provision of social housing finance as this movement towards more private sector funding progresses. Financing initiatives undertaken in Australia are used to signal the risks associated with the provision of social housing finance, to illustrate the mechanisms employed to manage these risks and to highlight the conflicts which arise when a public/private funding mix is attempted. The paper outlines a proposal for the introduction of "equity bonds" as an innovative way to raise finance for the provision of social housing and to overcome inefficiencies arising from the complex and costly administrative structures currently in use.