This proposal has five components.

Component 1 – Federal Housing Trust

• This component would establish a Federal Housing Trust (the Trust) for the construction of 500,000 new residential dwellings over 15 years.
• The Commonwealth Government would provide two‐thirds of the required funding, and state and territory governments would provide the remaining one‐third. Contributions from state and territory governments could include provisions of land, either as free title or leasehold.
• The Trust would be established outside the general government sector and would construct residential dwellings, manage tenancies and sell dwellings to low‐income households, in partnership with state and territory governments and affordable housing providers. It is intended that the Trust would cover its costs through rental income and sales of properties to low‐income households.
• The funding provided per dwelling would be $300,000 in 2019‐20 (on average), including the costs of construction and land acquisition.  Funding would be indexed in line with land and construction costs.
• The Commonwealth Government’s contributions would be funded by issuing Commonwealth Government guaranteed bonds to wholesale or institutional investors. These bonds would pay a fixed interest rate reflecting the 10‐year Commonwealth Government bond rate compounded monthly, paid annually, and maturing after 10 years.   
• The funds raised through bond issuance by the Commonwealth Government would be lent to the Trust, which would then be used to fund land acquisitions and dwelling constructions. Loans to the Trust by the Commonwealth Government would have a fixed interest rate equal to the Commonwealth Government’s borrowing rate, compounded monthly, payable annually, and with 10‐year maturity.

Component 2 – Capital Grant Fund

• This component would establish a Capital Grant Fund (the Fund) to provide state and territory governments with $1,500 million each year for the first three years, and then $2,500 million divided evenly over the next seven years for housing improvements and construction.

Component 3 – Boost tenancy advocacy services  

• This component would boost tenancy advocacy services by $30 million each year, indexed by the consumer price index (CPI), for 10 years from 1 July 2019.

Component 4 – Increase funding for transitional housing and crisis services

• This component would increase funding for transitional housing and crisis services by $500 million each year, indexed by the CPI and guaranteed for 10 years.

Component 5 – Reverse the expansion of the Commonwealth Divestment Program

• This component would reverse the 2019‐20 Budget measure Expansion of the Commonwealth Divestment Program.

The proposal would commence from 1 July 2019.