Jason Clare (Blaxland, Australian Labor Party, Shadow Minister for Regional Services, Territories and Local Government) Share this | Hansard source

Labor supports this bill, the National Rental Affordability Scheme Amendment Bill 2019. The National Rental Affordability Scheme was set up by Labor when we were in government in 2008. Investors under the scheme are provided with 10-year contracts, through both state and federal funding, and rent is provided at at least 20 per cent below market rates. When the Abbott government came to power in 2013, they cut all new funding for the scheme and they capped it at 38,000 dwellings. They also did not replace this scheme with anything else.

NRAS, at the moment, is still helping a lot of people with the cost of housing, but the number of people that benefit from this scheme is now reducing every year. This year, around 1,141 families across Australia will drop out of the scheme. Next year, another 1,368 families or individuals will see their rent rise as they drop out of the scheme. In 2021, it will be 3,059 families that will drop out of the scheme, and in 2022 that will almost double again—6,362 Australian families that are currently benefiting from this scheme will see their rents rise by up to, and in some circumstances more than, 20 per cent. By 2026, there won't be any Australians left benefiting from the National Rental Affordability Scheme.

Until then, though, the scheme will keep operating, and it's important that it operate as well as it possibly can. That's the intention behind this legislation. We think that it will help to do that. We believe that it will make some important changes to the operation of the existing National Rental Affordability Scheme, and that's why Labor is happy to support it. In particular, it improves protections for tenants and investors. It ensures that any payments to investors are done in a timely manner to ensure NRAS stock is not withdrawn from the scheme. It also removes ambiguity in relation to the calculation of below-market rents in any one year and provides flexibility in the way maximum periods of vacancy are prescribed.

The bill was examined by a parliamentary committee. That occurred before the election, in the last parliament, and we're very grateful that the government has agreed to incorporate some of the recommendations that Labor members made in that parliamentary inquiry. As part of the process of assessing this legislation, Labor has consulted with stakeholders including the National Affordable Housing Providers, the National Affordable Housing Consortium and the Community Housing Industry Association. They support this legislation. The next step, once this legislation is passed by the parliament, is the development of regulations that will help implement it. I ask that the government, in developing those regulations, consult with those organisations that support this legislation and are keen to see it implemented effectively. Those regulations will be very important. We always benefit, in the development of laws in this place and of regulations that help implement them, by making sure that we're consulting with the stakeholders who use this legislation and rely upon it.

This bill was debated by the Senate back in July. As part of that process, we proposed a number of amendments to the bill, principally to ensure that the departmental secretary retains the ability to make new allocations under the National Rental Affordability Scheme. The legislation, as presented to the parliament, proposed to remove that power from the departmental secretary. We argued—and I'm glad that the government has agreed—that that power should be retained. What that means is that, if this government or a future government wanted to extend NRAS funding, they'd be able to do so. The government has made it clear that they've got no intention of doing that, and that's their decision. But, in our mind, there is no need—and I'm glad the government has agreed—to take this power away. Therefore we will move the amendment. As I said, the government agreed to that amendment, and we thank them for it.

But there are bigger issues here than just what the government is trying to address in this legislation. Australia has a housing crisis. Homeownership rates are now at their lowest levels in 50 years, rental stress is through the roof, and more Australians are now homeless than ever before. These are big issues that this place and that this government need to confront, and it's not doing it. That's why, as part of this debate, I move:

That all words after "That" be omitted with a view to substituting the following words:

"whilst not declining to give the bill a second reading, the House:

(1) notes that this Liberal Government slashed the original cap of 50,000 dwellings in the National Rental Affordability Scheme (NRAS) to 38,000; and

(2) also notes that as a result of the Government's continuing inaction to meaningfully address housing affordability:

  (a) the percentage of Australians who own their own home has dropped to its lowest level since Robert Menzies was Prime Minister back in the 1960s;

  (b) the number of Australians behind in their mortgage payments today is at its greatest level since the global financial crisis;

  (c) a report released last month by the Australian Institute of Health and Welfare showed that in 2017-18 over 1 million low-income households were in financial housing stress and that 43.1 per cent of low income households renting in Australia are suffering rental stress; and

  (d) there are more homeless Australians than ever before".

A report that came out this year from the Australian Institute of Health and Welfare shows that over the last 10 years we have lost more than 20,000 public homes. Public housing construction hasn't kept pace with population growth. People in private rental are really struggling. Rental stress is through the roof, particularly in major cities, like Sydney and Melbourne, and even in places like Hobart. Rental stress in Hobart is worse than anywhere else in the country. We have seen people really struggling to keep up with the increased cost of rent.

A recent report by the Australian Institute of Health and Welfare showed that more than 40 per cent of Australians on low incomes who rent are now in rental stress. In other words, they are paying more than 30 per cent of their available income just to keep a roof over their heads. The shutting down of the National Rental Affordability Scheme without replacing it with something else is only going to make this situation worse. As I said earlier, in the next six years 37,000 families are going to see their rent go up as a result of the closure of this scheme. That means that, on average, about 160 families in every one of the 151 electorates represented in this place are going to see their rent go up massively over the course of the next few years.

We have an economy that is really struggling at the moment. The report that came from the IMF this week predicted that economic growth in the years ahead is going to be weaker in Australia than in countries like Greece. Bills are going up but wages aren't. Interest rates are at crisis levels. When we were going through the global financial crisis a decade ago interest rates were at three per cent. They are now less than one per cent. Consumer confidence is down, business confidence is down and housing construction—the building of homes—is down, yet the government keep telling us that nothing is wrong. They try to convince us and the Australian people that everything is hunky-dory. Well, it's not. There are a lot of people who are really struggling. The best evidence of that is the struggle that people have on a daily basis to pay their mortgage and to pay their rent—to get a roof over their heads.

According to the Reserve Bank, there are now more people in Australia who are struggling to pay their mortgage and more people in Australia who are in arrears on their mortgage repayments than at any time since the global financial crisis. That should tell you that there's something wrong. That should tell us that people really are struggling and that it's not just made up. People don't stop paying their mortgage unless they're in real strife.

As I said before, people are struggling to pay their rent as well. There are now more than a million people in Australia on low incomes who are in housing stress, who are paying more than 30 per cent of their income in rent. Homelessness—the sharpest, hardest edge of all of this—is also on the rise. According to the last census, there are more people who are homeless today in Australia—who are sleeping rough, couch surfing or sleeping on a train just to keep warm—than ever before in Australia.

I will give just one example of what that means. On the weekend, Foodbank, the organisation that helps to provide food to people in need across Australia, released its latest report, and it showed that, over the last 12 months, there has been a 22 per cent increase in the number of people seeking food relief from the charities that they provide to. That's massive—in the last 12 months there's been a 22 per cent increase in the number of people seeking food from Foodbank. You don't go to a local charity and ask for food unless you're hungry and you can't afford to get it yourself. That should tell us that there's a problem here.

I mentioned housing construction as well. That's a barometer of how strong the economy is, how the economy is going—and it's going backwards as well. Building approvals for the construction of residential housing are in freefall. They've gone down by almost 22 per cent in the last year. Construction job ads are down 35 per cent from their peak just over a year ago. We've already lost 50,000 jobs in construction in the last 12 months. The government talk a lot about jobs, and so they should; there is nothing more important in the work that we do here than keeping Australians safe and keeping Australians employed. There have been 50,000 people on the tools working in the construction industry who have lost their job over the course of the last 12 months—and, if you believe UBS, who have done analysis in this area, they predict that there could be another 100,000 Australians who work in the construction sector who are going to lose their job in the next 12 months.

That's on top of all of the issues that the minister across the table is very familiar with in terms of flammable cladding and shonky building inspectors. All of that is very bad, and the minister says that's a state issue. That's typical of this government that just wants to wipe its hands of any responsibility for anything. The bottom line is that you've got an economy that is weak, an economy that's struggling—and people expect us, when we come here, to do our job, to work hard for them and to make their lives easier, not to have ministers say, 'Well, technically, according to the law, that's not my responsibility.' That shows just how out of touch this minister and this government are.

Today, the Deputy Governor of the Reserve Bank made a speech in Sydney. He talked about exactly what I'm talking about here: about problems in the construction sector. He said that there's a 'sizeable downturn' underway in the construction sector and that it's a drag on the economy. He said that the Reserve Bank of Australia is expecting housing investment to drop by a 'further seven per cent' next year. So it's already dropping and already costing Australia jobs, and the Reserve Bank is expecting it to drop again by seven per cent next year. He said that the 'decline could even be larger' and that that had the potential to take at least one per cent off overall GDP growth.

When the Reserve Bank is cutting interest rates to crisis levels, when economic growth is predicted to be less than Greece, when we've already also lost 50,000 jobs in the construction sector and when the Deputy Governor of the Reserve Bank comes out today and says that it's expected to get even worse and that's going to hurt economic growth, that should be ringing alarm bells in this place. It should be ringing alarm bells for this government. Instead of saying, 'That's not our responsibility,' the government should be taking action here to make sure that we turn this around. But all we get from this government is this head-in-the-sand, 'not our responsibility' approach.

The result of that approach will be that more people will struggle to keep a roof over their head; more people will struggle to pay the mortgage; more people will struggle to pay the rent; and more jobs will be lost in the construction sector. It could be very different. The Australian people expect their government to be focused on these issues. They expect the Australian government to understand how important the housing sector is to keeping the Australian economy strong. They expect the Australian government to understand how important housing is to ordinary, everyday Australians who are struggling to pay the mortgage, struggling to pay the rent or struggling just to have a roof over their heads at all. And now we've got jobs being lost in their thousands in the construction sector as the economy gets weaker. It's time for the government to act. The Australian people deserve a government that's focused on this. They don't have one at the moment.

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