Freeze on Rent and Rate Increases Bill 2023

High-Level Summary
The Freeze on Rent and Rate Increases Bill 2023 seeks to establish a national freeze on rent and interest rate increases to address the housing and rental crisis. It proposes a two-year freeze on rent increases, caps on subsequent increases, and enhanced powers for the Treasurer to manage interest rates.

Summary
The bill affects the Federal Financial Relations Act 2009 by introducing model tenancy standards as part of designated housing agreements between the Commonwealth and States. These standards include a two-year freeze on rent increases, a cap on rent increases thereafter, and a ban on no-grounds evictions. Rent control measures would apply to the property, and rents for new market entries would be linked to median rents for comparable properties. Additionally, the bill strengthens the Treasurer's powers under Section 11 of the Reserve Bank Act 1959 to ensure the government is responsible for monetary policy, including freezing interest rates for a specified period. From the explanatory memo:
The Bill requires the Minister to take all reasonable steps to reach new housing agreements with the States that include these rent control measures by 30 June 2024.

Argument For
Normative Bases
  1. Egalitarianism
  2. Social Support/Welfare
  3. Non-Discrimination

The bill should be supported because it aims to address the urgent housing and rental crisis affecting low-income and vulnerable populations. By freezing rent increases and capping future increases, the bill seeks to make housing more affordable for essential workers and those receiving government assistance, who currently face severe market exclusion. Limiting interest rate increases similarly provides protection against rapid cost-of-living escalations, contributing to economic stability and preventing further financial hardship for Australians [Judgment].

Additionally, this bill aligns with Australia's obligations under the International Covenant on Economic, Social and Cultural Rights to improve the standard of living and ensure housing affordability [Judgment].


Argument Against
Normative Bases
  1. Propertarianism
  2. Hobbesianism

The bill should be opposed because it infringes on property rights by imposing rent controls, which may discourage investment in the housing market and lead to a decrease in the quality and availability of rental properties. Rent control measures can create distortions in the housing market, potentially resulting in reduced housing supply and long-term negative economic impacts [Judgment].

Moreover, empowering the Treasurer to overrule the Reserve Bank on interest rates could undermine the independence and expertise of monetary policy decisions, which are crucial to maintaining economic stability [Judgment].


Date:

2023-06-19

Status:

Before Senate

Sponsor:

FARUQI, Sen Mehreen; MCKIM, Sen Nick

Portfolio:

Unspecified

Categories:

Housing Policy, Social Support / Welfare, Financial Regulation

Timeline:
19/06/2023
18/10/2023

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