Kevin Rudd (Griffith, Australian Labor Party, Leader of the Opposition) Share this | Link to this | Hansard source

My question is to the Prime Minister. Is the Prime Minister aware of new data released by the Australian Prudential Regulation Authority which shows mortgage insurance claims by lenders whose customers have defaulted has surged by 329 per cent over the year to December 2006, the largest increase of any insurance class? Does the Prime Minister still maintain that Australian working families have never been better off?

John Howard (Bennelong, Liberal Party, Prime Minister) Share this | Link to this | Hansard source

I am aware of that data. I am also aware that—to use an expression I have heard often—when it comes to working families, a lot can be said about the conditions for working families in Australia at the present time. Let me preface these general remarks by acknowledging that not all Australian families enjoy the sorts of things that I am about to describe. I acknowledge that some Australian families are missing out and some Australian families are not realising as much as the great bulk of Australian families are.

The first thing I can say is that there are more Australian families working now than ever before. The Leader of the Opposition uses the expression ‘working families’ as a given. I remind the Leader of the Opposition that, when his party was last in office, it was not a given that families could get work. In fact, it was the norm for over a million Australians that they could not get work. I remind the Leader of the Opposition that unemployment in Australia—the greatest measure of the dividend of economic policy—is now at a 33-year low. I remind the Leader of the Opposition—and this affects working families all over Australia—that interest rates under this government for housing have averaged 7¼ per cent over the last 11½ years, compared to 12¾ per cent under the previous government, a clear difference of five percentage points. On an average mortgage of $235,000, a homeowner would have paid, on average, $1,416 a month in mortgage payments under the current government, compared to $2,497 a month if the average interest rate under the Labor Party still applied.

I remind the Leader of the Opposition that real wages of Australian workers have increased by 20.8 per cent over the last 11½ years, compared to a fall of 1.8 per cent under the former government. I remind the Leader of the Opposition that only the top 40 per cent of Australian households pay net income tax and that research by the OECD shows Australia has one of the fairest and most redistributive tax and income support systems in the OECD.

On the issue of housing affordability, which is clearly the basis of the question asked by the Leader of the Opposition, I draw his attention to the report released yesterday by the Urban Development Institute of Australia, which identified 16 factors contributing to declining housing affordability, three of which it examined in detail: supply issues, approval delays, and costs and charges. The report had this to say:

It is acknowledged that the vast majority of steps that need to be taken (and in some jurisdictions are being taken) are at local government and state government level.

The report’s assessment of housing affordability in Sydney demonstrates the damaging effects of state government policies on homeownership. On land supply, the report had this to say:

In the mid 1990s the New South Wales Government adopted a largely ideologically driven and widely contentious policy experiment with urban consolidation.

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The policy has had an unprecedented impact.

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The lack of housing supply has led to dramatic price escalation in Sydney and New South Wales. ... house building costs have remained remarkably consistent over the 30 year period whereas land has increased markedly so that it now represents almost 80 per cent of the cost of buying a house and land package.

I would say to the Leader of the Opposition: the impact of all of these things on working families in Australia is significant. Working families in this country have been uppermost in our mind over the last 11½ years, and that is why we have pursued policies during that period of time demonstrably to their benefit and for their support.