Jill Hall (Shortland, Australian Labor Party) Share this | Hansard source

It gives me great pleasure to speak on the First Home Saver Accounts (Further Provisions) Amendment Bill 2008, and its related bill. One of the most pressing issues in Australia today is housing affordability and the ability of Australians to find suitable accommodation in which to live. There has been a chronic shortage of rental properties. Even in the electorate of Shortland, in which only a small percentage of people live in rental accommodation—which, by comparison, is unlike the electorate of Sydney—it is just about impossible for people to find rental accommodation. On the other hand, those people seeking to buy their first homes are finding that it is outside their financial means. The Shortland electorate, like most areas in Australia, has come under exceedingly heavy pressure as a result of the failure of the previous government, the Howard government, to address the issue of the chronic shortage of housing. This has led to homelessness and a shortage of rental properties, and it has increased the price of houses to such a level that young people are unable to afford to purchase them.

When the Rudd government was elected it realised that housing affordability was an area that had to be addressed immediately; otherwise, the chronic housing shortage would continue to escalate, more and more people would be unable to find rental accommodation and fewer people would be able to enter the housing market and purchase their first house. That is the background to a number of the housing initiatives that the Rudd government has introduced and will continue to introduce. It used to be practically unheard of in the Shortland electorate that a family would be unable to find rental accommodation. But, on a weekly basis, my office is assisting people to find accommodation of one sort or another.

Since the government was elected it has made it a priority to implement its commitment to create a savings culture and make it easier for Australians to save a home deposit—and that is exactly what the first home savers accounts do. They address the chronic shortage of rental properties by encouraging private sector investment in the rental market. They also improve our system of social housing and ensure that the costs that feed into housing construction are as low as possible. The Rudd government has listened to community concerns about housing affordability and is taking action to address the problem. The Rudd government is also implementing a range of new initiatives, including the first home savers accounts, which will help hundreds of thousands of potential first home buyers to save a bigger deposit through a superannuation style, low-tax savings account. The government has increased the benefits to low-income earners.

The Housing Affordability Fund lowers the cost of building new homes by working with the levels of government, particularly local government, to reform infrastructure and planning requirements. I would encourage local government to embrace the Housing Affordability Fund and to look at the way they do things and try and make it easier for their residents to build new homes.

The National Rental Affordability Scheme will increase the supply of affordable rental dwellings by up to 100,000. For eligible tenants, rent for these properties will be charged at 20 per cent below the market rate. Once again, it is an initiative that will help people who are currently struggling to find accommodation. The government will also increase the supply of land for housing by releasing surplus Commonwealth land for residential and community development.

The government has made housing affordability a key priority for COAG. Isn’t that a contrast to the Howard government? They made it harder and harder for people to enter the housing market. They made it harder and harder for first home buyers to acquire their first house. Another priority of the Rudd government is the new Housing Working Group, chaired by the Minister for Housing, which was established at the COAG meeting on 20 December 2007. It is worth mentioning that the Howard government failed to even have a minister for housing, which demonstrates how important they thought the issue of housing was. That was once again reflected by the fact that young Australians and not-so-young Australians were struggling to purchase their first home. People were being squeezed out of the rental market and finding it hard to find accommodation. They were being forced to move from place to place, sleep in their cars and even sleep in tents. I find that inconceivable in a country such as Australia.

The government has committed to increasing the supply of affordable housing and has a comprehensive plan to achieve this. As I mentioned, for the first time since 1996 there is now a housing minister. Members might ask: what happened in 1996? In 1996 the Howard government was elected, and that is when Australia started to have problems with housing. There will now be national coordination of housing policy. It is imperative that the national government show leadership. For this to be effective, it relies on cooperation and partnerships with the states and territories, as well as local government. Instead of blaming the states for everything, the Rudd government wants to work with the states so that it can deliver to the Australian people, no matter which state they live in. The government wants to facilitate better planning and leadership. The government is working with the states and territories to establish a national housing supply council to improve the evidence base for housing policy by providing advice on the adequacy of land release and housing supply to meet future needs. Once again, it is a planned approach; it is not a reactive approach. It is looking to the future and putting in place plans to deliver to the Australian people.

The First Home Saver Accounts (Further Provisions) Amendment Bill 2008 and the First Home Saver Account Providers Supervisory Levy Imposition Bill 2008 implement the government’s election commitment to introduce first home saver accounts. They are being introduced to provide a simple, tax-effective way to save for first homes through a combination of low tax and government contribution. This is a common-sense approach to the issue of assisting first home buyers, and it is something that the previous government failed to do.

The final policy design takes into account improvements arising from the consultation process to make the account simpler and fairer—once again demonstrating a difference between the Rudd government and the previous Howard government. It probably explains a little bit why they are now in opposition. It shows that on this side of the House we believe in consultation and in developing policy in consultation with the communities that we represent. Final policy design takes into account those improvements. An additional $150 million is committed over the next four years to improve the accounts and to bring total fiscal costs to around $1.2 billion over four years—a real investment in Australia’s housing.

Key changes from the discussion paper include the government contribution of 17 per cent on the first $5,000 of contribution for all individuals; removing the $1,000 upfront contribution and the link to residency to open an account; one overall account balance cap of $75,000—and that is going to be indexed; and calculating the four-year rule from the financial year in which it was opened rather than from the date of opening, which means that minimum contributions of $1,000 need to be made in each of at least four financial years to withdraw funds; and providing a 14-day cooling-off period. Accounts may be offered from 1 October 2008—yes, we are nearly there. We need to act quickly to put in place the legislation that is needed so that young Australians and, as I said before, not-so-young Australians who are seeking to purchase their first home will have the potential to save for their homes through the first home savers account. Legislation needs to be introduced as soon as possible to facilitate product design by potential providers.

The regulator, ASIC, the ATO and APRA are working closely with the industry to minimise the reporting requirements as much as possible. The first home savers account will bring the dream of home ownership closer to a reality for hundreds and thousands of young Australians who have, for a very long time, seen it just as a dream—something that their parents and their grandparents could achieve but something that was well and truly outside the realm of possibility for them. It will provide an additional mechanism for individuals in a family to save for a first home in which to live. These are low-taxing accounts to assist young Australians realise their dreams of homeownership. The introduction of a flat government contribution of 17 per cent for all young and not-so-young Australians will give an average income earner higher benefits than those originally announced. Easing the criteria to open accounts by removing the $1,000 upfront contribution will allow Australians to open an account without having existing savings. This is especially important for parents who may want to open an account for one of their children but not to contribute $1,000 upfront. A key feature of the account is that parents and grandparents will be able to make contributions to the accounts of their children and grandchildren, with all the benefits flowing to the home savers. This legislation puts in place a very important initiative. It puts in place, and will facilitate, the ability of young Australians to get their first home and to bring to fruition their dream—the Australian dream—of being a home owner.

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