Tanya Plibersek (Sydney, Australian Labor Party, Shadow Minister for Human Services, Housing, Youth and Women) Share this | Hansard source

You certainly did not say it, but that is what he heard. Over recent years, as interest rates have dropped, the government has been so very quick to take credit for it; you could not believe how quickly they took credit for interest rates dropping. It was all about the Prime Minister’s wonderful economic management; it was all about the Treasurer’s brilliance. Actually, it was not about the Treasurer’s brilliance, was it? It was always the Prime Minister taking responsibility for it. So it was not the Treasurer; it was the Prime Minister. The Prime Minister tells us that his leadership and his economic brilliance kept interest rates low. But as soon as they start going up again he says, ‘It’s not my fault; it’s nothing to do with me.’ Whose fault is it? It was the drought; it was the cyclone; it was this; it was that. He has run out of things to blame, so he turns to the states. Fascinating, isn’t it: although the states had nothing to do with interest rates falling, they are completely responsible for interest rates going up.

It is incredible, too, that when it comes to the issue of housing affordability it is nothing to do with the federal government—according to the federal government—but always the fault of local government and the states. And we heard from the minister today that it is actually the fault of those greedy parents wanting to put a roof over their kids’ heads. If you look at any analysis of the cause of housing unaffordability, there are things that local governments could do to improve it and there are things that state governments could do to improve it. But every single credible analysis says that high interest rates are affecting housing affordability. People have borrowed more than ever before, so even small increases in interest rates affect housing affordability. When houses cost four times the average annual wage 10 years ago and now cost seven times the average annual wage, you do not have to be a genius to work out that people are borrowing more. They have household debt three times the size that they had when interest rates were high under the last Labor government. As such, miniscule increases in interest rates make their housing unaffordable.

We now have a million people in this country who pay more than 30 per cent of their household income—not their personal income—on the rent or the mortgage. That is a historic high. Never before have we seen figures like that. Is the Treasurer worried? No, he is not worried, because on 27 February 2005 he said that any interest rate under 10 per cent is low. He said:

If you see a single digit in front of your interest rate, that’s low.

Well, it is not low for families who have borrowed hundreds of thousands of dollars to afford the average home.

We now have a situation where the average family cannot afford the average home. We know now what you have to be earning to service a mortgage on a median-priced home. In Australia’s capital cities you need a family income of $115,777 to service a mortgage on the median-priced home. That is not a mansion or a home in the eastern suburbs of Sydney or the eastern suburbs of Melbourne; on the median-priced home you have to be earning well over $100,000 to service a mortgage. That means that there are a lot of people locked out of the housing market.

There has been a lot of debate over the last couple of days about whether the Prime Minister said he would keep interest rates at record lows or keep interest rates lower than they would ever be under Labor—blah, blah, blah. What people heard during the last election was that the Prime Minister gave his words that interest rates would stay low under a Liberal government. That is what people heard. It is like the cartoon—what people say; what dogs hear. The message that people got, loud and clear, is that the Prime Minister would keep interest rates low. Perhaps it was a non-core promise!

It is interesting that we have seen an enormous move since the note that was leaked from Shane Stone, saying that the government was mean and tricky. We have really revolutionised things! Textor says that the government is arrogant and out of touch, not mean and tricky. Things have really changed in the last few years!

I guess we should not be surprised by the broken promise on interest rates, because Janette Howard—someone who knows the Prime Minister pretty well!—said to the authors of a book about Mr Howard:

You talk about a whole lot of things when you’re trying to convince people to do things—

like vote for you in a federal election—

but you don’t go back and honour every single one of those unless you have made a firm commitment about it and John wasn’t into making firm commitments.

That was about the leadership but it really applies here, doesn’t it? Obviously, in the Prime Minister’s mind when he said he would keep interest rates low—when the Liberal Party advertising said that they would keep interest rates low and when the website, just today or yesterday, was still saying they would keep interest rates low—it was not a firm commitment, because the Prime Minister is not into firm commitments.

I do not know how the Prime Minister expects the Australian people to believe a single word he says in the next election campaign. People are always going to be looking for what the catch is here. If he says he is going to keep interest rates at historic lows, what does he really mean by that? Does he mean we are going to see five back-to-back interest rate rises after the election? Is that what he means by keeping interest rates at historic lows? Who knows? Why would the Liberal Party spend a single dollar on advertising when it means nothing? Why have a website if you cannot trust a single word that is on the website?

The Prime Minister has wonderfully selective amnesia! I have to take my hat off to him. He is so brazen in talking about 17 per cent interest rates under the last Labor government when he, as Treasurer, presided over 22 per cent interest rates. How can he possibly think that nobody is going to call him on that inconsistency?

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