Housing Market Health higher priority than Hospitals in South Australia

On Tuesday it was revealed the South Australian Government will need to chop $1.4 billion from the state coffers by 2016 with $240 million coming from the Department of Health and Ageing.

Eyes are now on the state government after three independent audits recommend the cutting of 308 staff and 114 beds in South Australian Hospitals.

Auditor-General Simon O’Neill indicated the global financial crisis is having a major impact on state revenue with property prices falling and the consumer more careful with spending.

But while Health and Hospitals beds are getting the cut, the state government has found money to help prop up the ailing residential construction sector, announcing a new $8500 Housing Construction Grant. Additionally, first home grants for new homes will increase to $15,000.

Premier Jay Weatherill said, “This is unashamedly about trying to kickstart investment in new-built homes.”

The grant comes amid evidence most sectors in the economy are struggling, not just housing construction. It would appear the housing construction lobby can scream the loudest.

It is estimated the new grants will cost $40 million over the next two years, but is expected to be offset by the axing of free money for existing homes.

But in order to spruik the new residential construction stimulus, it was further revealed today the Government will spend hundreds of thousands on a marketing campaign including print, radio and television.

» Newly built homes in South Australia to be eligible for a grant of up to $8500 – Adelaide Now, 15th October 2012.
» $1 billion must be cut from South Australian Government Budget, Auditor-General Simon O’Neill warns – AdelaideNow, 16th October 2012.
» Housing grants reformed for struggling SA market – The ABC, Tuesday 16th October 2012
» State Government to spend hundreds of thousands to spruik housing stimulus package – AdelaideNow, 18th October 2012.


  1. It’s like a Mitt Romney wet dream. Wake up Australia – you’re becoming like America. Stop! This ‘could’ be a great country, but the politicians are completely screwing it up for their own short term personal gain. It’s so corrupt, and everybody’s too dumb and too lazy to do anything about it. Go back to bed Australia. You’re government is looking after you. Here’s Cherry Ripe and Coke. Go back to bed Australia. Here’s Foxtel. Go back to bed Australia. You know why they call it the Australian dream? – you have to be asleep to believe it.

  2. Yes, as a proud Crow Eater, embarrassingly this is true. Greg Moulton REI spokesperson, outlined in the report confirms they see an increase in prices (debt) in that area. The one consolation if at all, is the reduction in grants for existing homes, to slow the ‘existing homes/made a rental’ conversion rate we see. But will we ever see a real brave move and direct NG investment to new homes only ? I doubt it I am afraid, but in the meantime, FHB’s get stung with further debt. ALA Steve Keen, will we call this announcement the ‘First Home Buyers Developers Boost’ ?

  3. I keep hearing these grants are a good thing for housing supply in these states SA, NSW and QLD. Its nothing but a construction industry bailout for an obese sector that deserves to be crushed by its own weight. The state governments and developers are selling an ever unaffordable product in a ‘free market’ that needs to be subsidised by the the tax payer to stay ‘affordable’. Just like negative gearing, its hand over fist money from joe taxpayer to support an inefficient market to keep the whole thing falling over. Once again supporting the greed property gambling market comes before peoples well being. The country needs a good cold shower to wake up from the delusion of maintaining a market of property as investment.

  4. The really sad thing is that no media outlet will cover this story.

    You’d think that any story that involves cutting hospital funding would be at the top of the list on ACA and TT but because it involves the Housing Ponzi ( one of their largest sponsers) I dobt it will get much attention.

    Move along nothing to see here.

  5. They make it sound like they are doing people a favour.
    $8,500 incentive to assist you to inherit a $400,000 debt.
    I’d much prefer no incentive and a more realistic $250,000 debt.
    But anything to keep those tradie one-tonners on the move, hey?

    If they’re screaming now, wait until Europe and China really hit the wall.

  6. Since 2000 SA was building more homes per every new resident (one home for every 1.39 new residents) than any other state in Australia, even more than any state in USA (rate in Florida was one home per 1.8 new residents), any province in Spain or Ireland. SA has huge oversupply of homes and large increase of empty homes since 2000 (from 9.5 to 12%). The last thing SA should spend money is new homes.

  7. You need to remember this State Government is on the gravy train, like everyone else. They have developments to sell at http://www.ura.sa.gov.au/Currentresidentialandindustrialprojects/Residential.aspx just like the private sector.
    Speaking of marketing, if you click on the link – do you like the image? I bet some of the top marketer’s in the state worked on this masterpiece. The kids are not in their new home playing playstation, or listening to their ipods. They are playing Monopoly, and the board has been positioned perfectly to reflect the Monopoly logo. Top job, hey.

  8. @ raveswei can you tell me the source for your information, just so I can use it myself

  9. Nice observation Tom. I wonder who chose Monopoly?

    I would have also thought “Risk” to be equally appropriate, or it could have been strategically juxtaposed in the background.

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