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Labor VS Liberal: Who is positioned to be the best for vulnerable Australians this federal election?

The rising cost of living and growing housing issues have remained at the forefront of election discussions and for good reason. Nationally rents have risen by 9.7% over this past year (Homelessness Australia 2021). Throughout the pandemic, house prices rose on average by a record 25% (ABS 2021). According to a 2021 survey conducted by the Australian Institute of Health and Welfare, more than 1 million Australian households are under housing stress (AIHW 2021). Whereby, they are spending 30% or more of their income on housing. The number of Australians experiencing housing stress is only going to increase as interest rates continue to climb and wage growth continues to slow.

The household saving ratio declined from 19.8% to 13.6% (ABS 2021).The fall in household savings was driven by increased household spending, coupled with a decline in household income. Household gross disposable income fell 0.5%, driven by a decline in support payments from government following the end of lockdowns (ABS 2021).

The cost of living in Australia has dramatically increased in the past year with all Living Cost Indexes (LCI’s) increasing between 3.8% and 4.9% (ABS 2022). The largest contributor being Food and non-alcoholic beverages and Transport (ABS2022). The Consumer Price Index (CPI), which measures household inflation, rose by 2.1 per cent in the first quarter of 2022 and 5.1 per cent annually (ABS 2022). To put in perspective, the quarterly and annual increases are the largest since the introduction of the GST more than 20 years ago.

The 2022 Federal Election is tomorrow, offering Australians the chance to have their voices heard on a range of different topics. This article looks at where the Labor and Liberal party stand on the cost of living and housing. Which party is positioned to be the best for some of the most vulnerable Australians: those living below the poverty line and those experiencing homelessness?

Approximately 116,000 Australians are currently experiencing homelessness and almost 300,000 people have sought out the support of homelessness services this past year as they contend with rising rents and the shortage of social and affordable housing. This demand for homelessness services is set to rise again throughout this year as inflation rate remains higher than wage growth and interest rates on debt and loans are set to increase.

The Liberal Party

Homelessness services face a $39.4 million funding black hole from July 2023 as the liberal parties 2022 budget proposal failed to provide appropriate ongoing funding for staff costs, despite surging demand for services.

Earlier this year the parliamentary inquiry into homelessness called on the Federal Government to develop and implement a ten-year national strategy to address Australia’s growing homelessness crisis. Not only was this recommendation rejected by the liberal government, but just two of the 35 recommendations put forward were fully supported.

Cost of Living

In an attempt to compensate for the high cost of living, the liberal government has committed to a one-off $250 cost of living payment, which more than six million Australians would be eligible for. Additionally, it would also provide a $420 cost of living tax offset, which more than 10 million low and middle-income earners would be eligible for. Considering the Australian Bureau of Statistics puts the average Australian family’s weekly costs at $1450, this one off payment is unlikely to give vulnerable Australians any substantial cost of living relief (ABS 2021).


This week the liberal government announced a super scheme for first-home buyers, allowing Australians to invest up to 40% of their superannuation to a maximum of $50,000 to help purchase their first home. This policy has been widely criticised by unions and major industry groups as it props up an already unaffordable housing market by tapping into Australian’s retirement funds.

Finally, the Liberal party aim to increase their investment into affordable housing with an additional $2 billion in low-cost financing for social and affordable dwellings. This brings total low-cost financing to $5.5 billion, supporting around 27,500 dwellings.

The Labor Party

Cost of Living

The Labor party are promising legislated tax cuts that would deliver tax relief for more than 9 million Australians with incomes above $45,000. Identical to the Liberal Government, the Labor party would also provide a lower and middle income tax offset of $420 this year. Again, this is by no means a substantial offer considering the average Australian family's weekly costs are $1450.

Labor leader Anthony Albanese has endorsed an increase to the minimum wage of at least 5.1 per cent, to keep up with the rate of inflation.


Labor is looking to invest in affordable housing with their $10 billion Housing Australia Future Fund that aims to build 30,000 new homes in its first five years. The labor party has committed to allocate 4,000 of those homes to women fleeing family violence and older women at risk of homelessness. Whilst both Labor and Liberal are looking to invest more in social housing and low-cost financing, only Labor has committed to subsidising the "gap" between the cost of building social housing and the rents that people can afford to pay once it is completed.

Labor's key home ownership policy is a "shared equity" scheme that would help 10,000 people own homes by sharing the cost with them. The Help To Buy scheme sees people putting forward as little as little as 2 per cent of the deposit and the government holding as much as a 40 per cent stake in the property, effectively as a co-owner. The scheme also avoids the need for lenders mortgage insurance and is open to people earning less than $90,000, or couples earning less than $120,000. Although the shared equity scheme would help a lot of first-time buyers enter the property market, it could increase housing demand and by extension keep housing prices high.

Final thoughts

- The Liberal Government has a history disregarding expert advice about addressing homelessness and the growing demand for homelessness services.

- Although both parties are looking to increase Australia's investment in social housing, neither policies do enough. Considering the number of people experiencing homelessness is approximately 116,000, Labor's aim 30,000 homes and Liberal's aim 27,500 homes fall far from the mark.

- More needs to be done by both parties in addressing the disparity between the current cost of living and income. However, Labor leader Anthony Albanese endorsing an increase to the minimum wage of at least 5.1 per cent, to keep up with the rate of inflation is a step in the right direction.


ABS (Australian Bureau of Statistics) (2022) Selected Living Cost Indexes, Australia

-------------- (2022) Consumer Price Index, Australia

AIHW (Australian Institute of Health and Wellbeing) (2021) Homelessness and homelessness services

-------------- (2021) Housing affordability

Parliament of Australia (2021) Inquiry into homelessness in Australia. Parliament of Victoria.


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