Bill Shorten (Maribyrnong, Australian Labor Party, Leader of the Opposition) Share this | Link to this | Hansard source

My question is to the Prime Minister. The Productivity Commission has found that the government's intervention in the housing sector, through APRA, has, led to 'a windfall gain' for the banking sector. Up to half of this gain is in effect being paid for by taxpayers, as interest on investment loans is tax deductible. The commission estimates the cost borne by taxpayers as a result was up to $500 million a year. Does the Prime Minister agree or disagree?

Scott Morrison (Cook, Liberal Party, Treasurer) Share this | Link to this | Hansard source

I don't agree. No, I don't agree. I'd be very happy for the shadow Treasurer, given he is so interested in Treasury briefings, to have a briefing on this from Treasury, if you'd like. I can make my own assessment of these things, as I do. And it is for this simple reason: the Productivity Commission's report does not provide a costing on this at all, as the shadow Treasurer and the Leader of the Opposition should know. The Productivity Commission's report does not take into account the fact that price growth in housing, say, in Sydney, has fallen from 17 per cent to one per cent, and as a result those interest-only loans under a higher price growth environment means they would have borrowed a lot more. They don't take into account the substitution effects. They don't take into account the behavioural effects.

If what they are saying is true, then every time the Reserve Bank decides either to lift or to lower cash rates, that is somehow a cost to the taxpayer, either up or down. If the government had not taken the action through the regulator to ensure that we dealt with the heated investor activity, particularly in the Sydney and Melbourne markets, in the way that we did and that is being opposed by the opposition, the Reserve Bank would have had greater pressure on it to lift the cash rate. So the Labor Party is saying, 'No, what you should have done is you should have allowed the pressure to fall on the Reserve Bank to deal with problems in the Sydney and Melbourne housing markets by putting up the cash rate on the entire economy.'

The shadow Treasurer is economically illiterate. He has no understanding of the operations of property markets or any other markets. He may once have believed these things. He may once have understood them, but the economic re-education program that he has been put through by the Leader of the Opposition means he has abandoned all of these things. But it's going to catch up with them, because when you go around telling your audience what they want to hear in too many places it ends up catching up with you. We're going to see that in the Batman by-election.

I look forward to the Leader of the Opposition attending the border protection debates down there in Batman. I look forward to him thumping the table and telling them how tough he is on the borders, down there in—

Bill Shorten (Maribyrnong, Australian Labor Party, Leader of the Opposition) Share this | Link to this | Hansard source

Mr Speaker—

Tony Smith (Speaker) Share this | Link to this | Hansard source

The Leader of the Opposition will resume his seat. The Treasurer has strayed off the topic of the question.

Scott Morrison (Cook, Liberal Party, Treasurer) Share this | Link to this | Hansard source

I confess I did, Mr Speaker. But the Leader of the Opposition—

Tony Smith (Speaker) Share this | Link to this | Hansard source

Yes, rather dramatically—

Scott Morrison (Cook, Liberal Party, Treasurer) Share this | Link to this | Hansard source

has strayed off the topic of the economy for his entire time in the job. (Time expired)