Meet the homeless protesters who are taking on tax breaks for the rich

Extract from The Guardian

Van Badham

There are 25,000 homeless people in Victoria and 80,000 empty homes. Protesters for public housing in Melbourne are taking matters into their own hands

Protestors for public housing at a property in Bendigo Street, Collingwood, Australia, on 7 April 2016. Photograph: Van Badham for the Guardian

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Friday 8 April 2016 11.12 AEST 

Some of the new residents of 2 Bendigo Street, Collingwood are gathered out the front when I arrive for my visit to the house. The elder among the eight or so men and women I encounter – one of whom has mane of silver hair and a beard and maintains, despite his cheap wraparound sunglasses, a grand, Gandalfesque air – are in deckchairs, chatting, soaking up some Melbourne sunshine. The younger are pottering about with a small plot of plants in a box, or coming in and out of the house with stacks of chairs and mugs of tea for their seated seniors.
I’m not the only visitor; some of the neighbours have stopped for a chat. As a first impression it’s hard not to be struck that such a bustling, visible and intergenerational community – remembered so clearly from my own suburban Australian childhood – is now a rare sight in our contemporary suburbia.

But this is not, of course, the only unusual feature of what’s happening at 2 Bendigo Street. The friendly new residents are not homeowners, or renters, but a collection of homeless people and activist allies. The houses they have moved into belong to the Victorian state government, purchased to make way for the shelved East West Link road project, which would have flattened them. My guide to this “live-in” protest, Javed, a 27-year-old urban planning student from RMIT, tells me that perhaps as many as nine properties on Bendigo Street sit empty, and have done so for 18 months.
On my tour of the street, he takes me to peer into the empty rooms of 18 Bendigo, which provided the impetus for the current protest action. Javed explains that a few months ago, a group of four homeless women took shelter in this property. When discovered by police, they were lured out. Suggestions of resettlement and support were never fulfilled, and they found themselves homeless again.
Word of this betrayal travelled through Melbourne’s homeless community, which now numbers an estimated 25,000 people. In a state that now has 35,000 people on a public housing waiting list that is often over a decade long, a recent report by economic think-tank Prosper revealed that water-usage statistics indicated that as many as 80,000 residential properties in greater Melbourne sit empty.
Outraged, the Homeless Persons Union – an activist collective directed by long term homeless people who, as perhaps the most shocking metaphoric indictment of Australia’s public housing crisis, have a Facebook page and a Twitter account, but no permanent shelter – mobilised for Bendigo St, scooping up allies like Javed on the way.
The Melbourne story is not, of course, unique in this country. The provision of public housing is one of the five pillars of the welfare state, the post-war social contract for economic egalitarianism that laid the foundations for shared Australian prosperity.

A poster in one of the Bendigo Street properties. Photograph: Van Badham for the Guardian

My own family was able to emerge from the inner-city ghettoes of Sydney’s impoverished immigrant Irish when my grandfather’s war service entitled him to a low-interest loan to build a home that went on to house four generations of us. But as decades of neoliberal economic policies are also working to erode that egalitarian investment in education, healthcare, pensions and support for the unemployed, denuded public housing policy has dovetailed with tax minimisation strategies applied to negative gearing and capital gains.
Complaints about housing affordability from those who are working, earning and sheltered are a national affliction that derives from the same disease as that dispossessing the Melbourne underclass. Those begrudging the actions of the homeless in taking up residence in properties that they can’t afford, should consider the insight from Prosper’s research.
Prosper economist Karl Fitzgerald explained to me that there are now more than 10 tax advantages for property investors, “with capital gains triple the possible rental incomes in many locations”. Reducing housing supply in a demand-driven market inflates the value of properties that can then be borrowed against and used to fund the acquisition of even more properties with their tax offset on the investment, perpetuating the cycle of inflated value and ongoing, massive tax concessions.
“Higher prices ensures money flows out of communities and concentrates in the deep-pockets of those enjoying the first-come, first-served economic system,” Fitzgerald explains. Inflated costs affect government acquisition, too; it’s for this reason, he says, that NSW’s much-vaunted new public housing policy will cost $1.1bn to deliver only 3,000 houses over 25 years, while first home buyers are taking out 40 year mortgages that can demand $200,000 per decade in extra interest.
Fitzgerald is no outlier in his opinion of the iniquity; economist Saul Eslake recently denounced negative gearing as a form of tax avoidance. In a world deservedly resentful of the revenue gouging exposed by the Panama Papers leak, it’s worth remembering that property-rich individuals in Australia can claim the tax concessions of negative gearing against their wages and salaries. And while Australian government’s struggle to find the revenue to fund adequate public housing, Malcolm Turnbull himself has defended the current tax arrangements that favour investors, defending negative gearing to Leigh Sales in a recent interview as “income tax 101”, reflecting “a fundamental principle of tax law.”
If that’s a fundamental principle of tax law, it’s a fundament that is crushing those at the bottom of it. As I leave Bendigo Street, the residents are discussing preparation for a community meeting about their protest in the evening, as well as talking through a response plan should the house be raided by police in the middle of the night.
As people share stories of previous police encounters, it becomes clear from the tone of grim, bemused experience that the Bendigo Street residents will be staying until they are removed. They are people with nothing – literally nothing – to lose.