Evaluation of the Building Financial Capacity in

Transcript:Evaluation of the Building Financial Capacity in:
Evaluation of the Building Financial Capacity in Housing Agencies (BFCHA) initiative Department of Treasury and Finance (Victoria) Final report for distribution 15 September 2023 Melissa Skilbeck, William Li, Zabard Hartmann, Susan Friend, Matt Balmford For Department Use Contents www.thinkSapere.com www.thinkSapere.com 3 List of figures www.thinkSapere.com 4 List of tables List of boxes A list of the abbreviations used in this report are provided below. www.thinkSapere.com 5 Glossary Executive summary Executive summary This evaluation The Department of Treasury and Finance (DTF) commissioned Sapere Research Group Ltd (Sapere) in April 2023 to evaluate the effectiveness of the Building Financial Capacity of Housing Agencies (BFCHA) initiative and identify opportunities to refine and improve the program to further support the supply of social and affordable housing and the value for money outcomes generated by the initiative. Sapere conducted the evaluation over April to July 2023. It is a point-in-time evaluation of a program in progress and in terms of development of social housing dwellings financed, in its early days. In practice, the evaluation covers phase 1 and 2 applications to approved agreements and the experiences of community housing agencies (CHAs) in the applications for phase 3 whose applications were being considered for approval during this BFCHA work. It also coincides with significant macroeconomic changes having a direct impact on CHA preferences between phases 1 and 3. This report is based on Sapere analysis and input from stakeholders through consultations and survey responses. Survey representation of CHAs participating in the program is high—at 13 of 19 who applied and 10 of 11 approved, and accounting for around 80 per cent of loan value approved as at April 2023. Financing social housing CHAs are dependent on some form of government subsidy. This subsidy needs to cover the difference between what it costs to supply, build, maintain and manage social housing and the amount low-income tenants (particularly those receiving Commonwealth Rent Assistance) can afford to pay. BFCHA is part of the $2.7 billion Homes for Victorians 2017 Government strategy that established funding—in the form of the $1 billion Social Housing Growth Fund (SHGF)—and financing—in the form of $1.1 billion for Low Interest Loans (LILs) and State Guarantees through the BFCHA initiative. Loan tenor (term) of funds in the SHGF were subsequently expanded by the Big Housing Build initiative in 2020. BFCHA provides LILs (and offers State Guarantees which have not yet been taken up) at the State