10/6/2020
The Federal Minister for Housing and Assistant Treasurer drew on Master Builders advocacy today he as set out the early success of the HomeBuilder scheme in Federal Parliament today. As of this morning there have been more than 15,000 registrations of interest for HomeBuilder on the Treasury website.
But while the importance of the housing sector to economic recovery is undeniable, the contribution of the commercial construction sector continues to be vital to strong economy and economic recovery. Commercial builders have been soldiering on despite facing massive challenges. They confronted the greatest challenge in responding to the health and safety challenges imposed by COVID-19, and their effectiveness in doing so been crucial to keeping the industry open as they are in many ways the industry’s most visible sector.
But slower work as a result of social distancing has created its own threats in terms of contractual and industrial risks and costs.
Like those in the housing sector, commercial builders also confront a cliff-edge in terms of forward contracts falling away, not just in the next few months but for 2020/21 as a whole. Master Builders revised industry forecasts expect commercial construction activity to decline by $7.18 billion, nearly 16 per cent lower than we anticipated pre-COVID-10 and our advocacy is ramping in order to bolster our case for governments to act.
As part of this process, Master Builders this week has pivoted its conversations with senior Federal Government Ministers, industry stakeholders and financial institutions including Cbus and Cbus Property in this direction.
Potential areas of policy reform that resonate so far include a renewed focus on social housing, greater incentives for the private sector to get involved in build-to-rent and increased access to the National Housing Finance and Investment Corporation (NHFIC) and the programs it runs including the Affordable Housing Bond Aggregator (AHBA), National Housing Infrastructure Facility (NHIF), the National First Home Loan Deposit Scheme and the NHFIC social bonds.
The EY modelling commissioned by Master Builders shows that a five per cent increase in investment in social infrastructure and public works in the areas of health, education and defence will provide an additional $2 billion to the economy in the next 12 months.
Strong building, strong economy
Master Builders advocacy has consistently focused on the symbiosis of a strong economy and strong building and construction industry. The importance of the relationship was again highlighted today with the Prime Minister putting increased pressure on state and territory governments opening their borders. The Prime Minister’s reference to this being needed to get the “economy flying” reminds us of the crucial role that the tourism sector also plays not just in a strong economy but for the commercial builders that construct tourism facilities and accommodation around the country.