Labor has promised to provide $200 million funding for local councils in regional areas in an effort to boost stocks of affordable housing.
It is estimated that up to 15,000 new homes would be built in regional cities over the next three years under the initiative.
Prime Minister Julia Gillard said councils would be able to use the funding to invest in local infrastructure projects that support new housing developments.
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Infrastructure projects could include connecting roads, extensions to drains and sewerage pipes or community facilities such as parks and community centres.
However, regional cities will have to compete for the funds with about 15 expected to to be successful, receiving about $15 million each.
Labor has listed just over 40 cities across Australia that would be eligible for the funds.
To secure funding, participating councils would need to put forward proposals, potentially in partnership with the private sector, for infrastructure projects that help deliver affordable housing.
Questions unanswered over congestion tax
Meanwhile the opposition says the government's congestion tax is still on the cards.
Road congestion in Australia's capital cities would cost the country $20 billion a year by the end of the decade, Ms Gillard said during an address to the Eidos Institute in Brisbane.
But she offered no specific solutions to the problem.
The opposition accused Ms Gillard of failing to rule out a congestion tax as a solution.
"She specifically and deliberately left open the Henry tax review recommendation which will increase the cost of living," opposition environment spokesman Greg Hunt told AAP.
"The prime minister must clearly and categorically rule out a government proposal that will hurt people in outer suburbs such as Penrith (NSW), Logan (Queensland), Berwick Mt Waverley (Victoria)."
Greens call for more jobs
The comments come on the first day of election campaigning, with the Greens calling on both major parties to guarantee commonwealth public service jobs.
Ms Gillard has flagged "unpopular" government spending cuts to offset Labor election promises while the coalition has said it would freeze public service recruitment.
Greens leader Bob Brown blamed both sides for failing to garner sufficient additional revenue from new mining taxes.
As a result public service numbers were being "squeezed".
"You can't have a growing country with a growing need for public service and at the same time cut back public servants," he told reporters in Canberra on Sunday.
"We want a public service that meets the demands of the country for a sustainable future we're talking about."
Both parties need to explain how they expect the public service to continue its standards with reduced numbers, he said.
