The Australian government will invest heavily in artificial intelligence and environmental reform measures in an effort to accelerate housing and energy developments, as pressure grows over the nation’s worsening housing affordability crisis.
As part of Tuesday’s federal budget, the government will commit $105.9 million over four years to develop an AI-powered system designed to assist with environmental approvals. The tool will help project developers access environmental data and navigate approval requirements more efficiently, allowing housing, energy, and critical mineral projects to move ahead more quickly.
Treasurer Jim Chalmers said the initiative aimed to reduce delays, cut red tape, and encourage investment while boosting housing supply across the country.
The funding forms part of a broader environmental reform package worth about half a billion dollars, including approximately $250 million to establish the National Environmental Protection Agency.
The government has also introduced a range of housing measures ahead of the budget. A recently announced $2 billion infrastructure package will help fund roads, power, water, and sewerage connections needed to unlock land for an estimated 65,000 new homes.
In addition, the government is preparing tax reforms that would scale back two major tax concessions for property investors — negative gearing and the capital gains tax discount. The proposed changes mark a significant political shift after previous promises not to alter the policies.
Housing affordability has become one of Australia’s most pressing political issues, particularly among younger voters and first-home buyers struggling with rising property prices and limited supply. Both the Australian Greens and One Nation have gained support from voters frustrated with the major parties’ handling of the housing crisis.
Mr Chalmers acknowledged that while increasing housing supply remained the government’s priority, broader reforms were also needed to make the housing market fairer. He noted that property prices had increasingly outpaced wages since the introduction of the 50 per cent capital gains tax discount two decades ago.
However, critics have warned that increasing taxes on investors could worsen the housing shortage. Shadow Housing Minister Andrew Bragg argued that higher taxes would discourage investment and place further pressure on housing construction during an already difficult period for the industry.
The federal budget is expected to outline the government’s full housing strategy and the details of the proposed tax changes.