Ross Hart (Bass, Australian Labor Party) Share this | Hansard source

I thank the member for Dobell for her insightful contribution today on the Treasury Laws Amendment (Reducing Pressure on Housing Affordability Measures No. 1) Bill 2017. I say 'insightful' because it paints the picture of a government that, in an Orwellian manner, has labelled this bill as addressing housing affordability, but when you examine the bill and the government's response there is no answer for housing affordability. On this side of the House we understand the issues that have been outlined comprehensively by the member for Dobell—in particular, the personal stories of the effect of not being able to access housing.

It's important to note that, when you address the issue of housing, you're talking about not only those who aspire to homeownership but also those who are simply seeking to obtain shelter. This is of more than just peripheral relevance to the health of our communities; it's of vital importance to the health of our communities. There has been much work done, at both academic and practical levels, in joining up all the dots surrounding housing, education and health outcomes, particularly with respect to the social determinants of health. We know that, in circumstances of housing stress, whether it be access to social housing, access to a home that you are purchasing or the impossible rental market that the member for Dobell was describing in her contribution, there are real consequences. Those consequences don't just rest on individual families and individuals; those consequences are visited upon entire communities.

I am very fortunate to represent a community in northern Tasmania that has disadvantages and profound opportunities for the future, but, within those areas of disadvantage, housing is of prime importance. As the member for Dobell outlined, access to housing will affect your future employability, your access to education and your health outcomes for the long term. If we don't address in a real manner, with a proper comprehensive plan, the question of housing affordability and the issues of people that are mired in generational disadvantage then we will be making a greater problem for the future that will need to be addressed, certainly in the area of health, with overcrowded emergency services at our public hospitals, but also with long-term health outcomes, which are predominantly worse where there are significant issues with respect to housing stress, access to employment and the like.

I'm grateful that today I have the opportunity to rise and speak on this legislation, but I need to put on record my concerns about the measures that are being put forward in these bills. The bills seek to implement two of the government's 2017-18 budget measures which ostensibly relate to housing affordability. As I indicated in my outline, this government has a knack of, in an Orwellian fashion, saying one thing but delivering something completely different. The bills implement two key provisions. The first measure is the First Home Super Saver Scheme, which allows individuals who are saving for their first home to take advantage of the concessional taxation arrangements that apply to the superannuation system. Under this scheme, first home savers who make voluntary contributions into the superannuation system can withdraw those contributions up to certain limits and an amount of associated earnings for the purposes of purchasing their first home. Under this scheme, concessional taxation treatment applies to amounts that are withdrawn under the scheme.

The second measure, something that Labor is prepared to consider if the bill is split, allows for the contribution of the proceeds of downsizing of housing accommodation to superannuation, which would allow an individual to use the proceeds of one sale of their main residence to make contributions of up to $300,000 to their superannuation provider if they are aged 65 years or over. This is called the downsizer contribution. These downsizer contributions could be made regardless of the other contribution caps and restrictions that might apply to making voluntary contributions. As I said earlier, this is something that Labor's prepared to consider, if the bill is split.

As I indicated earlier, there is a prime importance associated with the question of housing and housing affordability. It's obvious that something needs to be done with regard to housing affordability in this country. It had been a matter of national pride in recent decades that Australia enjoyed some of the highest rates of homeownership in the world. It's equally obvious that those days of record homeownership are long gone. It is a very telling statistic that close to 70 per cent of Australians are very concerned, or somewhat concerned, that they will never own a property in their lifetime, according to recent research undertaken by the Australian National University. The Committee for Economic Development of Australia released a research report last month investigating whether or not it's time for Australians, as a community, to let go of the great Australian dream of homeownership. The report indicated that Australia's housing affordability crisis is likely to continue for another 40 years—40 years!—unless there are major changes to the market. Historically low interest rates, an unprecedented period of continuous economic growth and strong levels of migration have contributed to increased demand and escalating house prices. The CEDA report concluded that demand pressures and supply problems are likely to continue for the foreseeable future. Between 1996 and 2006 Australian average house prices, relative to income, almost doubled. Indeed, this trend has been apparent for more than 20 years. While income doubled in the years 1985 to 2004, there has been a four-fold increase in house prices in the same time frame.

The impact of higher housing costs is most strongly felt by lower income groups, particularly low-income renters, for whom homeownership is increasingly out of reach. As I said earlier, this will have profound consequences for inequality in the future. This is an issue that this government denies is even a problem, while Labor wants to put inequality front and centre in the development of policy. There is, of course, a good reason for this. The government fails to understand or simply doesn't care about the interrelationship between inequality and health and education outcomes. In turn, education, housing and other factors, as I said earlier, are fundamental aspects of the social determinants of health. Labor's focus on jobs, health and education is designed to address the issue of inequality. Similarly, combating homelessness and addressing housing affordability is a constructive and practical measure in ensuring the health and economic security of our communities throughout Australia.

Labor wants to give those who are low paid and in insecure employment access to housing, including the opportunity to aspire to homeownership, whilst this Liberal government's policy favours those who are using negative gearing to acquire multiple properties. An estimated 875,000 households are experiencing housing stress—that is, they are paying more than 30 per cent of their income in housing costs. This is a contributing factor to increasing disadvantage and inequality, something the member for Dobell outlined in her speech. At the same time, these individuals and families who are struggling to afford their first home are being saddled with debt, ever increasing living costs and wage growth that has stagnated at the lowest level in decades. In contrast, those who are highly paid can, under this government, rely upon a tax cut, access to negative gearing and the capital gains tax discount. Indeed, those with access to family trusts can effectively elect how much tax they wish to pay with respect to investment or business income, unlike in the position adopted by Labor.

So, in the face of all this, what is this government going to do to address the housing affordability crisis that we are currently facing, which is an issue of profound concern to many Australians? A responsible government would listen to the concerns expressed by those who aspire to home ownership, but who are fearful that home ownership is, or will be, beyond them. A responsible government would look at the underlying supply-and-demand drivers of housing prices and deliver a comprehensive response—a plan for future home ownership. We have the government's grand plan before us in this bill, and I'm sorry to say that it does nothing to address the issues at hand. It only serves to undermine Australia's world-class superannuation system whilst at the same time failing to address housing affordability.

As a matter of public policy, superannuation accounts are supposed to be locked boxes to generate retirement income, not the playthings of a government of the day to give access to super savings for whatever priority they wish. Labor is justifiably proud of its track record in establishing and growing our system of compulsory superannuation—might I say, against the resistance of those opposite and the dead hand of successive Liberal coalition governments for over 20 years. Only Labor can be trusted to protect the national savings pool which is represented by our compulsory superannuation system.

The Treasurer's dodgy super scheme laid out in this bill will do nothing to address housing affordability. In fact, it will most likely have the exact opposite effect. Anyone with a basic understanding of economics knows that, if you stimulate the amount of money people have, it'll drive up demand—particularly if there's no further supply—and housing prices will consequently increase. The shadow Treasurer, the member for McMahon, explained this most succinctly in his speech on the bill just yesterday:

They don't understand that if two bidders, for example, at an auction—because this would be available to more than one person—come to that auction and said, 'We've got access to our superannuation, so we're going to bid higher', they're going to bid against each other, and they're going to bid the price up. The only winner in that scenario is the vendor, who can get more for their house. The actual person who purchases the house, having used some of the money that was set aside for their retirement income, is no better off. The person who missed out on the house is no better off. The person who is better off is the vendor, and that is making housing affordability worse. Whether it's an auction or whether it's just sold in the normal fashion through a real estate agent, the laws of economics are the same.

Only this Liberal government could so incompetently manage public policy as to introduce a housing affordability measure that does exactly the opposite of its intended effect and drives up prices. But there are other problems in principle presented by this absurd legislation. The government purports to be a friend of business and a supporter of the free market, but it makes clear with this bill and others that it indeed favours intervention, which will also have the effect of driving up prices, and it is not opposed to undermining our national savings.

Labor will oppose this legislation as the party that supports superannuation and as the party with a comprehensive plan to deal with housing affordability. Labor's plan to reform negative gearing and the capital gains discount will mean that a first home buyer does not have to compete with an investor who may be buying their fourth or fifth property. A reform of this kind creates a fairer tax system and a positive return to the budget. Yet those opposite refuse to even entertain the idea of such reforms, so concerned are they with protecting their mates from the top end of town, with their agenda based upon tax cuts for the well-off and cuts to Medicare and education. I do make the point, as I said previously, that if the government was to separate the two measures in this bill, Labor would not oppose the downsizing measure. However, I emphasise that any housing affordability package that does not deal with negative gearing and the capital gains tax discount is a sham.

Labor has been leading the way on housing affordability, and only Labor will properly deal with a system that advantages investors over the first home buyers. This is an area of public policy that we absolutely must get right. It's vitally important for our communities, particularly our disadvantaged communities, that we provide secure and affordable housing. If we don't provide secure and affordable housing, we will condemn future generations.

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