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The federal government has agreed to waive Tasmania’s $157.6-million housing debt to address continuing housing affordability issues within the state.
The Australian government has agreed to waive Tasmania’s housing debt to the Commonwealth in an attempt to address housing affordability and homelessness issues in the southern state.
Minister for Housing and Assistant Treasurer Michael Sukkar announced that a total of $157.6 million in outstanding Commonwealth loans will be waived in recognition of the unique challenges with housing affordability and homelessness faced by Tasmania.
The Tasmanian government will reportedly save $230.2 million in total principal and interest repayments over the life of the loan term and will be required to redirect these funds into addressing the state’s housing issues.
This includes state-funded programs that improve housing supply, increase access to social housing, and reduce homelessness across Tasmania.
The state will reportedly be required to ensure local government planning and zoning reforms that support new housing supply consistent with future population and economic growth projections across the state.
Additionally, the Tasmanian government will be required to publicly report in its annual budget papers how the funds are being utilised and key outcomes being undertaken.
Minister Sukkar recognised the decision as another component of an ongoing commitment to addressing the housing crisis in Tasmania.
“The Morrison and Hodgman governments have worked hand in hand to support the growth ambitions of Tasmania. Waiving this loan will support the Tasmanian government’s efforts to reduce homelessness, increase access to social housing, and improve housing supply across the state,” Minister Sukkar said.
“This of course builds on our existing commitment to housing and homelessness through the Hobart City Deal, the Launceston City Deal and $34 million of funding for Tasmania under the National Housing and Homelessness Agreement.”
Roger Jaensch, the Hodgman government Minister for Housing, commented: “I am very pleased we have worked together to achieve the best possible outcome for our great state and to address this challenging Tasmanian issue.
“Wiping the debt will save up to $15 million annually over coming years in debt and interest payments, which will be used instead to build more social housing for Tasmanians in need. We estimate this could mean around 80 more houses for people on the social housing waiting list across Tasmania, each year,” Mr Jaensch said.
“This is a marvellous result for all Tasmanians and will enable us to build more homes in addition to our Affordable Housing Strategy, underpinned by an investment of almost $200 million over eight years, the largest ever state government investment into affordable housing in Tasmania’s history.”
Debt refers to the amount of money borrowed from a creditor with the intention to pay back at a specified date.