The Defunct Housing Allowance Experiment: Some Assumptions and Oversights

The Australian Housing Allowance Experiment (HAE) was discontinued in June 1978. The experiment (and any ensuing scheme) seemed destined for trouble because of difficulties unforeseen by its administrators. Some of these problems are alluded to in Albon (1977b) and are here reconsidered. Other potential difficulties are suggested. Specifically, the following issues are considered: can a tied subsidy arrangement be justified?; how does tieing create a possible difference between the dollar value and recipient's valuation of a housing allowance?; what are the implications of moving costs? and what is the likelihood of landlord-tenant coalitions? These are all questions overlooked by the Department of Environment, Housing and Community Development (EHCD).