The proposed scheme would allow tenants to transfer their rental bonds between leases instead of having to pay a second bond before their previous one is refunded.
Additionally, renters would earn interest on their bonds, potentially building up to $2,600 in savings over ten years.
McKell Institute CEO Edward Cavanough stressed the urgent need for such reform, pointing out the significant cost-of-living pressures faced by renters.
“Renters are under enormous financial strain, and the current need to double-up on bonds to move often traps people in unsuitable housing,” Mr Cavanough said.
“A National Portable Bond Scheme would put real money back into the pockets of people who often desperately need it.”
Under the current system, bond-holding authorities and landlords benefit from the interest earned on rental bonds, leaving tenants with no financial advantage for their contributions.
“That’s stupid and unfair,” Mr Cavanough said. “A National Portable Bond Scheme would ensure tenants are rewarded for their responsible tenancy and enjoy interest on the money they have paid.”
He noted that such a policy could provide immediate relief for renters while also addressing longer-term challenges.
“The ‘Australian dream’ of property ownership is out of sight for many, yet our entire political class remains obsessed with the interests of homeowners. Renters are overlooked and treated as a minority or pitied for their inability to achieve homeownership,” he said.
“Renters need to be treated seriously with practical reforms that offer them real benefits today while laying the groundwork for long-term change.”
The McKell Institute estimates that renters could accumulate thousands of dollars in interest over time, creating a small financial safety net for emergencies or future investments.
“If people get an opportunity to move and improve their work, study, or living conditions, they shouldn’t be held back by our outdated and unnecessary bond system,” Mr Cavanough added.
The proposed scheme also has political implications. With renters increasingly becoming a significant voter bloc, the McKell Institute believes that Labor should prioritise policies that directly benefit them.
“Labor needs to have a serious think about what they do for renters, as these voters could decide the party’s fate at the upcoming election,” Mr Cavanough said.
